<PAGE>
As filed with the Securities and Exchange Commission on January 27, 1999
Subject to Amendment
Registration Nos. 333-
333-
333-
333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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Duke Capital Delaware 56-0282142
Corporation Delaware 51-0379864
Duke Capital Delaware 62-6349496
Financing Trust III Delaware 62-6349495
Duke Capital
Financing Trust IV
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer
Identification
Duke Capital Nos.)
Financing Trust V
(Exact name of each
registrant as
specified in its
charter)
422 South Church Street
Charlotte, North Carolina 28202
704-594-6200
(Address, including zip code, and telephone number,including area code, of
each registrant's principal executive offices)
--------------
RICHARD J. OSBORNE JOHN SPUCHES
Vice President and Chief Dewey Ballantine
Financial Officer LLP
422 South Church Street 1301 Avenue of the
Charlotte, North Carolina 28202 Americas
Telephone No. 704-382-5159 New York, New York
10019
Telephone No. 212-
259-7700
(Names, addresses, including zip codes, and telephone numbers, including area
codes, of agents for service of each registrant)
--------------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this registration statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_] __________
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]__________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
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CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
Proposed Maximum
Amount Offering Price Proposed Maximum
Title of Each Class of to be Per Aggregate Offering Amount of
Securities to be Registered Registered(1) Unit(1)(2)(3) Price(1)(2)(3) Registration Fee(1)
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<S> <C> <C> <C> <C>
Duke Capital Financing Trust III
Trust Preferred Securities..........
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Duke Capital Financing Trust IV Trust
Preferred Securities................
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Duke Capital Financing Trust V Trust
Preferred Securities................
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Duke Capital Corporation Senior
Notes...............................
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Duke Capital Corporation Junior
Subordinated Notes .................
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Duke Capital Corporation Guarantees
with respect to Trust Preferred
Securities of Duke Capital Financing
Trust III,
Duke Capital Financing Trust IV and
Duke Capital Financing Trust
V(4)(5).............................
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Total................................ $1,000,000,000 100% $1,000,000,000 $278,000
</TABLE>
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(1) There are being registered hereunder such presently indeterminate number
of Trust Preferred Securities of Duke Capital Financing Trust III, Duke
Capital Financing Trust IV and Duke Capital Financing Trust V and such
presently indeterminate principal amount of Senior Notes and Junior
Subordinated Notes of Duke Capital Corporation with an aggregate initial
offering price not to exceed $1,000,000,000. Junior Subordinated Notes
also may be issued to Duke Capital Financing Trust III, Duke Capital
Financing Trust IV or Duke Capital Financing Trust V and later distributed
upon dissolution and distribution of the assets thereof, which would
include such Junior Subordinated Notes for which no separate consideration
will be received. Pursuant to Rule 457(o) under the Securities Act of
1933, which permits the registration fee to be calculated on the basis of
the maximum offering price of all the securities listed, the table does
not specify by each class information as to the amount to be registered,
proposed maximum offering price per unit or proposed maximum aggregate
offering price.
(2) Estimated solely for the purpose of determining the registration fee.
(3) Exclusive of accrued interest and distributions, if any.
(4) No separate consideration will be received for the Duke Capital
Corporation Guarantees. Pursuant to Rule 457(n) under the Securities Act
of 1933, no separate fee is payable in respect of the Duke Capital
Corporation Guarantees.
(5) Includes the obligations of Duke Capital Corporation under the respective
Trust Agreements, the Subordinated Indenture, the related series of Junior
Subordinated Notes, the respective Guarantees and the respective
Agreements as to Expenses and Liabilities, which include the Corporation's
covenant to pay any indebtedness, expenses or liabilities of the Trusts
(other than obligations pursuant to the terms of the Trust Preferred
Securities or other similar interests), all as described in this
registration statement.
--------------
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 the registration statement
shall become effective on such date as the Securities and Exchange Commission,
acting pursuant to said Section 8(a), may determine.
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<PAGE>
EXPLANATORY NOTE
This Registration Statement includes a prospectus and two forms of prospectus
supplement. The first is a form of prospectus supplement that may be used in
connection with issuances from time to time of Trust Preferred Securities. The
second is a form of prospectus supplement that may be used in connection with
issuances from time to time of Senior Notes.
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY +
+NOT SELL THE PREFERRED SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH +
+THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT +
+AN OFFER TO SELL THE PREFERRED SECURITIES AND IT IS NOT SOLICITING AN OFFER +
+TO BUY THE PREFERRED SECURITIES IN ANY STATE WHERE THE OFFER OR SALE OF THE +
+PREFERRED SECURITIES IS NOT PERMITTED. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED , 1999)
SUBJECT TO COMPLETION DATED , 1999
[ ] PREFERRED SECURITIES
DUKE CAPITAL FINANCING TRUST [ ]
% CUMULATIVE TRUST PREFERRED SECURITIES
(LIQUIDATION AMOUNT $ PER PREFERRED SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY
DUKE CAPITAL CORPORATION
A SUBSIDIARY OF DUKE ENERGY CORPORATION
----------
This is an offering of % Cumulative Trust Preferred Securities ("Preferred
Securities") of Duke Capital Financing Trust [ ], a Delaware statutory business
trust. The Trust will use the proceeds from the sale of the Preferred
Securities to purchase $ aggregate principal amount of Series Junior
Subordinated Notes from Duke Capital Corporation. The Series Junior
Subordinated Notes are unsecured subordinated obligations of the Corporation
and have payment terms similar to those of the Preferred Securities. The Trust
will rely on the payments it receives on the Series Junior Subordinated Notes
to fund all payments on the Preferred Securities. The Corporation will
guarantee payments on the Preferred Securities as described herein.
The Preferred Securities will pay cumulative cash distributions at the annual
rate of % of the liquidation amount ($ per Preferred Security) payable
quarterly on March 31, June 30, September 30 and December 31 of each year,
beginning on , . However, at any time and as often as it wishes, the
Corporation may begin an Extension Period, during which distributions will be
deferred for up to 20 consecutive quarters, but not beyond the maturity date of
the Preferred Securities. During an Extension Period, deferred distributions on
the Preferred Securities will accumulate additional distributions at an annual
rate of % (to the extent permitted by applicable law).
When the Series Junior Subordinated Notes mature or when the Corporation
redeems or repays any Series Junior Subordinated Notes, the Trust will redeem
a related amount of Preferred Securities. The stated maturity of the Series
Junior Subordinated Notes is , . The Corporation may redeem the Series
Junior Subordinated Notes (1) at any time on or after , , in whole
or in part, or (2) at any time within 90 days after the occurrence of certain
tax or regulatory developments, in whole but not in part. The redemption price
of the Preferred Securities will equal the Liquidation Amount plus any
accumulated and unpaid distributions. The Corporation may cause the Trust to
distribute to the holders of Preferred Securities an equivalent amount of
Series Junior Subordinated Notes at any time in exchange for the Preferred
Securities.
SEE "RISK FACTORS" BEGINNING ON PAGE S-8 TO READ ABOUT CERTAIN FACTORS YOU
SHOULD CONSIDER BEFORE PURCHASING THE PREFERRED SECURITIES.
We intend to list the Preferred Securities on the New York Stock Exchange
under the symbol " ." We expect trading in the Preferred Securities on the
New York Stock Exchange to begin within 30 days after the original issue date.
----------
<TABLE>
<CAPTION>
PER PREFERRED SECURITY TOTAL
---------------------- -----
<S> <C> <C>
Initial Public Offering Price......................
Underwriting Discounts and Commissions............. (1) (1)
Proceeds, before expenses, to the Trust............
</TABLE>
- -----
(1) Underwriting commissions of $ per Preferred Security (or $ in
the aggregate) will be paid by the Corporation.
----------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The underwriters are severally underwriting the Preferred Securities. The
underwriters expect to deliver the Preferred Securities in book-entry only form
through the facilities of The Depository Trust Company against payment in New
York, New York on , .
----------
[NAMES OF UNDERWRITERS]
----------
Prospectus Supplement dated , .
<PAGE>
You should rely only on the information contained or incorporated by
reference in this Prospectus Supplement and the accompanying Prospectus. We
have not, and the Underwriters have not, authorized any other person to provide
you with different information. If anyone provides you with different or
inconsistent information, you should not rely on it. We are not, and the
Underwriters are not, making an offer to sell these securities in any
jurisdiction where the offer or sale is not permitted. You should assume that
the information appearing in this Prospectus Supplement and the accompanying
Prospectus is accurate as of the date on the front of the documents only. Our
business, financial condition, results of operations and prospects may have
changed since that date.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
Prospectus Supplement ----
<S> <C>
Forward-Looking Statements ............................................... S-3
Summary of Offering....................................................... S-4
Risk Factors.............................................................. S-8
Recent Developments....................................................... S-11
Duke Capital Financing Trust [ ]......................................... S-12
Description of the Preferred Securities................................... S-13
Description of the Series Junior Subordinated Notes..................... S-27
Relationship Among the Preferred Securities, the Series Junior
Subordinated Notes and the Guarantee..................................... S-31
Material Federal Income Tax Considerations................................ S-33
Underwriting.............................................................. S-36
Validity of the Securities................................................ S-37
Prospectus
Where to Find More Information............................................ 2
Duke Capital Corporation.................................................. 4
The Trusts................................................................ 9
Use of Proceeds........................................................... 10
Description of the Senior Notes........................................... 11
Description of the Junior Subordinated Notes.............................. 23
Description of the Preferred Securities................................... 33
Description of the Guarantees............................................. 34
Accounting Treatment...................................................... 37
Plan of Distribution...................................................... 37
Validity of the Securities................................................ 38
Experts................................................................... 38
</TABLE>
S-2
<PAGE>
FORWARD-LOOKING STATEMENTS
This Prospectus Supplement and the accompanying Prospectus include forward-
looking statements within the meaning of Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934. We caution
investors and prospective investors that there are a number of forward-looking
statements contained or incorporated by reference in this Prospectus Supplement
and the accompanying Prospectus. These forward-looking statements may include
statements about the expected revenues, earnings, capital expenditures,
resolution and impact of litigation, competitive performance, or other
prospects for the business of Duke Capital Corporation (the "Corporation") and
its subsidiaries or their affiliated companies, and include any and all
assumptions that underlie the forward-looking statements and other statements
that are other than statements of historical fact. Actual outcomes and results
are likely to differ, and may differ materially, from those projected. Factors
that could cause forward-looking statements to be inaccurate include, but are
not limited to:
. state and federal legislative and regulatory initiatives
that affect cost and investment recovery, have an impact
on rate structures, and affect the speed and degree to
which competition enters the electric and natural gas
industries;
. industrial, commercial and residential growth in the
service territories of the Corporation and its
subsidiaries;
. the weather and other natural phenomena;
. the timing and extent of changes in commodity prices and
interest rates;
. changes in environmental and other laws and regulations
to which the Corporation and its subsidiaries are
subject or other external factors over which the
Corporation has no control;
. the results of financing efforts;
. growth in opportunities for the Corporation's
subsidiaries;
. achievement of Year 2000 readiness; and
. the effect of the Corporation's accounting policies.
In light of these risks, uncertainties and assumptions, the forward-looking
events discussed in this Prospectus Supplement and the accompanying Prospectus
might not occur. We undertake no obligation to publicly update or revise any
forward-looking statements or this discussion of some of the factors that could
cause actual results to differ, whether as a result of new information, future
events or otherwise.
S-3
<PAGE>
SUMMARY OF OFFERING
This summary highlights information appearing elsewhere in this Prospectus
Supplement and in the accompanying Prospectus. This summary is not complete and
does not contain all the information you should consider before investing in
the Preferred Securities. You should pay special attention to the Risk Factors
section of this Prospectus Supplement to determine whether an investment in the
Preferred Securities is appropriate for you.
The Corporation............. Duke Capital Corporation, a wholly owned
subsidiary of Duke Energy Corporation, serves as
the parent company to a number of affiliates of
Duke Energy Corporation. Those affiliates are
primarily engaged in the interstate
transportation and storage of natural gas, in
the gathering, processing, marketing and
intrastate transportation and storage of natural
gas, natural gas liquids and crude oil, in
natural gas and electric power marketing, in the
acquisition, development and operation of
independent power production facilities, in risk
management services and in engineering
consulting, construction and other related
energy services. The principal executive offices
of the Corporation are located at 422 South
Church Street, Charlotte, NC 28202 (telephone
(704) 594-6200).
The Trust................... Duke Capital Financing Trust [ ] is a statutory
business trust created solely for the purpose of
issuing Preferred Securities to the public and
Common Securities to the Corporation and
investing the proceeds in an equivalent amount
of the Corporation's Series Junior
Subordinated Notes due , (the
"Series Junior Subordinated Notes").
Preferred Securities % Cumulative Trust Preferred Securities (the
Offered..................... "Preferred Securities").
Distributions............... Holders of the Preferred Securities are entitled
to receive cumulative cash distributions at the
annual rate of % of the liquidation amount of
$ per Preferred Security accruing from the
original issue date and payable, unless
deferred, quarterly on March 31, June 30,
September 30 and December 31 of each year (each,
a "Distribution Date"), commencing on , .
S-4
<PAGE>
Record Dates................ The record date for each Distribution Date will
be the close of business on the 15th calendar
day prior to such Distribution Date.
Junior Subordinated Notes... The Trust will use the proceeds from the sale of
the Preferred Securities to purchase from the
Corporation $ aggregate principal amount of
Series Junior Subordinated Notes due . The
Series Junior Subordinated Notes are unsecured
subordinated obligations of the Corporation.
Subject to any deferral, distributions are
payable on the Preferred Securities and the
Distributions Dates for the Preferred Securities
will correspond to the interest rate and
interest payment dates on the Series Junior
Subordinated Notes. If the Corporation does not
pay principal or interest on the Series Junior
Subordinated Notes, no amounts will be paid on
the Preferred Securities. See "Description of
the Preferred Securities" in this Prospectus
Supplement.
Deferral of Distributions... The Corporation has the right to defer payments
of interest on the Series Junior Subordinated
Notes by extending the interest payment period
on the Series Junior Subordinated Notes, at
any time and as often as it wishes, for up to 20
consecutive quarters (each, an "Extension
Period"), but not beyond the maturity date of
the Series Junior Subordinated Notes.
If interest payments on the Series Junior
Subordinated Notes are deferred, distributions
on the Preferred Securities will also be
deferred. During an Extension Period, holders of
Preferred Securities (or the Series Junior
Subordinated Notes) will recognize interest
income for federal income tax purposes in
advance of the receipt of the cash payments of
such deferred distributions (or interest) even
if the holder is a cash basis taxpayer. See
"Description of the Series Junior Subordinated
Notes--Option to Extend Interest Payment Period"
and "Material Federal Income Tax
Considerations--Original Issue Discount."
Deferred interest will bear interest at an
annual rate of %, compounded quarterly, to the
date of payment to the extent permitted by
applicable law.
If interest payments on the Series Junior
Subordinated Notes are deferred, the Corporation
will not, with certain exceptions, be permitted
during an Extension Period (1) to pay dividends
on, or redeem or otherwise purchase, any of its
capital stock or (2) to pay principal or
interest on, or
S-5
<PAGE>
redeem or otherwise purchase, any debt
securities ranking equal in priority with or
subordinate to the Series Junior Subordinated
Notes.
Redemption.................. The Trust will redeem the Preferred Securities
when the Corporation repays the Series Junior
Subordinated Notes at maturity or upon their
earlier redemption. The Corporation may at its
option redeem the Series Junior Subordinated
Notes, in whole or in part, from time to time on
or after , . The Corporation may also
redeem the Series Junior Subordinated Notes at
any time, in whole, within 90 days following the
occurrence of a Special Event (see below).
Redemption Price............ If the Preferred Securities are redeemed, each
holder of a Preferred Security will be entitled
to receive a liquidation amount of $ plus
accrued and unpaid distributions to the date of
payment.
Special Event............... A "Special Event" means a Tax Event or an
Investment Company Act Event. A "Tax Event"
means that because of changes in certain tax
laws or regulations or in how they are
interpreted or applied, there is more than an
insubstantial risk that (a) the Trust would be
subject to United States federal income tax with
respect to income accrued or received on the
Series Junior Subordinated Notes, (b) interest
payable on the Series Junior Subordinated
Notes would not be deductible by the Corporation
for United States federal income tax purposes or
(c) the Trust would be subject to more than a de
minimis amount of other taxes, duties or other
governmental charges. An "Investment Company Act
Event" means that because of changes in certain
laws or regulations or in how they are
interpreted or applied, there is more than an
insubstantial risk that the Trust is or will be
considered an "investment company" under the
Investment Company Act of 1940. See "Risk
Factors--Special Event Redemption; Distribution
of Series Junior Subordinated Notes upon
Termination of Trust."
Termination of Trust........ The Corporation will have the right to terminate
the Trust at any time and cause the Property
Trustee to distribute Series Junior
Subordinated Notes to the holders of the
Preferred Securities in exchange for those
securities. This right is optional and wholly
within the discretion of the Corporation.
S-6
<PAGE>
See "Description of the Preferred Securities--
Liquidation Distribution upon Dissolution" and "
--Distribution of Series Junior Subordinated
Notes upon Termination of Trust."
Ranking of Series
Junior Subordinated Notes... The Series Junior Subordinated Notes will be
subordinate and junior in right of payment to
all indebtedness for borrowed money and other
obligations of the Corporation included in the
definition of Senior Indebtedness.
Guarantee................... The Corporation will guarantee the payment of
distributions and other payments by the Trust on
the Preferred Securities, but only to the extent
the Trust has funds legally and immediately
available to make such distributions (the
"Guarantee").
Ranking of Guarantee........ The Corporation's obligations under the Guarantee
will be subordinate and junior in right of
payment to all other liabilities of the
Corporation (other than similar guarantees) and
will rank equal in priority with the most senior
preferred stock that may be issued by the
Corporation and with such similar guarantees.
Book-Entry Only Issuances... The Preferred Securities will be represented by a
global certificate or certificates that will be
deposited with and registered in the name of The
Depository Trust Company, New York, New York
("DTC") or its nominee. This means that
investors will not receive certificates for
their Preferred Securities.
Listing..................... The Trust has applied to list the Preferred
Securities on the New York Stock Exchange.
The Trustees................ The Chase Manhattan Bank will act as Property
Trustee of the Trust. Two officers of the
Corporation also will act as the Administrative
Trustees of the Trust. Chase Manhattan Bank
Delaware will be the Delaware Trustee of the
Trust. The Chase Manhattan Bank will act as the
Subordinated Indenture Trustee (the trustee
under the Subordinated Note Indenture under
which the Series Junior Subordinated Notes
will be issued) and will act as the Guarantee
Trustee (the trustee under the Guarantee). The
Property Trustee, Delaware Trustee and
Administrative Trustees are sometimes
collectively referred to in this Prospectus
Supplement as the Securities Trustees.
S-7
<PAGE>
RISK FACTORS
An investment in the Preferred Securities involves a number of risks, some of
which relate to the nature of the Preferred Securities and others of which
relate to the Corporation. You should carefully read and consider the following
risk factors and the other information contained in this Prospectus Supplement
and the accompanying Prospectus, before buying any Preferred Securities.
Ranking of the Series Junior Subordinated Notes
The obligations of the Corporation under the Series Junior Subordinated
Notes are subordinate and junior in right of payment to all present and future
Senior Indebtedness of the Corporation. As of , , Senior Indebtedness of
the Corporation totaled approximately $ .
The terms in the Preferred Securities, the Series Junior Subordinated Notes
and the Guarantee do not limit the Corporation's ability to incur additional
indebtedness, including Senior Indebtedness. See "Description of the
Guarantees" and "Description of the Junior Subordinated Notes--Subordination"
in the accompanying Prospectus.
The Corporation conducts its business through subsidiaries. Accordingly, the
ability of the Corporation to meet its obligations under the Series Junior
Subordinated Notes will depend on the earnings and cash flows of its
subsidiaries and their ability to pay dividends or to advance or repay funds to
the Corporation. In addition, the rights of the Corporation and its creditors
to participate in the assets of any subsidiary upon the subsidiary's
liquidation or recapitalization will be subject to the prior claims of the
subsidiary's creditors.
Ranking of the Guarantee
The Corporation's obligations under the Guarantee will rank:
. subordinate and junior in right of payment to all other liabilities of
the Corporation (other than similar guarantees);
. equal in priority with the most senior preferred stock that may be
issued by the Corporation and with such similar guarantees; and
. senior to the Corporation's common stock.
Payments on the Preferred Securities Dependent upon Payments on the Series
Junior Subordinated Notes; Rights under the Guarantee
Payments made on the Series Junior Subordinated Notes will be the only
source of funds for payments on the Preferred Securities. If the Corporation
defaults in its payment obligations on the Series Junior Subordinated Notes,
the Trust will lack available funds for distributions or other payments on the
Preferred Securities. In such event holders of the Preferred Securities will
not be able to rely upon the Guarantee for such distributions or other
payments.
Option to Extend Interest Payment Period
The Corporation has the right under the Subordinated Note Indenture, at any
time, and from time to time, to defer payments of interest on the Series
Junior Subordinated Notes for a period of
S-8
<PAGE>
up to 20 consecutive quarters (each, an "Extension Period"), but not beyond the
maturity date of the Series Junior Subordinated Notes.
Deferred installments of interest on the Series Junior Subordinated Notes
will bear interest at an annual rate of %, compounded quarterly, to the date
of payment to the extent permitted by law. The payment of such deferred
interest, together with any interest thereon, will be passed through to the
holders of the Preferred Securities.
The only restrictions on the Corporation's ability to defer payments of
interest are that during any Extension Period the Corporation may not, with
certain exceptions:
. pay dividends on, or redeem or otherwise purchase, any of its capital
stock; or
. pay principal or interest on, or redeem or otherwise purchase, any debt
securities ranking equal in priority with or subordinate to the Series
Junior Subordinated Notes.
See "Description of the Preferred Securities--Distributions" and "Description
of the Series Junior Subordinated Notes--Option to Extend Interest Payment
Period" and "--Certain Covenants."
If the Corporation defers payments of interest, each holder of Preferred
Securities (or Series Junior Subordinated Notes) will recognize interest
income for federal income tax purposes in advance of the receipt of cash
payment of such deferred distributions (or interest) even if the holder is a
cash basis taxpayer and will not receive cash related to such income if such
holders dispose of their Preferred Securities (or Series Junior Subordinated
Notes) prior to the record date for the date on which payments of such amounts
are made. See "Material Federal Income Tax Considerations--Original Issue
Discount" and "--Sale of Preferred Securities."
Investors should consult their own tax advisors with respect to the tax
consequences of an investment in the Preferred Securities.
Special Event Redemption; Distribution of Series Junior Subordinated Notes
upon Termination of Trust
The Corporation will have the option, within 90 days following the occurrence
of a Special Event, to redeem the Series Junior Subordinated Notes in whole,
with the result that the Preferred Securities will be redeemed.
The Corporation will also have the right at any time to terminate the Trust
and cause the Series Junior Subordinated Notes to be distributed to the
holders of the Preferred Securities in liquidation of the Trust. See
"Description of the Preferred Securities--Special Event Redemption or
Distribution" and "--Distribution of Series Junior Subordinated Notes upon
Termination of Trust."
There can be no assurance as to the market price for the Series Junior
Subordinated Notes that may be distributed in exchange for Preferred Securities
if a termination or liquidation of the Trust occurs. Accordingly, the Series
Junior Subordinated Notes that the investor may receive on termination and
liquidation of the Trust may trade at a discount to the price that the investor
paid to purchase the Preferred Securities offered hereby. See "Description of
the Preferred Securities--Distribution of Series Junior Subordinated Notes
upon Termination of Trust."
S-9
<PAGE>
Limited Voting Rights
Holders of Preferred Securities will have limited voting rights. In general,
holders of Preferred Securities will not be entitled to vote to appoint, remove
or replace any of the Securities Trustees, which voting rights are generally
vested in the Corporation as the holder of the Common Securities. If an Event
of Default under the Subordinated Note Indenture with respect to the Series
Junior Subordinated Notes occurs and is continuing, however, the holders of the
Preferred Securities will have the right to appoint a substitute Property
Trustee or Delaware Trustee. See "Description of the Preferred Securities--
Voting Rights" and "--Events of Default" in this Prospectus Supplement and
"Description of the Junior Subordinated Notes--Events of Default" in the
accompanying Prospectus.
Trading Characteristics of Preferred Securities
The Preferred Securities are expected to be listed on the New York Stock
Exchange, subject to official notice of issuance. The Preferred Securities are
expected to trade at a price that takes into account the value, if any, of
accrued but unpaid distributions; thus, purchasers will not pay and sellers
will not receive accrued and unpaid interest with respect to the Preferred
Securities that is not included in the trading price of the Preferred
Securities. If a Preferred Security is disposed of prior to the occurrence of
an Extension Period, any portion of the amount received that is attributable to
accrued interest will be treated as interest income to a U.S. holder for tax
purposes and will not be treated as part of the amount realized for purposes of
determining gain or loss on the disposition of the Preferred Security. If an
Extension Period occurs, interest on the Series Junior Subordinated Notes
will be included in the gross income of U.S. holders of Preferred Securities as
it accrues rather than when it is paid. If an Extension Period occurs, a holder
who disposes of his Preferred Securities between record dates for payments of
distributions would be required to include accrued but unpaid interest on the
Series Junior Subordinated Notes through the date of disposition in income as
original issue discount, and to add such amount to his adjusted tax basis in
his pro rata share of the related Series Junior Subordinated Notes deemed
disposed of. To the extent the selling price is less than the holder's adjusted
tax basis, a holder generally 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. See "Material Federal Income Tax
Considerations--Original Issue Discount" and "--Sale of Preferred Securities."
There has been no public market for the Preferred Securities prior to this
offering, and there can be no assurance that an active public market for the
Preferred Securities will develop. If an active trading market for the
Preferred Securities does develop, there can be no assurance that it will be
sustained after this offering. See "Plan of Distribution" in the accompanying
Prospectus.
Investment in Trust Involves Risks Parallel to Those of Investment in
Corporation
As with an investment in the Corporation, an investment in the Trust involves
risks associated with operating conditions, competitive factors, economic
conditions, industry conditions and equity market conditions.
Consequences of Highly Leveraged Transaction
The Subordinated Note Indenture does not contain provisions that afford
holders of the Series Junior Subordinated Notes protection in the event of a
highly leveraged transaction involving the Corporation.
S-10
<PAGE>
RECENT DEVELOPMENTS
Recent Income Statement Data
The following table presents unaudited income statement data for the year
ended December 31, 1998, which data should be read in conjunction with the
consolidated financial statements, the notes thereto and the other information
contained or incorporated by reference in this Prospectus Supplement and the
accompanying Prospectus.
<TABLE>
<CAPTION>
(Dollars
in
Thousands)
-----------
<S> <C>
Operating Revenues........................................... $13,059,000
Operating Expenses........................................... 12,023,000
Operating Income............................................ 1,036,000
Other Income, Net............................................ 101,000
Earnings Before Interest and Taxes........................... 1,137,000
Interest Expense............................................. 237,000
Income Before Extraordinary Loss............................. 519,000
Net Income................................................... 511,000
</TABLE>
S-11
<PAGE>
DUKE CAPITAL FINANCING TRUST [ ]
The Trust is a statutory business trust created under Delaware law pursuant
to the filing of a certificate of trust with the Delaware Secretary of State on
, 1998. The Trust's business is defined in a trust agreement, executed by
the Corporation, as depositor, and the Delaware Trustee. That trust agreement
will be amended and restated in its entirety on the date of original issuance
of the Preferred Securities in substantially the form filed as an exhibit to
the Registration Statement of which this Prospectus Supplement and the
accompanying Prospectus form a part (the "Trust Agreement"). The Trust
Agreement will be qualified as an indenture under the Trust Indenture Act of
1939.
The Trust exists for the exclusive purposes of issuing and selling the
Preferred Securities and the Common Securities (collectively, the "Trust
Securities") representing undivided beneficial interests in the assets of the
Trust, investing the gross proceeds of the Trust Securities in the Series
Junior Subordinated Notes, and engaging in only those other activities as are
necessary, appropriate, convenient or incidental to those purposes. The Trust
has a term of approximately years from its creation, but may terminate
earlier as provided in the Trust Agreement.
Upon the issuance of the Preferred Securities, the purchasers of the
Preferred Securities will own all the Preferred Securities, which will have an
aggregate liquidation amount equal to approximately 97% of the total capital of
the Trust. The Corporation will acquire all the Common Securities, which will
have an aggregate liquidation amount equal to approximately 3% of the total
capital of the Trust. The Common Securities will rank equal in priority with,
and payments will be made on the Common Securities pro rata with, the Preferred
Securities, except that upon the occurrence and continuance of an Event of
Default under the Subordinated Note Indenture with respect to the Series
Junior Subordinated Notes, the rights of the holders of Common Securities to
payments in respect of distributions and payments upon liquidation, redemption
and otherwise will be subordinated to the rights of the holders of the
Preferred Securities.
The Securities Trustees will conduct the Trust's business and affairs. The
Securities Trustees will be appointed by the Corporation as the holder of the
Common Securities. Two officers of the Corporation initially will serve as
Administrative Trustees. The Chase Manhattan Bank will serve as Property
Trustee and will hold legal title to the Series Junior Subordinated Notes on
behalf of the Trust and the holders of the Trust Securities. Chase Manhattan
Bank Delaware will serve as Delaware Trustee. In certain circumstances, the
holders of a majority in liquidation amount of the Preferred Securities will be
entitled to appoint a substitute Property Trustee or Delaware Trustee. See
"Description of the Preferred Securities--Events of Default."
The Property Trustee will hold legal title to the Series Junior
Subordinated Notes for the benefit of the Trust and the holders of the Trust
Securities and will have the power, with certain exceptions, to exercise all
rights, powers and privileges under the Subordinated Note Indenture as the
holder of the Series Junior Subordinated Notes. To the extent payments in
respect of the Series Junior Subordinated Notes are made to the Property
Trustee, the Property Trustee will make payments of distributions and payments
on liquidation, redemption and otherwise to the holders of the Trust
Securities. The Corporation, as the holder of all the Common Securities, will
have the right to appoint, remove or replace any of the Securities Trustees,
subject to the right of the holders of a majority in
S-12
<PAGE>
liquidation amount of the Preferred Securities to appoint a substitute Property
Trustee or Delaware Trustee under certain circumstances. See "Description of
the Preferred Securities--Events of Default."
The Series Junior Subordinated Notes will constitute substantially all of
the assets of the Trust. Other assets that may constitute "Trust Property" (as
that term is defined in the Trust Agreement) include any cash on deposit in, or
owing to, the payment account as established under the Trust Agreement, as well
as any other property or assets held by the Property Trustee pursuant to the
Trust Agreement. In addition, the Trust may, from time to time, receive cash
from the Corporation pursuant to the Agreement as to Expenses and Liabilities
between the Corporation and the Trust.
The rights of the holders of the Preferred Securities, including economic
rights, rights to information and voting rights, are as set forth in the Trust
Agreement, the Delaware Business Trust Act and the Trust Indenture Act of 1939.
See "Description of the Preferred Securities."
The Trust's office address in the State of Delaware is c/o Chase Manhattan
Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801. The principal
place of business of the Trust will be c/o Duke Capital Corporation, 422 South
Church Street, Charlotte, North Carolina 28202 (telephone (704) 594-6200).
DESCRIPTION OF THE PREFERRED SECURITIES
The Trust will issue the Preferred Securities pursuant to the terms of the
Trust Agreement. The Trust Agreement will be qualified as an indenture under
the Trust Indenture Act of 1939. The Property Trustee will act as the indenture
trustee with respect to the Trust Agreement, as well as the Guarantee, for
purposes of compliance with the provisions of such Act. The terms of the
Preferred Securities will include those stated in the Trust Agreement and in
the Delaware Business Trust Act, and those made part of the Trust Agreement by
the Trust Indenture Act of 1939.
The following summary of the principal terms and provisions of the Preferred
Securities does not purport to be complete and is subject to, and qualified in
its entirety by reference to, the Trust Agreement, the form of which is filed
as an exhibit to the Registration Statement of which this Prospectus Supplement
and the accompanying Prospectus are a part, as well as the Trust Indenture Act
of 1939.
General
The Trust Agreement authorizes the Administrative Trustees to issue the
Preferred Securities and the Common Securities on behalf of the Trust. The
Preferred Securities represent preferred undivided beneficial interests in the
assets of the Trust. The Common Securities represent common undivided
beneficial interests in the assets of the Trust. The Trust Agreement does not
permit the Trust to issue any securities other than the Preferred Securities
and the Common Securities or to incur any indebtedness for borrowed money.
Pursuant to the Trust Agreement, the Property Trustee will own and hold the
Series Junior Subordinated Notes for the benefit of the Trust and the holders
of the Trust Securities.
The Corporation will own all the Common Securities. The Common Securities
will rank equal in priority with the Preferred Securities, and payments will be
made on the Common Securities on a
S-13
<PAGE>
pro rata basis with the Preferred Securities, except that the rights of the
holders of the Common Securities to receive payment of periodic distributions
and payments upon liquidation, redemption and otherwise will be subordinated to
the rights of the holders of the Preferred Securities upon the occurrence of an
Event of Default under the Subordinated Note Indenture with respect to the
Series Junior Subordinated Notes.
The Corporation has guaranteed on a subordinated basis payment of
distributions out of money held by the Trust and payments upon redemption of
the Preferred Securities or liquidation of the Trust, as and to the extent
described under "Description of the Guarantees" in the accompanying Prospectus.
The Guarantee does not cover payment of distributions or amounts payable upon
redemption of the Preferred Securities or otherwise in respect of the Preferred
Securities when the Trust does not have legally and immediately available funds
sufficient to make such distributions or payments. In such event, the holders
of a majority in aggregate liquidation amount of the Preferred Securities may
direct the Property Trustee to enforce the Property Trustee's rights under the
Series Junior Subordinated Notes. In addition, a holder of Preferred
Securities may institute a legal proceeding directly against the Corporation,
without first instituting a legal proceeding against the Property Trustee or
any other person or entity, for enforcement of payment to that holder of
principal of or interest on the Series Junior Subordinated Notes having a
principal amount equal to the aggregate liquidation amount of the Preferred
Securities of that holder on or after the due dates specified or provided for
in the Series Junior Subordinated Notes. These mechanisms and obligations,
together with the Corporation's obligations under the Agreement as to Expenses
and Liabilities between the Corporation and the Trust, provide a full and
unconditional guarantee, subject to certain subordination provisions, by the
Corporation of the payments due on the Preferred Securities.
Distributions
Distributions on the Preferred Securities will be fixed at an annual rate of
% and will accrue from the date of original issuance of the Preferred
Securities. Except in the event of an Extension Period, distributions on the
Preferred Securities will be payable quarterly in arrears on March 31, June 30,
September 30 and December 31 of each year, commencing on , . If
distributions are to be made on the Preferred Securities on a date that is not
a Business Day, the distributions payable on that date will be paid on the next
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, the payment will be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on the date the
payment was originally payable. A "Business Day" means any day other than a
Saturday or Sunday, a day on which banks in New York City are authorized or
obligated by law or executive order to remain closed or a day on which the
principal corporate trust office of the Property Trustee or the Subordinated
Indenture Trustee is closed for business.
Distributions payable on any Distribution Date will be payable to holders of
record on the record date for that Distribution Date. The record date for a
Distribution Date is the close of business on the fifteenth calendar day
preceding that Distribution Date. Subject to any applicable laws and
regulations and the provisions of the Trust Agreement, each such payment will
be made as described under "--Book-Entry Only Issuance--DTC" below. The amount
of distributions payable for any period will be computed on the basis of a 360-
day year of twelve 30-day months.
S-14
<PAGE>
The Corporation has the right under the Subordinated Note Indenture to defer
payments of interest on the Series Junior Subordinated Notes by extending the
interest payment period from time to time on the Series Junior Subordinated
Notes, which, if exercised, would defer quarterly distributions on the
Preferred Securities during any such extended interest payment period. Deferred
installments of interest on the Series Junior Subordinated Notes will bear
interest at an annual rate of %, compounded quarterly, to the date of payment
to the extent permitted by applicable law. During an Extension Period, the
Corporation will have the right to make partial payments of interest on any
interest payment date on the Series Junior Subordinated Notes. If
distributions are deferred, the deferred distributions and accrued interest
thereon will be paid, if funds are legally available for such payments, to
holders of record of the Preferred Securities as they appear on the books and
records of the Trust on the record date next following the termination of that
Extension Period. See "Description of the Series Junior Subordinated Notes--
Interest" and "--Option to Extend Interest Payment Period."
Distributions on the Preferred Securities must be paid on the applicable
Distribution Dates to the extent that the Trust has funds legally and
immediately available for the payment of those distributions. The Trust's funds
available for distribution to the holders of the Preferred Securities will be
limited to payments received under the Series Junior Subordinated Notes. See
"Description of the Series Junior Subordinated Notes."
Redemption
The Preferred Securities are subject to mandatory redemption upon repayment
of the Series Junior Subordinated Notes at maturity or upon their earlier
redemption. The Series Junior Subordinated Notes will mature on , . The
Corporation may at its option redeem the Series Junior Subordinated Notes, in
whole or in part, at any time on or after , . The Corporation may also
redeem the Series Junior Subordinated Notes at any time, in whole, within 90
days following the occurrence of a Special Event. In each case the Redemption
Price will be equal to 100% of the principal amount of the Series Junior
Subordinated Notes to be redeemed plus accrued but unpaid interest (including
any Additional Interest as defined below) to the redemption date.
When the Corporation repays the Series Junior Subordinated Notes, whether
at maturity or upon redemption, the proceeds from that payment will
simultaneously be applied to redeem a like liquidation amount of Trust
Securities upon not less than 30 nor more than 60 days' notice at the
Redemption Price. If a partial redemption of the Series Junior Subordinated
Notes would result in the delisting of the Preferred Securities, the
Corporation may redeem the Series Junior Subordinated Notes only in whole.
See "Description of the Series Junior Subordinated Notes--Optional
Redemption."
If fewer than all the outstanding Preferred Securities are to be redeemed,
the Preferred Securities to be redeemed will be selected as described under
"--Book-Entry Only Issuance--DTC." If the Preferred Securities are no longer in
book-entry only form, the Preferred Securities to be redeemed will be selected
by such method as the Property Trustee deems fair and appropriate and which may
provide for the selection for redemption of portions (equal to $ or integral
multiples of $ ) of the aggregate liquidation amount of Preferred Securities
of a denomination larger than $ . Before undertaking the redemption of the
Preferred Securities on a basis other than pro rata,
S-15
<PAGE>
however, the Property Trustee is required to receive an opinion of counsel that
the status of the Trust as a grantor trust for United States federal income tax
purposes would not be adversely affected.
The Redemption Price for each Preferred Security will equal the liquidation
amount of $ plus accrued and unpaid distributions on the Preferred Security
to the date of payment.
Special Event Redemption or Distribution
The Corporation will have the option to redeem all the Series Junior
Subordinated Notes within 90 days after the occurrence of a Special Event, thus
causing the redemption of the Preferred Securities in whole. A Special Event is
either a Tax Event or an Investment Company Act Event.
A "Tax Event" means that the Administrative Trustees and the Corporation have
received an opinion of counsel experienced in such matters (which may be
counsel to the Corporation) to the effect that, as a result of (1) 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 (2) any amendment to, or
change in, an interpretation or application of such laws or regulations, there
is more than an insubstantial risk that (a) the Trust would be subject to
United States federal income tax with respect to income accrued or received on
the Series Junior Subordinated Notes, (b) interest payable on the Series
Junior Subordinated Notes would not be deductible by the Corporation for United
States federal income tax purposes or (c) the Trust would be subject to more
than a de minimis amount of other taxes, duties or other governmental charges,
which change or amendment becomes effective on or after the date of original
issuance of the Preferred Securities.
An "Investment Company Act Event" means that the Administrative Trustees and
the Corporation have received an opinion of counsel experienced in such matters
(which may be counsel to the Corporation) to the effect that, as a result of
the occurrence of a change in law or regulation or a written change in
interpretation or application of law or regulation by any legislative body,
court, governmental agency or regulatory authority on or after the date of
original issuance of the Preferred Securities, there is more than an
insubstantial risk that the Trust is or will be considered an "investment
company" under the Investment Company Act of 1940, which change becomes
effective on or after the date of original issuance of the Preferred
Securities.
Distribution of Series Junior Subordinated Notes upon Termination of Trust
The Corporation will have the right to terminate the Trust at any time and,
after satisfaction of liabilities to the Trust's creditors, cause Series
Junior Subordinated Notes to be distributed to the holders of the Preferred
Securities in liquidation of the Trust. See "--Liquidation Distribution upon
Dissolution." This right is optional and wholly within the discretion of the
Corporation. Circumstances under which the Corporation may determine to
exercise this right could include the occurrence of an Investment Company Act
Event or a Tax Event, adverse tax consequences to the Corporation or the Trust
that are not within the definition of a Tax Event because they do not result
from an amendment or change described in such definition, and changes in the
accounting requirements applicable to the Preferred Securities as described
under "Accounting Treatment" in the accompanying Prospectus.
S-16
<PAGE>
If Series Junior Subordinated Notes are distributed to the holders of the
Preferred Securities, the Corporation will use its best efforts to have the
Series Junior Subordinated Notes listed on the New York Stock Exchange or
other exchange on which the Preferred Securities are then listed.
After the date for any distribution of Series Junior Subordinated Notes
upon termination of the Trust:
. the Preferred Securities and the Guarantee will no longer be deemed to
be outstanding;
. the depositary or its nominee, as the record holder of the Preferred
Securities, will receive a registered global certificate or certificates
representing the Series Junior Subordinated Notes to be delivered upon
the distribution; and
. any certificates representing Preferred Securities not held by the
depositary or its nominee will be deemed to represent Series Junior
Subordinated Notes having an aggregate principal amount equal to the
aggregate liquidation amount of such Preferred Securities, an interest
rate identical to the rate at which cumulative cash dividends are
payable on such Preferred Securities, and accrued and unpaid interest
equal to accrued and unpaid distributions on such Preferred Securities,
until the certificates are presented to the Corporation or its agent for
transfer or reissuance.
There can be no assurance as to the market prices for the Preferred
Securities or the Series Junior Subordinated Notes that may be distributed in
exchange for the Preferred Securities if a termination and liquidation of the
Trust occurs. Accordingly, the Preferred Securities that an investor may
purchase, or the Series Junior Subordinated Notes that the investor may
receive on termination and liquidation of the Trust, may trade at a discount to
the price that the investor paid to purchase the Preferred Securities.
Redemption Procedures
If fewer than all the Trust Securities are to be redeemed, then the aggregate
liquidation amount of the Trust Securities to be redeemed will be allocated 97%
to the Preferred Securities and 3% to the Common Securities.
The Preferred Securities redeemed on any redemption date will be redeemed at
the Redemption Price with the proceeds from the contemporaneous redemption of
the Series Junior Subordinated Notes. The Redemption Price of Preferred
Securities will be deemed payable on each redemption date only to the extent
that the Trust has funds legally and immediately available for payment of such
Redemption Price.
If the Preferred Securities are in book-entry only form and the Property
Trustee gives a notice of redemption with respect to Preferred Securities
(which notice will be irrevocable), then, by 2:00 p.m., New York City time, on
the redemption date, subject to the immediately preceding paragraph, the
Property Trustee will irrevocably deposit with the securities depositary
sufficient funds to pay the applicable Redemption Price. See "--Book-Entry Only
Issuance--DTC" below. If the Preferred Securities are not in book-entry only
form, the Property Trustee, subject to the immediately preceding paragraph,
will irrevocably deposit with the paying agent funds sufficient to pay the
applicable Redemption Price and will give the paying agent irrevocable
instructions to pay the Redemption Price to the holders of the Preferred
Securities upon surrender of their Preferred
S-17
<PAGE>
Securities certificates. If notice of redemption has been given and funds
deposited as required, then immediately prior to the close of business on the
date of the deposit, distributions will cease to accrue and all rights of
holders of Preferred Securities called for redemption will cease, except the
right of the holders of those Preferred Securities to receive the Redemption
Price, but without interest on such Redemption Price. If the redemption date
for the redemption of Preferred Securities is not a Business Day, the
Redemption Price payable on that date will be paid on the next 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, the
payment will be made on the immediately preceding Business Day. If payment of
the Redemption Price for Preferred Securities is improperly withheld or refused
and not paid either by the Trust or by the Corporation under the Guarantee,
distributions on those Preferred Securities will continue to accrue at the then
applicable rate, from the redemption date originally established by the Trust
for those Preferred Securities to the date the Redemption Price is actually
paid. See "--Events of Default" below, "Relationship Among the Preferred
Securities, the Series Junior Subordinated Notes and the Guarantee" in this
Prospectus Supplement and "Description of the Guarantees--Events of Default" in
the accompanying Prospectus.
Subject to the foregoing and to applicable law (including, without
limitation, United States federal securities laws), the Corporation or any of
its affiliates may, at any time and from time to time, purchase outstanding
Preferred Securities by tender, in the open market or by private agreement.
Book-Entry Only Issuance--DTC
DTC will act as the initial securities depositary for the Preferred
Securities. The Preferred Securities will be issued only as fully registered
securities registered in the name of Cede & Co., DTC's nominee. One or more
fully registered global Preferred Securities certificates will be issued,
representing in the aggregate the total number of Preferred Securities, and
will be deposited with DTC.
DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Securities Exchange
Act of 1934. DTC holds securities that its participants ("Participants")
deposit with DTC. DTC also facilitates the settlement among Participants of
securities transactions, such as transfers and pledges, in deposited securities
through electronic computerized book-entry changes in Participants' accounts,
thereby eliminating the need for physical movement of securities certificates.
Direct Participants include securities brokers and dealers, banks, trust
companies, clearing corporations and certain other organizations ("Direct
Participants"). DTC is owned by a number of its Direct Participants and by the
New York Stock Exchange, the American Stock Exchange and the National
Association of Securities Dealers, Inc. Access to the DTC system is also
available to others such as securities brokers and dealers, banks and trust
companies that clear through or maintain a custodial relationship with a Direct
Participant, either directly or indirectly ("Indirect Participants"). The rules
applicable to DTC and its Participants are on file with the Commission.
S-18
<PAGE>
Purchases of Preferred Securities within the DTC system must be made by or
through Direct Participants, which will receive a credit for the Preferred
Securities on DTC's records. The ownership interest of each actual purchaser of
Preferred Securities ("Beneficial Owner") is in turn to be recorded on the
Direct and Indirect Participants' records. Beneficial Owners will not receive
written confirmation from DTC of their purchases, but Beneficial Owners are
expected to receive written confirmations providing details of the transactions,
as well as periodic statements of their holdings, from the Direct or Indirect
Participants through which the Beneficial Owners purchased Preferred
Securities. Transfers of ownership interests in the Preferred Securities are to
be accomplished by entries made on the books of Participants acting on behalf
of Beneficial Owners. Beneficial Owners will not receive certificates
representing their ownership interests in Preferred Securities, except in the
event that use of the book-entry system for the Preferred Securities is
discontinued.
DTC has no knowledge of the actual Beneficial Owners of the Preferred
Securities. DTC's records reflect only the identity of the Direct Participants
to whose accounts such Preferred Securities are credited, which may or may not
be the Beneficial Owners. The Participants will remain responsible for keeping
account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct Participants,
by Direct Participants to Indirect Participants, and by Direct Participants and
Indirect Participants to Beneficial Owners will be governed by arrangements
among them, subject to any statutory or regulatory requirements as may be in
effect from time to time.
Redemption notices shall be sent to DTC. If less than all the Preferred
Securities are being redeemed, DTC will reduce the amount of the interest of
each Direct Participant in the Preferred Securities in accordance with its
procedures.
Although voting with respect to the Preferred Securities is limited, in those
cases where a vote is required, neither DTC nor Cede & Co. will itself consent
or vote with respect to Preferred Securities. Under its usual procedures, DTC
would mail an Omnibus Proxy to the Trust as soon as possible after the record
date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to
those Direct Participants to whose accounts the Preferred Securities are
credited on the record date (identified in a listing attached to the Omnibus
Proxy).
Distributions, redemption proceeds and other payments in respect of the
Preferred Securities will be made to DTC. DTC's practice is to credit Direct
Participants' accounts on the relevant payment date in accordance with their
respective holdings shown on DTC's records unless DTC has reason to believe
that it will not receive payments on such payment date. Payments by
Participants to Beneficial Owners will be governed by standing instructions and
customary practices, as is the case with securities held for the account of
customers registered in "street name," and will be the responsibility of such
Participant and not of DTC, the Trust, any trustee or the Corporation, subject
to any statutory or regulatory requirements as may be in effect from time to
time. Payment of distributions, redemption proceeds and other amounts to DTC is
the responsibility of the Trust, disbursement of such payments to Direct
Participants is the responsibility of DTC, and disbursement of such payments to
the Beneficial Owners is the responsibility of Direct and Indirect
Participants.
Except as provided herein, a Beneficial Owner in a global Preferred Security
will not be entitled to receive physical delivery of Preferred Securities.
Accordingly, each Beneficial Owner must rely on the
S-19
<PAGE>
procedures of DTC to exercise any rights under the Preferred Securities. The
laws of some jurisdictions require that certain purchasers of securities take
physical delivery of securities in definitive form. Such laws may impair the
ability to transfer beneficial interests in a global Preferred Security.
DTC may discontinue providing its services as securities depositary with
respect to the Preferred Securities at any time by giving reasonable notice to
the Trust. Under such circumstances, in the event that a successor securities
depositary is not obtained within 90 days, Preferred Securities certificates
will be printed and delivered to the holders of record. Additionally, the
Corporation may decide to discontinue use of the system of book-entry transfers
through DTC (or a successor depositary) with respect to the Preferred
Securities. In that event, certificates for the Preferred Securities will be
printed and delivered to the holders of record.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from sources that the Corporation and the Trust believe to be
reliable, but the Corporation and the Trust take no responsibility for the
accuracy of such information. The Trust has no responsibility for the
performance by DTC or its Participants of their obligations as described in
this Prospectus Supplement and the accompanying Prospectus or under the rules
and procedures governing their respective operations.
Liquidation Distribution upon Dissolution
Pursuant to the Trust Agreement, the Trust will terminate on , , or
earlier upon:
. the occurrence of a Bankruptcy Event (as defined in the Trust Agreement)
in respect of the Corporation, dissolution or liquidation of the
Corporation, or dissolution of the Trust pursuant to a judicial decree;
. the delivery of written direction to the Property Trustee by the
Corporation, as depositor, at any time (which written direction is
optional and wholly within the discretion of the Corporation, as
depositor) to terminate the Trust and distribute the Series Junior
Subordinated Notes to the holders of the Preferred Securities and the
Common Securities in liquidation of the Trust; or
. the payment at maturity or redemption of all the Series Junior
Subordinated Notes, and the consequent payment of the Trust Securities.
If an early termination occurs upon the occurrence of a Bankruptcy Event in
respect of the Corporation, dissolution or liquidation of the Corporation or
dissolution of the Trust pursuant to a judicial decree or upon the delivery of
the written direction to the Property Trustee that is described in the
preceding paragraph, then the Trust will be liquidated, and the Property
Trustee will distribute to each holder of Trust Securities, after the
satisfaction of liabilities to creditors of the Trust, a like principal amount
of Series Junior Subordinated Notes, unless in the case of the occurrence of
a Bankruptcy Event in respect of the Corporation, dissolution or liquidation of
the Corporation or dissolution of the Trust pursuant to a judicial decree, the
Administrative Trustees determine such distribution not to be practical, in
which event such holders will be entitled to receive, out of the assets of the
Trust available for distribution to holders of the Trust Securities, after
satisfaction of liabilities to creditors, an amount equal to the aggregate of
the liquidation amount of $ per Trust Security plus accrued and unpaid
distributions on such Trust Securities to the date of payment (such
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amount being the "Liquidation Distribution"). If the Liquidation Distribution
can only be partially paid because the Trust has insufficient assets available
to pay the aggregate Liquidation Distribution in full, then, subject to the
following sentence, the amounts payable by the Trust on the Trust Securities
will be paid on a pro rata basis. The holder of the Common Securities will be
entitled to receive payments upon any such dissolution pro rata with the
holders of the Preferred Securities, except that the Preferred Securities will
have a preference over the Common Securities if an Event of Default under the
Subordinated Note Indenture with respect to the Series Junior Subordinated
Notes has occurred and is continuing.
Events of Default
Any one of the following events constitutes an "Event of Default" under the
Trust Agreement (whatever the reason for such Event of Default, and whether it
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):
. the occurrence of an Event of Default under the Subordinated Note
Indenture with respect to the Series Junior Subordinated Notes (see
"Description of the Junior Subordinated Notes--Events of Default" in the
accompanying Prospectus);
. default by the Trust in the payment of any distribution when it becomes
due and payable, and the continuation of such default for a period of 30
days;
. default by the Trust in the payment of any Redemption Price of any
Preferred Security or Common Security when it becomes due and payable;
. default in the performance, or breach, of any covenant or warranty of
the Securities Trustees in the Trust Agreement (other than a covenant or
warranty a default in the performance of which or the breach of which is
dealt with in one of the two immediately preceding Events of Default
under the Trust Agreement), and continuance of such default or breach
for a period of 60 days after there has been given, by registered or
certified mail, to the Securities Trustees by the holders of at least
25% in liquidation amount of the outstanding Preferred Securities a
written notice specifying the default or breach and requiring it to be
remedied and stating that such notice is a "Notice of Default" under the
Trust Agreement, unless holders in liquidation amount of outstanding
Preferred Securities not less than the liquidation amount of outstanding
Preferred Securities the holders of which gave such notice, agree in
writing to an extension of such period prior to its expiration;
provided, however, that the holders of such liquidation amount of
outstanding Preferred Securities will be deemed to have agreed to an
extension of such period if corrective action is initiated by the
Securities Trustees within such period and is being diligently pursued;
or
. the occurrence of certain events of bankruptcy or insolvency with
respect to the Trust.
Within 90 days after a default occurs under the Trust Agreement, the Property
Trustee will transmit notice of any such default known to the Property Trustee
to the holders of Trust Securities, the Administrative Trustees and the
Corporation, unless the default has been cured or waived. For this purpose, the
term "default" means any event which is, or after notice or lapse of time or
both would become, an Event of Default under the Trust Agreement.
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If an Event of Default under the Subordinated Note Indenture with respect to
the Series Junior Subordinated Notes occurs and is continuing, then pursuant
to the Trust Agreement:
. the holders of Preferred Securities will rely on the enforcement by the
Property Trustee of its rights against the Corporation as the holder of
the Series Junior Subordinated Notes; and
. the holders of a majority in aggregate liquidation amount of the
Preferred Securities will 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 under the Trust Agreement, including
the right to direct the Property Trustee to exercise the remedies
available to it as a holder of the Series Junior Subordinated Notes.
If the Property Trustee fails to enforce its rights under the Series Junior
Subordinated Notes, a holder of Preferred Securities may, to the extent
permitted by applicable law and as provided in the Trust Agreement, institute a
legal proceeding against the Corporation to enforce its rights under the Trust
Agreement without first instituting any legal proceeding against the Property
Trustee or any other person or entity, including the Trust. Notwithstanding the
foregoing, a holder of Preferred Securities may institute a legal proceeding
directly against the Corporation, without first instituting a legal proceeding
against the Property Trustee or any other person or entity, for enforcement of
payment to such holder of principal of or interest on the Series Junior
Subordinated Notes having a principal amount equal to the aggregate liquidation
amount of the Preferred Securities of such holder on or after the due dates
specified in the Series Junior Subordinated Notes. See "Relationship Among
the Preferred Securities, the Series Junior Subordinated Notes and the
Guarantee" in this Prospectus Supplement and "Description of the Guarantees--
Events of Default" in the accompanying Prospectus.
Unless an Event of Default under the Subordinated Note Indenture with respect
to the Series Junior Subordinated Notes has occurred and is continuing, the
holder of the Common Securities may remove the Securities Trustees at any time.
If such an Event of Default has occurred and is continuing, the holders of a
majority in liquidation amount of the Preferred Securities may remove the
Property Trustee and the Delaware Trustee by act of such holders delivered to
the appropriate Securities Trustee (in its individual capacity and on behalf of
the Trust). No resignation or removal of any Securities Trustee and no
appointment of a successor will be effective until the successor Trustee
accepts its appointment in accordance with the Trust Agreement.
If an Event of Default under the Subordinated Note Indenture with respect to
the Series Junior Subordinated Notes has occurred and is continuing, the
holders of Preferred Securities will have a preference over the holders of
Common Securities upon dissolution of the Trust as described above. See
"--Liquidation Distribution upon Dissolution."
Voting Rights
Except as described in "--Amendment of the Trust Agreement" in this
Prospectus Supplement, in "Description of the Guarantees--Amendments and
Assignment" in the accompanying Prospectus and in the immediately succeeding
paragraphs, and except as otherwise required by law and the Trust Agreement,
the holders of the Preferred Securities will have no voting rights.
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So long as the Property Trustee holds any Series Junior Subordinated Notes,
the Securities Trustees will not:
. direct the time, method and place of conducting any proceeding for any
remedy available to the Subordinated Indenture Trustee, or executing any
trust or power conferred on the Subordinated Indenture Trustee with
respect to the Series Junior Subordinated Notes;
. consent to waive any past default which is waivable under Section 513 of
the Subordinated Note Indenture;
. exercise any right to rescind or annul a declaration that the principal
of all the Series Junior Subordinated Notes will be due and payable;
or
. consent to any amendment, modification or termination of the
Subordinated Note Indenture or the Series Junior Subordinated Notes,
where such consent is required, or to any other action, as the holder of
the Series Junior Subordinated Notes, under the Subordinated Note
Indenture,
without, in each case, obtaining the prior approval of the holders of at least
66 2/3% in liquidation amount of the outstanding Preferred Securities, except
that where a consent under the Subordinated Note Indenture requires the consent
of each holder of Series Junior Subordinated Notes affected, the Securities
Trustees will not give such consent without the prior consent of each such
holder of Preferred Securities. The Securities Trustees will not revoke any
action that a vote of the holders of the Preferred Securities has previously
authorized or approved, except pursuant to a subsequent vote of such holders.
The Property Trustee will notify all holders of the Preferred Securities of
any notice of default that it receives from the Subordinated Indenture Trustee
with respect to the Series Junior Subordinated Notes.
If any proposed amendment to the Trust Agreement provides for, or the
Securities Trustees otherwise propose to effect, (1) any action that would
adversely affect the powers, preferences or special rights of the Preferred
Securities, whether by way of amendment to the Trust Agreement or otherwise, or
(2) the dissolution, winding-up or termination of the Trust, other than
pursuant to the Trust Agreement, then the holders of outstanding Preferred
Securities will be entitled to vote as a class on such amendment or proposal.
The approval of the holders of at least 66 2/3% in liquidation amount of the
outstanding Preferred Securities will be required in order for such amendment
or proposal to be effective.
Holders of Preferred Securities may give any required approval at a separate
meeting of holders of Preferred Securities convened for that purpose or may
give any required approval by written consent. The Administrative Trustees will
cause a notice of any meeting at which holders of Preferred Securities are
entitled to vote to be given to each holder of record of Preferred Securities
in the manner set forth in the Trust Agreement.
Any Preferred Securities that the Corporation, the Administrative Trustees or
any affiliate of the Corporation or any Administrative Trustee owns, whether of
record or beneficially, will be treated as if those Preferred Securities were
not outstanding for purposes of such vote or consent.
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Co-Property Trustees and Separate Property Trustee
At any time or times, for the purpose of meeting the legal requirements of
the Trust Indenture Act of 1939 or of any jurisdiction in which any part of the
Trust Property may be located, the holder of the Common Securities and the
Property Trustee will have power to appoint one or more persons approved by the
Property Trustee either to act as co-property trustee, jointly with the
Property Trustee, of all or any part of the Trust 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 the Trust Agreement. Upon the
written request of the Property Trustee, the Corporation, as depositor, will
join with the Property Trustee in the execution, delivery and performance of
all instruments and agreements necessary or proper for the appointment. If the
Corporation, as depositor, does not join in the appointment within 15 days
after it receives a request to do so, or in case an Event of Default under the
Subordinated Note Indenture with respect to the Series Junior Subordinated
Notes has occurred and is continuing, the Property Trustee alone will have
power to make the appointment.
Amendment of the Trust Agreement
The Corporation and the Securities Trustees may amend the Trust Agreement
from time to time without the consent of the holders of the Trust Securities:
. to cure any ambiguity, correct or supplement any provision which may be
inconsistent with any other provision of the Trust Agreement, or to make
any other provisions with respect to matters or questions arising under
the Trust Agreement, which shall not be inconsistent with the other
provisions of the Trust Agreement; provided that the amendment does not
adversely affect in any material respect the interests of any holder of
Trust Securities; or
. to modify, eliminate or add to any provisions of the Trust Agreement to
such extent as shall be necessary to ensure that the Trust will not be
classified as other than a grantor trust for United States federal
income tax purposes.
Except as provided in the next paragraph, other amendments to the Trust
Agreement may be made if (1) the holders of 66 2/3% in aggregate liquidation
amount of the Trust Securities then outstanding approve any such amendment and
(2) the Securities Trustees receive an opinion of counsel to the effect that
such amendment will not affect the Trust's status as a grantor trust or the
Trust's exemption from the Investment Company Act of 1940.
The consent of each affected holder of Trust Securities will be required,
however, to amend the Trust Agreement to:
. change the amount or timing of any distribution (or any payment upon
redemption) on the Trust Securities or otherwise adversely affect the
amount of any distribution (or any payment upon redemption) required to
be made in respect of the Trust Securities as of a specified date;
. restrict the right of a holder of Trust Securities to institute suit for
the enforcement of any such payment on or after such date;
. change the purpose of the Trust;
. authorize the issuance of any additional beneficial interests in the
Trust; or
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. change the consent required to amend the Trust Agreement.
Mergers, Consolidations or Amalgamations
The Trust may not consolidate, amalgamate, merge with or into any corporation
or other entity, or be replaced by, or convey, transfer or lease its properties
and assets substantially as an entirety to any corporation or other entity,
except as described below. The Trust may, at the request of the Corporation,
with the consent of the Administrative Trustees and without the consent of the
holders of the Trust Securities, consolidate, amalgamate, merge with or into,
or be replaced by a trust organized as such under the laws of any state;
provided that:
. the successor entity either (1) expressly assumes all the Trust's
obligations with respect to the Trust Securities or (2) substitutes for
the Preferred 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;
. the Corporation expressly appoints a trustee of such successor entity
possessing the same powers and duties as the Property Trustee as the
holder of the Series Junior Subordinated Notes;
. the Preferred Securities or any Successor Securities are listed, or any
Successor Securities will be listed upon notification of issuance, on
any national securities exchange or other organization on which the
Preferred Securities are then listed;
. the consolidation, amalgamation, merger or replacement does not cause
the Preferred Securities (including any Successor Securities) to be
downgraded by any nationally recognized statistical rating organization;
. the consolidation, amalgamation, merger or replacement does not
adversely affect the rights, preferences and privileges of the holders
of the Trust Securities (including any Successor Securities) in any
material respect;
. the successor entity has a purpose substantially identical to that of
the Trust;
. prior to the consolidation, amalgamation, merger or replacement, the
Corporation and the Property Trustee have received an opinion of counsel
to the effect that (1) the consolidation, amalgamation, merger or
replacement 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 (2) following the
consolidation, amalgamation, merger or replacement, neither the Trust
nor the successor entity will be required to register as an "investment
company" under the Investment Company Act of 1940; and
. the Corporation owns all the common securities of the successor entity
and guarantees the obligations of the successor entity with respect to
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 any other entity or permit
any other entity to consolidate, amalgamate, merge with or into, or replace it
if such consolidation, amalgamation, merger or replacement would cause the
Trust
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or the successor entity to be classified as other than a grantor trust for
United States federal income tax purposes.
Any corporation or other entity into which the Property Trustee, the Delaware
Trustee or any Administrative Trustee that is not a natural person may be
merged or converted or with which it may be consolidated, or any corporation or
other entity resulting from any merger, conversion or consolidation to which
any Securities Trustee is a party, or any corporation or other entity
succeeding to all or substantially all the corporate trust business of any
Securities Trustee, will be the successor of such Securities Trustee under the
Trust Agreement; provided that such corporation or other entity is otherwise
qualified and eligible.
Payment and Paying Agent
So long as DTC is acting as securities depositary for the Preferred
Securities, payments on the Preferred Securities will be made to DTC, which
will credit the relevant accounts at DTC on the applicable Distribution Dates.
If the Preferred Securities are no longer held by DTC, such payments will be
made by check mailed to the address of the holder entitled to the payment as
such address appears in the Security Register (as defined in the Trust
Agreement). The paying agent will initially be the Property Trustee. The paying
agent will be permitted to resign as paying agent upon 30 days' written notice
to the Administrative Trustees and the Corporation. Upon such resignation, the
Administrative Trustees will appoint a successor to act as paying agent.
Registrar and Transfer Agent
It is anticipated that the Property Trustee, or one of its affiliates, will
act as registrar and transfer agent for the Preferred Securities.
Registration of transfers of Preferred Securities will be effected without
charge by or on behalf of the Trust, but upon payment in respect of any tax or
other governmental charges which may be imposed in relation to it.
The registrar and transfer agent for the Preferred Securities will not be
required to register or cause to be registered any transfer of Preferred
Securities that have been called for redemption.
Information Concerning the Property Trustee
Prior to the occurrence of an Event of Default under the Trust Agreement, the
Property Trustee undertakes to perform only those duties as are specifically
set forth in the Trust Agreement and, after default, will exercise the same
degree of care as a prudent individual would exercise in the conduct of his or
her own affairs. Subject to such provisions, the Property Trustee is under no
obligation to exercise any of the powers vested in it by the Trust Agreement at
the request of any holder of Preferred Securities, unless offered reasonable
indemnity by such holder against the costs, expenses and liabilities which the
Property Trustee might incur as a result.
The Chase Manhattan Bank, which is the Property Trustee, also serves as
Subordinated Indenture Trustee and as Guarantee Trustee. The Chase Manhattan
Bank also serves as Trustee under the Corporation's Senior Note Indenture. The
Corporation and certain of its affiliates maintain deposit accounts and banking
relationships with The Chase Manhattan Bank.
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Governing Law
The Trust Agreement and the Trust Securities will be governed by the internal
laws of the State of Delaware, except that New York law will govern the
immunities and standard of care of the Property Trustee.
Miscellaneous
The Trust Agreement authorizes and directs the Administrative Trustees to
operate the Trust so that the Trust will not be deemed to be an "investment
company" required to be registered under the Investment Company Act of 1940 or
taxed as other than a grantor trust for United States federal income tax
purposes. The Trust Agreement also authorizes and directs the Administrative
Trustees to operate the Trust so that the Series Junior Subordinated Notes will
be treated as indebtedness of the Corporation for United States federal income
tax purposes. In such connection, the Administrative Trustees and the
Corporation are authorized to take any action that is not inconsistent with
applicable law, the Trust's certificate of trust or the Trust Agreement, that
the Administrative Trustees and the Corporation determine in their discretion
to be necessary or desirable for such purposes, as long as the action does not
materially and adversely affect the interests of the holders of the Preferred
Securities.
DESCRIPTION OF THE SERIES JUNIOR SUBORDINATED NOTES
A description of the terms of the Series Junior Subordinated Notes is set
forth below. This description supplements, and should be read together with,
the description of the general terms and provisions of the Junior Subordinated
Notes set forth in the accompanying Prospectus under "Description of the Junior
Subordinated Notes." The following description does not purport to be complete
and is subject to, and is qualified in its entirety by reference to, the
description in the accompanying Prospectus and the Subordinated Note Indenture.
Certain capitalized terms used in this description are defined in the
Subordinated Note Indenture.
General
The Corporation will issue the Series Junior Subordinated Notes as a series
of Junior Subordinated Notes under the Subordinated Note Indenture. The Series
Junior Subordinated Notes will be limited in aggregate principal amount to
$ , which is the aggregate liquidation amount of the Trust Securities.
The entire principal amount of the Series Junior Subordinated Notes will
mature and become due and payable, together with any accrued and unpaid
interest thereon (including any Additional Interest (as defined under
"--Additional Interest" below)), on , . The Series Junior
Subordinated Notes are not subject to any sinking fund provision.
The interest rate and interest and other payment dates of the Series Junior
Subordinated Notes will correspond to those of the Preferred Securities as
described in this Prospectus Supplement.
The Series Junior Subordinated Notes will rank equal in priority with the
other series of Junior Subordinated Notes issued under the Subordinated Note
Indenture.
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Optional Redemption
The Corporation will have the right to redeem the Series Junior
Subordinated Notes, in whole or in part, without premium, from time to time, on
or after , , or at any time, in whole, within 90 days after a Special
Event (as described in "Description of the Preferred Securities--Special Event
Redemption or Distribution") occurs, upon not less than 30 nor more than 60
days' notice, at a Redemption Price equal to 100% of the principal amount to be
redeemed plus any accrued and unpaid interest (including any Additional
Interest) to the redemption date. If a partial redemption of the Series
Junior Subordinated Notes would result in the delisting of the Preferred
Securities, the Corporation may redeem the Series Junior Subordinated Notes
only in whole.
Interest
Each Series Junior Subordinated Note will bear interest at an annual rate
of % from the date of original issuance, payable, unless deferred, quarterly
in arrears on March 31, June 30, September 30 and December 31 of each year,
commencing on , . Such interest will be payable to the person in whose
name such Series Junior Subordinated Note is registered at the close of
business on the fifteenth calendar day prior to such interest payment date,
except that interest payable on the stated maturity of principal of the Series
Junior Subordinated Notes or on a redemption date will be paid to the person to
whom principal is payable. The amount of interest payable will be computed on
the basis of a 360-day year of twelve 30-day months. If any date on which
interest is payable on the Series Junior Subordinated Notes is not a Business
Day, the interest payable on such date will be paid on the next 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
interest will be paid on the immediately preceding Business Day, in each case
with the same force and effect as if made on the date the payment was
originally payable.
Option to Extend Interest Payment Period
The Corporation will have the right at any time, and from time to time, to
defer payments of interest on the Series Junior Subordinated Notes by
extending the interest payment period for up to 20 consecutive quarters, but
not beyond the maturity date. When an Extension Period has terminated, the
Corporation will pay all interest then accrued and unpaid (including any
Additional Interest) on the next interest payment date. Prior to the
termination of any Extension Period, the Corporation may further defer payments
of interest by extending the interest payment period, except that such
Extension Period, together with all such previous and further extensions
thereof, may not exceed 20 consecutive quarters. During an Extension Period,
the Corporation will have the right to make partial payments of interest on any
interest payment date. Upon the termination of any Extension Period and the
payment of all amounts then due, the Corporation may select a new Extension
Period, subject to the previously mentioned requirements. The Corporation has
no present intention of exercising its right to defer payments of interest by
extending the interest payment period on the Series Junior Subordinated Notes.
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The Corporation will give the holder or holders of the Series Junior
Subordinated Notes and the Subordinated Indenture Trustee notice of its
selection or extension of an Extension Period at least one Business Day prior
to the earlier of:
. the record date relating to the interest payment date on which the
Extension Period is to commence or relating to the interest payment date
on which an Extension Period that is being extended would otherwise
terminate; or
. the date the Corporation or the Trust is required to give notice to the
New York Stock Exchange or other applicable self-regulatory organization
of the record date or the date such distributions are payable.
Additional Interest
"Additional Interest" with respect to the Series Junior Subordinated Notes
is defined in the Subordinated Note Indenture as (1) such additional amounts as
may be required so that the net amounts received and retained by a holder of
Series Junior Subordinated Notes (if the holder is the Trust) after paying
taxes, duties, assessments or governmental charges of whatever nature (other
than withholding taxes) imposed by the United States or any other taxing
authority will not be less than the amounts the holder would have received had
no such taxes, duties, assessments or other governmental charges been imposed;
and (2) such interest as shall accrue on interest due and not paid on an
interest payment date, accruing at an annual rate of % from the applicable
interest payment date to the date of payment, compounded quarterly, on each
interest payment date, to the extent permitted by applicable law.
Certain Covenants
The Corporation covenants in the Subordinated Note Indenture, for the benefit
of the holders of Series Junior Subordinated Notes and the holders of the
Preferred Securities, that, (1) if the Corporation has given notice of its
election to extend an interest payment period for the Series Junior
Subordinated Notes and such extension is continuing or (2) if an Event of
Default under the Subordinated Note Indenture with respect to the Series
Junior Subordinated Notes has occurred and is continuing, (x) the Corporation
will not declare or pay any dividend or make any distributions with respect to,
or redeem, purchase, acquire or make a liquidation payment with respect to, any
of its capital stock, and (y) the Corporation will not make any payment of
interest, principal or premium, if any, on or repay, repurchase or redeem any
debt securities (including guarantees other than the Guarantee) issued by the
Corporation which rank equal in priority with or junior to the Series Junior
Subordinated Notes. These covenants, however, shall not restrict (1) any of the
actions described in the preceding sentence resulting from any reclassification
of the Corporation's capital stock or the exchange or conversion of one class
or series of the Corporation's capital stock for another class or series of the
Corporation's capital stock or (2) dividends or distributions in capital stock
of the Corporation.
The Corporation also covenants in the Subordinated Note Indenture that, for
so long as the Trust Securities remain outstanding, the Corporation will (1)
directly or indirectly maintain 100% ownership of the Common Securities of the
Trust (provided, however, that any successor of the Corporation permitted under
the Subordinated Note Indenture may succeed to the Corporation's
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ownership of the Common Securities) and (2) use its reasonable efforts to cause
the Trust (x) to remain a statutory business trust, except in connection with
the distribution of Series Junior Subordinated Notes to the holders of Trust
Securities in liquidation of such Trust, the redemption of all the Trust
Securities of the Trust, or certain mergers, consolidations or amalgamations,
each as permitted by the Trust Agreement, and (y) to otherwise continue to be
classified as a grantor trust for United States federal income tax purposes.
Book-Entry and Issuance
The Series Junior Subordinated Notes are expected to be issued in the form
of one or more global certificates registered in the name of the securities
depositary or its nominee if distributed to holders of Trust Securities in
connection with the voluntary or involuntary dissolution, winding-up or
liquidation of the Trust. In such event, the procedures applicable to the
transfer and payment of the Series Junior Subordinated Notes are expected to
be substantially similar to those described with respect to the Preferred
Securities in "Description of the Preferred Securities--Book-Entry Only
Issuance--DTC."
Denominations
The Series Junior Subordinated Notes will be issuable in registered form
without coupons in denominations of $ or any integral multiples of $ .
Defeasance
The Series Junior Subordinated Notes will be subject to Defeasance as
described in the Subordinated Note Indenture. See "Description of the Junior
Subordinated Notes--Defeasance and Covenant Defeasance" in the accompanying
Prospectus.
Under current United States federal income tax laws, Defeasance would be
treated as an exchange of the relevant Series Junior Subordinated Notes in
which holders of such Series Junior Subordinated Notes might recognize gain
or loss. In addition, the amount, timing and character of amounts that holders
would be required thereafter to include in income might be different from that
which would be includible in the absence of such Defeasance. Prospective
investors are urged to consult their own tax advisors as to the specific
consequences of a Defeasance, including the applicability and effect of tax
laws other than United States federal income tax laws.
The Series Junior Subordinated Notes will not be subject to Covenant
Defeasance as described in the Subordinated Note Indenture. See "Description of
the Junior Subordinated Notes--Defeasance and Covenant Defeasance" in the
accompanying Prospectus.
Miscellaneous
The Corporation will have the right at all times to assign any of its rights
or obligations under the Subordinated Note Indenture with respect to the Series
Junior Subordinated Notes to one of its direct or indirect wholly owned
subsidiaries; provided that the Corporation will remain primarily liable for
the performance of all such obligations in the event of any such assignment.
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RELATIONSHIP AMONG THE PREFERRED SECURITIES,
THE SERIES JUNIOR SUBORDINATED NOTES AND THE GUARANTEE
As long as payments of interest and other payments on the Series Junior
Subordinated Notes are made when due, those payments will be sufficient to
cover distributions and payments due on the Trust Securities primarily because:
. the aggregate principal amount of Series Junior Subordinated Notes will
be equal to the aggregate liquidation amount of the Trust Securities;
. the interest rate and interest and other payment dates on the Series
Junior Subordinated Notes will correspond to the distribution rate and
distribution and other payment dates for the Preferred Securities;
. the Corporation will pay for all costs and expenses of the Trust
pursuant to the Agreement as to Expenses and Liabilities between the
Corporation and the Trust; and
. the Trust Agreement provides that the Securities Trustees will not
cause or permit the Trust to, among other things, engage in any
activity that is not consistent with the purposes of the Trust.
The Corporation will guarantee payments of distributions and other payments
due on the Preferred Securities (in each case to the extent funds are legally
and immediately available therefor) as and to the extent set forth under
"Description of the Guarantees" in the accompanying Prospectus. If the
Corporation does not make the required payments on the Series Junior
Subordinated Notes, it is not expected that the Trust will have sufficient
funds to make the related distributions on the Preferred Securities. The
Guarantee is a guarantee from the time of its issuance, but does not apply to
any payment of distributions unless and until the Trust has sufficient funds
legally and immediately available for the payment of such distributions.
If an Event of Default under the Subordinated Note Indenture with respect to
the Series Junior Subordinated Notes occurs and is continuing, then:
. the holders of Preferred Securities will rely on the enforcement by the
Property Trustee of its rights against the Corporation as the holder of
the Series Junior Subordinated Notes; and
. the holders of a majority in aggregate liquidation amount of the
Preferred Securities will 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 under the Trust Agreement, including
the right to direct the Property Trustee to exercise the remedies
available to it as a holder of the Series Junior Subordinated Notes.
If the Property Trustee fails to enforce its rights under the Series Junior
Subordinated Notes, a holder of Preferred Securities may, to the extent
permitted by applicable law and as provided in the Trust Agreement, institute a
legal proceeding against the Corporation to enforce its rights under the Trust
Agreement without first instituting any legal proceeding against the Property
Trustee or any other person or entity, including the Trust. Notwithstanding the
foregoing, a holder of Preferred Securities may institute a legal proceeding
directly against the Corporation, without first instituting a legal proceeding
against the Property Trustee or any other person or entity, for enforcement of
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payment to such holder of principal of or interest on the Series Junior
Subordinated Notes having a principal amount equal to the aggregate liquidation
amount of the Preferred Securities of such holder on or after the due dates
specified in the Series Junior Subordinated Notes. The Trust Agreement also
provides a mechanism whereby the holders of Preferred Securities may appoint a
substitute Property Trustee if an Event of Default under the Subordinated Note
Indenture with respect to the Series Junior Subordinated Notes occurs and is
continuing.
If the Corporation fails to make payments under the Guarantee, the Guarantee
provides a mechanism whereby the holders of the Preferred Securities may direct
the Guarantee Trustee to enforce its rights under the Guarantee. In addition,
any holder of Preferred Securities may institute a legal proceeding directly
against the Corporation to enforce its rights under the Guarantee without first
instituting a legal proceeding against the Guarantee Trustee or any other
person or entity.
The Guarantee, the Subordinated Note Indenture, the Series Junior
Subordinated Notes, the Trust Agreement and the Agreement as to Expenses and
Liabilities between the Corporation and the Trust, as described above, provide
a full and unconditional guarantee, subject to certain subordination
provisions, by the Corporation of the payments due on the Preferred Securities.
The holders of Preferred Securities will be entitled to receive, out of
assets legally available for distribution to holders, the Liquidation
Distribution in cash upon any voluntary or involuntary dissolution, winding-up
or termination of the Trust unless the Series Junior Subordinated Notes are
distributed in connection therewith. See "Description of the Preferred
Securities--Liquidation Distribution upon Dissolution." Upon any voluntary or
involuntary liquidation or bankruptcy of the Corporation, the Property Trustee,
as holder of the Series Junior Subordinated Notes, would be a subordinated
creditor of the Corporation, subordinated in right of payment to all Senior
Indebtedness, but entitled to receive payment in full of principal and interest
before the shareholder of the Corporation receives payments or distributions.
Because the Corporation is guarantor under the Guarantee and has agreed to pay
for all costs, expenses and liabilities of the Trust (other than the Trust's
obligations to holders of the Preferred Securities) under the Agreement as to
Expenses and Liabilities between the Corporation and the Trust, the positions
of a holder of Preferred Securities and a holder of Series Junior
Subordinated Notes relative to other creditors and the shareholder of the
Corporation in the event of liquidation or bankruptcy of the Corporation would
be substantially the same.
A default or event of default under any Senior Indebtedness would not
constitute a default or an Event of Default under the Subordinated Note
Indenture with respect to the Series Junior Subordinated Notes. However, in
the event of a default with respect to Senior Indebtedness or the acceleration
of Senior Indebtedness, the subordination provisions of the Series Junior
Subordinated Notes provide that no payments may be made in respect of the
Series Junior Subordinated Notes:
. until such Senior Indebtedness has been paid in full (in the case of any
payment by, or distribution of assets of, the Corporation to creditors
upon any dissolution, winding-up, liquidation or reorganization of the
Corporation); or
. until all amounts due on such Senior Indebtedness have been paid (in the
case of a payment default thereunder (beyond any period of grace) or the
acceleration of the maturity of such Senior Indebtedness because of a
default with respect to such Senior Indebtedness).
S-32
<PAGE>
Failure to make required payments on the Series Junior Subordinated Notes
would (with the lapse of time, in the case of defaults in the payment of
interest) constitute an Event of Default under the Subordinated Note Indenture
with respect to the Series Junior Subordinated Notes, except that failure to
make interest payments on the Series Junior Subordinated Notes will not be
such an Event of Default during an Extension Period.
MATERIAL FEDERAL INCOME TAX CONSIDERATIONS
The following is the opinion of Dewey Ballantine LLP, counsel to the
Corporation and the Trust, as to the material United States income tax
consequences of the purchase, ownership and disposition of the Preferred
Securities, insofar as it relates to matters of law and legal conclusions. This
discussion deals only with Preferred Securities held as capital assets within
the meaning of the Internal Revenue Code of 1986, as amended to the date hereof
(the "Code"), by Holders (as defined herein) that acquire Preferred Securities
on their original issue at their original offering price. Moreover, it does not
include all of the tax consequences that may be important to a Holder in light
of the Holder's particular circumstances or to Holders subject to special
rules, such as certain financial institutions, real estate investment trusts,
regulated investment companies, insurance companies, tax-exempt organizations,
dealers in securities or currencies, individual retirement and certain tax
deferred accounts, and persons who engage in a straddle or a hedge relating to
a Preferred Security. Prospective investors should consult their own tax
advisors with regard to the application of the tax considerations discussed
below to their particular situations as well as the application of any state,
local or other tax laws. This discussion is based on laws, existing and
proposed regulations, and applicable judicial and administrative
determinations, all of which are subject to change at any time, and any such
changes may be retroactively applied in a manner that could adversely affect
Holders. As used herein, the term "Holder" means a beneficial owner of a
Preferred Security that for United States federal income tax purposes is (1) a
citizen or resident of the United States, (2) a corporation, partnership or
other entity created or organized in or under the laws of the United States or
of any political subdivision thereof, (3) an estate the income of which is
subject to United States federal income taxation regardless of its source and
(4) a trust if (a) a court within the United States is able to exercise primary
supervision over the administration of the trust and (b) one or more U.S.
persons have the authority to control all substantial decisions of the trust.
The following discussion does not address any tax consequences that apply
specifically to nonresident aliens or foreign entities.
Treatment of the Trust and Preferred Securities for Federal Income Tax Purposes
The Trust will be treated as a "grantor trust" and not as an association
taxable as a corporation for federal income tax purposes. Thus, for federal
income tax purposes, each Holder will be treated as the beneficial owner of a
pro rata undivided interest in the Series Junior Subordinated Notes and,
consequently, will be required to include in income the Holder's pro rata share
of the entire income from the Series Junior Subordinated Notes. Each Holder
generally will determine its net income or loss with respect to the Trust in
accordance with its own method of accounting, although income arising from
original issue discount, if any, must be taken into account under the accrual
method of accounting even if the Holder otherwise would use the cash receipts
and disbursements method.
S-33
<PAGE>
Original Issue Discount
Under applicable income tax regulations, the Corporation believes that the
Series Junior Subordinated Notes will not be treated as issued with original
issue discount. It should be noted that these regulations have not yet been
addressed in any rulings or other interpretations by the Internal Revenue
Service. Accordingly, it is possible that the Internal Revenue Service could
take a position contrary to the interpretations described herein. Should the
Corporation exercise its option to defer payments of interest, the Series
Junior Subordinated Notes would at that time be treated as issued with original
issue discount, and all the stated interest payments on the Series Junior
Subordinated Notes would thereafter be treated as original issue discount for
so long as they remained outstanding. As a result, all Holders would, in
effect, be required to accrue interest income even if such Holders are on a
cash method of accounting. Consequently, in the event that the payment of
interest is deferred, a Holder could be required to include original issue
discount in income on an economic accrual basis, notwithstanding that the
Corporation will not make any interest payments during such period on the
Series Junior Subordinated Notes.
Because income on the Preferred Securities will constitute interest or
original issue discount, corporate Holders will not be entitled to a dividends-
received deduction with respect to any income recognized with respect to the
Preferred Securities.
Sale of Preferred Securities
Upon the sale, retirement (including redemption) or other taxable disposition
of all or part of a Preferred Security, a Holder thereof will recognize gain or
loss equal to the difference between the
amount realized on such sale, retirement or other disposition and such Holder's
adjusted tax basis in the Preferred Security or part thereof. If the Holder
disposes of a Preferred Security prior to the occurrence of an Extension
Period, any portion of the amount received that is attributable to accrued
interest will be treated as interest income to the Holder and will not be
treated as part of the amount realized for purposes of determining gain or loss
on the disposition of the Preferred Security. Any recognized gain or loss will
be capital gain or loss, and such capital gain or loss will be long-term if the
holding period for the Preferred Security is more than one year at the time of
sale, retirement or other disposition. In the case of a Holder that is an
individual, estate or trust, "net capital gain," i.e., the excess of net long-
term capital gain over net short-term capital loss, is generally subject to a
reduced rate of federal income tax. A Holder's adjusted tax basis in a
Preferred Security acquired by purchase will generally equal the cost of such
Preferred Security to the Holder, increased by the amount of any related
accrued original issue discount included in taxable income by the Holder and
reduced by any prior payments on the Series Junior Subordinated Notes
distributed with respect to the Preferred Security. The redemption of only part
of a Preferred Security will require an allocation of the Holder's pro rata
share of the adjusted issue price of the related Series Junior Subordinated
Notes between the portion of the Series Junior Subordinated Notes redeemed
and the portion retained by the Holder in order to determine gain or loss.
Receipt of Series Junior Subordinated Notes upon Liquidation of the Trust
As described under "Description of the Preferred Securities--Distribution of
Series Junior Subordinated Notes upon Termination of Trust," Series Junior
Subordinated Notes may be distributed to Holders in exchange for the Preferred
Securities and in liquidation of the Trust. Such a
S-34
<PAGE>
distribution would be treated as a non-taxable event to each Holder, and each
Holder would receive an aggregate tax basis in the Holder's Series Junior
Subordinated Notes equal to the Holder's aggregate tax basis in its Preferred
Securities. A Holder's holding period with respect to the Series Junior
Subordinated Notes so received in liquidation of the Trust would include the
period for which the Preferred 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 Series Junior Subordinated Notes would
constitute a taxable event to Holders of Preferred Securities, and a Holder's
holding period in Series Junior Subordinated Notes would begin on the date
such Series Junior Subordinated Notes were received.
Information Reporting to Holders
Income on the Preferred Securities will be reported to Holders on Form 1099,
which form should be mailed to Holders of Preferred Securities by January 31
following each calendar year.
Backup Withholding
A Holder may be subject to "backup withholding" under certain circumstances.
Backup withholding applies to a Holder if the Holder, among other things, (1)
fails to furnish his social security number or other taxpayer identification
number ("TIN") to the payor responsible for backup withholding (for example,
the Holder's securities broker), (2) furnishes such payor an incorrect TIN, (3)
fails to provide such payor with a certified statement, signed under penalties
of perjury, that the TIN provided to the payor is correct and that the Holder
is not subject to backup withholding or (4) fails to report properly interest
and dividends on his tax return. Backup withholding, however, does not apply to
payments made to certain exempt recipients, such as corporations and tax-exempt
organizations. The backup withholding rate is 31% of "reportable payments,"
which generally will include distributions of interest and principal payments
on the Series Junior Subordinated Notes and payment of the proceeds from the
disposition of Preferred Securities. Any amount withheld from a Holder under
the backup withholding rules will be allowed as a refund or a credit against
such Holder's United States federal income tax liability, provided the required
information is furnished to the Internal Revenue Service.
The federal income tax discussion set forth above may not be applicable to a
holder, depending upon a holder's particular situation, and therefore each
holder should consult his tax advisor with respect to the tax consequences of
the ownership and disposition of Preferred Securities, including the tax
consequences under state, local, foreign and other tax laws and the possible
effects of changes in federal or other tax law.
S-35
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in an Underwriting Agreement,
the Trust has agreed to sell to each of the Underwriters named below, and each
of such Underwriters, for whom , and are acting as
Representatives, has severally agreed to purchase, the number of Preferred
Securities set forth opposite their respective names below. In the Underwriting
Agreement, the Underwriters have agreed, subject to the terms and conditions
set forth therein, to purchase all of the Preferred Securities offered hereby
if any of the Preferred Securities are purchased.
<TABLE>
<CAPTION>
Number of
Underwriter Preferred Securities
----------- --------------------
<S> <C>
----
Total..............................................
====
</TABLE>
In view of the fact that the proceeds of the sale of the Preferred Securities
will ultimately be used to purchase Series Junior Subordinated Notes, the
Underwriting Agreement provides that the Corporation will pay as compensation
to the Underwriters $ per Preferred Security for the accounts of the
several Underwriters ($ in the aggregate).
The Underwriters have advised the Corporation and the Trust that they propose
to offer the Preferred Securities in part directly to the public at the initial
public offering price, as set forth on the cover page of this Prospectus
Supplement, and in part to certain securities dealers at such price less a
concession not in excess of $ per Preferred Security. The Underwriters may
allow, and such dealers may reallow, a concession not in excess of $ per
Preferred Security to certain other dealers. After the Preferred Securities are
released for sale to the public, the offering price and other selling terms may
from time to time be varied by the Representatives.
The Preferred Securities are expected to be approved for listing on the New
York Stock Exchange, subject to official notice of issuance. Trading of the
Preferred Securities on the New York Stock Exchange is expected to commence
within a 30-day period after the initial delivery of the Preferred Securities.
The Representatives have advised the Corporation and the Trust that they intend
to make a market in the Preferred Securities prior to the commencement of
trading on the New York Stock Exchange. The Representatives will have no
obligation to make a market in the Preferred Securities, however, and may cease
market-making activities, if commenced, at any time.
Prior to this offering, there has been no public market for the Preferred
Securities. In order to meet one of the requirements for listing the Preferred
Securities on the New York Stock Exchange, the Underwriters will undertake to
sell lots of 100 or more Preferred Securities to a minimum of 400 beneficial
holders.
S-36
<PAGE>
In connection with the offering, the Underwriters may purchase and sell the
Preferred Securities in the open market. These transactions may include over-
allotment and stabilizing transactions and purchases to cover syndicate short
positions created in connection with the offering. Stabilizing transactions
consist of certain bids or purchases for the purpose of preventing or retarding
a decline in the market price of the Preferred Securities; and syndicate short
positions involve the sale by the Underwriters of a greater number of Preferred
Securities than they are required to purchase from the Trust in the offering.
The Underwriters also may impose a penalty bid, whereby selling concessions
allowed to syndicate members or other broker-dealers in respect of the
securities sold in the offering for their account may be reclaimed by the
syndicate if such Preferred Securities are repurchased by the syndicate in
stabilizing or covering transactions. These activities may stabilize, maintain
or otherwise affect the market price of the Preferred Securities, which may be
higher than the price that might otherwise prevail in the open market; and
these activities, if commenced, may be discontinued at any time. These
transactions may be effected on the New York Stock Exchange, in the over-the-
counter market or otherwise.
The Corporation and the Trust have agreed, during the period of days from
the date of the Underwriting Agreement, not to sell, offer to sell, grant any
option for the sale of, or otherwise dispose of any Preferred Securities, any
security convertible into or exchangeable for the Preferred Securities or the
Series Junior Subordinated Notes or any debt securities substantially similar
to the Series Junior Subordinated Notes or equity securities substantially
similar to the Preferred Securities (except for the Series Junior
Subordinated Notes and the Preferred Securities issued pursuant to the
Underwriting Agreement), without the prior written consent of the
Representatives.
The Corporation and the Trust have agreed to indemnify the Underwriters
against certain liabilities, including liabilities under the Securities Act of
1933.
The Corporation estimates that it will spend approximately $ for
printing, rating agency fees, trustees' fees, legal fees and other expenses of
the offering.
In the course of their respective businesses, the Underwriters and their
affiliates have engaged, and will in the future engage, in investment banking
transactions with the Corporation and certain of its affiliates.
VALIDITY OF THE SECURITIES
Richards, Layton & Finger, P.A., Wilmington, Delaware, special Delaware
counsel to the Corporation and the Trust, will pass upon certain matters of
Delaware law relating to the validity of the Preferred Securities on behalf of
the Corporation and the Trust. Dewey Ballantine LLP, New York, New York, will
pass upon the validity of the Series Junior Subordinated Notes, the Guarantee
and certain related matters as well as certain matters relating to United
States federal income tax considerations on behalf of the Corporation. Sullivan
& Cromwell, New York, New York, will pass upon the validity of the Series
Junior Subordinated Notes and the Guarantee for the Underwriters.
S-37
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the +
+Securities and Exchange Commission is effective. This prospectus is not an +
+offer to sell these securities and it is not soliciting an offer to buy these +
+securities in any state where the offer or sale is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
PROSPECTUS SUPPLEMENT
(To Prospectus dated , 1999)
Subject to Completion dated , 1999
$[ ]
Duke Capital Corporation
a subsidiary of Duke Energy Corporation
Series % Senior Notes due
----------
The Corporation will pay interest on the Series Senior Notes on and
of each year. The first interest payment will be made on , .
The Series Senior Notes will mature on , and are redeemable at the
option of the Corporation at any time at a redemption price determined by using
the formula set forth in this Prospectus Supplement. See "Description of the
Series Senior Notes--Redemption at the Option of the Corporation."
The Series Senior Notes are unsecured and rank equally with all other
unsecured senior indebtedness of the Corporation. The Corporation will issue
the Series Senior Notes only in registered form in denominations of $
and integral multiples of $ .
<TABLE>
<CAPTION>
Per Series
Senior Note Total
------------ -----
<S> <C> <C>
Initial Public Offering Price (1)............................
Underwriting Discounts and Commissions.......................
Proceeds, before expenses, to the Corporation................
</TABLE>
- -----
(1) Purchasers will also be required to pay accrued interest from , , if
settlement occurs after that date.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this Prospectus Supplement or the accompanying
Prospectus. Any representation to the contrary is a criminal offense.
The underwriters are severally underwriting the Series Senior Notes. The
underwriters expect to deliver the Series Senior Notes in book-entry only
form through the facilities of The Depository Trust Company against payment in
New York, New York on , .
----------
[Names of Underwriters]
----------
Prospectus Supplement dated , .
<PAGE>
You should rely only on the information contained or incorporated by
reference in this Prospectus Supplement and the accompanying Prospectus. We
have not, and the Underwriters have not, authorized any other person to provide
you with different information. If anyone provides you with different or
inconsistent information, you should not rely on it. We are not, and the
Underwriters are not, making an offer to sell these securities in any
jurisdiction where the offer or sale is not permitted. You should assume that
the information appearing in this Prospectus Supplement and the accompanying
Prospectus is accurate as of the date on the front of the documents only. Our
business, financial condition, results of operations and prospects may have
changed since that date.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PROSPECTUS SUPPLEMENT
PAGE
----
<S> <C>
Forward-Looking Statements................................................. S-3
Recent Developments........................................................ S-4
Description of the Series Senior Notes................................ S-5
Underwriting............................................................... S-10
Validity of the Securities................................................. S-11
PROSPECTUS
Where to Find More Information............................................. 2
Duke Capital Corporation................................................... 4
The Trusts................................................................. 9
Use of Proceeds............................................................ 10
Description of the Senior Notes............................................ 11
Description of the Junior Subordinated Notes............................... 23
Description of the Preferred Securities.................................... 33
Description of the Guarantees.............................................. 34
Accounting Treatment....................................................... 37
Plan of Distribution....................................................... 37
Validity of the Securities................................................. 38
Experts.................................................................... 38
</TABLE>
S-2
<PAGE>
FORWARD-LOOKING STATEMENTS
This Prospectus Supplement and the accompanying Prospectus include forward-
looking statements within the meaning of Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934. We caution
investors and prospective investors that there are a number of forward-looking
statements contained or incorporated by reference in this Prospectus Supplement
and the accompanying Prospectus. These forward-looking statements may include
statements about the expected revenues, earnings, capital expenditures,
resolution and impact of litigation, competitive performance, or other
prospects for the business of Duke Capital Corporation (the "Corporation") and
its subsidiaries or their affiliated companies, and include any and all
assumptions that underlie the forward-looking statements and other statements
that are other than statements of historical fact. Actual outcomes and results
are likely to differ, and may differ materially, from those projected. Factors
that could cause forward-looking statements to be inaccurate include, but are
not limited to:
. state and federal legislative and regulatory initiatives
that affect cost and investment recovery, have an impact
on rate structures, and affect the speed and degree to
which competition enters the electric and natural gas
industries;
. industrial, commercial and residential growth in the
service territories of the Corporation and its
subsidiaries;
. the weather and other natural phenomena;
. the timing and extent of changes in commodity prices and
interest rates;
. changes in environmental and other laws and regulations
to which the Corporation and its subsidiaries are
subject or other external factors over which the
Corporation has no control;
. the results of financing efforts;
. growth in opportunities for the Corporation's
subsidiaries;
. achievement of Year 2000 readiness; and
. the effect of the Corporation's accounting policies.
In light of these risks, uncertainties and assumptions, the forward-looking
events discussed in this Prospectus Supplement and the accompanying Prospectus
might not occur. We undertake no obligation to publicly update or revise any
forward-looking statements or this discussion of some of the factors that could
cause actual results to differ, whether as a result of new information, future
events or otherwise.
S-3
<PAGE>
RECENT DEVELOPMENTS
RECENT INCOME STATEMENT DATA
The following table presents unaudited income statement data for the year
ended December 31, 1998, which data should be read in conjunction with the
consolidated financial statements, the notes thereto and the other information
contained or incorporated by reference in this Prospectus Supplement and the
accompanying Prospectus.
<TABLE>
<CAPTION>
(DOLLARS
IN THOUSANDS)
-------------
<S> <C>
Operating Revenues.......................................... $13,059,000
Operating Expenses.......................................... 12,023,000
Operating Income........................................... 1,036,000
Other Income, Net........................................... 101,000
Earnings Before Interest and Taxes.......................... 1,137,000
Interest Expense............................................ 237,000
Income Before Extraordinary Loss............................ 519,000
Net Income.................................................. 511,000
</TABLE>
S-4
<PAGE>
DESCRIPTION OF THE SERIES SENIOR NOTES
A description of the specific terms of the Series Senior Notes is set forth
below. This description should be read together with the description of the
general terms and provisions of the Senior Notes in the accompanying Prospectus
under the caption "Description of the Senior Notes." The description does not
purport to be complete and is subject to, and is qualified in its entirety by
reference to, the description in the accompanying Prospectus and the Senior
Note Indenture. Capitalized terms used in the description that are not defined
in this Prospectus Supplement are defined in the Senior Note Indenture.
GENERAL
The Series Senior Notes will be limited to $ in aggregate principal
amount and will mature on , .
The Corporation will pay the principal of, premium, if any, and interest on
the Series Senior Notes in immediately available funds to The Depository
Trust Company ("DTC"), or its nominee, as the case may be, as the registered
owner and holder of the Series Senior Notes, as long as the Series Senior
Notes are represented by one or more global securities and DTC serves as
securities depositary.
The Series Senior Notes will have no sinking fund provisions.
INTEREST
The Series Senior Notes will bear interest at the rate of % per annum
from the date of issue, or from the most recent interest payment date to which
interest has been paid or provided for. The Corporation will pay interest
semiannually on and of each year, commencing on , , to the person
or persons in whose name the Series Senior Notes are registered on the close
of business on the fifteenth calendar day before the relevant interest payment
date, except that the Corporation will pay interest payable at the stated
maturity of the Series Senior Notes or on a redemption date to the person or
persons to whom principal is payable. Interest 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 is not a Business Day, the Corporation will pay such
interest on the next succeeding day which is a Business Day (and without any
interest or other payment due to any such delay) with the same force and effect
as if made on such date.
RANKING
The Series Senior Notes will be direct, unsecured and unsubordinated
obligations of the Corporation ranking equal in priority with all other
unsecured and unsubordinated indebtedness of the Corporation. The Senior Note
Indenture contains no restrictions on the amount of additional indebtedness
that the Corporation may incur thereunder.
The Corporation conducts its business through subsidiaries. Accordingly, the
ability of the Corporation to meet its obligations under the Series Senior
Notes will be dependent on the earnings and cash flows of its subsidiaries and
the ability of its subsidiaries to pay dividends or to advance or
S-5
<PAGE>
repay funds to the Corporation. In addition, the rights of the Corporation and
its creditors to participate in the assets of any subsidiary upon the
subsidiary's liquidation or recapitalization will be subject to the prior
claims of the subsidiary's creditors.
REDEMPTION AT THE OPTION OF THE CORPORATION
The Corporation may redeem the Series Senior Notes at its option, in whole
or in part at any time, at a redemption price equal to the greater of (i) 100%
of the principal amount of the Series Senior Notes to be redeemed and (ii)
the sum of the present values of the remaining scheduled payments of principal
and interest on such Series Senior Notes (exclusive of interest accrued to
the redemption date) discounted to the redemption date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Treasury
Rate plus basis points, plus, in either case, accrued and unpaid interest
on the principal amount being redeemed to such redemption date.
"Treasury Rate" means, with respect to any redemption date, (i) the yield,
under the heading which represents the average for the immediately preceding
week, appearing in the most recently published statistical release designated
"H.15(519)" or any successor publication which is published weekly by the Board
of Governors of the Federal Reserve System 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 Comparable Treasury Issue (if no maturity is within three
months before or after the Stated Maturity, yields for the two published
maturities most closely corresponding to the Comparable Treasury Issue shall be
determined, and the 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 semiannual equivalent yield to maturity of the Comparable
Treasury Issue, calculated using 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. The Treasury Rate will be calculated
on the third Business Day preceding the redemption date.
"Comparable Treasury Issue" means the United States Treasury security
selected by the Independent Investment Banker as having a maturity comparable
to the remaining term of the Series Senior Notes to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of such Series Senior Notes.
"Independent Investment Banker" means and any successor firm or, if such
firm is unwilling or unable to select the Comparable Treasury Issue, an
independent investment banking institution of national standing appointed by
the Senior Indenture Trustee after consultation with the Corporation.
"Comparable Treasury Price" means with respect to any redemption date for the
Series Senior Notes (i) the average of Reference Treasury Dealer
Quotations for such redemption date, after excluding the highest and lowest
such Reference Treasury Dealer Quotations, or (ii) if the Senior Indenture
Trustee obtains fewer than such Reference Treasury Dealer Quotations, the
average of all such quotations.
S-6
<PAGE>
"Reference Treasury Dealer" means each of , , , and
and their respective successors; provided, however, that if any of
the foregoing shall cease to be a primary U.S. Government securities dealer in
New York City (a "Primary Treasury Dealer"), the Corporation will substitute
therefor another Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any redemption date, the average, as determined by the
Senior 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 Senior Indenture Trustee by such Reference Treasury
Dealer at 5:00 p.m., New York City time, on the third Business Day preceding
such redemption date.
Redemption Procedures
Notice of any redemption by the Corporation will be mailed at least 30 days
but not more than 60 days before any redemption date to each registered holder
of Series Senior Notes to be redeemed. If the redemption notice is given and
funds deposited as required, then interest will cease to accrue on and after
the redemption date on the Series Senior Notes or portions of Series
Senior Notes called for redemption. In the event that any redemption date is
not a Business Day, the Corporation will pay the redemption price on the next
succeeding day which is a Business Day (without any interest or other payment
due to such delay).
Denominations
The Corporation may issue the Series Senior Notes in denominations of $
or integral multiples of $ .
Defeasance
The Senior Notes will be subject to Defeasance and Covenant Defeasance as
described in the Senior Note Indenture. See "Description of the Senior Notes--
Defeasance and Covenant Defeasance" in the accompanying Prospectus.
Under current United States federal income tax laws, Defeasance would be
treated as an exchange of the relevant Series Senior Notes in which holders
of such Series Senior Notes might recognize gain or loss. In addition, the
amount, timing and character of amounts that holders would be required
thereafter to include in income might be different from that which would be
includible in the absence of such Defeasance. Prospective investors are urged
to consult their own tax advisors as to the specific consequences of a
Defeasance, including the applicability and effect of tax laws other than
United States federal income tax laws. Under current United States federal
income tax laws, unless accompanied by other changes in the terms of the Series
Senior Notes, Covenant Defeasance should not be treated as a taxable
exchange.
Book-Entry Only Issuance--DTC
DTC will act as the initial securities depositary for the Series Senior
Notes. The Series Senior Notes will be issued as fully registered securities
registered in the name of Cede & Co.,
S-7
<PAGE>
DTC's nominee. One or more fully registered global Series Senior Note
certificates will be issued, representing in the aggregate the total principal
amount of the Series Senior Notes, and will be deposited with DTC.
DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Securities Exchange
Act of 1934. DTC holds securities that its participants ("Participants")
deposit with DTC. DTC also facilitates the settlement among Participants of
securities transactions, such as transfers and pledges, in deposited securities
through electronic computerized book-entry changes in Participants' accounts,
thereby eliminating the need for physical movement of securities certificates.
Direct Participants include securities brokers and dealers, banks, trust
companies, clearing corporations and certain other organizations ("Direct
Participants"). DTC is owned by a number of its Direct Participants and by the
New York Stock Exchange, the American Stock Exchange and the National
Association of Securities Dealers, Inc. Access to the DTC system is also
available to others such as securities brokers and dealers, banks and trust
companies that clear through or maintain a custodial relationship with a Direct
Participant, either directly or indirectly ("Indirect Participants"). The rules
applicable to DTC and its Participants are on file with the Securities and
Exchange Commission.
Purchases of Series Senior Notes within the DTC system must be made by or
through Direct Participants, which will receive a credit for the Series
Senior Notes on DTC's records. The ownership interest of each actual purchaser
of Series Senior Notes ("Beneficial Owner") is in turn to be recorded on the
Direct and Indirect Participants' records. Beneficial Owners will not receive
written confirmation from DTC of their purchases, but Beneficial Owners are
expected to receive written confirmations providing details of the
transactions, as well as periodic statements of their holdings, from the Direct
or Indirect Participants through which the Beneficial Owners entered into the
transaction. Transfers of ownership interests in the Series Senior Notes are
to be accomplished by entries made on the books of Participants acting on
behalf of Beneficial Owners. Beneficial Owners will not receive certificates
representing their ownership interests in Series Senior Notes, except in the
event that use of the book-entry system for the Series Senior Notes is
discontinued.
To facilitate subsequent transfers, all Series Senior Notes deposited by
Participants with DTC are registered in the name of DTC's partnership nominee,
Cede & Co. The deposit of Series Senior Notes with DTC and their registration
in the name of Cede & Co. effect no change in beneficial ownership. DTC has no
knowledge of the actual Beneficial Owners of the Series Senior Notes. DTC's
records reflect only the identity of the Direct Participants to whose accounts
such Series Senior Notes are credited, which may or may not be the Beneficial
Owners. The Participants will remain responsible for keeping account of their
holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct Participants,
by Direct Participants to Indirect Participants, and by Direct Participants and
Indirect Participants to Beneficial Owners will be governed by arrangements
among them, subject to any statutory or regulatory requirements as may be in
effect from time to time.
S-8
<PAGE>
Redemption notices will be sent to DTC. If less than all of the Series
Senior Notes are being redeemed, DTC will reduce the amount of interest of each
Direct Participant in the Series Senior Notes in accordance with its
procedures.
Neither DTC nor Cede & Co. will consent or vote with respect to Series
Senior Notes. Under its usual procedures, DTC would mail an Omnibus Proxy to
the Corporation as soon as possible after the record date. The Omnibus Proxy
assigns Cede & Co.'s consenting or voting rights to those Direct Participants
to whose accounts the Series Senior Notes are credited on the record date
(identified in a listing attached to the Omnibus Proxy).
Payments on the Series Senior Notes will be made to Cede & Co., as nominee
of DTC. DTC's practice is to credit Direct Participants' accounts, upon DTC's
receipt of funds and corresponding detailed information, on the relevant
payment date in accordance with their respective holdings shown on DTC's
records. Payments by Participants to Beneficial Owners will be governed by
standing instructions and customary practices, as is the case with securities
held for the account of customers in bearer form or registered in "street
name," and will be the responsibility of such Participant and not of DTC or the
Corporation, subject to any statutory or regulatory requirements as may be in
effect from time to time. Payment to Cede & Co. is the responsibility of the
Corporation or the Paying Agent, disbursement of such payments to Direct
Participants is the responsibility of Cede & Co. and disbursement of such
payments to the Beneficial Owners is the responsibility of Direct and Indirect
Participants.
Except as provided herein, a Beneficial Owner of an interest in a global
Series Senior Note will not be entitled to receive physical delivery of
Series Senior Notes. Accordingly, each Beneficial Owner must rely on the
procedures of DTC to exercise any rights under the Series Senior Notes. The
laws of some jurisdictions require that certain purchasers of securities take
physical delivery of securities in definitive form. Such laws may impair the
ability to transfer beneficial interests in a global Series Senior Note.
DTC may discontinue providing its services as securities depositary with
respect to the Series Senior Notes at any time by giving reasonable notice to
the Corporation. Under such circumstances, in the event that a successor
securities depositary is not obtained within 90 days, Series Senior Note
certificates will be printed and delivered to the holders of record.
Additionally, the Corporation may decide to discontinue use of the system of
book-entry transfers through DTC (or a successor securities depositary) with
respect to the Series Senior Notes. In that event, certificates for the
Series Senior Notes will be printed and delivered to the holders of record.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from sources that the Corporation believes to be reliable,
but the Corporation takes no responsibility for the accuracy of such
information. The Corporation has no responsibility for the performance by DTC
or its Participants of their respective obligations as described in this
Prospectus Supplement and the accompanying Prospectus or under the rules and
procedures governing their respective operations.
S-9
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in an Underwriting Agreement,
the Corporation has agreed to sell to each of the Underwriters named below, and
each of the Underwriters has severally agreed to purchase, the principal amount
of Series Senior Notes set forth opposite its name below. In the Underwriting
Agreement, the several Underwriters have agreed, subject to the terms and
conditions set forth therein, to purchase all of the Series Senior Notes
offered hereby if any of the Series Senior Notes are purchased. In the event
of default by an Underwriter, the Underwriting Agreement provides that, in
certain circumstances, the purchase commitments of the nondefaulting
Underwriters may be increased or the Underwriting Agreement may be terminated.
<TABLE>
<CAPTION>
Principal Amount
Underwriter of Series Senior Notes
----------- -------------------------
<S> <C>
$
-----
Total............................................ $
=====
</TABLE>
The Underwriters have advised the Corporation that they propose initially to
offer the Series Senior Notes to the public at the public offering price set
forth on the cover page of this Prospectus Supplement, and to certain dealers
at such price less a concession not in excess of % of the principal amount.
The Underwriters may allow, and such dealers may reallow, a discount not in
excess of % of the principal amount of the Series Senior Notes to certain
other dealers. After the initial public offering, the public offering price,
concession and discount may be changed.
In connection with the offering of the Series Senior Notes, the
Underwriters may engage in overallotment, stabilizing transactions and
syndicate covering transactions. Overallotment involves sales in excess of the
offering size, which creates a short position for the Underwriters. Stabilizing
transactions involve bids to purchase the Series Senior Notes in the open
market for the purpose of pegging, fixing or maintaining the price of the
Series Senior Notes. Syndicate covering transactions involve purchases of the
Series Senior Notes in the open market after the distribution has been
completed in order to cover short positions. Such stabilizing transactions and
syndicate covering transactions may cause the price of the Series Senior
Notes to be higher than it would otherwise be in the absence of such
transactions. Such activities, if commenced, may be discontinued at any time.
The Corporation has agreed, during the period of days from the date of the
Underwriting Agreement, not to sell, offer to sell, grant any option for the
sale of, or otherwise dispose of any Series Senior Notes, any security
convertible into or exchangeable for the Series Senior Notes or any debt
securities substantially similar to the Series Senior Notes (except for the
Series Senior Notes issued pursuant to the Underwriting Agreement), without
the prior written consent of the Underwriters.
The Corporation has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
S-10
<PAGE>
The Corporation estimates that it will spend approximately $ for
printing, rating agency fees, trustees' fees, legal fees and other expenses of
the offering.
In the course of their respective businesses, the Underwriters and their
affiliates have engaged, and will in the future engage, in investment banking
transactions with the Corporation and certain of its affiliates.
VALIDITY OF THE SECURITIES
Dewey Ballantine LLP, New York, New York, will pass upon the validity of the
Series Senior Notes and certain related matters on behalf of the Corporation.
Sullivan & Cromwell, New York, New York, will pass upon the validity of the
Series Senior Notes for the Underwriters.
S-11
<PAGE>
$[ ]
Duke Capital
Corporation
a subsidiary of Duke Energy Corporation
Series % Senior Notes
due
-------------------------------
PROSPECTUS SUPPLEMENT
-------------------------------
[Names of Underwriters]
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the +
+Securities and Exchange Commission is effective. This prospectus is not an +
+offer to sell these securities and it is not soliciting an offer to buy these +
+securities in any state where the offer or sale of these securities is not +
+permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Subject to Completion dated January 27, 1999
PROSPECTUS
$1,000,000,000
Duke Capital Corporation
a subsidiary of Duke Energy Corporation
Senior Notes
Junior Subordinated Notes
-----------
Duke Capital Financing Trust III
Duke Capital Financing Trust IV
Duke Capital Financing Trust V
Trust Preferred Securities
Fully and unconditionally guaranteed, as described herein, by
Duke Capital Corporation
a subsidiary of Duke Energy Corporation
-----------
This Prospectus contains summaries of the general terms of these securities.
We will provide the specific terms of these securities in supplements to this
Prospectus. You should read this Prospectus and the supplements carefully
before you invest.
If we decide to list any of these securities on a national securities
exchange upon issuance, the supplements to this Prospectus will identify the
exchange and state when we expect trading to begin. Our common stock is listed
on the New York Stock Exchange under the ticker symbol "DUK".
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this Prospectus. Any representation to the contrary is
a criminal offense.
We may offer these securities through underwriters, agents or dealers or
directly to institutional investors. The supplements will provide the specific
terms of the plan of distribution. "Plan of Distribution" below also provides
more information on this topic.
The date of this Prospectus is , 1999.
<PAGE>
WHERE TO FIND MORE INFORMATION
The Corporation and Duke Capital Financing Trust III, Duke Capital Financing
Trust IV and Duke Capital Financing Trust V (each, a "Trust") have filed a
registration statement on Form S-3 (the "Registration Statement") with the
Securities and Exchange Commission (the "Commission") under the Securities Act
of 1933. This Prospectus is part of the Registration Statement, but the
Registration Statement also contains additional information and exhibits. As
used in this Prospectus, the term "Registration Statement" includes any
amendments and exhibits thereto.
The Corporation has also filed a registration statement on Form 10 (the "Form
10") with the Commission for the registration of its common stock, without par
value, under the Securities Exchange Act of 1934. As a result, the Corporation
is subject to the informational requirements of such Act, and files annual,
quarterly and current reports, proxy statements and other information with the
Commission.
You may read and copy the Registration Statement, the Form 10 and the reports
and other information that the Corporation files with the Commission at the
Commission's public reference rooms at 450 Fifth Street, N.W., Washington, D.C.
20549. You may also read and copy materials at 500 West Madison Street, Suite
1400, Chicago, Ill. 60661 and at Seven World Trade Center, Suite 1300, New
York, N.Y. 10048. Copies of such materials can also be obtained at prescribed
rates from the public reference rooms of the Commission at its principal office
at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the Commission's
toll-free telephone number at 1-800-SEC-0330 if you need further information
about the operation of the Commission's public reference rooms. The
Corporation's filings with the Commission are also available from the
Commission's Web site at http://www.sec.gov.
The Commission allows the Corporation to "incorporate by reference" the
information in documents that it files with the Commission. This means that the
Corporation can disclose important information to you by referring you to those
documents. The information incorporated by reference is considered to be part
of this Prospectus and should be read with the same care. Later information
that the Corporation files with the Commission will automatically update and
supersede that information.
The following documents are incorporated in and made a part of this
Prospectus by reference:
. the Form 10;
. the Corporation's quarterly reports on Form 10-Q for the quarters ended
March 31, 1998, June 30, 1998 and September 30, 1998; and
. the Corporation's current reports on Form 8-K dated November 5, 1998,
December 1, 1998 and January 26, 1999.
Any future documents that the Corporation files with the Commission under
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 will
also be incorporated by reference into this Prospectus until the offering of
these securities has been completed.
You should rely only on the information contained or incorporated by
reference in this Prospectus. We have not authorized any other person to
provide you with different information. If
2
<PAGE>
anyone provides you with different or inconsistent information, you should not
rely on it. We are not making an offer to sell these securities in any
jurisdiction where the offer or sale is not permitted. You should assume that
the information appearing in this Prospectus is accurate as of the date hereof
only. Our business, financial condition, results of operations and prospects
may have changed since that date.
The Corporation will provide without charge to each person (including any
beneficial owner) to whom this Prospectus is delivered, upon written or oral
request, a copy of any documents incorporated by reference in this Prospectus
(other than the exhibits to such documents unless those exhibits are
specifically incorporated by reference). You should direct your request to the
Investor Relations Department, Duke Capital Corporation, P.O. Box 1005,
Charlotte, North Carolina 28201, telephone (704) 382-3853 or (800) 488-3853
(toll-free).
3
<PAGE>
DUKE CAPITAL CORPORATION
The Corporation is a wholly owned subsidiary of Duke Energy Corporation
("Duke Energy") which, under the name of Duke Power Company, completed a merger
with PanEnergy Corp ("PanEnergy") on June 18, 1997 and changed its name to its
present form. As a result, PanEnergy became a wholly owned subsidiary of Duke
Energy. Subsequent to the merger, Duke Energy contributed all of the common
stock of PanEnergy to the Corporation, which, under the name of Church Street
Capital Corp., served as the parent company of Duke Energy's non-utility
operations. The combination of the Corporation and PanEnergy was accounted for
similar to a pooling of interests and, accordingly, the consolidated financial
statements for periods prior to the combination were restated to include the
operations of PanEnergy. The Corporation provides financing and credit
enhancement services for its subsidiaries and conducts its operating activities
through its business segments as follows:
Energy Transmission
The Corporation is engaged in the interstate transportation and storage of
natural gas. Through its four major pipeline subsidiaries--Texas Eastern
Transmission Corporation, Algonquin Gas Transmission Company, Panhandle Eastern
Pipe Line Company and Trunkline Gas Company--the Corporation owns and operates
one of the nation's largest gas transmission networks, delivering approximately
12% of the natural gas consumed in the United States. This fully
interconnected, 22,000-mile system can receive natural gas from most major
North American producing regions for delivery to markets throughout the Mid-
Atlantic, New England and Midwest states as shown below.
[Logo depicting delivery markets throughout the Mid-Atlantic, New England and
Midwest states]
4
<PAGE>
The Corporation, through its wholly owned subsidiaries, PanEnergy and Texas
Eastern Corporation, entered into a stock purchase agreement with CMS Energy
Corporation ("CMS Energy") dated October 31, 1998, pursuant to which Panhandle
Eastern Pipe Line Company, Trunkline Gas Company and the storage properties
related to those systems (collectively, the "PEPL Companies"), along with
Trunkline LNG Company, would be sold to CMS Energy. The sales price of $2.2
billion involves a cash payment of $1.9 billion and existing debt of Panhandle
Eastern Pipe Line Company of approximately $300 million. While certain assets
and liabilities will be retained, such as the Houston office building, certain
environmental, legal and tax liabilities, and substantially all intercompany
balances, management is of the opinion that these assets and liabilities will
not have a material adverse effect on the consolidated results of operations or
financial position of the Corporation. The sale would result in an after-tax
gain of approximately $700 million and is contingent upon completion of due
diligence and receipt of clearances under the Hart-Scott-Rodino Act. The
closing of the transaction is expected to take place during the first quarter
of 1999.
Total assets of the PEPL Companies and Trunkline LNG Company were $1.3
billion at September 30, 1998. Combined operating results of the PEPL Companies
and Trunkline LNG Company, excluding intercompany transactions, were as
follows:
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
---------------------
1998 1997
---------- ----------
(Dollars in Millions)
<S> <C> <C>
Operating Revenues................................... $ 323.1 $ 354.7
Operating Expenses................................... 204.1 221.5
---------- ----------
Operating Income................................... 119.0 133.2
Other Income, Net.................................... 10.2 11.4
---------- ----------
EBIT............................................... $ 129.2 $ 144.6
</TABLE>
Energy Services
The Energy Services group offers a broad variety of worldwide services in
energy asset monetization, engineering, construction, liquids, gas and electric
marketing, risk management, natural gas liquids shipping, gas processing and
transport and "inside-the-fence" and merchant power generation. The Field
Services unit is engaged in the business of purchasing, gathering, transporting
and marketing natural gas, natural gas liquids and crude oil to industrial end-
users, local distribution companies, liquid petroleum gas wholesalers and
retailers and refiners. Through Duke Energy Trading and Marketing L.L.C., Duke
Energy Marketing, L.P., and Duke/Louis Dreyfus L.L.C., the Corporation markets
natural gas and electric power and provides risk management services to
utilities, municipalities and other large energy users.
Duke Engineering & Services, Inc., provides full-scope engineering, technical
and professional services to public and private sector clients worldwide in all
phases of nuclear, renewable and conventional power generation, from conceptual
design through construction and full life-cycle operation. Specialized
capabilities include engineering, design, project and construction management,
operations and maintenance, quality assurance, environmental management,
facility siting, petroleum services, power delivery services and safety and
health training. Duke/Fluor Daniel provides services related to the
engineering, procurement, construction and operation and maintenance of fossil-
fueled generating stations. The Global Asset Development group develops, owns,
manages and operates energy projects internationally, electric generation
facilities in the United States and Canada, and
5
<PAGE>
on-site, "inside-the-fence" electric generation and energy conversion
facilities for industrial customers. DukeSolutions is the Corporation's retail
energy services provider, offering customers a "one-stop shop" solution for
natural gas and electric commodities, energy efficiency and productivity
services and asset monetization.
The scope of the activities of Energy Services is shown below.
[TWO MAPS OF ENERGY SERVICES ACTIVITIES]
As part of its strategic plan to expand its nonregulated business, the
Corporation, through its wholly owned subsidiary, Duke Energy Field Services
Inc., agreed on November 20, 1998 to purchase the natural gas gathering,
processing, fractionation and natural gas liquids ("NGL") pipeline business of
UPFuels, a unit of Union Pacific Resources ("UPR"), as well as UPR's natural
gas and NGL marketing activities for $1.35 billion. The Corporation believes
that the assets being acquired, combined with its existing assets, would make
the Corporation the nation's largest producer of NGLs. The purchase also would
make the Corporation one of the largest gatherers of natural gas and one of the
largest marketers of natural gas and NGLs in the United States. Under the
purchase agreement, much of UPR's production in the United States would be
gathered and processed by the
6
<PAGE>
Corporation for a minimum of 10 years and UPR would dedicate for five years
most of its natural gas and NGL production to the Corporation for marketing.
The purchase is contingent on receiving clearances under the Hart-Scott-Rodino
Act. The transaction is expected to close at the end of the first quarter of
1999.
According to UPR, EBITD of the UPFuels assets was approximately $156 million
for the fiscal year ended December 31, 1997 and approximately $124 million for
the nine months ended September 30, 1998.
Other Operations
Crescent Resources, Inc. ("Crescent Resources") conducts real estate
management, forestry, and commercial and residential real estate development
operations. DukeNet Communications, Inc. ("DukeNet") develops and manages
communications systems, including fiber optic and wireless digital network
services.
The scope of the activities of Crescent Resources and DukeNet is shown below.
[MAP OF ACTIVITIES OF CRESCENT RESOURCES AND DUKENET]
The principal executive offices of the Corporation are located at 422 South
Church Street, Charlotte, North Carolina 28202, telephone (704) 594-6200.
7
<PAGE>
The following financial information is qualified in its entirety by the
financial statements included in the documents incorporated by reference in
this Prospectus. See "Where to Find More Information."
Selected Consolidated Financial Information
(Millions)
<TABLE>
<CAPTION>
Nine Months Ended
September 30, Year Ended December 31,
----------------- ---------------------------
1998 1997(1) 1997(1) 1996(1) 1995(1)
-------- -------- --------- -------- --------
<S> <C> <C> <C> <C> <C>
Income Statement Data
Operating Revenues.............. $9,868.5 $8,406.8 $11,914.8 $7,816.1 $5,187.7
Operating Expenses.............. 9,138.9 7,788.2 11,079.0 6,946.8 4,393.9
-------- -------- --------- -------- --------
Operating Income............... 729.6 618.6 835.8 869.3 793.8
Other Income, Net............... 71.8 37.3 36.7 20.1 18.0
-------- -------- --------- -------- --------
Earnings Before Interest and
Taxes.......................... 801.4 655.9 872.5 889.4 811.8
Interest Expense................ 180.3 158.2 214.2 232.1 239.5
Income Before Extraordinary
Item........................... 371.1 285.3 380.3 399.0 348.1
Net Income...................... 363.1 285.3 380.3 382.3 348.1
</TABLE>
- --------
(1) Data reflects accounting for the combination of the Corporation and
PanEnergy on June 30, 1997 similar to a pooling of interests. As a result,
the data gives effect to the combination as if it had occurred as of
January 1, 1995.
<TABLE>
<S> <C> <C> <C> <C> <C>
Balance Sheet Data
Property, Plant and Equipment,
Net ......................... $ 7,013.0 $ 5,962.5 $ 6,065.2 $5,800.7 $5,429.1
Total Assets.................. 13,082.9 10,907.2 11,096.8 9,751.7 8,225.8
Short-term Debt .............. 416.9 243.4 137.7 359.1 150.0
Long-term Debt, including
current portion.............. 3,052.6 2,538.0 2,941.3 2,203.3 2,401.9
</TABLE>
Financial Ratios
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30, Year Ended December 31,
------------------ ---------------------------------------
1998 1997(1) 1997(1) 1996(1) 1995(1) 1994(1) 1993(1)
------- ---------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to
Fixed Charges.......... 4.0 3.8 3.7 3.6 3.2 2.7 2.1
</TABLE>
For purposes of this ratio, (i) earnings consist of income from continuing
operations before income taxes and fixed charges and (ii) fixed charges consist
of all interest deductions and the interest component of rentals.
- --------
(1) Data reflects accounting for the combination of the Corporation and
PanEnergy on June 30, 1997 similar to a pooling of interests. As a result,
the data gives effect to the combination as if it had occurred as of
January 1, 1993.
8
<PAGE>
THE TRUSTS
Each Trust is a statutory business trust formed under Delaware law through
the filing of a certificate of trust with the Delaware Secretary of State. That
filing occurred on January 29, 1998 with respect to Duke Capital Financing
Trust III and on September 25, 1998 with respect to Duke Capital Financing
Trust IV and Duke Capital Financing Trust V.
Each Trust's business is defined in a trust agreement executed by the
Corporation, as depositor, and Chase Manhattan Bank Delaware. The trust
agreement of each Trust will be amended and restated in its entirety
substantially in the form filed as an exhibit to the Registration Statement of
which this Prospectus is a part (the "Trust Agreement"). Each Trust Agreement
will be qualified as an indenture under the Trust Indenture Act of 1939.
Each Trust exists for the exclusive purposes of (1) issuing its preferred
securities (the "Preferred Securities") and its common securities (the "Common
Securities") representing undivided beneficial interests in the assets of that
Trust and (2) investing the gross proceeds of the Preferred Securities and the
Common Securities in a related series of the Corporation's Junior Subordinated
Notes (the "Junior Subordinated Notes"). Each Trust may engage in only those
other activities as are necessary, appropriate, convenient or incidental to
these purposes. The Preferred Securities and the Common Securities together are
sometimes called the "Trust Securities" in this Prospectus.
Each Trust's business and affairs will be conducted by its trustees. The
Corporation, as the holder of the Common Securities, will appoint the trustees
of each Trust. The trustee of each Trust will consist of: two officers of the
Corporation as Administrative Trustees, The Chase Manhattan Bank as Property
Trustee and Chase Manhattan Bank Delaware as Delaware Trustee. The Property
Trustee of each Trust will act as the indenture trustee with respect to that
Trust for purposes of compliance with the provisions of the Trust Indenture Act
of 1939.
Reference is made to the Prospectus Supplement relating to the Preferred
Securities of a given Trust for further information concerning that Trust.
No separate financial statements of any Trust are included in this
Prospectus. The Corporation considers that such statements would not be
material to holders of the Preferred Securities because each Trust has no
independent operations and its sole purpose is investing the proceeds of the
sale of its Trust Securities in Junior Subordinated Notes. The Corporation does
not expect that any of the Trusts will be filing reports under the Securities
Exchange Act of 1934 with the Commission.
The principal place of business of each Trust will be c/o Duke Capital
Corporation, 422 South Church Street, Charlotte, North Carolina 28202,
telephone (704) 594-6200.
9
<PAGE>
USE OF PROCEEDS
Each Trust will invest the proceeds that it receives from the sale of the
Preferred Securities in Junior Subordinated Notes. Unless the applicable
Prospectus Supplement states otherwise, the Corporation will use the net
proceeds that it receives from such investment and any proceeds that it
receives from the sale of its senior notes (the "Senior Notes") or other sales
of the Junior Subordinated Notes for general corporate purposes, including
capital expenditures, working capital, debt repayments and advances to
affiliates.
10
<PAGE>
DESCRIPTION OF THE SENIOR NOTES
A description of the terms of the Senior Notes is set forth below. This
description does not purport to be complete and is subject to, and is qualified
in its entirety by reference to, the Senior Indenture, dated as of April 1,
1998, between the Corporation and The Chase Manhattan Bank, as trustee (the
"Senior Indenture Trustee"), as supplemented from time to time (the "Senior
Note Indenture").
The Corporation may issue series of Senior Notes from time to time by
entering into supplemental indentures with the Senior Indenture Trustee. The
Corporation may also issue series of Senior Notes from time to time pursuant to
resolutions of the Corporation's Board of Directors or of a duly authorized
committee thereof.
The Senior Note Indenture, dated as of April 1, 1998, and the form of
supplemental indenture to the Senior Note Indenture are exhibits to the
Registration Statement of which this Prospectus is a part. The terms of each
series of Senior Notes will include those stated in the Senior Note Indenture
for that series and those made a part of the Senior Note Indenture by reference
to the Trust Indenture Act of 1939.
General
The Corporation will issue Senior Notes under the Senior Note Indenture as
one or more series of unsecured senior debt securities. The Senior Notes will
rank equal in priority with all other unsecured and unsubordinated debt of the
Corporation.
The Senior Note Indenture does not limit the aggregate principal amount of
Senior Notes that the Corporation may issue. The Senior Notes of a series need
not be issued at the same time, bear interest at the same rate or mature on the
same date.
The Corporation conducts its business through subsidiaries. Accordingly, the
ability of the Corporation to meet its obligations under the Senior Notes will
be dependent on the earnings and cash flows of its subsidiaries and the ability
of its subsidiaries to pay dividends or to advance or repay funds to the
Corporation. In addition, the rights of the Corporation and its creditors to
participate in the assets of any subsidiary upon the subsidiary's liquidation
or recapitalization will be subject to the prior claims of the subsidiary's
creditors.
Reference is made to the Prospectus Supplement for a particular series of
Senior Notes for the following terms of that series:
. the title of the series;
. any limit on the aggregate principal amount of the Senior Notes of the
series;
. the date or dates on which the principal of any of such Senior Notes will
be payable or the method for determining such date or dates, and the
right, if any, of the Corporation to shorten or extend the date on which
the principal of any Senior Notes of the series is payable;
. the rate or rates at which any of such Senior Notes will bear interest,
if any, or the method for determining such rate or rates, and the date or
dates from which any such interest will accrue;
11
<PAGE>
. the interest payment dates on which any such interest will be payable and
the regular record date, if any, for any such interest payable on any
interest payment date;
. if applicable, whether the Corporation may extend the interest payment
periods and, if so, the terms of any such extension;
. the place or places where principal and any premium and interest on any
of such Senior Notes will be payable, if other than the principal
corporate trust office of the Senior Indenture Trustee;
. the obligation, if any, of the Corporation to redeem or purchase any of
such Senior Notes pursuant to any sinking fund, purchase fund or
analogous provision or at the option of the holder and the terms and
conditions on which any of such Senior Notes may be redeemed or purchased
pursuant to such obligation;
. the terms and conditions, if any, on which the Corporation may at its
option redeem any of such Senior Notes;
. if applicable, the fact that certain terms of the Senior Note Indenture
described below under "Defeasance and Covenant Defeasance" will not apply
to any of such Senior Notes;
. the currency, currencies or currency units in which principal and any
premium and interest on any of such Senior Notes will be payable, if
other than U.S. dollars, and the manner of determining the equivalent of
those amounts in U.S. dollars for any purpose;
. if the principal or any premium or interest on any of such Senior Notes
is payable, at the election of the Corporation or the holder, in one or
more currencies or currency units other than those in which such Senior
Notes are stated to be payable, then the currency, currencies or currency
units in which those payments will be made, the terms and conditions upon
which the election is to be made and the amount so payable (or the manner
of determining that amount);
. the portion of the principal amount of any of such Senior Notes which
will be payable upon declaration of acceleration of maturity, if other
than the entire principal amount;
. whether any such Senior Notes will be issuable as global securities
("Global Securities") and, if so, the depositary and any provisions for
the transfer or exchange of any such Global Securities, if different from
those described below under "--Global Securities";
. any addition to, deletion from or change in Events of Default or
covenants with respect to any of such Senior Notes;
. any index or formula for determining the amount of principal or any
premium or interest on any of such Senior Notes and the manner of
determining any such amounts;
. if the principal amount payable on the maturity date of any of such
Senior Notes will not be determinable on any one or more dates prior to
the maturity date, the amount which will be deemed to be such principal
amount as of any such date for any purpose, including the principal
amount which will be due and payable upon any maturity other than the
maturity date (or the manner of determining any such amount); and
. any other terms of the Senior Notes.
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Unless the applicable Prospectus Supplement states otherwise, the Corporation
will issue the Senior Notes only in fully registered form, without coupons, and
there will be no service charge for any registration of transfer or exchange of
the Senior Notes. The Corporation may, however, require payment to cover any
tax or other governmental charge payable in connection with such registration
of transfer or exchange.
The Corporation may offer and sell Senior Notes, including Original Issue
Discount Senior Notes, at a substantial discount below their principal amount.
The applicable Prospectus Supplement will describe the special United States
federal income tax and other considerations, if any, applicable thereto. In
addition, the applicable Prospectus Supplement may describe certain special
United States federal income tax or other considerations, if any, applicable to
any Senior Notes which are denominated in a currency or currency unit other
than U.S. dollars.
The Senior Note Indenture does not contain provisions that afford any holders
of Senior Notes protection in the event of a highly leveraged transaction
involving the Corporation.
Global Securities
Some or all of the Senior Notes of a series may be represented in whole or in
part by one or more Global Securities deposited with or on behalf of one or
more depositaries.
The applicable Prospectus Supplement will describe the terms of any
depositary arrangement. The Corporation anticipates that the following
provisions will apply to all depositary arrangements for Senior Notes
represented by Global Securities.
Unless the applicable Prospectus Supplement states otherwise, Senior Notes
which are to be represented by a Global Security deposited with or on behalf of
a depositary will be represented by a Global Security registered in the name of
that depositary or its nominee. Upon the issuance of a Global Security in
registered form, the depositary for such Global Security will credit, on its
book-entry registration and transfer system, the respective principal amounts
of the Senior Notes represented by such Global Security to the accounts of
institutions that have accounts with such depositary or its nominee
("participants"). The accounts to be credited will be designated by the
underwriters or agents of such Senior Notes or by the Corporation, if such
Senior Notes are offered and sold directly by the Corporation. Ownership of
beneficial interests in such Global Securities will be limited to participants
or persons that may hold interests through participants. Ownership of
beneficial interests by participants in such Global Securities will be shown
on, and the transfer of any such ownership interest will be effected only
through, records maintained by the depositary or its nominee for such Global
Security. Ownership of beneficial interests in Global Securities by persons
that hold through participants will be effected only through records maintained
by such participants. The laws of some jurisdictions require that certain
purchasers of securities take physical delivery of such securities in
definitive form. Such limits and such laws may impair the ability to transfer
beneficial interests in a Global Security.
So long as the depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such depositary or such nominee, as
the case may be, will be considered the sole owner or holder of the Senior
Notes represented by such Global Security for all purposes under the Senior
Note Indenture. Except as set forth below, owners of beneficial interests in
the Global Security will not be entitled to have the Senior Notes represented
by such Global Security registered
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in their names, will not receive or be entitled to receive physical delivery of
the Senior Notes in definitive form and will not be considered the owners or
holders thereof under the Senior Note Indenture.
Payment of principal of and any premium and interest on Senior Notes
registered in the name of or held by a depositary or its nominee will be made
in immediately available funds to the depositary or its nominee, as the case
may be, as the registered owner or the holder of the Global Security
representing such Senior Notes. None of the Corporation, the Senior Indenture
Trustee, any Paying Agent or the registrar and transfer agent for such Senior
Notes will have any responsibility or liability for any aspect of the records
relating to, or payments made on account of, beneficial ownership interests in
a Global Security for such Senior Notes or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
The Corporation expects that a depositary for Senior Notes of a series, upon
receipt of any payment of principal or any premium or interest in respect of a
Global Security, will credit immediately participants' accounts with payment in
amounts proportionate to their respective beneficial interests in the principal
amount of such Global Security as shown on the records of such depositary. The
Corporation also expects that payments by participants to owners of beneficial
interests in such Global Security held through such participants will be
governed by standing instructions and customary practices, as is now the case
with securities held for the accounts of customers registered in "street name,"
and will be the responsibility of such participants.
A Global Security may not be transferred in whole or in part except by the
depositary for such Global Security to a nominee of such depositary or by a
nominee of such depositary to such depositary or another nominee of such
depositary or by such depositary or any such nominee to a successor depositary
or a nominee of such successor depositary. If a depositary for Senior Notes of
a series is at any time unwilling or unable to continue as depositary and a
successor depositary is not appointed by the Corporation within 90 days or if
at any time the depositary ceases to be a clearing agency registered under the
Securities Exchange Act of 1934 when the depositary is required to be
registered to act as such depositary and no successor is appointed by the
Corporation within 90 days, then the Corporation will issue Senior Notes in
definitive registered form in exchange for the Global Security or Global
Securities representing such Senior Notes. In addition, the Corporation may at
any time determine not to have any Senior Notes represented by one or more
Global Securities and, in such event, will issue Senior Notes in definitive
registered form in exchange for the Global Securities representing such Senior
Notes. In any such instance, an owner of a beneficial interest in a Global
Security will be entitled to physical delivery in definitive form of the Senior
Notes represented by such Global Security equal in principal amount to such
beneficial interest and to have such Senior Notes registered in its name.
Events of Default
The following will be Events of Default under the Senior Note Indenture with
respect to Senior Notes of any series (unless not applicable to the particular
series or unless modified or deleted in a supplemental indenture as stated in
the applicable Prospectus Supplement):
.failure to pay principal of or any premium on any Senior Note of that
series when due;
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. failure to pay any interest on any Senior Note of that series when due,
continued for 60 days; provided, however, that the date on which such
payment is due and payable will be the date on which the Corporation is
required to make payment following any deferral of interest payments by
the Corporation under the terms of such Senior Notes;
. failure to make any sinking fund payment when and as due by the terms of
any Senior Note of that series, continued for 60 days;
. failure to perform any covenant of the Corporation in the Senior Note
Indenture (other than a covenant that is solely for the benefit of other
series), continued for 90 days after the Senior Indenture Trustee or the
holders of at least 33% in principal amount of the outstanding Senior
Notes of that series give written notice of the default (unless the
Senior Indenture Trustee or the Senior Indenture Trustee and the holders
of a principal amount of Senior Notes of that series not less than the
principal amount of Senior Notes the holders of which had given notice
of default extend that time period) (the Senior Indenture Trustee, or
the Senior Indenture Trustee and such holders, as the case may be, will
be deemed to have agreed to such an extension if the Corporation has
initiated and is diligently pursuing corrective action);
. certain events in bankruptcy, insolvency or reorganization of the
Corporation; and
. any other Event of Default with respect to Senior Notes of that series.
If an Event of Default with respect to Senior Notes of a series occurs and is
continuing, then the Senior Indenture Trustee or the holders of not less than
33% in principal amount of the outstanding Senior Notes of that series may, by
notice to the Corporation (and to the Senior Indenture Trustee if given by
holders), declare to be immediately due and payable the principal amount of all
Senior Notes of that series (or, if any Senior Notes of that series are
Original Issue Discount Senior Notes, the portion of the principal amount
specified in the terms of the series). However, that Event of Default will be
deemed waived at any time after the declaration of acceleration but before a
judgment or decree for payment of the money due has been obtained if:
. the Corporation has paid or deposited with the Senior Indenture Trustee
all overdue interest, the principal and any premium due otherwise than
by such declaration of acceleration and interest thereon, and any
interest on overdue interest (to the extent permitted by applicable
law), in each case with respect to the Senior Notes of such series, and
all amounts due to the Senior Indenture Trustee under the Senior Note
Indenture; and
. all Events of Default with respect to that series (other than the
nonpayment of the principal which became due solely by such declaration
of acceleration) have been cured or waived.
The Prospectus Supplement relating to a series of Original Issue Discount
Senior Notes will include the particular provisions relating to acceleration of
a portion of the principal amount of those Senior Notes upon the occurrence and
continuance of an Event of Default.
Subject to the provisions of the Senior Note Indenture relating to the duties
of the Senior Indenture Trustee in case of a continuing Event of Default, the
Senior Indenture Trustee will be under no obligation to exercise any of its
rights or powers under the Senior Note Indenture at the request or direction of
any of the holders unless those holders have offered reasonable indemnity
against the costs, expenses and liabilities which the Senior Indenture Trustee
might incur as a result.
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Subject to such provisions for indemnification and to certain other rights of
the Senior Indenture Trustee, the holders of a majority in principal amount of
the outstanding Senior Notes of any series have the right to direct the time,
method and place of conducting any proceedings for any remedy available to the
Senior Indenture Trustee or exercising any trust or power conferred on the
Senior Indenture Trustee with respect to the Senior Notes of that series. The
Senior Indenture Trustee may withhold notice to the holders of Senior Notes of
any series of any default (except in the payment of principal or interest) with
respect to that series if the Senior Indenture Trustee in good faith considers
it in the interest of holders to do so.
No holder of a Senior Note of any series will have any right to institute a
proceeding with respect to the Senior Note Indenture or for any remedy under
the Senior Note Indenture unless:
. that holder has previously given the Senior Indenture Trustee written
notice of a continuing Event of Default with respect to the Senior Notes
of that series;
. the holders of a majority in principal amount of the outstanding Senior
Notes of that series have made written request to institute the
proceeding;
. such holder or holders have offered reasonable indemnity to the Senior
Indenture Trustee;
. the Senior Indenture Trustee has failed to institute the proceeding for
60 days after receipt of the notice and offer of indemnity; and
. the Senior Indenture Trustee has not received from the holders of a
majority in principal amount of the outstanding Senior Notes of that
series a direction inconsistent with the written request.
Notwithstanding the foregoing, the holder of any Senior Note will have an
absolute and unconditional right to receive payment of the principal of and any
premium and, subject to certain limitations, interest on that Senior Note on
its maturity date (or, in the case of redemption, the date of redemption) and
to institute suit for the enforcement of any such payment.
The Corporation is required to furnish annually to the Senior Indenture
Trustee an officers' certificate to the effect that, to the best knowledge of
the officers providing the certificate, the Corporation is not in default under
the Senior Note Indenture or, if there has been a default, specifying the
default and its status.
Registration and Transfer
If Senior Notes of a series (or series and tenor) are to be redeemed, the
Corporation will not be required to:
. issue, register the transfer of, or exchange any Senior Notes of that
series (or series and tenor) during the 15 days immediately preceding
the date notice is mailed identifying the Senior Notes that are called
for redemption; or
. register the transfer of or exchange any Senior Note selected for
redemption, in whole or in part, except the unredeemed portion of a
Senior Note being redeemed in part.
Denominations
Senior Notes will be issuable in denominations of $1,000 and any integral
multiples of $1,000, unless the applicable Prospectus Supplement states
otherwise.
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Payment and Paying Agent
Principal of Senior Notes will be paid only against surrender of the Senior
Notes to the paying agent. Unless the applicable Prospectus Supplement states
otherwise, interest on Senior Notes will be payable, subject to surrender if
applicable, at the office of the paying agent or, at the option of the
Corporation, (1) by wire transfer to an account at a banking institution in the
United States that the person entitled to the interest designates in writing to
the Senior Indenture Trustee at least 16 days prior to the date of payment or
(2) by check mailed to the address of the person entitled to the interest as
such address appears in the security register for such Senior Notes.
Unless the applicable Prospectus Supplement states otherwise, the Senior
Indenture Trustee will act as paying agent for the Senior Notes, and the
principal corporate trust office of the Senior Indenture Trustee will serve as
the office through which the paying agent acts. The Corporation may, however,
designate additional paying agents, rescind the designation of any paying
agents or approve a change in the office through which any paying agent acts.
All moneys that the Corporation has paid to a paying agent for payment of
principal of or interest on Senior Notes which remain unclaimed at the end of
two years after such principal or interest has become due and payable will be
repaid to the Corporation at the Corporation's request. Holders will thereafter
look only to the Corporation for such payments.
Modification; Waiver
The Corporation and the Senior Indenture Trustee may, with certain
exceptions, amend or modify the Senior Note Indenture with the consent of the
holders of a majority in aggregate principal amount of the outstanding Senior
Notes of all series of Senior Notes affected by the amendment or modification
(voting as one class). No amendment or modification may, however, without the
consent of the holder of each outstanding Senior Note affected thereby:
. change the stated maturity of the principal of, or any installment of
principal of or interest on, any Senior Note;
. reduce the principal amount of, the rate of interest on, or any premium
payable upon the redemption of any Senior Note;
. reduce the amount of principal of any Senior Note due and payable upon
acceleration of the maturity thereof;
. change the currency of payment of principal of, or any premium or
interest on, any Senior Note;
. impair the right to institute suit for the enforcement of any such
payment on any Senior Note on or after the stated maturity (or date of
redemption);
. reduce the percentage in principal amount of Senior Notes of any series,
the consent of whose holders is required to amend or modify the Senior
Note Indenture, to waive compliance with certain provisions of the
Senior Note Indenture or to waive certain defaults; or
. with certain exceptions, modify the foregoing provisions or the sections
of the Senior Note Indenture governing waiver of certain covenants and
past defaults.
In addition, the Corporation and the Senior Indenture Trustee may execute
supplemental indentures to create new series of Senior Notes and for certain
other purposes, without the consent of any holders of Senior Notes.
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The holders of a majority in aggregate principal amount of the outstanding
Senior Notes of any series may waive, for that series, the Corporation's
compliance with certain restrictive provisions of the Senior Note Indenture.
The holders of a majority in aggregate principal amount of the outstanding
Senior Notes of all series under the Senior Note Indenture with respect to
which a default has occurred and is continuing (voting as one class) may waive
that default for all such series, except a default in the payment of principal
of, or any premium or interest on, any Senior Note of such series or a default
with respect to a covenant or provision which cannot be amended or modified
without the consent of the holder of each outstanding Senior Note affected.
Consolidation, Merger, Conveyance or Transfer
The Senior Note Indenture provides that the Corporation may consolidate or
merge with or into another corporation or other entity of a sort specified in
the Senior Note Indenture, or convey or transfer its properties and assets as
an entirety or substantially as an entirety to any such entity; provided,
however, that the successor, if any, assumes by supplemental indenture the
Corporation's obligations under the Senior Note Indenture and the Senior Notes
issued thereunder and the Corporation delivers an officers' certificate and an
opinion of counsel to the Senior Indenture Trustee stating that all conditions
precedent in the Senior Note Indenture relating to the consolidation, merger,
conveyance or transfer have been complied with. Upon the assumption by the
successor of the Corporation's obligations under the Senior Note Indenture and
the Senior Notes issued thereunder and the satisfaction of any other conditions
precedent provided for in the Senior Note Indenture, the successor will succeed
to and be substituted for the Corporation under the Senior Note Indenture, and
the Corporation will be relieved of its obligations under the Senior Note
Indenture and the Senior Notes.
Negative Pledge
The Senior Note Indenture provides that the Corporation will not, and will
not permit any Principal Subsidiary of the Corporation to, while any of the
Senior Notes remain outstanding, create, or suffer to be created or to exist,
any mortgage, lien, pledge, security interest or other encumbrance of any kind
upon any Principal Property of the Corporation or any Principal Subsidiary of
the Corporation or upon any shares of stock of any Principal Subsidiary of the
Corporation, whether such Principal Property is, or shares of stock are, now
owned or hereafter acquired, to secure any indebtedness for borrowed money of
the Corporation, unless it makes effective provision whereby the Senior Notes
then outstanding will be secured by such mortgage, lien, pledge, security
interest or other encumbrance equally and ratably with any and all indebtedness
for borrowed money thereby secured so long as any such indebtedness shall be so
secured; provided, however, that neither the Corporation nor any Principal
Subsidiary of the Corporation will be precluded from creating, or from
suffering to be created or to exist, any mortgages, liens, pledges, security
interests or other encumbrances, or any agreements, with respect to (1)
purchase money mortgages, or other purchase money liens, pledges, security
interests or other encumbrances of any kind upon property acquired after the
date of the Senior Note Indenture by the Corporation or any Principal
Subsidiary of the Corporation, or mortgages, liens, pledges, security interests
or other encumbrances of any kind existing on any property or any shares of
stock at the time of the acquisition thereof (including mortgages, liens,
pledges, security interests or other encumbrances which exist on any property
or
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any shares of stock of a Person which is consolidated with or merged with or
into the Corporation or any Principal Subsidiary of the Corporation or which
transfers or leases all or substantially all of its properties to the
Corporation or any Principal Subsidiary of the Corporation), or conditional
sales agreements or other title retention agreements and leases in the nature
of title retention agreements with respect to any property acquired after the
date of the Senior Note Indenture; provided, however, that no such mortgage,
lien, pledge, security interest or other encumbrance will extend to or cover
any other property of the Corporation or such Principal Subsidiary of the
Corporation; (2) mortgages, liens, pledges, security interests or other
encumbrances of any kind upon any property of the Corporation or any Principal
Subsidiary of the Corporation or any shares of stock of any Principal
Subsidiary of the Corporation existing as of the date of the initial issuance
of the Senior Notes or upon the property or any shares of stock of any
corporation, which mortgages, liens, pledges, security interests or other
encumbrances existed at the time such corporation became a Principal Subsidiary
of the Corporation; liens for taxes or assessments or other governmental
charges or levies; pledges or deposits to secure obligations under workers'
compensation laws, unemployment insurance and other social security
legislation, including liens of judgments thereunder which are not currently
dischargeable; pledges or deposits to secure performance in connection with
bids, tenders, contracts (other than contracts for the payment of money) or
leases to which the Corporation or any Principal Subsidiary of the Corporation
is a party; pledges or deposits to secure public or statutory obligations of
the Corporation or any Principal Subsidiary of the Corporation; builders',
materialmen's, mechanics', carriers', warehousemen's, workers', repairmen's,
operators', landlords' or other like liens in the ordinary course of business,
or deposits to obtain the release of such liens; pledges or deposits to secure,
or in lieu of, surety, stay, appeal, indemnity, customs, performance or return-
of-money bonds; other pledges or deposits for similar purposes in the ordinary
course of business; liens created by or resulting from any litigation or
proceeding which at the time is being contested in good faith by appropriate
proceedings; liens incurred in connection with the issuance of bankers'
acceptances and lines of credit, bankers' liens or rights of offset and any
security given in the ordinary course of business to banks or others to secure
any indebtedness payable on demand or maturing within 12 months of the date
that such indebtedness is originally incurred; liens incurred in connection
with repurchase, swap or other similar agreements (including, without
limitation, commodity price, currency exchange and interest rate protection
agreements); leases made, or existing on property acquired, in the ordinary
course of business; liens securing industrial revenue or pollution control
bonds; liens, pledges, security interests or other encumbrances on any property
arising in connection with any defeasance, covenant defeasance or in-substance
defeasance of indebtedness of the Corporation or any Principal Subsidiary of
the Corporation, including the Senior Notes; liens created in connection with,
and created to secure, a non-recourse obligation; zoning restrictions,
easements, licenses, rights-of-way, restrictions on the use of property or
minor irregularities in title thereto, which do not, in the opinion of the
Corporation, materially impair the use of such property in the operation of the
business of the Corporation or the value of such property for the purpose of
such business; (3) mortgages, liens, pledges, security interests or other
encumbrances in favor of the United States of America, any state, any foreign
country or any department, agency or instrumentality or political subdivision
of any such jurisdiction, to secure partial, progress, advance or other
payments pursuant to any contract or statute or to secure any indebtedness
incurred for the purpose of financing all or any part of the purchase price or
the cost of constructing or improving the property subject to such mortgages,
including, without limitation,
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mortgages to secure indebtedness of the pollution control or industrial revenue
bond type; (4) indebtedness which may be issued by the Corporation or any
Principal Subsidiary of the Corporation in connection with a consolidation or
merger of the Corporation or any Principal Subsidiary of the Corporation with
or into any other Person (which may be an affiliate of the Corporation or any
Principal Subsidiary of the Corporation) in exchange for or otherwise in
substitution for secured indebtedness of such Person ("Third Party Debt") which
by its terms (a) is secured by a mortgage on all or a portion of the property
of such Person, (b) prohibits secured indebtedness from being incurred by such
Person, unless the Third Party Debt shall be secured equally and ratably with
such secured indebtedness or (c) prohibits secured indebtedness from being
incurred by such Person; (5) indebtedness of any Person which is required to be
assumed by the Corporation or any Principal Subsidiary of the Corporation in
connection with a consolidation or merger of such Person, with respect to which
any property of the Corporation or any Principal Subsidiary of the Corporation
is subjected to a mortgage, lien, pledge, security interest or other
encumbrance; (6) mortgages, liens, security interests or other encumbrances on
property held or used by the Corporation or any Principal Subsidiary of the
Corporation in connection with the exploration for, or development, gathering,
production, storage or marketing of, natural gas, oil or other minerals
(including liquefied gas and synthetic gas); (7) mortgages, liens, pledges,
security interests or other encumbrances of any kind upon any property
acquired, constructed, developed or improved by the Corporation or any
Principal Subsidiary of the Corporation (whether alone or in association with
others) after the date of the Senior Note Indenture which are created prior to,
at the time of, or within 18 months after such acquisition (or in the case of
property constructed, developed or improved, after the completion of such
construction, development or improvement and commencement of full commercial
operation of such property, whichever is later) to secure or provide for the
payment of any part of the purchase price or cost thereof; provided that in the
case of such construction, development or improvement the mortgages, liens,
pledges, security interests or other encumbrances shall not apply to any
property theretofore owned by the Corporation or any Principal Subsidiary of
the Corporation other than theretofore unimproved real property; (8) mortgages,
liens, pledges, security interests and other encumbrances in favor of the
Corporation, one or more Principal Subsidiaries of the Corporation, one or more
wholly owned Subsidiaries of the Corporation or any of the foregoing in
combination; (9) the replacement, extension or renewal (or successive
replacements, extensions or renewals), as a whole or in part, of any mortgage,
lien, pledge, security interest or other encumbrance, or of any agreement,
referred to above in clauses (1) through (8) inclusive, or the replacement,
extension or renewal (not exceeding the principal amount of indebtedness
secured thereby together with any premium, interest, fee or expense payable in
connection with any such replacement, extension or renewal) of the indebtedness
secured thereby; provided that such replacement, extension or renewal is
limited to all or a part of the same property that secured the mortgage, lien,
pledge, security interest or other encumbrance replaced, extended or renewed
(plus improvements thereon or additions or accessions thereto); or (10) any
other mortgage, lien, pledge, security interest or other encumbrance not
excepted by the foregoing clauses (1) through (9); provided that immediately
after the creation or assumption of such mortgage, lien, pledge, security
interest or other encumbrance, the aggregate principal amount of indebtedness
for borrowed money of the Corporation secured by all mortgages, liens, pledges,
security interests and other encumbrances created or assumed under the
provisions of clause (10) will not exceed an amount equal to 10% of common
stockholder's equity of the Corporation, as shown on its consolidated balance
sheet for the accounting period occurring
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immediately prior to the creation or assumption of such mortgage, lien, pledge,
security interest or other encumbrance.
For the purposes of the preceding paragraph, the following terms have these
meanings: "Principal Property" means any natural gas pipeline, natural gas
gathering system, natural gas storage facility, natural gas processing plant or
other plant or facility located in the United States that in the opinion of the
Board of Directors or management of the Corporation is of material importance
to the business conducted by the Corporation and its consolidated subsidiaries
taken as a whole; "Principal Subsidiary" means any Subsidiary which owns a
Principal Property; and "Subsidiary" means, as to any Person, a corporation of
which more than 50% of the outstanding shares of stock having ordinary voting
power (other than stock having such power only by reason of contingency) is at
the time owned, directly or indirectly through one or more intermediaries, or
both, by such Person.
Defeasance and Covenant Defeasance
The Senior Note Indenture provides, unless the terms of the particular series
of Senior Notes provides otherwise, that the Corporation may cause itself to
be:
. discharged from its obligations (with certain exceptions) with respect
to any Senior Notes or series of Senior Notes ("Defeasance"); and
. released from its obligations under certain covenants especially
established with respect to any Senior Notes or series of Senior Notes
and from the obligations described above, if applicable, under "Negative
Pledge" with respect to any such Senior Notes ("Covenant Defeasance"),
in each case on and after the date the Corporation satisfies certain conditions
in the Senior Note Indenture. Those conditions include the irrevocable deposit
with the Senior Indenture Trustee, in trust, of money and/or Government
Obligations (as defined in the Senior Note Indenture), which through the
scheduled payment of principal and interest thereon would provide sufficient
moneys to pay the principal of and any premium and interest on those Senior
Notes on the maturity dates of such payments or upon redemption.
The Senior Note Indenture permits Defeasance with respect to any Senior Notes
of a series even if a prior Covenant Defeasance has occurred with respect to
Senior Notes of that series. Following a Defeasance, payment of the Senior
Notes defeased may not be accelerated because of an Event of Default. Following
a Covenant Defeasance, payment of Senior Notes may not be accelerated by
reference to the covenants noted in the definition of Covenant Defeasance
above. However, if such an acceleration were to occur, the realizable value at
the acceleration date of the money and Government Obligations in the defeasance
trust could be less than the principal and interest then due on such Senior
Notes, since the required deposit in the defeasance trust would be based upon
scheduled cash flows rather than market value, which would vary depending upon
interest rates and other factors.
Under current United States federal income tax law, the Defeasance
contemplated in the preceding paragraphs would be treated as an exchange of the
relevant Senior Notes in which holders of Senior Notes might recognize gain or
loss. In addition, the amount, timing and character of amounts that holders
would be required thereafter to include in income might be different from
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that which would be includible in the absence of such Defeasance. Prospective
investors are urged to consult their own tax advisors as to the specific
consequences of a Defeasance, including the applicability and effect of tax
laws other than United States federal income tax laws.
Under current United States federal income tax laws, unless accompanied by
other changes in the terms of the Senior Notes, Covenant Defeasance should not
be treated as a taxable exchange.
Information Concerning the Senior Indenture Trustee
The Chase Manhattan Bank, which is the Senior Indenture Trustee, also serves
as the Trustee under the Subordinated Note Indenture of the Corporation and as
Property Trustee and Guarantee Trustee with respect to Preferred Securities
issued by the Trusts. The Corporation and certain of its affiliates maintain
deposit accounts and banking relationships with The Chase Manhattan Bank.
Governing Law
The Senior Note Indenture and the Senior Notes will be governed by the
internal laws of the State of New York.
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DESCRIPTION OF THE JUNIOR SUBORDINATED NOTES
A description of the terms of the Junior Subordinated Notes is set forth
below. This description does not purport to be complete and is subject to, and
is qualified in its entirety by reference to, the Subordinated Indenture, dated
as of April 1, 1998, between the Corporation and The Chase Manhattan Bank, as
trustee (the "Subordinated Indenture Trustee"), as supplemented from time to
time (the "Subordinated Note Indenture").
The Corporation may issue series of Subordinated Notes (including series of
Junior Subordinated Notes) from time to time by entering into supplemental
indentures with the Subordinated Indenture Trustee. The Corporation may also
issue series of Subordinated Notes (including series of Junior Subordinated
Notes) from time to time pursuant to resolutions of the Corporation's Board of
Directors or of a duly authorized committee thereof.
The Subordinated Note Indenture, dated as of April 1, 1998, and the form of
supplemental indenture to the Subordinated Note Indenture are exhibits to the
Registration Statement of which this Prospectus is a part. The terms of each
series of Junior Subordinated Notes will include those stated in the
Subordinated Note Indenture for that series and those made a part of the
Subordinated Note Indenture by reference to the Trust Indenture Act of 1939.
General
The Corporation will issue Junior Subordinated Notes under the Subordinated
Note Indenture as one or more series of unsecured subordinated debt securities
(all such series collectively, the "Junior Subordinated Notes" and all series
of Subordinated Notes collectively, the "Subordinated Notes").
The Subordinated Note Indenture does not limit the aggregate principal amount
of Subordinated Notes (including Junior Subordinated Notes) that the
Corporation may issue.
Reference is made to the Prospectus Supplement for a particular series of
Junior Subordinated Notes for the following terms of that series:
. the title of the series;
. any limit on the aggregate principal amount of the Junior Subordinated
Notes of the series;
. the date or dates on which the principal of such Junior Subordinated
Notes will be payable or the method for determining such date or dates,
and the right, if any, of the Corporation to shorten or extend the date
on which the principal of any Junior Subordinated Notes of the series is
payable;
. the rate or rates at which such Junior Subordinated Notes will bear
interest, if any, or the method for determining the rate or rates, and
the date or dates from which any such interest will accrue;
. the interest payment dates on which any such interest will be payable
and the regular record date, if any, for any interest payable on any
interest payment date;
. if applicable, whether the Corporation may extend the interest payment
periods and, if so, the terms of any such extension;
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. the place or places where principal and any premium and interest on such
Junior Subordinated Notes will be payable, if other than the principal
corporate trust office of the Subordinated Indenture Trustee;
. the obligation, if any, of the Corporation to redeem or purchase such
Junior Subordinated Notes pursuant to any sinking fund, purchase fund or
analogous provision or at the option of the holder and the terms and
conditions on which such Junior Subordinated Notes may be redeemed or
purchased pursuant to such obligation;
. the terms and conditions, if any, on which the Corporation may at its
option redeem such Junior Subordinated Notes;
. if applicable, the fact that certain terms of the Subordinated Note
Indenture described below under "--Defeasance and Covenant Defeasance"
will not apply to such Junior Subordinated Notes;
. the currency, currencies or currency units in which principal and any
premium and interest on such Junior Subordinated Notes will be payable,
if other than U.S. dollars, and the manner of determining the equivalent
of those amounts in U.S. dollars for any purpose;
. if the principal or any premium or interest on such Junior Subordinated
Notes is payable, at the election of the Corporation or the holder, in
one or more currencies or currency units other than those in which such
Junior Subordinated Notes are stated to be payable, then the currency,
currencies or currency units in which those payments will be made, the
terms and conditions upon which the election is to be made and the
amount so payable (or the manner of determining that amount);
. the portion of the principal amount of such Junior Subordinated Notes
which will be payable upon declaration of acceleration of maturity, if
other than the entire principal amount;
. whether any such Junior Subordinated Notes will be issuable as global
securities ("Global Securities") and, if so, the depositary and any
provisions for the transfer or exchange of the Global Securities, if
different from those described below under "--Global Securities";
. any addition to, deletion from or change in Events of Default or
covenants with respect to such Junior Subordinated Notes;
. any index or formula for determining the amount of principal or any
premium or interest on such Junior Subordinated Notes and the manner of
determining those amounts;
. if the principal amount payable on the maturity date of such Junior
Subordinated Notes will not be determinable on any one or more dates
prior to the maturity date, the amount which will be deemed to be the
principal amount as of any such date for any purpose, including the
principal amount which will be due and payable upon any maturity other
than the maturity date (or the manner of determining any such amount);
and
. any other terms of the Junior Subordinated Notes.
Unless the applicable Prospectus Supplement states otherwise, the Junior
Subordinated Notes will be issued only in fully registered form, without
coupons, and there will be no service charge for any registration of transfer
or exchange of the Junior Subordinated Notes. The Corporation may, however,
require payment to cover any tax or other governmental charge payable in
connection with such registration of transfer or exchange.
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The interest rate and interest and other payment dates of each series of
Junior Subordinated Notes issued to a Trust will correspond to those of the
Preferred Securities of that Trust.
The Subordinated Note Indenture does not contain provisions that afford
holders of Junior Subordinated Notes protection in the event of a highly
leveraged transaction involving the Corporation.
Subordination
Each series of Junior Subordinated Notes will be subordinate and junior in
right of payment, to the extent set forth in the Subordinated Note Indenture,
to all Senior Indebtedness of the Corporation. In the event, subject to certain
exceptions, (1) of any payment by, or distribution of assets of, the
Corporation to creditors upon any dissolution, winding-up, liquidation or
reorganization of the Corporation, whether in bankruptcy, insolvency or other
proceedings, or (2) that (a) a default (beyond any grace period) has occurred
and is continuing with respect to the payment of principal, interest or any
other monetary amounts due and payable on any Senior Indebtedness or (b) the
maturity of any Senior Indebtedness has been accelerated because of a default
with respect to such Senior Indebtedness, then the holders of all Senior
Indebtedness will be entitled to receive payment, in the case of (1) above, of
all amounts due or to become due upon all Senior Indebtedness and, in the case
of (2) above, of all amounts due on such Senior Indebtedness, or provision will
be made for such payment, before the holders of any series of Junior
Subordinated Notes are entitled to receive payments of principal or interest on
such Junior Subordinated Notes.
The term "Senior Indebtedness" is defined in the Subordinated Note Indenture
to mean, with respect to any series of Subordinated Notes, the principal of,
and premium, if any, and interest on and any other payment in respect of
indebtedness due pursuant to any of the following, whether outstanding at the
date of execution of the Subordinated Note Indenture or thereafter incurred,
created or assumed: (1) all indebtedness of the Corporation evidenced by notes,
debentures, bonds or other securities sold by the Corporation for money or
other obligations for money borrowed, (2) all indebtedness of others of the
kinds described in the preceding clause (1) assumed by or guaranteed in any
manner by the Corporation or in effect guaranteed by the Corporation through an
agreement to purchase, contingent or otherwise, and (3) all renewals,
extensions or refundings of indebtedness of the kinds described in either of
the preceding clauses (1) and (2), unless, in the case of any particular
indebtedness, renewal, extension or refunding, the instrument creating or
evidencing the same or the assumption or guarantee of the same by its terms
provides that such indebtedness, renewal, extension or refunding is not
superior in right of payment to or is equal in right of payment with such
Subordinated Notes. Such Senior Indebtedness will continue to be Senior
Indebtedness and be entitled to the benefits of the subordination provisions in
the Subordinated Note Indenture irrespective of any amendment, modification or
waiver of any term of such Senior Indebtedness.
The Corporation conducts its business through subsidiaries. Accordingly, the
ability of the Corporation to meet its obligations under the Junior
Subordinated Notes will be dependent on the earnings and cash flows of its
subsidiaries and the ability of its subsidiaries to pay dividends or to advance
or repay funds to the Corporation. In addition, the rights of the Corporation
and its creditors to participate in the assets of any subsidiary upon the
subsidiary's liquidation or recapitalization will be subject to the prior
claims of the subsidiary's creditors.
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Certain future series of Subordinated Notes may rank senior to series of
Junior Subordinated Notes and hence would constitute Senior Indebtedness with
respect to those series.
The Subordinated Note Indenture does not limit the amount of Senior
Indebtedness that the Corporation may issue. As of September 30, 1998, Senior
Indebtedness of the Corporation totaled approximately $1,728,797,000.
GLOBAL SECURITIES
Some or all of the Subordinated Notes of a series may be represented in whole
or in part by one or more Global Securities deposited with or on behalf of one
or more depositaries.
The applicable Prospectus Supplement will describe the terms of any
depositary arrangement. The Corporation anticipates that the following
provisions will apply to all depositary arrangements for Subordinated Notes
represented by Global Securities.
Unless the applicable Prospectus Supplement states otherwise, Subordinated
Notes which are to be represented by a Global Security deposited with or on
behalf of a depositary will be represented by a Global Security registered in
the name of that depositary or its nominee. Upon the issuance of a Global
Security in registered form, the depositary for such Global Security will
credit, on its book-entry registration and transfer system, the respective
principal amount of the Subordinated Notes represented by such Global Security
to the accounts of institutions that have accounts with such depositary or its
nominee ("participants"). The accounts to be credited will be designated by the
underwriters or agents of such Subordinated Notes or by the Corporation, if
such Subordinated Notes are offered and sold directly by the Corporation.
Ownership of beneficial interests in such Global Securities will be limited to
participants or persons that may hold interests through participants. Ownership
of beneficial interests by participants in such Global Securities will be shown
on, and the transfer of any such ownership interest will be effected only
through, records maintained by the depositary or its nominee for such Global
Security. Ownership of beneficial interests in Global Securities by persons
that hold through participants will be effected only through records maintained
by such participants. The laws of some jurisdictions require that certain
purchasers of securities take physical delivery of such securities in
definitive form. Such limits and such laws may impair the ability to transfer
beneficial interests in a Global Security.
So long as the depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such depositary or such nominee, as
the case may be, will be considered the sole owner or holder of the
Subordinated Notes represented by such Global Security for all purposes under
the Subordinated Note Indenture. Except as set forth below, owners of
beneficial interests in the Global Security will not be entitled to have the
Subordinated Notes represented by such Global Security registered in their
names, will not receive or be entitled to receive physical delivery of the
Subordinated Notes in definitive form and will not be considered the owners or
holders thereof under the Subordinated Note Indenture.
Payment of principal of and any premium and interest on Subordinated Notes
registered in the name of or held by a depositary or its nominee will be made
in immediately available funds to the
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depositary or its nominee, as the case may be, as the registered owner or the
holder of the Global Security representing such Subordinated Notes. None of the
Corporation, the Subordinated Indenture Trustee, any paying agent or the
registrar and transfer agent for such Subordinated Notes will have any
responsibility or liability for any aspect of the records relating to, or
payments made on account of, beneficial ownership interests in a Global
Security for such Subordinated Notes or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
The Corporation expects that a depositary for Subordinated Notes of a series,
upon receipt of any payment of principal or any premium or interest in respect
of a Global Security, will credit immediately participants' accounts with
payment in amounts proportionate to their respective beneficial interests in
the principal amount of such Global Security as shown on the records of such
depositary. The Corporation also expects that payments by participants to
owners of beneficial interests in such Global Security held through such
participants will be governed by standing instructions and customary practices,
as is now the case with securities held for the accounts of customers
registered in "street name," and will be the responsibility of such
participants.
A Global Security may not be transferred in whole or in part except by the
depositary for such Global Security to a nominee of such depositary or by a
nominee of such depositary to such depositary or another nominee of such
depositary or by such depositary or any such nominee to a successor depositary
or a nominee of such successor depositary. If a depositary for Subordinated
Notes of a series is at any time unwilling or unable to continue as depositary
and a successor depositary is not appointed by the Corporation within 90 days
or if at any time the depositary ceases to be a clearing agency registered
under the Securities Exchange Act of 1934 when the depositary is required to be
registered to act as such depositary and no successor is appointed by the
Corporation within 90 days, then the Corporation will issue Subordinated Notes
in definitive registered form in exchange for the Global Security or Global
Securities representing such Subordinated Notes. In addition, the Corporation
may at any time determine not to have any Subordinated Notes represented by one
or more Global Securities and, in such event, will issue Subordinated Notes in
definitive registered form in exchange for the Global Securities representing
such Subordinated Notes. In any such instance, an owner of a beneficial
interest in a Global Security will be entitled to physical delivery in
definitive form of Subordinated Notes represented by such Global Security equal
in principal amount to such beneficial interest and to have such Subordinated
Notes registered in its name.
Events of Default
The following will be Events of Default under the Subordinated Note Indenture
with respect to each series of Junior Subordinated Notes (unless not applicable
to the particular series or unless deleted or modified in a supplemental
indenture as stated in the applicable Prospectus Supplement):
. failure to pay principal of or any premium on any Junior Subordinated
Note of that series when due;
. failure to pay any interest on any Junior Subordinated Note of that
series when due, continued for 60 days; provided, however, that the date
on which such payment is due and payable will be the date on which the
Corporation is required to make payment following any deferral of
interest payments by the Corporation under the terms of such Junior
Subordinated Notes;
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. failure to perform any covenant of the Corporation in the Subordinated
Note Indenture (other than a covenant that is solely for the benefit of
other series), continued for 90 days after the Subordinated Indenture
Trustee or the holders of at least 33% in principal amount of the
outstanding Junior Subordinated Notes of that series give written notice
of the default (unless the Subordinated Indenture Trustee or the
Subordinated Indenture Trustee and the holders of a principal amount of
Junior Subordinated Notes of that series not less than the principal
amount of Junior Subordinated Notes the holders of which had given notice
of default extend that time period) (the Subordinated Indenture Trustee,
or the Subordinated Indenture Trustee and such holders, as the case may
be, will be deemed to have agreed to such an extension if the Corporation
has initiated and is diligently pursuing corrective action); and
. certain events in bankruptcy, insolvency or reorganization of the
Corporation.
If an Event of Default with respect to Junior Subordinated Notes of a series
occurs and is continuing, then the Subordinated Indenture Trustee or the
holders of not less than 33% in principal amount of the outstanding Junior
Subordinated Notes of that series may, by notice to the Corporation (and to the
Subordinated Indenture Trustee if given by holders), declare to be immediately
due and payable the principal amount of all Junior Subordinated Notes of that
series. However, that Event of Default will be deemed waived at any time after
the declaration of acceleration but before a judgment or decree for payment of
the money due has been obtained if:
. the Corporation has paid or deposited with the Subordinated Indenture
Trustee all overdue interest, the principal of and any premium due
otherwise than by such declaration of acceleration and interest thereon,
and any interest on overdue interest (to the extent permitted by
applicable law), in each case with respect to the Junior Subordinated
Notes of such series, and all amounts due to the Subordinated Indenture
Trustee under the Subordinated Note Indenture; and
. all Events of Default with respect to that series (other than the
nonpayment of the principal which became due solely by such declaration
of acceleration) have been cured or waived.
A holder of Preferred Securities may institute a legal proceeding directly
against the Corporation, without first instituting a legal proceeding against
the Property Trustee or any other person or entity, for enforcement of payment
to such holder of principal of or interest on the Junior Subordinated Notes of
the related series having a principal amount equal to the aggregate liquidation
amount of the Preferred Securities of such holder on or after the due dates
specified in the Junior Subordinated Notes of that series.
Subject to the provisions of the Subordinated Note Indenture relating to the
duties of the Subordinated Indenture Trustee in case of a continuing Event of
Default, the Subordinated Indenture Trustee will be under no obligation to
exercise any of its rights or powers under the Subordinated Note Indenture at
the request or direction of any of the holders unless those holders have
offered reasonable indemnity against the costs, expenses and liabilities which
the Subordinated Indenture Trustee might incur as a result. Subject to such
provisions for indemnification and to certain other rights of the Subordinated
Indenture Trustee, the holders of a majority in principal amount of the
outstanding Subordinated Notes of any series have the right to direct the time,
method and place of conducting any proceedings for any remedy available to the
Subordinated Indenture Trustee or exercising any trust or power conferred on
the Subordinated Indenture Trustee with respect to the
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Subordinated Notes of that series. The Subordinated Indenture Trustee may
withhold notice to the holders of Subordinated Notes of any series of any
default (except in payment of principal or interest) with respect to that
series if the Subordinated Indenture Trustee in good faith considers it in the
interest of holders to do so.
No holder of a Junior Subordinated Note of any series will have any right to
institute a proceeding with respect to the Subordinated Note Indenture or for
any remedy under the Subordinated Note Indenture unless:
. that holder has previously given the Subordinated Indenture Trustee
written notice of a continuing Event of Default with respect to the
Junior Subordinated Notes of that series;
. the holders of a majority in principal amount of the outstanding Junior
Subordinated Notes of that series have made written request to institute
the proceeding;
. such holder or holders have offered reasonable indemnity to the
Subordinated Indenture Trustee;
. the Subordinated Indenture Trustee has failed to institute the proceeding
for 60 days after receipt of the notice and offer of indemnity; and
. the Subordinated Indenture Trustee has not received from the holders of a
majority in principal amount of the outstanding Junior Subordinated Notes
of that series a direction inconsistent with the written request.
Notwithstanding the foregoing, the holder of any Junior Subordinated Note will
have an absolute and unconditional right to receive payment of the principal of
and any premium and, subject to certain limitations, interest on that Junior
Subordinated Note on its maturity date (or, in the case of redemption, the date
of redemption) and to institute suit for the enforcement of any such payment.
The Corporation is required to furnish annually to the Subordinated Indenture
Trustee an officers' certificate to the effect that, to the best knowledge of
the officers providing the certificate, the Corporation is not in default under
the Subordinated Note Indenture or, if there has been a default, specifying the
default and its status.
Registration and Transfer
If Junior Subordinated Notes of a series are to be redeemed, the Corporation
will not be required to:
. issue, register the transfer of, or exchange any Junior Subordinated
Notes of that series during the 15 days immediately preceding the date
notice is mailed identifying the Junior Subordinated Notes that are
called for redemption; or
. register the transfer of or exchange any Junior Subordinated Note
selected for redemption, in whole or in part, except the unredeemed
portion of any Junior Subordinated Note being redeemed in part.
Denominations
Junior Subordinated Notes will be issuable in denominations of $1,000 and any
integral multiples of $1,000, unless the applicable Prospectus Supplement
states otherwise.
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Payment and Paying Agent
Principal of Junior Subordinated Notes will be paid only against surrender of
the Junior Subordinated Notes to the paying agent. Unless the applicable
Prospectus Supplement states otherwise, interest on Junior Subordinated Notes
will be payable, subject to surrender if applicable, at the office of the
paying agent or, at the option of the Corporation, (1) by wire transfer to an
account at a banking institution in the United States that the person entitled
to the interest designates in writing to the Subordinated Indenture Trustee at
least 16 days prior to the date of payment or (2) by check mailed to the
address of the person entitled to the interest as such address appears in the
security register for such Junior Subordinated Notes.
Unless the applicable Prospectus Supplement states otherwise, the
Subordinated Indenture Trustee will act as paying agent for the Junior
Subordinated Notes, and the principal corporate trust office of the
Subordinated Indenture Trustee will serve as the office through which the
paying agent acts. The Corporation may, however, designate additional paying
agents, rescind the designation of any paying agents or approve a change in the
office through which any paying agent acts.
All moneys that the Corporation has paid to a paying agent for payment of
principal of or interest on Junior Subordinated Notes which remain unclaimed at
the end of two years after such principal or interest has become due and
payable will be repaid to the Corporation at the Corporation's request. Holders
will thereafter look only to the Corporation for such payments.
Modification; Waiver
The Corporation and the Subordinated Indenture Trustee may, with certain
exceptions, amend or modify the Subordinated Note Indenture with the consent of
the holders of a majority in aggregate principal amount of the outstanding
Subordinated Notes of all series of Subordinated Notes affected by the
amendment or modification (voting as one class). No amendment or modification
may, however, without the consent of the holder of each outstanding
Subordinated Note affected thereby:
. change the stated maturity of the principal of, or any installment of
principal of or interest on, any Subordinated Note;
. reduce the principal amount of, the rate of interest on, or any premium
payable upon the redemption of any Subordinated Note;
. reduce the amount of principal of any Subordinated Note due and payable
upon acceleration of the maturity thereof;
. change the currency of payment of principal of, or any premium or
interest on, any Subordinated Note;
. impair the right to institute suit for the enforcement of any such
payment on any Subordinated Note on or after the stated maturity (or date
of redemption);
. reduce the percentage in principal amount of Subordinated Notes of any
series, the consent of whose holders is required to amend or modify the
Subordinated Note Indenture, to waive compliance with certain provisions
of the Subordinated Note Indenture or to waive certain defaults; or
. with certain exceptions, modify the foregoing provisions or the sections
of the Subordinated Note Indenture governing waiver of certain covenants
and past defaults.
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In addition, the Corporation and the Subordinated Indenture Trustee may execute
supplemental indentures to create new series of Subordinated Notes and for
certain other purposes, without the consent of any holders of Subordinated
Notes.
The holders of a majority in aggregate principal amount of the outstanding
Subordinated Notes of any series may waive, for that series, the Corporation's
compliance with certain restrictive provisions of the Subordinated Note
Indenture. The holders of a majority in aggregate principal amount of the
outstanding Subordinated Notes of all series under the Subordinated Note
Indenture with respect to which a default has occurred and is continuing
(voting as one class) may waive that default for all such series, except a
default in the payment of principal of, or any premium or interest on, any
Subordinated Note of such series or a default with respect to a covenant or
provision under the Subordinated Note Indenture which cannot be amended or
modified without the consent of the holder of each outstanding Subordinated
Note affected.
The Subordinated Note Indenture may not be amended to alter the subordination
of any Junior Subordinated Notes or any other Subordinated Notes without the
written consent of each holder of Senior Indebtedness then outstanding that
would be adversely affected.
Consolidation, Merger, Conveyance or Transfer
The Subordinated Note Indenture provides that the Corporation may consolidate
or merge with or into another corporation or other entity of a sort specified
in the Subordinated Note Indenture, or convey or transfer its properties and
assets as an entirety or substantially as an entirety to any such entity;
provided, however, that the successor, if any, assumes by supplemental
indenture the Corporation's obligations under the Subordinated Note Indenture
and the Subordinated Notes issued thereunder and the Corporation delivers an
officers' certificate and an opinion of counsel to the Subordinated Indenture
Trustee stating that all conditions precedent in the Subordinated Note
Indenture relating to the consolidation, merger, conveyance or transfer have
been complied with. Upon the assumption by the successor of the Corporation's
obligations under the Subordinated Note Indenture and the Subordinated Notes
issued thereunder and the satisfaction of any other conditions precedent
provided for in the Subordinated Note Indenture, the successor will succeed to
and be substituted for the Corporation under the Subordinated Note Indenture,
and the Corporation will be relieved of its obligations under the Subordinated
Note Indenture and the Subordinated Notes.
Defeasance and Covenant Defeasance
The Subordinated Note Indenture provides, unless the terms of the particular
series of Subordinated Notes provides otherwise, that the Corporation may cause
itself to be:
. discharged from its obligations (with certain exceptions) with respect
to any Subordinated Notes or series of Subordinated Notes
("Defeasance"); and
. released from its obligations under certain covenants especially
established with respect to such series ("Covenant Defeasance"),
in each case on and after the date the Corporation satisfies certain conditions
in the Subordinated Note Indenture. Those conditions include the irrevocable
deposit with the Subordinated Indenture Trustee, in trust, of money and/or
Government Obligations (as defined in the Subordinated Note
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Indenture) which through the scheduled payment of principal and interest
thereon would provide sufficient moneys to pay the principal of and any premium
and interest on those Subordinated Notes on the maturity dates of those
payments or upon redemption.
The Subordinated Note Indenture permits Defeasance with respect to any
Subordinated Notes of a series even if a prior Covenant Defeasance has occurred
with respect to Subordinated Notes of that series. Following a Defeasance,
payment of the Subordinated Notes defeased may not be accelerated because of an
Event of Default. Following a Covenant Defeasance, payment of Subordinated
Notes may not be accelerated by reference to the covenants noted in the
definition of Covenant Defeasance above. However, if such an acceleration were
to occur, the realizable value at the acceleration date of the money and
Government Obligations in the defeasance trust could be less than the principal
and interest then due on such Subordinated Notes since the required deposit in
the defeasance trust would be based upon scheduled cash flows rather than
market value, which would vary depending upon interest rates and other factors.
Under current United States federal income tax laws, the Defeasance
contemplated in the preceding paragraphs would be treated as an exchange of the
relevant Subordinated Notes in which holders of Subordinated Notes might
recognize gain or loss. In addition, the amount, timing and character of
amounts that holders would be required thereafter to include in income might be
different from that which would be includible in the absence of such
Defeasance. Prospective investors are urged to consult their own tax advisors
as to the specific consequences of a Defeasance, including the applicability
and effect of tax laws other than United States federal income tax laws.
Under current United States federal income tax laws, unless accompanied by
other changes in the terms of the Subordinated Notes, Covenant Defeasance
should not be treated as a taxable exchange.
Information Concerning the Subordinated Indenture Trustee
The Chase Manhattan Bank, which is the Subordinated Indenture Trustee, also
serves as the Senior Indenture Trustee and as Property Trustee and Guarantee
Trustee. The Corporation and certain of its affiliates maintain deposit
accounts and banking relationships with The Chase Manhattan Bank.
Governing Law
The Subordinated Note Indenture and the Subordinated Notes (including the
Junior Subordinated Notes) will be governed by the internal laws of the State
of New York.
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DESCRIPTION OF THE PREFERRED SECURITIES
Each Trust may issue only one series of Preferred Securities. The Trust
Agreement of each Trust will authorize the Administrative Trustees to issue the
Preferred Securities of that Trust on behalf of the Trust.
The Preferred Securities of each Trust will have such terms--including
distribution, redemption, voting and liquidation rights, and such other
preferred, deferral or other special rights or such restrictions--as are set
forth in the Trust Agreement of that Trust. Reference is made to the Prospectus
Supplement relating to the Preferred Securities of a Trust for specific terms,
including:
. the designation of the Preferred Securities;
. the number of Preferred Securities issued by the Trust;
. the annual distribution rate (or method of determining such rate) for
the Preferred Securities and the date or dates on which distributions
are payable;
. the date or dates, or method of determining the date or dates, from
which distributions on the Preferred Securities will be cumulative;
. the amount or amounts that will be paid out of the assets of the Trust
to the holders of the Preferred Securities upon the voluntary or
involuntary dissolution, winding-up or termination of the Trust;
. the obligation, if any, of the Trust to purchase or redeem the Preferred
Securities and the price or prices at which, the period or periods
within which, and the terms and conditions upon which the Preferred
Securities will be purchased or redeemed, in whole or in part, pursuant
to that obligation;
. any voting rights of the Preferred Securities in addition to those
required by law, including any requirement for approval by the holders
of Preferred Securities as a condition to specified action or amendments
to the Trust Agreement of the Trust;
. the right, if any, to defer distributions on the Preferred Securities
upon extension of the interest payment period on the related Junior
Subordinated Notes; and
. any other relative rights, preferences, privileges, limitations or
restrictions of the Preferred Securities not inconsistent with the Trust
Agreement of the Trust or applicable law.
The Corporation will guarantee all Preferred Securities offered hereby to the
extent set forth under "Description of the Guarantees."
Any material United States federal income tax considerations applicable to an
offering of Preferred Securities will be described in the applicable Prospectus
Supplement.
33
<PAGE>
DESCRIPTION OF THE GUARANTEES
A summary of information about the Guarantees that the Corporation will
execute and deliver for the benefit of the holders of the Preferred Securities
of the respective Trusts from time to time is set forth below. The summary does
not purport to be complete and is subject in all respects to the provisions of,
and is qualified in its entirety by reference to, the Guarantees and the Trust
Indenture Act of 1939. The Corporation has filed the form of the Guarantee as
an exhibit to the Registration Statement of which this Prospectus is a part.
Each Guarantee will be qualified as an indenture under the Trust Indenture
Act of 1939. The Chase Manhattan Bank will act as indenture trustee under each
Guarantee (the "Guarantee Trustee") for purposes of such Act. The terms of each
Guarantee will be those set forth in that Guarantee and those made part of that
Guarantee by such Act.
Each Guarantee will be held by the Guarantee Trustee for the benefit of the
holders of the Preferred Securities to which it relates.
General
Under each Guarantee, the Corporation will irrevocably and unconditionally
agree, to the extent set forth in the Guarantee, to pay the Guarantee Payments
(as defined below) in full to the holders of the Preferred Securities to which
the Guarantee relates, to the extent not paid by or on behalf of the related
Trust, regardless of any defense, right of set-off or counterclaim that the
Corporation may have or assert against any person.
The following payments or distributions (without duplication) with respect to
the Preferred Securities of any Trust, to the extent not paid or made by or on
behalf of such Trust (the "Guarantee Payments"), will be subject to the related
Guarantee:
. any accrued and unpaid distributions required to be paid on the
Preferred Securities of the Trust, but if and only if and to the extent
that the Trust has funds legally and immediately available therefor;
. the redemption price, including all accrued and unpaid distributions to
the date of redemption, with respect to any Preferred Securities called
for redemption by the Trust, but if and only to the extent the Trust has
funds legally and immediately available therefor; and
. upon a dissolution, winding-up or termination of the Trust (other than
in connection with the distribution of Junior Subordinated Notes to the
holders of Trust Securities of the Trust or the redemption of all of the
Preferred Securities of the Trust), the lesser of (1) the aggregate of
the liquidation amount and all accrued and unpaid distributions on the
Preferred Securities of the Trust to the date of payment, to the extent
the Trust has funds legally and immediately available therefor, and (2)
the amount of assets of the Trust remaining available for distribution
to holders of Preferred Securities of the Trust in liquidation of the
Trust.
The Corporation's obligation to make a Guarantee Payment may be satisfied by
the Corporation's directly paying the required amounts to the holders of the
related Preferred Securities or by causing the related Trust to pay such
amounts to those holders.
34
<PAGE>
Each Guarantee will be a full and unconditional guarantee, subject to certain
subordination provisions, of the Guarantee Payments with respect to the related
Preferred Securities from the time of issuance of those Preferred Securities,
but will not apply to the payment of distributions and other payments on those
Preferred Securities when the related Trust does not have sufficient funds
legally and immediately available to make such distributions or other payments.
If the Corporation does not make the required payments on the Junior
Subordinated Notes held by the Property Trustee under a Trust, that Trust will
not make the related payments on its Preferred Securities.
Subordination
The Corporation's obligations under each Guarantee to make the Guarantee
Payments will constitute an unsecured obligation of the Corporation and will
rank:
. subordinate and junior in right of payment to all other liabilities of
the Corporation, including the Junior Subordinated Notes, except those
obligations or liabilities made equal in priority or subordinate by
their terms;
. equal in priority with the most senior preferred stock that may be
issued by the Corporation; and
. senior to all common stock of the Corporation.
The terms of the Preferred Securities will provide that each holder of
Preferred Securities by acceptance thereof agrees to the subordination
provisions and other terms of the applicable Guarantee.
Each Guarantee will constitute a guarantee of payment and not of collection
(that is, the guaranteed party may institute a legal proceeding directly
against the guarantor to enforce its rights under the guarantee without first
instituting a legal proceeding against any other person or entity).
Amendments and Assignment
No consent of the holders of Preferred Securities will be required with
respect to any changes in a Guarantee that do not materially and adversely
affect the rights of holders of those Preferred Securities. Other amendments to
a Guarantee may be made only with the prior approval of the holders of not less
than 66 2/3% in liquidation amount of the outstanding Preferred Securities to
which the Guarantee relates. All guarantees and agreements contained in a
Guarantee will bind the successors, assigns, receivers, trustees and
representatives of the Corporation and will inure to the benefit of the holders
of the related Preferred Securities then outstanding.
Termination
Each Guarantee will terminate and be of no further force and effect as to the
related Preferred Securities upon:
. full payment of the redemption price of the related Preferred
Securities;
. distribution of the related Junior Subordinated Notes to the holders of
those Preferred Securities; or
. full payment of the amounts payable upon liquidation of the related
Trust.
35
<PAGE>
Each Guarantee will continue to be effective or will be reinstated, as the
case may be, if at any time any holder of the Preferred Securities to which the
Guarantee relates must restore payment of any sums paid with respect to those
Preferred Securities or under the Guarantee.
Events of Default
An event of default under a Guarantee will occur upon the failure by the
Corporation to perform any of its payment obligations under that Guarantee.
The holders of a majority in liquidation amount of the Preferred Securities
to which the Guarantee relates 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 or
power conferred upon the Guarantee Trustee under that Guarantee. Any holder of
the Preferred Securities to which the Guarantee relates may institute a legal
proceeding directly against the Corporation to enforce its rights under the
Guarantee without first instituting a legal proceeding against the Guarantee
Trustee or any other person or entity.
The holders of a majority in liquidation amount of Preferred Securities of
any series may, by vote, on behalf of the holders of all the Preferred
Securities of that series, waive any past event of default and its
consequences.
Information Concerning the Guarantee Trustee
Prior to the occurrence of an event of default with respect to a Guarantee
and after the curing or waiving of all events of default with respect to that
Guarantee, the Guarantee Trustee undertakes to perform only those duties as are
specifically set forth in that Guarantee. In case an event of default has
occurred and has not been cured or waived, the Guarantee Trustee will exercise
the same degree of care as a prudent individual would exercise in the conduct
of his or her own affairs. Subject to these provisions, the Guarantee Trustee
is under no obligation to exercise any of the powers vested in it by a
Guarantee at the request of any holder of the related Preferred Securities,
unless offered reasonable indemnity against the costs, expenses and liabilities
which the Guarantee Trustee might incur as a result.
The Chase Manhattan Bank will be the Guarantee Trustee with respect to each
Guarantee. The Chase Manhattan Bank will also serve as Property Trustee,
Subordinated Indenture Trustee and Senior Indenture Trustee. The Corporation
and certain of its affiliates maintain deposit accounts and banking
relationships with The Chase Manhattan Bank.
Governing Law
Each Guarantee will be governed by the internal laws of the State of New
York.
Agreements as to Expenses and Liabilities
The Corporation will enter into an Agreement as to Expenses and Liabilities
under each Trust Agreement. Each Agreement as to Expenses and Liabilities will
provide that the Corporation will irrevocably and unconditionally guarantee to
each person or entity to whom the related Trust becomes indebted or liable the
full payment of any indebtedness, expenses or liabilities of that Trust, other
than obligations of the Trust to pay to the holders of the related Preferred
Securities or other similar interests in that Trust the amounts due such
holders under the terms of those Preferred Securities or similar interests.
36
<PAGE>
ACCOUNTING TREATMENT
Each Trust will be treated as a subsidiary of the Corporation for financial
reporting purposes. Accordingly, the accounts of the Trusts will be included in
the Corporation's consolidated financial statements. The Preferred Securities
will be presented as a separate line item in the Corporation's consolidated
balance sheets, entitled "Guaranteed Preferred Beneficial Interests in
Corporation's Subordinated Notes." For financial reporting purposes, the
Corporation will record distributions payable on the Preferred Securities as an
expense in the consolidated statement of income.
PLAN OF DISTRIBUTION
The Corporation may sell the Senior Notes and the Junior Subordinated Notes
and the Trusts may sell the Preferred Securities in one or more of the
following ways from time to time:
. to underwriters for resale to the public or to institutional investors;
. directly to institutional investors; or
. through agents to the public or to institutional investors.
The Prospectus Supplement for each series of Senior Notes, Junior
Subordinated Notes or Preferred Securities will set forth the terms of the
offering of those Senior Notes, Junior Subordinated Notes or Preferred
Securities, including the name or names of any underwriters or agents. The
Prospectus Supplement for each series of Senior Notes, Junior Subordinated
Notes or Preferred Securities will also set forth the purchase price of such
Senior Notes, Junior Subordinated Notes or Preferred Securities, the proceeds
to the Corporation or the applicable Trust from such sale, any underwriting
discounts or agency fees and other items constituting underwriters' or agents'
compensation, any initial public offering price, any discounts or concessions
allowed or reallowed or paid to dealers, and any securities exchange on which
such Senior Notes, Junior Subordinated Notes or Preferred Securities may be
listed.
If underwriters participate in the sale, such Senior Notes, Junior
Subordinated Notes or Preferred Securities will be acquired by the underwriters
for their own account and may be resold from time to time in one or more
transactions, including negotiated transactions, at a fixed public offering
price or at varying prices determined at the time of sale.
Unless the applicable Prospectus Supplement states otherwise, the obligations
of the underwriters to purchase any series of Senior Notes, Junior Subordinated
Notes or Preferred Securities will be subject to certain conditions precedent
and the underwriters will be obligated to purchase all of such series of Senior
Notes, Junior Subordinated Notes or Preferred Securities, if any are purchased.
Underwriters and agents may be entitled under agreements entered into with
the Corporation and/or the applicable Trust to indemnification against certain
civil liabilities, including liabilities under the Securities Act of 1933.
Underwriters and agents may engage in transactions with, or perform services
for, the Corporation in the ordinary course of business.
Each series of Senior Notes, Junior Subordinated Notes or Preferred
Securities will be a new issue of securities and will have no established
trading market. Any underwriters to whom Senior Notes, Junior Subordinated
Notes or Preferred Securities are sold for public offering and sale may
37
<PAGE>
make a market in those Senior Notes, Junior Subordinated Notes or Preferred
Securities. However, those underwriters will not be obligated to do so and may
discontinue any market making at any time without notice.
The Senior Notes, Junior Subordinated Notes or Preferred Securities may or
may not be listed on a national securities exchange.
VALIDITY OF THE SECURITIES
Richards, Layton & Finger, P.A., Wilmington, Delaware, special Delaware
counsel to the Corporation and the Trusts, will pass upon certain matters of
Delaware law relating to the validity of the Preferred Securities on behalf of
the Corporation and the Trusts. Dewey Ballantine LLP, New York, New York, will
pass upon the validity of the Senior Notes, the Junior Subordinated Notes and
the Guarantees and certain related matters on behalf of the Corporation.
Sullivan & Cromwell, New York, New York, will pass upon the validity of the
Senior Notes, the Junior Subordinated Notes and the Guarantees for the
underwriters or agents.
EXPERTS
The consolidated financial statements included in the Form 10, which are
incorporated in this Prospectus by reference, have been audited by Deloitte &
Touche LLP, independent auditors, as stated in their report which is
incorporated in this Prospectus by reference, and have been so incorporated in
reliance upon such report given upon the authority of that firm as experts in
accounting and auditing. The consolidated financial statements included in
PanEnergy's annual report on Form 10-K for the year ended December 31, 1996
have been incorporated by reference in this Prospectus and in the Registration
Statement in reliance upon the report of KPMG LLP, independent certified public
accountants, incorporated by reference in this Prospectus, and upon the
authority of said firm as experts in accounting and auditing.
38
<PAGE>
[ ]
Preferred Securities
Duke Capital
Financing Trust [ ]
% Cumulative Trust Preferred Securities
(Liquidation amount
$ per Preferred Security)
Fully and unconditionally guaranteed,
as set forth herein, by
Duke Capital
Corporation
a subsidiary of Duke Energy Corporation
-------------------------------
PROSPECTUS SUPPLEMENT
-------------------------------
[Names of Underwriters]
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PART II.
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution:
The estimated expenses of issuance and distribution, other than underwriting
discounts and commissions, to be borne by the Corporation are as follows:
<TABLE>
<S> <C>
Securities and Exchange Commission Filing Fee................ $ 278,000*
Trustee Fees and Expenses.................................... 40,000
Listing Fees of New York Stock Exchange...................... 166,000
Printing Costs............................................... 155,000
Legal Fees and Expenses...................................... 175,000
Accounting Fees.............................................. 25,000
Blue Sky Fees and Expenses................................... 22,000
Rating Agency Fees........................................... 270,000
Miscellaneous................................................ 4,000
----------
Total...................................................... $1,135,000
==========
</TABLE>
--------
* Actual
Item 15. Indemnification of Directors and Officers.
Section 2 of Article X of the Restated Certificate of Incorporation of the
Corporation provides as follows:
"(a) Right to Indemnification. Each person who was or is made a party or is
threatened to be made a party to or is involved in any action, suit or
proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding"), by reason of the fact that such person, or a
person of whom such person is the legal representative, is or was a director or
officer of the Corporation or is or was serving at the request of the
Corporation as a director, officer, employee or agent of another corporation or
of a partnership, joint venture, trust or other enterprise, including service
with respect to employee benefit plans, whether the basis of such proceeding is
alleged action in an official capacity as a director, officer, employee or
agent or in any other capacity while serving as a director, officer, employee
or agent, shall be indemnified and held harmless by the Corporation to the
fullest extent authorized by the DGCL, as the same exists or may hereafter be
amended (but, in the case of any such amendment, only to the extent that such
amendment permits the Corporation to provide broader indemnification rights
than said law permitted the Corporation to provide prior to such amendment),
against all expense, liability and loss (including attorneys' fees, judgments,
fines, amounts paid or to be paid in settlement, and excise taxes or penalties
arising under the Employee Retirement Income Security Act of 1974, as in effect
from time to time) reasonably incurred or suffered by such person in connection
therewith and such indemnification shall continue as to a person who has ceased
to be a director, officer, employee or agent and shall inure to the benefit of
such person's heirs, executors and administrators; provided, however, that,
except as provided in paragraph (b) hereof, the Corporation shall indemnify any
such person seeking indemnification in connection with a proceeding (or part
thereof) initiated by such person only if such proceeding (or part thereof) was
authorized by the Board. The right to indemnification conferred in this Section
shall be a contract right and shall include the right to have the Corporation
pay the expenses incurred in
II-1
<PAGE>
defending any such proceeding in advance of its final disposition; any advance
payments to be paid by the Corporation within 20 calendar days after the
receipt by the Corporation of a statement or statements from the claimant
requesting such advance or advances from time to time; provided, however, that,
if and to the extent the DGCL requires, the payment of such expenses incurred
by a director or officer in such person's capacity as a director or officer
(and not in any other capacity in which service was or is rendered by such
person while a director or officer, including, without limitation, service to
an employee benefit plan) in advance of the final disposition of a proceeding,
shall be made only upon delivery to the Corporation of an undertaking, by or on
behalf of such director or officer, to repay all amounts so advanced if it
shall ultimately be determined that such director or officer is not entitled to
be indemnified under this Section or otherwise. The Corporation may, to the
extent authorized from time to time by the Board of Directors, grant rights to
indemnification, and rights to have the Corporation pay the expenses incurred
in defending any proceeding in advance of its final disposition, to any
employee or agent of the Corporation to the fullest extent of the provisions of
this Article with respect to the indemnification and advancement of expenses of
directors and officers of the Corporation.
"(b) Right of Claimant to Bring Suit. If a claim under paragraph (a) of this
Section is not paid in full by the Corporation within 30 calendar days after a
written claim has been received by the Corporation, the claimant may at any
time thereafter bring suit against the Corporation to recover the unpaid amount
of the claim and, if successful in whole or in part, the claimant shall be
entitled to be paid also the expense of prosecuting such claim. It shall be a
defense to any such action (other than an action brought to enforce a claim for
expenses incurred in defending any proceeding in advance of its final
disposition where the required undertaking, if any is required, has been
tendered to the Corporation) that the claimant has not met the standard of
conduct which makes it permissible under the DGCL for the Corporation to
indemnify the claimant for the amount claimed, but the burden of proving such
defense shall be on the Corporation. Neither the failure of the Corporation
(including its Board of Directors, independent legal counsel, or its
stockholders) to have made a determination prior to the commencement of such
action that indemnification of the claimant is proper in the circumstances
because the claimant has met the applicable standard of conduct set forth in
the DGCL, nor an actual determination by the Corporation (including its Board
of Directors, independent legal counsel, or its stockholders) that the claimant
has not met such applicable standard of conduct, shall be a defense to the
action or create a presumption that the claimant has not met the applicable
standard of conduct.
"(c) Non-Exclusivity of Rights. The right of indemnification and the payment of
expenses incurred in defending a proceeding in advance of its final disposition
conferred in this Section shall not be exclusive of any other right which any
person may have or hereafter acquire under any statute, provision of the
Certificate of Incorporation, By-Law, agreement, vote of stockholders or
disinterested directors or otherwise. No repeal or modification of this Article
shall in any way diminish or adversely affect the rights of any director,
officer, employee or agent of the Corporation hereunder in respect of any
occurrence or matter arising prior to any such repeal or modification.
"(d) Insurance. The Corporation may maintain insurance, at its expense, to
protect itself and any director, officer, employee or agent of the Corporation
or another corporation, partnership, joint venture, trust or other enterprise
against any such expense, liability or loss, whether or not the
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<PAGE>
Corporation would have the power to indemnify such person against such expense,
liability or loss under the DGCL."
Section 145 of the Delaware General Corporation Law gives corporations the
power to indemnify officers and directors under certain circumstances.
Item 16. Exhibits.
<TABLE>
<CAPTION>
Exhibit
Number
-------
<C> <S>
1.1 -- Form of Underwriting Agreement relating to Senior Notes.
1.2 -- Form of Underwriting Agreement relating to Junior Subordinated
Notes.
1.3 -- Form of Underwriting Agreement relating to Trust Preferred
Securities.
4.1 -- Senior Indenture between Duke Capital Corporation and The Chase
Manhattan Bank, as Trustee, dated as of April 1, 1998.
4.2 -- Form of Supplemental Indenture to Senior Indenture to be used in
connection with the issuance of Senior Notes.
4.3 -- Subordinated Indenture between Duke Capital Corporation and The
Chase Manhattan Bank, as Trustee, dated as of April 1, 1998.
4.4-A -- Form of Supplemental Indenture to Subordinated Indenture to be used
in connection with the issuance of Junior Subordinated Notes.
4.4-B -- Form of Supplemental Indenture to Subordinated Indenture to be used
in connection with the issuance of Junior Subordinated Notes
relating to Trust Preferred Securities.
4.5-A -- Certificate of Trust of Duke Capital Financing Trust III.
4.5-B -- Certificate of Trust of Duke Capital Financing Trust IV.
4.5-C -- Certificate of Trust of Duke Capital Financing Trust V.
4.6-A -- Trust Agreement of Duke Capital Financing Trust III.
4.6-B -- Trust Agreement of Duke Capital Financing Trust IV.
4.6-C -- Trust Agreement of Duke Capital Financing Trust V.
4.7 -- Form of Amended and Restated Trust Agreement (Agreements for Duke
Capital Financing Trust III, Duke Capital Financing Trust IV and
Duke Capital Financing Trust V will be substantially identical
except for names and dates).
4.8 -- Form of Trust Preferred Security for Duke Capital Financing Trust
III, Duke Capital Financing Trust IV and Duke Capital Financing
Trust V (included in Exhibit 4.7 above).
4.9 -- Form of Senior Note (included in Exhibit 4.2 above).
4.10 -- Form of Junior Subordinated Note (included in Exhibits 4.4-A and
4.4-B above).
4.11 -- Form of Guarantee Agreement (Agreements for Duke Capital Financing
Trust III, Duke Capital Financing Trust IV and Duke Capital
Financing Trust V will be substantially identical except for names
and dates).
4.12 -- Form of Agreement as to Expenses and Liabilities (included in
Exhibit 4.7 above).
5.1 -- Opinion of Dewey Ballantine LLP.
5.2-A -- Opinion of Richards, Layton & Finger, P.A. relating to Duke Capital
Financing Trust III.
5.2-B -- Opinion of Richards, Layton & Finger, P.A. relating to Duke Capital
Financing Trust IV.
5.2-C -- Opinion of Richards, Layton & Finger, P.A. relating to Duke Capital
Financing Trust V.
8 -- Tax Opinion of Dewey Ballantine LLP.
12 -- Computation of ratio of earnings to fixed charges.
23.1 -- Consent of Deloitte & Touche LLP.
23.2 -- Consent of KPMG LLP.
23.3 -- Consent of Dewey Ballantine LLP (included in Exhibit 5.1 above).
23.4 -- Consent of Dewey Ballantine LLP (included in Exhibit 8 above).
23.5 -- Consent of Richards, Layton & Finger, P.A. (included in Exhibit
5.2-A, 5.2-B and 5.2-C above).
24.1 -- Power of Attorney of certain officers and directors of Duke Capital
Corporation.
</TABLE>
II-3
<PAGE>
<TABLE>
<CAPTION>
Exhibit
Number
-------
<C> <S>
24.2 -- Resolution of Duke Capital Corporation re: Power of Attorney.
25.1 -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Senior Indenture Trustee.
25.2 -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Subordinated Indenture
Trustee.
25.3-A -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Property Trustee under
Duke Capital Financing Trust III.
25.3-B -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Property Trustee under
Duke Capital Financing Trust IV.
25.3-C -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Property Trustee under
Duke Capital Financing Trust V.
25.4-A -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Guarantee Trustee with
respect to Duke Capital Financing Trust III.
25.4-B -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Guarantee Trustee with
respect to Duke Capital Financing Trust IV.
25.4-C -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Guarantee Trustee with
respect to Duke Capital Financing Trust V.
</TABLE>
Item 17. Undertakings.
(a) Undertaking related to Rule 415 offering:
The undersigned registrants hereby undertake:
(1) To file, during any period in which offers or sales are being made, a post-
effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities
Act of 1933 (the "Act");
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the registration statement;
notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
registration statement is on Form S-3, S-8 or F-3 and the information required
to be included in a post-effective amendment by those paragraphs is contained
in periodic reports filed by the registrants pursuant to Section 13 or Section
15(d) of the Securities Exchange Act of 1934 that are incorporated by reference
in the registration statement.
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<PAGE>
(2) That, for the purpose of determining any liability under the Act, each such
post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of
the securities being registered which remain unsold at the termination of the
offering.
(b) Undertaking related to filings incorporating subsequent Securities Exchange
Act of 1934 documents by reference:
The undersigned registrants hereby undertake that, for purposes of determining
any liability under the Act, each filing of Duke Capital Corporation's annual
report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange
Act of 1934 that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(c) Undertaking related to acceleration of effectiveness:
Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of each undersigned
registrant pursuant to the indemnification provisions described in Item 15
above or in contractual arrangements pursuant thereto, or otherwise, each
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by 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 controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
(d) The undersigned registrants hereby undertake that:
(1) For purposes of determining any liability under the Act, the information
omitted from the form of prospectus filed as part of this registration
statement in reliance upon Rule 430A and contained in a form of prospectus
filed by the registrants pursuant to Rule 424(b)(1) or 497(h) under the Act
shall be deemed to be part of this registration statement as of the time it was
declared effective:
(2) For the purpose of determining any liability under the Act, each post-
effective amendment that contains a form of prospectus shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant,
Duke Capital Corporation, certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly
caused this registration statement or amendment thereto to be signed on its
behalf by the undersigned, thereunto duly authorized, in Charlotte, North
Carolina, on the 27th day of January, 1999.
DUKE CAPITAL CORPORATION
By: R. B. Priory
Chairman of the Board,
President and Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this registration
statement or amendment thereto has been signed by the following directors and
officers of Duke Capital Corporation in the capacities and on the date
indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
R. B. Priory Chairman of the Board, January 27, 1999
President and Chief
Executive Officer (Principal
Executive Officer)
R. J. Osborne Vice President and January 27, 1999
Chief Financial Officer
(Principal Financial
Officer)
J. L. Boyer Controller (Principal January 27, 1999
Accounting Officer)
F. J. Fowler
R. S. Lilien A majority of the Directors January 27, 1999
R. J. Osborne
R. B. Priory
</TABLE>
Robert T. Lucas III, by signing his name hereto, does hereby sign this document
on behalf of Duke Capital Corporation and on behalf of each of the above-named
persons pursuant to a power of attorney duly executed by Duke Capital
Corporation and such persons, filed with the Securities and Exchange Commission
as an exhibit hereto.
/s/ Robert T. Lucas III
-------------------------------------
Robert T. Lucas III
Attorney-in-fact
II-6
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, Duke Capital
Financing Trust III certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused this
registration statement or amendment thereto to be signed on its behalf by the
undersigned, thereunto duly authorized, in Charlotte, North Carolina, on the
27th day of January, 1999.
DUKE CAPITAL FINANCING TRUST III
By: Duke Capital Corporation,
Depositor
/s/ Robert T. Lucas III
By: _________________________________
Robert T. Lucas III
Assistant Secretary
Pursuant to the requirements of the Securities Act of 1933, Duke Capital
Financing Trust IV certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused this
registration statement or amendment thereto to be signed on its behalf by the
undersigned, thereunto duly authorized, in Charlotte, North Carolina, on the
27th day of January, 1999.
DUKE CAPITAL FINANCING TRUST IV
By: Duke Capital Corporation,
Depositor
/s/ Robert T. Lucas III
By: _________________________________
Robert T. Lucas III
Assistant Secretary
II-7
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, Duke Capital
Financing Trust V certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused this
registration statement or amendment thereto to be signed on its behalf by the
undersigned, thereunto duly authorized, in Charlotte, North Carolina, on the
27th day of January, 1999.
DUKE CAPITAL FINANCING TRUST V
By: Duke Capital Corporation,
Depositor
/s/ Robert T. Lucas III
By: _________________________________
Robert T. Lucas III
Assistant Secretary
II-8
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Exhibit
------- -------
<C> <S>
1.1 -- Form of Underwriting Agreement relating to Senior Notes.
1.2 -- Form of Underwriting Agreement relating to Junior Subordinated
Notes.
1.3 -- Form of Underwriting Agreement relating to Trust Preferred
Securities.
4.1 -- Senior Indenture between Duke Capital Corporation and The Chase
Manhattan Bank, as Trustee, dated as of April 1, 1998.
4.2 -- Form of Supplemental Indenture to Senior Indenture to be used in
connection with the issuance of Senior Notes.
4.3 -- Subordinated Indenture between Duke Capital Corporation and The
Chase Manhattan Bank, as Trustee, dated as of April 1, 1998.
4.4-A -- Form of Supplemental Indenture to Subordinated Indenture to be used
in connection with the issuance of Junior Subordinated Notes.
4.4-B -- Form of Supplemental Indenture to Subordinated Indenture to be used
in connection with the issuance of Junior Subordinated Notes
relating to Trust Preferred Securities.
4.5-A -- Certificate of Trust of Duke Capital Financing Trust III.
4.5-B -- Certificate of Trust of Duke Capital Financing Trust IV.
4.5-C -- Certificate of Trust of Duke Capital Financing Trust V.
4.6-A -- Trust Agreement of Duke Capital Financing Trust III.
4.6-B -- Trust Agreement of Duke Capital Financing Trust IV.
4.6-C -- Trust Agreement of Duke Capital Financing Trust V.
4.7 -- Form of Amended and Restated Trust Agreement (Agreements for Duke
Capital Financing Trust III, Duke Capital Financing Trust IV and
Duke Capital Financing Trust V will be substantially identical
except for names and dates).
4.8 -- Form of Trust Preferred Security for Duke Capital Financing Trust
III, Duke Capital Financing Trust IV and Duke Capital Financing
Trust V (included in Exhibit 4.7 above).
4.9 -- Form of Senior Note (included in Exhibit 4.2 above).
4.10 -- Form of Junior Subordinated Note (included in Exhibits 4.4-A and
4.4-B above).
4.11 -- Form of Guarantee Agreement (Agreements for Duke Capital Financing
Trust III, Duke Capital Financing Trust IV and Duke Capital
Financing Trust V will be substantially identical except for names
and dates).
4.12 -- Form of Agreement as to Expenses and Liabilities (included in
Exhibit 4.7 above).
5.1 -- Opinion of Dewey Ballantine LLP.
5.2-A -- Opinion of Richards, Layton & Finger, P.A. relating to Duke Capital
Financing Trust III.
5.2-B -- Opinion of Richards, Layton & Finger, P.A. relating to Duke Capital
Financing Trust IV.
5.2-C -- Opinion of Richards, Layton & Finger, P.A. relating to Duke Capital
Financing Trust V.
8 -- Tax Opinion of Dewey Ballantine LLP.
12 -- Computation of ratio of earnings to fixed charges.
23.1 -- Consent of Deloitte & Touche LLP.
23.2 -- Consent of KPMG LLP.
23.3 -- Consent of Dewey Ballantine LLP (included in Exhibit 5.1 above).
23.4 -- Consent of Dewey Ballantine LLP (included in Exhibit 8 above).
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Exhibit
Number Exhibit
------- -------
<C> <S>
23.5 -- Consent of Richards, Layton & Finger, P.A. (included in Exhibit
5.2-A, 5.2-B and 5.2-C above).
24.1 -- Power of Attorney of certain officers and directors of Duke Capital
Corporation.
24.2 -- Resolution of Duke Capital Corporation re: Power of Attorney.
25.1 -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Senior Indenture Trustee.
25.2 -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Subordinated Indenture
Trustee.
25.3-A -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Property Trustee under
Duke Capital Financing Trust III.
25.3-B -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Property Trustee under
Duke Capital Financing Trust IV.
25.3-C -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Property Trustee under
Duke Capital Financing Trust V.
25.4-A -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Guarantee Trustee with
respect to Duke Capital Financing Trust III.
25.4-B -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Guarantee Trustee with
respect to Duke Capital Financing Trust IV.
25.4-C -- Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of The Chase Manhattan Bank, as Guarantee Trustee with
respect to Duke Capital Financing Trust V.
</TABLE>
<PAGE>
EXHIBIT 1.1
DUKE CAPITAL CORPORATION
$
SERIES % SENIOR NOTES DUE
UNDERWRITING AGREEMENT
,
Gentlemen:
1. Introductory. DUKE CAPITAL CORPORATION, a Delaware corporation
("Corporation"), proposes to issue and sell $ aggregate principal
amount of Series % Senior Notes Due ("Notes"), to be issued pursuant to
the provisions of a Senior Indenture, dated as of April 1, 1998, between the
Corporation and The Chase Manhattan Bank, as amended and supplemented to the
date hereof and as to be supplemented by a supplemental indenture, dated as of
, , relating to the Notes (the "Indenture"), and hereby
agrees with the several Underwriters hereinafter named ("Underwriters") as
follows:
2. Representations and Warranties of the Corporation. The Corporation
represents and warrants to, and agrees with, the several Underwriters that:
(a) A registration statement (No. ), including a prospectus, relating
to the Notes has been filed with the Securities and Exchange Commission
("Commission") under the Securities Act of 1933 (the "1933 Act"). Such
registration statement and any post-effective amendment thereto, each in the
form heretofore delivered to you, have been declared effective by the
Commission in such form, and no stop order suspending the effectiveness of such
registration statement has been issued and no proceeding for that purpose has
been initiated or threatened by the Commission (any preliminary prospectus
included in such registration statement or filed with the Commission pursuant
to Rule 424(a) of the rules and regulations of the Commission under the 1933
Act being hereinafter called a "Preliminary Prospectus"; the various parts of
such registration statement, including all exhibits thereto and including the
documents incorporated by reference in the prospectus contained in the
registration statement at the time such part of the registration statement
became effective, each as amended at the time such part of the registration
statement became effective, being hereinafter called the "Registration
Statement"; and the final prospectus relating to the Notes, in the form first
filed pursuant to Rule 424(b) under the 1933 Act, being hereinafter called the
"Prospectus"; and any reference herein to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents incorporated
by reference therein, as of the date of such Preliminary
<PAGE>
Prospectus or Prospectus, as the case may be; any reference to any amendment or
supplement to any Preliminary Prospectus or Prospectus shall be deemed to refer
to and include any documents filed after the date of such Preliminary
Prospectus or Prospectus, as the case may be, under the Securities Exchange Act
of 1934, as amended (the "1934 Act"), and incorporated by reference in such
Preliminary Prospectus or Prospectus, as the case may be; and any reference to
any amendment to the Registration Statement shall be deemed to refer to and
include any annual report of the Corporation filed pursuant to Section 13(a) or
15(d) of the 1934 Act after the effective date of the Registration Statement
that is incorporated by reference in the Registration Statement).
(b) The Registration Statement conforms and the Prospectus will conform in all
material respects to the requirements of the 1933 Act and the rules and
regulations thereunder ("1933 Act Regulations"), and the Registration Statement
does not and the Prospectus will not include any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, except that the
foregoing does not apply to statements or omissions in any such document based
upon written information furnished to the Corporation by any Underwriter
specifically for use therein.
(c) The documents incorporated by reference in the Prospectus, at the time they
were filed with the Commission, conformed in all material respects to the
requirements of the 1934 Act and the rules and regulations of the Commission
thereunder (the "1934 Act Regulations"), and, when read together with the other
information in the Prospectus, do not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and any documents
deemed to be incorporated by reference in the Prospectus will, when they are
filed with the Commission, comply in all material respects with the
requirements of the 1934 Act and the 1934 Act Regulations, and will not contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they are made, not misleading.
(d) The compliance by the Corporation with all of the provisions of this
Agreement and the consummation of the transactions herein contemplated will not
conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Corporation
or any of its Principal Subsidiaries is a party or by which any of them or
their respective property is bound or to which any of their property or assets
is subject, nor will such action result in any violation of the provisions of
the Restated Certificate of Incorporation or By-Laws of the Corporation or any
statute or any order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Corporation or its Principal Subsidiaries or
any of their respective property; and no consent, approval, authorization,
order, registration or qualification of or with any such court or governmental
agency or body is required for the consummation by the Corporation of the
transactions contemplated by this Agreement, except for the registration under
the 1933 Act of the Notes and such consents, approvals, authorizations,
registrations or qualifications as may be required under state securities or
Blue Sky laws in connection with the purchase and distribution of the Notes by
the Underwriters.
(e) Each of PanEnergy Corp, Panhandle Eastern Pipe Line Company, Texas Eastern
Transmission Corporation, Trunkline Gas Company and Algonquin Gas Transmission
Company, each a Delaware corporation (and hereinafter called a "Principal
Subsidiary"), is a direct or indirect wholly-owned subsidiary of the
Corporation.
2
<PAGE>
3. Purchase, Sale and Delivery of Notes. On the basis of the representations,
warranties and agreements herein contained, but subject to the terms and
conditions herein set forth, the Corporation agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to
purchase from the Corporation, at a purchase price of % of the principal
amount of the Notes, plus accrued interest from , , the respective
principal amount of Notes set forth opposite the names of the Underwriters in
Schedule A hereto plus the respective principal amount of additional Notes
which each such Underwriter may become obligated to purchase pursuant to the
provisions of Section 8 hereof.
Payment of the purchase price for the Notes to be purchased by the Underwriters
shall be made at the offices of Dewey Ballantine LLP, 1301 Avenue of the
Americas, New York, N.Y., or at such other place as shall be mutually agreed
upon by you and the Corporation, at 10:00 A.M., New York City time, on ,
(unless postponed in accordance with the provisions of Section 8) or
such other time not later than three full business days after such date as shall
be agreed upon by you and the Corporation (the "Closing Date"). Payment shall be
made to the Corporation by wire transfer in immediately available funds, payable
to the order of the Corporation against delivery of the Notes, in fully
registered form, to you or upon your order. The Notes shall be delivered in the
form of one or more global certificates in aggregate denomination equal to the
aggregate principal amount of the Notes upon original issuance and registered in
the name of Cede & Co., as nominee for The Depository Trust Company ("DTC").
4. Offering by the Underwriters. It is understood that the several Underwriters
propose to offer the Notes for sale to the public as set forth in the
Prospectus.
5. Covenants of the Corporation. The Corporation covenants and agrees with the
several Underwriters that:
(a) The Corporation will advise you promptly of any amendment or
supplementation of the Registration Statement or the Prospectus and of the
institution by the Commission of any stop order proceedings in respect of the
Registration Statement, and will use its best efforts to prevent the issuance
of any such stop order and to obtain as soon as possible its lifting, if
issued.
(b) If at any time when a prospectus relating to the Notes is required to be
delivered under the 1933 Act any event occurs as a result of which the
Prospectus as then amended or supplemented would include an untrue statement of
a material fact, or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary at any time to amend the Prospectus
to comply with the 1933 Act, the Corporation promptly will prepare and file
with the Commission an amendment, supplement or an appropriate document
pursuant to Section 13 or 14 of the 1934 Act which will correct such statement
or omission or which will effect such compliance.
(c) The Corporation, during the period when a prospectus relating to the Notes
is required to be delivered under the 1933 Act, will file promptly all
documents required to be filed with the Commission pursuant to Section 13 or 14
of the 1934 Act.
(d) The Corporation will make generally available to its security holders, in
each case as soon as practicable but not later than 60 days after the close of
the period covered thereby, earnings statements
3
<PAGE>
(in form complying with the provisions of Section 11(a) of the 1933 Act, which
need not be certified by independent certified public accountants unless
required by the 1933 Act) covering (i) a twelve-month period beginning not
later than the first day of the Corporation's fiscal quarter next following the
effective date of the Registration Statement and (ii) a twelve-month period
beginning not later than the first day of the Corporation's fiscal quarter next
following the date of this Agreement.
(e) The Corporation will furnish to you, without charge, copies of the
Registration Statement ( of which will be signed and will include all exhibits
other than those incorporated by reference), the Prospectus, and all amendments
and supplements to such documents, in each case as soon as available and in
such quantities as you reasonably request.
(f) The Corporation will arrange or cooperate in arrangements for the
qualification of the Notes for sale under the laws of such jurisdictions as you
designate and will continue such qualifications in effect so long as required
for the distribution; provided, however, that the Corporation shall not be
required to qualify as a foreign corporation or to file any general consents to
service of process under the laws of any state where it is not now so subject.
(g) The Corporation will not, during the period beginning from the date hereof
and continuing to and including the date fifteen days after the date hereof,
sell, offer to sell, grant any option for the sale of, or otherwise dispose of
any Notes, any security convertible into or exchangeable for the Notes or any
debt security substantially similar to the Notes (except for the Notes issued
pursuant to this Agreement), without your prior written consent.
(h) The Corporation will pay all expenses incident to the performance of its
obligations under this Agreement including (i) the printing and filing of the
Registration Statement and the printing of this Agreement and the Blue Sky
Survey, (ii) the issuance and delivery of the Notes as specified herein, (iii)
the fees and disbursements of counsel for the Underwriters in connection with
the qualification of the Notes under the securities laws of any jurisdiction in
accordance with the provisions of Section 5(f) and in connection with the
preparation of the Blue Sky Survey, such fees not to exceed $7,500, (iv) the
printing and delivery to the Underwriters, in quantities as hereinabove
referred to, of copies of the Registration Statement and Prospectus and any
amendments thereto, and of the Prospectus and any amendments or supplements
thereto, (v) any fees charged by independent rating agencies for rating the
Notes, (vi) any fees and expenses in connection with any listing of the Notes
on the New York Stock Exchange, (vii) any filing fee required by the National
Association of Securities Dealers, Inc., and (viii) the costs of any depository
arrangements for the Notes with DTC or any successor depository.
6. Conditions of the Obligations of the Underwriters. The obligations of the
several Underwriters to purchase and pay for the Notes will be subject to the
accuracy of the representations and warranties on the part of the Corporation
herein, to the accuracy of the statements of officers of the Corporation made
pursuant to the provisions hereof, to the performance by the Corporation of its
obligations hereunder and to the following additional conditions precedent:
(a) Prior to the Closing Date, no stop order suspending the effectiveness of
the Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or, to the knowledge of the Corporation or
you, shall be threatened by the Commission.
(b) Prior to the Closing Date, the rating assigned by Moody's Investors
Service, Inc. or Standard & Poor's Ratings Group to (i) any preferred
securities or any debt securities of the Corporation or (ii)
4
<PAGE>
any trust preferred securities of Duke Capital Financing Trust I or Duke
Capital Financing Trust II as of the date of this Agreement shall not have been
lowered.
(c) Since the respective most recent dates as of which information is given in
the Prospectus and up to the Closing Date, there shall not have been any
material adverse change in the condition of the Corporation, financial or
otherwise, except as reflected in or contemplated by the Prospectus, and, since
such dates and up to the Closing Date, there shall not have been any material
transaction entered into by the Corporation other than transactions
contemplated by the Prospectus and transactions in the ordinary course of
business.
(d) You shall have received an opinion or opinions of Dewey Ballantine LLP,
counsel to the Corporation, dated the Closing Date, to the effect that:
(i) The Corporation has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with
power and authority (corporate and other) to own its properties and conduct its
business as described in the Prospectus.
(ii) Each of the Principal Subsidiaries has been duly incorporated and is
validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, with power and authority (corporate and other)
to own its properties and conduct its business as described in the Prospectus.
(iii) The Indenture has been duly authorized, executed and delivered by the
Corporation and duly qualified under the Trust Indenture Act of 1939 and,
assuming the due authorization, execution and delivery thereof by The Chase
Manhattan Bank, as Trustee, constitutes a valid and legally binding instrument
of the Corporation, enforceable against the Corporation in accordance with its
terms, subject to the qualifications that the enforceability of the
Corporation's obligations under the Indenture may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, and by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
(iv) The Notes have been duly authorized and executed by the Corporation and,
when authenticated by The Chase Manhattan Bank, as Trustee, in the manner
provided in the Indenture and delivered against payment therefor, will
constitute valid and legally binding obligations of the Corporation,
enforceable against the Corporation in accordance with their terms, subject to
the qualifications that the enforceability of the Corporation's obligations
under the Notes may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law), and are
entitled to the benefits afforded by the Indenture in accordance with the terms
of the Indenture and the Notes.
(v) The Registration Statement has become effective under the 1933 Act, and, to
the best of the knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
for that purpose have been instituted or are pending or threatened under the
1933 Act.
(vi) This Agreement has been duly authorized, executed and delivered by the
Corporation.
(vii) The performance by the Corporation of this Agreement will not contravene
any of the provisions of the Restated Certificate of Incorporation or By-Laws
of the Corporation.
5
<PAGE>
(viii) The Corporation is not a holding company under the Public Utility
Holding Company Act of 1935, as amended.
(ix) No consent, approval, authorization, order, registration or qualification
of or with any court or governmental agency or body is required for the issue
and sale of the Notes or the consummation by the Corporation of the
transactions contemplated by this Agreement or the Indenture, except such as
have been obtained under the 1933 Act and the Trust Indenture Act and such
consents, approvals, authorizations, orders, registrations or qualifications as
may be required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Notes by the Underwriters.
(x) The Registration Statement as of the date of effectiveness under the 1933
Act and the Prospectus as of the date it was filed with, or transmitted for
filing to, the Commission complied as to form in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations; and nothing has come
to their attention that would lead them to believe that the Registration
Statement as of the date of effectiveness under the 1933 Act (or if an
amendment to such Registration Statement or an annual report on Form 10-K has
been filed by the Corporation with the Commission subsequent to the
effectiveness of the Registration Statement, then at the time of the most
recent such filing) contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus as of the date it was
filed with, or transmitted for filing to, the Commission and at the Closing
Date contained or contains an untrue statement of a material fact or omitted or
omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. Such opinion may state that such counsel do not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement and Prospectus except as otherwise
expressly provided in such opinion and do not express any opinion or belief as
to the financial statements or other financial data contained in the
Registration Statement and the Prospectus or as to the statement of the
eligibility and qualification of the Trustee.
(xi) The statements made in the Prospectus under the captions "Description of
the Senior Notes" and "Description of the Series Senior Notes," insofar as
they purport to summarize provisions of documents specifically referred to
therein, fairly present the information called for with respect thereto by Form
S-3.
In rendering the foregoing opinion or opinions, Dewey Ballantine LLP may state
that such opinion or opinions are limited to the federal laws of the United
States, the laws of the State of New York and the General Corporation Law of
the State of Delaware, and that they are expressing no opinion as to the effect
of the laws of any other jurisdiction. In addition, such counsel may state that
they have relied as to certain factual matters on information obtained from
public officials, officers of the Corporation and other sources believed by
them to be responsible and that the signatures on all documents examined by
them are genuine, assumptions which such counsel have not independently
verified.
(e) You shall have received an opinion, dated the Closing Date, of Ellen T.
Ruff, Esq., General Counsel of the Corporation, to the effect that:
(i) Each of the Corporation and the Principal Subsidiaries is duly qualified to
do business in each jurisdiction in which the ownership or leasing of its
property or the conduct of its business requires
6
<PAGE>
such qualification, except where the failure to so qualify, considering all
such cases in the aggregate, does not have a material adverse effect on the
business, properties, financial position or results of operations of the
Corporation and its subsidiaries taken as a whole.
(ii) The descriptions in the Registration Statement and the Prospectus of legal
or governmental proceedings are accurate and fairly present the information
required to be shown, and such counsel does not know of any litigation or any
legal or governmental proceeding instituted or threatened against the
Corporation or any of its subsidiaries or any of their respective properties
that would be required to be disclosed in the Prospectus and is not so
disclosed.
Such counsel shall also state that nothing has come to her attention that has
caused her to believe that the Registration Statement as of the date of
effectiveness under the 1933 Act and the Prospectus as of the date it was filed
with, or transmitted for filing to, the Commission, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
that the Prospectus as of the date it was filed with, or transmitted for filing
to, the Commission and at the Closing Date, contained or contains any untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. Such counsel may also
state that, except as otherwise expressly provided in such opinion, she does
not assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement and the Prospectus and does
not express any opinion or belief as to the financial statements or other
financial data contained in the Registration Statement and the Prospectus.
In rendering the foregoing opinion, such counsel may rely, to the extent
recited therein, upon opinions of local counsel. Such counsel may also state
that he has relied as to certain factual matters on information obtained from
public officials, officers of the Corporation and other sources believed by him
to be responsible.
(f) You shall have received the opinion or opinions of Sullivan & Cromwell,
counsel for the Underwriters, dated the Closing Date, with respect to the
incorporation of the Corporation, the validity of the Notes, the Registration
Statement and the Prospectus, as amended or supplemented, and such other
related matters as you may require, and the Corporation shall have furnished to
such counsel such documents as they request for the purpose of enabling them to
pass upon such matters.
(g) On or after the date hereof, there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally or of the securities of Duke Energy Corporation, the Corporation,
Duke Capital Financing Trust I or Duke Capital Financing Trust II on the New
York Stock Exchange; or (ii) a general moratorium on commercial banking
activities in New York declared by either federal or New York State
authorities; or (iii) the outbreak or material escalation of hostilities
involving the United States or the declaration by the United States of a
national emergency or war if the effect of any such event specified in this
clause (g) in your judgment makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the Notes being delivered at the
Closing Date on the terms and in the manner contemplated in the Prospectus. In
such event there shall be no liability on the part of any party to any other
party except as otherwise provided in Section 7 hereof and except for the
expenses to be borne by the Corporation as provided in Section 5(h) hereof.
7
<PAGE>
(h) You shall have received a certificate of the Chairman of the Board and
President or any Vice President and a principal financial or accounting officer
of the Corporation, dated the Closing Date, in which such officers, to the best
of their knowledge after reasonable investigation, shall state that the
representations and warranties of the Corporation in this Agreement are true
and correct, that the Corporation has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at or prior
to the Closing Date, that the conditions specified in Section 6(b) and Section
6(c) have been satisfied, and that no stop order suspending the effectiveness
of the Registration Statement has been issued and no proceedings for that
purpose have been instituted or are threatened by the Commission.
(i) On the date of this Agreement, you shall have received letters dated the
date hereof, in form and substance satisfactory to you, from the Corporation's
independent public accountants, containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in or incorporated by reference into the Prospectus.
(j) At the Closing Date you shall have received from the Corporation's
independent public accountants letters, dated the Closing Date, to the effect
that such accountants reaffirm the statements made in the letters furnished
pursuant to paragraph (i) of this Section 6, except that the specified date
referred to shall be a date not more than three business days prior to the
Closing Date.
The Corporation will furnish you with such conformed copies of such opinions,
certificates, letters and documents as you reasonably request.
7. Indemnification. (a) The Corporation agrees to indemnify and hold harmless
each Underwriter and each person, if any, who controls any Underwriter within
the meaning of Section 15 of the 1933 Act, as follows:
(i) 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 the Registration Statement (or any amendment thereto), 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 Preliminary Prospectus, the prospectus constituting a part of
the Registration Statement in the form in which it became effective or the
Prospectus (or any amendment or supplement thereto) 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, unless such statement or omission or such alleged statement or
omission was made in reliance upon and in conformity with written information
furnished to the Corporation by any Underwriter through you expressly for use
in the Registration Statement (or any amendment thereto) or such Preliminary
Prospectus, such prospectus, or the Prospectus (or any amendment or supplement
thereto);
(ii) against any and all loss, liability, claim, damage and expense whatsoever
to the extent of the aggregate amount paid in settlement of any litigation,
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 written consent of the Corporation; and
8
<PAGE>
(iii) against any and all expense whatsoever reasonably incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the extent that
any such expense is not paid under (i) or (ii) above.
In no case shall the Corporation be liable under this indemnity agreement with
respect to any claim made against any Underwriter or any such controlling
person unless the Corporation shall be notified in writing of the nature of the
claim within a reasonable time after the assertion thereof, but failure so to
notify the Corporation shall not relieve it from any liability which it may
have otherwise than on account of this indemnity agreement. The Corporation
shall be entitled to participate at its own expense in the defense, or, if it
so elects, within a reasonable time after receipt of such notice, to assume the
defense of any suit brought to enforce any such claim, but if it so elects to
assume the defense, such defense shall be conducted by counsel chosen by it and
approved by the Underwriter or Underwriters or controlling person or persons,
or defendant or defendants in any suit so brought, which approval shall not be
unreasonably withheld. In any such suit, any Underwriter or any such
controlling person shall have the right to employ its own counsel, but the fees
and expenses of such counsel shall be at the expense of such Underwriter or
such controlling person unless (i) the Corporation and such Underwriter shall
have mutually agreed to the employment of such counsel, or (ii) the named
parties to any such action (including any impleaded parties) include both such
Underwriter or such controlling person and the Corporation and such Underwriter
or such controlling person shall have been advised by such counsel that a
conflict of interest between the Corporation and such Underwriter or such
controlling person may arise and for this reason it is not desirable for the
same counsel to represent both the indemnifying party and also the indemnified
party (it being understood, however, that the Corporation shall not, in
connection with any one such action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys for all such Underwriters and all such
controlling persons, which firm shall be designated in writing by you). The
Corporation agrees to notify you within a reasonable time of the assertion of
any claim against it, any of its officers or directors or any person who
controls the Corporation within the meaning of Section 15 of the 1933 Act, in
connection with the sale of the Notes.
(b) Each Underwriter severally agrees that it will indemnify and hold harmless
the Corporation, its directors and each of the officers of the Corporation who
signed the Registration Statement and each person, if any, who controls the
Corporation within the meaning of Section 15 of the 1933 Act to the same extent
as the indemnity contained in subsection (a) of this Section, but only with
respect to statements or omissions made in the Registration Statement (or any
amendment thereto) or any Preliminary Prospectus, such prospectus or the
Prospectus (or any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Corporation by such
Underwriter through you expressly for use in the Registration Statement (or any
amendment thereto), such Preliminary Prospectus, such prospectus or the
Prospectus (or any amendment or supplement thereto). In case any action shall
be brought against the Corporation or any person so indemnified based on the
Registration Statement (or any amendment thereto) or such Preliminary
Prospectus, such prospectus or the Prospectus (or any amendment or supplement
thereto) and in respect of which indemnity may be sought against any
Underwriter, such Underwriter shall have the rights and duties
9
<PAGE>
given to the Corporation, and the Corporation and each person so indemnified
shall have the rights and duties given to the Underwriters, by the provisions
of subsection (a) of this Section.
8. Default by One or More of the Underwriters. (a) If any Underwriter shall
default in its obligation to purchase the Notes which it has agreed to purchase
hereunder on the Closing Date, you may in your discretion arrange for you or
another party or other parties to purchase such Notes on the terms contained
herein. If within thirty-six hours after such default by any Underwriter you do
not arrange for the purchase of such Notes, then the Corporation shall be
entitled to a further period of thirty-six hours within which to procure
another party or other parties satisfactory to you to purchase such Notes on
such terms. In the event that, within the respective prescribed periods, you
notify the Corporation that you have so arranged for the purchase of such
Notes, or the Corporation notifies you that it has so arranged for the purchase
of such Notes, you or the Corporation shall have the right to postpone such
Closing Date for a period of not more than seven days, in order to effect
whatever changes may thereby be made necessary in the Registration Statement or
the Prospectus, or in any other documents or arrangements, and the Corporation
agrees to file promptly any amendments to the Registration Statement or the
Prospectus which may be required. The term "Underwriter" as used in this
Agreement shall include any person substituted under this Section with like
effect as if such person had originally been a party to this Agreement with
respect to such Notes.
(b) If, after giving effect to any arrangements for the purchase of the Notes
of a defaulting Underwriter or Underwriters by you or the Corporation as
provided in subsection (a) above, the aggregate amount of such Notes which
remains unpurchased does not exceed one-eleventh of the aggregate amount of all
the Notes to be purchased at such Closing Date, then the Corporation shall have
the right to require each non-defaulting Underwriter to purchase the amount of
Notes which such Underwriter agreed to purchase hereunder at such Closing Date
and, in addition, to require each non-defaulting Underwriter to purchase its
pro rata share (based on the amount of Notes which such Underwriter agreed to
purchase hereunder) of the Notes of such defaulting Underwriter or Underwriters
for which such arrangements have not been made; but nothing herein shall
relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the Notes
of a defaulting Underwriter or Underwriters by you or the Corporation as
provided in subsection (a) above, the aggregate amount of such Notes which
remains unpurchased exceeds one-eleventh of the aggregate amount of all the
Notes to be purchased at such Closing Date, or if the Corporation shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Notes of a defaulting Underwriter or Underwriters,
then this Agreement shall thereupon terminate, without liability on the part of
any non-defaulting Underwriter or the Corporation, except for the expenses to
be borne by the Corporation as provided in Section 5(h) hereof and the
indemnity agreement in Section 7 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
9. Representations and Indemnities to Survive Delivery. The respective
indemnities, agreements, representations, warranties and other statements of
the Corporation or its officers and of the several Underwriters set forth in or
made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation, or statement as to the results thereof, made
by or on behalf of any
10
<PAGE>
Underwriter or the Corporation, or any of its officers or directors or any
controlling person, and will survive delivery of and payment for the Notes.
10. Notices. All communications hereunder will be in writing and, if sent to
the Underwriters, will be mailed, delivered or telecopied and confirmed to you
in care of at , attention of
or, if sent to the Corporation, will be mailed,
delivered or telecopied and confirmed to it at 422 South Church Street,
Charlotte, N.C. 28202, telephone number (704) 382-5159, attention of Richard J.
Osborne, Vice President and Chief Financial Officer; provided, however, that any
notice to an Underwriter pursuant to Section 7 hereof shall be delivered or sent
by mail or telecopy to such Underwriter at its address or telecopy number set
forth in its Underwriters' Questionnaire or telex constituting such
Questionnaire, which address or telecopy number will be supplied to the
Corporation by you. Any such communications shall take effect upon receipt
thereof.
11. Business Day. As used herein, the term "business day" shall mean any day
when the Commission's office in Washington, D.C. is open for business.
12. Successors. This Agreement shall inure to the benefit of and be binding
upon the Underwriters and the Corporation and their respective successors.
Nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any person, firm or corporation, other than the parties
hereto and their respective successors and the controlling persons and the
officers and directors referred to in Section 7, and their respective
successors, heirs and legal representatives any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision herein
contained; this Agreement and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of the parties
hereto and their respective successors and said controlling persons, officers
and directors and their respective successors, heirs and legal representatives,
and for the benefit of no other person, firm or corporation. No purchaser of
Notes from any Underwriter shall be deemed to be a successor or assign by
reason merely of such purchase.
13. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original, but all of which together
shall constitute one and the same instrument.
14. Applicable Law. This Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of New York.
11
<PAGE>
If the foregoing is in accordance with your understanding, kindly sign and
return to us two counterparts hereof, and upon your acceptance, this letter and
such acceptance will become a binding agreement between the Corporation, on the
one hand, and each of the Underwriters, on the other hand, in accordance with
its terms.
Very truly yours,
Duke Capital Corporation
By:_______________________
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
By:__________________________
12
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF
NOTES TO BE
UNDERWRITER PURCHASED
----------- -----------
<S> <C>
$
-----------
Total........................................................... $
===========
</TABLE>
13
<PAGE>
EXHIBIT 1.2
DUKE CAPITAL CORPORATION
$
SERIES % JUNIOR SUBORDINATED NOTES DUE
UNDERWRITING AGREEMENT
Gentlemen:
1. Introductory. DUKE CAPITAL CORPORATION, a Delaware corporation
("Corporation"), proposes to issue and sell $ aggregate principal
amount of Series % Junior Subordinated Notes Due ("Notes"), to be issued
pursuant to the provisions of a Senior Indenture, dated as of April 1, 1998,
between the Corporation and The Chase Manhattan Bank, as amended and
supplemented to the date hereof and as to be supplemented by a supplemental
indenture, dated as of , , relating to the Notes (the "Indenture"),
and hereby agrees with the several Underwriters hereinafter named
("Underwriters") as follows:
2. Representations and Warranties of the Corporation. The Corporation
represents and warrants to, and agrees with, the several Underwriters that:
(a) A registration statement (No. ), including a prospectus,
relating to the Notes has been filed with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933 (the "1933
Act"). Such registration statement and any post-effective amendment
thereto, each in the form heretofore delivered to you, have been declared
effective by the Commission in such form, and no stop order suspending the
effectiveness of such registration statement has been issued and no
proceeding for that purpose has been initiated or threatened by the
Commission (any preliminary prospectus included in such registration
statement or filed with the Commission pursuant to Rule 424(a) of the rules
and regulations of the Commission under the 1933 Act being hereinafter
called a "Preliminary Prospectus"; the various parts of such registration
statement, including all exhibits thereto and including the documents
incorporated by reference in the prospectus contained in the registration
statement at the time such part of the registration statement became
effective, each as amended at the time such part of the registration
statement became effective, being hereinafter called the "Registration
Statement"; and the final prospectus relating to the Notes, in the form
first filed pursuant to Rule 424(b) under the 1933 Act, being hereinafter
called the "Prospectus"; and any reference herein to any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and
<PAGE>
include the documents incorporated by reference therein, as of the date of
such Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment or supplement to any Preliminary Prospectus or
Prospectus shall be deemed to refer to and include any documents filed
after the date of such Preliminary Prospectus or Prospectus, as the case
may be, under the Securities Exchange Act of 1934, as amended (the "1934
Act"), and incorporated by reference in such Preliminary Prospectus or
Prospectus, as the case may be; and any reference to any amendment to the
Registration Statement shall be deemed to refer to and include any annual
report of the Corporation filed pursuant to Section 13(a) or 15(d) of the
1934 Act after the effective date of the Registration Statement that is
incorporated by reference in the Registration Statement).
(b) The Registration Statement conforms and the Prospectus will conform in
all material respects to the requirements of the 1933 Act and the rules and
regulations thereunder ("1933 Act Regulations"), and the Registration
Statement does not and the Prospectus will not include any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, except
that the foregoing does not apply to statements or omissions in any such
document based upon written information furnished to the Corporation by any
Underwriter specifically for use therein.
(c) The documents incorporated by reference in the Prospectus, at the time
they were filed with the Commission, conformed in all material respects to
the requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations"), and, when read together
with the other information in the Prospectus, do not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading, and any documents deemed to be incorporated by reference in the
Prospectus will, when they are filed with the Commission, comply in all
material respects with the requirements of the 1934 Act and the 1934 Act
Regulations, and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which
they are made, not misleading.
(d) The compliance by the Corporation with all of the provisions of this
Agreement and the consummation of the transactions herein contemplated will
not conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument to which the
Corporation or any of its Principal Subsidiaries is a party or by which any
of them or their respective property is bound or to which any of their
property or assets is subject, nor will such action result in any violation
of the provisions of the Restated Certificate of Incorporation or By-Laws
of the Corporation or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the
Corporation or its Principal Subsidiaries or any of their respective
property; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the consummation by the Corporation of the transactions
contemplated by this Agreement, except for the registration under the 1933
Act of the Notes and such consents, approvals, authorizations,
registrations or qualifications as may be required under state securities
or Blue Sky laws in connection with the purchase and distribution of the
Notes by the Underwriters.
2
<PAGE>
(e) Each of PanEnergy Corp, Panhandle Eastern Pipe Line Company, Texas
Eastern Transmission Corporation, Trunkline Gas Company and Algonquin Gas
Transmission Company, each a Delaware corporation (and hereinafter called a
"Principal Subsidiary"), is a direct or indirect wholly-owned subsidiary of
the Corporation.
3. Purchase, Sale and Delivery of Notes. On the basis of the representations,
warranties and agreements herein contained, but subject to the terms and
conditions herein set forth, the Corporation agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to
purchase from the Corporation, at a purchase price of % of the principal
amount of the Notes, plus accrued interest from , , the respective
principal amount of Notes set forth opposite the names of the Underwriters in
Schedule A hereto plus the respective principal amount of additional Notes
which each such Underwriter may become obligated to purchase pursuant to the
provisions of Section 8 hereof.
Payment of the purchase price for the Notes to be purchased by the Underwriters
shall be made at the offices of Dewey Ballantine LLP, 1301 Avenue of the
Americas, New York, N.Y., or at such other place as shall be mutually agreed
upon by you and the Corporation, at 10:00 A.M., New York City time, on ,
(unless postponed in accordance with the provisions of Section 8) or
such other time not later than three full business days after such date as shall
be agreed upon by you and the Corporation (the "Closing Date"). Payment shall be
made to the Corporation by wire transfer in immediately available funds, payable
to the order of the Corporation against delivery of the Notes, in fully
registered form, to you or upon your order. The Notes shall be delivered in the
form of one or more global certificates in aggregate denomination equal to the
aggregate principal amount of the Notes upon original issuance and registered in
the name of Cede & Co., as nominee for The Depository Trust Company ("DTC").
4. Offering by the Underwriters. It is understood that the several Underwriters
propose to offer the Notes for sale to the public as set forth in the
Prospectus.
5. Covenants of the Corporation. The Corporation covenants and agrees with the
several Underwriters that:
(a) The Corporation will advise you promptly of any amendment or
supplementation of the Registration Statement or the Prospectus and of the
institution by the Commission of any stop order proceedings in respect of
the Registration Statement, and will use its best efforts to prevent the
issuance of any such stop order and to obtain as soon as possible its
lifting, if issued.
(b) If at any time when a prospectus relating to the Notes is required to
be delivered under the 1933 Act any event occurs as a result of which the
Prospectus as then amended or supplemented would include an untrue
statement of a material fact, or omit to state any material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary at any time to
amend the Prospectus to comply with the 1933 Act, the Corporation promptly
will prepare and file with the Commission an amendment, supplement or an
appropriate document pursuant to Section 13 or 14 of the 1934 Act which
will correct such statement or omission or which will effect such
compliance.
3
<PAGE>
(c) The Corporation, during the period when a prospectus relating to the
Notes is required to be delivered under the 1933 Act, will file promptly
all documents required to be filed with the Commission pursuant to Section
13 or 14 of the 1934 Act.
(d) The Corporation will make generally available to its security holders,
in each case as soon as practicable but not later than 60 days after the
close of the period covered thereby, earnings statements (in form complying
with the provisions of Section 11(a) of the 1933 Act, which need not be
certified by independent certified public accountants unless required by
the 1933 Act) covering (i) a twelve-month period beginning not later than
the first day of the Corporation's fiscal quarter next following the
effective date of the Registration Statement and (ii) a twelve-month period
beginning not later than the first day of the Corporation's fiscal quarter
next following the date of this Agreement.
(e) The Corporation will furnish to you, without charge, copies of the
Registration Statement ( of which will be signed and will include all
exhibits other than those incorporated by reference), the Prospectus, and
all amendments and supplements to such documents, in each case as soon as
available and in such quantities as you reasonably request.
(f) The Corporation will arrange or cooperate in arrangements for the
qualification of the Notes for sale under the laws of such jurisdictions as
you designate and will continue such qualifications in effect so long as
required for the distribution; provided, however, that the Corporation
shall not be required to qualify as a foreign corporation or to file any
general consents to service of process under the laws of any state where it
is not now so subject.
(g) The Corporation will not, during the period beginning from the date
hereof and continuing to and including the date fifteen days after the date
hereof, sell, offer to sell, grant any option for the sale of, or otherwise
dispose of any Notes, any security convertible into or exchangeable for the
Notes or any debt security substantially similar to the Notes (except for
the Notes issued pursuant to this Agreement), without your prior written
consent.
(h) The Corporation will pay all expenses incident to the performance of
its obligations under this Agreement including (i) the printing and filing
of the Registration Statement and the printing of this Agreement and the
Blue Sky Survey, (ii) the issuance and delivery of the Notes as specified
herein, (iii) the fees and disbursements of counsel for the Underwriters in
connection with the qualification of the Notes under the securities laws of
any jurisdiction in accordance with the provisions of Section 5(f) and in
connection with the preparation of the Blue Sky Survey, such fees not to
exceed $7,500, (iv) the printing and delivery to the Underwriters, in
quantities as hereinabove referred to, of copies of the Registration
Statement and Prospectus and any amendments thereto, and of the Prospectus
and any amendments or supplements thereto, (v) any fees charged by
independent rating agencies for rating the Notes, (vi) any fees and
expenses in connection with any listing of the Notes on the New York Stock
Exchange, (vii) any filing fee required by the National Association of
Securities Dealers, Inc., and (viii) the costs of any depository
arrangements for the Notes with DTC or any successor depository.
6. Conditions of the Obligations of the Underwriters. The obligations of the
several Underwriters to purchase and pay for the Notes will be subject to the
accuracy of the representations and
4
<PAGE>
warranties on the part of the Corporation herein, to the accuracy of the
statements of officers of the Corporation made pursuant to the provisions
hereof, to the performance by the Corporation of its obligations hereunder and
to the following additional conditions precedent:
(a) Prior to the Closing Date, no stop order suspending the effectiveness
of the Registration Statement shall have been issued and no proceedings for
that purpose shall have been instituted or, to the knowledge of the
Corporation or you, shall be threatened by the Commission.
(b) Prior to the Closing Date, the rating assigned by Moody's Investors
Service, Inc. or Standard & Poor's Ratings Group to (i) any preferred
securities or any debt securities of the Corporation or (ii) any trust
preferred securities of Duke Capital Financing Trust I or Duke Capital
Financing Trust II as of the date of this Agreement shall not have been
lowered.
(c) Since the respective most recent dates as of which information is given
in the Prospectus and up to the Closing Date, there shall not have been any
material adverse change in the condition of the Corporation, financial or
otherwise, except as reflected in or contemplated by the Prospectus, and,
since such dates and up to the Closing Date, there shall not have been any
material transaction entered into by the Corporation other than
transactions contemplated by the Prospectus and transactions in the
ordinary course of business.
(d) You shall have received an opinion or opinions of Dewey Ballantine LLP,
counsel to the Corporation, dated the Closing Date, to the effect that:
(i) The Corporation has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of
Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus.
(ii) Each of the Principal Subsidiaries has been duly incorporated and
is validly existing as a corporation in good standing under the laws of
its jurisdiction of incorporation, with power and authority (corporate
and other) to own its properties and conduct its business as described
in the Prospectus.
(iii) The Indenture has been duly authorized, executed and delivered by
the Corporation and duly qualified under the Trust Indenture Act of
1939 and, assuming the due authorization, execution and delivery
thereof by The Chase Manhattan Bank, as Trustee, constitutes a valid
and legally binding instrument of the Corporation, enforceable against
the Corporation in accordance with its terms, subject to the
qualifications that the enforceability of the Corporation's obligations
under the Indenture may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, and by general principles of
equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law).
(iv) The Notes have been duly authorized and executed by the
Corporation and, when authenticated by The Chase Manhattan Bank, as
Trustee, in the manner provided in the Indenture and delivered against
payment therefor, will constitute valid and legally binding obligations
of the Corporation, enforceable against the Corporation in accordance
with their terms, subject to the qualifications that the enforceability
of the Corporation's obligations under the Notes may be limited by
bankruptcy, insolvency, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally and by
general
5
<PAGE>
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law), and are entitled to
the benefits afforded by the Indenture in accordance with the terms of
the Indenture and the Notes.
(v) The Registration Statement has become effective under the 1933 Act,
and, to the best of the knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been instituted or are
pending or threatened under the 1933 Act.
(vi) This Agreement has been duly authorized, executed and delivered by
the Corporation.
(vii) The performance by the Corporation of this Agreement will not
contravene any of the provisions of the Restated Certificate of
Incorporation or By-Laws of the Corporation.
(viii) The Corporation is not a holding company under the Public
Utility Holding Company Act of 1935, as amended.
(ix) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is
required for the issue and sale of the Notes or the consummation by the
Corporation of the transactions contemplated by this Agreement or the
Indenture, except such as have been obtained under the 1933 Act and the
Trust Indenture Act and such consents, approvals, authorizations,
orders, registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Notes by the Underwriters.
(x) The Registration Statement as of the date of effectiveness under
the 1933 Act and the Prospectus as of the date it was filed with, or
transmitted for filing to, the Commission complied as to form in all
material respects with the requirements of the 1933 Act and the 1933
Act Regulations; and nothing has come to their attention that would
lead them to believe that the Registration Statement as of the date of
effectiveness under the 1933 Act (or if an amendment to such
Registration Statement or an annual report on Form 10-K has been filed
by the Corporation with the Commission subsequent to the effectiveness
of the Registration Statement, then at the time of the most recent such
filing) contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading or that the Prospectus as of
the date it was filed with, or transmitted for filing to, the
Commission and at the Closing Date contained or contains an untrue
statement of a material fact or omitted or omits to state a material
fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading. Such
opinion may state that such counsel do not assume any responsibility
for the accuracy, completeness or fairness of the statements contained
in the Registration Statement and Prospectus except as otherwise
expressly provided in such opinion and do not express any opinion or
belief as to the financial statements or other financial data contained
in the Registration Statement and the Prospectus or as to the statement
of the eligibility and qualification of the Trustee.
(xi) The statements made in the Prospectus under the captions
"Description of the Junior Subordinated Notes" and "Description of the
Series Junior Subordinated Notes," insofar as they purport to
summarize provisions of documents specifically referred to therein,
fairly present the information called for with respect thereto by Form
S-3.
6
<PAGE>
In rendering the foregoing opinion or opinions, Dewey Ballantine LLP may
state that such opinion or opinions are limited to the federal laws of the
United States, the laws of the State of New York and the General
Corporation Law of the State of Delaware, and that they are expressing no
opinion as to the effect of the laws of any other jurisdiction. In
addition, such counsel may state that they have relied as to certain
factual matters on information obtained from public officials, officers of
the Corporation and other sources believed by them to be responsible and
that the signatures on all documents examined by them are genuine,
assumptions which such counsel have not independently verified.
(e) You shall have received an opinion, dated the Closing Date, of Ellen T.
Ruff, Esq., General Counsel of the Corporation, to the effect that:
(i) Each of the Corporation and the Principal Subsidiaries is duly
qualified to do business in each jurisdiction in which the ownership or
leasing of its property or the conduct of its business requires such
qualification, except where the failure to so qualify, considering all
such cases in the aggregate, does not have a material adverse effect on
the business, properties, financial position or results of operations
of the Corporation and its subsidiaries taken as a whole.
(ii) The descriptions in the Registration Statement and the Prospectus
of legal or governmental proceedings are accurate and fairly present
the information required to be shown, and such counsel does not know of
any litigation or any legal or governmental proceeding instituted or
threatened against the Corporation or any of its subsidiaries or any of
their respective properties that would be required to be disclosed in
the Prospectus and is not so disclosed.
Such counsel shall also state that nothing has come to her attention that
has caused her to believe that the Registration Statement as of the date of
effectiveness under the 1933 Act and the Prospectus as of the date it was
filed with, or transmitted for filing to, the Commission, contained any
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading, or that the Prospectus as of the date it was filed with, or
transmitted for filing to, the Commission and at the Closing Date,
contained or contains any untrue statement of a material fact or omitted or
omits to state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. Such counsel may also state that, except as otherwise expressly
provided in such opinion, she does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement and the Prospectus and does not express any opinion
or belief as to the financial statements or other financial data contained
in the Registration Statement and the Prospectus.
In rendering the foregoing opinion, such counsel may rely, to the extent
recited therein, upon opinions of local counsel. Such counsel may also
state that he has relied as to certain factual matters on information
obtained from public officials, officers of the Corporation and other
sources believed by him to be responsible.
(f) You shall have received the opinion or opinions of Sullivan & Cromwell,
counsel for the Underwriters, dated the Closing Date, with respect to the
incorporation of the Corporation, the
7
<PAGE>
validity of the Notes, the Registration Statement and the Prospectus, as
amended or supplemented, and such other related matters as you may require,
and the Corporation shall have furnished to such counsel such documents as
they request for the purpose of enabling them to pass upon such matters.
(g) On or after the date hereof, there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally or of the securities of Duke Energy Corporation, the Corporation,
Duke Capital Financing Trust I or Duke Capital Financing Trust II on the
New York Stock Exchange; or (ii) a general moratorium on commercial banking
activities in New York declared by either federal or New York State
authorities; or (iii) the outbreak or material escalation of hostilities
involving the United States or the declaration by the United States of a
national emergency or war if the effect of any such event specified in this
clause (g) in your judgment makes it impracticable or inadvisable to
proceed with the public offering or the delivery of the Notes being
delivered at the Closing Date on the terms and in the manner contemplated
in the Prospectus. In such event there shall be no liability on the part of
any party to any other party except as otherwise provided in Section 7
hereof and except for the expenses to be borne by the Corporation as
provided in Section 5(h) hereof.
(h) You shall have received a certificate of the Chairman of the Board and
President or any Vice President and a principal financial or accounting
officer of the Corporation, dated the Closing Date, in which such officers,
to the best of their knowledge after reasonable investigation, shall state
that the representations and warranties of the Corporation in this
Agreement are true and correct, that the Corporation has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to the Closing Date, that the conditions specified in
Section 6(b) and Section 6(c) have been satisfied, and that no stop order
suspending the effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted or are threatened
by the Commission.
(i) On the date of this Agreement, you shall have received letters dated
the date hereof, in form and substance satisfactory to you, from the
Corporation's independent public accountants, containing statements and
information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and
certain financial information contained in or incorporated by reference
into the Prospectus.
(j) At the Closing Date you shall have received from the Corporation's
independent public accountants letters, dated the Closing Date, to the
effect that such accountants reaffirm the statements made in the letters
furnished pursuant to paragraph (i) of this Section 6, except that the
specified date referred to shall be a date not more than three business
days prior to the Closing Date.
The Corporation will furnish you with such conformed copies of such opinions,
certificates, letters and documents as you reasonably request.
7. Indemnification. (a) The Corporation agrees to indemnify and hold harmless
each Underwriter and each person, if any, who controls any Underwriter within
the meaning of Section 15 of the 1933 Act, as follows:
(i) 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 the Registration
8
<PAGE>
Statement (or any amendment thereto), 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
Preliminary Prospectus, the prospectus constituting a part of the
Registration Statement in the form in which it became effective or the
Prospectus (or any amendment or supplement thereto) 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, unless such statement or omission or such
alleged statement or omission was made in reliance upon and in conformity
with written information furnished to the Corporation by any Underwriter
through you expressly for use in the Registration Statement (or any
amendment thereto) or such Preliminary Prospectus, such prospectus, or the
Prospectus (or any amendment or supplement thereto);
(ii) against any and all loss, liability, claim, damage and expense
whatsoever to the extent of the aggregate amount paid in settlement of any
litigation, 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 written consent of the
Corporation; and
(iii) against any and all expense whatsoever reasonably incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the extent
that any such expense is not paid under (i) or (ii) above.
In no case shall the Corporation be liable under this indemnity agreement with
respect to any claim made against any Underwriter or any such controlling
person unless the Corporation shall be notified in writing of the nature of the
claim within a reasonable time after the assertion thereof, but failure so to
notify the Corporation shall not relieve it from any liability which it may
have otherwise than on account of this indemnity agreement. The Corporation
shall be entitled to participate at its own expense in the defense, or, if it
so elects, within a reasonable time after receipt of such notice, to assume the
defense of any suit brought to enforce any such claim, but if it so elects to
assume the defense, such defense shall be conducted by counsel chosen by it and
approved by the Underwriter or Underwriters or controlling person or persons,
or defendant or defendants in any suit so brought, which approval shall not be
unreasonably withheld. In any such suit, any Underwriter or any such
controlling person shall have the right to employ its own counsel, but the fees
and expenses of such counsel shall be at the expense of such Underwriter or
such controlling person unless (i) the Corporation and such Underwriter shall
have mutually agreed to the employment of such counsel, or (ii) the named
parties to any such action (including any impleaded parties) include both such
Underwriter or such controlling person and the Corporation and such Underwriter
or such controlling person shall have been advised by such counsel that a
conflict of interest between the Corporation and such Underwriter or such
controlling person may arise and for this reason it is not desirable for the
same counsel to represent both the indemnifying party and also the indemnified
party (it being understood, however, that the Corporation shall not, in
connection with any one such action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys for all such Underwriters and all such
controlling persons, which firm shall
9
<PAGE>
be designated in writing by you). The Corporation agrees to notify you within a
reasonable time of the assertion of any claim against it, any of its officers
or directors or any person who controls the Corporation within the meaning of
Section 15 of the 1933 Act, in connection with the sale of the Notes.
(b) Each Underwriter severally agrees that it will indemnify and hold harmless
the Corporation, its directors and each of the officers of the Corporation who
signed the Registration Statement and each person, if any, who controls the
Corporation within the meaning of Section 15 of the 1933 Act to the same extent
as the indemnity contained in subsection (a) of this Section, but only with
respect to statements or omissions made in the Registration Statement (or any
amendment thereto) or any Preliminary Prospectus, such prospectus or the
Prospectus (or any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Corporation by such
Underwriter through you expressly for use in the Registration Statement (or any
amendment thereto), such Preliminary Prospectus, such prospectus or the
Prospectus (or any amendment or supplement thereto). In case any action shall
be brought against the Corporation or any person so indemnified based on the
Registration Statement (or any amendment thereto) or such Preliminary
Prospectus, such prospectus or the Prospectus (or any amendment or supplement
thereto) and in respect of which indemnity may be sought against any
Underwriter, such Underwriter shall have the rights and duties given to the
Corporation, and the Corporation and each person so indemnified shall have the
rights and duties given to the Underwriters, by the provisions of subsection
(a) of this Section.
8. Default by One or More of the Underwriters. (a) If any Underwriter shall
default in its obligation to purchase the Notes which it has agreed to purchase
hereunder on the Closing Date, you may in your discretion arrange for you or
another party or other parties to purchase such Notes on the terms contained
herein. If within thirty-six hours after such default by any Underwriter you do
not arrange for the purchase of such Notes, then the Corporation shall be
entitled to a further period of thirty-six hours within which to procure
another party or other parties satisfactory to you to purchase such Notes on
such terms. In the event that, within the respective prescribed periods, you
notify the Corporation that you have so arranged for the purchase of such
Notes, or the Corporation notifies you that it has so arranged for the purchase
of such Notes, you or the Corporation shall have the right to postpone such
Closing Date for a period of not more than seven days, in order to effect
whatever changes may thereby be made necessary in the Registration Statement or
the Prospectus, or in any other documents or arrangements, and the Corporation
agrees to file promptly any amendments to the Registration Statement or the
Prospectus which may be required. The term "Underwriter" as used in this
Agreement shall include any person substituted under this Section with like
effect as if such person had originally been a party to this Agreement with
respect to such Notes.
(b) If, after giving effect to any arrangements for the purchase of the Notes
of a defaulting Underwriter or Underwriters by you or the Corporation as
provided in subsection (a) above, the aggregate amount of such Notes which
remains unpurchased does not exceed one-eleventh of the aggregate amount of all
the Notes to be purchased at such Closing Date, then the Corporation shall have
the right to require each non-defaulting Underwriter to purchase the amount of
Notes which such Underwriter agreed to purchase hereunder at such Closing Date
and, in addition, to require each non-defaulting Underwriter to purchase its
pro rata share (based on the amount of Notes which such
10
<PAGE>
Underwriter agreed to purchase hereunder) of the Notes of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of the Notes
of a defaulting Underwriter or Underwriters by you or the Corporation as
provided in subsection (a) above, the aggregate amount of such Notes which
remains unpurchased exceeds one-eleventh of the aggregate amount of all the
Notes to be purchased at such Closing Date, or if the Corporation shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Notes of a defaulting Underwriter or Underwriters,
then this Agreement shall thereupon terminate, without liability on the part of
any non-defaulting Underwriter or the Corporation, except for the expenses to
be borne by the Corporation as provided in Section 5(h) hereof and the
indemnity agreement in Section 7 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
9. Representations and Indemnities to Survive Delivery. The respective
indemnities, agreements, representations, warranties and other statements of
the Corporation or its officers and of the several Underwriters set forth in or
made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation, or statement as to the results thereof, made
by or on behalf of any Underwriter or the Corporation, or any of its officers
or directors or any controlling person, and will survive delivery of and
payment for the Notes.
10. Notices. All communications hereunder will be in writing and, if sent to
the Underwriters, will be mailed, delivered or telecopied and confirmed to you
in care of at , attention of or,
if sent to the Corporation, will be mailed, delivered or telecopied and
confirmed to it at 422 South Church Street, Charlotte, N.C. 28202, telephone
number (704) 382-5159, attention of Richard J. Osborne, Vice President and
Chief Financial Officer; provided, however, that any notice to an Underwriter
pursuant to Section 7 hereof shall be delivered or sent by mail or telecopy to
such Underwriter at its address or telecopy number set forth in its
Underwriters' Questionnaire or telex constituting such Questionnaire, which
address or telecopy number will be supplied to the Corporation by you. Any such
communications shall take effect upon receipt thereof.
11. Business Day. As used herein, the term "business day" shall mean any day
when the Commission's office in Washington, D.C. is open for business.
12. Successors. This Agreement shall inure to the benefit of and be binding
upon the Underwriters and the Corporation and their respective successors.
Nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any person, firm or corporation, other than the parties
hereto and their respective successors and the controlling persons and the
officers and directors referred to in Section 7, and their respective
successors, heirs and legal representatives any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision herein
contained; this Agreement and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of the parties
hereto and their respective successors and said controlling persons, officers
and directors and their respective successors, heirs and legal
11
<PAGE>
representatives, and for the benefit of no other person, firm or corporation.
No purchaser of Notes from any Underwriter shall be deemed to be a successor or
assign by reason merely of such purchase.
13. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original, but all of which together
shall constitute one and the same instrument.
14. Applicable Law. This Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of New York.
If the foregoing is in accordance with your understanding, kindly sign and
return to us two counterparts hereof, and upon your acceptance, this letter and
such acceptance will become a binding agreement between the Corporation, on the
one hand, and each of the Underwriters, on the other hand, in accordance with
its terms.
Very truly yours,
Duke Capital Corporation
By:_______________________
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
By:__________________________
12
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF
NOTES TO BE
UNDERWRITER PURCHASED
----------- -----------
<S> <C>
$
-----------
Total........................................................... $
===========
</TABLE>
13
<PAGE>
EXHIBIT 1.3
PREFERRED SECURITIES
DUKE CAPITAL FINANCING TRUST [ ]
% Trust Preferred Securities
(Liquidation Amount $ Per Preferred Security)
UNDERWRITING AGREEMENT
,
As representatives of the several Underwriters
named in Schedule A hereto
Gentlemen:
1. Introductory. Duke Capital Financing Trust [ ], a Delaware statutory
business trust (the "Trust"), and Duke Capital Corporation, a Delaware
corporation (the "Corporation"), propose that the Trust issue and sell to the
Underwriters named in Schedule A hereto (the "Underwriters") % Trust
Preferred Securities (liquidation amount $ per preferred security),
representing preferred undivided beneficial interests in the assets of the
Trust (the "Preferred Securities"), guaranteed by the Corporation as to the
payment of distributions and payments upon liquidation or redemption, to the
extent set forth in the Guarantee Agreement between the Corporation and The
Chase Manhattan Bank, as trustee thereunder (the "Guarantee Trustee"), to be
dated as of the Closing Date (as defined in Section 3 hereof) (the
"Guarantee"), and the Trust and the Corporation hereby agree with you as
hereinafter set forth in this Agreement.
The entire proceeds from the sale of the Preferred Securities will be combined
with the entire proceeds from the sale by the Trust to the Corporation of its
common securities, representing common undivided beneficial interests in the
assets of the Trust (the "Common Securities"), and will be used by the Trust to
purchase the Series % Junior Subordinated Notes due , (the
"Notes") to be issued by the Corporation. The Preferred Securities and the
Common Securities will be issued pursuant to the Amended and Restated Trust
Agreement, dated as of , (the "Trust Agreement"), among the
Corporation, as Depositor, and the trustees named therein, including The Chase
Manhattan Bank, as property trustee (the "Property Trustee"),
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<PAGE>
and Chase Manhattan Bank Delaware, as Delaware trustee (the "Delaware
Trustee"). The Notes will be issued pursuant to a Subordinated Indenture, dated
as of April 1, 1998 (the "Original Indenture"), between the Corporation and The
Chase Manhattan Bank, as Trustee (the "Indenture Trustee"), as amended and
supplemented, to the date hereof, and as to be supplemented by a supplemental
indenture, dated as of , (the "Supplemental Indenture" and,
together with the Original Indenture as theretofore amended and supplemented,
the "Indenture").
2. Representations and Warranties of the Trust and the Corporation. The Trust
and the Corporation, jointly and severally, represent and warrant to, and agree
with, the several Underwriters that:
(a) A registration statement (Nos. and ), including a
prospectus, relating to the Preferred Securities, the Guarantee and the
Notes has been filed with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933 (the "1933 Act"). Such
registration statement and any post-effective amendment thereto, each in
the form heretofore delivered to you, and, excluding exhibits thereto but
including all documents incorporated by reference in the prospectus
contained therein, to you for each of the other Underwriters, have been
declared effective by the Commission in such form, and no stop order
suspending the effectiveness of such registration statement has been issued
and no proceeding for that purpose has been initiated or threatened by the
Commission (any preliminary prospectus included in such registration
statement or filed with the Commission pursuant to Rule 424(a) of the rules
and regulations of the Commission under the 1933 Act being hereinafter
called a "Preliminary Prospectus"; the various parts of such registration
statement, including all exhibits thereto and including the documents
incorporated by reference in the prospectus contained in the registration
statement at the time such part of the registration statement became
effective, each as amended at the time such part of the registration
statement became effective, being hereinafter called the "Registration
Statement"; and the final prospectus relating to the Preferred Securities,
the Guarantee and the Notes, in the form first filed pursuant to Rule
424(b) under the 1933 Act, being hereinafter called the "Prospectus"; and
any reference herein to any Preliminary Prospectus or the Prospectus shall
be deemed to refer to and include the documents incorporated by reference
therein, as of the date of such Preliminary Prospectus or Prospectus, as
the case may be; any reference to any amendment or supplement to any
Preliminary Prospectus or Prospectus shall be deemed to refer to and
include any documents filed after the date of such Preliminary Prospectus
or Prospectus, as the case may be, under the Securities Exchange Act of
1934, as amended (the "1934 Act"), and incorporated by reference in such
Preliminary Prospectus or Prospectus, as the case may be; and any reference
to any amendment to the Registration Statement shall be deemed to refer to
and include any annual report of the Corporation filed pursuant to Section
13(a) or 15(d) of the 1934 Act after the effective date of the Registration
Statement that is incorporated by reference in the Registration Statement).
(b) The Registration Statement conforms and the Prospectus will conform in
all material respects to the requirements of the 1933 Act and the rules and
regulations thereunder ("1933 Act Regulations"), and the Registration
Statement does not and the Prospectus will not include any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, except
that the foregoing
2
<PAGE>
does not apply to statements or omissions in any such document based upon
written information furnished to the Trust or the Corporation by any
Underwriter specifically for use therein.
(c) The documents incorporated by reference in the Prospectus, at the time
they were filed with the Commission, conformed in all material respects to
the requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations"), and, when read together
with the other information in the Prospectus, do not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading, and any documents deemed to be incorporated by reference in the
Prospectus will, when they are filed with the Commission, comply in all
material respects with the requirements of the 1934 Act and the 1934 Act
Regulations, and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which
they are made, not misleading.
(d) The compliance by the Corporation and the Trust with all of the
provisions of this Agreement and the consummation of the transactions
herein contemplated will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Corporation or any of its Principal
Subsidiaries is a party or by which any of them or their respective
property is bound or to which any of their property or assets is subject,
nor will such action result in any violation of the provisions of the
Restated Certificate of Incorporation or By-Laws of the Corporation, the
Trust Agreement or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over (i) the
Corporation or its Principal Subsidiaries or any of their respective
property or (ii) the Trust; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the consummation by the Corporation or the
Trust of the transactions contemplated by this Agreement, except for the
registration under the 1933 Act of the Preferred Securities, the Guarantee
and the Notes and such consents, approvals, authorizations, registrations
or qualifications as may be required under state securities or Blue Sky
laws in connection with the purchase and distribution of the Preferred
Securities by the Underwriters.
(e) Each of PanEnergy Corp, Panhandle Eastern Pipe Line Company, Texas
Eastern Transmission Corporation, Trunkline Gas Company and Algonquin Gas
Transmission Company, each a Delaware corporation (and hereinafter called a
"Principal Subsidiary"), is a direct or indirect wholly-owned subsidiary of
the Corporation.
3. Purchase, Sale and Delivery of Preferred Securities. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Trust agrees to sell to each of the
Underwriters and each of the Underwriters agrees, severally and not jointly, to
purchase from the Trust at a purchase price of $ per Preferred Security, the
number of Preferred Securities set forth opposite the name of such Underwriter
in Schedule A hereto, plus the respective principal amount of additional
Preferred Securities which each such Underwriter may become obligated to
purchase pursuant to the provisions of Section 8 hereof.
3
<PAGE>
As compensation to the Underwriters for their commitments hereunder, and in
view of the fact that the proceeds of the sale of the Preferred Securities will
be used by the Trust to purchase the Notes of the Corporation, the Corporation
hereby agrees to pay at the Closing Date (as defined below) to , for
the accounts of the several Underwriters, a commission equal to $ per
Preferred Security, except that such commission will be $ per Preferred
Security sold to certain institutions as disclosed by .
The Preferred Securities to be purchased by the Underwriters hereunder will be
represented by a global certificate or certificates in book-entry form which
will be deposited by or on behalf of the Trust with The Depository Trust
Company ("DTC") or its designated custodian and registered in the name of Cede
& Co., as nominee of DTC. The Trust will deliver the Preferred Securities to
, for the respective accounts of the Underwriters, against
payment by or on behalf of such Underwriters of the purchase price therefor by
wire transfer of immediately available funds to the Trust, by causing DTC to
credit the Preferred Securities to the account of , at DTC.
The time and date of such delivery and payment (the "Closing Date") shall be
10:00 a.m., New York City time, on , (unless postponed in
accordance with the provisions of Section 8), or at such other time and date as
you, the Trust and the Corporation may agree upon in writing at the office of
Dewey Ballantine LLP, 1301 Avenue of the Americas, New York, New York 10019, or
at such other place as you, the Trust and the Corporation may determine. It is
understood that each Underwriter has authorized , for its
account, to accept delivery of, receipt for, and make payment of the purchase
price, for the Preferred Securities which it has agreed to purchase.
At the Closing Date, the Corporation will pay, or cause to be paid, the
compensation payable to the Underwriters under this Section 3 by wire transfer
of immediately available funds to , as representative of
and on behalf of the Underwriters.
4. Offering by the Underwriters. It is understood that the several Underwriters
propose to offer the Preferred Securities for sale to the public as set forth
in the Prospectus.
5. Covenants of the Trust and the Corporation. The Trust and the Corporation,
jointly and severally, covenant and agree with the several Underwriters that:
(a) The Trust and the Corporation will advise you promptly of any amendment
or supplementation of the Registration Statement or the Prospectus and of
the institution by the Commission of any stop order proceedings in respect
of the Registration Statement, and will use their best efforts to prevent
the issuance of any such stop order and to obtain as soon as possible its
lifting, if issued.
(b) If at any time when a prospectus relating to the Preferred Securities,
the Guarantee or the Notes is required to be delivered under the 1933 Act
any event occurs as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact, or omit
to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or
if it is necessary at any time
4
<PAGE>
to amend the Prospectus to comply with the 1933 Act, the Trust and the
Corporation promptly will prepare and file with the Commission an
amendment, supplement or an appropriate document pursuant to Section 13 or
14 of the 1934 Act which will correct such statement or omission or which
will effect such compliance.
(c) The Trust and the Corporation, during the period when a prospectus
relating to the Preferred Securities, the Guarantee or the Notes is
required to be delivered under the 1933 Act, will file promptly all
documents required to be filed with the Commission pursuant to Section 13
or 14 of the 1934 Act.
(d) The Corporation will make generally available to its security holders,
in each case as soon as practicable but not later than 60 days after the
close of the period covered thereby, earnings statements (in form complying
with the provisions of Section 11(a) of the 1933 Act, which need not be
certified by independent certified public accountants unless required by
the 1933 Act) covering (i) a twelve-month period beginning not later than
the first day of the Corporation's fiscal quarter next following the
effective date of the Registration Statement and (ii) a twelve-month period
beginning not later than the first day of the Corporation's fiscal quarter
next following the date of this Agreement.
(e) The Trust and the Corporation will furnish to you, without charge,
copies of the Registration Statement ( of which will be signed and will
include all exhibits other than those incorporated by reference), the
Prospectus, and all amendments and supplements to such documents, in each
case as soon as available and in such quantities as you reasonably request.
(f) The Trust and the Corporation will arrange or cooperate in arrangements
for the qualification of the Preferred Securities, and to the extent
required or advisable, the Guarantee and the Notes for sale under the laws
of such jurisdictions as you designate and will continue such
qualifications in effect so long as required for the distribution;
provided, however, that neither the Trust nor the Corporation shall be
required to qualify as a foreign corporation or to file any general
consents to service of process under the laws of any state where it is not
now so subject.
(g) The Corporation will not, during the period beginning from the date
hereof and continuing to and including the date fifteen days after the date
hereof, sell, offer to sell, grant any option for the sale of, or otherwise
dispose of any Preferred Securities, any security convertible into or
exchangeable for the Preferred Securities or the Notes or any debt security
substantially similar to the Notes or equity securities substantially
similar to the Preferred Securities (except for the Notes and the Preferred
Securities issued pursuant to this Agreement), without your prior written
consent.
(h) The Corporation will pay all expenses incident to the performance of
the obligations of the Trust and the Corporation under this Agreement
including (i) the printing and filing of the Registration Statement and the
printing of this Agreement and the Blue Sky Survey, (ii) the issuance and
delivery of the Preferred Securities, the Guarantee and the Notes as
specified herein, (iii) the fees and disbursements of counsel for the
Underwriters in connection with the qualification of the Preferred
Securities, the Guarantee and the Notes under the securities laws of any
jurisdiction in accordance with the provisions of Section 5(f) and in
connection with the preparation of the Blue Sky Survey, such fees not to
exceed $5,000, (iv) the printing and delivery to the Underwriters, in
quantities as hereinabove referred to, of copies of the
5
<PAGE>
Registration Statement and Prospectus and any amendments thereto, (v) any
fees charged by independent rating agencies for rating the Preferred
Securities, (vi) all fees and expenses of the Trustees, including the
Indenture Trustee, Property Trustee, Guarantee Trustee and Delaware Trustee
and the fees and disbursements of their counsel, (vii) any fees and
expenses in connection with the listing of the Preferred Securities and, if
applicable, the Notes on the New York Stock Exchange, (viii) any filing fee
required by the National Association of Securities Dealers, Inc. and (ix)
the costs of any depository arrangements for the Preferred Securities with
DTC or any successor depository.
6. Conditions of the Obligations of the Underwriters. The obligations of the
several Underwriters to purchase and pay for the Preferred Securities will be
subject to the accuracy of the representations and warranties on the part of
the Trust or the Corporation herein, to the accuracy of the statements of
trustees or representatives of the Trust and officers of the Corporation made
pursuant to the provisions hereof, to the performance by the Trust and the
Corporation of their obligations hereunder and to the following additional
conditions precedent:
(a) Prior to the Closing Date, no stop order suspending the effectiveness
of the Registration Statement shall have been issued and no proceedings for
that purpose shall have been instituted or, to the knowledge of the Trust,
the Corporation or you, shall be threatened by the Commission.
(b) Prior to the Closing Date, the rating assigned by Moody's Investors
Service, Inc. or Standard & Poor's Ratings Group to (i) any preferred
securities or any debt securities of the Corporation or (ii) any trust
preferred securities of Duke Capital Financing Trust I or Duke Capital
Financing Trust II as of the date of this Agreement shall not have been
lowered.
(c) Since the respective most recent dates as of which information is given
in the Prospectus and up to the Closing Date, there shall not have been any
material adverse change in the condition of the Trust or the Corporation,
financial or otherwise, except as reflected in or contemplated by the
Prospectus, and, since such dates and up to the Closing Date, there shall
not have been any material transaction entered into by the Corporation
other than transactions contemplated by the Prospectus and transactions in
the ordinary course of business.
(d) You shall have received an opinion or opinions of Dewey Ballantine LLP,
counsel to the Corporation, dated the Closing Date, to the effect that:
(i) The Corporation has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of
Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus.
(ii) Each of the Principal Subsidiaries has been duly incorporated and
is validly existing as a corporation in good standing under the laws of
its jurisdiction of incorporation, with power and authority (corporate
and other) to own its properties and conduct its business as described
in the Prospectus.
(iii) The Trust Agreement has been duly authorized, executed and
delivered by the Corporation and, assuming due authorization, execution
and delivery thereof by The Chase Manhattan Bank, as Trustee,
constitutes a valid and legally binding instrument of the Corporation,
enforceable against the Corporation in accordance with its terms,
subject to
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the qualifications that the enforceability of the Corporation's
obligations under the Trust Agreement may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar laws relating
to or affecting creditors' rights generally, and by general principles
of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law).
(iv) The Guarantee Agreement has been duly authorized, executed and
delivered by the Corporation and constitutes a valid and legally
binding instrument of the Corporation, enforceable against the
Corporation in accordance with its terms, subject to the qualifications
that the enforceability of the Corporation's obligations under the
Guarantee Agreement may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and by general principles of
equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law).
(v) The Indenture has been duly authorized, executed and delivered by
the Corporation and, assuming due authorization, execution and delivery
thereof by The Chase Manhattan Bank, as Trustee, constitutes a valid
and legally binding instrument of the Corporation, enforceable against
the Corporation in accordance with its terms, subject to the
qualifications that the enforceability of the Corporation's obligations
under the Indenture may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and by general principles of
equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law).
(vi) The Notes have been duly authorized and executed by the
Corporation and, when authenticated by The Chase Manhattan Bank, as
Trustee, in the manner provided in the Indenture and delivered against
payment therefor, will constitute valid and legally binding obligations
of the Corporation, enforceable against the Corporation in accordance
with their terms, subject to the qualifications that the enforceability
of the Corporation's obligations under the Notes may be limited by
bankruptcy, insolvency, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally and by
general principles of equity (regardless of whether such enforceability
is considered in a proceeding in equity or at law), and are entitled to
the benefits afforded by the Indenture in accordance with the terms of
the Indenture and the Notes.
(vii) The Registration Statement has become effective under the 1933
Act, and, to the best of the knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been instituted or are
pending or threatened under the 1933 Act.
(viii) Each of the Indenture, the Guarantee Agreement and the Trust
Agreement has been duly qualified under the Trust Indenture Act of
1939, as amended.
(ix) This Agreement has been duly authorized, executed and delivered by
the Corporation.
(x) The performance by the Corporation of this Agreement will not
contravene any of the provisions of the Restated Certificate of
Incorporation or By-Laws of the Corporation.
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(xi) The Corporation is not a holding company under the Public Utility
Holding Company Act of 1935, as amended.
(xii) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is
required for the issue and sale of the Preferred Securities, the issue
of the Guarantee or the issue and sale of the Notes or the consummation
by the Corporation and the Trust of the transactions contemplated by
this Agreement, the Trust Agreement, the Guarantee or the Indenture,
except such as have been obtained under the 1933 Act and the Trust
Indenture Act and such consents, approvals, authorizations, orders,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Preferred Securities and the Guarantee by the
Underwriters.
(xiii) The Registration Statement as of the date of effectiveness under
the 1933 Act and the Prospectus as of the date it was filed with, or
transmitted for filing to, the Commission complied as to form in all
material respects with the requirements of the 1933 Act and the 1933
Act Regulations; and nothing has come to their attention that would
lead them to believe that the Registration Statement as of the date of
effectiveness under the 1933 Act (or if an amendment to such
Registration Statement or an annual report on Form 10-K has been filed
by the Corporation with the Commission subsequent to the effectiveness
of the Registration Statement, then at the time of the most recent such
filing) contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading or that the Prospectus as of
the date it was filed with, or transmitted for filing to, the
Commission and at the Closing Date contained or contains an untrue
statement of a material fact or omitted or omits to state a material
fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading. Such
opinion may state that such counsel do not assume any responsibility
for the accuracy, completeness or fairness of the statements contained
in the Registration Statement and Prospectus except as otherwise
expressly provided in such opinion and do not express any opinion or
belief as to the financial statements or other financial data contained
in the Registration Statement and the Prospectus or as to the statement
of the eligibility and qualification of the Trustee.
(xiv) The statements made in the Prospectus under the captions
"Description of the Preferred Securities," "Description of the
Guarantees," "Description of the Series Junior Subordinated Notes"
and "Description of the Junior Subordinated Notes," insofar as they
purport to summarize provisions of documents specifically referred to
therein, fairly present the information called for with respect thereto
by Form S-3, and the statements as to matters of law and legal
conclusions contained in the Prospectus under the caption "Material
Federal Income Tax Considerations" are correct in all material
respects.
In rendering the foregoing opinion or opinions, Dewey Ballantine LLP may
state that such opinion or opinions are limited to the Federal laws of the
United States, the laws of the State of New York and the General
Corporation Law of the State of Delaware, and that they are expressing no
opinion as to the effect of the laws of any other jurisdiction. In
addition, such counsel may state that they have relied as to certain
factual matters on information obtained from public officials, officers of
the Corporation and other sources believed by them to be
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responsible and that the signatures on all documents examined by them are
genuine, assumptions which such counsel have not independently verified.
(e) You shall have received an opinion, dated the Closing Date, of Ellen T.
Ruff, Esq., General Counsel of the Corporation, to the effect that:
(i) Each of the Corporation and the Principal Subsidiaries is duly
qualified to do business in each jurisdiction in which the ownership or
leasing of its property or the conduct of its business requires such
qualification, except where the failure to so qualify, considering all
such cases in the aggregate, does not have a material adverse effect on
the business, properties, financial position or results of operations
of the Corporation and its subsidiaries taken as a whole.
(ii) The descriptions in the Registration Statement and the Prospectus
of legal or governmental proceedings are accurate and fairly present
the information required to be shown, and such counsel does not know of
any litigation or any legal or governmental proceeding instituted or
threatened against the Corporation or any of its subsidiaries or any of
their respective properties that would be required to be disclosed in
the Prospectus and is not so disclosed.
Such counsel shall also state that nothing has come to her attention that
has caused her to believe that the Registration Statement as of the date of
effectiveness under the 1933 Act and the Prospectus as of the date it was
filed with, or transmitted for filing to, the Commission, contained any
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading, or that the Prospectus as of the date it was filed with, or
transmitted for filing to, the Commission and at the Closing Date,
contained or contains any untrue statement of a material fact or omitted or
omits to state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. Such counsel may also state that, except as otherwise expressly
provided in such opinion, she does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement and the Prospectus and does not express any opinion
or belief as to the financial statements or other financial data contained
in the Registration Statement and the Prospectus.
In rendering the foregoing opinion, such counsel may rely, to the extent
recited therein, upon opinions of local counsel. Such counsel may also
state that he has relied as to certain factual matters on information
obtained from public officials, officers of the Corporation and other
sources believed by him to be responsible.
(f) You shall have received the opinion of Richards, Layton & Finger, P.A.,
special Delaware counsel to the Trust, dated the Closing Date, to the
effect that:
(i) The Trust has been duly created and is validly existing in good
standing as a business trust under the Business Trust Act of the State
of Delaware (the "Delaware Business Trust Act"), and all filings
required under the laws of the State of Delaware with respect to the
creation and valid existence of the Trust as a business trust have been
made.
(ii) Under the Delaware Business Trust Act and the Trust Agreement, the
Trust has the business trust power and authority to own property and
conduct its business, all as described in the Prospectus.
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(iii) Under the Delaware Business Trust Act and the Trust Agreement,
the Trust has the business trust power and authority (a) to execute and
deliver this Agreement, (b) to perform its obligations under this
Agreement and (c) to issue and perform its obligations under the
Preferred Securities and the Common Securities.
(iv) Under the Delaware Business Trust Act and the Trust Agreement, the
execution and delivery by the Trust of this Agreement and the
performance by the Trust of its obligations hereunder and under the
Trust Agreement, have been duly authorized by all necessary business
trust action on the part of the Trust.
(v) The Trust Agreement constitutes a valid and binding obligation of
the Corporation and the trustees named therein, enforceable against the
Corporation and the trustees named therein, in accordance with its
terms, subject, as to enforcement, to the effect upon the Trust
Agreement of (a) bankruptcy, insolvency, moratorium, receivership,
liquidation, fraudulent conveyance or transfer, reorganization and
other similar laws relating to or affecting the remedies and rights of
creditors generally, (b) principles of equity, including applicable law
relating to fiduciary duties (regardless of whether considered or
applied in a proceeding in equity or at law) and (c) the effect of
applicable public policy on the enforceability of provisions relating
to indemnification or contribution.
(vi) The Preferred Securities have been duly authorized by the Trust
Agreement and are duly and validly issued and, subject to the
qualifications set forth herein, fully paid and non-assessable
preferred undivided beneficial interests in the assets of the Trust;
the Holders of the Preferred Securities, as beneficial owners of the
Trust (the "Securityholders"), are 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; provided, however, that such counsel may note that the
Securityholders may be obligated, pursuant to the Trust Agreement, to
(a) provide indemnity and/or security in connection with and pay a sum
sufficient to cover any taxes or governmental charges arising from
transfers or exchanges of Preferred Securities certificates and the
issuance of replacement Preferred Securities certificates and (b)
provide security and/or indemnity in connection with requests of or
directions to the Property Trustee (as defined in the Trust Agreement)
to exercise its rights and powers under the Trust Agreement; and under
the Delaware Business Trust Act and the Trust Agreement, the issuance
of the Preferred Securities is not subject to preemptive or other
similar rights.
(vii) The Common Securities have been duly authorized by the Trust
Agreement and are duly and validly issued and fully paid undivided
beneficial interests in the assets of the Trust; and under the Delaware
Business Trust Act and the Trust Agreement, the issuance of the Common
Securities is not subject to preemptive or other similar rights.
(viii) The issuance and sale by the Trust of the Preferred Securities
and the Common Securities, the execution, delivery and performance by
the Trust of this Agreement, the performance by the Trust of the Trust
Agreement, the consummation by the Trust of the transactions
contemplated herein and therein and the compliance by the Trust with
its obligations hereunder do not violate (a) any of the provisions of
the Certificate of Trust of the Trust or the Trust Agreement or (b) any
applicable Delaware law or Delaware administrative regulation.
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(ix) Assuming that the Trust derives no income from or connected with
sources within the State of Delaware and has no assets, activities
(other than having a Delaware trustee as required by the Delaware
Business Trust Act and the filing of documents with the Secretary of
State of the State of Delaware) or employees in the State of Delaware,
no authorization, approval, consent or order of any Delaware court or
Delaware governmental authority or Delaware agency is required to be
obtained by the Trust solely as a result of the issuance and sale of
the Preferred Securities, the consummation by the Trust of the
transactions contemplated in this Agreement and the Trust Agreement or
the compliance by the Trust of its obligations hereunder and
thereunder.
(x) Assuming that the Trust derives no income from or connected with
sources within the State of Delaware and has no assets, activities
(other than having a Delaware trustee as required by the Delaware
Business Trust Act and the filing of documents with the Secretary of
State of the State of Delaware) or employees in the State of Delaware,
and assuming that the Trust is treated as a grantor trust for federal
income tax purposes, the Securityholders (other than those holders of
the Preferred Securities who reside or are domiciled in the State of
Delaware) will have no liability for income taxes imposed by the State
of Delaware solely as a result of their participation in the Trust, and
the Trust will not be liable for any income tax imposed by the State of
Delaware.
In rendering the opinion expressed in this paragraph (f), such counsel need
express no opinion concerning the securities laws of the State of Delaware.
(g) You shall have received the opinion or opinions of Sullivan & Cromwell,
counsel for the Underwriters, dated the Closing Date, with respect to the
incorporation of the Corporation, the validity of the Notes, the
Registration Statement and the Prospectus, as amended or supplemented, and
such other related matters as you may require, and the Corporation shall
have furnished to such counsel such documents as they request for the
purpose of enabling them to pass upon such matters.
(h) On or after the date hereof, there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally or of the securities of Duke Energy Corporation or Duke Capital
Financing Trust I or Duke Capital Financing Trust II on the New York Stock
Exchange; or (ii) a general moratorium on commercial banking activities in
New York declared by either Federal or New York State authorities; or (iii)
the outbreak or material escalation of hostilities involving the United
States or the declaration by the United States of a national emergency or
war if the effect of any such event specified in this clause (h) in your
judgment makes it impracticable or inadvisable to proceed with the public
offering or the delivery of the Preferred Securities being delivered at the
Closing Date on the terms and in the manner contemplated in the Prospectus.
In such event there shall be no liability on the part of any party to any
other party except as otherwise provided in Section 7 hereof and except for
the expenses to be borne by the Corporation as provided in Section 5(h)
hereof.
(i) You shall have received a certificate of the Chairman of the Board and
President or any Vice President and a principal financial or accounting
officer of the Corporation and a certificate of a trustee or authorized
representative of the Trust, each dated the Closing Date, in which such
officers or trustee or representative, as the case may be, to the best of
their knowledge after
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reasonable investigation, shall state that the representations and
warranties of the Corporation and the Trust in this Agreement are true and
correct, that the Corporation and the Trust have complied with all
agreements and satisfied all conditions on their part to be performed or
satisfied at or prior to the Closing Date, that the conditions specified in
Section 6(b) and Section 6(c) have been satisfied, and that no stop order
suspending the effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted or are threatened
by the Commission.
(j) On the date of this Agreement, you shall have received letters dated
the date hereof, in form and substance satisfactory to you, from the
Corporation's independent public accountants, containing statements and
information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and
certain financial information contained in or incorporated by reference
into the Prospectus.
(k) At the Closing Date you shall have received from the Corporation's
independent public accountants letters, dated the Closing Date, to the
effect that such accountants reaffirm the statements made in the letters
furnished pursuant to paragraph (j) of this Section 6, except that the
specified date referred to shall be a date not more than three business
days prior to the Closing Date.
The Corporation will furnish you with such conformed copies of such opinions,
certificates, letters and documents as you reasonably request.
7. Indemnification. (a) The Trust and the Corporation, jointly and severally,
agree to indemnify and hold harmless each Underwriter and each person, if any,
who controls any Underwriter within the meaning of Section 15 of the 1933 Act,
as follows:
(i) 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 the Registration Statement (or any
amendment thereto), 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 Preliminary
Prospectus, the prospectus constituting a part of the Registration
Statement in the form in which it became effective or the Prospectus (or
any amendment or supplement thereto) 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, unless such statement or omission or such alleged statement or
omission was made in reliance upon and in conformity with written
information furnished to the Trust or the Corporation by any Underwriter
through you expressly for use in the Registration Statement (or any
amendment thereto) or such Preliminary Prospectus, such prospectus, or the
Prospectus (or any amendment or supplement thereto);
(ii) against any and all loss, liability, claim, damage and expense
whatsoever to the extent of the aggregate amount paid in settlement of any
litigation, 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 written consent of the
Trust and the Corporation; and
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(iii) against any and all expense whatsoever reasonably incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the extent
that any such expense is not paid under (i) or (ii) above.
In no case shall the Trust or the Corporation be liable under this indemnity
agreement with respect to any claim made against any Underwriter or any such
controlling person unless the Trust and the Corporation shall be notified in
writing of the nature of the claim within a reasonable time after the assertion
thereof, but failure so to notify the Trust or the Corporation shall not
relieve either of them from any liability which either of them may have
otherwise than on account of this indemnity agreement. The Trust and the
Corporation shall be entitled to participate at their own expense in the
defense, or, if they so elect, within a reasonable time after receipt of such
notice, to assume the defense of any suit brought to enforce any such claim,
but if they so elect to assume the defense, such defense shall be conducted by
counsel chosen by them and approved by the Underwriter or Underwriters or
controlling person or persons, or defendant or defendants in any suit so
brought, which approval shall not be unreasonably withheld. In any such suit,
any Underwriter or any such controlling person shall have the right to employ
its own counsel, but the fees and expenses of such counsel shall be at the
expense of such Underwriter or such controlling person unless (i) the Trust and
the Corporation and such Underwriter shall have mutually agreed to the
employment of such counsel, or (ii) the named parties to any such action
(including any impleaded parties) include both such Underwriter or such
controlling person and the Trust or the Corporation and such Underwriter or
such controlling person shall have been advised by such counsel that a conflict
of interest between the Trust or the Corporation and such Underwriter or such
controlling person may arise and for this reason it is not desirable for the
same counsel to represent both the indemnifying party and also the indemnified
party (it being understood, however, that the Trust and the Corporation shall
not, in connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys for all such Underwriters
and all such controlling persons, which firm shall be designated in writing by
you). The Trust and the Corporation agree to notify you within a reasonable
time of the assertion of any claim against them, any of their officers,
directors or trustees or any person who controls the Trust or the Corporation
within the meaning of Section 15 of the 1933 Act, in connection with the sale
of the Preferred Securities.
(b) Each Underwriter severally agrees that it will indemnify and hold harmless
the Trust and the Corporation, their directors, trustees, representatives and
each of the officers of the Corporation who signed the Registration Statement
and each person, if any, who controls them within the meaning of Section 15 of
the 1933 Act to the same extent as the indemnity contained in subsection (a) of
this Section, but only with respect to statements or omissions made in the
Registration Statement (or any amendment thereto) or any Preliminary
Prospectus, such prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Trust or the Corporation by such Underwriter through you expressly for
use in the Registration Statement (or any amendment thereto), such Preliminary
Prospectus, such prospectus or the Prospectus (or any amendment or supplement
thereto). In case any action shall be brought against the Trust or the
Corporation or any person so indemnified based on the Registration Statement
(or
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any amendment thereto) or such Preliminary Prospectus, such prospectus or the
Prospectus (or any amendment or supplement thereto) and in respect of which
indemnity may be sought against any Underwriter, such Underwriter shall have
the rights and duties given to the Trust and the Corporation, and the Trust and
the Corporation and each person so indemnified shall have the rights and duties
given to the Underwriters, by the provisions of subsection (a) of this Section.
8. Default by One or More of the Underwriters. (a) If any Underwriter shall
default in its obligation to purchase the Preferred Securities which it has
agreed to purchase hereunder on the Closing Date, you may in your discretion
arrange for you or another party or other parties to purchase such Preferred
Securities on the terms contained herein. If within thirty-six hours after such
default by any Underwriter you do not arrange for the purchase of such
Preferred Securities, then the Trust and the Corporation shall be entitled to a
further period of thirty-six hours within which to procure another party or
other parties satisfactory to you to purchase such Preferred Securities on such
terms. In the event that, within the respective prescribed periods, you notify
the Trust and the Corporation that you have so arranged for the purchase of
such Preferred Securities, or the Trust or the Corporation notifies you that it
has so arranged for the purchase of such Preferred Securities, you, the Trust
or the Corporation shall have the right to postpone such Closing Date for a
period of not more than seven days, in order to effect whatever changes may
thereby be made necessary in the Registration Statement or the Prospectus, or
in any other documents or arrangements, and the Trust and the Corporation agree
to file promptly any amendments to the Registration Statement or the Prospectus
which may be required. The term "Underwriter" as used in this Agreement shall
include any person substituted under this Section with like effect as if such
person had originally been a party to this Agreement with respect to such
Preferred Securities.
(b) If, after giving effect to any arrangements for the purchase of the
Preferred Securities of a defaulting Underwriter or Underwriters by you, the
Trust or the Corporation as provided in subsection (a) above, the aggregate
number of such Preferred Securities which remains unpurchased does not exceed
one-eleventh of the aggregate number of all the Preferred Securities to be
purchased at such Closing Date, then the Trust and the Corporation shall have
the right to require each non-defaulting Underwriter to purchase the number of
Preferred Securities which such Underwriter agreed to purchase hereunder at
such Closing Date and, in addition, to require each non-defaulting Underwriter
to purchase its pro rata share (based on the number of Preferred Securities
which such Underwriter agreed to purchase hereunder) of the Preferred
Securities of such defaulting Underwriter or Underwriters for which such
arrangements have not been made; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Preferred Securities of a defaulting Underwriter or Underwriters by you, the
Trust or the Corporation as provided in subsection (a) above, the aggregate
number of such Preferred Securities which remains unpurchased exceeds one-
eleventh of the aggregate number of all the Preferred Securities to be
purchased at such Closing Date, or if the Trust or the Corporation shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Preferred Securities of a defaulting Underwriter or
Underwriters, then this Agreement shall thereupon terminate, without liability
on the part of any non-defaulting Underwriter, the Trust or the Corporation,
except for the expenses to be borne by the Corporation as provided in Section
5(h) hereof and the indemnity agreement in Section 7 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
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9. Representations and Indemnities to Survive Delivery. The respective
indemnities, agreements, representations, warranties and other statements of
the Trust and the Corporation or their officers and of the Underwriters set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation, or statement as to the results
thereof, made by or on behalf of the Underwriters or the Trust and the
Corporation, or any of their officers, directors, trustees, representatives or
any controlling person, and will survive delivery of and payment for the
Preferred Securities.
10. Reliance on Your Acts. In all dealings hereunder, you shall act on behalf
of each of the Underwriters, and the parties hereto shall be entitled to act
and rely upon any statement, request, notice or agreement on behalf of any
Underwriter made or given by you.
11. Notices. All communications hereunder will be in writing and, if sent to
the Underwriters, will be mailed, delivered, or telecopied and confirmed
to you as the representatives in care of at
, attention of
, or, if sent to the Trust or the Corporation, will be
mailed, delivered, or telecopied and confirmed to them at 422 South Church
Street, Charlotte, N.C. 28202, telephone number (704) 382-5159, attention of
Richard J. Osborne, Vice President and Chief Financial Officer; provided,
however, that any notice to an Underwriter pursuant to Section 7 hereof shall
be delivered or sent by mail or telecopy to such Underwriter at its address or
telecopy number set forth in its Underwriters' Questionnaire or telex
constituting such Questionnaire, which address or telecopy number will be
supplied to the Trust and the Corporation by you. Any such communications shall
take effect upon receipt thereof.
12. Business Day. As used herein, the term "business day" shall mean any day
when the Commission's office in Washington, D.C. is open for business.
13. Successors. This Agreement shall inure to the benefit of and be binding
upon the Underwriters, the Trust and the Corporation and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
parties hereto and their respective successors and the controlling persons and
the officers, directors, trustees and representatives referred to in Section 7,
and their respective successors, heirs and legal representatives any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained; this Agreement and all conditions and provisions
hereof being intended to be and being for the sole and exclusive benefit of the
parties hereto and their respective successors and said controlling persons,
officers, directors, trustees and representatives and their respective
successors, heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Preferred Securities from any
Underwriter shall be deemed to be a successor or assign by reason merely of
such purchase.
14. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original, but all of which together
shall constitute one and the same instrument.
15. Applicable Law. This Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of New York.
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If the foregoing is in accordance with your understanding, kindly sign and
return to us two counterparts hereof, and upon your acceptance on behalf of
each of the Underwriters, this letter and such acceptance will become a binding
agreement between the Trust and the Corporation, on the one hand, and each of
the Underwriters, on the other hand, in accordance with its terms. It is
understood that your acceptance of this letter on behalf of each of the
Underwriters is pursuant to the authority set forth in a form of Agreement
Among Underwriters, the form of which shall be submitted to the Trust and the
Corporation for examination, but without warranty on your part as to the
authority of the signers thereof.
Very truly yours,
Duke Capital Financing Trust [ ]
By: Duke Capital Corporation
as Depositor
By: _________________________________
Duke Capital Corporation
By: _________________________________
The foregoing Underwriting Agreement is hereby confirmed and accepted as of the
date first above written.
By: ___________________________
16
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
NUMBER OF
PREFERRED
SECURITIES TO
UNDERWRITER BE PURCHASED
- ----------- -------------
<S> <C>
------
Total...........................................................
======
</TABLE>
17
<PAGE>
EXHIBIT 4.1
DUKE CAPITAL CORPORATION
TO
THE CHASE MANHATTAN BANK
Trustee
____________________________________________
Senior Indenture
Dated as of April 1, 1998
____________________________________________
<PAGE>
.......................
CERTAIN SECTIONS OF THIS INDENTURE RELATING TO SECTIONS 310 THROUGH 318,
INCLUSIVE, OF THE TRUST INDENTURE ACT OF 1939:
TRUST INDENTURE
ACT SECTION INDENTURE SECTION
- --------------- -----------------
Section 310(a)(1) ................................... 609
(a)(2) ................................... 609
(a)(3) ................................... Not Applicable
(a)(4) ................................... Not Applicable
(b) ................................... 608
610
Section 311(a) ................................... 613
(b) ................................... 613
Section 312(a) ................................... 701
702
(b) ................................... 702
(c) ................................... 702
Section 313(a) ................................... 703
(b) ................................... 703
(c) ................................... 703
(d) ................................... 703
Section 314(a) ................................... 704
(a)(4) ................................... 101
1005
(b) ................................... Not Applicable
(c)(1) ................................... 102
(c)(2) ................................... 102
(c)(3) ................................... Not Applicable
(d) ................................... Not Applicable
(e) ................................... 102
Section 315(a) ................................... 601
(b) ................................... 602
(c) ................................... 601
(d) ................................... 601
(e) ................................... 514
Section 316(a) ................................... 101
(a)(1)(A) ................................... 502
512
(a)(1)(B) ................................... 513
(a)(2) ................................... Not Applicable
(b) ................................... 508
(c) ................................... 104
Section 317(a)(1) ................................... 503
(a)(2) ................................... 504
(b) ................................... 1003
Section 318(a) ................................... 107
- ---------------
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.
<PAGE>
TABLE OF CONTENTS
PAGE
----
Parties................................................................1
Recitals of the Corporation............................................1
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions........................................ 1
Section 102. Compliance Certificates and Opinions............... 7
Section 103. Form of Documents Delivered to Trustee............. 7
Section 104. Acts of Holders; Record Dates...................... 8
Section 105. Notices, Etc....................................... 10
Section 106. Notice to Holders; Waiver.......................... 11
Section 107. Conflict with Trust Indenture Act.................. 11
Section 108. Effect of Headings and Table of Contents........... 11
Section 109. Successors and Assigns............................. 11
Section 110. Separability Clause................................ 11
Section 111. Benefits of Indenture.............................. 12
Section 112. Governing Law...................................... 12
Section 113. Legal Holidays..................................... 12
ARTICLE TWO
Security Forms
Section 201. Forms Generally.................................... 12
Section 202. Form of Face of Security........................... 13
Section 203. Form of Reverse of Security........................ 14
Section 204. Form of Legend for Global Securities............... 18
Section 205. Form of Trustee's Certificate of Authentication.... 18
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series............... 20
Section 302. Denominations...................................... 23
Section 303. Execution, Authentication, Delivery and Dating..... 23
Section 304. Temporary Securities............................... 25
Section 305. Registration, Registration of Transfer and
Exchange........................................... 25
Section 306. Mutilated, Destroyed, Lost and Stolen Securities... 27
Section 307. Payment of Interest; Interest Rights Preserved..... 28
Section 308. Persons Deemed Owners.............................. 29
Section 309. Cancellation....................................... 29
Section 310. Computation of Interest............................ 29
Section 311. CUSIP Numbers...................................... 29
(i)
<PAGE>
ARTICLE FOUR
PAGE
----
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture............ 30
Section 402. Application of Trust Money......................... 31
ARTICLE FIVE
Remedies
Section 501. Events of Default.................................. 31
Section 502. Acceleration of Maturity; Rescission and
Annulment.......................................... 33
Section 503. Collection of Indebtedness and Suits for
Enforcement by Trustee............................. 34
Section 504. Trustee May File Proofs of Claim................... 34
Section 505. Trustee May Enforce Claims Without Possession of
Securities......................................... 35
Section 506. Application of Money Collected..................... 35
Section 507. Limitation on Suits................................ 35
Section 508. Unconditional Right of Holders to Receive
Principal, Premium and Interest.................... 36
Section 509. Restoration of Rights and Remedies................. 36
Section 510. Rights and Remedies Cumulative..................... 36
Section 511. Delay or Omission Not Waiver....................... 36
Section 512. Control By Holders................................. 37
Section 513. Waiver of Past Defaults............................ 37
Section 514. Undertaking for Costs.............................. 37
Section 515. Waiver of Stay or Extension Laws................... 38
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities................ 38
Section 602. Notice of Defaults................................. 38
Section 603. Certain Rights of Trustee.......................... 38
Section 604. Not Responsible for Recitals or Issuance of
Securities......................................... 39
Section 605. May Hold Securities................................ 40
Section 606. Money Held in Trust................................ 40
Section 607. Compensation and Reimbursement..................... 40
Section 608. Conflicting Interests.............................. 41
Section 609. Corporate Trustee Required; Eligibility............ 41
Section 610. Resignation and Removal; Appointment of Successor.. 41
Section 611. Acceptance of Appointment by Successor............. 42
Section 612. Merger, Conversion, Consolidation or Succession
to Business........................................ 43
Section 613. Preferential Collection of Claims Against
Corporation........................................ 44
Section 614. Appointment of Authenticating Agent................ 44
(ii)
<PAGE>
ARTICLE SEVEN
PAGE
----
Holders' Lists and Reports by Trustee and Corporation
Section 701. Corporation to Furnish Trustee Names and
Addresses of Holders............................... 46
Section 702. Preservation of Information; Communications to
Holders............................................ 46
Section 703. Reports by Trustee................................. 46
Section 704. Reports by Corporation............................. 47
ARTICLE EIGHT
Consolidation, Merger, Conveyance or Transfer
Section 801. Corporation May Consolidate, Etc., on Certain
Terms.............................................. 47
Section 802. Successor Substituted.............................. 47
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of
Holders............................................ 48
Section 902. Supplemental Indentures With Consent of Holders.... 49
Section 903. Execution of Supplemental Indentures............... 50
Section 904. Effect of Supplemental Indentures.................. 50
Section 905. Conformity with Trust Indenture Act................ 50
Section 906. Reference in Securities to Supplemental
Indentures......................................... 50
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest......... 51
Section 1002. Maintenance of Office or Agency.................... 51
Section 1003. Money for Securities Payments to Be Held in Trust.. 51
Section 1004. Limitation on Liens................................ 52
Section 1005. Statement by Officers as to Default................ 54
Section 1006. Waiver of Certain Covenants........................ 55
Section 1007. Calculation of Original Issue Discount............. 55
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article........................... 56
Section 1102. Election to Redeem; Notice to Trustee.............. 56
Section 1103. Selection by Trustee of Securities to Be Redeemed.. 56
Section 1104. Notice of Redemption............................... 57
Section 1105. Securities Payable on Redemption Date.............. 58
Section 1106. Securities Redeemed in Part........................ 58
(iii)
<PAGE>
ARTICLE TWELVE
PAGE
----
Sinking Funds
Section 1201. Applicability of Article........................... 59
Section 1202. Satisfaction of Sinking Fund Payments with
Securities......................................... 59
Section 1203. Redemption of Securities for Sinking Fund.......... 59
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Applicability of Article........................... 60
Section 1302. Defeasance and Discharge........................... 60
Section 1303. Covenant Defeasance................................ 61
Section 1304. Conditions to Defeasance or Covenant Defeasance.... 61
Section 1305. Deposited Money and Government Obligations to Be
Held in Trust; Miscellaneous Provisions............ 62
ARTICLE FOURTEEN
Immunity of Incorporators, Stockholders, Officers and Directors
Section 1401. Indenture and Securities Solely Corporate
Obligations........................................ 63
Testimonium.......................................................... 64
Signatures and Seals................................................. 64
(iv)
<PAGE>
INDENTURE, dated as of April 1, 1998, between Duke Capital
Corporation, a corporation duly organized and existing under the laws of the
State of Delaware (herein called the "Corporation"), having its principal
office at 422 South Church Street, Charlotte, North Carolina 28202, and The
Chase Manhattan Bank, a New York banking corporation, as Trustee (herein called
the "Trustee").
RECITALS OF THE CORPORATION
The Corporation has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
senior debentures, notes or other evidences of indebtedness (herein called
the "Securities"), to be issued in one or more series as in this Indenture
provided.
All things necessary to make this Indenture a valid agreement of the
Corporation, in accordance with its terms, have been done.
Now, Therefore, This Indenture Witnesseth:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles, and, except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect to any computation
required or permitted hereunder shall mean such accounting principles as
are generally accepted in the United States of America;
(4) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may
be, of this Indenture; and
<PAGE>
(5) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"Act," when used with respect to any Holder, has the meaning specified
in Section 104.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 614 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Board of Directors" means either the board of directors of the
Corporation or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Corporation 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," when used with respect to any Place of Payment, means
a day other than (i) a Saturday or a Sunday, (ii) a day on which banking
institutions in that Place of Payment are authorized or obligated by law or
executive order to remain closed or (iii) a day on which the Corporate Trust
Office of the Trustee is closed for business.
"Commission" means the Securities and Exchange Commission, from time
to time constituted, created under the Exchange Act, or, if at any time after
the execution of this instrument such Commission is not existing and performing
the duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Corporation" means the Person named as the "Corporation" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Corporation" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Corporation by its Chairman of the Board, its
President or a Vice President, and by its Treasurer, an Assistant Treasurer, its
Secretary or an Assistant Secretary, and delivered to the Trustee.
"Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered, which office at the date hereof is located at 450 West 33rd
Street, New York, New York 10001.
2
<PAGE>
"corporation" means a corporation, association, company, joint-stock
company or business trust.
"Covenant Defeasance" has the meaning specified in Section 1303.
"Defaulted Interest" has the meaning specified in Section 307.
"Defeasance" has the meaning specified in Section 1302.
"Depositary" means, with respect to Securities of any series issuable
in whole or in part in the form of one or more Global Securities, a clearing
agency registered under the Exchange Act that is designated to act as Depositary
for such Securities as contemplated by Section 301.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 104.
"Global Security" means a Security that evidences all or part of the
Securities of any series which is issued to a Depositary or a nominee thereof
for such series in accordance with Section 301(17).
"Government Obligation" has the meaning specified in Section 1304.
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indenture" means this instrument as originally executed and as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the terms of particular
series of Securities established as contemplated by Section 301.
"interest," when used with respect to an Original Issue Discount
Security which by its terms bears interest only after Maturity, means interest
payable after Maturity.
"Interest Payment Date," when used with respect to any Security, means
the Stated Maturity of an installment of interest on such Security.
"Investment Company Act" means the Investment Company Act of 1940 and
any statute successor thereto, in each case as amended from time to time.
"Maturity," when used with respect to any Security, means the date on
which the principal of such Security or an installment of principal becomes due
and payable as
3
<PAGE>
therein or herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
"Notice of Default" means a written notice of the kind specified in
Section 501(4).
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, the President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary, of the Corporation, and
delivered to the Trustee. One of the officers signing an Officers' Certificate
given pursuant to Section 1005 shall be the principal executive, financial or
accounting officer of the Corporation.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Corporation, or other counsel who shall be reasonably acceptable
to the Trustee.
"Original Issue Discount Security" means any Security which provides
for an amount less than the principal amount thereof to be due and payable upon
a declaration of acceleration of the Maturity thereof pursuant to Section 502.
"Outstanding," when used with respect to Securities, means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
(1) Securities theretofore cancelled by the Trustee or delivered to
the Trustee for cancellation;
(2) Securities for whose payment or redemption the necessary amount of
money or money's worth has been theretofore deposited with the Trustee or
any Paying Agent (other than the Corporation) in trust or set aside and
segregated in trust by the Corporation (if the Corporation shall act as its
own Paying Agent) for the Holders of such Securities; provided that, if
such Securities are to be redeemed, notice of such redemption has been duly
given pursuant to this Indenture or provision therefor satisfactory to the
Trustee has been made;
(3) Securities as to which Defeasance has been effected pursuant to
Section 1302; and
(4) Securities which have been paid pursuant to Section 306 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands such Securities are valid obligations of the Corporation;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder as of any date, (A) the principal amount of an Original Issue
Discount Security which shall be deemed to be Outstanding shall be the amount of
the principal thereof which would be due and payable as of such date upon
4
<PAGE>
acceleration of the Maturity thereof to such date pursuant to Section 502, (B)
if, as of such date, the principal amount payable at the Stated Maturity of a
Security is not determinable, the principal amount of such Security which shall
be deemed to be Outstanding shall be the amount as specified or determined as
contemplated by Section 301, (C) the principal amount of a Security denominated
in one or more foreign currencies or currency units which shall be deemed to be
Outstanding shall be the U.S. dollar equivalent, determined as of such date in
the manner provided as contemplated by Section 301, of the principal amount of
such Security (or, in the case of a Security described in Clause (A) or (B)
above, of the amount determined as provided in such Clause), and (D) Securities
owned by the Corporation or any other obligor upon the Securities or any
Affiliate of the Corporation or of such other obligor, whether of record or
beneficially, shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent, waiver or other
action, only Securities which the Trustee actually knows to be so owned shall be
so disregarded. Securities so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Corporation or any other obligor upon the Securities or
any Affiliate of the Corporation or of such other obligor.
"Paying Agent" means any Person authorized by the Corporation to pay
the principal of or any premium or interest on any Securities on behalf of the
Corporation.
"Periodic Offering" means an offering of Securities of a series from
time to time the specific terms of which Securities, including without
limitation the rate or rates of interest or formula for determining the rate or
rates of interest thereon, if any, the Stated Maturity or Maturities thereof and
the redemption provisions, if any, with respect thereto, are to be determined by
the Corporation upon the issuance of such Securities.
"Person" means any individual, corporation, partnership, limited
liability company or corporation, joint venture, trust, unincorporated
organization or government or any agency or political subdivision thereof.
"Place of Payment," when used with respect to the Securities of any
series, means the place or places where the principal of and any premium and
interest on the Securities of that series are payable as specified as
contemplated by Section 301.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Principal Property" means any natural gas pipeline, natural gas
gathering system, natural gas storage facility, natural gas processing plant or
other plant or facility located in the United States that in the opinion of the
Board of Directors or management of the Corporation is of material importance to
the business conducted by the Corporation and its consolidated Subsidiaries
taken as whole.
"Principal Subsidiary" means any Subsidiary which owns a Principal
Property.
"Redemption Date," when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price," when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
5
<PAGE>
"Regular Record Date" for the interest payable on any Interest Payment
Date on the Securities of any series means the date specified for that purpose
as contemplated by Section 301.
"Responsible Officer," when used with respect to the Trustee, means
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 secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any senior trust officer, any trust officer or assistant
trust officer, the controller or any assistant controller or any other 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.
"Securities" has the meaning stated in the first recital of this
Indenture and more particularly means any Securities authenticated and delivered
under this Indenture.
"Securities Act" means the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity," when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security as the date on which the principal of such Security or
such installment of principal or interest is due and payable, in the case of
such principal, as such date may be advanced or extended as provided pursuant to
the terms of such Security and this Indenture.
"Subsidiary" means, as to any Person, a corporation of which more than
50% of the outstanding shares of stock having ordinary voting power (other than
stock having such power only by reason of contingency) is at the time owned,
directly or indirectly through one or more intermediaries, or both, by such
Person.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided, however,
that in the event the Trust
6
<PAGE>
Indenture Act of 1939 is amended after such date, "Trust Indenture Act" shall
mean, to the extent required by any such amendment, the Trust Indenture Act of
1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who is then a Trustee hereunder, and
if at any time there is more than one such Person, "Trustee" as used with
respect to the Securities of any series shall mean the Trustee with respect to
Securities of that series.
"Vice President," when used with respect to the Corporation or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president."
Section 102. Compliance Certificates and Opinions.
Upon any application or request by the Corporation to the Trustee to
take any action under any provision of this Indenture, the Corporation shall
furnish to the Trustee such certificates and opinions as may be required under
the Trust Indenture Act. Each such certificate or opinion shall be given in the
form of an Officers' Certificate, if to be given by an officer of the
Corporation, or an Opinion of Counsel, if to be given by counsel, and shall
comply with the requirements of the Trust Indenture Act and any other
requirements set forth in this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
Section 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
7
<PAGE>
Any certificate or opinion of an officer of the Corporation may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Corporation stating that the
information with respect to such factual matters is in the possession of the
Corporation, unless such counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever, subsequent to the receipt by the Trustee of any Board
Resolution, Officers' Certificate, Opinion of Counsel or other document or
instrument, a clerical, typographical or other inadvertent or unintentional
error or omission shall be discovered therein, a new document or instrument may
be substituted therefor in corrected form with the same force and effect as if
originally filed in the corrected form and, irrespective of the date or dates of
the actual execution and/or delivery thereof, such substitute document or
instrument shall be deemed to have been executed and/or delivered as of the date
or dates required with respect to the document or instrument for which it is
substituted. Anything in this Indenture to the contrary notwithstanding, if any
such corrective document or instrument indicates that action has been taken by
or at the request of the Corporation which could not have been taken had the
original document or instrument not contained such error or omission, the action
so taken shall not be invalidated or otherwise rendered ineffective but shall be
and remain in full force and effect, except to the extent that such action was a
result of willful misconduct or bad faith. Without limiting the generality of
the foregoing, any Securities issued under the authority of such defective
document or instrument shall nevertheless be the valid obligations of the
Corporation entitled to the benefits of this Indenture equally and ratably with
all other Outstanding Securities, except as aforesaid.
Section 104. Acts of Holders; Record Dates.
Any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Indenture to be given, made or
taken by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Corporation.
Such instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the Trustee and
the Corporation, if made in the manner provided in this Section.
8
<PAGE>
The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is
by a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
The ownership of Securities shall be proved by the Security Register.
Any request, demand, authorization, direction, notice, consent, waiver or
other Act of the Holder of any Security shall bind every future Holder of the
same Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Corporation
in reliance thereon, whether or not notation of such action is made upon such
Security.
The Corporation may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Securities of such series; provided that the
Corporation may not set a record date for, and the provisions of this paragraph
shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in the next paragraph. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other Holders,
shall be entitled to take or revoke the relevant action, whether or not such
Holders remain Holders after such record date; provided that no such action
shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Corporation from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Corporation, at its own expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Trustee in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 106.
The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to join
in the giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 502, (iii) any request to institute
proceedings referred to in Section 507(2) or (iv) any direction referred to in
Section 512, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request
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or direction or to revoke the same, whether or not such Holders remain Holders
after such record date; provided that no such action shall be effective
hereunder unless taken on or prior to the applicable Expiration Date by Holders
of the requisite principal amount of Outstanding Securities of such series on
such record date. Nothing in this paragraph shall be construed to prevent the
Trustee from setting a new record date for any action for which a record date
has previously been set pursuant to this paragraph (whereupon the record date
previously set shall automatically and with no action by any Person be cancelled
and of no effect), and nothing in this paragraph shall be construed to render
ineffective any action taken by Holders of the requisite principal amount of
Outstanding Securities of the relevant series on the date such action is taken.
Promptly after any record date is set pursuant to this paragraph, the Trustee,
at the Corporation's expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration Date to be sent to the
Corporation in writing and to each Holder of Securities of the relevant series
in the manner set forth in Section 106.
With respect to any record date set pursuant to this Section, the
party hereto which sets such record dates may designate any day as the
"Expiration Date" and from time to time may change the Expiration Date to any
earlier or later day; provided that no such change shall be effective unless
notice of the proposed new Expiration Date is given to the other party hereto in
writing, and to each Holder of Securities of the relevant series in the manner
set forth in Section 106, on or prior to the existing Expiration Date. If an
Expiration Date is not designated with respect to any record date set pursuant
to this Section, the party hereto which set such record date shall be deemed to
have initially designated the 180th day after such record date as the Expiration
Date with respect thereto, subject to its right to change the Expiration Date as
provided in this paragraph. Notwithstanding the foregoing, no Expiration Date
shall be later than the 180th day after the applicable record date.
Without limiting the foregoing, a Holder entitled hereunder to take
any action hereunder with regard to any particular Security may do so with
regard to all or any part of the principal amount of such Security or by one or
more duly appointed agents each of which may do so pursuant to such appointment
with regard to all or any part of such principal amount.
Section 105. Notices, Etc., to Trustee and Corporation.
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Corporation shall be
sufficient for every purpose hereunder if made, given, furnished or filed
in writing to or with the Trustee at its Corporate Trust Office, Attention:
Corporate Trustee Administration, or
(2) the Corporation by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to the
Corporation addressed to it at the address of its principal office
specified in the first paragraph of this instrument, Attention: Treasurer,
or at any other address previously furnished in writing to the Trustee by
the Corporation.
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Section 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address as it appears in the Security Register, not later
than the latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice. In any case where notice to Holders
is given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Indenture provides for notice
in any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Trustee, but such filing shall not be a condition precedent to the validity
of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
Section 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act which is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act which may be so modified or excluded, the latter provision shall
be deemed to apply to this Indenture as so modified or to be excluded, as the
case may be.
Section 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Corporation
shall bind its successors and assigns, whether so expressed or not.
Section 110. Separability Clause.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
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Section 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto, their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this Indenture.
Section 112. Governing Law.
This Indenture and the Securities shall be governed by and construed
in accordance with the laws of the State of New York, without regard to
conflicts of laws principles thereof.
Section 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day at any Place of Payment,
then (notwithstanding any other provision of this Indenture or of the Securities
(other than a provision of any Security which specifically states that such
provision shall apply in lieu of this Section)) payment of interest or principal
(and premium, if any) need not be made at such Place of Payment on such date,
but may be made on the next succeeding Business Day at such Place of Payment
with the same force and effect as if made on the Interest Payment Date or
Redemption Date, or at the Stated Maturity.
ARTICLE TWO
Security Forms
Section 201. Forms Generally.
The Securities of each series shall be in substantially the form set
forth in this Article, or in such other form as shall be established by or
pursuant to a Board Resolution or in one or more indentures supplemental hereto,
in each case with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture, and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or Depositary therefor or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution thereof. If the form of Securities of any series is established by
action taken pursuant to a Board Resolution, a copy of an appropriate record of
such action shall be certified by the Secretary or an Assistant Secretary of the
Corporation and delivered to the Trustee at or prior to the delivery of the
Company Order contemplated by Section 303 for the authentication and delivery of
such Securities.
The definitive Securities shall be printed, lithographed or engraved
on steel engraved borders or may be produced in any other manner, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
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Section 202. Form of Face of Security.
[Insert any legend required by the Internal Revenue Code and the
regulations thereunder.]
DUKE CAPITAL CORPORATION
_____________________
No. _________ $ __________
CUSIP No. ____
Duke Capital Corporation, a corporation duly organized and existing
under the laws of the State of Delaware (herein called the "Corporation," 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
_________________________ [if the Security is to bear interest prior to Maturity
and interest payment periods are not extendable, insert - , and to pay interest
thereon from __________ or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, [insert - semi-annually, quarterly,
monthly or other description of the relevant payment period] on [________,
________,] and __________ in each year, commencing _______________, at the rate
of ____% per annum, until the principal hereof is paid or made available for
payment [if applicable, insert - , provided that any principal and premium, and
any such installment of interest, which is overdue shall bear interest at the
rate of ___% per annum (to the extent that the payment of such interest shall be
legally enforceable), from the dates such amounts are due until they are paid or
made available for payment, and such interest shall be payable on demand]. The
interest so payable, and punctually paid or duly provided for, on any Interest
Payment Date will, as provided in such Indenture, be paid to the Person in whose
name this Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest, which shall be
the [___________________] (whether or not a Business Day), as the case may be,
next preceding such Interest Payment Date. Any such interest not so punctually
paid or duly provided for will forthwith cease to be payable to the Holder on
such Regular Record Date and may either be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to Holders of Securities
of this series not less than 10 days prior to such Special Record Date, or be
paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities of this series
may be listed, and upon such notice as may be required by such exchange, all as
more fully provided in said Indenture].
[If the Security is not to bear interest prior to Maturity, insert -
The principal of this Security shall not bear interest except in the case of a
default in payment of principal upon acceleration, upon redemption or at Stated
Maturity and in such case the overdue principal and any overdue premium shall
bear interest at the rate of ____% per annum (to the extent that the payment of
such interest shall be legally enforceable), from the dates such amounts are due
until they are paid or made available for payment. Interest on any overdue
principal or premium shall be payable on demand. Any such interest on overdue
principal or premium which is not paid on demand shall bear interest at the rate
of ____% per annum (to the extent that the payment of such interest on interest
shall be legally enforceable), from the
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date of such demand until the amount so demanded is paid or made available for
payment. Interest on any overdue interest shall be payable on demand.]
Payment of the principal of (and premium, if any) and [if applicable,
insert - any such] interest on this Security will be made at the office or
agency of the Corporation maintained for that purpose in _________________, in
such coin or currency of the United States of America as at the time of payment
is legal tender for payment of public and private debts [if applicable, insert -
; provided, however, that at the option of the Corporation payment of interest
may be made by check mailed to the address of the Person entitled thereto as
such address shall appear in the Security Register or by wire transfer at such
place and to such account at a banking institution in the United States as may
be designated in writing to the Trustee at least sixteen (16) days prior to the
date for payment by the Person entitled thereto].
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Corporation has caused this instrument to be
duly executed under its corporate seal.
Dated: DUKE CAPITAL CORPORATION
By____________________________
Attest:
____________________________
Section 203. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the
Corporation (herein called the "Securities"), issued and to be issued in one or
more series under an Indenture, dated as of April 1, 1998 (herein called the
"Indenture," which term shall have the meaning assigned to it in such
instrument), between the Corporation and The Chase Manhattan Bank, as Trustee
(herein called the "Trustee," which term includes any successor trustee under
the Indenture), and reference is hereby made to the Indenture for a statement of
the respective rights, limitation of rights, duties and immunities thereunder of
the Corporation, the Trustee and the Holders of the Securities and of the terms
upon which the Securities are, and are to be, authenticated and delivered. This
Security is one of the series designated on the face hereof [if applicable,
insert - , limited in aggregate principal amount to $__________].
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[If applicable, insert - The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, [if applicable, insert -
(1) on ____________ in any year commencing with the year _____ and ending with
the year _____ through operation of the sinking fund for this series at a
Redemption Price equal to 100% of the principal amount, and (2)] at any time [if
applicable, insert - on or after ___________, 19__], as a whole or in part, at
the election of the Corporation, at the following Redemption Prices (expressed
as percentages of the principal amount): If redeemed [if applicable, insert - on
or before _________________, ___%, and if redeemed] during the 12-month period
beginning _________ of the years indicated,
Year Redemption Price Year Redemption Price
------ ---------------- ---- ----------------
and thereafter at a Redemption Price equal to ____% of the principal amount,
together in the case of any such redemption [if applicable, insert - (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest installments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.]
[If applicable, insert - The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, (1) on ____________ in
any year commencing with the year ______ and ending with the year _____ through
operation of the sinking fund for this series at the Redemption Prices for
redemption through operation of the sinking fund (expressed as percentages of
the principal amount) set forth in the table below, and (2) at any time [if
applicable, insert - on or after _____________], as a whole or in part, at the
election of the Corporation, at the Redemption Prices for redemption otherwise
than through operation of the sinking fund (expressed as percentages of the
principal amount) set forth in the table below: If redeemed during the 12-month
period beginning ________ of the years indicated,
Redemption Price
for Redemption Price for
Redemption Through Redemption Otherwise Than
Operation of the Through Operation
Year Sinking Fund of the Sinking Fund
------ -------------------- --------------------------
and thereafter at a Redemption Price equal to _____% of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest installments whose Stated Maturity is on
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or prior to such Redemption Date will be payable to the Holders of such
Securities, or one or more Predecessor Securities, of record at the close of
business on the relevant Record Dates referred to on the face hereof, all as
provided in the Indenture.]
[If applicable, insert - Notwithstanding the foregoing, the
Corporation may not, prior to _________, redeem any Securities of this series as
contemplated by [if applicable, insert - Clause (2) of] the preceding paragraph
as a part of, or in anticipation of, any refunding operation by the application,
directly or indirectly, of moneys borrowed having an interest cost to the
Corporation (calculated in accordance with generally accepted financial
practice) of less than ____% per annum.]
[If applicable, insert - The sinking fund for this series provides
for the redemption on __________ in each year beginning with the year _______
and ending with the year ______ of [if applicable, insert - not less than
$___________ ("mandatory sinking fund") and not more than] $____________
aggregate principal amount of Securities of this series. Securities of this
series acquired or redeemed by the Corporation otherwise than through [if
applicable, insert - mandatory] sinking fund payments may be credited against
subsequent [if applicable, insert - mandatory] sinking fund payments otherwise
required to be made [if applicable, insert - , in the inverse order in which
they become due].]
[If the Security is subject to redemption of any kind, insert - In
the event of redemption of this Security in part only, a new Security or
Securities of this series and of like tenor for the unredeemed portion hereof
will be issued in the name of the Holder hereof upon the cancellation hereof.]
[If applicable, insert - The Indenture contains provisions for
defeasance at any time of [the entire indebtedness of this Security] [or]
[certain restrictive covenants and Events of Default with respect to this
Security] [, in each case] upon compliance with certain conditions set forth in
the Indenture.]
[If the Security is not an Original Issue Discount Security, insert -
If an Event of Default with respect to Securities of this series shall occur and
be continuing, the principal of the Securities of this series may be declared
due and payable in the manner and with the effect provided in the Indenture.]
[If the Security is an Original Issue Discount Security, insert - If
an Event of Default with respect to Securities of this series shall occur and be
continuing, an amount of principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to [insert formula for determining the
amount]. Upon payment (i) of the amount of principal so declared due and
payable and (ii) of interest on any overdue principal, premium and interest (in
each case to the extent that the payment of such interest shall be legally
enforceable), all of the Corporation's obligations in respect of the payment of
the principal of and premium and interest, if any, on the Securities of this
series shall terminate.]
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The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Corporation and the rights of the Holders of the Securities of all series
affected under the Indenture at any time by the Corporation and the Trustee with
the consent of the Holders of a majority in principal amount of the Securities
of all series at the time Outstanding affected thereby (voting as one class).
The Indenture contains provisions permitting the Holders of not less than a
majority in principal amount of the Securities of all series at the time
Outstanding with respect to which a default under the Indenture shall have
occurred and be continuing (voting as one class), on behalf of the Holders of
the Securities of all such series, to waive, with certain exceptions, such past
default with respect to all such series and its consequences. The Indenture
also permits the Holders of not less than a majority in principal amount of the
Securities of each series at the time Outstanding, on behalf of the Holders of
all Securities of such series, to waive compliance by the Corporation with
certain provisions of the Indenture. Any such consent or waiver by the Holder
of this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange therefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder unless such Holder shall have previously given
the Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than a majority in principal
amount of the Securities of this series at the time Outstanding shall have made
written request to the Trustee to institute proceedings in respect of such Event
of Default as Trustee and offered the Trustee reasonable indemnity, and the
Trustee shall not have received from the Holders of a majority in principal
amount of Securities of this series at the time Outstanding a direction
inconsistent with such request, and shall have failed to institute any such
proceeding, for 60 days after receipt of such notice, request and offer of
indemnity. The foregoing shall not apply to any suit instituted by the Holder
of this Security for the enforcement of any payment of principal hereof or any
premium or interest hereon on or after the respective due dates expressed
herein.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Corporation,
which is absolute and unconditional, to pay the principal of and any premium and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Corporation in any place where the principal of and any
premium and interest on this Security are payable, duly
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<PAGE>
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Corporation and the Security Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Securities of this series and of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $1,000 and any integral multiple thereof.
As provided in the Indenture and subject to certain limitations therein set
forth, Securities of this series are exchangeable for a like aggregate principal
amount of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Corporation may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Corporation, the Trustee and any agent of the Corporation or the
Trustee may treat the Person in whose name this Security is registered as the
owner hereof for all purposes, whether or not this Security be overdue, and
neither the Corporation, the Trustee nor any such agent shall be affected by
notice to the contrary.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
Section 204. Form of Legend for Global Securities.
Unless otherwise specified as contemplated by Section 301 for the
Securities evidenced thereby, every Global Security authenticated and delivered
hereunder shall bear a legend in substantially the following form:
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 THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE
REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE
THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
Section 205. Form of Trustee's Certificate of Authentication.
The Trustee's certificate of authentication shall be in substantially
the following form:
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This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
THE CHASE MANHATTAN BANK,
As Trustee
By:____________________________
Authorized Officer
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ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to Section 303,
set forth, or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities of any series,
(1) the title of the Securities of the series (which shall distinguish
the Securities of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the Securities of
the series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Section 304, 305, 306, 906 or 1106 and except for any
Securities which, pursuant to Section 303, are deemed never to have been
authenticated and delivered hereunder);
(3) the Person to whom any interest on a Security of the series shall
be payable, if other than the Person in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest;
(4) the date or dates on which the principal of any Securities of the
series is payable or the method by which such date shall be determined and
the right, if any, to shorten or extend the date on which the principal of
any Securities of the series is payable and the conditions to any such
change;
(5) the rate or rates at which any Securities of the series shall bear
interest, if any, or the method by which such rate or rates shall be
determined; the date or dates from which any such interest shall accrue;
the Interest Payment Dates on which any such interest shall be payable; the
manner (if any) of determination of such Interest Payment Dates; and the
Regular Record Date, if any, for any such interest payable on any Interest
Payment Date;
(6) the right, if any, to extend the interest payment periods and the
terms of such extension or extensions;
(7) the place or places where the principal of and any premium and
interest on any Securities of the series shall be payable and whether, if
acceptable to the
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Trustee, any principal of such Securities shall be payable without
presentation or surrender thereof;
(8) the period or periods within which, or the date or dates on which,
the price or prices at which and the terms and conditions upon which any
Securities of the series may be redeemed, in whole or in part, at the
option of the Corporation and, if other than by a Board Resolution, the
manner in which any election by the Corporation to redeem the Securities
shall be evidenced;
(9) the obligation, if any, of the Corporation to redeem or purchase
any Securities of the series pursuant to any sinking fund, purchase fund or
analogous provisions or at the option of the Holder thereof and the period
or periods within which, the price or prices at which and the terms and
conditions upon which any Securities of the series shall be redeemed or
purchased, in whole or in part, pursuant to such obligation;
(10) if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which any Securities of the series shall be
issuable;
(11) if the amount of principal of or any premium or interest on any
Securities of the series may be determined with reference to an index or
pursuant to a formula, the manner in which such amounts shall be
determined;
(12) if other than the currency of the United States of America, the
currency, currencies or currency units in which the principal of or any
premium or interest on any Securities of the series shall be payable and
the manner of determining the equivalent thereof in the currency of the
United States of America for any purpose, including for purposes of the
definition of "Outstanding" in Section 101;
(13) if the principal of or any premium or interest on any Securities
of the series is to be payable, at the election of the Corporation or the
Holder thereof, in one or more currencies or currency units other than
that or those in which such Securities are stated to be payable, the
currency, currencies or currency units in which the principal of or any
premium or interest on such Securities as to which such election is made
shall be payable, the periods within which and the terms and conditions
upon which such election is to be made and the amount so payable (or the
manner in which such amount shall be determined);
(14) if other than the entire principal amount thereof, the portion of
the principal amount of any Securities of the series which shall be payable
upon declaration of acceleration of the Maturity thereof pursuant to
Section 502;
(15) if the principal amount payable at the Stated Maturity of any
Securities of the series will not be determinable as of any one or more
dates prior to the Stated Maturity, the amount which shall be deemed to be
the principal amount of such Securities as of any such date for any purpose
thereunder or hereunder, including the principal amount thereof which shall
be due and payable upon any Maturity other than the Stated Maturity or
which shall be deemed to be Outstanding as of any date prior to
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the Stated Maturity (or, in any such case, the manner in which such amount
deemed to be the principal amount shall be determined);
(16) if either or both of Sections 1302 and 1303 do not apply to any
Securities of the series;
(17) if applicable, that any Securities of the series shall be
issuable in whole or in part in the form of one or more Global Securities
and, in such case, the respective Depositary or Depositaries for such
Global Securities, the form of any legend or legends which shall be borne
by any such Global Security in addition to or in lieu of that set forth in
Section 204 and any circumstances in addition to or in lieu of those set
forth in Clause (2) of the last paragraph of Section 305 in which any such
Global Security may be exchanged in whole or in part for Securities
registered, and any transfer of such Global Security in whole or in part
may be registered, in the name or names of Persons other than the
Depositary for such Global Security or a nominee thereof;
(18) any addition, modification or deletion of any Events of Default
or covenants provided with respect to any Securities of the series and any
change in the right of the Trustee or the requisite Holders of such
Securities to declare the principal amount thereof due and payable pursuant
to Section 502;
(19) any addition to or change in the covenants set forth in Article
Ten which applies to Securities of the series; and
(20) any other terms of the series.
All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided in or pursuant
to the Board Resolution referred to above and (subject to Section 303) set
forth, or determined in the manner provided, in the Officers' Certificate
referred to above or in any such indenture supplemental hereto.
If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such action
shall be certified by the Secretary or an Assistant Secretary of the Corporation
and delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms or the manner of determining the terms of
the series.
With respect to Securities of a series offered in a Periodic Offering,
the Board Resolution (or action taken pursuant thereto), Officers' Certificate
or supplemental indenture referred to above may provide general terms or
parameters for Securities of such series and provide either that the specific
terms of particular Securities of such series shall be specified in a Company
Order or that such terms shall be determined by the Corporation in accordance
with other procedures specified in a Company Order as contemplated by the third
paragraph of Section 303.
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Notwithstanding Section 301(2) herein and unless otherwise expressly
provided with respect to a series of Securities, the aggregate principal amount
of a series of Securities may be increased and additional Securities of such
series may be issued up to the maximum aggregate principal amount authorized
with respect to such series as increased.
Section 302. Denominations.
The Securities of each series shall be issuable only in fully
registered form without coupons and only in such denominations as shall be
specified as contemplated by Section 301. In the absence of any such specified
denomination with respect to the Securities of any series, the Securities of
such series shall be issuable in denominations of $1,000 and any integral
multiple thereof.
Section 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Corporation by its
Chairman of the Board, its Vice Chairman of the Board, its President or one of
its Vice Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Corporation shall bind the
Corporation, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of
this Indenture, the Corporation may deliver Securities of any series executed by
the Corporation to the Trustee for authentication, together with a Company Order
for the authentication and delivery of such Securities, and the Trustee in
accordance with the Company Order shall authenticate and deliver such
Securities, provided, however, that in the case of Securities offered in a
Periodic Offering, the Trustee shall authenticate and deliver such Securities
from time to time in accordance with such other procedures (including, without
limitation, the receipt by the Trustee of oral or electronic instructions from
the Corporation or its duly authorized agents, promptly confirmed in writing)
acceptable to the Trustee as may be specified by or pursuant to a Company Order
delivered to the Trustee prior to the time of the first authentication of
Securities of such series. If the form or terms of the Securities of the series
have been established by or pursuant to one or more Board Resolutions as
permitted by Sections 201 and 301, in authenticating such Securities, and
accepting the additional responsibilities under this Indenture in relation to
such Securities, the Trustee shall be entitled to receive, and (subject to
Section 601) shall be fully protected in relying upon, an Opinion of Counsel
stating,
(1) if the form of such Securities has been established by or pursuant
to Board Resolution as permitted by Section 201, that such form has been
established in conformity with the provisions of this Indenture;
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(2) if the terms of such Securities have been, or in the case of
Securities of a series offered in a Periodic Offering, will be, established
by or pursuant to Board Resolution as permitted by Section 301, that such
terms have been, or in the case of Securities of a series offered in a
Periodic Offering, will be, established in conformity with the provisions
of this Indenture, subject, in the case of Securities of a series offered
in a Periodic Offering, to any conditions specified in such Opinion of
Counsel; and
(3) that such Securities, when authenticated and delivered by the
Trustee and issued by the Corporation in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Corporation enforceable in accordance
with their terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the preceding
paragraph, if all Securities of a series are not to be originally issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 301 or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the
authentication of each Security of such series if such documents are delivered
at or prior to the authentication upon original issuance of the first Security
of such series to be issued.
With respect to Securities of a series offered in a Periodic Offering,
the Trustee may rely, as to the authorization by the Corporation of any of such
Securities, the form and terms thereof and the legality, validity, binding
effect and enforceability thereof, upon the Opinion of Counsel and the other
documents delivered pursuant to Sections 201 and 301 and this Section, as
applicable, in connection with the first authentication of Securities of such
series.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature of an authorized officer, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder. Notwithstanding the foregoing, if any Security shall have been
authenticated and delivered hereunder but never issued and sold by the
Corporation, and the Corporation shall deliver such Security to the Trustee for
cancellation as provided in Section 309, for all purposes of this Indenture such
Security shall be deemed never to have been authenticated and delivered
hereunder and shall never be entitled to the benefits of this Indenture.
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Section 304. Temporary Securities.
Pending the preparation of definitive Securities of any series, the
Corporation may execute, and upon Company Order the Trustee shall authenticate
and deliver, temporary Securities which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Corporation will
cause definitive Securities of that series to be prepared without unreasonable
delay. After the preparation of definitive Securities of such series, the
temporary Securities of such series shall be exchangeable for definitive
Securities of such series upon surrender of the temporary Securities of such
series at the office or agency of the Corporation in a Place of Payment for that
series, without charge to the Holder. Upon surrender for cancellation of any
one or more temporary Securities of any series, the Corporation shall execute
and the Trustee shall authenticate and deliver in exchange therefor one or more
definitive Securities of the same series, of any authorized denominations and of
like tenor and aggregate principal amount. Until so exchanged, the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of such series and tenor.
Section 305. Registration, Registration of Transfer and Exchange.
The Corporation shall cause to be kept at the Corporate Trust Office
of the Trustee a register (the register maintained in such office or in any
other office or agency of the Corporation in a Place of Payment being herein
sometimes referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Corporation shall provide for
the registration of Securities and of transfers of Securities. The Trustee is
hereby appointed "Security Registrar" for the purpose of registering Securities
and transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security of a
series at the office or agency of the Corporation in a Place of Payment for that
series, the Corporation shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Securities of the same series, of any authorized denominations and of like
tenor and 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
like tenor and 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 Corporation shall execute, and the Trustee shall
authenticate and deliver, the Securities which the Holder making the exchange is
entitled to receive.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Corporation, evidencing the
same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
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Every Security presented or surrendered for registration of transfer
or for exchange shall (if so required by the Corporation or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Corporation and the Security Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Corporation may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities, other
than exchanges pursuant to Section 304, 906 or 1106 not involving any transfer.
If the Securities of any series (or of any series and specified tenor)
are to be redeemed, the Corporation shall not be required (A) to issue, register
the transfer of or exchange any Securities of that series (or of that series and
specified tenor, as the case may be) during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of any
such Securities selected for redemption and ending at the close of business on
the day of such mailing, or (B) to 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.
The provisions of Clauses (1), (2), (3) and (4) below shall apply only
to Global Securities:
(1) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depositary designated for such Global
Security or a nominee thereof and delivered to such Depositary or a nominee
thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.
(2) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered,
and no transfer of a Global Security in whole or in part may be registered,
in the name of any Person other than the Depositary for such Global
Security or a nominee thereof unless (A) such Depositary has notified the
Corporation that it is unwilling or unable to continue as Depositary for
such Global Security and a successor Depositary has not been appointed by
the Corporation within 90 days of receipt by the Corporation of such
notification, (B) if at any time the Depositary ceases to be a clearing
agency registered under the Exchange Act at a time when the Depositary is
required to be so registered to act as such Depositary and no successor
Depositary shall have been appointed by the Corporation within 90 days
after it became aware of such cessation, or (C) there shall exist such
circumstances, if any, in addition to or in lieu of the foregoing as have
been specified for this purpose as contemplated by Section 301.
Notwithstanding the foregoing, the Corporation may at any time in its sole
discretion determine that Securities issued in the form of a Global
Security shall no longer be represented in whole or in part by such Global
Security, and the Trustee, upon receipt of a Company Order therefor, shall
authenticate and deliver definitive Securities in exchange in whole or in
part for such Global Security.
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(3) Subject to Clause (2) above, any exchange or transfer of a Global
Security for other Securities may be made in whole or in part, and all
Securities issued in exchange for or upon transfer of a Global Security or
any portion thereof shall be registered in such names as the Depositary for
such Global Security shall direct.
(4) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any
portion thereof, whether pursuant to this Section, Section 304, 306, 906 or
1106 or otherwise, shall be authenticated and delivered in the form of, and
shall be, a Global Security, unless such Security is registered in the name
of a Person other than the Depositary for such Global Security or a nominee
thereof.
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the
Corporation shall execute and the Trustee shall authenticate and deliver in
exchange therefor a new Security of the same series and of like tenor and
principal amount and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Corporation and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Corporation or the Trustee that such Security has been acquired by a bona
fide purchaser, the Corporation shall execute and the Trustee shall authenticate
and deliver, in lieu of any such destroyed, lost or stolen Security, a new
Security of the same series and of like tenor and principal amount and bearing a
number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Corporation in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Corporation may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Corporation, whether or not the
destroyed, lost or stolen Security shall be at any time enforceable by anyone,
and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Securities of that series duly issued
hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
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Section 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301 with
respect to any series of Securities, interest on any Security which is payable,
and is punctually paid or duly provided for, on any Interest Payment Date shall
be paid to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest.
Except as otherwise provided as contemplated by Section 301 with
respect to any series of Securities, any interest on any Security of any series
which is payable, but is not punctually paid or duly provided for, on any
Interest Payment Date (herein called "Defaulted Interest") shall forthwith cease
to be payable to the Holder on the relevant Regular Record Date by virtue of
having been such Holder, and such Defaulted Interest may be paid by the
Corporation, at its election in each case, as provided in Clause (1) or (2)
below:
(1) The Corporation may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities of such series (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 Corporation
shall notify the Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each Security of such series and the date of the
proposed payment, and at the same time the Corporation shall deposit with
the Trustee an amount of money equal to the aggregate amount proposed to be
paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this
Clause provided. Thereupon the Trustee shall fix a Special Record Date for
the payment of such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Corporation of
such Special Record Date and, in the name and at the expense of the
Corporation, shall cause notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor to be given to each Holder of
Securities of such series in the manner set forth in Section 106, not less
than 10 days prior to such Special Record Date. Notice of the proposed
payment of such Defaulted Interest and the Special Record Date therefor
having been so mailed, such Defaulted Interest shall be paid to the Persons
in whose names the Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on such
Special Record Date and shall no longer be payable pursuant to the
following Clause (2).
(2) The Corporation may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with
the requirements of any securities exchange, if any, on which such
Securities may be listed, and upon such notice as may be required by such
exchange, if, after notice given by the Corporation to the Trustee of the
proposed payment pursuant to this Clause, such manner of payment shall be
deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other
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Security shall carry the rights to interest accrued and unpaid, and to accrue,
which were carried by such other Security.
Section 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer,
the Corporation, the Trustee and any agent of the Corporation or the Trustee may
treat the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal of and any premium
and (subject to Section 307) any interest on such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Corporation, the Trustee nor any agent of the Corporation or the Trustee shall
be affected by notice to the contrary.
Section 309. Cancellation.
All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly cancelled by it. The Corporation may at any time deliver
to the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Corporation may have acquired in any manner
whatsoever, and may deliver to the Trustee (or to any other Person for delivery
to the Trustee) for cancellation any Securities previously authenticated
hereunder which the Corporation has not issued and sold, and all Securities so
delivered shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as provided
in this Section, except as expressly permitted by this Indenture. All cancelled
Securities held by the Trustee shall be disposed of as directed by a Company
Order; provided, however, that the Trustee shall not be required to destroy such
cancelled Securities.
Section 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for
Securities of any series, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.
Section 311. CUSIP Numbers.
The Corporation in issuing the Securities may use "CUSIP" numbers (if
then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in
notices of redemption as a convenience to Holders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers.
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ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further
effect (except as to any surviving rights of registration of transfer or
exchange of Securities herein expressly provided for), and the Trustee, at the
expense of the Corporation, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other
than (i) Securities which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section 306 and (ii)
Securities for whose payment money has theretofore been deposited in
trust or segregated and held in trust by the Corporation and
thereafter repaid to the Corporation or discharged from such trust, as
provided in Section 1003) have been delivered to the Trustee for
cancellation; or
(B) all such Securities not theretofore delivered to the Trustee
for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity
within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice
of redemption by the Trustee in the name, and at the expense, of
the Corporation,
and the Corporation, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust funds in
trust for the purpose (I) money in an amount, (II) Government
Obligations (as defined in Section 1304) which through the scheduled
payment of principal and interest in respect thereof in accordance
with their terms will provide, not later than the due date of any
payment, money in an amount, or (III) a combination thereof,
sufficient, in the case of (II) or (III), in the opinion of a
nationally recognized firm of independent public accountants expressed
in a written certification thereof delivered to the Trustee, to pay
and discharge, and which shall be applied by the Trustee to pay and
discharge, the entire indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation, for principal and any
premium and interest to the date of such deposit (in the case of
Securities which have become due and payable) or to the Stated
Maturity or Redemption Date, as the case may be;
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(2) the Corporation has paid or caused to be paid all other sums
payable hereunder by the Corporation; and
(3) the Corporation has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of
this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Corporation to the Trustee under Section 607, the obligations
of the Corporation to any Authenticating Agent under Section 614 and, if money
shall have been deposited with the Trustee pursuant to subclause (B) of Clause
(1) of this Section, the obligations of the Trustee under Section 402 and the
last paragraph of Section 1003 shall survive.
Section 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all
money deposited with the Trustee pursuant to Section 401 shall be held in trust
and applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Corporation acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
ARTICLE FIVE
Remedies
Section 501. Events of Default.
"Event of Default," wherever used herein with respect to Securities of
any series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body),
unless it is inapplicable to a particular series or is specifically deleted or
modified in the Board Resolution (or action taken pursuant thereto), Officers'
Certificate or supplemental indenture under which such series of Securities is
issued or has been deleted or modified in an indenture supplemental hereto:
(1) default in the payment of any interest upon any Security of that
series when it becomes due and payable, and continuance of such default for
a period of 60 days; provided, however, that if the Corporation is
permitted by the terms of the Securities of such series to defer the
payment in question, the date on which such payment is due and payable
shall be the date on which the Corporation is required to make payment
following such deferral, if such deferral has been elected pursuant to the
terms of the Securities; or
(2) default in the payment of the principal of or any premium on any
Security of that series at its Maturity; or
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(3) default in the making of any sinking fund payment, when and as due
by the terms of a Security of that series, and continuance of such default
for a period of 60 days; or
(4) default in the performance, or breach, of any covenant of the
Corporation in this Indenture (other than a covenant a default in whose
performance or whose breach is elsewhere in this Section specifically dealt
with or which has expressly been included in this Indenture solely for the
benefit of series of Securities other than that series), 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 Corporation by the Trustee or to
the Corporation and the Trustee by the Holders of at least 33% in principal
amount of the Outstanding Securities of that series 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, unless the
Trustee, or the Trustee and the Holders of a principal amount of Securities
of such series not less than the principal amount of Securities the Holders
of which gave such notice, as the case may be, shall agree in writing to an
extension of such period prior to its expiration; provided, however, that
the Trustee, or the Trustee and the Holders of such principal amount of
Securities of such series, as the case may be, shall be deemed to have
agreed to an extension of such period if corrective action is initiated by
the Corporation within such period and is being diligently pursued; or
(5) the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Corporation in an involuntary
case or proceeding under any applicable federal or state bankruptcy,
insolvency, reorganization or other similar law or (B) a decree or order
adjudging the Corporation a bankrupt or insolvent, or approving as properly
filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Corporation under any applicable
federal or state law, or appointing a custodian, receiver, liquidator,
assignee, trustee, sequestrator or other similar official of the
Corporation or of any substantial part of its property, or ordering the
winding-up or liquidation of its affairs, and the continuance of any such
decree or order for relief or any such other decree or order unstayed and
in effect for a period of 90 consecutive days; or
(6) the commencement by the Corporation of a voluntary case or
proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to
be adjudicated a bankrupt or insolvent, or the consent by it to the entry
of a decree or order for relief in respect of the Corporation in an
involuntary case or proceeding under any applicable federal or state
bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy or insolvency case or proceeding against it,
or the filing by it of a petition or answer or consent seeking
reorganization or relief under any applicable federal or state law, or the
consent by it to the filing of such petition or to the appointment of or
taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Corporation or of any
substantial part of its property, or the making by it of an assignment for
the benefit of creditors, or the admission by it in writing of its
inability to pay its debts generally as they become due, or the
authorization of any such action by the Board of Directors; or
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(7) any other Event of Default provided with respect to Securities of
that series.
Section 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default with respect to Securities of any series at the
time Outstanding occurs and is continuing, then in every such case the Trustee
or the Holders of not less than 33% in principal amount of the Outstanding
Securities of that series may declare the principal amount of all the Securities
of that series (or, if any Securities of that series are Original Issue Discount
Securities, such portion of the principal amount of such Securities as may be
specified by the terms thereof) to be due and payable immediately, by a notice
in writing to the Corporation (and to the Trustee if given by Holders), and upon
any such declaration such principal amount (or specified amount) shall become
immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Event of Default giving rise to such declaration of
acceleration shall, without further act, be deemed to have been waived, and such
declaration and its consequences shall, without further act, be deemed to have
been rescinded and annulled, if
(1) the Corporation has paid or deposited with the Trustee a sum
sufficient to pay
(A) all overdue interest on all Securities of that series,
(B) the principal of (and premium, if any, on) any Securities of
that series which have become due otherwise than by such declaration
of acceleration and any interest thereon at the rate or rates
prescribed therefor in such Securities,
(C) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate or rates prescribed
therefor in such Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel;
and
(2) all Events of Default with respect to Securities of that series,
other than the non-payment of the principal of Securities of that series
which have become due solely by such declaration of acceleration, have been
cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
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Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Corporation covenants that if
(1) default is made in the payment of any interest on any Security
when such interest becomes due and payable and such default continues for a
period of 60 days, or
(2) default is made in the payment of the principal of (or premium, if
any, on) any Security at the Maturity thereof,
the Corporation will, upon demand of the Trustee, pay to it, for the benefit of
the Holders of such Securities, the whole amount then due and payable on such
Securities for principal and any premium and interest and, to the extent that
payment of such interest shall be legally enforceable, interest on any overdue
principal and premium and on any overdue interest, at the rate or rates
prescribed therefor in such Securities, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series occurs
and is continuing, the Trustee may in its discretion proceed to protect and
enforce its rights and the rights of the Holders of Securities of such series by
such appropriate judicial proceedings as the Trustee shall deem most effectual
to protect and enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exercise of any
power granted herein, or to enforce any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Corporation (or any
other obligor upon the Securities), its property or its creditors, the Trustee
shall be entitled and empowered, by intervention in such proceeding or
otherwise, to take any and all actions authorized under the Trust Indenture Act
in order to have claims of the Holders and the Trustee allowed in any such
proceeding. In particular, the Trustee shall be authorized to collect and
receive any moneys or other property payable or deliverable on any such claims
and to distribute the same; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 607.
No provision of this Indenture shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding; provided,
however, that the Trustee may, on behalf of the Holders, vote for the election
of a trustee in bankruptcy or similar official and be a member of a creditors'
or other similar committee.
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Section 505. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.
Section 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall
be applied in the following order, at the date or dates fixed by the Trustee
and, in case of the distribution of such money on account of principal or any
premium or interest, upon presentation of the Securities and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid:
First: To the payment of all amounts due the Trustee under Section
607;
Second: To the payment of the amounts then due and unpaid for
principal of and any premium and interest on the Securities in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due
and payable on such Securities for principal and any premium and interest,
respectively; and
Third: To the payment of the balance, if any, to the Corporation or
any other Person or Persons legally entitled thereto.
Section 507. Limitation on Suits.
No Holder of any Security of any series shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Indenture,
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless
(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to the Securities of that
series;
(2) the Holders of not less than a majority in principal amount of the
Outstanding Securities of that series shall have made written request to
the Trustee to institute proceedings in respect of such Event of Default in
its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
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(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
Section 508. Unconditional Right of Holders to Receive Principal, Premium and
Interest.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of and any premium and (subject to Section 307)
interest on such Security on the respective Stated Maturities expressed in such
Security (or, in the case of redemption, on the Redemption Date) and to
institute suit for the enforcement of any such payment, and such rights shall
not be impaired without the consent of such Holder.
Section 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Corporation, the Trustee and the Holders
shall be restored severally and respectively to their former positions hereunder
and thereafter all rights and remedies of the Trustee and the Holders shall
continue as though no such proceeding had been instituted.
Section 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in the last paragraph
of Section 306, no right or remedy herein conferred upon or reserved to the
Trustee or to the Holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
Section 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Securities
to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein.
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Every right and remedy given by this Article or by law to the Trustee or to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may be.
Section 512. Control By Holders.
The Holders of a majority in principal amount of the Outstanding
Securities of any series 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, with respect to the
Securities of such series; provided that
(1) such direction shall not be in conflict with any rule of law or
with this Indenture,
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction, and
(3) subject to the provisions of Section 601, the Trustee shall have
the right to decline to follow any such direction if the Trustee in good
faith shall, by a Responsible Officer or Officers of the Trustee, determine
that the proceeding so directed would involve the Trustee in personal
liability.
Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of all series with respect to which any default under the
Indenture shall have occurred and be continuing (voting as one class) may, on
behalf of the Holders of all Securities of all such series, waive such past
default under the Indenture and its consequences, except a default
(1) in the payment of the principal of or any premium or interest on
any Security of such series, or
(2) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of
each Outstanding Security of the series affected.
Upon any such waiver, such default shall cease to exist and be deemed
not to have occurred, and any Event of Default arising therefrom shall be deemed
to have been cured and not to have occurred, for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other default or
impair any right consequent thereon.
Section 514. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, a court may require any party litigant in such suit to
file an undertaking to pay the costs of such suit, and may assess costs against
any such party litigant, in the manner and to the extent provided in the Trust
Indenture Act; provided that neither this Section nor the Trust Indenture
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Act shall be deemed to authorize any court to require such an undertaking or to
make such an assessment in any suit instituted by the Corporation or the
Trustee.
Section 515. Waiver of Stay or Extension Laws.
The Corporation covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, or plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Corporation (to the extent that it
may lawfully do so) hereby expressly waives all benefit or advantage of any such
law and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided by
the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.
Section 602. Notice of Defaults.
If a default occurs hereunder with respect to Securities of any
series, the Trustee shall give the Holders of Securities of such series notice
of such default as and to the extent provided by the Trust Indenture Act;
provided, however, that in the case of any default of the character specified in
Section 501(4) with respect to Securities of such series, no such notice to
Holders shall be given until at least 30 days after the occurrence thereof. For
the purpose of this Section, the term "default" means any event which is, or
after notice or lapse of time or both would become, an Event of Default with
respect to Securities of such series.
Section 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(1) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of
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indebtedness or other paper or document believed by it to be genuine and to
have been signed or presented by the proper party or parties;
(2) any request or direction of the Corporation mentioned herein shall
be sufficiently evidenced by a Company Request or Company Order or as
otherwise expressly provided herein, and any resolution of the Board of
Directors shall be sufficiently evidenced by a Board Resolution;
(3) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officers' Certificate;
(4) the Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(5) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction;
(6) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled, at reasonable times previously notified to the
Corporation, to examine the relevant books, records and premises of the
Corporation, personally or by agent or attorney; and
(7) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder.
Section 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Corporation, and neither the Trustee nor any Authenticating Agent assumes
any responsibility for their correctness. The Trustee makes no representations
as to the validity or sufficiency of this Indenture or of the Securities.
Neither the Trustee nor any Authenticating Agent shall be accountable for the
use or application by the Corporation of Securities or the proceeds thereof.
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Section 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Corporation, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
608 and 613, may otherwise deal with the Corporation with the same rights it
would have if it were not Trustee, Authenticating Agent, Paying Agent, Security
Registrar or such other agent.
Section 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed in writing with the Corporation.
Section 607. Compensation and Reimbursement.
The Corporation agrees
(1) to pay to the Trustee from time to time such compensation as shall
be agreed to in writing between the Corporation and the Trustee for all
services rendered by it hereunder (which compensation shall not be limited
by any provision of law in regard to the compensation of a trustee of an
express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision
of this Indenture (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence, willful
misconduct or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless against, any
loss, liability or expense incurred without negligence, willful misconduct
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 of defending itself against any claim or liability
in connection with the exercise or performance of any of its powers or
duties hereunder.
The Trustee shall have a lien prior to the Securities upon all
property and funds held by it hereunder for any amount owing it or any
predecessor Trustee pursuant to this Section 607, except with respect to funds
held in trust for the benefit of the Holders of particular Securities.
Without limiting any 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 501(5) or Section 501(6), 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.
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The provisions of this Section shall survive the termination of this
Indenture.
Section 608. Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture. To the extent
permitted by such Act, the Trustee shall not be deemed to have a conflicting
interest by virtue of being a trustee under this Indenture with respect to
Securities of more than one series.
Section 609. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder with respect to the
Securities of each series, which may be Trustee hereunder for Securities of one
or more other series. Each Trustee shall be a Person that is eligible pursuant
to the Trust Indenture Act to act as such and has a combined capital and surplus
of at least $50,000,000. If any such Person publishes reports of condition at
least annually, pursuant to law or to the requirements of its supervising or
examining authority, then for the purposes of this Section and to the extent
permitted by the Trust Indenture Act, the combined capital and surplus of such
Person shall be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published. If at any time the Trustee
with respect to the Securities of any series shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article.
Section 610. Resignation and Removal; Appointment of Successor.
No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 611.
The Trustee may resign at any time with respect to the Securities of
one or more series by giving written notice thereof to the Corporation. If the
instrument of acceptance by a successor Trustee required by Section 611 shall
not have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.
The Trustee may be removed at any time with respect to the Securities
of any series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and to the
Corporation.
If at any time:
(1) the Trustee shall fail to comply with Section 608 after written
request therefor by the Corporation or by any Holder who has been a bona
fide Holder of a Security for at least six months, or
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(2) the Trustee shall cease to be eligible under Section 609 and shall
fail to resign after written request therefor by the Corporation or by any
such Holder, or
(3) the Trustee shall become incapable of acting or shall be adjudged
a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (A) the Corporation by a Board Resolution may remove the
Trustee with respect to all Securities, or (B) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, with respect
to the Securities of one or more series, the Corporation, by a Board Resolution,
shall promptly appoint a successor Trustee or Trustees with respect to the
Securities of that or those series (it being understood that any such successor
Trustee may be appointed with respect to the Securities of one or more or all of
such series and that at any time there shall be only one Trustee with respect to
the Securities of any particular series) and shall comply with the applicable
requirements of Section 611. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
with respect to the Securities of any series shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities of such
series delivered to the Corporation and the retiring Trustee, the successor
Trustee so appointed shall, forthwith upon its acceptance of such appointment in
accordance with the applicable requirements of Section 611, become the successor
Trustee with respect to the Securities of such series and to that extent
supersede the successor Trustee appointed by the Corporation. If no successor
Trustee with respect to the Securities of any series shall have been so
appointed by the Corporation or the Holders and accepted appointment in the
manner required by Section 611, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.
The Corporation shall give notice of each resignation and each removal
of the Trustee with respect to the Securities of any series and each appointment
of a successor Trustee with respect to the Securities of any series to all
Holders of Securities of such series in the manner provided in Section 106.
Each notice shall include the name of the successor Trustee with respect to the
Securities of such series and the address of its Corporate Trust Office.
Section 611. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Corporation and to the retiring Trustee
an instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Trustee shall become effective and such successor
Trustee, without any further act, deed or conveyance, shall become vested with
all
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the rights, powers, trusts and duties of the retiring Trustee; but, on the
request of the Corporation or the successor Trustee, such retiring Trustee
shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor Trustee all the rights, powers and trusts of the
retiring Trustee and shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder.
In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Corporation,
the retiring Trustee and each successor Trustee with respect to the Securities
of one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Trustee all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates, (2)
if the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same trust and that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Trustee; and upon the execution and delivery of such supplemental
indenture the resignation or removal of the retiring Trustee shall become
effective to the extent provided therein and each such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates; but, on request of the Corporation or any successor Trustee,
such retiring Trustee shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder with
respect to the Securities of that or those series to which the appointment of
such successor Trustee relates.
Upon request of any such successor Trustee, the Corporation shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred
to in the first or second preceding paragraph, as the case may be.
No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be qualified and eligible under
this Article.
Section 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided that
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
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of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
Section 613. Preferential Collection of Claims Against Corporation.
If and when the Trustee shall be or become a creditor of the
Corporation (or any other obligor upon the Securities), the Trustee shall be
subject to the provisions of the Trust Indenture Act regarding the collection of
claims against the Corporation (or any such other obligor).
Section 614. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents acceptable
to the Corporation with respect to one or more series of Securities which shall
be authorized to act on behalf of the Trustee to authenticate Securities of such
series issued upon exchange, registration of transfer or partial redemption
thereof or pursuant to Section 306, and Securities so authenticated shall be
entitled to the benefits of this Indenture and shall be valid and obligatory for
all purposes as if authenticated by the Trustee hereunder. Wherever reference
is made in this Indenture to the authentication and delivery of Securities by
the Trustee or the Trustee's certificate of authentication, such reference shall
be deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Corporation and shall at all times be a corporation organized
and doing business under the laws of the United States of America, any State
thereof or the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not less than
$50,000,000 and subject to supervision or examination by federal or state
authority. If such Authenticating Agent publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such Authenticating Agent shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, such Authenticating Agent shall
resign immediately in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided that such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Corporation. The Trustee may at any
time terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating
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Agent and to the Corporation. Upon receiving such a notice of resignation or
upon such a termination, or in case at any time such Authenticating Agent shall
cease to be eligible in accordance with the provisions of this Section, the
Trustee may appoint a successor Authenticating Agent which shall be acceptable
to the Corporation and shall give notice of such appointment in the manner
provided in Section 106 to all Holders of Securities of the series with respect
to which such Authenticating Agent will serve. Any successor Authenticating
Agent upon acceptance of its appointment hereunder shall become vested with all
the rights, powers and duties of its predecessor hereunder, with like effect as
if originally named as an Authenticating Agent. No successor Authenticating
Agent shall be appointed unless eligible under the provisions of this Section.
The Corporation agrees to pay to each Authenticating Agent from time
to time reasonable compensation for its services under this Section.
If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternative
certificate of authentication in the following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
THE CHASE MANHATTAN BANK,
As Trustee
By:_____________________________
As Authenticating Agent
By:_____________________________
Authorized Officer
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ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Corporation
Section 701. Corporation to Furnish Trustee Names and Addresses of Holders.
The Corporation will furnish or cause to be furnished to the Trustee
(1) 15 days after each Regular Record Date, a list, in such form as
the Trustee may reasonably require, of the names and addresses of the
Holders of Securities of each series as of such Regular Record Date, and
(2) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Corporation of any such request, a list of
similar form and content as of a date not more than 15 days prior to the
time such list is furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
Section 702. Preservation of Information; Communications to Holders.
The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 701 upon receipt of a new list so furnished.
The rights of Holders to communicate with other Holders with respect
to their rights under this Indenture or under the Securities, and the
corresponding rights and privileges of the Trustee, shall be as provided by the
Trust Indenture Act.
Every Holder of Securities, by receiving and holding the same, agrees
with the Corporation and the Trustee that neither the Corporation nor the
Trustee nor any agent of either of them shall be held accountable by reason of
any disclosure of information as to names and addresses of Holders made pursuant
to the Trust Indenture Act.
Section 703. Reports by Trustee.
The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.
If required by Section 313(a) of the Trust Indenture Act, the Trustee shall,
within 60 days after each October 1 following the date of this Indenture,
deliver to Holders a brief report, dated as of such October 1, which complies
with the provisions of such Section 313(a).
A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed, with the Commission and with the Corporation. The
Corporation will promptly notify the Trustee when any Securities are listed on
any stock exchange.
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Section 704. Reports by Corporation.
The Corporation shall file with the Trustee and the Commission, and
transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant to such Act; provided that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Exchange Act shall be filed with the
Trustee within 15 days after the same is so required to be filed with the
Commission.
ARTICLE EIGHT
Consolidation, Merger, Conveyance or Transfer
Section 801. Corporation 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 Corporation with or into any other
Person or Persons (whether or not affiliated with the Corporation), or
successive consolidations or mergers in which the Corporation or its successor
or successors shall be a party or parties, or shall prevent any conveyance or
transfer of the properties and assets of the Corporation as an entirety or
substantially as an entirety to any other Person (whether or not affiliated with
the Corporation) lawfully entitled to acquire the same; provided, however, and
the Corporation hereby covenants and agrees, that upon any such consolidation,
merger, conveyance or transfer, (i) the due and punctual payment of the
principal of and premium, if any, and interest on all of the Securities,
according to their tenor, and the due and punctual performance and observance of
all of the covenants and conditions of this Indenture to be performed by the
Corporation, shall be expressly assumed, by indenture supplemental hereto, in
form reasonably satisfactory to the Trustee, executed and delivered to the
Trustee by the Person (if other than the Corporation) formed by such
consolidation, or into which the Corporation shall have been merged, or by the
Person which shall have acquired such properties and assets, and (ii) the
Corporation shall deliver to the Trustee an Officers' Certificate and an Opinion
of Counsel, each stating that such consolidation, merger, conveyance or transfer
and, if a supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with this Article and that all
conditions precedent herein provided for relating to such transaction have been
complied with.
Section 802. Successor Substituted.
Upon any consolidation of the Corporation with, or merger of the
Corporation into, any other Person or any conveyance or transfer of the
properties and assets of the Corporation as an entirety or substantially as an
entirety in accordance with Section 801, the successor Person formed by such
consolidation or into which the Corporation is merged or to which such
conveyance or transfer is made shall succeed to, and be substituted for, and may
exercise every right and power of, the Corporation under this Indenture with the
same effect as if such successor Person had been named as the Corporation
herein, and thereafter the predecessor Person shall be relieved of all
obligations and covenants under this Indenture and the Securities.
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ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Corporation, when authorized
by a Board Resolution, and the Trustee, at any time and from time to time, may
enter into one or more indentures supplemental hereto, in form reasonably
satisfactory to the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Corporation
and the assumption by any such successor of the covenants of the
Corporation herein and in the Securities; or
(2) to add to the covenants of the Corporation for the benefit of the
Holders of all or any series of Securities (and if such covenants are to be
for the benefit of less than all series of Securities, stating that such
covenants are expressly being included solely for the benefit of such
series) or to surrender any right or power herein conferred upon the
Corporation; or
(3) to add any additional Events of Default for the benefit of the
Holders of all or any series of Securities (and if such additional Events
of Default are to be for the benefit of less than all series of Securities,
stating that such additional Events of Default are expressly being included
solely for the benefit of such series); or
(4) to add to or change any of the provisions of this Indenture to
such extent as shall be necessary to permit or facilitate the issuance of
Securities in bearer form, registrable or not registrable as to principal,
and with or without interest coupons, or to facilitate the issuance of
Securities in uncertificated form; or
(5) to add to, change or eliminate any of the provisions of this
Indenture in respect of one or more series of Securities; provided that any
such addition, change or elimination (A) shall neither (i) apply to any
Security of any series created prior to the execution of such supplemental
indenture and entitled to the benefit of such provision nor (ii) modify the
rights of the Holder of any such Security with respect to such provision or
(B) shall become effective only when there is no such Security Outstanding;
or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any series as
permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this Indenture
as shall be necessary to provide for
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or facilitate the administration of the trusts hereunder by more than one
Trustee, pursuant to the requirements of Section 611; or
(9) to cure any ambiguity, to correct or supplement any provision
herein which may be defective or inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture; provided that such action pursuant
to this Clause (9) shall not adversely affect the interests of the Holders
of Securities of any series in any material respect.
Section 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of all series affected by such
supplemental indenture (voting as one class), by Act of said Holders delivered
to the Corporation and the Trustee, the Corporation, when authorized by a Board
Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of any
supplemental indenture, or modifying in any manner the rights of the Holders of
Securities under this Indenture; provided, however, that no such supplemental
indenture shall, without the consent of the Holder of each Outstanding Security
affected thereby,
(1) change the Stated Maturity of the principal of, or any installment
of principal of or interest on, any Security, or reduce the principal
amount thereof or the rate of interest thereon or any premium payable upon
the redemption thereof, or reduce the amount of the principal of an
Original Issue Discount Security or any other Security which would be due
and payable upon a declaration of acceleration of the Maturity thereof
pursuant to Section 502 or change the coin or currency in which any
Security or any premium or interest thereon is payable, or impair the right
to institute suit for the enforcement of any such payment on or after the
Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date), or
(2) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of whose Holders is required for any
such supplemental indenture, or the consent of whose Holders is required
for any waiver (of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences) provided for in this
Indenture, or
(3) modify any of the provisions of this Section, Section 513 or
Section 1006, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Security affected
thereby; provided, however, that this clause shall not be deemed to require
the consent of any Holder with respect to changes in the references to "the
Trustee" and concomitant changes in this Section and Section 1006, or the
deletion of this proviso, in accordance with the requirements of Sections
611 and 901(8). A supplemental indenture which changes or eliminates any
covenant or other provision of this Indenture which has expressly been
included solely for the benefit of one or more particular series of
Securities, or which modifies the rights of the Holders of Securities of
such series with respect to such covenant or other provision, shall be
deemed not to affect the rights under this Indenture of the Holders of
Securities of any other series.
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It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
Section 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
Section 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
Section 906. Reference in Securities to Supplemental Indentures.
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Corporation
shall so determine, new Securities of any series so modified as to conform, in
the opinion of the Trustee and the Corporation, to any such supplemental
indenture may be prepared and executed by the Corporation and authenticated and
delivered by the Trustee in exchange for Outstanding Securities of such series.
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ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest.
The Corporation covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of and any premium
and interest on the Securities of that series in accordance with the terms of
the Securities and this Indenture.
Section 1002. Maintenance of Office or Agency.
The Corporation will maintain in each Place of Payment for any series
of Securities an office or agency where Securities of that series may be
presented or surrendered for payment, where Securities of that series may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Corporation in respect of the Securities of that series
and this Indenture may be served. The Corporation will give prompt written
notice to the Trustee of the location, and any change in the location, of such
office or agency. If at any time the Corporation shall fail to maintain any
such required office or agency or shall fail to furnish the Trustee with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the Corporate Trust Office of the Trustee, and the Corporation
hereby appoints the Trustee as its agent to receive all such presentations,
surrenders, notices and demands.
The Corporation may also from time to time designate one or more other
offices or agencies where the Securities of one or more series may be presented
or surrendered for any or all such purposes and may from time to time rescind
such designations; provided, however, that no such designation or rescission
shall in any manner relieve the Corporation of its obligation to maintain an
office or agency in each Place of Payment for Securities of any series for such
purposes. The Corporation will give prompt written notice to the Trustee of any
such designation or rescission and of any change in the location of any such
other office or agency.
Section 1003. Money for Securities Payments to Be Held in Trust.
If the Corporation shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of the
principal of or any premium or interest on any of the Securities of that series,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay the principal and any premium and interest so becoming due
until such sums shall be paid to such Persons or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or failure so to
act.
Whenever the Corporation shall have one or more Paying Agents for any
series of Securities, it will, on or prior to each due date of the principal of
or any premium or interest on any Securities of that series, deposit with a
Paying Agent a sum sufficient to pay such amount, such sum to be held as
provided by the Trust Indenture Act, and (unless such
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Paying Agent is the Trustee) the Corporation will promptly notify the Trustee of
its action or failure so to act.
The Corporation will cause each Paying Agent for any series of
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will (1) comply with the
provisions of the Trust Indenture Act applicable to it as a Paying Agent and (2)
during the continuance of any default by the Corporation (or any other obligor
upon the Securities of that series) in the making of any payment in respect of
the Securities of that series, upon the written request of the Trustee,
forthwith pay to the Trustee all sums held in trust by such Paying Agent for
payment in respect of the Securities of that series.
The Corporation may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust hereunder by the Corporation or such Paying Agent, such sums to be held by
the Trustee upon the same trusts as those upon which such sums were held by the
Corporation or such Paying Agent; and, upon such payment by any Paying Agent to
the Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Corporation, in trust for the payment of the principal of or any premium
or interest on any Security of any series and remaining unclaimed for two years
after such principal, premium or interest has become due and payable shall be
paid to the Corporation on Company Request, or (if then held by the Corporation)
shall be discharged from such trust; and the Holder of such Security shall
thereafter, as an unsecured general creditor, look only to the Corporation for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Corporation as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Corporation cause to be published once, in a newspaper published
in the English language, customarily published on each Business Day and of
general circulation in the Borough of Manhattan, The City of New York, New York,
notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such publication,
any unclaimed balance of such money then remaining will be repaid to the
Corporation.
Section 1004. Limitation on Liens.
The Corporation will not, nor will it permit any Principal Subsidiary
of the Corporation to, while any of the Securities remain Outstanding, create,
or suffer to be created or to exist, any mortgage, lien, pledge, security
interest or other encumbrance of any kind upon any Principal Property of the
Corporation or any Principal Subsidiary of the Corporation or upon any shares of
stock of any Principal Subsidiary of the Corporation, whether such Principal
Property is, or shares of stock are, now owned or hereafter acquired, to secure
any indebtedness for borrowed money of the Corporation, unless it shall make
effective provision whereby the Securities then Outstanding shall be secured by
such mortgage, lien, pledge, security interest or other encumbrance equally and
ratably with any and all indebtedness for borrowed money thereby secured so long
as any such indebtedness shall be so secured; provided, however, that nothing in
this Section shall be construed to prevent the Corporation or any Principal
Subsidiary of the Corporation from creating, or from suffering to be created or
to exist, any mortgages, liens, pledges, security interests or other
encumbrances, or any agreements, with respect to:
(1) purchase money mortgages, or other purchase money liens,
pledges, security interests or encumbrances of any kind upon property
hereafter acquired by the Corporation or any Principal Subsidiary of the
Corporation, or mortgages, liens, pledges, security interests or other
encumbrances of any kind existing on any property or any shares of stock
at the time of the acquisition thereof (including mortgages, liens,
pledges, security interests or other encumbrances which exist on any
property or any shares of stock of a Person which is consolidated with
or merged with or into the Corporation or any Principal Subsidiary of
the Corporation or which transfers or leases all or substantially all of
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its properties to the Corporation or any Principal Subsidiary of the
Corporation), or conditional sales agreements or other title retention
agreements and leases in the nature of title retention agreements with
respect to any property hereafter acquired; provided, however, that no
such mortgage, lien, pledge, security interest or other encumbrance
shall extend to or cover any other property of the Corporation or such
Principal Subsidiary of the Corporation;
(2) mortgages, liens, pledges, security interests or other
encumbrances of any kind upon any property of the Corporation or any
Principal Subsidiary of the Corporation or any shares of stock of any
Principal Subsidiary of the Corporation existing as of the date of the
initial issuance of the Securities or upon the property or any shares of
stock of any corporation, which mortgages, liens, pledges, security
interests or other encumbrances existed at the time such corporation
became a Principal Subsidiary of the Corporation; liens for taxes or
assessments or other governmental charges or levies; pledges other
governmental charges or levies; pledges or deposits to secure
obligations under worker's compensation laws, unemployment insurance and
other social security legislation, including liens of judgments
thereunder which are not currently dischargeable; pledges or deposits to
secure performance in connection with bids, tenders, contracts (other
than contracts for the payment of money) or leases to which the
Corporation or any Principal Subsidiary of the Corporation is a party;
pledges or deposits to secure public or statutory obligations of the
Corporation or any Principal Subsidiary of the Corporation; builders',
materialmen's, mechanics', carriers', warehousemen's, workers',
repairmen's, operators', landlords' or other like liens in the ordinary
course of business, or deposits to obtain the release of such liens;
pledges or deposits to secure, or in lieu of, surety, stay, appeal,
indemnity, customs, performance or return-of-money bonds; other pledges
or deposits for similar purposes in the ordinary course of business;
liens created by or resulting from any litigation or proceeding which at
the time is being contested in good faith by appropriate proceedings;
liens incurred in connection with the issuance of bankers' acceptances
and lines of credit, bankers' liens or rights of offset and any security
given in the ordinary course of business to banks or others to secure
any indebtedness payable on demand or maturing within 12 months of the
date that such indebtedness is originally incurred; liens incurred in
connection with repurchase, swap or other similar agreements (including,
without limitation, commodity price, currency exchange and interest rate
protection agreements); leases made, or existing on property acquired,
in the ordinary course of business; liens securing industrial revenue or
pollution control bonds; liens, pledges, security interests or other
encumbrances on any property arising in connection with any defeasance,
covenant defeasance or in-substance defeasance of indebtedness of the
Corporation or any Principal Subsidiary of the Corporation, including
the Securities; liens created in connection with, and created to secure,
a non-recourse obligation; zoning restrictions, easements, licenses,
rights-of-way, restrictions on the use of property or minor
irregularities in title thereto, which do not, in the opinion of the
Corporation, materially impair the use of such property in the operation
of the business of the Corporation or the value of such property for the
purpose of such business;
(3) mortgages, liens, pledges, security interests or other
encumbrances in favor of the United States of America, any State, any
foreign country or any department, agency or instrumentality or
political subdivision of any such jurisdiction, to secure partial,
progress, advance or other payments pursuant to any contract or statute
or to secure any indebtedness incurred for the purpose of financing all
or any part of the purchase price or the cost of constructing or
improving the property subject to such mortgages, including, without
limitation, mortgages to secure indebtedness of the pollution control or
industrial revenue bond type;
(4) indebtedness which may be issued by the Corporation or any
Principal Subsidiary of the Corporation in connection with a
consolidation or merger of the Corporation or any Principal Subsidiary
of the Corporation with or into any other Person (which may be an
Affiliate of the Corporation or any Principal Subsidiary of the
Corporation) in exchange for or otherwise in substitution for secured
indebtedness of such Person ("Third Party Debt") which by its terms (i)
is secured by a mortgage on all or a portion of the property of such
Person, (ii) prohibits secured indebtedness from being incurred by such
Person, unless the Third Party Debt shall be secured equally and ratably
with such secured indebtedness or (iii) prohibits secured indebtedness
from being incurred by such Person;
(5) indebtedness of any Person which is required to be assumed
by the Corporation or any Principal Subsidiary of the Corporation in
connection with a consolidation or merger of such Person, with respect
to which any property of the Corporation or any Principal Subsidiary of
the Corporation is subjected to a mortgage, lien, pledge, security
interest or other encumbrance;
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(6) mortgages, liens, security interests or other encumbrances
on property held or used by the Corporation or any Principal Subsidiary
of the Corporation in connection with the exploration for, or
development, gathering, production, storage or marketing of, natural
gas, oil or other minerals (including liquified gas and synthetic gas);
(7) mortgages, liens, pledges, security interests or other
encumbrances of any kind upon any property acquired, constructed,
developed or improved by the Corporation or any Principal Subsidiary of
the Corporation (whether alone or in association with others) after the
date of the Indenture which are created prior to, at the time of, or
within 18 months after such acquisition (or in the case of property
constructed, developed or improved, after the completion of such
construction, development or improvement and commencement of full
commercial operation of such property, whichever is later) to secure or
provide for the payment of any part of the purchase price or cost
thereof; provided that in the case of such construction, development or
improvement the mortgages, liens, pledges, security interests or other
encumbrances shall not apply to any property theretofore owned by the
Corporation or any Principal Subsidiary of the Corporation other than
theretofore unimproved real property;
(8) mortgages, liens, pledges, security interests and other
encumbrances in favor of the Corporation, one or more Principal
Subsidiaries of the Corporation, one or more wholly-owned Subsidiaries
of the Corporation or any of the foregoing in combination;
(9) the replacement, extension or renewal (or successive
replacements, extensions or renewals), as a whole or in part, of any
mortgage, lien, pledge, security interest or other encumbrance, or of
any agreement, referred to above in clauses (1) through (8) inclusive,
or the replacement, extension or renewal (not exceeding the principal
amount of indebtedness secured thereby together with any premium,
interest, fee or expense payable in connection with any such
replacement, extension or renewal) of the indebtedness secured thereby;
provided that such replacement, extension or renewal is limited to all
or a part of the same property that secured the mortgage, lien, pledge,
security interest or other encumbrance replaced, extended or renewed
(plus improvements thereon or additions or accessions thereto); or
(10) any other mortgage, lien, pledge, security interest or
other encumbrance not excepted by the foregoing clauses (1) through (9);
provided that immediately after the creation or assumption of such
mortgage, lien, pledge, security interest or other encumbrance, the
aggregate principal amount of indebtedness for borrowed money of the
Corporation secured by all mortgages, liens, pledges, security interests
and other encumbrances created or assumed under the provisions of this
clause (10) shall not exceed an amount equal to 10% of common
stockholder's equity of the Corporation, as shown on its consolidated
balance sheet for the accounting period occurring immediately prior to
the creation or assumption of such mortgage, lien, pledge, security
interest or other encumbrance.
Section 1005. Statement by Officers as to Default.
The Corporation will deliver to the Trustee, on or before October 15
of each calendar year or on or before such other day in each calendar year as
the Corporation and the Trustee may from time to time agree upon, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Corporation is in default in the performance and observance of any of the
terms, provisions and conditions of this Indenture (without regard to any period
of grace or requirement of notice provided hereunder) and, if the Corporation
shall be in default, specifying all such defaults and the nature and status
thereof of which they may have knowledge.
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Section 1006. Waiver of Certain Covenants.
Except as otherwise specified as contemplated by Section 301 for
Securities of such series, the Corporation may, with respect to the Securities
of any series, omit in any particular instance to comply with any term,
provision or condition set forth in any covenant provided pursuant to Section
301(19), 901(2) or 901(7) for the benefit of the Holders of such series or in
Section 1004 if before the time for such compliance the Holders of not less than
a majority in principal amount of the Outstanding Securities of such series
shall, by Act of such Holders, either waive such compliance in such instance or
generally waive compliance with such term, provision or condition, but no such
waiver shall extend to or affect such term, provision or condition except to the
extent so expressly waived, and, until such waiver shall become effective, the
obligations of the Corporation and the duties of the Trustee in respect of any
such term, provision or condition shall remain in full force and effect.
Section 1007. Calculation of Original Issue Discount.
The Corporation shall file with the Trustee promptly after the end of
each calendar year a written notice specifying the amount of original issue
discount (including daily rates and accrual periods) accrued on Outstanding
Securities as of the end of such year.
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ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article.
Securities of any series which are redeemable before their Stated
Maturity shall be redeemable in accordance with their terms and (except as
otherwise specified as contemplated by Section 301 for such Securities) in
accordance with this Article.
Section 1102. Election to Redeem; Notice to Trustee.
The election of the Corporation to redeem any Securities shall be
evidenced by a Board Resolution or in another manner specified as contemplated
by Section 301 for such Securities. In case of any redemption at the election
of the Corporation, the Corporation shall, at least 45 days prior to the
Redemption Date fixed by the Corporation (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date, of the
principal amount of Securities of such series to be redeemed and, if applicable,
of the tenor of the Securities to be redeemed. In the case of any redemption of
Securities (a) prior to the expiration of any restriction on such redemption
provided in the terms of such Securities or elsewhere in this Indenture, or (b)
pursuant to an election of the Corporation which is subject to a condition
specified in the terms of such Securities or elsewhere in this Indenture, the
Corporation shall furnish the Trustee with an Officers' Certificate evidencing
compliance with such restriction or condition.
Section 1103. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities of any series are to be redeemed
(unless all the Securities of such series and of a specified tenor are to be
redeemed or unless such redemption affects only a single Security), the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee, from the Outstanding Securities of
such series not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of a portion of the principal amount of any Security of such series;
provided that the unredeemed portion of the principal amount of any Security
shall be in an authorized denomination (which shall not be less than the minimum
authorized denomination) for such Security. If less than all the Securities of
such series and of a specified tenor are to be redeemed (unless such redemption
affects only a single Security), the particular Securities to be redeemed shall
be selected not more than 60 days prior to the Redemption Date by the Trustee,
from the Outstanding Securities of such series and specified tenor not
previously called for redemption in accordance with the preceding sentence.
The Trustee shall promptly notify the Corporation in writing of the
Securities selected for redemption as aforesaid and, in the case of any
Securities selected for partial redemption as aforesaid, the principal amount
thereof to be redeemed.
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The provisions of the two preceding paragraphs shall not apply with
respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
Section 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Securities to be redeemed, at his address appearing in
the Security Register.
All notices of redemption shall state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) if less than all the Outstanding Securities of any series and of a
specified tenor consisting of more than a single Security are to be
redeemed, the identification (and, in the case of partial redemption of any
such Securities, the principal amounts) of the particular Securities to be
redeemed and, if less than all the Outstanding Securities of any series and
of a specified tenor consisting of a single Security are to be redeemed,
the principal amount of the particular Security to be redeemed;
(4) that on the Redemption Date the Redemption Price, together with
accrued interest, if any, to the Redemption Date, will become due and
payable upon each such Security to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date;
(5) the place or places where each such Security is to be surrendered
for payment of the Redemption Price and accrued interest, if any, unless it
shall have been specified as contemplated by Section 301 with respect to
such Securities that such surrender shall not be required;
(6) that the redemption is for a sinking fund, if such is the case;
and
(7) such other matters as the Corporation shall deem desirable or
appropriate.
Unless otherwise specified with respect to any Securities in
accordance with Section 301, with respect to any redemption of Securities at the
election of the Corporation, unless, upon the giving of notice of such
redemption, Defeasance shall have been effected with
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respect to such Securities pursuant to Section 1302, such notice may state that
such redemption shall be conditional upon the receipt by the Trustee or the
Paying Agent(s) for such Securities, on or prior to the date fixed for such
redemption, of money sufficient to pay the principal of and any premium and
interest on such Securities and that if such money shall not have been so
received such notice shall be of no force or effect and the Corporation shall
not be required to redeem such Securities. In the event that such notice of
redemption contains such a condition and such money is not so received, the
redemption shall not be made and within a reasonable time thereafter notice
shall be given, in the manner in which the notice of redemption was given, that
such money was not so received and such redemption was not required to be made,
and the Trustee or Paying Agent(s) for the Securities otherwise to have been
redeemed shall promptly return to the Holders thereof any of such Securities
which had been surrendered for payment upon such redemption.
Notice of redemption of Securities to be redeemed at the election of
the Corporation, and any notice of non-satisfaction of redemption as aforesaid,
shall be given by the Corporation or, at the Corporation's request, by the
Trustee in the name and at the expense of the Corporation. Subject to the
preceding paragraph, any such notice of redemption shall be irrevocable.
Section 1105. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, and the
conditions, if any, set forth in such notice having been satisfied, the
Securities or portions thereof so to be redeemed shall, on the Redemption Date,
become due and payable at the Redemption Price therein specified, and from and
after such date (unless, in the case of an unconditional notice of redemption,
the Corporation shall default in the payment of the Redemption Price and accrued
interest, if any) such Securities or portions thereof, if interest-bearing,
shall cease to bear interest. Upon surrender of any such Security for
redemption in accordance with said notice, such Security or portion thereof
shall be paid by the Corporation at the Redemption Price, together with accrued
interest, if any, to the Redemption Date; provided, however, that no such
surrender shall be a condition to such payment if so specified as contemplated
by Section 301 with respect to such Security, and provided further that, unless
otherwise specified as contemplated by Section 301, installments of interest
whose Stated Maturity is on or prior to the Redemption Date will be payable to
the Holders of such Securities, or one or more Predecessor Securities,
registered as such at the close of business on the relevant Record Dates
according to their terms and the provisions of Section 307.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and any premium shall, until
paid, bear interest from the Redemption Date at the rate prescribed therefor in
the Security.
Section 1106. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered
at a Place of Payment therefor (with, if the Corporation or the Trustee so
requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Corporation and the Trustee duly executed by, the Holder
thereof or his attorney duly authorized in writing), and the Corporation shall
execute, and the Trustee shall authenticate and deliver to the Holder of such
Security without service charge, a new Security or Securities of the same series
and of
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like tenor, of any authorized denomination as requested by such Holder, in
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered.
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund
for the retirement of Securities of any series except as otherwise specified as
contemplated by Section 301 for such Securities.
The minimum amount of any sinking fund payment provided for by the
terms of any Securities is herein referred to as a "mandatory sinking fund
payment," and any payment in excess of such minimum amount provided for by the
terms of such Securities is herein referred to as an "optional sinking fund
payment." If provided for by the terms of any Securities, the cash amount of
any sinking fund payment may be subject to reduction as provided in Section
1202. Each sinking fund payment shall be applied to the redemption of
Securities as provided for by the terms of such Securities.
Section 1202. Satisfaction of Sinking Fund Payments with Securities.
The Corporation (1) may deliver Outstanding Securities of a series
(other than any previously called for redemption) and (2) may apply as a credit
Securities of a series which have been redeemed either at the election of the
Corporation pursuant to the terms of such Securities or through the application
of permitted optional sinking fund payments pursuant to the terms of such
Securities, in each case in satisfaction of all or any part of any sinking fund
payment with respect to any Securities of such series required to be made
pursuant to the terms of such Securities as and to the extent provided for by
the terms of such Securities; provided that the Securities to be so credited
have not been previously so credited. The Securities to be so credited shall be
received and credited for such purpose by the Trustee at the Redemption Price,
as specified in the Securities so to be redeemed, for redemption through
operation of the sinking fund and the amount of such sinking fund payment shall
be reduced accordingly.
Section 1203. Redemption of Securities for Sinking Fund.
Not less than 45 days prior to each sinking fund payment date for any
Securities, the Corporation will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for such
Securities pursuant to the terms of such Securities, the portion thereof, if
any, which is to be satisfied by payment of cash and the portion thereof, if
any, which is to be satisfied by delivering and crediting Securities pursuant to
Section 1202 and stating the basis for such credit and that such Securities have
not been previously so credited and will also deliver to the Trustee any
Securities to be so delivered. Not less than 30 days prior to each such sinking
fund payment date, the Trustee shall select
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the Securities to be redeemed upon such sinking fund payment date in the manner
specified in Section 1103 and cause notice of the redemption thereof to be given
in the name of and at the expense of the Corporation in the manner provided in
Section 1104. Such notice having been duly given, the redemption of such
Securities shall be made upon the terms and in the manner stated in Sections
1105 and 1106.
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Applicability of Article.
Unless, pursuant to Section 301, provision is made that either or both
of (a) defeasance of any Securities or any series of Securities under Section
1302 and (b) covenant defeasance of any Securities or any series of Securities
under Section 1303 shall not apply to such Securities of a series, then the
provisions of either or both of Sections 1302 and Section 1303, as the case may
be, together with Sections 1304 and 1305, shall be applicable to the Outstanding
Securities of such series upon compliance with the conditions set forth below in
this Article.
Section 1302. Defeasance and Discharge.
The Corporation may cause itself to be discharged from its obligations
with respect to any Securities or any series of Securities on and after the date
the conditions set forth in Section 1304 are satisfied (hereinafter called
"Defeasance"). For this purpose, such Defeasance means that the Corporation
shall be deemed to have paid and discharged the entire indebtedness represented
by such Securities and to have satisfied all its other obligations under such
Securities and this Indenture insofar as such Securities are concerned (and the
Trustee, at the expense of the Corporation, shall execute proper instruments
acknowledging the same), subject to the following which shall survive until
otherwise terminated or discharged hereunder: (1) the rights of Holders of such
Securities to receive, solely from the trust fund described in Section 1304 and
as more fully set forth in such Section, payments in respect of the principal of
and any premium and interest on such Securities when payments are due, (2) the
Corporation's obligations with respect to such Securities under Sections 304,
305, 306, 1002 and 1003 and with respect to the Trustee under Section 607, (3)
the rights, powers, trusts, duties and immunities of the Trustee hereunder and
(4) this Article. Subject to compliance with this Article, Defeasance with
respect to any Securities or any series of Securities by the Corporation is
permitted under this Section 1302 notwithstanding the prior exercise by the
Corporation of its rights under Section 1303 with respect to such Securities.
Following a Defeasance, payment of such Securities may not be accelerated
because of an Event of Default.
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Section 1303. Covenant Defeasance.
The Corporation may cause itself to be released from its obligations
under Section 1004 and any covenants provided pursuant to Section 301(19),
901(2), 901(6) or 901(7) with respect to any Securities or any series of
Securities for the benefit of the Holders of such Securities and the occurrence
of any event specified in Sections 501(4) (with respect to Section 1004 and any
such covenants provided pursuant to Section 301(19), 901(2), 901(6) or 901(7))
or 501(7) shall be deemed not to be or result in an Event of Default with
respect to such Securities as provided in this Section, in each case on and
after the date the conditions set forth in Section 1304 are satisfied
(hereinafter called "Covenant Defeasance"). For this purpose, such Covenant
Defeasance means that, with respect to such Securities, the Corporation may omit
to comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such specified Section (to the extent so specified
in the case of Section 501(4)), whether directly or indirectly by reason of any
reference elsewhere herein to any such Section or by reason of any reference in
any such Section to any other provision herein or in any other document, but the
remainder of this Indenture and such Securities shall be unaffected thereby.
Section 1304. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of Section
1302 or Section 1303 to any Securities or any series of Securities, as the case
may be:
(1) The Corporation shall irrevocably have deposited or caused to be
deposited with the Trustee as trust funds in trust for the purpose of
making the following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such Securities, (A)
money in an amount, or (B) Government Obligations which through the
scheduled payment of principal and interest in respect thereof in
accordance with their terms will provide, not later than the due date of
any payment, money in an amount, or (C) a combination thereof,
sufficient, in the case of (B) or (C), in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and discharge, and
which shall be applied by the Trustee to pay and discharge, the principal
of and any premium and interest on such Securities on the respective Stated
Maturities or on any Redemption Date established pursuant to Clause (3)
below, in accordance with the terms of this Indenture and such Securities.
As used herein, "Government Obligation" means (x) any security which is (i)
a direct obligation of the United States of America or the government which
issued the foreign currency in which such Securities are payable, for the
payment of which its full faith and credit is pledged or (ii) an obligation
of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America or such government which
issued the foreign currency in which such Securities are payable, the
payment of which is unconditionally guaranteed as a full faith and credit
obligation by the United States of America or such other government, which,
in either case (i) or (ii), is not callable or redeemable at the option of
the issuer thereof, and (y) any depositary receipt issued by a bank (as
defined in Section 3(a)(2) of the Securities Act) as custodian with respect
to any Government Obligation which is specified in clause (x) above and
held by such bank for the account of the holder of such depositary receipt,
or with respect to any specific payment of principal of or interest on any
Government Obligation which is so specified and held, provided that (except
as required by law) such
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custodian is not authorized to make any deduction from the amount payable
to the holder of such depositary receipt from any amount received by the
custodian in respect of the Government Obligation or the specific payment
of principal or interest evidenced by such depositary receipt.
(2) No event which is, or after notice or lapse of time or both would
become, an Event of Default with respect to such Securities or any other
Securities shall have occurred and be continuing at the time of such
deposit or, with regard to any such event specified in Sections 501(5) and
(6), at any time on or prior to the 90th day after the date of such deposit
(it being understood that this condition shall not be deemed satisfied
until after such 90th day).
(3) If the Securities are to be redeemed prior to Stated Maturity
(other than from mandatory sinking fund payments or analogous payments),
notice of such redemption shall have been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee shall have been
made.
(4) The Corporation shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent with respect to such Defeasance or Covenant Defeasance have been
complied with.
Section 1305. Deposited Money and Government Obligations to Be Held in Trust;
Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1003, all
money and Government Obligations (including the proceeds thereof) deposited with
the Trustee pursuant to Section 1304 in respect of any Securities shall be held
in trust and applied by the Trustee, in accordance with the provisions of such
Securities and this Indenture, to the payment, either directly or through any
such Paying Agent (including the Corporation acting as its own Paying Agent) as
the Trustee may determine, to the Holders of such Securities, of all sums due
and to become due thereon in respect of principal and any premium and interest,
but money so held in trust need not be segregated from other funds except to the
extent required by law.
The Corporation shall pay and indemnify the Trustee against any tax,
fee or other charge imposed on or assessed against the Government Obligations
deposited pursuant to Section 1304 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.
Anything in this Article to the contrary notwithstanding, the Trustee
shall deliver or pay to the Corporation from time to time upon Company Request
any money or Government Obligations held by it as provided in Section 1304 with
respect to any Securities which, in the opinion of a nationally recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect the Defeasance or Covenant Defeasance, as
the case may be, with respect to such Securities.
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ARTICLE FOURTEEN
Immunity of Incorporators, Stockholders, Officers and Directors
Section 1401. Indenture and Securities Solely Corporate Obligations.
No recourse for the payment of the principal of or any premium 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 Corporation in this Indenture or in any supplemental 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 Corporation or of any successor
corporation, either directly or through the Corporation or any successor
corporation, 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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This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
In Witness Whereof, the parties hereto have caused this Indenture to
be duly executed, and their respective corporate seals to be hereunto affixed
and attested, all as of the day and year first above written.
DUKE CAPITAL CORPORATION
By /S/ Richard J. Osborne
----------------------------
Vice President
Attest:
/S/ Robert T. Lucas III
- ---------------------------------
THE CHASE MANHATTAN BANK,
as Trustee
By /S/ P. Kelly
----------------------------
Vice President
Attest:
/S/ R. Lorenzen
- -------------------------------
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EXHIBIT 4.2
DUKE CAPITAL CORPORATION
TO
THE CHASE MANHATTAN BANK
TRUSTEE
----------------
SUPPLEMENTAL INDENTURE
DATED AS OF ,
----------------
$
SERIES % SENIOR NOTES DUE
----------------
<PAGE>
TABLE OF CONTENTS (1)
ARTICLE 1
Series % Senior Notes Due
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
Section 101. Establishment............................................... 1
Section 102. Definitions................................................. 2
Section 103. Payment of Principal and Interest........................... 2
Section 104. Denominations............................................... 3
Section 105. Global Securities........................................... 3
Section 106. Redemption at the Option of the Corporation................. 3
Section 107. Paying Agent................................................ 5
ARTICLE 2
Miscellaneous Provisions
Section 201. Recitals by Corporation..................................... 5
Section 202. Ratification and Incorporation of Original Indenture........ 5
Section 203. Executed in Counterparts.................................... 5
</TABLE>
Exhibit A Form of Series % Senior Note Due
Exhibit B Certificate of Authentication
- --------
(1) This Table of Contents does not constitute part of the Indenture or have
any bearing upon the interpretation of any of its terms and provisions.
i
<PAGE>
THIS SUPPLEMENTAL INDENTURE is made as of the day of , , by
and between DUKE CAPITAL CORPORATION, a Delaware corporation, having its
principal office at 422 South Church Street, Charlotte, North Carolina 28202
(the "Corporation"), and THE CHASE MANHATTAN BANK, a New York banking
corporation, as Trustee (herein called the "Trustee").
W I T N E S S E T H:
WHEREAS, the Corporation has heretofore entered into a Senior Indenture, dated
as of April 1, 1998 (the "Original Indenture") with The Chase Manhattan Bank,
as Trustee;
WHEREAS, the Original Indenture is incorporated herein by this reference and
the Original Indenture, as amended and supplemented to the date hereof,
including by this Supplemental Indenture, is herein called the "Indenture";
WHEREAS, under the Indenture, a new series of Securities may at any time be
established in accordance with the provisions of the Indenture and the terms of
such series may be described by a supplemental indenture executed by the
Corporation and the Trustee;
WHEREAS, the Corporation proposes to create under the Indenture a series of
Securities;
WHEREAS, additional Securities of other series hereafter established, except as
may be limited in the Indenture as at the time supplemented and modified, may
be issued from time to time pursuant to the Indenture as at the time
supplemented and modified; and
WHEREAS, all conditions necessary to authorize the execution and delivery of
this Supplemental Indenture and to make it a valid and binding obligation of
the Corporation have been done or performed.
NOW, THEREFORE, in consideration of the agreements and obligations set forth
herein and for other good and valuable consideration, the sufficiency of which
is hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE 1
Series % Senior Notes Due
Section 101. Establishment. There is hereby established a new series of
Securities to be issued under the Indenture, to be designated as the
Corporation's Series % Senior Notes Due (the "Series Notes").
There are to be authenticated and delivered $ principal amount of
Series Notes, and no further Series Notes shall be authenticated and
delivered except as provided by Section 304, 305, 306, 906 or 1106 of the
Original Indenture. The Series Notes shall be issued in fully registered form
without coupons.
<PAGE>
The Series Notes shall be in substantially the form set out in Exhibit A
hereto, and the form of the Trustee's Certificate of Authentication for the
Series Notes shall be in substantially the form set forth in Exhibit B
hereto.
Each Series Note shall be dated the date of authentication thereof and shall
bear interest from the date of original issuance thereof or from the most
recent Interest Payment Date to which interest has been paid or duly provided
for.
Section 102. Definitions. The following defined terms used herein shall, unless
the context otherwise requires, have the meanings specified below. Capitalized
terms used herein for which no definition is provided herein shall have the
meanings set forth in the Original Indenture.
"Interest Payment Dates" means and .
"Original Issue Date" means , .
"Regular Record Date" means, with respect to each Interest Payment Date, the
close of business on the 15th calendar day prior to such Interest Payment Date.
"Stated Maturity" means , .
Section 103. Payment of Principal and Interest. The unpaid principal amount of
the Series Notes shall bear interest at the rate of % per annum until paid
or duly provided for, such interest to accrue from , or from the
most recent Interest Payment Date to which interest has been paid or duly
provided for. Interest shall be paid semi-annually in arrears on each Interest
Payment Date to the Person or Persons in whose name the Series Notes are
registered on the Regular Record Date for such Interest Payment Date; provided
that interest payable at the Stated Maturity of principal or on a Redemption
Date as provided herein shall be paid to the Person to whom principal is
payable. Any such interest that is not so punctually paid or duly provided for
shall forthwith cease to be payable to the Holders on such Regular Record Date
and may either be paid to the Person or Persons in whose name the Series Notes
are registered at the close of business on a Special Record Date for the payment
of such defaulted interest to be fixed by the Trustee ("Special Record Date"),
notice whereof shall be given to Holders of the Series Notes not less than ten
(10) days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange,
if any, on which the Series Notes may be listed, and upon such notice as may be
required by any such exchange, all as more fully provided in the Original
Indenture.
Payments of interest on the Series Notes shall include interest accrued to
but excluding the respective Interest Payment Dates. Interest payments for the
Series Notes shall be computed and paid 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 Series Notes is not a Business Day, then payment of the interest
payable on such date shall be made on the next succeeding day that is a
Business Day (and without any interest or payment in respect of any such delay)
with the same force and effect as if made on the date the payment was
originally payable. "Business Day" means a day other than (i) a Saturday or a
Sunday, (ii) a day on which banking institutions in New York, New York are
authorized or obligated
2
<PAGE>
by law or executive order to remain closed or (iii) a day on which the
Corporate Trust Office is closed for business.
Payment of principal of, premium, if any, and interest on the Series Notes
shall be made in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debts.
Payments of principal of, premium, if any, and interest on Series Notes
represented by a Global Security shall be made by wire transfer of immediately
available funds to the Holder of such Global Security, provided that, in the
case of payments of principal and premium, if any, such Global Security is
first surrendered to the Paying Agent. If any of the Series Notes are no
longer represented by a Global Security, (i) payments of principal, premium, if
any, and interest due at the Stated Maturity or earlier redemption of such
Series Notes shall be made at the office of the Paying Agent upon surrender
of such Series Notes to the Paying Agent and (ii) payments of interest shall
be made, at the option of the Corporation, subject to such surrender where
applicable, (A) by check mailed to the address of the Person entitled thereto
as such address shall appear in the Security Register or (B) by wire transfer
at such place and to such account at a banking institution in the United States
as may be designated in writing to the Trustee at least sixteen (16) days prior
to the date for payment by the Person entitled thereto.
Section 104. Denominations. The Series Notes shall be issued in denominations
of $ or any integral multiple thereof.
Section 105. Global Securities. The Series Notes shall initially be issued in
the form of one or more Global Securities registered in the name of the
Depositary (which initially shall be The Depository Trust Company) or its
nominee. Except under the limited circumstances described below, Series Notes
represented by such Global Security or Global Securities shall not be
exchangeable for, and shall not otherwise be issuable as, Series Notes in
definitive form. The Global Securities described above may not be transferred
except 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 or to a
successor Depositary or its nominee.
A Global Security shall be exchangeable for Series Notes registered in the
names of persons other than the Depositary or its nominee only if (i) the
Depositary notifies the Corporation that it is unwilling or unable to continue
as a Depositary for such Global Security and no successor Depositary shall have
been appointed by the Corporation within 90 days of receipt by the Corporation
of such notification, or if at any time the Depositary ceases to be a clearing
agency registered under the Exchange Act at a time when the Depositary is
required to be so registered to act as such Depositary and no successor
Depositary shall have been appointed by the Corporation within 90 days after it
becomes aware of such cessation, or (ii) the Corporation in its sole discretion
determines that such Global Security shall be so exchangeable. Any Global
Security that is exchangeable pursuant to the preceding sentence shall be
exchangeable for Series Notes registered in such names as the Depositary
shall direct.
Section 106. Redemption at the Option of the Corporation. The Series Notes
shall be redeemable, in whole or from time to time in part, at the option of
the Corporation on any date (a "Redemption Date"), at a Redemption Price equal
to the greater of (i) 100% of the principal amount of the Series Notes to be
redeemed and (ii) the sum of the present values of the remaining
3
<PAGE>
scheduled payments of principal and interest thereon (exclusive of interest
accrued to such Redemption Date) discounted to such Redemption Date on a semi-
annual basis (assuming a 360-day year consisting of twelve 30-day months) at
the Treasury Rate plus basis points, plus, in either case, accrued and unpaid
interest on the principal amount being redeemed to such Redemption Date.
"Treasury Rate" means, with respect to any Redemption Date for the Series
Notes, (i) the yield, under the heading which represents the average for the
immediately preceding week, appearing in the most recently published
statistical release designated "H.15(519)" or any successor publication which
is published weekly by the Board of Governors of the Federal Reserve System 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 Comparable Treasury Issue (if no maturity
is within three months before or after the Stated Maturity, yields for the two
published maturities most closely corresponding to the Comparable Treasury
Issue shall be determined and the 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, calculated using 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. The Treasury Rate shall be
calculated on the third Business Day preceding the Redemption Date.
"Comparable Treasury Issue" means the United States Treasury security selected
by the Independent Investment Banker as having a maturity comparable to the
remaining term of the Series Notes to be redeemed that would be utilized, at
the time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of the Series Notes.
"Independent Investment Banker" means and any
successor firm or, if such firm is unwilling or unable to select the Comparable
Treasury Issue, an independent investment banking institution of national
standing appointed by the Trustee after consultation with the Corporation.
"Comparable Treasury Price" means with respect to any Redemption Date for the
Series Notes (i) the average of Reference Treasury Dealer Quotations for
such Redemption Date, after excluding the highest and lowest such Reference
Treasury Dealer Quotations, or (ii) if the Trustee obtains fewer than such
Reference Treasury Dealer Quotations, the average of all such quotations.
"Reference Treasury Dealer" means each of , ,
, and and their
respective successors; provided, however, that if any of the foregoing shall
cease to be a primary U.S. Government securities dealer in New York City (a
"Primary Treasury Dealer"), the Corporation will substitute therefor another
Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any Redemption Date, the average, as determined by the
Trustee, of the bid and asked prices for
4
<PAGE>
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.
Notwithstanding Section 1104 of the Original Indenture, the notice of
redemption with respect to the foregoing redemption need not set forth the
Redemption Price but only the manner of calculation thereof.
The Corporation shall notify the Trustee of the Redemption Price with respect
to the foregoing redemption promptly after the calculation thereof. The Trustee
shall not be responsible for calculating said Redemption Price.
If less than all of the Series Notes are to be redeemed, the Trustee shall
select the Series Notes or portions of Series Notes to be redeemed by such
method as the Trustee shall deem fair and appropriate. The Trustee may select
for redemption Series Notes and portions of Series Notes in amounts of
whole multiples of $ .
The Series Notes shall not have a sinking fund.
Section 107. Paying Agent. The Trustee shall initially serve as Paying Agent
with respect to the Series Notes, with the Place of Payment initially being
the Corporate Trust Office.
ARTICLE 2
Miscellaneous Provisions
Section 201. Recitals by Corporation. The recitals in this Supplemental
Indenture are made by the Corporation only and not by the Trustee, and all of
the provisions contained in the Original Indenture in respect of the rights,
privileges, immunities, powers and duties of the Trustee shall be applicable in
respect of the Series Notes and this Supplemental Indenture as fully and
with like effect as if set forth herein in full.
Section 202. Ratification and Incorporation of Original Indenture. As
supplemented hereby, the Original Indenture is in all respects ratified and
confirmed, and the Original Indenture and this Supplemental Indenture shall
be read, taken and construed as one and the same instrument.
Section 203. Executed in Counterparts. This Supplemental Indenture may be
executed in several counterparts, each of which shall be deemed to be an
original, and such counterparts shall together constitute but one and the same
instrument.
5
<PAGE>
IN WITNESS WHEREOF, each party hereto has caused this instrument to be signed
in its name and behalf by its duly authorized officers, all as of the day and
year first above written.
Duke Capital Corporation
By: _________________________________
Attest:
_____________________________
The Chase Manhattan Bank,
as Trustee
By: _________________________________
Attest:
_____________________________
6
<PAGE>
EXHIBIT A
FORM OF
SERIES % SENIOR NOTE
DUE
No. CUSIP No.
DUKE CAPITAL CORPORATION
SERIES % SENIOR NOTE
DUE
Principal Amount:
Regular Record Date: close of business on the 15th calendar day prior to the
relevant Interest Payment Date
Original Issue Date: ,
Stated Maturity: ,
Interest Payment Dates: and
Interest Rate: % per annum
Authorized Denomination: $ or any integral multiple thereof
Duke Capital Corporation, a Delaware corporation (the "Corporation," which term
includes any successor corporation under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay to ,
or registered assigns, the principal sum of DOLLARS ($ )
on the Stated Maturity shown above and to pay interest thereon from the Original
Issue Date shown above, or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, semi-annually in arrears on each
Interest Payment Date as specified above, commencing on the Interest Payment
Date next succeeding the Original Issue Date shown above and on the Stated
Maturity at the rate per annum shown above (the "Interest Rate") until the
principal hereof is paid or made available for payment and on any overdue
principal and on any overdue installment of interest. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date (other
than an Interest Payment Date that is the Stated Maturity or a Redemption Date)
will, as provided in the Indenture, be paid to the Person in whose name this
Series % Senior Note Due (this "Security") is registered on the Regular Record
Date as specified above next preceding such Interest Payment Date; provided that
any interest payable at Stated Maturity or on a Redemption Date will be paid to
the Person to whom principal is payable. Except as otherwise provided in the
Indenture, any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Security is registered at the
close of business on a Special Record Date for the payment of such Defaulted
Interest to be fixed by the Trustee, notice whereof shall be given to Holders of
Securities of this series not less than 10 days prior to such Special Record
Date, or be paid at any time in any other lawful manner not inconsistent
A-1
<PAGE>
with the requirements of any securities exchange, if any, on which the
Securities of this series shall be listed, and upon such notice as may be
required by any such exchange, all as more fully provided in the Indenture.
Payments of interest on this Security will include interest accrued to but
excluding the respective Interest Payment Dates. Interest payments for this
Security shall be computed and paid 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 this
Security 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 payment in respect of any such delay) with the same
force and effect as if made on the date the payment was originally payable.
"Business Day" means a day other than (i) a Saturday or a Sunday, (ii) a day on
which banking institutions in New York, New York are authorized or obligated by
law or executive order to remain closed or (iii) a day on which the Corporate
Trust Office is closed for business.
Payment of principal of, premium, if any, and interest on the Securities of
this series shall be made in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts. Payments of principal of, premium, if any, and interest on
Securities of this series represented by a Global Security shall be made by
wire transfer of immediately available funds to the Holder of such Global
Security, provided that, in the case of payments of principal and premium, if
any, such Global Security is first surrendered to the Paying Agent. If any of
the Securities of this series are no longer represented by a Global Security,
(i) payments of principal, premium, if any, and interest due at the Stated
Maturity or earlier redemption of such Securities shall be made at the office
of the Paying Agent upon surrender of such Securities to the Paying Agent and
(ii) payments of interest shall be made, at the option of the Corporation,
subject to such surrender where applicable, (A) by check mailed to the address
of the Person entitled thereto as such address shall appear in the Security
Register or (B) by wire transfer at such place and to such account at a banking
institution in the United States as may be designated in writing to the Trustee
at least sixteen (16) days prior to the date for payment by the Person entitled
thereto.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS SECURITY SET FORTH
ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE
SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been executed by the
Trustee by manual signature, this Security shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
A-2
<PAGE>
IN WITNESS WHEREOF, the Corporation has caused this instrument to be duly
executed under its corporate seal.
Dated:
Duke Capital Corporation
By: _________________________________
Attest:
_____________________________________
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to in
the within-mentioned Indenture.
The Chase Manhattan Bank, as Trustee
By: _________________________________
A-3
<PAGE>
(REVERSE SIDE OF SECURITY)
This Security is one of a duly authorized issue of Securities of the
Corporation (the "Securities"), issued and issuable in one or more series under
a Senior Indenture, dated as of April 1, 1998, as supplemented (the
"Indenture"), between the Corporation and The Chase Manhattan Bank, as Trustee
(the "Trustee," which term includes any successor trustee under the Indenture),
to which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights, limitation of rights, duties and
immunities thereunder of the Corporation, the Trustee and the Holders of the
Securities issued thereunder and of the terms upon which said Securities are,
and are to be, authenticated and delivered. This Security is one of the series
designated on the face hereof as Series % Senior Notes Due in the
aggregate principal amount of up to $ . Capitalized terms used herein
for which no definition is provided herein shall have the meanings set forth in
the Indenture.
The Securities of this series will be redeemable, in whole or from time to time
in part, at the option of the Corporation on any date (a "Redemption Date"), at
a Redemption Price equal to the greater of (i) 100% of the principal amount of
the Securities of this series to be redeemed and (ii) the sum of the present
values of the remaining scheduled payments of principal and interest thereon
(exclusive of interest accrued to such Redemption Date) discounted to such
Redemption Date on a semi-annual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Treasury Rate plus basis points, plus, in either
case, accrued and unpaid interest on the principal amount being redeemed to
such Redemption Date.
"Treasury Rate" means, with respect to any Redemption Date for the Securities
of this series, (i) the yield, under the heading which represents the average
for the immediately preceding week, appearing in the most recently published
statistical release designated "H.15(519)" or any successor publication which
is published weekly by the Board of Governors of the Federal Reserve System 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 Comparable Treasury Issue (if no maturity
is within three months before or after the Stated Maturity, yields for the two
published maturities most closely corresponding to the Comparable Treasury
Issue shall be determined and the 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, calculated using 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. The Treasury Rate shall be
calculated on the third Business Day preceding the Redemption Date.
"Comparable Treasury Issue" means the United States Treasury security selected
by the Independent Investment Banker as having a maturity comparable to the
remaining term of the Securities of this series to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of the Securities of this series.
"Independent Investment Banker" means and any successor firm or,
if such firm is unwilling or unable to select the Comparable Treasury Issue, an
independent
A-4
<PAGE>
investment banking institution of national standing appointed by the Trustee
after consultation with the Corporation.
"Comparable Treasury Price" means with respect to any Redemption Date for the
Securities of this series (i) the average of Reference Treasury Dealer
Quotations for such Redemption Date, after excluding the highest and lowest
such Reference Treasury Dealer Quotations, or (ii) if the Trustee obtains fewer
than such Reference Treasury Dealer Quotations, the average of all such
quotations.
"Reference Treasury Dealer" means each of , ,
, , and and
their respective successors; provided, however, that if any of the foregoing
shall cease to be a primary U.S. Government securities dealer in New York City
(a "Primary Treasury Dealer"), the Corporation will substitute therefor another
Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any Redemption Date, 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.
Notice of any redemption by the Corporation will be mailed at least 30 days but
not more than 60 days before any Redemption Date to each Holder of Securities
of this series to be redeemed. If less than all the Securities of this series
are to be redeemed at the option of the Corporation, the Trustee shall select,
in such manner as it shall deem fair and appropriate, the Securities of this
series to be redeemed in whole or in part. The Trustee may select for
redemption Securities of this series and portions of Securities of this series
in amounts of whole multiples of $ .
If an Event of Default with respect to the Securities of this series shall
occur and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner, with the effect and subject to the
conditions provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Corporation and the rights of the Holders of the Securities of all series
affected under the Indenture at any time by the Corporation and the Trustee
with the consent of the Holders of not less than a majority in principal amount
of the Outstanding Securities of all series affected thereby (voting as one
class). The Indenture contains provisions permitting the Holders of not less
than a majority in principal amount of the Outstanding Securities of all series
with respect to which a default under the Indenture shall have occurred and be
continuing (voting as one class), on behalf of the Holders of the Securities of
all such series, to waive, with certain exceptions, such default under the
Indenture and its consequences. The Indenture also permits the Holders of not
less than a majority in principal amount of the Securities of each series at
the time Outstanding, on behalf of the Holders of all Securities of such
series, to waive compliance by the Corporation with certain provisions of the
Indenture affecting such series. Any
A-5
<PAGE>
such consent or waiver by the Holder of this Security shall be conclusive and
binding upon such Holder and upon all future Holders of this Security and of
any Security issued upon the registration of transfer hereof or in exchange
hereof or in lieu hereof, whether or not notation of such consent or waiver is
made upon this Security.
No reference herein to the Indenture and no provision of this Security or of
the Indenture shall alter or impair the obligation of the Corporation, which is
absolute and unconditional, to pay the principal of and interest on this
Security at the times, place and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Security Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Corporation for such purpose, duly endorsed by, or accompanied by
a written instrument of transfer in form satisfactory to the Corporation and
the Security Registrar and duly executed by, the Holder hereof or his attorney
duly authorized in writing, and thereupon one or more new Securities of this
series, of authorized denominations and of like tenor and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees. No service charge shall be made for any such registration of
transfer or exchange, but the Corporation may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
As provided in and subject to the provisions of the Indenture, the Holder of
this Security shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than a majority in principal
amount of the Securities of this series at the time Outstanding shall have made
written request to the Trustee to institute proceedings in respect of such
Event of Default as Trustee and offered the Trustee reasonable indemnity, and
the Trustee shall not have received from the Holders of a majority in principal
amount of Securities of this series at the time Outstanding a direction
inconsistent with such request and shall have failed to institute any such
proceeding for 60 days after receipt of such notice, request and offer of
indemnity. The foregoing shall not apply to any suit instituted by the Holder
of this Security for the enforcement of any payment of principal hereof or any
premium or interest hereon on or after the respective due dates expressed
herein.
The Indenture contains provisions for defeasance at any time of the entire
indebtedness of the Securities of this series and for covenant defeasance at
any time of certain covenants in the Indenture upon compliance with certain
conditions set forth in the Indenture.
Prior to due presentment of this Security for registration of transfer, the
Corporation, the Trustee and any agent of the Corporation or the Trustee may
treat the Person in whose name this Security is registered as the owner hereof
for all purposes, whether or not this Security be overdue, and neither the
Corporation, the Trustee nor any such agent shall be affected by notice to the
contrary.
The Securities of this series are issuable only in registered form without
coupons in denominations of $ and any integral multiple thereof. As provided
in the Indenture and subject to the limitations
A-6
<PAGE>
therein set forth, Securities of this series are exchangeable for a like
aggregate principal amount of Securities of this series of a different
authorized denomination, as requested by the Holder surrendering the same upon
surrender of the Security or Securities to be exchanged at the office or agency
of the Corporation.
This Security shall be governed by, and construed in accordance with, the
internal laws of the State of New York.
A-7
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
UNIF GIFT MIN ACT -- _____ Custodian ______
TEN COM -- as tenants in common (Cust) (Minor)
TEN ENT -- as tenants by the entireties
under Uniform Gifts to
Minors Act _____________
(State)
JT TEN -- as joint tenants with rights of
survivorship and not as tenants
in common
Additional abbreviations may also be used though not on the above list.
- --------------------------------------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto _______
_______ (please insert Social Security or other identifying number of assignee)
- --------------------------------------------------------------------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF
ASSIGNEE
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing
- --------------------------------------------------------------------------------
agent to transfer said Security on the books of the Corporation, with full
power of substitution in the premises.
Dated: __________________________
------------------------------------------
------------------------------------------
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the within instrument in
every particular without alteration or
enlargement, or any change whatever.
A-8
<PAGE>
EXHIBIT B
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to in
the within-mentioned Indenture.
The Chase Manhattan Bank, as Trustee
By: _________________________________
Authorized Officer
B-9
<PAGE>
EXHIBIT 4.3
DUKE CAPITAL CORPORATION
TO
THE CHASE MANHATTAN BANK
Trustee
____________________________________________
Subordinated Indenture
Dated as of April 1, 1998
____________________________________________
<PAGE>
.......................
CERTAIN SECTIONS OF THIS INDENTURE RELATING TO SECTIONS 310 THROUGH 318,
INCLUSIVE, OF THE TRUST INDENTURE ACT OF 1939:
TRUST INDENTURE
ACT SECTION INDENTURE SECTION
- --------------- -----------------
Section 310(a)(1) ................................... 609
(a)(2) ................................... 609
(a)(3) ................................... Not Applicable
(a)(4) ................................... Not Applicable
(b) ................................... 608
610
Section 311(a) ................................... 613
(b) ................................... 613
Section 312(a) ................................... 701
702
(b) ................................... 702
(c) ................................... 702
Section 313(a) ................................... 703
(b) ................................... 703
(c) ................................... 703
(d) ................................... 703
Section 314(a) ................................... 704
(a)(4) ................................... 101
1004
(b) ................................... Not Applicable
(c)(1) ................................... 102
(c)(2) ................................... 102
(c)(3) ................................... Not Applicable
(d) ................................... Not Applicable
(e) ................................... 102
Section 315(a) ................................... 601
(b) ................................... 602
(c) ................................... 601
(d) ................................... 601
(e) ................................... 514
Section 316(a) ................................... 101
(a)(1)(A) ................................... 502
512
(a)(1)(B) ................................... 513
(a)(2) ................................... Not Applicable
(b) ................................... 508
(c) ................................... 104
Section 317(a)(1) ................................... 503
(a)(2) ................................... 504
(b) ................................... 1003
Section 318(a) ................................... 107
- ---------------
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.
<PAGE>
TABLE OF CONTENTS
PAGE
----
Parties................................................................1
Recitals of the Corporation............................................1
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions........................................ 1
Section 102. Compliance Certificates and Opinions............... 7
Section 103. Form of Documents Delivered to Trustee............. 7
Section 104. Acts of Holders; Record Dates...................... 8
Section 105. Notices, Etc., to Trustee and Corporation.......... 10
Section 106. Notice to Holders; Waiver.......................... 11
Section 107. Conflict with Trust Indenture Act.................. 11
Section 108. Effect of Headings and Table of Contents........... 11
Section 109. Successors and Assigns............................. 11
Section 110. Separability Clause................................ 11
Section 111. Benefits of Indenture.............................. 12
Section 112. Governing Law...................................... 12
Section 113. Legal Holidays..................................... 12
ARTICLE TWO
Security Forms
Section 201. Forms Generally.................................... 12
Section 202. Form of Face of Security........................... 13
Section 203. Form of Reverse of Security........................ 14
Section 204. Form of Legend for Global Securities............... 18
Section 205. Form of Trustee's Certificate of Authentication.... 18
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series............... 20
Section 302. Denominations...................................... 23
Section 303. Execution, Authentication, Delivery and Dating..... 23
Section 304. Temporary Securities............................... 25
Section 305. Registration, Registration of Transfer and
Exchange........................................... 25
Section 306. Mutilated, Destroyed, Lost and Stolen Securities... 28
Section 307. Payment of Interest; Interest Rights Preserved..... 27
Section 308. Persons Deemed Owners.............................. 29
Section 309. Cancellation....................................... 29
Section 310. Computation of Interest............................ 29
Section 311. CUSIP Numbers...................................... 29
(i)
<PAGE>
ARTICLE FOUR
PAGE
----
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture............ 30
Section 402. Application of Trust Money......................... 31
ARTICLE FIVE
Remedies
Section 501. Events of Default.................................. 31
Section 502. Acceleration of Maturity; Rescission and
Annulment.......................................... 33
Section 503. Collection of Indebtedness and Suits for
Enforcement by Trustee............................. 34
Section 504. Trustee May File Proofs of Claim................... 34
Section 505. Trustee May Enforce Claims Without Possession of
Securities......................................... 35
Section 506. Application of Money Collected..................... 35
Section 507. Limitation on Suits................................ 35
Section 508. Unconditional Right of Holders to Receive
Principal, Premium and Interest.................... 36
Section 509. Restoration of Rights and Remedies................. 36
Section 510. Rights and Remedies Cumulative..................... 36
Section 511. Delay or Omission Not Waiver....................... 36
Section 512. Control By Holders................................. 37
Section 513. Waiver of Past Defaults............................ 37
Section 514. Undertaking for Costs.............................. 37
Section 515. Waiver of Stay or Extension Laws................... 38
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities................ 38
Section 602. Notice of Defaults................................. 38
Section 603. Certain Rights of Trustee.......................... 38
Section 604. Not Responsible for Recitals or Issuance of
Securities......................................... 39
Section 605. May Hold Securities................................ 40
Section 606. Money Held in Trust................................ 40
Section 607. Compensation and Reimbursement..................... 40
Section 608. Conflicting Interests.............................. 41
Section 609. Corporate Trustee Required; Eligibility............ 41
Section 610. Resignation and Removal; Appointment of Successor.. 41
Section 611. Acceptance of Appointment by Successor............. 42
Section 612. Merger, Conversion, Consolidation or Succession
to Business........................................ 43
Section 613. Preferential Collection of Claims Against
Corporation........................................ 44
Section 614. Appointment of Authenticating Agent................ 44
(ii)
<PAGE>
ARTICLE SEVEN
PAGE
----
Holders' Lists and Reports by Trustee and Corporation
Section 701. Corporation to Furnish Trustee Names and
Addresses of Holders............................... 46
Section 702. Preservation of Information; Communications to
Holders............................................ 46
Section 703. Reports by Trustee................................. 46
Section 704. Reports by Corporation............................. 47
ARTICLE EIGHT
Consolidation, Merger, Conveyance or Transfer
Section 801. Corporation May Consolidate, Etc., on Certain
Terms.............................................. 47
Section 802. Successor Substituted.............................. 47
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of
Holders............................................ 48
Section 902. Supplemental Indentures With Consent of Holders.... 49
Section 903. Execution of Supplemental Indentures............... 50
Section 904. Effect of Supplemental Indentures.................. 50
Section 905. Conformity with Trust Indenture Act................ 50
Section 906. Reference in Securities to Supplemental
Indentures......................................... 50
Section 907. Subordination Unimpaired........................... 50
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest......... 51
Section 1002. Maintenance of Office or Agency.................... 51
Section 1003. Money for Securities Payments to Be Held in Trust.. 51
Section 1004. Statement by Officers as to Default................ 52
Section 1005. Waiver of Certain Covenants........................ 53
Section 1006. Calculation of Original Issue Discount............. 53
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article........................... 54
Section 1102. Election to Redeem; Notice to Trustee.............. 54
Section 1103. Selection by Trustee of Securities to Be Redeemed.. 54
Section 1104. Notice of Redemption............................... 55
Section 1105. Securities Payable on Redemption Date.............. 56
Section 1106. Securities Redeemed in Part........................ 56
(iii)
<PAGE>
ARTICLE TWELVE
PAGE
----
Sinking Funds
Section 1201. Applicability of Article........................... 57
Section 1202. Satisfaction of Sinking Fund Payments with
Securities......................................... 57
Section 1203. Redemption of Securities for Sinking Fund.......... 57
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Applicability of Article........................... 58
Section 1302. Defeasance and Discharge........................... 58
Section 1303. Covenant Defeasance................................ 59
Section 1304. Conditions to Defeasance or Covenant Defeasance.... 59
Section 1305. Deposited Money and Government Obligations to Be
Held in Trust; Miscellaneous Provisions............ 60
ARTICLE FOURTEEN
Subordination
Section 1401. Securities Subordinated to Senior Indebtedness..... 61
Section 1402. Disputes with Holders of Certain Senior
Indebtedness....................................... 63
Section 1403. Subrogation........................................ 63
Section 1404. Obligation of Corporation Unconditional............ 63
Section 1405. Payments on Securities Permitted................... 64
Section 1406. Effectuation of Subordination by Trustee........... 64
Section 1407. Knowledge of Trustee............................... 65
Section 1408. Trustee May Hold Senior Indebtedness............... 65
Section 1409. Rights of Holders of Senior Indebtedness Not
Impaired........................................... 65
Section 1410. Trust Moneys Not Subordinated...................... 65
Section 1411. Article Applicable to Paying Agents................ 66
Section 1412. Trustee; Compensation Not Prejudiced............... 66
ARTICLE FIFTEEN
Immunity of Incorporators, Stockholders, Officers and Directors
Section 1501. Indenture and Securities Solely Corporate
Obligations........................................ 66
Testimonium.......................................................... 67
Signatures and Seals................................................. 67
(iv)
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INDENTURE, dated as of April 1, 1998, between Duke Capital
Corporation, a corporation duly organized and existing under the laws of the
State of Delaware (herein called the "Corporation"), having its principal office
at 422 South Church Street, Charlotte, North Carolina 28202, and The Chase
Manhattan Bank, a New York banking corporation, as Trustee (herein called the
"Trustee").
RECITALS OF THE CORPORATION
The Corporation has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
subordinated debentures, notes or other evidences of indebtedness (herein called
the "Securities"), to be issued in one or more series as in this Indenture
provided.
All things necessary to make this Indenture a valid agreement of the
Corporation, in accordance with its terms, have been done.
Now, Therefore, This Indenture Witnesseth:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles, and, except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect to any computation
required or permitted hereunder shall mean such accounting principles as
are generally accepted in the United States of America;
(4) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may
be, of this Indenture; and
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(5) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"Act," when used with respect to any Holder, has the meaning specified
in Section 104.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 614 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Board of Directors" means either the board of directors of the
Corporation or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Corporation 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," when used with respect to any Place of Payment, means
a day other than (i) a Saturday or a Sunday, (ii) a day on which banking
institutions in that Place of Payment are authorized or obligated by law or
executive order to remain closed or (iii) a day on which the Corporate Trust
Office of the Trustee is closed for business.
"Commission" means the Securities and Exchange Commission, from time
to time constituted, created under the Exchange Act, or, if at any time after
the execution of this instrument such Commission is not existing and performing
the duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Corporation" means the Person named as the "Corporation" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Corporation" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Corporation by its Chairman of the Board, its
President or a Vice President, and by its Treasurer, an Assistant Treasurer, its
Secretary or an Assistant Secretary, and delivered to the Trustee.
"Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered, which office at the date hereof is located at 450 West 33rd
Street, New York, New York 10001.
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"corporation" means a corporation, association, company, joint-stock
company or business trust.
"Covenant Defeasance" has the meaning specified in Section 1303.
"Defaulted Interest" has the meaning specified in Section 307.
"Defeasance" has the meaning specified in Section 1302.
"Depositary" means, with respect to Securities of any series issuable
in whole or in part in the form of one or more Global Securities, a clearing
agency registered under the Exchange Act that is designated to act as Depositary
for such Securities as contemplated by Section 301.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 104.
"Global Security" means a Security that evidences all or part of the
Securities of any series which is issued to a Depositary or a nominee thereof
for such series in accordance with Section 301(17).
"Government Obligation" has the meaning specified in Section 1304.
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indenture" means this instrument as originally executed and as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the terms of particular
series of Securities established as contemplated by Section 301.
"interest," when used with respect to an Original Issue Discount
Security which by its terms bears interest only after Maturity, means interest
payable after Maturity.
"Interest Payment Date," when used with respect to any Security, means
the Stated Maturity of an installment of interest on such Security.
"Investment Company Act" means the Investment Company Act of 1940 and
any statute successor thereto, in each case as amended from time to time.
"Maturity," when used with respect to any Security, means the date on
which the principal of such Security or an installment of principal becomes due
and payable as
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therein or herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
"Notice of Default" means a written notice of the kind specified in
Section 501(4).
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, the President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary, of the Corporation, and
delivered to the Trustee. One of the officers signing an Officers' Certificate
given pursuant to Section 1004 shall be the principal executive, financial or
accounting officer of the Corporation.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Corporation, or other counsel who shall be reasonably acceptable
to the Trustee.
"Original Issue Discount Security" means any Security which provides
for an amount less than the principal amount thereof to be due and payable upon
a declaration of acceleration of the Maturity thereof pursuant to Section 502.
"Outstanding," when used with respect to Securities, means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
(1) Securities theretofore cancelled by the Trustee or delivered to
the Trustee for cancellation;
(2) Securities for whose payment or redemption the necessary amount of
money or money's worth has been theretofore deposited with the Trustee or
any Paying Agent (other than the Corporation) in trust or set aside and
segregated in trust by the Corporation (if the Corporation shall act as its
own Paying Agent) for the Holders of such Securities; provided that, if
such Securities are to be redeemed, notice of such redemption has been duly
given pursuant to this Indenture or provision therefor satisfactory to the
Trustee has been made;
(3) Securities as to which Defeasance has been effected pursuant to
Section 1302; and
(4) Securities which have been paid pursuant to Section 306 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands such Securities are valid obligations of the Corporation;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder as of any date, (A) the principal amount of an Original Issue
Discount Security which shall be deemed to be Outstanding shall be the amount of
the principal thereof which would be due and payable as of such date upon
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acceleration of the Maturity thereof to such date pursuant to Section 502, (B)
if, as of such date, the principal amount payable at the Stated Maturity of a
Security is not determinable, the principal amount of such Security which shall
be deemed to be Outstanding shall be the amount as specified or determined as
contemplated by Section 301, (C) the principal amount of a Security denominated
in one or more foreign currencies or currency units which shall be deemed to be
Outstanding shall be the U.S. dollar equivalent, determined as of such date in
the manner provided as contemplated by Section 301, of the principal amount of
such Security (or, in the case of a Security described in Clause (A) or (B)
above, of the amount determined as provided in such Clause), and (D) Securities
owned by the Corporation or any other obligor upon the Securities or any
Affiliate of the Corporation or of such other obligor, whether of record or
beneficially, shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent, waiver or other
action, only Securities which the Trustee actually knows to be so owned shall be
so disregarded. Securities so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Corporation or any other obligor upon the Securities or
any Affiliate of the Corporation or of such other obligor.
"Paying Agent" means any Person authorized by the Corporation to pay
the principal of or any premium or interest on any Securities on behalf of the
Corporation.
"Periodic Offering" means an offering of Securities of a series from
time to time the specific terms of which Securities, including without
limitation the rate or rates of interest or formula for determining the rate or
rates of interest thereon, if any, the Stated Maturity or Maturities thereof and
the redemption provisions, if any, with respect thereto, are to be determined by
the Corporation upon the issuance of such Securities.
"Person" means any individual, corporation, partnership, limited
liability company or corporation, joint venture, trust, unincorporated
organization or government or any agency or political subdivision thereof.
"Place of Payment", when used with respect to the Securities of any
series, means the place or places where the principal of and any premium and
interest on the Securities of that series are payable as specified as
contemplated by Section 301.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Redemption Date," when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price," when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
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"Regular Record Date" for the interest payable on any Interest Payment
Date on the Securities of any series means the date specified for that purpose
as contemplated by Section 301.
"Responsible Officer," when used with respect to the Trustee, means
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 secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any senior trust officer, any trust officer or assistant
trust officer, the controller or any assistant controller or any other 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.
"Securities" has the meaning stated in the first recital of this
Indenture and more particularly means any Securities authenticated and delivered
under this Indenture.
"Securities Act" means the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Senior Indebtedness" means with respect to any series of Securities,
the principal of, and premium, if any, and interest on and any other payment in
respect of indebtedness due pursuant to any of the following, whether
outstanding at the date of execution of this Indenture or thereafter incurred,
created or assumed: (a) all indebtedness of the Corporation evidenced by notes,
debentures, bonds or other securities sold by the Corporation for money or other
obligations for money borrowed, (b) all indebtedness of others of the kinds
described in the preceding clause (a) assumed by or guaranteed in any manner by
the Corporation or in effect guaranteed by the Corporation through an agreement
to purchase, contingent or otherwise, and (c) all renewals, extensions or
refundings of indebtedness of the kinds described in either of the preceding
clauses (a) and (b), unless, in the case of any particular indebtedness,
renewal, extension or refunding, the instrument creating or evidencing the same
or the assumption or guarantee of the same by its terms provides that such
indebtedness, renewal, extension or refunding is not superior in right of
payment to or is pari passu with such Securities.
"Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity," when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security as the date on which the principal of such Security or
such installment of principal or interest is due and payable, in the case of
such principal, as such date may be advanced or extended as provided pursuant to
the terms of such Security and this Indenture.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided, however,
that in the event the Trust
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Indenture Act of 1939 is amended after such date, "Trust Indenture Act" shall
mean, to the extent required by any such amendment, the Trust Indenture Act of
1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who is then a Trustee hereunder, and
if at any time there is more than one such Person, "Trustee" as used with
respect to the Securities of any series shall mean the Trustee with respect to
Securities of that series.
"Vice President," when used with respect to the Corporation or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president."
Section 102. Compliance Certificates and Opinions.
Upon any application or request by the Corporation to the Trustee to
take any action under any provision of this Indenture, the Corporation shall
furnish to the Trustee such certificates and opinions as may be required under
the Trust Indenture Act. Each such certificate or opinion shall be given in the
form of an Officers' Certificate, if to be given by an officer of the
Corporation, or an Opinion of Counsel, if to be given by counsel, and shall
comply with the requirements of the Trust Indenture Act and any other
requirements set forth in this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
Section 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
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Any certificate or opinion of an officer of the Corporation may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Corporation stating that the
information with respect to such factual matters is in the possession of the
Corporation, unless such counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever, subsequent to the receipt by the Trustee of any Board
Resolution, Officers' Certificate, Opinion of Counsel or other document or
instrument, a clerical, typographical or other inadvertent or unintentional
error or omission shall be discovered therein, a new document or instrument may
be substituted therefor in corrected form with the same force and effect as if
originally filed in the corrected form and, irrespective of the date or dates of
the actual execution and/or delivery thereof, such substitute document or
instrument shall be deemed to have been executed and/or delivered as of the date
or dates required with respect to the document or instrument for which it is
substituted. Anything in this Indenture to the contrary notwithstanding, if any
such corrective document or instrument indicates that action has been taken by
or at the request of the Corporation which could not have been taken had the
original document or instrument not contained such error or omission, the action
so taken shall not be invalidated or otherwise rendered ineffective but shall be
and remain in full force and effect, except to the extent that such action was a
result of willful misconduct or bad faith. Without limiting the generality of
the foregoing, any Securities issued under the authority of such defective
document or instrument shall nevertheless be the valid obligations of the
Corporation entitled to the benefits of this Indenture equally and ratably with
all other Outstanding Securities, except as aforesaid.
Section 104. Acts of Holders; Record Dates.
Any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Indenture to be given, made or
taken by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Corporation.
Such instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the Trustee and
the Corporation, if made in the manner provided in this Section.
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The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is
by a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
The ownership of Securities shall be proved by the Security Register.
Any request, demand, authorization, direction, notice, consent, waiver or
other Act of the Holder of any Security shall bind every future Holder of the
same Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Corporation
in reliance thereon, whether or not notation of such action is made upon such
Security.
The Corporation may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Securities of such series; provided that the
Corporation may not set a record date for, and the provisions of this paragraph
shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in the next paragraph. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other Holders,
shall be entitled to take or revoke the relevant action, whether or not such
Holders remain Holders after such record date; provided that no such action
shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Corporation from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Corporation, at its own expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Trustee in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 106.
The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to join
in the giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 502, (iii) any request to institute
proceedings referred to in Section 507(2) or (iv) any direction referred to in
Section 512, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request
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or direction or to revoke the same, whether or not such Holders remain Holders
after such record date; provided that no such action shall be effective
hereunder unless taken on or prior to the applicable Expiration Date by Holders
of the requisite principal amount of Outstanding Securities of such series on
such record date. Nothing in this paragraph shall be construed to prevent the
Trustee from setting a new record date for any action for which a record date
has previously been set pursuant to this paragraph (whereupon the record date
previously set shall automatically and with no action by any Person be cancelled
and of no effect), and nothing in this paragraph shall be construed to render
ineffective any action taken by Holders of the requisite principal amount of
Outstanding Securities of the relevant series on the date such action is taken.
Promptly after any record date is set pursuant to this paragraph, the Trustee,
at the Corporation's expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration Date to be sent to the
Corporation in writing and to each Holder of Securities of the relevant series
in the manner set forth in Section 106.
With respect to any record date set pursuant to this Section, the
party hereto which sets such record dates may designate any day as the
"Expiration Date" and from time to time may change the Expiration Date to any
earlier or later day; provided that no such change shall be effective unless
notice of the proposed new Expiration Date is given to the other party hereto in
writing, and to each Holder of Securities of the relevant series in the manner
set forth in Section 106, on or prior to the existing Expiration Date. If an
Expiration Date is not designated with respect to any record date set pursuant
to this Section, the party hereto which set such record date shall be deemed to
have initially designated the 180th day after such record date as the Expiration
Date with respect thereto, subject to its right to change the Expiration Date as
provided in this paragraph. Notwithstanding the foregoing, no Expiration Date
shall be later than the 180th day after the applicable record date.
Without limiting the foregoing, a Holder entitled hereunder to take
any action hereunder with regard to any particular Security may do so with
regard to all or any part of the principal amount of such Security or by one or
more duly appointed agents each of which may do so pursuant to such appointment
with regard to all or any part of such principal amount.
Section 105. Notices, Etc., to Trustee and Corporation.
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Corporation shall be
sufficient for every purpose hereunder if made, given, furnished or filed
in writing to or with the Trustee at its Corporate Trust Office, Attention:
Corporate Trustee Administration, or
(2) the Corporation by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to the
Corporation addressed to it at the address of its principal office
specified in the first paragraph of this instrument, Attention: Treasurer,
or at any other address previously furnished in writing to the Trustee by
the Corporation.
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Section 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address as it appears in the Security Register, not later
than the latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice. In any case where notice to Holders
is given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Indenture provides for notice
in any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Trustee, but such filing shall not be a condition precedent to the validity
of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
Section 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act which is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act which may be so modified or excluded, the latter provision shall
be deemed to apply to this Indenture as so modified or to be excluded, as the
case may be.
Section 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Corporation
shall bind its successors and assigns, whether so expressed or not.
Section 110. Separability Clause.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
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Section 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto, their successors
hereunder, the holders of Senior Indebtedness and the Holders, any benefit or
any legal or equitable right, remedy or claim under this Indenture.
Section 112. Governing Law.
This Indenture and the Securities shall be governed by and construed
in accordance with the laws of the State of New York, without regard to
conflicts of laws principles thereof.
Section 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day at any Place of Payment,
then (notwithstanding any other provision of this Indenture or of the Securities
(other than a provision of any Security which specifically states that such
provision shall apply in lieu of this Section)) payment of interest or principal
(and premium, if any) need not be made at such Place of Payment on such date,
but may be made on the next succeeding Business Day at such Place of Payment
with the same force and effect as if made on the Interest Payment Date or
Redemption Date, or at the Stated Maturity.
ARTICLE TWO
Security Forms
Section 201. Forms Generally.
The Securities of each series shall be in substantially the form set
forth in this Article, or in such other form as shall be established by or
pursuant to a Board Resolution or in one or more indentures supplemental hereto,
in each case with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture, and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or Depositary therefor or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution thereof. If the form of Securities of any series is established by
action taken pursuant to a Board Resolution, a copy of an appropriate record of
such action shall be certified by the Secretary or an Assistant Secretary of the
Corporation and delivered to the Trustee at or prior to the delivery of the
Company Order contemplated by Section 303 for the authentication and delivery of
such Securities.
The definitive Securities shall be printed, lithographed or engraved
on steel engraved borders or may be produced in any other manner, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
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Section 202. Form of Face of Security.
[Insert any legend required by the Internal Revenue Code and the
regulations thereunder.]
DUKE CAPITAL CORPORATION
_____________________
No. _________ $ __________
CUSIP No. ____
Duke Capital Corporation, a corporation duly organized and existing
under the laws of the State of Delaware (herein called the "Corporation," 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
_________________________ [if the Security is to bear interest prior to Maturity
and interest payment periods are not extendable, insert - , and to pay interest
thereon from __________ or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, [insert - semi-annually, quarterly,
monthly or other description of the relevant payment period] on [________,
________,] and __________ in each year, commencing _______________, at the rate
of ____% per annum, until the principal hereof is paid or made available for
payment [if applicable, insert - , provided that any principal and premium, and
any such installment of interest, which is overdue shall bear interest at the
rate of ___% per annum (to the extent that the payment of such interest shall be
legally enforceable), from the dates such amounts are due until they are paid or
made available for payment, and such interest shall be payable on demand]. The
interest so payable, and punctually paid or duly provided for, on any Interest
Payment Date will, as provided in such Indenture, be paid to the Person in whose
name this Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest, which shall be
the [___________________] (whether or not a Business Day), as the case may be,
next preceding such Interest Payment Date. Any such interest not so punctually
paid or duly provided for will forthwith cease to be payable to the Holder on
such Regular Record Date and may either be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to Holders of Securities
of this series not less than 10 days prior to such Special Record Date, or be
paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities of this series
may be listed, and upon such notice as may be required by such exchange, all as
more fully provided in said Indenture].
[If the Security is not to bear interest prior to Maturity, insert -
The principal of this Security shall not bear interest except in the case of a
default in payment of principal upon acceleration, upon redemption or at Stated
Maturity and in such case the overdue principal and any overdue premium shall
bear interest at the rate of ____% per annum (to the extent that the payment of
such interest shall be legally enforceable), from the dates such amounts are due
until they are paid or made available for payment. Interest on any overdue
principal or premium shall be payable on demand. Any such interest on overdue
principal or premium which is not paid on demand shall bear interest at the rate
of ____% per annum (to the extent that the payment of such interest on interest
shall be legally enforceable), from the
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date of such demand until the amount so demanded is paid or made available for
payment. Interest on any overdue interest shall be payable on demand.]
Payment of the principal of (and premium, if any) and [if applicable,
insert - any such] interest on this Security will be made at the office or
agency of the Corporation maintained for that purpose in _________________, in
such coin or currency of the United States of America as at the time of payment
is legal tender for payment of public and private debts [if applicable, insert -
; provided, however, that at the option of the Corporation payment of interest
may be made by check mailed to the address of the Person entitled thereto as
such address shall appear in the Security Register or by wire transfer at such
place and to such account at a banking institution in the United States as may
be designated in writing to the Trustee at least sixteen (16) days prior to the
date for payment by the Person entitled thereto].
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Corporation has caused this instrument to be
duly executed under its corporate seal.
Dated: DUKE CAPITAL CORPORATION
By____________________________
Attest:
____________________________
Section 203. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the
Corporation (herein called the "Securities"), issued and to be issued in one or
more series under an Indenture, dated as of April 1, 1998 (herein called the
"Indenture," which term shall have the meaning assigned to it in such
instrument), between the Corporation and The Chase Manhattan Bank, as Trustee
(herein called the "Trustee," which term includes any successor trustee under
the Indenture), and reference is hereby made to the Indenture for a statement of
the respective rights, limitation of rights, duties and immunities thereunder of
the Corporation, the Trustee, the holders of Senior Indebtedness and the Holders
of the Securities and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated on
the face hereof [if applicable, insert - , limited in aggregate principal amount
to $__________].
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[If applicable, insert - The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, [if applicable, insert -
(1) on ____________ in any year commencing with the year _____ and ending with
the year _____ through operation of the sinking fund for this series at a
Redemption Price equal to 100% of the principal amount, and (2)] at any time [if
applicable, insert - on or after ___________, 19__], as a whole or in part, at
the election of the Corporation, at the following Redemption Prices (expressed
as percentages of the principal amount): If redeemed [if applicable, insert - on
or before _________________, ___%, and if redeemed] during the 12-month period
beginning _________ of the years indicated,
Year Redemption Price Year Redemption Price
------ ---------------- ---- ----------------
and thereafter at a Redemption Price equal to ____% of the principal amount,
together in the case of any such redemption [if applicable, insert - (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest installments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.]
[If applicable, insert - The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, (1) on ____________ in
any year commencing with the year ______ and ending with the year _____ through
operation of the sinking fund for this series at the Redemption Prices for
redemption through operation of the sinking fund (expressed as percentages of
the principal amount) set forth in the table below, and (2) at any time [if
applicable, insert - on or after _____________], as a whole or in part, at the
election of the Corporation, at the Redemption Prices for redemption otherwise
than through operation of the sinking fund (expressed as percentages of the
principal amount) set forth in the table below: If redeemed during the 12-month
period beginning ________ of the years indicated,
Redemption Price
for Redemption Price for
Redemption Through Redemption Otherwise Than
Operation of the Through Operation
Year Sinking Fund of the Sinking Fund
------ -------------------- --------------------------
and thereafter at a Redemption Price equal to _____% of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest installments whose Stated Maturity is on
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or prior to such Redemption Date will be payable to the Holders of such
Securities, or one or more Predecessor Securities, of record at the close of
business on the relevant Record Dates referred to on the face hereof, all as
provided in the Indenture.]
[If applicable, insert - Notwithstanding the foregoing, the
Corporation may not, prior to _________, redeem any Securities of this series as
contemplated by [if applicable, insert - Clause (2) of] the preceding paragraph
as a part of, or in anticipation of, any refunding operation by the application,
directly or indirectly, of moneys borrowed having an interest cost to the
Corporation (calculated in accordance with generally accepted financial
practice) of less than ____% per annum.]
[If applicable, insert - The sinking fund for this series provides
for the redemption on __________ in each year beginning with the year _______
and ending with the year ______ of [if applicable, insert - not less than
$___________ ("mandatory sinking fund") and not more than] $____________
aggregate principal amount of Securities of this series. Securities of this
series acquired or redeemed by the Corporation otherwise than through [if
applicable, insert - mandatory] sinking fund payments may be credited against
subsequent [if applicable, insert - mandatory] sinking fund payments otherwise
required to be made [if applicable, insert - , in the inverse order in which
they become due].]
[If the Security is subject to redemption of any kind, insert - In
the event of redemption of this Security in part only, a new Security or
Securities of this series and of like tenor for the unredeemed portion hereof
will be issued in the name of the Holder hereof upon the cancellation hereof.]
[If applicable, insert - The Indenture contains provisions for
defeasance at any time of [the entire indebtedness of this Security] [or]
[certain restrictive covenants and Events of Default with respect to this
Security] [, in each case] upon compliance with certain conditions set forth in
the Indenture.]
[If the Security is not an Original Issue Discount Security, insert -
If an Event of Default with respect to Securities of this series shall occur and
be continuing, the principal of the Securities of this series may be declared
due and payable in the manner and with the effect provided in the Indenture.]
[If the Security is an Original Issue Discount Security, insert - If
an Event of Default with respect to Securities of this series shall occur and be
continuing, an amount of principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to [insert formula for determining the
amount]. Upon payment (i) of the amount of principal so declared due and
payable and (ii) of interest on any overdue principal, premium and interest (in
each case to the extent that the payment of such interest shall be legally
enforceable), all of the Corporation's obligations in respect of the payment of
the principal of and premium and interest, if any, on the Securities of this
series shall terminate.]
The indebtedness represented by the Securities of this series is, to
the extent and in the manner set forth in the Indenture, expressly subordinated
in right of payment to the prior payment in full of all Senior Indebtedness, as
defined in the Indenture, with respect to
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this series, and this Security is issued subject to such provisions, and each
Holder of this Security, by acceptance thereof, agrees to and shall be bound by
such provisions and authorizes and directs the Trustee in his, her or its behalf
to take such action as may be necessary or appropriate to effectuate the
subordination as provided in the Indenture and appoints the Trustee his, her or
its attorney-in-fact, as the case may be, for any and all such purposes.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Corporation and the rights of the Holders of the Securities of all series
affected under the Indenture at any time by the Corporation and the Trustee with
the consent of the Holders of a majority in principal amount of the Securities
of all series at the time Outstanding affected thereby (voting as one class).
The Indenture contains provisions permitting the Holders of not less than a
majority in principal amount of the Securities of all series at the time
Outstanding with respect to which a default under the Indenture shall have
occurred and be continuing (voting as one class), on behalf of the Holders of
the Securities of all such series, to waive, with certain exceptions, such past
default with respect to all such series and its consequences. The Indenture
also permits the Holders of not less than a majority in principal amount of the
Securities of each series at the time Outstanding, on behalf of the Holders of
all Securities of such series, to waive compliance by the Corporation with
certain provisions of the Indenture. Any such consent or waiver by the Holder
of this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange therefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder, unless such Holder shall have previously given
the Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than a majority in principal
amount of the Securities of this series at the time Outstanding shall have made
written request to the Trustee to institute proceedings in respect of such Event
of Default as Trustee and offered the Trustee reasonable indemnity, and the
Trustee shall not have received from the Holders of a majority in principal
amount of Securities of this series at the time Outstanding a direction
inconsistent with such request, and shall have failed to institute any such
proceeding, for 60 days after receipt of such notice, request and offer of
indemnity. The foregoing shall not apply to any suit instituted by the Holder
of this Security for the enforcement of any payment of principal hereof or any
premium or interest hereon on or after the respective due dates expressed
herein.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Corporation,
which is absolute and unconditional, to pay the principal of and any premium and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Corporation in any place where the principal of and any
premium and interest on this Security are payable, duly
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<PAGE>
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Corporation and the Security Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Securities of this series and of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $1,000 and any integral multiple thereof.
As provided in the Indenture and subject to certain limitations therein set
forth, Securities of this series are exchangeable for a like aggregate principal
amount of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Corporation may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Corporation, the Trustee and any agent of the Corporation or the
Trustee may treat the Person in whose name this Security is registered as the
owner hereof for all purposes, whether or not this Security be overdue, and
neither the Corporation, the Trustee nor any such agent shall be affected by
notice to the contrary.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
Section 204. Form of Legend for Global Securities.
Unless otherwise specified as contemplated by Section 301 for the
Securities evidenced thereby, every Global Security authenticated and delivered
hereunder shall bear a legend in substantially the following form:
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 THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE
REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE
THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
Section 205. Form of Trustee's Certificate of Authentication.
The Trustee's certificate of authentication shall be in substantially
the following form:
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This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
THE CHASE MANHATTAN BANK,
As Trustee
By:____________________________
Authorized Officer
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ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series, with the
Securities issued hereunder being expressly subordinated in right of payment, to
the extent and in the manner set forth in Article Fourteen, to all Senior
Indebtedness of the Corporation. There shall be established in or pursuant to a
Board Resolution and, subject to Section 303, set forth, or determined in the
manner provided, in an Officers' Certificate, or established in one or more
indentures supplemental hereto, prior to the issuance of Securities of any
series,
(1) the title of the Securities of the series (which shall distinguish
the Securities of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the Securities of
the series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Section 304, 305, 306, 906 or 1106 and except for any
Securities which, pursuant to Section 303, are deemed never to have been
authenticated and delivered hereunder);
(3) the Person to whom any interest on a Security of the series shall
be payable, if other than the Person in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest;
(4) the date or dates on which the principal of any Securities of the
series is payable or the method by which such date shall be determined and
the right, if any, to shorten or extend the date on which the principal of
any Securities of the series is payable and the conditions to any such
change;
(5) the rate or rates at which any Securities of the series shall bear
interest, if any, or the method by which such rate or rates shall be
determined; the date or dates from which any such interest shall accrue;
the Interest Payment Dates on which any such interest shall be payable; the
manner (if any) of determination of such Interest Payment Dates; and the
Regular Record Date, if any, for any such interest payable on any Interest
Payment Date;
(6) the right, if any, to extend the interest payment periods and the
terms of such extension or extensions;
(7) the place or places where the principal of and any premium and
interest on any Securities of the series shall be payable and whether, if
acceptable to the
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Trustee, any principal of such Securities shall be payable without
presentation or surrender thereof;
(8) the period or periods within which, or the date or dates on which,
the price or prices at which and the terms and conditions upon which any
Securities of the series may be redeemed, in whole or in part, at the
option of the Corporation and, if other than by a Board Resolution, the
manner in which any election by the Corporation to redeem the Securities
shall be evidenced;
(9) the obligation, if any, of the Corporation to redeem or purchase
any Securities of the series pursuant to any sinking fund, purchase fund or
analogous provisions or at the option of the Holder thereof and the period
or periods within which, the price or prices at which and the terms and
conditions upon which any Securities of the series shall be redeemed or
purchased, in whole or in part, pursuant to such obligation;
(10) if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which any Securities of the series shall be
issuable;
(11) if the amount of principal of or any premium or interest on any
Securities of the series may be determined with reference to an index or
pursuant to a formula, the manner in which such amounts shall be
determined;
(12) if other than the currency of the United States of America, the
currency, currencies or currency units in which the principal of or any
premium or interest on any Securities of the series shall be payable and
the manner of determining the equivalent thereof in the currency of the
United States of America for any purpose, including for purposes of the
definition of "Outstanding" in Section 101;
(13) if the principal of or any premium or interest on any Securities
of the series is to be payable, at the election of the Corporation or the
Holder thereof, in one or more currencies or currency units other than
that or those in which such Securities are stated to be payable, the
currency, currencies or currency units in which the principal of or any
premium or interest on such Securities as to which such election is made
shall be payable, the periods within which and the terms and conditions
upon which such election is to be made and the amount so payable (or the
manner in which such amount shall be determined);
(14) if other than the entire principal amount thereof, the portion of
the principal amount of any Securities of the series which shall be payable
upon declaration of acceleration of the Maturity thereof pursuant to
Section 502;
(15) if the principal amount payable at the Stated Maturity of any
Securities of the series will not be determinable as of any one or more
dates prior to the Stated Maturity, the amount which shall be deemed to be
the principal amount of such Securities as of any such date for any purpose
thereunder or hereunder, including the principal amount thereof which shall
be due and payable upon any Maturity other than the Stated Maturity or
which shall be deemed to be Outstanding as of any date prior to
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the Stated Maturity (or, in any such case, the manner in which such amount
deemed to be the principal amount shall be determined);
(16) if either or both of Sections 1302 and 1303 do not apply to any
Securities of the series;
(17) if applicable, that any Securities of the series shall be
issuable in whole or in part in the form of one or more Global Securities
and, in such case, the respective Depositary or Depositaries for such
Global Securities, the form of any legend or legends which shall be borne
by any such Global Security in addition to or in lieu of that set forth in
Section 204 and any circumstances in addition to or in lieu of those set
forth in Clause (2) of the last paragraph of Section 305 in which any such
Global Security may be exchanged in whole or in part for Securities
registered, and any transfer of such Global Security in whole or in part
may be registered, in the name or names of Persons other than the
Depositary for such Global Security or a nominee thereof;
(18) any addition, modification or deletion of any Events of Default
or covenants provided with respect to any Securities of the series and any
change in the right of the Trustee or the requisite Holders of such
Securities to declare the principal amount thereof due and payable pursuant
to Section 502;
(19) any addition to or change in the covenants set forth in Article
Ten which applies to Securities of the series;
(20) the subordination of the Securities of such series to any other
indebtedness of the Corporation, including, without limitation, the
Securities of any other series; and
(21) any other terms of the series.
All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided in or pursuant
to the Board Resolution referred to above and (subject to Section 303) set
forth, or determined in the manner provided, in the Officers' Certificate
referred to above or in any such indenture supplemental hereto.
If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such action
shall be certified by the Secretary or an Assistant Secretary of the Corporation
and delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms or the manner of determining the terms of
the series.
With respect to Securities of a series offered in a Periodic Offering,
the Board Resolution (or action taken pursuant thereto), Officers' Certificate
or supplemental indenture referred to above may provide general terms or
parameters for Securities of such series and provide either that the specific
terms of particular Securities of such series shall be specified in a Company
Order or that such terms shall be determined by the Corporation in accordance
with other procedures specified in a Company Order as contemplated by the third
paragraph of Section 303.
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Notwithstanding Section 301(2) herein and unless otherwise expressly
provided with respect to a series of Securities, the aggregate principal amount
of a series of Securities may be increased and additional Securities of such
series may be issued up to the maximum aggregate principal amount authorized
with respect to such series as increased.
Section 302. Denominations.
The Securities of each series shall be issuable only in fully
registered form without coupons and only in such denominations as shall be
specified as contemplated by Section 301. In the absence of any such specified
denomination with respect to the Securities of any series, the Securities of
such series shall be issuable in denominations of $1,000 and any integral
multiple thereof.
Section 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Corporation by its
Chairman of the Board, its Vice Chairman of the Board, its President or one of
its Vice Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Corporation shall bind the
Corporation, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of
this Indenture, the Corporation may deliver Securities of any series executed by
the Corporation to the Trustee for authentication, together with a Company Order
for the authentication and delivery of such Securities, and the Trustee in
accordance with the Company Order shall authenticate and deliver such
Securities, provided, however, that in the case of Securities offered in a
Periodic Offering, the Trustee shall authenticate and deliver such Securities
from time to time in accordance with such other procedures (including, without
limitation, the receipt by the Trustee of oral or electronic instructions from
the Corporation or its duly authorized agents, promptly confirmed in writing)
acceptable to the Trustee as may be specified by or pursuant to a Company Order
delivered to the Trustee prior to the time of the first authentication of
Securities of such series. If the form or terms of the Securities of the series
have been established by or pursuant to one or more Board Resolutions as
permitted by Sections 201 and 301, in authenticating such Securities, and
accepting the additional responsibilities under this Indenture in relation to
such Securities, the Trustee shall be entitled to receive, and (subject to
Section 601) shall be fully protected in relying upon, an Opinion of Counsel
stating,
(1) if the form of such Securities has been established by or pursuant
to Board Resolution as permitted by Section 201, that such form has been
established in conformity with the provisions of this Indenture;
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(2) if the terms of such Securities have been, or in the case of
Securities of a series offered in a Periodic Offering, will be, established
by or pursuant to Board Resolution as permitted by Section 301, that such
terms have been, or in the case of Securities of a series offered in a
Periodic Offering, will be, established in conformity with the provisions
of this Indenture, subject, in the case of Securities of a series offered
in a Periodic Offering, to any conditions specified in such Opinion of
Counsel; and
(3) that such Securities, when authenticated and delivered by the
Trustee and issued by the Corporation in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Corporation enforceable in accordance
with their terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the preceding
paragraph, if all Securities of a series are not to be originally issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 301 or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the
authentication of each Security of such series if such documents are delivered
at or prior to the authentication upon original issuance of the first Security
of such series to be issued.
With respect to Securities of a series offered in a Periodic Offering,
the Trustee may rely, as to the authorization by the Corporation of any of such
Securities, the form and terms thereof and the legality, validity, binding
effect and enforceability thereof, upon the Opinion of Counsel and the other
documents delivered pursuant to Sections 201 and 301 and this Section, as
applicable, in connection with the first authentication of Securities of such
series.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature of an authorized officer, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder. Notwithstanding the foregoing, if any Security shall have been
authenticated and delivered hereunder but never issued and sold by the
Corporation, and the Corporation shall deliver such Security to the Trustee for
cancellation as provided in Section 309, for all purposes of this Indenture such
Security shall be deemed never to have been authenticated and delivered
hereunder and shall never be entitled to the benefits of this Indenture.
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Section 304. Temporary Securities.
Pending the preparation of definitive Securities of any series, the
Corporation may execute, and upon Company Order the Trustee shall authenticate
and deliver, temporary Securities which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Corporation will
cause definitive Securities of that series to be prepared without unreasonable
delay. After the preparation of definitive Securities of such series, the
temporary Securities of such series shall be exchangeable for definitive
Securities of such series upon surrender of the temporary Securities of such
series at the office or agency of the Corporation in a Place of Payment for that
series, without charge to the Holder. Upon surrender for cancellation of any
one or more temporary Securities of any series, the Corporation shall execute
and the Trustee shall authenticate and deliver in exchange therefor one or more
definitive Securities of the same series, of any authorized denominations and of
like tenor and aggregate principal amount. Until so exchanged, the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of such series and tenor.
Section 305. Registration, Registration of Transfer and Exchange.
The Corporation shall cause to be kept at the Corporate Trust Office
of the Trustee a register (the register maintained in such office or in any
other office or agency of the Corporation in a Place of Payment being herein
sometimes referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Corporation shall provide for
the registration of Securities and of transfers of Securities. The Trustee is
hereby appointed "Security Registrar" for the purpose of registering Securities
and transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security of a
series at the office or agency of the Corporation in a Place of Payment for that
series, the Corporation shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Securities of the same series, of any authorized denominations and of like
tenor and 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
like tenor and 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 Corporation shall execute, and the Trustee shall
authenticate and deliver, the Securities which the Holder making the exchange is
entitled to receive.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Corporation, evidencing the
same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
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Every Security presented or surrendered for registration of transfer
or for exchange shall (if so required by the Corporation or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Corporation and the Security Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Corporation may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities, other
than exchanges pursuant to Section 304, 906 or 1106 not involving any transfer.
If the Securities of any series (or of any series and specified tenor)
are to be redeemed, the Corporation shall not be required (A) to issue, register
the transfer of or exchange any Securities of that series (or of that series and
specified tenor, as the case may be) during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of any
such Securities selected for redemption and ending at the close of business on
the day of such mailing, or (B) to 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.
The provisions of Clauses (1), (2), (3) and (4) below shall apply only
to Global Securities:
(1) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depositary designated for such Global
Security or a nominee thereof and delivered to such Depositary or a nominee
thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.
(2) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered,
and no transfer of a Global Security in whole or in part may be registered,
in the name of any Person other than the Depositary for such Global
Security or a nominee thereof unless (A) such Depositary has notified the
Corporation that it is unwilling or unable to continue as Depositary for
such Global Security and a successor Depositary has not been appointed by
the Corporation within 90 days of receipt by the Corporation of such
notification, (B) if at any time the Depositary ceases to be a clearing
agency registered under the Exchange Act at a time when the Depositary is
required to be so registered to act as such Depositary and no successor
Depositary shall have been appointed by the Corporation within 90 days
after it became aware of such cessation, or (C) there shall exist such
circumstances, if any, in addition to or in lieu of the foregoing as have
been specified for this purpose as contemplated by Section 301.
Notwithstanding the foregoing, the Corporation may at any time in its sole
discretion determine that Securities issued in the form of a Global
Security shall no longer be represented in whole or in part by such Global
Security, and the Trustee, upon receipt of a Company Order therefor, shall
authenticate and deliver definitive Securities in exchange in whole or in
part for such Global Security.
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(3) Subject to Clause (2) above, any exchange or transfer of a Global
Security for other Securities may be made in whole or in part, and all
Securities issued in exchange for or upon transfer of a Global Security or
any portion thereof shall be registered in such names as the Depositary for
such Global Security shall direct.
(4) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any
portion thereof, whether pursuant to this Section, Section 304, 306, 906 or
1106 or otherwise, shall be authenticated and delivered in the form of, and
shall be, a Global Security, unless such Security is registered in the name
of a Person other than the Depositary for such Global Security or a nominee
thereof.
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the
Corporation shall execute and the Trustee shall authenticate and deliver in
exchange therefor a new Security of the same series and of like tenor and
principal amount and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Corporation and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Corporation or the Trustee that such Security has been acquired by a bona
fide purchaser, the Corporation shall execute and the Trustee shall authenticate
and deliver, in lieu of any such destroyed, lost or stolen Security, a new
Security of the same series and of like tenor and principal amount and bearing a
number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Corporation in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Corporation may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Corporation, whether or not the
destroyed, lost or stolen Security shall be at any time enforceable by anyone,
and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Securities of that series duly issued
hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
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Section 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301 with
respect to any series of Securities, interest on any Security which is payable,
and is punctually paid or duly provided for, on any Interest Payment Date shall
be paid to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest.
Except as otherwise provided as contemplated by Section 301 with
respect to any series of Securities, any interest on any Security of any series
which is payable, but is not punctually paid or duly provided for, on any
Interest Payment Date (herein called "Defaulted Interest") shall forthwith cease
to be payable to the Holder on the relevant Regular Record Date by virtue of
having been such Holder, and such Defaulted Interest may be paid by the
Corporation, at its election in each case, as provided in Clause (1) or (2)
below:
(1) The Corporation may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities of such series (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 Corporation
shall notify the Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each Security of such series and the date of the
proposed payment, and at the same time the Corporation shall deposit with
the Trustee an amount of money equal to the aggregate amount proposed to be
paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this
Clause provided. Thereupon the Trustee shall fix a Special Record Date for
the payment of such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Corporation of
such Special Record Date and, in the name and at the expense of the
Corporation, shall cause notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor to be given to each Holder of
Securities of such series in the manner set forth in Section 106, not less
than 10 days prior to such Special Record Date. Notice of the proposed
payment of such Defaulted Interest and the Special Record Date therefor
having been so mailed, such Defaulted Interest shall be paid to the Persons
in whose names the Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on such
Special Record Date and shall no longer be payable pursuant to the
following Clause (2).
(2) The Corporation may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with
the requirements of any securities exchange, if any, on which such
Securities may be listed, and upon such notice as may be required by such
exchange, if, after notice given by the Corporation to the Trustee of the
proposed payment pursuant to this Clause, such manner of payment shall be
deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other
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Security shall carry the rights to interest accrued and unpaid, and to accrue,
which were carried by such other Security.
Section 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer,
the Corporation, the Trustee and any agent of the Corporation or the Trustee may
treat the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal of and any premium
and (subject to Section 307) any interest on such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Corporation, the Trustee nor any agent of the Corporation or the Trustee shall
be affected by notice to the contrary.
Section 309. Cancellation.
All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly cancelled by it. The Corporation may at any time deliver
to the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Corporation may have acquired in any manner
whatsoever, and may deliver to the Trustee (or to any other Person for delivery
to the Trustee) for cancellation any Securities previously authenticated
hereunder which the Corporation has not issued and sold, and all Securities so
delivered shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as provided
in this Section, except as expressly permitted by this Indenture. All cancelled
Securities held by the Trustee shall be disposed of as directed by a Company
Order; provided, however, that the Trustee shall not be required to destroy such
cancelled Securities.
Section 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for
Securities of any series, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.
Section 311. CUSIP Numbers.
The Corporation in issuing the Securities may use "CUSIP" numbers (if
then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in
notices of redemption as a convenience to Holders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers.
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ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further
effect (except as to any surviving rights of registration of transfer or
exchange of Securities herein expressly provided for), and the Trustee, at the
expense of the Corporation, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other
than (i) Securities which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section 306 and (ii)
Securities for whose payment money has theretofore been deposited in
trust or segregated and held in trust by the Corporation and
thereafter repaid to the Corporation or discharged from such trust, as
provided in Section 1003) have been delivered to the Trustee for
cancellation; or
(B) all such Securities not theretofore delivered to the Trustee
for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity
within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice
of redemption by the Trustee in the name, and at the expense, of
the Corporation,
and the Corporation, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust funds in
trust for the purpose (I) money in an amount, (II) Government
Obligations (as defined in Section 1304) which through the scheduled
payment of principal and interest in respect thereof in accordance
with their terms will provide, not later than the due date of any
payment, money in an amount, or (III) a combination thereof,
sufficient, in the case of (II) or (III), in the opinion of a
nationally recognized firm of independent public accountants expressed
in a written certification thereof delivered to the Trustee, to pay
and discharge, and which shall be applied by the Trustee to pay and
discharge, the entire indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation, for principal and any
premium and interest to the date of such deposit (in the case of
Securities which have become due and payable) or to the Stated
Maturity or Redemption Date, as the case may be;
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(2) the Corporation has paid or caused to be paid all other sums
payable hereunder by the Corporation; and
(3) the Corporation has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of
this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Corporation to the Trustee under Section 607, the obligations
of the Corporation to any Authenticating Agent under Section 614 and, if money
shall have been deposited with the Trustee pursuant to subclause (B) of Clause
(1) of this Section, the obligations of the Trustee under Section 402 and the
last paragraph of Section 1003 shall survive.
Section 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all
money deposited with the Trustee pursuant to Section 401 shall be held in trust
and applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Corporation acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
ARTICLE FIVE
Remedies
Section 501. Events of Default.
"Event of Default," wherever used herein with respect to Securities of
any series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or Article Fourteen or pursuant to any judgment, decree or
order of any court or any order, rule or regulation of any administrative or
governmental body), unless it is inapplicable to a particular series or is
specifically deleted or modified in the Board Resolution (or action taken
pursuant thereto), Officers' Certificate or supplemental indenture under which
such series of Securities is issued or has been deleted or modified in an
indenture supplemental hereto:
(1) default in the payment of any interest upon any Security of that
series when it becomes due and payable, and continuance of such default for
a period of 60 days; provided, however, that if the Corporation is
permitted by the terms of the Securities of such series to defer the
payment in question, the date on which such payment is due and payable
shall be the date on which the Corporation is required to make payment
following such deferral, if such deferral has been elected pursuant to the
terms of the Securities; or
(2) default in the payment of the principal of or any premium on any
Security of that series at its Maturity; or
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(3) default in the making of any sinking fund payment, when and as due
by the terms of a Security of that series, and continuance of such default
for a period of 60 days; or
(4) default in the performance, or breach, of any covenant of the
Corporation in this Indenture (other than a covenant a default in whose
performance or whose breach is elsewhere in this Section specifically dealt
with or which has expressly been included in this Indenture solely for the
benefit of series of Securities other than that series), 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 Corporation by the Trustee or to
the Corporation and the Trustee by the Holders of at least 33% in principal
amount of the Outstanding Securities of that series 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, unless the
Trustee, or the Trustee and the Holders of a principal amount of Securities
of such series not less than the principal amount of Securities the Holders
of which gave such notice, as the case may be, shall agree in writing to an
extension of such period prior to its expiration; provided, however, that
the Trustee, or the Trustee and the Holders of such principal amount of
Securities of such series, as the case may be, shall be deemed to have
agreed to an extension of such period if corrective action is initiated by
the Corporation within such period and is being diligently pursued; or
(5) the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Corporation in an involuntary
case or proceeding under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law or (B) a decree or order
adjudging the Corporation a bankrupt or insolvent, or approving as properly
filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Corporation under any applicable
Federal or State law, or appointing a custodian, receiver, liquidator,
assignee, trustee, sequestrator or other similar official of the
Corporation or of any substantial part of its property, or ordering the
winding up or liquidation of its affairs, and the continuance of any such
decree or order for relief or any such other decree or order unstayed and
in effect for a period of 90 consecutive days; or
(6) the commencement by the Corporation of a voluntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to
be adjudicated a bankrupt or insolvent, or the consent by it to the entry
of a decree or order for relief in respect of the Corporation in an
involuntary case or proceeding under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy or insolvency case or proceeding against it,
or the filing by it of a petition or answer or consent seeking
reorganization or relief under any applicable Federal or State law, or the
consent by it to the filing of such petition or to the appointment of or
taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Corporation or of any
substantial part of its property, or the making by it of an assignment for
the benefit of creditors, or the admission by it in writing of its
inability to pay its debts generally as they become due, or the
authorization of any such action by the Board of Directors; or
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(7) any other Event of Default provided with respect to Securities of
that series.
Section 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default with respect to Securities of any series at the
time Outstanding occurs and is continuing, then in every such case the Trustee
or the Holders of not less than 33% in principal amount of the Outstanding
Securities of that series may declare the principal amount of all the Securities
of that series (or, if any Securities of that series are Original Issue Discount
Securities, such portion of the principal amount of such Securities as may be
specified by the terms thereof) to be due and payable immediately, by a notice
in writing to the Corporation (and to the Trustee if given by Holders), and upon
any such declaration such principal amount (or specified amount) shall become
immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Event of Default giving rise to such declaration of
acceleration shall, without further act, be deemed to have been waived, and such
declaration and its consequences shall, without further act, be deemed to have
been rescinded and annulled, if
(1) the Corporation has paid or deposited with the Trustee a sum
sufficient to pay
(A) all overdue interest on all Securities of that series,
(B) the principal of (and premium, if any, on) any Securities of
that series which have become due otherwise than by such declaration
of acceleration and any interest thereon at the rate or rates
prescribed therefor in such Securities,
(C) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate or rates prescribed
therefor in such Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel;
and
(2) all Events of Default with respect to Securities of that series,
other than the non-payment of the principal of Securities of that series
which have become due solely by such declaration of acceleration, have been
cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
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Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Corporation covenants that if
(1) default is made in the payment of any interest on any Security
when such interest becomes due and payable and such default continues for a
period of 60 days, or
(2) default is made in the payment of the principal of (or premium, if
any, on) any Security at the Maturity thereof,
the Corporation will, upon demand of the Trustee, pay to it, for the benefit of
the Holders of such Securities, the whole amount then due and payable on such
Securities for principal and any premium and interest and, to the extent that
payment of such interest shall be legally enforceable, interest on any overdue
principal and premium and on any overdue interest, at the rate or rates
prescribed therefor in such Securities, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series occurs
and is continuing, the Trustee may in its discretion proceed to protect and
enforce its rights and the rights of the Holders of Securities of such series by
such appropriate judicial proceedings as the Trustee shall deem most effectual
to protect and enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exercise of any
power granted herein, or to enforce any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Corporation (or any
other obligor upon the Securities), its property or its creditors, the Trustee
shall be entitled and empowered, by intervention in such proceeding or
otherwise, to take any and all actions authorized under the Trust Indenture Act
in order to have claims of the Holders and the Trustee allowed in any such
proceeding. In particular, the Trustee shall be authorized to collect and
receive any moneys or other property payable or deliverable on any such claims
and to distribute the same; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 607.
No provision of this Indenture shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding; provided,
however, that the Trustee may, on behalf of the Holders, vote for the election
of a trustee in bankruptcy or similar official and be a member of a creditors'
or other similar committee.
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Section 505. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.
Section 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall,
subject (in the case of clauses Second and Third below) to the subordination
provisions hereof, be applied in the following order, at the date or dates fixed
by the Trustee and, in case of the distribution of such money on account of
principal or any premium or interest, upon presentation of the Securities and
the notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
First: To the payment of all amounts due the Trustee under Section
607;
Second: To the payment of the amounts then due and unpaid for
principal of and any premium and interest on the Securities in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due
and payable on such Securities for principal and any premium and interest,
respectively; and
Third: To the payment of the balance, if any, to the Corporation or
any other Person or Persons legally entitled thereto.
Section 507. Limitation on Suits.
No Holder of any Security of any series shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Indenture,
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless
(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to the Securities of that
series;
(2) the Holders of not less than a majority in principal amount of the
Outstanding Securities of that series shall have made written request to
the Trustee to institute proceedings in respect of such Event of Default in
its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
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(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
Section 508. Unconditional Right of Holders to Receive Principal, Premium and
Interest.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of and any premium and (subject to Section 307)
interest on such Security on the respective Stated Maturities expressed in such
Security (or, in the case of redemption, on the Redemption Date) and to
institute suit for the enforcement of any such payment, and such rights shall
not be impaired without the consent of such Holder.
Section 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Corporation, the Trustee and the Holders
shall be restored severally and respectively to their former positions hereunder
and thereafter all rights and remedies of the Trustee and the Holders shall
continue as though no such proceeding had been instituted.
Section 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in the last paragraph
of Section 306, no right or remedy herein conferred upon or reserved to the
Trustee or to the Holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
Section 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Securities
to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein.
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Every right and remedy given by this Article or by law to the Trustee or to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may be.
Section 512. Control By Holders.
The Holders of a majority in principal amount of the Outstanding
Securities of any series 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, with respect to the
Securities of such series; provided that
(1) such direction shall not be in conflict with any rule of law or
with this Indenture,
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction, and
(3) subject to the provisions of Section 601, the Trustee shall have
the right to decline to follow any such direction if the Trustee in good
faith shall, by a Responsible Officer or Officers of the Trustee, determine
that the proceeding so directed would involve the Trustee in personal
liability.
Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of all series with respect to which any default under the
Indenture shall have occurred and be continuing (voting as one class) may, on
behalf of the Holders of all Securities of all such series, waive such past
default under the Indenture and its consequences, except a default
(1) in the payment of the principal of or any premium or interest on
any Security of such series, or
(2) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of
each Outstanding Security of the series affected.
Upon any such waiver, such default shall cease to exist and be deemed
not to have occurred, and any Event of Default arising therefrom shall be deemed
to have been cured and not to have occurred, for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other default or
impair any right consequent thereon.
Section 514. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, a court may require any party litigant in such suit to
file an undertaking to pay the costs of such suit, and may assess costs against
any such party litigant, in the manner and to the extent provided in the Trust
Indenture Act; provided that neither this Section nor the Trust Indenture
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Act shall be deemed to authorize any court to require such an undertaking or to
make such an assessment in any suit instituted by the Corporation or the
Trustee.
Section 515. Waiver of Stay or Extension Laws.
The Corporation covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, or plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Corporation (to the extent that it
may lawfully do so) hereby expressly waives all benefit or advantage of any such
law and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided by
the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.
Section 602. Notice of Defaults.
If a default occurs hereunder with respect to Securities of any
series, the Trustee shall give the Holders of Securities of such series notice
of such default as and to the extent provided by the Trust Indenture Act;
provided, however, that in the case of any default of the character specified in
Section 501(4) with respect to Securities of such series, no such notice to
Holders shall be given until at least 30 days after the occurrence thereof. For
the purpose of this Section, the term "default" means any event which is, or
after notice or lapse of time or both would become, an Event of Default with
respect to Securities of such series.
Section 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(1) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of
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indebtedness or other paper or document believed by it to be genuine and to
have been signed or presented by the proper party or parties;
(2) any request or direction of the Corporation mentioned herein shall
be sufficiently evidenced by a Company Request or Company Order or as
otherwise expressly provided herein, and any resolution of the Board of
Directors shall be sufficiently evidenced by a Board Resolution;
(3) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officers' Certificate;
(4) the Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(5) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction;
(6) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled, at reasonable times previously notified to the
Corporation, to examine the relevant books, records and premises of the
Corporation, personally or by agent or attorney; and
(7) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder.
Section 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Corporation, and neither the Trustee nor any Authenticating Agent assumes
any responsibility for their correctness. The Trustee makes no representations
as to the validity or sufficiency of this Indenture or of the Securities.
Neither the Trustee nor any Authenticating Agent shall be accountable for the
use or application by the Corporation of Securities or the proceeds thereof.
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Section 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Corporation, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
608 and 613, may otherwise deal with the Corporation with the same rights it
would have if it were not Trustee, Authenticating Agent, Paying Agent, Security
Registrar or such other agent.
Section 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed in writing with the Corporation.
Section 607. Compensation and Reimbursement.
The Corporation agrees
(1) to pay to the Trustee from time to time such compensation as shall
be agreed to in writing between the Corporation and the Trustee for all
services rendered by it hereunder (which compensation shall not be limited
by any provision of law in regard to the compensation of a trustee of an
express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision
of this Indenture (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence, willful
misconduct or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless against, any
loss, liability or expense incurred without negligence, willful misconduct
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 of defending itself against any claim or liability
in connection with the exercise or performance of any of its powers or
duties hereunder.
The Trustee shall have a lien prior to the Securities upon all
property and funds held by it hereunder for any amount owing it or any
predecessor Trustee pursuant to this Section 607, except with respect to funds
held in trust for the benefit of the Holders of particular Securities.
Without limiting any 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 501(5) or Section 501(6), 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.
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The provisions of this Section shall survive the termination of this
Indenture.
Section 608. Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture. To the extent
permitted by such Act, the Trustee shall not be deemed to have a conflicting
interest by virtue of being a trustee under this Indenture with respect to
Securities of more than one series.
Section 609. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder with respect to the
Securities of each series, which may be Trustee hereunder for Securities of one
or more other series. Each Trustee shall be a Person that is eligible pursuant
to the Trust Indenture Act to act as such and has a combined capital and surplus
of at least $50,000,000. If any such Person publishes reports of condition at
least annually, pursuant to law or to the requirements of its supervising or
examining authority, then for the purposes of this Section and to the extent
permitted by the Trust Indenture Act, the combined capital and surplus of such
Person shall be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published. If at any time the Trustee
with respect to the Securities of any series shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article.
Section 610. Resignation and Removal; Appointment of Successor.
No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 611.
The Trustee may resign at any time with respect to the Securities of
one or more series by giving written notice thereof to the Corporation. If the
instrument of acceptance by a successor Trustee required by Section 611 shall
not have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.
The Trustee may be removed at any time with respect to the Securities
of any series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and to the
Corporation.
If at any time:
(1) the Trustee shall fail to comply with Section 608 after written
request therefor by the Corporation or by any Holder who has been a bona
fide Holder of a Security for at least six months, or
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(2) the Trustee shall cease to be eligible under Section 609 and shall
fail to resign after written request therefor by the Corporation or by any
such Holder, or
(3) the Trustee shall become incapable of acting or shall be adjudged
a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (A) the Corporation by a Board Resolution may remove the
Trustee with respect to all Securities, or (B) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, with respect
to the Securities of one or more series, the Corporation, by a Board Resolution,
shall promptly appoint a successor Trustee or Trustees with respect to the
Securities of that or those series (it being understood that any such successor
Trustee may be appointed with respect to the Securities of one or more or all of
such series and that at any time there shall be only one Trustee with respect to
the Securities of any particular series) and shall comply with the applicable
requirements of Section 611. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
with respect to the Securities of any series shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities of such
series delivered to the Corporation and the retiring Trustee, the successor
Trustee so appointed shall, forthwith upon its acceptance of such appointment in
accordance with the applicable requirements of Section 611, become the successor
Trustee with respect to the Securities of such series and to that extent
supersede the successor Trustee appointed by the Corporation. If no successor
Trustee with respect to the Securities of any series shall have been so
appointed by the Corporation or the Holders and accepted appointment in the
manner required by Section 611, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.
The Corporation shall give notice of each resignation and each removal
of the Trustee with respect to the Securities of any series and each appointment
of a successor Trustee with respect to the Securities of any series to all
Holders of Securities of such series in the manner provided in Section 106.
Each notice shall include the name of the successor Trustee with respect to the
Securities of such series and the address of its Corporate Trust Office.
Section 611. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Corporation and to the retiring Trustee
an instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Trustee shall become effective and such successor
Trustee, without any further act, deed or conveyance, shall become vested with
all
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the rights, powers, trusts and duties of the retiring Trustee; but, on the
request of the Corporation or the successor Trustee, such retiring Trustee
shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor Trustee all the rights, powers and trusts of the
retiring Trustee and shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder.
In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Corporation,
the retiring Trustee and each successor Trustee with respect to the Securities
of one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Trustee all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates, (2)
if the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same trust and that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Trustee; and upon the execution and delivery of such supplemental
indenture the resignation or removal of the retiring Trustee shall become
effective to the extent provided therein and each such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates; but, on request of the Corporation or any successor Trustee,
such retiring Trustee shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder with
respect to the Securities of that or those series to which the appointment of
such successor Trustee relates.
Upon request of any such successor Trustee, the Corporation shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred
to in the first or second preceding paragraph, as the case may be.
No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be qualified and eligible under
this Article.
Section 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any
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of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
Section 613. Preferential Collection of Claims Against Corporation.
If and when the Trustee shall be or become a creditor of the
Corporation (or any other obligor upon the Securities), the Trustee shall be
subject to the provisions of the Trust Indenture Act regarding the collection of
claims against the Corporation (or any such other obligor).
Section 614. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents acceptable
to the Corporation with respect to one or more series of Securities which shall
be authorized to act on behalf of the Trustee to authenticate Securities of such
series issued upon exchange, registration of transfer or partial redemption
thereof or pursuant to Section 306, and Securities so authenticated shall be
entitled to the benefits of this Indenture and shall be valid and obligatory for
all purposes as if authenticated by the Trustee hereunder. Wherever reference
is made in this Indenture to the authentication and delivery of Securities by
the Trustee or the Trustee's certificate of authentication, such reference shall
be deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Corporation and shall at all times be a corporation organized
and doing business under the laws of the United States of America, any State
thereof or the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not less than
$50,000,000 and subject to supervision or examination by Federal or State
authority. If such Authenticating Agent publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such Authenticating Agent shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, such Authenticating Agent shall
resign immediately in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Corporation. The Trustee may at any
time terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating
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Agent and to the Corporation. Upon receiving such a notice of resignation or
upon such a termination, or in case at any time such Authenticating Agent shall
cease to be eligible in accordance with the provisions of this Section, the
Trustee may appoint a successor Authenticating Agent which shall be acceptable
to the Corporation and shall give notice of such appointment in the manner
provided in Section 106 to all Holders of Securities of the series with respect
to which such Authenticating Agent will serve. Any successor Authenticating
Agent upon acceptance of its appointment hereunder shall become vested with all
the rights, powers and duties of its predecessor hereunder, with like effect as
if originally named as an Authenticating Agent. No successor Authenticating
Agent shall be appointed unless eligible under the provisions of this Section.
The Corporation agrees to pay to each Authenticating Agent from time
to time reasonable compensation for its services under this Section.
If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternative
certificate of authentication in the following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
THE CHASE MANHATTAN BANK,
As Trustee
By:_____________________________
As Authenticating Agent
By:_____________________________
Authorized Officer
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ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Corporation
Section 701. Corporation to Furnish Trustee Names and Addresses of Holders.
The Corporation will furnish or cause to be furnished to the Trustee
(1) 15 days after each Regular Record Date, a list, in such form as
the Trustee may reasonably require, of the names and addresses of the
Holders of Securities of each series as of such Regular Record Date, and
(2) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Corporation of any such request, a list of
similar form and content as of a date not more than 15 days prior to the
time such list is furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
Section 702. Preservation of Information; Communications to Holders.
The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 701 upon receipt of a new list so furnished.
The rights of Holders to communicate with other Holders with respect
to their rights under this Indenture or under the Securities, and the
corresponding rights and privileges of the Trustee, shall be as provided by the
Trust Indenture Act.
Every Holder of Securities, by receiving and holding the same, agrees
with the Corporation and the Trustee that neither the Corporation nor the
Trustee nor any agent of either of them shall be held accountable by reason of
any disclosure of information as to names and addresses of Holders made pursuant
to the Trust Indenture Act.
Section 703. Reports by Trustee.
The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.
If required by Section 313(a) of the Trust Indenture Act, the Trustee shall,
within 60 days after each October 1 following the date of this Indenture,
deliver to Holders a brief report, dated as of such October 1, which complies
with the provisions of such Section 313(a).
A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed, with the Commission and with the Corporation. The
Corporation will promptly notify the Trustee when any Securities are listed on
any stock exchange.
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Section 704. Reports by Corporation.
The Corporation shall file with the Trustee and the Commission, and
transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant to such Act; provided that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Exchange Act shall be filed with the
Trustee within 15 days after the same is so required to be filed with the
Commission.
ARTICLE EIGHT
Consolidation, Merger, Conveyance or Transfer
Section 801. Corporation 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 Corporation with or into any other
Person or Persons (whether or not affiliated with the Corporation), or
successive consolidations or mergers in which the Corporation or its successor
or successors shall be a party or parties, or shall prevent any conveyance or
transfer of the properties and assets of the Corporation as an entirety or
substantially as an entirety to any other Person (whether or not affiliated with
the Corporation) lawfully entitled to acquire the same; provided, however, and
the Corporation hereby covenants and agrees, that upon any such consolidation,
merger, conveyance or transfer, (i) the due and punctual payment of the
principal of and premium, if any, and interest on all of the Securities,
according to their tenor, and the due and punctual performance and observance of
all of the covenants and conditions of this Indenture to be performed by the
Corporation, shall be expressly assumed, by indenture supplemental hereto, in
form reasonably satisfactory to the Trustee, executed and delivered to the
Trustee by the Person (if other than the Corporation) formed by such
consolidation, or into which the Corporation shall have been merged, or by the
Person which shall have acquired such properties and assets, and (ii) the
Corporation shall deliver to the Trustee an Officers' Certificate and an Opinion
of Counsel, each stating that such consolidation, merger, conveyance or transfer
and, if a supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with this Article and that all
conditions precedent herein provided for relating to such transaction have been
complied with.
Section 802. Successor Substituted.
Upon any consolidation of the Corporation with, or merger of the
Corporation into, any other Person or any conveyance or transfer of the
properties and assets of the Corporation as an entirety or substantially as an
entirety in accordance with Section 801, the successor Person formed by such
consolidation or into which the Corporation is merged or to which such
conveyance or transfer is made shall succeed to, and be substituted for, and may
exercise every right and power of, the Corporation under this Indenture with the
same effect as if such successor Person had been named as the Corporation
herein, and thereafter the predecessor Person shall be relieved of all
obligations and covenants under this Indenture and the Securities.
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ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Corporation, when authorized
by a Board Resolution, and the Trustee, at any time and from time to time, may
enter into one or more indentures supplemental hereto, in form reasonably
satisfactory to the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Corporation
and the assumption by any such successor of the covenants of the
Corporation herein and in the Securities; or
(2) to add to the covenants of the Corporation for the benefit of the
Holders of all or any series of Securities (and if such covenants are to be
for the benefit of less than all series of Securities, stating that such
covenants are expressly being included solely for the benefit of such
series) or to surrender any right or power herein conferred upon the
Corporation; or
(3) to add any additional Events of Default for the benefit of the
Holders of all or any series of Securities (and if such additional Events
of Default are to be for the benefit of less than all series of Securities,
stating that such additional Events of Default are expressly being included
solely for the benefit of such series); or
(4) to add to or change any of the provisions of this Indenture to
such extent as shall be necessary to permit or facilitate the issuance of
Securities in bearer form, registrable or not registrable as to principal,
and with or without interest coupons, or to facilitate the issuance of
Securities in uncertificated form; or
(5) to add to, change or eliminate any of the provisions of this
Indenture in respect of one or more series of Securities; provided that any
such addition, change or elimination (A) shall neither (i) apply to any
Security of any series created prior to the execution of such supplemental
indenture and entitled to the benefit of such provision nor (ii) modify the
rights of the Holder of any such Security with respect to such provision or
(B) shall become effective only when there is no such Security Outstanding;
or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any series as
permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this Indenture
as shall be necessary to provide for
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or facilitate the administration of the trusts hereunder by more than one
Trustee, pursuant to the requirements of Section 611; or
(9) subject to Section 907, to make any change in Article Fourteen
that would limit or terminate the benefits available to any holder of
Senior Indebtedness under such Article; or
(10) to cure any ambiguity, to correct or supplement any provision
herein which may be defective or inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture; provided that such action pursuant
to this Clause (10) shall not adversely affect the interests of the Holders
of Securities of any series in any material respect.
Section 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of all series affected by such
supplemental indenture (voting as one class), by Act of said Holders delivered
to the Corporation and the Trustee, the Corporation, when authorized by a Board
Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of any
supplemental indenture, or modifying in any manner the rights of the Holders of
Securities under this Indenture; provided, however, that no such supplemental
indenture shall, without the consent of the Holder of each Outstanding Security
affected thereby,
(1) change the Stated Maturity of the principal of, or any installment
of principal of or interest on, any Security, or reduce the principal
amount thereof or the rate of interest thereon or any premium payable upon
the redemption thereof, or reduce the amount of the principal of an
Original Issue Discount Security or any other Security which would be due
and payable upon a declaration of acceleration of the Maturity thereof
pursuant to Section 502 or change the coin or currency in which any
Security or any premium or interest thereon is payable, or impair the right
to institute suit for the enforcement of any such payment on or after the
Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date), or
(2) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of whose Holders is required for any
such supplemental indenture, or the consent of whose Holders is required
for any waiver (of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences) provided for in this
Indenture, or
(3) modify any of the provisions of this Section, Section 513 or
Section 1005, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Security affected
thereby; provided, however, that this clause shall not be deemed to require
the consent of any Holder with respect to changes in the references to "the
Trustee" and concomitant changes in this Section and Section 1005, or the
deletion of this proviso, in accordance with the requirements of Sections
611 and 901(8). A supplemental indenture which changes or eliminates any
covenant or other provision of this Indenture which has expressly been
included solely for the benefit of one or more particular series of
Securities, or which modifies the rights of the Holders of Securities of
such series with respect to such covenant or other provision, shall be
deemed not to affect the rights under this Indenture of the Holders of
Securities of any other series.
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It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
Section 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
Section 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
Section 906. Reference in Securities to Supplemental Indentures.
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Corporation
shall so determine, new Securities of any series so modified as to conform, in
the opinion of the Trustee and the Corporation, to any such supplemental
indenture may be prepared and executed by the Corporation and authenticated and
delivered by the Trustee in exchange for Outstanding Securities of such series.
Section 907. Subordination Unimpaired.
This Indenture may not be amended to alter the subordination of any of
the Outstanding Securities without the written consent of each holder of Senior
Indebtedness then outstanding that would be adversely affected thereby.
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ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest.
The Corporation covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of and any premium
and interest on the Securities of that series in accordance with the terms of
the Securities and this Indenture.
Section 1002. Maintenance of Office or Agency.
The Corporation will maintain in each Place of Payment for any series
of Securities an office or agency where Securities of that series may be
presented or surrendered for payment, where Securities of that series may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Corporation in respect of the Securities of that series
and this Indenture may be served. The Corporation will give prompt written
notice to the Trustee of the location, and any change in the location, of such
office or agency. If at any time the Corporation shall fail to maintain any
such required office or agency or shall fail to furnish the Trustee with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the Corporate Trust Office of the Trustee, and the Corporation
hereby appoints the Trustee as its agent to receive all such presentations,
surrenders, notices and demands.
The Corporation may also from time to time designate one or more other
offices or agencies where the Securities of one or more series may be presented
or surrendered for any or all such purposes and may from time to time rescind
such designations; provided, however, that no such designation or rescission
shall in any manner relieve the Corporation of its obligation to maintain an
office or agency in each Place of Payment for Securities of any series for such
purposes. The Corporation will give prompt written notice to the Trustee of any
such designation or rescission and of any change in the location of any such
other office or agency.
Section 1003. Money for Securities Payments to Be Held in Trust.
If the Corporation shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of the
principal of or any premium or interest on any of the Securities of that series,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay the principal and any premium and interest so becoming due
until such sums shall be paid to such Persons or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or failure so to
act.
Whenever the Corporation shall have one or more Paying Agents for any
series of Securities, it will, on or prior to each due date of the principal of
or any premium or interest on any Securities of that series, deposit with a
Paying Agent a sum sufficient to pay such amount, such sum to be held as
provided by the Trust Indenture Act, and (unless such
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Paying Agent is the Trustee) the Corporation will promptly notify the Trustee of
its action or failure so to act.
The Corporation will cause each Paying Agent for any series of
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will (1) comply with the
provisions of the Trust Indenture Act applicable to it as a Paying Agent and (2)
during the continuance of any default by the Corporation (or any other obligor
upon the Securities of that series) in the making of any payment in respect of
the Securities of that series, upon the written request of the Trustee,
forthwith pay to the Trustee all sums held in trust by such Paying Agent for
payment in respect of the Securities of that series.
The Corporation may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust hereunder by the Corporation or such Paying Agent, such sums to be held by
the Trustee upon the same trusts as those upon which such sums were held by the
Corporation or such Paying Agent; and, upon such payment by any Paying Agent to
the Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Corporation, in trust for the payment of the principal of or any premium
or interest on any Security of any series and remaining unclaimed for two years
after such principal, premium or interest has become due and payable shall be
paid to the Corporation on Company Request, or (if then held by the
Corporation) shall be discharged from such trust; and the Holder of such
Security shall thereafter, as an unsecured general creditor, look only to the
Corporation for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Corporation as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, may at the
expense of the Corporation cause to be published once, in a newspaper published
in the English language, customarily published on each Business Day and of
general circulation in the Borough of Manhattan, The City of New York, New York,
notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such publication,
any unclaimed balance of such money then remaining will be repaid to the
Corporation.
Section 1004. Statement by Officers as to Default.
The Corporation will deliver to the Trustee, on or before October 15
of each calendar year or on or before such other day in each calendar year as
the Corporation and the Trustee may from time to time agree upon, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Corporation is in default in the performance and observance of any of the
terms, provisions and conditions of this Indenture (without regard to any period
of grace or requirement of notice provided hereunder) and, if the Corporation
shall be in default, specifying all such defaults and the nature and status
thereof of which they may have knowledge.
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Section 1005. Waiver of Certain Covenants.
Except as otherwise specified as contemplated by Section 301 for
Securities of such series, the Corporation may, with respect to the Securities
of any series, omit in any particular instance to comply with any term,
provision or condition set forth in any covenant provided pursuant to Section
301(19), 901(2) or 901(7) for the benefit of the Holders of such series if
before the time for such compliance the Holders of not less than a majority in
principal amount of the Outstanding Securities of such series shall, by Act of
such Holders, either waive such compliance in such instance or generally waive
compliance with such term, provision or condition, but no such waiver shall
extend to or affect such term, provision or condition except to the extent so
expressly waived, and, until such waiver shall become effective, the obligations
of the Corporation and the duties of the Trustee in respect of any such term,
provision or condition shall remain in full force and effect.
Section 1006. Calculation of Original Issue Discount.
The Corporation shall file with the Trustee promptly after the end of
each calendar year a written notice specifying the amount of original issue
discount (including daily rates and accrual periods) accrued on Outstanding
Securities as of the end of such year.
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ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article.
Securities of any series which are redeemable before their Stated
Maturity shall be redeemable in accordance with their terms and (except as
otherwise specified as contemplated by Section 301 for such Securities) in
accordance with this Article.
Section 1102. Election to Redeem; Notice to Trustee.
The election of the Corporation to redeem any Securities shall be
evidenced by a Board Resolution or in another manner specified as contemplated
by Section 301 for such Securities. In case of any redemption at the election
of the Corporation, the Corporation shall, at least 45 days prior to the
Redemption Date fixed by the Corporation (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date, of the
principal amount of Securities of such series to be redeemed and, if applicable,
of the tenor of the Securities to be redeemed. In the case of any redemption of
Securities (a) prior to the expiration of any restriction on such redemption
provided in the terms of such Securities or elsewhere in this Indenture, or (b)
pursuant to an election of the Corporation which is subject to a condition
specified in the terms of such Securities or elsewhere in this Indenture, the
Corporation shall furnish the Trustee with an Officers' Certificate evidencing
compliance with such restriction or condition.
Section 1103. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities of any series are to be redeemed
(unless all the Securities of such series and of a specified tenor are to be
redeemed or unless such redemption affects only a single Security), the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee, from the Outstanding Securities of
such series not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of a portion of the principal amount of any Security of such series;
provided that the unredeemed portion of the principal amount of any Security
shall be in an authorized denomination (which shall not be less than the minimum
authorized denomination) for such Security. If less than all the Securities of
such series and of a specified tenor are to be redeemed (unless such redemption
affects only a single Security), the particular Securities to be redeemed shall
be selected not more than 60 days prior to the Redemption Date by the Trustee,
from the Outstanding Securities of such series and specified tenor not
previously called for redemption in accordance with the preceding sentence.
The Trustee shall promptly notify the Corporation in writing of the
Securities selected for redemption as aforesaid and, in the case of any
Securities selected for partial redemption as aforesaid, the principal amount
thereof to be redeemed.
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The provisions of the two preceding paragraphs shall not apply with
respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
Section 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Securities to be redeemed, at his address appearing in
the Security Register.
All notices of redemption shall state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) if less than all the Outstanding Securities of any series and of a
specified tenor consisting of more than a single Security are to be
redeemed, the identification (and, in the case of partial redemption of any
such Securities, the principal amounts) of the particular Securities to be
redeemed and, if less than all the Outstanding Securities of any series and
of a specified tenor consisting of a single Security are to be redeemed,
the principal amount of the particular Security to be redeemed;
(4) that on the Redemption Date the Redemption Price, together with
accrued interest, if any, to the Redemption Date, will become due and
payable upon each such Security to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date;
(5) the place or places where each such Security is to be surrendered
for payment of the Redemption Price and accrued interest, if any, unless it
shall have been specified as contemplated by Section 301 with respect to
such Securities that such surrender shall not be required;
(6) that the redemption is for a sinking fund, if such is the case;
and
(7) such other matters as the Corporation shall deem desirable or
appropriate.
Unless otherwise specified with respect to any Securities in
accordance with Section 301, with respect to any redemption of Securities at the
election of the Corporation, unless, upon the giving of notice of such
redemption, Defeasance shall have been effected with
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respect to such Securities pursuant to Section 1302, such notice may state that
such redemption shall be conditional upon the receipt by the Trustee or the
Paying Agent(s) for such Securities, on or prior to the date fixed for such
redemption, of money sufficient to pay the principal of and any premium and
interest on such Securities and that if such money shall not have been so
received such notice shall be of no force or effect and the Corporation shall
not be required to redeem such Securities. In the event that such notice of
redemption contains such a condition and such money is not so received, the
redemption shall not be made and within a reasonable time thereafter notice
shall be given, in the manner in which the notice of redemption was given, that
such money was not so received and such redemption was not required to be made,
and the Trustee or Paying Agent(s) for the Securities otherwise to have been
redeemed shall promptly return to the Holders thereof any of such Securities
which had been surrendered for payment upon such redemption.
Notice of redemption of Securities to be redeemed at the election of
the Corporation, and any notice of non-satisfaction of redemption as aforesaid,
shall be given by the Corporation or, at the Corporation's request, by the
Trustee in the name and at the expense of the Corporation. Subject to the
preceding paragraph, any such notice of redemption shall be irrevocable.
Section 1105. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, and the
conditions, if any, set forth in such notice having been satisfied, the
Securities or portions thereof so to be redeemed shall, on the Redemption Date,
become due and payable at the Redemption Price therein specified, and from and
after such date (unless, in the case of an unconditional notice of redemption,
the Corporation shall default in the payment of the Redemption Price and accrued
interest, if any) such Securities or portions thereof, if interest-bearing,
shall cease to bear interest. Upon surrender of any such Security for
redemption in accordance with said notice, such Security or portion thereof
shall be paid by the Corporation at the Redemption Price, together with accrued
interest, if any, to the Redemption Date; provided, however, that no such
surrender shall be a condition to such payment if so specified as contemplated
by Section 301 with respect to such Security, and provided further that, unless
otherwise specified as contemplated by Section 301, installments of interest
whose Stated Maturity is on or prior to the Redemption Date will be payable to
the Holders of such Securities, or one or more Predecessor Securities,
registered as such at the close of business on the relevant Record Dates
according to their terms and the provisions of Section 307.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and any premium shall, until
paid, bear interest from the Redemption Date at the rate prescribed therefor in
the Security.
Section 1106. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered
at a Place of Payment therefor (with, if the Corporation or the Trustee so
requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Corporation and the Trustee duly executed by, the Holder
thereof or his attorney duly authorized in writing), and the Corporation shall
execute, and the Trustee shall authenticate and deliver to the Holder of such
Security without service charge, a new Security or Securities of the same series
and of
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like tenor, of any authorized denomination as requested by such Holder, in
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered.
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund
for the retirement of Securities of any series except as otherwise specified as
contemplated by Section 301 for such Securities.
The minimum amount of any sinking fund payment provided for by the
terms of any Securities is herein referred to as a "mandatory sinking fund
payment", and any payment in excess of such minimum amount provided for by the
terms of such Securities is herein referred to as an "optional sinking fund
payment". If provided for by the terms of any Securities, the cash amount of
any sinking fund payment may be subject to reduction as provided in Section
1202. Each sinking fund payment shall be applied to the redemption of
Securities as provided for by the terms of such Securities.
Section 1202. Satisfaction of Sinking Fund Payments with Securities.
The Corporation (1) may deliver Outstanding Securities of a series
(other than any previously called for redemption) and (2) may apply as a credit
Securities of a series which have been redeemed either at the election of the
Corporation pursuant to the terms of such Securities or through the application
of permitted optional sinking fund payments pursuant to the terms of such
Securities, in each case in satisfaction of all or any part of any sinking fund
payment with respect to any Securities of such series required to be made
pursuant to the terms of such Securities as and to the extent provided for by
the terms of such Securities; provided that the Securities to be so credited
have not been previously so credited. The Securities to be so credited shall be
received and credited for such purpose by the Trustee at the Redemption Price,
as specified in the Securities so to be redeemed, for redemption through
operation of the sinking fund and the amount of such sinking fund payment shall
be reduced accordingly.
Section 1203. Redemption of Securities for Sinking Fund.
Not less than 45 days prior to each sinking fund payment date for any
Securities, the Corporation will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for such
Securities pursuant to the terms of such Securities, the portion thereof, if
any, which is to be satisfied by payment of cash and the portion thereof, if
any, which is to be satisfied by delivering and crediting Securities pursuant to
Section 1202 and stating the basis for such credit and that such Securities have
not been previously so credited and will also deliver to the Trustee any
Securities to be so delivered. Not less than 30 days prior to each such sinking
fund payment date, the Trustee shall select
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the Securities to be redeemed upon such sinking fund payment date in the manner
specified in Section 1103 and cause notice of the redemption thereof to be given
in the name of and at the expense of the Corporation in the manner provided in
Section 1104. Such notice having been duly given, the redemption of such
Securities shall be made upon the terms and in the manner stated in Sections
1105 and 1106.
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Applicability of Article.
Unless, pursuant to Section 301, provision is made that either or both
of (a) defeasance of any Securities or any series of Securities under Section
1302 and (b) covenant defeasance of any Securities or any series of Securities
under Section 1303 shall not apply to such Securities of a series, then the
provisions of either or both of Sections 1302 and Section 1303, as the case may
be, together with Sections 1304 and 1305, shall be applicable to the Outstanding
Securities of such series upon compliance with the conditions set forth below in
this Article.
Section 1302. Defeasance and Discharge.
The Corporation may cause itself to be discharged from its obligations
with respect to any Securities or any series of Securities on and after the date
the conditions set forth in Section 1304 are satisfied (hereinafter called
"Defeasance"). For this purpose, such Defeasance means that the Corporation
shall be deemed to have paid and discharged the entire indebtedness represented
by such Securities and to have satisfied all its other obligations under such
Securities and this Indenture insofar as such Securities are concerned (and the
Trustee, at the expense of the Corporation, shall execute proper instruments
acknowledging the same), subject to the following which shall survive until
otherwise terminated or discharged hereunder: (1) the rights of Holders of such
Securities to receive, solely from the trust fund described in Section 1304 and
as more fully set forth in such Section, payments in respect of the principal of
and any premium and interest on such Securities when payments are due, (2) the
Corporation's obligations with respect to such Securities under Sections 304,
305, 306, 1002 and 1003 and with respect to the Trustee under Section 607, (3)
the rights, powers, trusts, duties and immunities of the Trustee hereunder and
(4) this Article. Subject to compliance with this Article, Defeasance with
respect to any Securities or any series of Securities by the Corporation is
permitted under this Section 1302 notwithstanding the prior exercise by the
Corporation of its rights under Section 1303 with respect to such Securities.
Following a Defeasance, payment of such Securities may not be accelerated
because of an Event of Default.
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Section 1303. Covenant Defeasance.
The Corporation may cause itself to be released from its obligations
under any covenants provided pursuant to Section 301(19), 901(2), 901(6) or
901(7) with respect to any Securities or any series of Securities for the
benefit of the Holders of such Securities and the occurrence of any event
specified in Sections 501(4) (with respect to any such covenants provided
pursuant to Section 301(19), 901(2), 901(6) or 901(7)) or 501(7) shall be deemed
not to be or result in an Event of Default with respect to such Securities as
provided in this Section, in each case on and after the date the conditions set
forth in Section 1304 are satisfied (hereinafter called "Covenant Defeasance").
For this purpose, such Covenant Defeasance means that, with respect to such
Securities, the Corporation may omit to comply with and shall have no liability
in respect of any term, condition or limitation set forth in any such specified
Section (to the extent so specified in the case of Section 501(4)), whether
directly or indirectly by reason of any reference elsewhere herein to any such
Section or by reason of any reference in any such Section to any other provision
herein or in any other document, but the remainder of this Indenture and such
Securities shall be unaffected thereby.
Section 1304. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of Section
1302 or Section 1303 to any Securities or any series of Securities, as the case
may be:
(1) The Corporation shall irrevocably have deposited or caused to be
deposited with the Trustee as trust funds in trust for the purpose of
making the following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such Securities, (A)
money in an amount, or (B) Government Obligations which through the
scheduled payment of principal and interest in respect thereof in
accordance with their terms will provide, not later than the due date of
any payment, money in an amount, or (C) a combination thereof,
sufficient, in the case of (B) or (C), in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and discharge, and
which shall be applied by the Trustee to pay and discharge, the principal
of and any premium and interest on such Securities on the respective Stated
Maturities or on any Redemption Date established pursuant to Clause (3)
below, in accordance with the terms of this Indenture and such Securities.
As used herein, "Government Obligation" means (x) any security which is (i)
a direct obligation of the United States of America or the government which
issued the foreign currency in which such Securities are payable, for the
payment of which its full faith and credit is pledged or (ii) an obligation
of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America or such government which
issued the foreign currency in which such Securities are payable, the
payment of which is unconditionally guaranteed as a full faith and credit
obligation by the United States of America or such other government, which,
in either case (i) or (ii), is not callable or redeemable at the option of
the issuer thereof, and (y) any depositary receipt issued by a bank (as
defined in Section 3(a)(2) of the Securities Act) as custodian with respect
to any Government Obligation which is specified in clause (x) above and
held by such bank for the account of the holder of such depositary receipt,
or with respect to any specific payment of principal of or interest on any
Government Obligation which is so specified and held, provided that (except
as required by law) such
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custodian is not authorized to make any deduction from the amount payable
to the holder of such depositary receipt from any amount received by the
custodian in respect of the Government Obligation or the specific payment
of principal or interest evidenced by such depositary receipt.
(2) No event which is, or after notice or lapse of time or both would
become, an Event of Default with respect to such Securities or any other
Securities shall have occurred and be continuing at the time of such
deposit or, with regard to any such event specified in Sections 501(5) and
(6), at any time on or prior to the 90th day after the date of such deposit
(it being understood that this condition shall not be deemed satisfied
until after such 90th day).
(3) If the Securities are to be redeemed prior to Stated Maturity
(other than from mandatory sinking fund payments or analogous payments),
notice of such redemption shall have been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee shall have been
made.
(4) The Corporation shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent with respect to such Defeasance or Covenant Defeasance have been
complied with.
Section 1305. Deposited Money and Government Obligations to Be Held in Trust;
Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1003, all
money and Government Obligations (including the proceeds thereof) deposited with
the Trustee pursuant to Section 1304 in respect of any Securities shall be held
in trust and applied by the Trustee, in accordance with the provisions of such
Securities and this Indenture, to the payment, either directly or through any
such Paying Agent (including the Corporation acting as its own Paying Agent) as
the Trustee may determine, to the Holders of such Securities, of all sums due
and to become due thereon in respect of principal and any premium and interest,
but money so held in trust need not be segregated from other funds except to the
extent required by law.
The Corporation shall pay and indemnify the Trustee against any tax,
fee or other charge imposed on or assessed against the Government Obligations
deposited pursuant to Section 1304 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.
Anything in this Article to the contrary notwithstanding, the Trustee
shall deliver or pay to the Corporation from time to time upon Company Request
any money or Government Obligations held by it as provided in Section 1304 with
respect to any Securities which, in the opinion of a nationally recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect the Defeasance or Covenant Defeasance, as
the case may be, with respect to such Securities.
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ARTICLE FOURTEEN
Subordination
Section 1401. Securities Subordinated to Senior Indebtedness.
Except as otherwise specified as contemplated by Section 301 for any
series of Securities, the Corporation covenants and agrees, and each Holder of a
Security, by his acceptance thereof, likewise covenants and agrees, that the
indebtedness represented by the Securities of any series and the payment of the
principal of and any premium or interest on each and all of the Securities of
each series is subordinate, to the extent and in the manner hereinafter set
forth, in right of payment to the prior payment in full of all Senior
Indebtedness. Senior Indebtedness shall continue to be Senior Indebtedness and
entitled to the benefits of these subordination provisions irrespective of any
amendment, modification or waiver of any term of the Senior Indebtedness or
extension or renewal of the Senior Indebtedness.
In the event (a) of any payment by, or distribution of assets of, the
Corporation of any kind or character, whether in cash, property or securities,
to creditors upon any dissolution, winding-up, liquidation or reorganization of
the Corporation, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, or (b) subject to the provisions of Section
1402 that (i) a default shall have occurred and be continuing with respect to
the payment of principal, interest or any other monetary amounts due and payable
on any Senior Indebtedness and such default shall have continued beyond the
period of grace, if any, specified in the instrument evidencing such Senior
Indebtedness (and the Trustee shall have received written notice thereof from
the Corporation or one or more holders of Senior Indebtedness or their
representative or representatives or the trustee or trustees under any indenture
pursuant to which any such Senior Indebtedness may have been issued), or (ii)
the maturity of any Senior Indebtedness shall have been accelerated because of a
default in respect of such Senior Indebtedness (and the Trustee shall have
received written notice thereof from the Corporation or one or more holders of
Senior Indebtedness or their representative or representatives or the trustee or
trustees under any indenture pursuant to which any such Senior Indebtedness may
have been issued), then:
(i) the holders of all Senior Indebtedness shall first be entitled to
receive, in the case of (a) above, payment of all amounts due or to become
due upon all Senior Indebtedness and, in the case of subclauses (i) and
(ii) of clause (b) above, payment of all amounts due thereon, or provision
shall be made for such payment in money or money's worth, before the
Holders of any of the Securities are entitled to receive any payment on
account of the principal of or any premium or interest on the indebtedness
evidenced by the Securities, including, without limitation, any payments
made pursuant to Article Eleven or Article Twelve;
(ii) any payment by, or distribution of assets of, the Corporation of
any kind or character, whether in cash, property or securities, to which
the Holders of any of the Securities would be entitled except for the
provisions of this Article, including any such payment or distribution
which may be payable or deliverable by reason of the payment of any other
indebtedness of the Corporation being subordinated to the payment of such
Securities, shall be paid or delivered by the Person making such
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payment or distribution, whether a trustee in bankruptcy, a receiver or
liquidating trustee or otherwise, directly to the holders of such Senior
Indebtedness or their representative or representatives or to the trustee
or trustees under any indenture under which any instruments evidencing any
of such Senior Indebtedness may have been issued, ratably according to the
aggregate amounts remaining unpaid on account of such Senior Indebtedness
held or represented by each, to the extent necessary to make payment in
full of all Senior Indebtedness remaining unpaid after giving effect to any
concurrent payment or distribution (or provision therefor) to the holders
of such Senior Indebtedness, before any payment or distribution is made to
the Holders of the indebtedness evidenced by such Securities; and
(iii) in the event that, notwithstanding the foregoing, any payment
by, or distribution of assets of, the Corporation of any kind or character,
whether in cash, property or securities, including any such payment or
distribution which may be payable or deliverable by reason of the payment
of any other indebtedness of the Corporation being subordinated to the
payment of such Securities, in respect of principal of or any premium or
interest on any of the Securities or in connection with the repurchase by
the Corporation of any of the Securities, shall be received by the Trustee
or the Holders of any of the Securities when such payment or distribution
is prohibited pursuant to this Section, such payment or distribution shall
be paid over 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 any such Senior
Indebtedness may have been issued, ratably as aforesaid, for application to
the payment of all Senior Indebtedness remaining unpaid until all such
Senior Indebtedness shall have been paid in full, after giving effect to
any concurrent payment or distribution (or provision therefor) to the
holders of such Senior Indebtedness.
Notwithstanding the foregoing, at any time after the 90th day
following the date of deposit of money or Government Obligations pursuant to
Section 1304 (provided all other conditions set out in such Section shall have
been satisfied) the funds so deposited and any interest thereon will not be
subject to any rights of holders of Senior Indebtedness including, without
limitation, those arising under this Article.
For purposes of this Article Fourteen, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Corporation as
reorganized or readjusted, or securities of the Corporation or any other Person
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided in this Article with respect to
the Securities to the payment of all Senior Indebtedness which may at the time
be outstanding; provided that (i) the indebtedness or guarantee of indebtedness,
as the case may be, that constitutes Senior Indebtedness is assumed by the
Person, if any, resulting from any such reorganization or readjustment, and (ii)
the rights of the holders of the Senior Indebtedness are not, without the
consent of each such holder adversely affected thereby, altered by such
reorganization or readjustment. The consolidation of the Corporation with, or
the merger of the Corporation into, another Person or the liquidation or
dissolution of the Corporation following the conveyance or transfer of its
property as an entirety, or substantially as an entirety, to another Person upon
the terms and conditions provided for in Article Eight hereof shall not be
deemed a dissolution, winding-up, liquidation or reorganization for the
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purposes of this Section if such other Person shall, as part of such
consolidation, merger, conveyance or transfer, comply with the conditions stated
in Article Eight hereof.
Section 1402. Disputes with Holders of Certain Senior Indebtedness.
Any failure by the Corporation to make any payment on or perform any
other obligation under Senior Indebtedness, other than any indebtedness incurred
by the Corporation or assumed or guaranteed, directly or indirectly, by the
Corporation for money borrowed (or any deferral, renewal, extension or refunding
thereof) or any indebtedness or obligation as to which the provisions of this
Section shall have been waived by the Corporation in the instrument or
instruments by which the Corporation incurred, assumed, guaranteed or otherwise
created such indebtedness or obligation, shall not be deemed a default or event
of default under Section 1401(b) if (i) the Corporation shall be disputing its
obligation to make such payment or perform such obligation and (ii) either (A)
no final judgment relating to such dispute shall have been issued against the
Corporation which is in full force and effect and is not subject to further
review, including a judgment that has become final by reason of the expiration
of the time within which a party may seek further appeal or review, and (B) in
the event of a judgment that is subject to further review or appeal has been
issued, the Corporation shall in good faith be prosecuting an appeal or other
proceeding for review and a stay of execution shall have been obtained pending
such appeal or review.
Section 1403. Subrogation.
Subject to the payment in full of all Senior Indebtedness, the Holders
of the Securities shall be subrogated (equally and ratably with the holders of
all obligations of the Corporation which by their express terms are subordinated
to Senior Indebtedness of the Corporation to the same extent as the Securities
are subordinated and which are entitled to like rights of subrogation) to the
rights of the holders of Senior Indebtedness to receive payments or
distributions of cash, property or securities of the Corporation applicable to
the Senior Indebtedness until all amounts owing on the Securities shall be paid
in full, and as between the Corporation, its creditors other than holders of
such Senior Indebtedness and the Holders, no such payment or distribution made
to the holders of Senior Indebtedness by virtue of this Article that otherwise
would have been made to the Holders shall be deemed to be a payment by the
Corporation on account of such Senior Indebtedness, it being understood that the
provisions of this Article are and are intended solely for the purpose of
defining the relative rights of the Holders, on the one hand, and the holders of
Senior Indebtedness, on the other hand.
Section 1404. Obligation of Corporation Unconditional.
Nothing contained in this Article or elsewhere in this Indenture or in
the Securities is intended to or shall impair, as among the Corporation, its
creditors other than the holders of Senior Indebtedness and the Holders, the
obligation of the Corporation, which is absolute and unconditional, to pay to
the Holders the principal of and any premium or 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 and
creditors of the Corporation other than the holders of Senior Indebtedness, nor
shall anything herein or therein prevent the Trustee or any Holder from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture, subject to the rights, if any, under this
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Article of the holders of Senior Indebtedness in respect of cash, property or
securities of the Corporation received upon the exercise of any such remedy.
Upon payment or distribution of assets of the Corporation referred to
in this Article, the Trustee and the Holders shall be entitled to rely upon any
order or decree made by any court of competent jurisdiction in which any such
dissolution, winding-up, liquidation or reorganization proceeding affecting the
affairs of the Corporation is pending or upon a certificate of the trustee in
bankruptcy, receiver, assignee for the benefit of creditors, liquidating trustee
or agent or other person making any payment or distribution, delivered to the
Trustee or to the Holders, for the purpose of ascertaining the persons entitled
to participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Corporation, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article.
The Trustee shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself to be a holder of Senior
Indebtedness (or a trustee or representative on behalf of such holder) to
establish that such notice has been given by a holder of 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 Senior
Indebtedness to participate in any payment or distribution pursuant to this
Article, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and any other facts pertinent to the rights of
such Person under this Article, and, if such evidence is not furnished, the
Trustee may defer payment to such Person pending judicial determination as to
the right of such Person to receive such payment.
Section 1405. Payments on Securities Permitted.
Nothing contained in this Article or elsewhere in this Indenture or in
the Securities shall affect the obligations of the Corporation to make, or
prevent the Corporation from making, payment of the principal of or any premium
or interest on the Securities in accordance with the provisions hereof and
thereof, except as otherwise provided in this Article.
Section 1406. Effectuation of Subordination by Trustee.
Each Holder of Securities, by his acceptance thereof, authorizes and
directs the Trustee in his, her or its behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article and appoints the Trustee his, her or its attorney-in-fact, as the case
may be, for any and all such purposes.
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Section 1407. Knowledge of Trustee.
The Corporation shall give prompt written notice to the Trustee of any
fact known to the Corporation which would prohibit the making of any payment of
moneys to or by the Trustee in respect of the Securities pursuant to the
provisions of this Article. Notwithstanding the provisions of this Article or
any other provisions 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 moneys to or by the Trustee, or the taking of any other action by the
Trustee, unless and until the Trustee shall have received written notice thereof
mailed or delivered to the Trustee at its Corporate Trust Office from the
Corporation, any Holder, any paying agent or the holder or representative of any
Senior Indebtedness; provided that if at least two Business Days prior to the
date upon which by the terms hereof any such moneys may become payable for any
purpose (including, without limitation, the payment of the principal or any
premium or interest on any Security) the Trustee shall not have received with
respect to such moneys the notice provided for in this Section, then, anything
herein contained to the contrary notwithstanding, the Trustee shall have full
power and authority to receive such moneys and to apply the same to the purpose
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 or on or
after such date.
Section 1408. Trustee May Hold Senior Indebtedness.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article with respect to any Senior Indebtedness at the
time held by it, to the same extent as any other holder of Senior Indebtedness,
and nothing in this Indenture shall deprive the Trustee of any of its rights as
such holder.
Section 1409. Rights of Holders of Senior Indebtedness Not Impaired.
No right of any present or future holder of any Senior Indebtedness to
enforce the subordination herein shall at any time or in any way be prejudiced
or impaired by any act or failure to act on the part of the Corporation or by
any noncompliance by the Corporation with the terms, provisions and covenants of
this Indenture, regardless of any knowledge thereof which any such holder may
have or be otherwise charged with.
With respect to the holders of Senior Indebtedness, (i) the duties and
obligations of the Trustee shall be determined solely by the express provisions
of this Indenture; (ii) the Trustee shall not be liable except for the
performance of such duties and obligations as are specifically set forth in this
Indenture; (iii) no implied covenants or obligations shall be read into this
Indenture against the Trustee; and (iv) the Trustee shall not be deemed to be a
fiduciary as to such holders.
Section 1410. Trust Moneys Not Subordinated.
Notwithstanding anything contained herein to the contrary, payments
from money or Government Obligations held in trust under Article Four or Article
Thirteen by the Trustee for the payment of principal of and any premium or
interest on the Securities of any series shall not be subordinated to the prior
payment of any Senior Indebtedness of the Corporation or subject to the
restrictions set forth in this Article and none of the Holders shall
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be obligated to pay over any such amount to the Corporation or any holder of
Senior Indebtedness or any other creditor of the Corporation.
Section 1411. Article Applicable to Paying Agents.
In case at any time any paying agent other than the Trustee shall have
been appointed by the Corporation and be then acting hereunder, the term
"Trustee" as used in this Article shall in such case (unless the context shall
otherwise require) be construed as extending to and including such paying agent
within its meaning as fully for all intents and purposes as if such paying agent
were named in this Article in addition to or in place of the Trustee; provided,
however, that Sections 1407 and 1408 shall not apply to the Corporation if it
acts as its own paying agent.
Section 1412. Trustee; Compensation Not Prejudiced.
Nothing in this Article shall apply to claims of, or payments to, the
Trustee pursuant to Section 607.
ARTICLE FIFTEEN
Immunity of Incorporators, Stockholders, Officers and Directors
Section 1501. Indenture and Securities Solely Corporate Obligations.
No recourse for the payment of the principal of or any premium 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 Corporation in this Indenture or in any supplemental 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 Corporation or of any successor
corporation, either directly or through the Corporation or any successor
corporation, 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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This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
In Witness Whereof, the parties hereto have caused this Indenture to
be duly executed, and their respective corporate seals to be hereunto affixed
and attested, all as of the day and year first above written.
DUKE CAPITAL CORPORATION
By: /s/ Richard J. Osborne
----------------------------
Vice President
Attest:
/s/ Robert T. Lucas III
- ----------------------------
THE CHASE MANHATTAN BANK,
as Trustee
By: /s/ P. Kelly
-----------------------------
Vice President
Attest:
/s/ William G. Keenan
- ----------------------------
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EXHIBIT 4.4-A
DUKE CAPITAL CORPORATION
TO
THE CHASE MANHATTAN BANK
TRUSTEE
----------------
SUPPLEMENTAL INDENTURE
DATED AS OF ,
----------------
$
SERIES % JUNIOR SUBORDINATED NOTES DUE
----------------
<PAGE>
TABLE OF CONTENTS (1)
ARTICLE 1
Series % Junior Subordinated Notes Due
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
Section 101. Establishment............................................... 1
Section 102. Definitions................................................. 2
Section 103. Payment of Principal and Interest........................... 2
Section 104. Denominations............................................... 3
Section 105. Global Securities........................................... 3
Section 106. Redemption at the Option of the Corporation................. 3
Section 107. Subordination............................................... 5
Section 108. Paying Agent................................................ 5
ARTICLE 2
Miscellaneous Provisions
Section 201. Recitals by Corporation..................................... 5
Section 202. Ratification and Incorporation of Original Indenture........ 5
Section 203. Executed in Counterparts.................................... 5
</TABLE>
Exhibit A Form of Series % Junior Subordinated Note Due
Exhibit B Certificate of Authentication
- --------
(1) This Table of Contents does not constitute part of the Indenture or have
any bearing upon the interpretation of any of its terms and provisions.
i
<PAGE>
THIS SUPPLEMENTAL INDENTURE is made as of the day of , , by
and between DUKE CAPITAL CORPORATION, a Delaware corporation, having its
principal office at 422 South Church Street, Charlotte, North Carolina 28202
(the "Corporation"), and THE CHASE MANHATTAN BANK, a New York banking
corporation, as Trustee (herein called the "Trustee").
W I T N E S S E T H:
WHEREAS, the Corporation has heretofore entered into a Subordinated Indenture,
dated as of April 1, 1998 (the "Original Indenture") with The Chase Manhattan
Bank, as Trustee;
WHEREAS, the Original Indenture is incorporated herein by this reference and
the Original Indenture, as amended and supplemented to the date hereof,
including by this Supplemental Indenture, is herein called the "Indenture";
WHEREAS, under the Indenture, a new series of Securities may at any time be
established in accordance with the provisions of the Indenture and the terms of
such series may be described by a supplemental indenture executed by the
Corporation and the Trustee;
WHEREAS, the Corporation proposes to create under the Indenture a series of
Securities;
WHEREAS, additional Securities of other series hereafter established, except as
may be limited in the Indenture as at the time supplemented and modified, may
be issued from time to time pursuant to the Indenture as at the time
supplemented and modified; and
WHEREAS, all conditions necessary to authorize the execution and delivery of
this Supplemental Indenture and to make it a valid and binding obligation of
the Corporation have been done or performed.
NOW, THEREFORE, in consideration of the agreements and obligations set forth
herein and for other good and valuable consideration, the sufficiency of which
is hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE 1
Series % Junior Subordinated Notes Due
Section 101. Establishment. There is hereby established a new series of
Securities to be issued under the Indenture, to be designated as the
Corporation's Series % Junior Subordinated Notes Due , (the
"Series Notes").
There are to be authenticated and delivered $ principal amount of
Series Notes, and no further Series Notes shall be authenticated and
delivered except as provided by Section 304, 305, 306, 906 or 1106 of the
Original Indenture. The Series Notes shall be issued in fully registered form
without coupons.
<PAGE>
The Series Notes shall be in substantially the form set out in Exhibit A
hereto, and the form of the Trustee's Certificate of Authentication for the
Series Notes shall be in substantially the form set forth in Exhibit B
hereto.
Each Series Note shall be dated the date of authentication thereof and shall
bear interest from the date of original issuance thereof or from the most
recent Interest Payment Date to which interest has been paid or duly provided
for.
Section 102. Definitions. The following defined terms used herein shall, unless
the context otherwise requires, have the meanings specified below. Capitalized
terms used herein for which no definition is provided herein shall have the
meanings set forth in the Original Indenture.
"Interest Payment Dates" means and .
"Original Issue Date" means , .
"Regular Record Date" means, with respect to each Interest Payment Date, the
close of business on the 15th calendar day prior to such Interest Payment Date.
"Stated Maturity" means , .
Section 103. Payment of Principal and Interest. The unpaid principal amount of
the Series Notes shall bear interest at the rate of % per annum until paid
or duly provided for, such interest to accrue from , or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for. Interest shall be paid semi-annually in arrears on each Interest
Payment Date to the Person or Persons in whose name the Series Notes are
registered on the Regular Record Date for such Interest Payment Date; provided
that interest payable at the Stated Maturity of principal or on a Redemption
Date as provided herein shall be paid to the Person to whom principal is
payable. Any such interest that is not so punctually paid or duly provided for
shall forthwith cease to be payable to the Holders on such Regular Record Date
and may either be paid to the Person or Persons in whose name the Series Notes
are registered at the close of business on a Special Record Date for the payment
of such defaulted interest to be fixed by the Trustee ("Special Record Date"),
notice whereof shall be given to Holders of the Series Notes not less than ten
(10) days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange,
if any, on which the Series Notes may be listed, and upon such notice as may be
required by any such exchange, all as more fully provided in the Original
Indenture.
Payments of interest on the Series Notes shall include interest accrued to
but excluding the respective Interest Payment Dates. Interest payments for the
Series Notes shall be computed and paid 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 Series Notes is not a Business Day, then payment of the interest
payable on such date shall be made on the next succeeding day that is a
Business Day (and without any interest or payment in respect of any such delay)
with the same force and effect as if made on the date the payment was
originally payable. "Business Day" means a day other than (i) a Saturday or a
Sunday, (ii) a day on which banking institutions in New York, New York are
authorized or obligated by law or executive order to remain closed or (iii) a
day on which the Corporate Trust Office is closed for business.
2
<PAGE>
Payment of principal of, premium, if any, and interest on the Series Notes
shall be made in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debts.
Payments of principal of, premium, if any, and interest on Series Notes
represented by a Global Security shall be made by wire transfer of immediately
available funds to the Holder of such Global Security, provided that, in the
case of payments of principal and premium, if any, such Global Security is
first surrendered to the Paying Agent. If any of the Series Notes are no
longer represented by a Global Security, (i) payments of principal, premium, if
any, and interest due at the Stated Maturity or earlier redemption of such
Series Notes shall be made at the office of the Paying Agent upon surrender
of such Series Notes to the Paying Agent and (ii) payments of interest shall
be made, at the option of the Corporation, subject to such surrender where
applicable, (A) by check mailed to the address of the Person entitled thereto
as such address shall appear in the Security Register or (B) by wire transfer
at such place and to such account at a banking institution in the United States
as may be designated in writing to the Trustee at least sixteen (16) days prior
to the date for payment by the Person entitled thereto.
Section 104. Denominations. The Series Notes shall be issued in denominations
of $ or any integral multiple thereof.
Section 105. Global Securities. The Series Notes shall initially be issued in
the form of one or more Global Securities registered in the name of the
Depositary (which initially shall be The Depository Trust Company) or its
nominee. Except under the limited circumstances described below, Series Notes
represented by such Global Security or Global Securities shall not be
exchangeable for, and shall not otherwise be issuable as, Series Notes in
definitive form. The Global Securities described above may not be transferred
except 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 or to a
successor Depositary or its nominee.
A Global Security shall be exchangeable for Series Notes registered in the
names of persons other than the Depositary or its nominee only if (i) the
Depositary notifies the Corporation that it is unwilling or unable to continue
as a Depositary for such Global Security and no successor Depositary shall have
been appointed by the Corporation within 90 days of receipt by the Corporation
of such notification, or if at any time the Depositary ceases to be a clearing
agency registered under the Exchange Act at a time when the Depositary is
required to be so registered to act as such Depositary and no successor
Depositary shall have been appointed by the Corporation within 90 days after it
becomes aware of such cessation, or (ii) the Corporation in its sole discretion
determines that such Global Security shall be so exchangeable. Any Global
Security that is exchangeable pursuant to the preceding sentence shall be
exchangeable for Series Notes registered in such names as the Depositary
shall direct.
Section 106. Redemption at the Option of the Corporation. The Series Notes
shall be redeemable, in whole or from time to time in part, at the option of
the Corporation on any date (a "Redemption Date"), at a Redemption Price equal
to the greater of (i) 100% of the principal amount of the Series Notes to be
redeemed and (ii) the sum of the present values of the remaining scheduled
payments of principal and interest thereon (exclusive of interest accrued to
such Redemption Date) discounted to such Redemption Date on a semi-annual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Treasury
Rate plus basis points, plus, in either case, accrued and unpaid interest on
the principal amount being redeemed to such Redemption Date.
3
<PAGE>
"Treasury Rate" means, with respect to any Redemption Date for the Series
Notes, (i) the yield, under the heading which represents the average for the
immediately preceding week, appearing in the most recently published
statistical release designated "H.15(519)" or any successor publication which
is published weekly by the Board of Governors of the Federal Reserve System 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 Comparable Treasury Issue (if no maturity
is within three months before or after the Stated Maturity, yields for the two
published maturities most closely corresponding to the Comparable Treasury
Issue shall be determined and the 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, calculated using 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. The Treasury Rate shall be
calculated on the third Business Day preceding the Redemption Date.
"Comparable Treasury Issue" means the United States Treasury security selected
by the Independent Investment Banker as having a maturity comparable to the
remaining term of the Series Notes to be redeemed that would be utilized, at
the time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of the Series Notes.
"Independent Investment Banker" means and any
successor firm or, if such firm is unwilling or unable to select the Comparable
Treasury Issue, an independent investment banking institution of national
standing appointed by the Trustee after consultation with the Corporation.
"Comparable Treasury Price" means with respect to any Redemption Date for the
Series Notes (i) the average of Reference Treasury Dealer Quotations for
such Redemption Date, after excluding the highest and lowest such Reference
Treasury Dealer Quotations, or (ii) if the Trustee obtains fewer than such
Reference Treasury Dealer Quotations, the average of all such quotations.
"Reference Treasury Dealer" means each of ,
, , and and their
respective successors; provided, however, that if any of the foregoing shall
cease to be a primary U.S. Government securities dealer in New York City (a
"Primary Treasury Dealer"), the Corporation will substitute therefor another
Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any Redemption Date, 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.
4
<PAGE>
Notwithstanding Section 1104 of the Original Indenture, the notice of
redemption with respect to the foregoing redemption need not set forth the
Redemption Price but only the manner of calculation thereof.
The Corporation shall notify the Trustee of the Redemption Price with respect
to the foregoing redemption promptly after the calculation thereof. The Trustee
shall not be responsible for calculating said Redemption Price.
If less than all of the Series Notes are to be redeemed, the Trustee shall
select the Series Notes or portions of Series Notes to be redeemed by such
method as the Trustee shall deem fair and appropriate. The Trustee may select
for redemption Series Notes and portions of Series Notes in amounts of
whole multiples of $ .
The Series Notes shall not have a sinking fund.
Section 107. Subordination. The indebtedness evidenced by the Series Notes
shall be, to the extent and in the manner set forth in the Original Indenture,
subordinate and junior in right of payment to the prior payment in full of all
Senior Indebtedness (as defined in the Original Indenture) with respect to the
Series Notes, and the Series Notes shall rank pari passu in right of
payment with each other series of Securities issued under the Indenture, with
the exception of any series of Securities which by its terms provides
otherwise.
Section 108. Paying Agent. The Trustee shall initially serve as Paying Agent
with respect to the Series Notes, with the Place of Payment initially being
the Corporate Trust Office.
ARTICLE 2
Miscellaneous Provisions
Section 201. Recitals by Corporation. The recitals in this Supplemental
Indenture are made by the Corporation only and not by the Trustee, and all of
the provisions contained in the Original Indenture in respect of the rights,
privileges, immunities, powers and duties of the Trustee shall be applicable in
respect of the Series Notes and this Supplemental Indenture as fully and
with like effect as if set forth herein in full.
Section 202. Ratification and Incorporation of Original Indenture. As
supplemented hereby, the Original Indenture is in all respects ratified and
confirmed, and the Original Indenture and this Supplemental Indenture shall
be read, taken and construed as one and the same instrument.
Section 203. Executed in Counterparts. This Supplemental Indenture may be
executed in several counterparts, each of which shall be deemed to be an
original, and such counterparts shall together constitute but one and the same
instrument.
5
<PAGE>
IN WITNESS WHEREOF, each party hereto has caused this instrument to be signed
in its name and behalf by its duly authorized officers, all as of the day and
year first above written.
Duke Capital Corporation
By: _________________________________
Attest:
_____________________________
The Chase Manhattan Bank,
as Trustee
By: _________________________________
Attest:
_____________________________
6
<PAGE>
EXHIBIT A
FORM OF
SERIES % JUNIOR SUBORDINATED NOTE
DUE
THE INDEBTEDNESS EVIDENCED BY THIS SECURITY IS, TO THE EXTENT PROVIDED IN THE
INDENTURE, SUBORDINATE AND SUBJECT IN RIGHT OF PAYMENT TO THE PRIOR PAYMENT IN
FULL OF ALL SENIOR INDEBTEDNESS, AND THIS SECURITY IS ISSUED SUBJECT TO THE
PROVISIONS OF THE INDENTURE WITH RESPECT THERETO.
No. CUSIP No.
DUKE CAPITAL CORPORATION
SERIES % JUNIOR SUBORDINATED NOTE
DUE
Principal Amount:
Regular Record Date: 15th calendar day prior to Interest Payment Date
Original Issue Date: ,
Stated Maturity: ,
Interest Payment Dates: and
Interest Rate: % per annum
Authorized Denomination: $ or any integral multiple thereof
Duke Capital Corporation, a Delaware corporation (the "Corporation,"
which term includes any successor corporation under the Indenture
referred to on the reverse hereof), for value received, hereby promises
to pay to , or registered assigns, the principal
sum of DOLLARS ($ ) on the Stated Maturity shown above
and to pay interest thereon from the Original Issue Date shown above, or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, semi-annually in arrears on each Interest Payment Date as
specified above, commencing on the Interest Payment Date next succeeding the
Original Issue Date shown above and on the Stated Maturity at the rate per annum
shown above (the "Interest Rate") until the principal hereof is paid or made
available for payment and on any overdue principal and on any overdue
installment of interest. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date (other than an Interest Payment Date
that is the Stated Maturity or a Redemption Date) will, as provided in the
Indenture, be paid to the Person in whose name this Series % Junior Subordinated
Note Due (this "Security") is registered on the close of business on the Regular
Record Date as specified above next preceding such Interest Payment Date;
provided that any interest payable at Stated Maturity or on a Redemption Date
will be paid to the Person to whom principal is payable. Except as otherwise
provided in the Indenture, any such interest not so punctually paid or duly
provided for will forthwith cease to be payable to the
A-1
<PAGE>
Holder on such Regular Record Date and may either be paid to the Person in
whose name this Security is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange, if any, on which the Securities of this series shall be
listed, and upon such notice as may be required by any such exchange, all as
more fully provided in the Indenture.
Payments of interest on this Security will include interest accrued to but
excluding the respective Interest Payment Dates. Interest payments for this
Security shall be computed and paid 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 this
Security 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 payment in respect of any such delay) with the same
force and effect as if made on the date the payment was originally payable.
"Business Day" means a day other than (i) a Saturday or a Sunday, (ii) a day on
which banking institutions in New York, New York are authorized or obligated by
law or executive order to remain closed or (iii) a day on which the Corporate
Trust Office is closed for business.
Payment of principal of, premium, if any, and interest on the Securities of
this series shall be made in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts. Payments of principal of, premium, if any, and interest on
Securities of this series represented by a Global Security shall be made by
wire transfer of immediately available funds to the Holder of such Global
Security, provided that, in the case of payments of principal and premium, if
any, such Global Security is first surrendered to the Paying Agent. If any of
the Securities of this series are no longer represented by a Global Security,
(i) payments of principal, premium, if any, and interest due at the Stated
Maturity or earlier redemption of such Securities shall be made at the office
of the Paying Agent upon surrender of such Securities to the Paying Agent and
(ii) payments of interest shall be made, at the option of the Corporation,
subject to such surrender where applicable, (A) by check mailed to the address
of the Person entitled thereto as such address shall appear in the Security
Register or (B) by wire transfer at such place and to such account at a banking
institution in the United States as may be designated in writing to the Trustee
at least sixteen (16) days prior to the date for payment by the Person entitled
thereto.
The indebtedness evidenced by this Security is, to the extent and in the manner
set forth in the Indenture, subordinate in right of payment to the prior
payment in full of all Senior Indebtedness (as defined in the Indenture), and
this Security is issued subject to the provisions of the Indenture with respect
thereto. Each Holder of this Security, by accepting the same, (a) agrees to and
shall be bound by such provisions, (b) authorizes and directs the Trustee on
his behalf to take such action as may be necessary or appropriate to effectuate
the subordination so provided and (c) appoints the Trustee his attorney-in-fact
for any and all such purposes. Each Holder hereof, by his acceptance hereof,
waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Indebtedness whether now
outstanding or hereafter incurred and waives reliance by each such holder upon
said provisions.
A-2
<PAGE>
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS SECURITY SET FORTH
ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE
SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been executed by the
Trustee by manual signature, this Security shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Corporation has caused this instrument to be duly
executed under its corporate seal.
Dated:
Duke Capital Corporation
By: _________________________________
Attest:
_____________________________________
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to in
the within-mentioned Indenture.
The Chase Manhattan Bank,
as Trustee
By: _________________________________
A-3
<PAGE>
(REVERSE SIDE OF SECURITY)
This Security is one of a duly authorized issue of Securities of the
Corporation (the "Securities"), issued and issuable in one or more series under
a Subordinated Indenture, dated as of April 1, 1998, as supplemented (the
"Indenture"), between the Corporation and The Chase Manhattan Bank, as Trustee
(the "Trustee," which term includes any successor trustee under the Indenture),
to which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights, limitation of rights, duties and
immunities thereunder of the Corporation, the Trustee and the Holders of the
Securities issued thereunder and of the terms upon which said Securities are,
and are to be, authenticated and delivered. This Security is one of the series
designated on the face hereof as Series % Junior Subordinated Notes Due
in the aggregate principal amount of up to $ . Capitalized terms used
herein for which no definition is provided herein shall have the meanings set
forth in the Indenture.
The Securities of this series will be redeemable, in whole or from time to time
in part, at the option of the Corporation on any date (a "Redemption Date"), at
a Redemption Price equal to the greater of (i) 100% of the principal amount of
the Securities of this series to be redeemed and (ii) the sum of the present
values of the remaining scheduled payments of principal and interest thereon
(exclusive of interest accrued to such Redemption Date) discounted to such
Redemption Date on a semi-annual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Treasury Rate plus basis points, plus, in either
case, accrued and unpaid interest on the principal amount being redeemed to
such Redemption Date.
"Treasury Rate" means, with respect to any Redemption Date for the Securities
of this series, (i) the yield, under the heading which represents the average
for the immediately preceding week, appearing in the most recently published
statistical release designated "H.15(519)" or any successor publication which
is published weekly by the Board of Governors of the Federal Reserve System 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 Comparable Treasury Issue (if no maturity
is within three months before or after the Stated Maturity, yields for the two
published maturities most closely corresponding to the Comparable Treasury
Issue shall be determined and the 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, calculated using 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. The Treasury Rate shall be
calculated on the third Business Day preceding the Redemption Date.
"Comparable Treasury Issue" means the United States Treasury security selected
by the Independent Investment Banker as having a maturity comparable to the
remaining term of the Securities of this series to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of the Securities of this series.
A-4
<PAGE>
"Independent Investment Banker" means and any successor
firm or, if such firm is unwilling or unable to select the Comparable Treasury
Issue, an independent investment banking institution of national standing
appointed by the Trustee after consultation with the Corporation.
"Comparable Treasury Price" means with respect to any Redemption Date for the
Securities of this series (i) the average of Reference Treasury Dealer
Quotations for such Redemption Date, after excluding the highest and lowest
such Reference Treasury Dealer Quotations, or (ii) if the Trustee obtains fewer
than such Reference Treasury Dealer Quotations, the average of all such
quotations.
"Reference Treasury Dealer" means each of , ,
, and and their respective
successors; provided, however, that if any of the foregoing shall cease to be a
primary U.S. Government securities dealer in New York City (a "Primary Treasury
Dealer"), the Corporation will substitute therefor another Primary Treasury
Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any Redemption Date, 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.
Notice of any redemption by the Corporation will be mailed at least 30 days but
not more than 60 days before any Redemption Date to each Holder of Securities
of this series to be redeemed. If less than all the Securities of this series
are to be redeemed at the option of the Corporation, the Trustee shall select,
in such manner as it shall deem fair and appropriate, the Securities of this
series to be redeemed in whole or in part. The Trustee may select for
redemption Securities of this series and portions of Securities of this series
in amounts of whole multiples of $ .
If an Event of Default with respect to the Securities of this series shall
occur and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner, with the effect and subject to the
conditions provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Corporation and the rights of the Holders of the Securities of all series
affected under the Indenture at any time by the Corporation and the Trustee
with the consent of the Holders of not less than a majority in principal amount
of the Outstanding Securities of all series affected thereby (voting as one
class). The Indenture contains provisions permitting the Holders of not less
than a majority in principal amount of the Outstanding Securities of all series
with respect to which a default under the Indenture shall have occurred and be
continuing (voting as one class), on behalf of the Holders of the Securities of
all such series, to waive, with certain exceptions, such default under the
Indenture and its consequences. The Indenture also permits the Holders of not
less than a majority in principal amount of the Securities of each series at
the time Outstanding, on behalf of the Holders of all Securities of such
series, to waive
A-5
<PAGE>
compliance by the Corporation with certain provisions of the Indenture
affecting such series. Any such consent or waiver by the Holder of this
Security shall be conclusive and binding upon such Holder and upon all future
Holders of this Security and of any Security issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this Security or of
the Indenture shall alter or impair the obligation of the Corporation, which is
absolute and unconditional, to pay the principal of and interest on this
Security at the times, place and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Security Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Corporation for such purpose, duly endorsed by, or accompanied by
a written instrument of transfer in form satisfactory to the Corporation and
the Security Registrar and duly executed by, the Holder hereof or his attorney
duly authorized in writing, and thereupon one or more new Securities of this
series, of authorized denominations and of like tenor and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees. No service charge shall be made for any such registration of
transfer or exchange, but the Corporation may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
As provided in and subject to the provisions of the Indenture, the Holder of
this Security shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than a majority in principal
amount of the Securities of this series at the time Outstanding shall have made
written request to the Trustee to institute proceedings in respect of such
Event of Default as Trustee and offered the Trustee reasonable indemnity, and
the Trustee shall not have received from the Holders of a majority in principal
amount of Securities of this series at the time Outstanding a direction
inconsistent with such request and shall have failed to institute any such
proceeding for 60 days after receipt of such notice, request and offer of
indemnity. The foregoing shall not apply to any suit instituted by the Holder
of this Security for the enforcement of any payment of principal hereof or any
premium or interest hereon on or after the respective due dates expressed
herein.
The Indenture contains provisions for defeasance at any time of the entire
indebtedness of the Securities of this series and for covenant defeasance at
any time of certain covenants in the Indenture upon compliance with certain
conditions set forth in the Indenture.
Prior to due presentment of this Security for registration of transfer, the
Corporation, the Trustee and any agent of the Corporation or the Trustee may
treat the Person in whose name this Security is registered as the owner hereof
for all purposes, whether or not this Security be overdue, and neither the
Corporation, the Trustee nor any such agent shall be affected by notice to the
contrary.
A-6
<PAGE>
The Securities of this series are issuable only in registered form without
coupons in denominations of $ and any integral multiple thereof. As provided
in the Indenture and subject to the limitations therein set forth, Securities
of this series are exchangeable for a like aggregate principal amount of
Securities of this series of a different authorized denomination, as requested
by the Holder surrendering the same upon surrender of the Security or
Securities to be exchanged at the office or agency of the Corporation.
This Security shall be governed by, and construed in accordance with, the
internal laws of the State of New York.
A-7
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
UNIF GIFT MIN ACT -- _____ Custodian _____
TEN COM -- as tenants in common
(Cust) (Minor)
TEN ENT -- as tenants by the entireties
under Uniform Gifts to
Minors Act _____________
(State)
JT TEN -- as joint tenants with rights of survivorship and not as tenants in
common
Additional abbreviations may also be used though not on the above list.
- -------------------------------------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto ______
________ (please insert Social Security or other identifying number of assignee)
- -------------------------------------------------------------------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF
ASSIGNEE
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing
- -------------------------------------------------------------------------------
agent to transfer said Security on the books of the Corporation, with full
power of substitution in the premises.
Dated: __________________________ __________________________________________
------------------------------------------
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the within instrument in
every particular without alteration or
enlargement, or any change whatever.
A-8
<PAGE>
EXHIBIT B
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to in
the within-mentioned Indenture.
The Chase Manhattan Bank,
as Trustee
By: _________________________________
Authorized Officer
B-1
<PAGE>
EXHIBIT 4.4-B
DUKE CAPITAL CORPORATION
TO
THE CHASE MANHATTAN BANK
TRUSTEE
----------------
SUPPLEMENTAL INDENTURE
DATED AS OF ,
----------------
$
SERIES % JUNIOR SUBORDINATED NOTES
DUE ,
----------------
<PAGE>
TABLE OF CONTENTS (1)
ARTICLE 1
Series % Junior Subordinated Notes
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
Section 101. Establishment............................................. 1
Section 102. Definitions............................................... 2
Section 103. Payment of Principal and Interest......................... 3
Section 104. Deferral of Interest Payments............................. 4
Section 105. Denominations............................................. 5
Section 106. Global Securities......................................... 5
Section 107. Redemption................................................ 5
Section 108. Additional Interest....................................... 6
Section 109. Limitations on Dividend and Certain Other Payments........ 6
Section 110. Covenants Regarding Securities Trust...................... 7
Section 111. No Fiduciary Duty of Trustee to Holders of Trust
Securities................................................ 7
Section 112. Listing of Series Notes................................ 7
Section 113. Covenant Defeasance....................................... 7
Section 114. Set-Off................................................... 7
Section 115. Subordination............................................. 7
Section 116. Paying Agent.............................................. 8
ARTICLE 2
Miscellaneous Provisions
Section 201. Recitals by Corporation................................... 8
Section 202. Ratification and Incorporation of Original Indenture...... 8
Section 203. Executed in Counterparts.................................. 8
Section 204. Assignment................................................ 8
Section 205. Enforcement by Holders of Preferred Securities of Right of
Holders to Receive Principal and Interest................. 8
</TABLE>
- --------
(1) This Table of Contents does not constitute part of the Indenture or have
any bearing upon the interpretation of any of its terms and provisions.
i
<PAGE>
THIS SUPPLEMENTAL INDENTURE is made as of the day of , , by
and between DUKE CAPITAL CORPORATION, a Delaware corporation, having its
principal office at 422 South Church Street, Charlotte, North Carolina 28202
(the "Corporation"), and THE CHASE MANHATTAN BANK, a New York banking
corporation, as Trustee (herein called the "Trustee").
W I T N E S S E T H:
WHEREAS, the Corporation has heretofore entered into a Subordinated Indenture,
dated as of April 1, 1998 (the "Original Indenture") with The Chase Manhattan
Bank, as Trustee;
WHEREAS, the Original Indenture is incorporated herein by this reference and
the Original Indenture, as amended and supplemented to the date hereof,
including by this Supplemental Indenture, is herein called the "Indenture";
WHEREAS, under the Indenture, a new series of Securities may at any time be
established in accordance with the provisions of the Indenture and the terms of
such series may be described by a supplemental indenture executed by the
Corporation and the Trustee;
WHEREAS, the Corporation proposes to create under the Indenture a series of
Securities;
WHEREAS, additional Securities of other series hereafter established, except as
may be limited in the Indenture as at the time supplemented and modified, may
be issued from time to time pursuant to the Indenture as at the time
supplemented and modified; and
WHEREAS, all conditions necessary to authorize the execution and delivery of
this Supplemental Indenture and to make it a valid and binding obligation
of the Corporation have been done or performed.
NOW, THEREFORE, in consideration of the agreements and obligations set forth
herein and for other good and valuable consideration, the sufficiency of which
is hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE 1
Series % Junior Subordinated Notes Due
Section 101. Establishment. There is hereby established a new series of
Securities to be issued under the Indenture, to be designated as the
Corporation's Series % Junior Subordinated Notes Due , (the
"Series Notes").
There are to be authenticated and delivered $ principal amount of Series
Notes, and no further Series Notes shall be authenticated and delivered
except as provided by Sections 304, 305, 306, 906 or 1106 of the Original
Indenture. The Series Notes shall be issued in definitive fully registered
form without coupons.
1
<PAGE>
The Series Notes shall be in substantially the form set out in Exhibit A
hereto. The entire principal amount of the Series Notes shall initially be
evidenced by one certificate issued to the Property Trustee of Duke Capital
Financing Trust [ ].
The form of the Trustee's Certificate of Authentication for the Series Notes
shall be in substantially the form set forth in Exhibit B hereto.
Each Series Note shall be dated the date of authentication thereof and shall
bear interest from the date of original issuance thereof or from the most
recent Interest Payment Date to which interest has been paid or duly provided
for.
Section 102. Definitions. The following defined terms used herein shall, unless
the context otherwise requires, have the meanings specified below. Capitalized
terms used herein for which no definition is provided herein shall have the
meanings set forth in the Original Indenture.
"Additional Interest" means (i) such additional amounts as may be required so
that the net amounts received and retained by the Holder (if the Holder is the
Securities Trust) after paying taxes, duties, assessments or governmental
charges of whatever nature (other than withholding taxes) imposed by the United
States or any other taxing authority will not be less than the amounts the
Holder would have received had not such taxes, duties, assessments, or other
governmental charges been imposed; and (ii) such interest as shall accrue on
interest due and not paid on an Interest Payment Date, accruing at the rate of
% per annum from the applicable Interest Payment Date to the date of payment,
compounded quarterly, on each Interest Payment Date, to the extent permitted by
applicable law.
"Business Day" means a day other than (i) a Saturday or a Sunday, (ii) a day on
which banks in New York, New York are authorized or obligated by law or
executive order to remain closed or (iii) a day on which the Corporate Trust
Office or the principal corporate trust office of the Property Trustee is
closed for business.
"Deferred Interest" means such installments of interest as are not paid during
any Extension Period, plus Additional Interest (as defined in clause (ii) of
the definition thereof) thereon.
"Extension Period" means any period during which the Corporation has elected to
defer payments of interest, which deferral may be for a period of up to twenty
(20) consecutive quarters.
"Guarantee" means the Guarantee Agreement executed and delivered by the
Corporation and The Chase Manhattan Bank, as guarantee trustee, for the benefit
of the holders of the Preferred Securities, as such Agreement may be amended
from time to time.
"Interest Payment Dates" means March 31, June 30, September 30 and December 31
of each year.
"Investment Company Act Event" means that the Administrative Trustees (as
defined in the Trust Agreement) and the Corporation shall have received 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 written 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
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<PAGE>
Securities 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 Original Issue Date.
"Original Issue Date" means , .
"Outstanding," when used with respect to the Series Notes, means, as of the
date of determination, all Series Notes theretofore authenticated and
delivered under the Indenture, except:
(i) Series Notes theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(ii) Series Notes for whose payment or redemption the necessary amount of
money or money's worth has been theretofore deposited with the Trustee or
any Paying Agent (other than the Corporation) in trust or set aside and
segregated in trust by the Corporation (if the Corporation shall act as its
own Paying Agent) for the Holders of such Series Notes; provided that if
such Series Notes are to be redeemed, notice of such redemption has been
duly given pursuant to the Indenture or provision therefor satisfactory to
the Trustee has been made;
(iii) Series Notes as to which Defeasance has been effected pursuant to
Section 1302 of the Original Indenture; and
(iv) Series Notes that have been paid or in exchange for or in lieu of
which other Series Notes have been authenticated and delivered pursuant
to the Indenture, other than any such Series Notes in respect of which
there shall have been presented to the Trustee proof satisfactory to it
that such Series Notes are held by a bona fide purchaser in whose hands
such Series Notes are valid obligations of the Corporation;
provided, however, that in determining, during any period in which any Series
Notes are owned by any Person other than the Corporation or any Affiliate
thereof, whether the Holders of the requisite principal amount of Outstanding
Series Notes have given, made or taken any request, demand, authorization,
direction, notice, consent, waiver or other action hereunder as of any date,
Series Notes owned, whether of record or beneficially, by the Corporation or
any Affiliate thereof (with the exception of the Securities Trust) shall be
disregarded and deemed not to be Outstanding. In determining whether the
Trustee shall be protected in relying upon such request, demand, authorization,
direction, notice, consent, waiver or other action, only Series Notes that
the Trustee knows to be so owned by the Corporation or an Affiliate of the
Corporation (with the exception of the Securities Trust) in the above
circumstances shall be so disregarded. Series Notes so owned that have been
pledged in good faith may be regarded as Outstanding if the pledgee establishes
to the satisfaction of the Trustee the pledgee's right so to act with respect
to such Series Notes and that the pledgee is not the Corporation or any
Affiliate of the Corporation.
"Preferred Securities" means the % Trust Preferred Securities issued by the
Securities Trust.
"Property Trustee," when used with respect to the Series Notes, means the
Person designated as such in the Trust Agreement.
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<PAGE>
"Regular Record Date" means, with respect to each Interest Payment Date, the
close of business on the 15th calendar day preceding such Interest Payment
Date.
"Securities Trust" means Duke Capital Financing Trust [ ], a statutory business
trust formed by the Corporation under Delaware law to issue the Trust
Securities, the proceeds of which will be used to purchase Series Notes, or a
successor thereof.
"Special Event" means an Investment Company Act Event or Tax Event.
"Stated Maturity" means , .
"Tax Event" means that the Administrative Trustees and the Corporation shall
have received an Opinion of Counsel experienced in such matters to the effect
that, as a result of (a) any amendment to, or change (including any announced
prospective change) in, laws (or any regulations thereunder) of the United
States or any political subdivision or taxing authority thereof or therein or
(b) any amendment to, or change in, an interpretation or application of such
laws or regulations, there is more than an insubstantial risk that (i) the
Securities Trust would be subject to United States federal income tax with
respect to income accrued or received on the Series Notes, (ii) interest
payable on the Series Notes would not be deductible by the Corporation for
United States federal income tax purposes, or (iii) the Securities Trust would
be subject to more than a de minimis amount of other taxes, duties or other
governmental charges, which change or amendment becomes effective on or after
the Original Issue Date.
"Trust Agreement" means the Amended and Restated Trust Agreement that governs
the affairs of the Securities Trust.
"Trust Securities" means the securities issued by the Securities Trust
evidencing the entire beneficial interest therein.
Section 103. Payment of Principal and Interest. The unpaid principal amount of
the Series Notes shall bear interest at the rate of % per annum until paid
or duly provided for, such interest to accrue from , or from the
most recent Interest Payment Date to which interest has been paid or duly
provided for. Interest shall be paid quarterly in arrears on each Interest
Payment Date commencing , to the Person in whose name the Series
Notes are registered on the Regular Record Date for such Interest Payment Date;
provided that interest payable at the Stated Maturity of principal or on a
Redemption Date as provided herein will be paid to the Person to whom principal
is payable. So long as an Extension Period is not occurring, any such interest
that is not so punctually paid or duly provided for will forthwith cease to be
payable to the Holders on such Regular Record Date and may either be paid to
the Person or Persons in whose name the Series Notes are registered at the
close of business on a Special Record Date for the payment of such defaulted
interest to be fixed by the Trustee ("Special Record Date"), notice whereof
shall be given to Holders of the Series Notes not less than ten (10) days
prior to such Special Record Date, or be paid at any time in any other lawful
manner not inconsistent with the requirements of any securities exchange, if
any, on which the Series Notes may be listed, and upon such notice as may be
required by any such exchange, all as more fully provided in the Original
Indenture.
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<PAGE>
Payments of interest on the Series Notes will include interest accrued to but
excluding the respective Interest Payment Dates. Interest payments for the
Series Notes shall be computed and paid 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 Series Notes 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 payment in respect of any such delay), except
that, if such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on the date the payment was
originally payable.
Payment of the principal and interest (including Additional Interest, if any)
on the Series Notes shall be made at the office of the Paying Agent in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts, with any such payment
that is due at the Stated Maturity or at earlier redemption of any Series
Notes being made upon surrender of such Series Notes to the Paying Agent.
Payments of interest (including interest on any Interest Payment Date) will be
made, subject to such surrender where applicable, at the option of the
Corporation, (i) by check mailed to the address of the Person entitled thereto
as such address shall appear in the Security Register or (ii) by wire transfer
at such place and to such account at a banking institution in the United States
as may be designated in writing to the Trustee at least sixteen (16) days prior
to the date for payment by the Person entitled thereto.
The Corporation shall pay, as additional interest on the Series Notes, when
due to the United States or any other taxing authority, the amounts set forth
in clause (i) of the definition of Additional Interest.
Section 104. Deferral of Interest Payments. The Corporation has the right at
any time and from time to time to extend the interest payment period of the
Series Notes for up to twenty (20) consecutive quarters (each, an "Extension
Period"), during which Extension Period the Corporation shall have the right to
make partial payments of interest on any Interest Payment Date; provided,
however, that no such Extension Period may extend beyond the Stated Maturity.
Notwithstanding the foregoing, the Corporation has no right to extend its
obligation to pay such amounts as are defined in clause (i) of the definition
of Additional Interest. Prior to the termination of any such Extension Period,
the Corporation may further extend the interest payment period; provided that
such Extension Period, together with all such previous and further extensions
of that Extension Period, shall not exceed twenty (20) consecutive quarters.
Upon the termination of any such Extension Period and upon the payment of all
accrued and unpaid interest and any Additional Interest then due, the
Corporation may select a new Extension Period, subject to the above limitations
and requirements.
Upon the termination of any Extension Period, which termination shall be on an
Interest Payment Date, the Corporation shall pay all Deferred Interest on the
next succeeding Interest Payment Date to the Person or Persons in whose name
the Series Notes are registered on the Regular Record Date for such Interest
Payment Date; provided that Deferred Interest payable at Stated Maturity or on
any Redemption Date will be paid to the Person or Persons to whom principal is
payable.
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The Corporation shall give the Holder or Holders of the Series Notes and the
Trustee notice, as provided in Sections 105 and 106, respectively, of the
Original Indenture, of its selection or extension of an Extension Period at
least one Business Day prior to the earlier of (i) the Regular Record Date
relating to the Interest Payment Date on which the Extension Period is to
commence or relating to the Interest Payment Date on which an Extension Period
that is being extended would otherwise terminate, or (ii) the date the
Corporation or the Securities Trust is required to give notice to the New York
Stock Exchange or other applicable self-regulatory organization of the record
date or the date such distributions are payable. The Corporation shall cause
the Securities Trust to give notice of the Corporation's selection of such
Extension Period to Holders of the Trust Securities. The month in which any
notice is given pursuant to the immediately preceding sentence of this Section
shall constitute the first month of the first quarter of the twenty (20)
consecutive quarters which comprise the maximum Extension Period.
At any time any of the foregoing notices are given to the Trustee, the
Corporation shall give to the Paying Agent for the Series Notes such
information as said Paying Agent shall reasonably require in order to fulfill
its tax reporting obligations with respect to such Series Notes.
Section 105. Denominations. The Series Notes may be issued in denominations
of $ or any integral multiple thereof.
Section 106. Global Securities. If the Series Notes are distributed to
holders of the Trust Securities in liquidation of such holders' interests
therein, the Series Notes will be issued in the form of one or more Global
Securities registered in the name of the Depositary (which shall be The
Depository Trust Company) or its nominee. Except under the limited
circumstances described below, Series Notes represented by such Global
Security or Global Securities will not be exchangeable for, and will not
otherwise be issuable as, Series Notes in definitive form. The Global
Securities described above may not be transferred except 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 or to a successor Depositary or its
nominee.
Owners of beneficial interests in such a Global Security will not be considered
the Holders thereof for any purpose under the Indenture, and no Global Security
representing a Series Note shall be exchangeable, except for another Global
Security of like denomination and tenor to be registered in the name of the
Depositary or its nominee or to a successor Depositary or its nominee or except
as described below. The rights of Holders of such Global Security shall be
exercised only through the Depositary.
A Global Security shall be exchangeable for Series Notes registered in the
names of persons other than the Depositary or its nominee only if (i) the
Depositary notifies the Corporation that it is unwilling or unable to continue
as a Depositary for such Global Security and no successor Depositary shall have
been appointed by the Corporation within 90 days of receipt by the Corporation
of such notification, or if at any time the Depositary ceases to be a clearing
agency registered under the Exchange Act at a time when the Depositary is
required to be so registered to act as such Depositary and no successor
Depositary shall have been appointed by the Corporation within 90 days after it
becomes aware of such cessation, or (ii) the Corporation in its sole discretion
determines that such Global Security shall be so exchangeable. Any Global
Security that is
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<PAGE>
exchangeable pursuant to the preceding sentence shall be exchangeable for
Series Notes registered in such names as the Depositary shall direct.
Section 107. Redemption. The Series Notes shall be subject to redemption at
the option of the Corporation, in whole or in part, without premium or penalty,
at any time or from time to time on or after , , at a Redemption
Price equal to 100% of the principal amount to be redeemed plus accrued but
unpaid interest (including any Additional Interest) to the Redemption Date;
provided, however, that, if a redemption in part shall result in the delisting
of the Preferred Securities, the Corporation may redeem the Series Notes only
in whole. In addition, upon the occurrence of a Special Event, the Corporation
may, within ninety (90) days following the occurrence thereof and subject to
the terms and conditions of the Indenture, redeem the Series Notes, in whole,
at a price equal to 100% of the principal amount to be redeemed plus any
accrued but unpaid interest (including Additional Interest, if any) to the
Redemption Date.
In the event of redemption of the Series Notes in part only, a new Series
Note or Notes for the unredeemed portion shall be issued in the name or names
of the Holders thereof upon the surrender thereof.
The Series Notes shall not have a sinking fund.
Notice of redemption shall be given as provided in Section 1104 of the Original
Indenture. Notwithstanding the foregoing, no notice of redemption that is given
pursuant to such Section with respect to any Series Notes shall, while any
Preferred Securities are outstanding, contain a condition that provides that
redemption of the Series Notes, or the part thereof, specified therein, shall
be conditional upon receipt by the Trustee or the Paying Agent for such Series
Notes, on or prior to the date fixed for such redemption, of money sufficient
to pay the principal of and any interest on such Series Notes. Any notice
provided to the Trustee under Section 1102 of the Original Indenture shall also
be provided by the Corporation to the Property Trustee; provided that the
Corporation shall provide notice pursuant to such Section 1102 on a date less
than 45 days prior to the Redemption Date only if such shorter notice is
satisfactory to both the Trustee and the Property Trustee.
Any redemption of less than all of the Series Notes shall, with respect to
the principal thereof, be divisible by $ .
Section 108. Additional Interest. Whenever there is mentioned in the Indenture,
in any context, the payment of the principal of, or any premium or interest on,
or in respect of, Securities of any series, such mention shall, with respect to
the Series Notes, be deemed to include mention of the payment of Additional
Interest provided for by the terms of the Series Notes to the extent that, in
such context, Additional Interest is, was or would be payable in respect
thereof pursuant to such terms, and express mention of the payment of
Additional Interest in any provisions of this Supplemental Indenture shall
not be construed as excluding Additional Interest in those provisions of the
Original Indenture or this Supplemental Indenture in which such express
mention is not made.
If, subsequent to the date that a satisfaction and discharge or Defeasance is
effected pursuant to Section 401 or 1302, respectively, of the Original
Indenture, Additional Interest (for purposes of this
7
<PAGE>
paragraph, as defined in clause (i) of the definition thereof) (in excess of
that established as of the date that such discharge or Defeasance is effected)
becomes payable in respect of the Series Notes so discharged or defeased, the
Corporation shall irrevocably deposit or cause to be irrevocably deposited in
accordance with the provisions of Section 401 or 1304 of the Original
Indenture, as the case may be, within ten Business Days prior to the date the
first payment in respect of any portion of such excess Additional Interest
becomes due, such additional moneys or Government Obligations as are necessary
to satisfy the provisions of Section 401 or 1304 of the Original Indenture, as
the case may be, as if a discharge or Defeasance were being effected as of the
date of such subsequent deposit.
Except as otherwise provided in or pursuant to the Indenture, at least 10 days
prior to the first Interest Payment Date upon which Additional Interest (for
purposes of this paragraph, as defined in clause (i) of the definition thereof)
shall be payable, and at least 10 days prior to each date of payment of
principal and any premium or interest if there has been any change with respect
to the information set forth in the Officers' Certificate hereinafter
mentioned, the Corporation shall furnish the Trustee and any Paying Agent, if
other than the Trustee or the Corporation, with an Officers' Certificate
stating the amount of the Additional Interest payable per minimum authorized
denomination of the Series Notes.
Section 109. Limitations on Dividend and Certain Other Payments. The
Corporation covenants, for the benefit of the Holders of the Series Notes,
that, subject to the next succeeding sentence, (a) the Corporation shall not
declare or pay any dividend on, or make any distributions with respect to, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of
its capital stock, and (b) the Corporation shall not make any payment of
interest, principal or premium, if any, on or repay, repurchase or redeem any
debt securities (including guarantees other than the Guarantee) issued by the
Corporation which rank pari passu with or junior to the Series Notes (i) if
at such time the Corporation shall have given notice of its election to extend
an interest payment period for the Series Notes and such extension shall be
continuing or (ii) if at such time an Event of Default with respect to the
Series Notes shall have occurred and be continuing. The preceding sentence,
however, shall not restrict (A) any of the actions described in the preceding
sentence resulting from any reclassification of the Corporation's capital stock
or the exchange or conversion of one class or series of the Corporation's
capital stock for another class or series of the Corporation's capital stock or
(B) dividends or distributions in capital stock of the Corporation.
Section 110. Covenants Regarding Securities Trust. For so long as the Trust
Securities remain outstanding, the Corporation covenants (i) directly or
indirectly to maintain 100% ownership of the Common Securities (as defined in
the Trust Agreement) of the Securities Trust; provided, however, that any
permitted successor of the Corporation under the Indenture may succeed to the
Corporation's ownership of such Common Securities, and (ii) to use its
reasonable efforts to cause the Securities Trust (a) to remain a statutory
business trust, except in connection with the distribution of Series Notes to
the holders of Trust Securities in liquidation of the Securities Trust, the
redemption of all of the Trust Securities, or certain mergers, consolidations
or amalgamations, each as permitted under the Trust Agreement, and (b) to
otherwise continue to be classified as a grantor trust for United States
federal income tax purposes. The Corporation shall deliver to the Trustee, no
later than the Business Day on which the event occurs, written notice of the
liquidation, dissolution
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<PAGE>
or winding-up of the Securities Trust if such liquidation, dissolution or
winding-up would occur earlier than the Stated Maturity of the Series Notes
owned by such Securities Trust.
Section 111. No Fiduciary Duty of Trustee to Holders of Trust Securities. The
Trustee shall not be deemed to owe any fiduciary duty to the holders of Trust
Securities and shall be entitled to rely on the delivery to it of a written
notice by a Person representing himself to be a holder of a Trust Security to
establish that such Person is such a holder.
Section 112. Listing of Series Notes. If the Series Notes are to be issued
as a Global Security in connection with the distribution of the Series Notes
to the holders of the Preferred Securities, the Corporation shall use its best
efforts to list such Series Notes on the New York Stock Exchange or any other
exchange on which such Preferred Securities are then listed. The Corporation
shall notify the Trustee if and when the Series Notes become admitted to
trading on the New York Stock Exchange or any other national securities
exchange.
Section 113. Covenant Defeasance. Section 1303 of the Original Indenture shall
not apply to any of the Series Notes.
Section 114. Set-Off. Notwithstanding anything to the contrary in the Indenture
or in any Series Note, prior to the dissolution of the Securities Trust, the
Corporation shall have the right to set off and apply against any payment it is
otherwise required to make hereunder or thereunder with respect to the
principal of or interest (including any Additional Interest) on the Series
Notes with and to the extent the Corporation has theretofore made, or is
concurrently on the date of such payment making, a payment with respect to the
Preferred Securities under the Guarantee. Contemporaneously with, or as
promptly as practicable after, any such payment under the Guarantee, the
Corporation shall deliver to the Trustee an Officers' Certificate (upon which
the Trustee shall be entitled to rely conclusively without any requirement to
investigate the facts contained therein) to the effect that such payment has
been made and that, as a result of such payment, the corresponding payment
under the Series Notes has been set off in accordance with this Section 114.
Section 115. Subordination. The indebtedness evidenced by the Series Notes
shall be, to the extent and in the manner set forth in the Original Indenture,
subordinate and junior in right of payment to the prior payment in full of all
Senior Indebtedness (as defined in the Original Indenture) with respect to the
Series Notes, and the Series Notes shall rank pari passu in right of
payment with each other series of Securities issued under the Indenture, with
the exception of any series of Securities which by its terms provides
otherwise.
Section 116. Paying Agent. The Trustee shall initially serve as Paying Agent
with respect to the Series Notes, with the Place of Payment initially being
the Corporate Trust Office of the Trustee.
ARTICLE 2
Miscellaneous Provisions
Section 201. Recitals by Corporation. The recitals in this Supplemental
Indenture are made by the Corporation only and not by the Trustee, and all of
the provisions contained in the Original Indenture in respect of the rights,
privileges, immunities, powers and duties of the Trustee shall be applicable in
respect of the Series Notes and of this Supplemental Indenture as fully
and with like effect as if set forth herein in full.
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<PAGE>
Section 202. Ratification and Incorporation of Original Indenture. As
supplemented hereby, the Original Indenture is in all respects ratified and
confirmed, and the Original Indenture and this Supplemental Indenture shall
be read, taken and construed as one and the same instrument.
Section 203. Executed in Counterparts. This Supplemental Indenture may be
executed in several counterparts, each of which shall be deemed to be an
original, and such counterparts shall together constitute but one and the same
instrument.
Section 204. Assignment. The Corporation shall have the right at all times to
assign any of its rights or obligations under this Indenture with respect to
the Series Notes to a direct or indirect wholly-owned subsidiary of the
Corporation; provided that, in the event of any such assignment, the
Corporation shall remain primarily liable for the performance of all such
obligations. The Indenture may also be assigned by the Corporation in
connection with a transaction described in Article Eight of the Original
Indenture.
Section 205. Enforcement by Holders of Preferred Securities of Right of Holders
to Receive Principal and Interest. So long as the Series Notes are held by
the Property Trustee on behalf of the Securities Trust, a registered holder of
Preferred Securities may institute a legal proceeding directly against the
Corporation, without first instituting a legal proceeding directly against or
requesting or directing that action be taken by the Property Trustee or any
other Person, for enforcement of payment to such registered holder of principal
of or interest on Series Notes having a principal amount equal to the
aggregate stated liquidation amount of such Preferred Securities of such
registered holder on or after the due dates therefor specified or provided for
in the Series Notes. This Section 205 and Section 109 of this
Supplemental Indenture are for the benefit of the registered holders of
Preferred Securities and, prior to the dissolution of the Securities Trust, may
be enforced by such holders. A holder of a Preferred Security shall not have
the right, as such holder, to enforce any other provision of the Indenture.
IN WITNESS WHEREOF, each party hereto has caused this instrument to be signed
in its name and behalf by its duly authorized officers, all as of the day and
year first above written.
Duke Capital Corporation
By: _________________________________
Attest:
_________________________________
The Chase Manhattan Bank,
as Trustee
By: _________________________________
Attest:
_________________________________
10
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EXHIBIT A
FORM OF
SERIES % JUNIOR SUBORDINATED NOTE
DUE ,
No. CUSIP No.
THE INDEBTEDNESS EVIDENCED BY THIS SECURITY IS, TO THE EXTENT PROVIDED IN THE
INDENTURE, SUBORDINATE AND SUBJECT IN RIGHT OF PAYMENT TO THE PRIOR PAYMENT IN
FULL OF ALL SENIOR INDEBTEDNESS, AND THIS SECURITY IS ISSUED SUBJECT TO THE
PROVISIONS OF THE INDENTURE WITH RESPECT THERETO.
DUKE CAPITAL CORPORATION
SERIES % JUNIOR SUBORDINATED NOTE
DUE ,
<TABLE>
<S> <C>
Principal Amount: $
Regular Record Date: 15th calendar day prior to Interest Payment Date
Original Issue Date: ,
Stated Maturity: ,
Interest Payment Dates: March 31, June 30, September 30, December 31
Interest Rate: % per annum
Authorized Denomination: $ or any integral multiple thereof
Initial Redemption Date: ,
</TABLE>
Duke Capital Corporation, a Delaware corporation (the "Corporation," which
term includes any successor corporation under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay to
, or registered assigns, the principal sum of
DOLLARS ($ ) on the Stated Maturity shown above (or upon earlier
redemption), and to pay interest thereon from the Original Issue Date shown
above, or from the most recent Interest Payment Date to which interest has
been paid or duly provided for, quarterly in arrears on each Interest Payment
Date as specified above, commencing on , , and on the Stated
Maturity (or upon earlier redemption) at the rate per annum shown above (the
"Interest Rate") until the principal hereof is paid or made available for
payment and on any overdue principal and on any overdue installment of
interest. The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date (other than an Interest Payment Date that is the
Stated Maturity or a Redemption Date) will, as provided in such Indenture, be
paid to the Person in whose name this Series % Junior Subordinated Note Due
, (this "Security") is registered at the close of business on the
Regular Record Date as specified above next preceding such Interest Payment
Date; provided that any interest payable at Stated Maturity or on any
Redemption Date will be paid to the Person to whom principal
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is payable. Except as otherwise provided in the Indenture, any such interest
not so punctually paid or duly provided for will forthwith cease to be payable
to the Holder on such Regular Record Date and may either be paid to the Person
in whose name this Security is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange, if any, on which the Securities of this series shall be
listed, and upon such notice as may be required by any such exchange, all as
more fully provided in said Indenture.
Payments of interest on this Security will include interest accrued to but
excluding the respective Interest Payment Dates. Interest payments for this
Security shall be computed and paid 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 this
Security 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 payment in respect of any such delay), except that, if
such Business Day is in the next succeeding calendar year, payment shall be
made on the immediately preceding Business Day, in each case with the same
force and effect as if made on the date the payment was originally payable.
"Business Day" means a day other than (i) a Saturday or a Sunday, (ii) a day on
which banks in New York, New York are authorized or obligated by law or
executive order to remain closed or (iii) a day on which the Corporate Trust
Office or the principal corporate trust office of the Property Trustee is
closed for business.
The Corporation shall have the right at any time and from time to time during
the term of this Security to extend the interest payment period of such
Security for up to 20 consecutive quarters (each, an "Extension Period"), but
not beyond the Stated Maturity of this Security, during which Extension Periods
interest shall accrue on unpaid installments of interest at the Interest Rate,
compounded quarterly, to the date of payment to the extent permitted by
applicable law (such unpaid interest plus such interest thereon being called
"Deferred Interest"); provided, however, that the Corporation shall have the
right to make partial payments of interest on any Interest Payment Date during
any Extension Period. Upon the termination of each Extension Period, which
shall be an Interest Payment Date, the Corporation shall pay all Deferred
Interest on the next succeeding Interest Payment Date to the Person in whose
name this Security is registered at the close of business on the Regular Record
Date for such Interest Payment Date; provided that any Deferred Interest
payable at Stated Maturity or on any Redemption Date will be paid to the Person
to whom principal is payable. Prior to the termination of any such Extension
Period, the Corporation may further extend the interest payment period;
provided that such Extension Period together with all such previous and further
extensions thereof shall not exceed twenty (20) consecutive quarters. Upon the
termination of any such Extension Period, and the payment of all accrued and
unpaid interest (including any Additional Interest) then due, the Corporation
may select a new Extension Period, subject to the above requirements. The
Corporation shall not (i) declare or pay any dividend or distribution on, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of
its capital stock, and (ii) make any payment of interest, principal or premium,
if any, on or repay, repurchase or redeem any debt securities (including
guarantees other than the Guarantee) issued by the Corporation that rank pari
passu with or junior to this Security if the Corporation shall have given
notice of its
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election to extend an interest payment period for this Security and such
extension shall be continuing or if at such time an Event of Default with
respect to the series of which this Security is a part shall have occurred and
be continuing. The preceding sentence, however, shall not restrict (A) any of
the actions described in the preceding sentence resulting from any
reclassification of the Corporation's capital stock or the exchange or
conversion of one class or series of the Corporation's capital stock for
another class or series of the Corporation's capital stock or (B) dividends or
distributions in capital stock of the Corporation. The Corporation shall give
the Holder of this Security and the Trustee notice of its selection or
extension of an Extension Period at least one Business Day prior to the earlier
of (i) the Regular Record Date relating to the Interest Payment Date on which
the Extension Period is to commence or relating to the Interest Payment Date on
which an Extension Period that is being extended would otherwise terminate or
(ii) the date the Corporation or the Securities Trust is required to give
notice to the New York Stock Exchange or other applicable self-regulatory
organization of the record date or the date such distributions are payable.
The Corporation also shall be obligated to pay when due and without extension
all additional amounts as may be required so that the net amount received and
retained by the Holder of this Security (if the Holder is the Securities Trust)
after paying taxes, duties, assessments or governmental charges of whatever
nature (other than withholding taxes) imposed by the United States or any other
taxing authority will not be less than the amounts such Holder would have
received had no such taxes, duties, assessments, or other governmental charges
been imposed.
Payment of the principal of and interest (including Additional Interest, if
any) due at the Stated Maturity or earlier redemption of this Security shall be
made upon surrender of this Security, at the Corporate Trust Office of the
Trustee, in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts.
Payment of interest (including interest on an Interest Payment Date) will be
made, subject to such surrender where applicable, at the option of the
Corporation, (i) by check mailed to the address of the Person entitled thereto
as such address shall appear in the Security Register or (ii) by wire transfer
at such place and to such account at a banking institution in the United States
as may be designated in writing to the Trustee at least sixteen (16) days prior
to the date for payment by the Person entitled thereto.
The indebtedness evidenced by this Security is, to the extent and in the manner
set forth in the Indenture, subordinate in right of payment to the prior
payment in full of all Senior Indebtedness (as defined in the Indenture), and
this Security is issued subject to the provisions of the Indenture with respect
thereto. Each Holder of this Security, by accepting the same, (a) agrees to and
shall be bound by such provisions, (b) authorizes and directs the Trustee on
his behalf to take such action as may be necessary or appropriate to effectuate
the subordination so provided and (c) appoints the Trustee his attorney-in-fact
for any and all such purposes. Each Holder hereof, by his acceptance hereof,
waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Indebtedness whether now
outstanding or hereafter incurred and waives reliance by each such holder upon
said provisions.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS SECURITY SET FORTH
ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE
SAME EFFECT AS IF SET FORTH AT THIS PLACE.
A-3
<PAGE>
Unless the certificate of authentication hereon has been executed by the
Trustee by manual signature, this Security shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Corporation has caused this instrument to be duly
executed under its corporate seal.
Dated:
Duke Capital Corporation
By: _________________________________
Attest:
_________________________________
A-4
<PAGE>
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to in
the within-mentioned Indenture.
The Chase Manhattan Bank,
as Trustee
By: _________________________________
Authorized Officer
A-5
<PAGE>
(REVERSE SIDE OF SECURITY)
This Security is one of a duly authorized issue of Securities of the
Corporation (the "Securities"), issued and issuable in one or more series under
a Subordinated Indenture, dated as of April 1, 1998, as supplemented (the
"Indenture"), between the Corporation and The Chase Manhattan Bank, as Trustee
(the "Trustee," which term includes any successor trustee under the Indenture),
to which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights, limitation of rights, duties and
immunities thereunder of the Corporation, the Trustee and the Holders of the
Securities issued thereunder and of the terms upon which said Securities are,
and are to be, authenticated and delivered. This Security is one of the series
designated on the face hereof as Series % Junior Subordinated Notes due
, (the "Series Notes") in the aggregate principal amount of up to
$ . Capitalized terms used herein for which no definition is provided
herein shall have the meanings set forth in the Indenture.
The Corporation shall have the right, subject to the terms and conditions of
the Indenture, to redeem this Security at any time on or after , at
the option of the Corporation, without premium or penalty, in whole or in part,
at a Redemption Price equal to 100% of the principal amount to be redeemed plus
accrued but unpaid interest (including any Additional Interest) to the
Redemption Date. Upon the occurrence of a Special Event (as defined below), the
Corporation may, within 90 days following the occurrence thereof and subject to
the terms and conditions of the Indenture, redeem this Security without premium
or penalty, in whole, at a Redemption Price equal to 100% of the principal
amount thereof plus accrued but unpaid interest (including any Additional
Interest) to the Redemption Date. A Special Event may be a Tax Event or an
Investment Company Act Event. "Tax Event" means that the Administrative
Trustees and the Corporation shall have received an Opinion of Counsel
experienced in such matters to the effect that, as a result of (a) any
amendment to, or change (including any announced prospective change) in, laws
(or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein or (b) any amendment to, or
change in, an interpretation or application of such laws or regulations, there
is more than an insubstantial risk that (i) the Securities Trust would be
subject to United States federal income tax with respect to income accrued or
received on the Series Notes, (ii) interest payable on the Series Notes
would not be deductible by the Corporation for United States federal income tax
purposes, or (iii) the Securities Trust would be subject to more than a de
minimis amount of other taxes, duties or other governmental charges, which
change or amendment becomes effective on or after the Original Issue Date.
"Investment Company Act Event" means that the Administrative Trustees and the
Corporation shall have received 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 written 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 Securities 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 Original Issue Date.
In the event of redemption of this Security in part only, a new Security or
Securities of this series for the unredeemed portion hereof will be issued in
the name of the Holder hereof upon the surrender hereof. The Securities of this
series will not have a sinking fund.
A-6
<PAGE>
If an Event of Default with respect to the Securities of this series shall
occur and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner, with the effect and subject to the
conditions provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Corporation and the rights of the Holders of the Securities of all series
affected under the Indenture at any time by the Corporation and the Trustee
with the consent of the Holders of not less than a majority in principal amount
of the Outstanding Securities of all series affected thereby (voting as one
class). The Indenture contains provisions permitting the Holders of not less
than a majority in principal amount of the Outstanding Securities of all series
with respect to which a default under the Indenture shall have occurred and be
continuing (voting as one class), on behalf of the Holders of the Securities of
all such series, to waive, with certain exceptions, such default under the
Indenture and its consequences. The Indenture also permits the Holders of not
less than a majority in principal amount of the Securities of each series at
the time Outstanding, on behalf of the Holders of all Securities of such
series, to waive compliance by the Corporation with certain provisions of the
Indenture affecting such series. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this Security or of
the Indenture shall alter or impair the obligation of the Corporation, which is
absolute and unconditional, to pay the principal of and interest on this
Security at the times, place and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Security Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Corporation for such purpose, duly endorsed by, or accompanied by
a written instrument of transfer in form satisfactory to the Corporation and
the Security Registrar and duly executed by, the Holder hereof or his attorney
duly authorized in writing, and thereupon one or more new Securities of this
series, of authorized denominations and of like tenor and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees. No service charge shall be made for any such registration of
transfer or exchange, but the Corporation may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
As provided in and subject to the provisions of the Indenture, the Holder of
this Security shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than a majority in principal
amount of the Securities of this series at the time Outstanding shall have made
written request to the Trustee to institute proceedings in respect of such
Event of Default as Trustee and offered the Trustee reasonable indemnity, and
the Trustee shall not have received from the Holders of a majority in principal
amount of Securities of this series at the time Outstanding a direction
inconsistent with such request and shall have failed to
A-7
<PAGE>
institute any such proceeding for 60 days after receipt of such notice, request
and offer of indemnity. The foregoing shall not apply to any suit instituted by
the Holder of this Security for the enforcement of any payment of principal
hereof or any interest hereon on or after the respective due dates expressed
herein.
The Indenture contains provisions for defeasance at any time of the entire
indebtedness of the Securities of this series upon compliance with certain
conditions set forth in the Indenture.
Prior to due presentment of this Security for registration of transfer, the
Corporation, the Trustee and any agent of the Corporation or the Trustee may
treat the Person in whose name this Security is registered as the owner hereof
for all purposes, whether or not this Security be overdue, and neither the
Corporation, the Trustee nor any such agent shall be affected by notice to the
contrary.
The Securities of this series are issuable only in registered form without
coupons in denominations of $ and any integral multiple thereof. As provided
in the Indenture and subject to the limitations therein set forth, Securities
of this series are exchangeable for a like aggregate principal amount of
Securities of this series of a different authorized denomination, as requested
by the Holder surrendering the same upon surrender of the Security or
Securities to be exchanged at the office or agency of the Corporation.
This Security shall be governed by, and construed in accordance with, the
internal laws of the State of New York.
A-8
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common UNIF GIFT MIN ACT -- Custodian
----- --------
(Cust) (Minor)
TEN ENT -- as tenants by the entireties
under Uniform Gifts to Minors
JT TEN -- as joint tenants with Act __________________________
rights of survivorship and (State)
not as tenants in common
ADDITIONAL ABBREVIATIONS MAY ALSO BE USED THOUGH NOT ON THE ABOVE LIST.
FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto
(please insert Social Security or other identifying number of assignee)
- --------------------------------------------------------------------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF
ASSIGNEE
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
agent to transfer said Security on the books of the Corporation, with full
power of substitution in the premises.
Dated: _____________________________ --------------------------------------
--------------------------------------
NOTICE: The signature to this
assignment must correspond with the
name as written upon the face of the
within instrument in every particular
without alteration or enlargement, or
any change whatever.
A-9
<PAGE>
EXHIBIT B
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to in
the within-mentioned Indenture.
The Chase Manhattan Bank,
as Trustee
By: _________________________________
Authorized Officer
B-1
<PAGE>
Exhibit 4.5-A
CERTIFICATE OF TRUST
OF
DUKE CAPITAL FINANCING TRUST III
THIS Certificate of Trust of Duke Capital Financing Trust III (the
"Trust"), dated as of January 29, 1998, is being duly executed and filed by
the undersigned, as trustee, to form a business trust under the Delaware
Business Trust Act (12 Del. C. (S) 3801, et seq.).
------- -- ---
1. Name. The name of the business trust formed hereby is Duke
----
Capital Financing Trust III.
2. Delaware Trustee. The name and business address of the trustee of
----------------
the Trust with a principal place of business in the State of Delaware are Chase
Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801.
3. Effective Date. This Certificate of Trust shall be effective upon
--------------
filing.
IN WITNESS WHEREOF, the undersigned, being the sole trustee of the
Trust, has executed this Certificate of Trust as of the date first-above
written.
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but
solely as trustee of the Trust
By: /s/ Denis Kelly
----------------------------
Name: Denis Kelly
Title: Trust Officer
<PAGE>
Exhibit 4.5-B
CERTIFICATE OF TRUST
OF
DUKE CAPITAL FINANCING TRUST IV
THIS Certificate of Trust of Duke Capital Financing Trust IV (the
"Trust"), dated as of September 25, 1998, is being duly executed and filed by
the undersigned, as trustee, to form a business trust under the Delaware
Business Trust Act (12 Del. C. (S) 3801, et seq.).
------- -- ---
1. Name. The name of the business trust formed hereby is Duke
----
Capital Financing Trust IV.
2. Delaware Trustee. The name and business address of the trustee of
----------------
the Trust with a principal place of business in the State of Delaware are Chase
Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801.
3. Effective Date. This Certificate of Trust shall be effective upon
--------------
filing.
IN WITNESS WHEREOF, the undersigned, being the sole trustee of the
Trust, has executed this Certificate of Trust as of the date first-above
written.
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but
solely as trustee of the Trust
By: /s/ Denis Kelly
----------------------------
Name: Denis Kelly
Title: Trust Officer
<PAGE>
Exhibit 4.5-C
CERTIFICATE OF TRUST
OF
DUKE CAPITAL FINANCING TRUST V
THIS Certificate of Trust of Duke Capital Financing Trust V (the
"Trust"), dated as of September 25, 1998, is being duly executed and filed by
the undersigned, as trustee, to form a business trust under the Delaware
Business Trust Act (12 Del. C. (S) 3801, et seq.).
------- -- ---
1. Name. The name of the business trust formed hereby is Duke
----
Capital Financing Trust V.
2. Delaware Trustee. The name and business address of the trustee of
----------------
the Trust with a principal place of business in the State of Delaware are Chase
Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801.
3. Effective Date. This Certificate of Trust shall be effective upon
--------------
filing.
IN WITNESS WHEREOF, the undersigned, being the sole trustee of the
Trust, has executed this Certificate of Trust as of the date first-above
written.
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but
solely as trustee of the Trust
By: /s/ Denis Kelly
----------------------------
Name: Denis Kelly
Title: Trust Officer
<PAGE>
Exhibit 4.6-A
TRUST AGREEMENT
OF
DUKE CAPITAL FINANCING TRUST III
THIS TRUST AGREEMENT is made as of January 29, 1998 (this "Declaration"), by
and among Duke Capital Corporation, a Delaware corporation, as depositor (the
"Depositor"), and Chase Manhattan Bank Delaware, a Delaware banking corporation,
as trustee (the "Trustee"). The Depositor and the Trustee hereby agree as
follows:
1. The trust created hereby shall be known as "Duke Capital Financing Trust
III" (the "Trust"), in which name the Trustee or the Depositor, to the extent
provided herein, may conduct the business of the Trust, make and execute
contracts, and sue and be sued.
2. The Depositor hereby assigns, transfers, conveys and sets over to the Trust
the sum of $10. Such amount shall constitute the initial trust estate. It is the
intention of the parties hereto that the Trust created hereby constitute a
business trust under Chapter 38 of Title 12 of the Delaware Code, 12 Del. C.
------
(S)3801, et seq. (the "Business Trust Act"), and that this document constitute
------
the governing instrument of the Trust. The Trustee is hereby authorized and
directed to execute and file a certificate of trust with the Delaware Secretary
of State in such form as the Trustee may approve.
3. The Depositor and the Trustee will enter into an amended and restated Trust
Agreement or Declaration satisfactory to each such party to provide for the
contemplated operation of the Trust created hereby and the issuance of the
Preferred Securities and Common Securities referred to therein. Prior to the
execution and delivery of such amended and restated Trust Agreement or
Declaration, the Trustee shall not have any duty or obligation hereunder or with
respect of the trust estate, except as otherwise required by applicable law or
as may be necessary to obtain prior to such execution and delivery any licenses,
consents or approvals required by applicable law or otherwise.
Notwithstanding the foregoing, the Trustee may take all actions deemed proper as
are necessary to effect the transactions contemplated herein.
4. The Depositor is hereby authorized, in its sole discretion, (i) to file
with the Securities and Exchange Commission (the "Commission") and to execute,
in the case of the 1933 Act Registration Statement and 1934 Act Registration
Statement (as herein defined), on behalf of the Trust, (a) the 1933 Act
Registration Statement, including pre-effective or post-effective amendments to
such Registration Statement, relating to the registration under the Securities
Act of 1933, as amended (the "1933 Act"), of the Preferred Securities of the
Trust, (b) any preliminary prospectus or prospectus or supplement thereto
relating to the Preferred Securities required to be filed under the 1933 Act,
and (c) if required, a Registraton Statement on Form 8-A or other appropriate
form (the "1934 Act Registration Statement") (including all pre-effective and
post-effective amendments thereto) relating to the registration of the Preferred
Securities of the Trust under the Securities Exchange Act of 1934, as amended;
(ii) to file with the New York Stock Exchange or any other exchange
(collectively, the "Exchange") and execute on behalf of the Trust a listing
application and all other applications, statements, certificates, agreements and
other instruments as shall be necessary or desirable to cause the Preferred
Securities to be listed
<PAGE>
on the Exchange; (iii) to file and execute on behalf of the Trust such
applications, reports, surety bonds, irrevocable consents, appointments of
attorney for service of process and other papers and documents as shall be
necessary or desirable to register the Preferred Securities under the securities
or "Blue Sky" laws of such jurisdictions as the Depositor, on behalf of the
Trust, may deem necessary or desirable; (iv) to execute, deliver and perform on
behalf of the Trust, an underwriting agreement with the Depositor and the
underwriter or underwriters of the Preferred Securities of the Trust; (v) to
execute, deliver and perform a depository agreement with the initial clearing
agency, relating to the Preferred Securities; and (vi) to apply for and obtain a
tax identification number for the Trust.
In the event that any filing referred to in this Section 4 is required by the
rules and regulations of the Commission, PORTAL or state securities or Blue Sky
laws to be executed on behalf of the Trust by the Trustee, the Trustee, in its
capacity as trustee of the Trust, is hereby authorized and directed to join in
any such filing and to execute on behalf of the Trust any and all of the
foregoing, it being understood that Chase Manhattan Bank Delaware, in its
capacity as trustee of the Trust, shall not be required to join in any such
filing or execute on behalf of the Trust any such document unless required by
the rules and regulations of the Commission, PORTAL or state securities or Blue
Sky laws. In connection with all of the foregoing, the Depositor hereby
constitutes and appoints Robert T. Lucas III, as its true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution
for the Depositor or in the Depositor's name, place and stead, in any and all
capacities, to sign any and all amendments (including all pre-effective and
post-effective amendments) to the 1933 Act Registration Statement and any 1934
Act Registration Statement and to file the same, with all exhibits thereto, and
any other documents in connection therewith, with the Commission, granting unto
said attorney-in-fact and agent full power and authority to do and perform each
and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as the Depositor might or could
do in person, hereby ratifying and confirming all that said attorney-in-fact and
agent or his respective substitute or substitutes, shall do or cause to be done
by virtue hereof.
5. This Declaration may be executed in one or more counterparts.
6. The number of trustees of the Trust initially shall be one and thereafter
the number of trustees of the Trust shall be such number as shall be fixed from
time to time by a written instrument signed by the Depositor which may increase
or decrease the number of trustees of the Trust; provided, however, that to the
extent required by the Business Trust Act, one trustee of the Trust shall either
be a natural person who is a resident of the State of Delaware or, if not a
natural person, any entity which has its principal place of business in the
State of Delaware. Subject to the foregoing, the Depositor is entitled to
appoint or remove without cause any trustee of the Trust at any time. Any
trustee of the Trust may resign upon thirty days' prior notice to the Depositor.
7. This Declaration shall be governed by, and construed in accordance with,
the laws of the State of Delaware (with regard to conflict of laws principles).
-2-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Declaration to be duly
executed as of the day and year first above written.
DUKE CAPITAL CORPORATION, as Depositor
By: /s/ Robert T. Lucas III
---------------------------------
Name: Robert T. Lucas III
Title: Assistant Secretary
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but
solely as trustee of the Trust
By: /s/ Denis Kelly
---------------------------------
Name: Denis Kelly
Title: Trust Officer
-3-
<PAGE>
Exhibit 4.6-B
TRUST AGREEMENT
OF
DUKE CAPITAL FINANCING TRUST IV
THIS TRUST AGREEMENT is made as of September 25, 1998 (this "Declaration"), by
and among Duke Capital Corporation, a Delaware corporation, as depositor (the
"Depositor"), and Chase Manhattan Bank Delaware, a Delaware banking corporation,
as trustee (the "Trustee"). The Depositor and the Trustee hereby agree as
follows:
1. The trust created hereby shall be known as "Duke Capital Financing Trust
IV" (the "Trust"), in which name the Trustee or the Depositor, to the extent
provided herein, may conduct the business of the Trust, make and execute
contracts, and sue and be sued.
2. The Depositor hereby assigns, transfers, conveys and sets over to the Trust
the sum of $10. Such amount shall constitute the initial trust estate. It is the
intention of the parties hereto that the Trust created hereby constitute a
business trust under Chapter 38 of Title 12 of the Delaware Code, 12 Del. C.
------
(S)3801, et seq. (the "Business Trust Act"), and that this document constitute
------
the governing instrument of the Trust. The Trustee is hereby authorized and
directed to execute and file a certificate of trust with the Delaware Secretary
of State in such form as the Trustee may approve.
3. The Depositor and the Trustee will enter into an amended and restated Trust
Agreement or Declaration satisfactory to each such party to provide for the
contemplated operation of the Trust created hereby and the issuance of the
Preferred Securities and Common Securities referred to therein. Prior to the
execution and delivery of such amended and restated Trust Agreement or
Declaration, the Trustee shall not have any duty or obligation hereunder or with
respect of the trust estate, except as otherwise required by applicable law or
as may be necessary to obtain prior to such execution and delivery any licenses,
consents or approvals required by applicable law or otherwise.
Notwithstanding the foregoing, the Trustee may take all actions deemed proper as
are necessary to effect the transactions contemplated herein.
4. The Depositor is hereby authorized, in its sole discretion, (i) to file
with the Securities and Exchange Commission (the "Commission") and to execute,
in the case of the 1933 Act Registration Statement and 1934 Act Registration
Statement (as herein defined), on behalf of the Trust, (a) the 1933 Act
Registration Statement, including pre-effective or post-effective amendments to
such Registration Statement, relating to the registration under the Securities
Act of 1933, as amended (the "1933 Act"), of the Preferred Securities of the
Trust, (b) any preliminary prospectus or prospectus or supplement thereto
relating to the Preferred Securities required to be filed under the 1933 Act,
and (c) if required, a Registraton Statement on Form 8-A or other appropriate
form (the "1934 Act Registration Statement") (including all pre-effective and
post-effective amendments thereto) relating to the registration of the Preferred
Securities of the Trust under the Securities Exchange Act of 1934, as amended;
(ii) to file with the New York Stock Exchange or any other exchange
(collectively, the "Exchange") and execute on behalf of the Trust a listing
application and all other applications, statements, certificates, agreements and
other instruments as shall be necessary or desirable to cause the Preferred
Securities to be listed
<PAGE>
on the Exchange; (iii) to file and execute on behalf of the Trust such
applications, reports, surety bonds, irrevocable consents, appointments of
attorney for service of process and other papers and documents as shall be
necessary or desirable to register the Preferred Securities under the securities
or "Blue Sky" laws of such jurisdictions as the Depositor, on behalf of the
Trust, may deem necessary or desirable; (iv) to execute, deliver and perform on
behalf of the Trust, an underwriting agreement with the Depositor and the
underwriter or underwriters of the Preferred Securities of the Trust; (v) to
execute, deliver and perform a depository agreement with the initial clearing
agency, relating to the Preferred Securities; and (vi) to apply for and obtain a
tax identification number for the Trust.
In the event that any filing referred to in this Section 4 is required by the
rules and regulations of the Commission, PORTAL or state securities or Blue Sky
laws to be executed on behalf of the Trust by the Trustee, the Trustee, in its
capacity as trustee of the Trust, is hereby authorized and directed to join in
any such filing and to execute on behalf of the Trust any and all of the
foregoing, it being understood that Chase Manhattan Bank Delaware, in its
capacity as trustee of the Trust, shall not be required to join in any such
filing or execute on behalf of the Trust any such document unless required by
the rules and regulations of the Commission, PORTAL or state securities or Blue
Sky laws. In connection with all of the foregoing, the Depositor hereby
constitutes and appoints Robert T. Lucas III, as its true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution
for the Depositor or in the Depositor's name, place and stead, in any and all
capacities, to sign any and all amendments (including all pre-effective and
post-effective amendments) to the 1933 Act Registration Statement and any 1934
Act Registration Statement and to file the same, with all exhibits thereto, and
any other documents in connection therewith, with the Commission, granting unto
said attorney-in-fact and agent full power and authority to do and perform each
and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as the Depositor might or could
do in person, hereby ratifying and confirming all that said attorney-in-fact and
agent or his respective substitute or substitutes, shall do or cause to be done
by virtue hereof.
5. This Declaration may be executed in one or more counterparts.
6. The number of trustees of the Trust initially shall be one and thereafter
the number of trustees of the Trust shall be such number as shall be fixed from
time to time by a written instrument signed by the Depositor which may increase
or decrease the number of trustees of the Trust; provided, however, that to the
extent required by the Business Trust Act, one trustee of the Trust shall either
be a natural person who is a resident of the State of Delaware or, if not a
natural person, any entity which has its principal place of business in the
State of Delaware. Subject to the foregoing, the Depositor is entitled to
appoint or remove without cause any trustee of the Trust at any time. Any
trustee of the Trust may resign upon thirty days' prior notice to the Depositor.
7. This Declaration shall be governed by, and construed in accordance with,
the laws of the State of Delaware (with regard to conflict of laws principles).
-2-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Declaration to be duly
executed as of the day and year first above written.
DUKE CAPITAL CORPORATION, as Depositor
By: /s/ David L. Hauser
---------------------------------
Name: David L. Hauser
Title: Vice President and Treasurer
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but
solely as trustee of the Trust
By: /s/ Denis Kelly
---------------------------------
Name: Denis Kelly
Title: Trust Officer
-3-
<PAGE>
Exhibit 4.6-C
TRUST AGREEMENT
OF
DUKE CAPITAL FINANCING TRUST V
THIS TRUST AGREEMENT is made as of September 25, 1998 (this "Declaration"), by
and among Duke Capital Corporation, a Delaware corporation, as depositor (the
"Depositor"), and Chase Manhattan Bank Delaware, a Delaware banking corporation,
as trustee (the "Trustee"). The Depositor and the Trustee hereby agree as
follows:
1. The trust created hereby shall be known as "Duke Capital Financing Trust V"
(the "Trust"), in which name the Trustee or the Depositor, to the extent
provided herein, may conduct the business of the Trust, make and execute
contracts, and sue and be sued.
2. The Depositor hereby assigns, transfers, conveys and sets over to the Trust
the sum of $10. Such amount shall constitute the initial trust estate. It is the
intention of the parties hereto that the Trust created hereby constitute a
business trust under Chapter 38 of Title 12 of the Delaware Code, 12 Del. C.
------
(S)3801, et seq. (the "Business Trust Act"), and that this document constitute
------
the governing instrument of the Trust. The Trustee is hereby authorized and
directed to execute and file a certificate of trust with the Delaware Secretary
of State in such form as the Trustee may approve.
3. The Depositor and the Trustee will enter into an amended and restated Trust
Agreement or Declaration satisfactory to each such party to provide for the
contemplated operation of the Trust created hereby and the issuance of the
Preferred Securities and Common Securities referred to therein. Prior to the
execution and delivery of such amended and restated Trust Agreement or
Declaration, the Trustee shall not have any duty or obligation hereunder or with
respect of the trust estate, except as otherwise required by applicable law or
as may be necessary to obtain prior to such execution and delivery any licenses,
consents or approvals required by applicable law or otherwise.
Notwithstanding the foregoing, the Trustee may take all actions deemed proper as
are necessary to effect the transactions contemplated herein.
4. The Depositor is hereby authorized, in its sole discretion, (i) to file
with the Securities and Exchange Commission (the "Commission") and to execute,
in the case of the 1933 Act Registration Statement and 1934 Act Registration
Statement (as herein defined), on behalf of the Trust, (a) the 1933 Act
Registration Statement, including pre-effective or post-effective amendments to
such Registration Statement, relating to the registration under the Securities
Act of 1933, as amended (the "1933 Act"), of the Preferred Securities of the
Trust, (b) any preliminary prospectus or prospectus or supplement thereto
relating to the Preferred Securities required to be filed under the 1933 Act,
and (c) if required, a Registraton Statement on Form 8-A or other appropriate
form (the "1934 Act Registration Statement") (including all pre-effective and
post-effective amendments thereto) relating to the registration of the Preferred
Securities of the Trust under the Securities Exchange Act of 1934, as amended;
(ii) to file with the New York Stock Exchange or any other exchange
(collectively, the "Exchange") and execute on behalf of the Trust a listing
application and all other applications, statements, certificates, agreements and
other instruments as shall be necessary or desirable to cause the Preferred
Securities to be listed
<PAGE>
on the Exchange; (iii) to file and execute on behalf of the Trust such
applications, reports, surety bonds, irrevocable consents, appointments of
attorney for service of process and other papers and documents as shall be
necessary or desirable to register the Preferred Securities under the securities
or "Blue Sky" laws of such jurisdictions as the Depositor, on behalf of the
Trust, may deem necessary or desirable; (iv) to execute, deliver and perform on
behalf of the Trust, an underwriting agreement with the Depositor and the
underwriter or underwriters of the Preferred Securities of the Trust; (v) to
execute, deliver and perform a depository agreement with the initial clearing
agency, relating to the Preferred Securities; and (vi) to apply for and obtain a
tax identification number for the Trust.
In the event that any filing referred to in this Section 4 is required by the
rules and regulations of the Commission, PORTAL or state securities or Blue Sky
laws to be executed on behalf of the Trust by the Trustee, the Trustee, in its
capacity as trustee of the Trust, is hereby authorized and directed to join in
any such filing and to execute on behalf of the Trust any and all of the
foregoing, it being understood that Chase Manhattan Bank Delaware, in its
capacity as trustee of the Trust, shall not be required to join in any such
filing or execute on behalf of the Trust any such document unless required by
the rules and regulations of the Commission, PORTAL or state securities or Blue
Sky laws. In connection with all of the foregoing, the Depositor hereby
constitutes and appoints Robert T. Lucas III, as its true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution
for the Depositor or in the Depositor's name, place and stead, in any and all
capacities, to sign any and all amendments (including all pre-effective and
post-effective amendments) to the 1933 Act Registration Statement and any 1934
Act Registration Statement and to file the same, with all exhibits thereto, and
any other documents in connection therewith, with the Commission, granting unto
said attorney-in-fact and agent full power and authority to do and perform each
and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as the Depositor might or could
do in person, hereby ratifying and confirming all that said attorney-in-fact and
agent or his respective substitute or substitutes, shall do or cause to be done
by virtue hereof.
5. This Declaration may be executed in one or more counterparts.
6. The number of trustees of the Trust initially shall be one and thereafter
the number of trustees of the Trust shall be such number as shall be fixed from
time to time by a written instrument signed by the Depositor which may increase
or decrease the number of trustees of the Trust; provided, however, that to the
extent required by the Business Trust Act, one trustee of the Trust shall either
be a natural person who is a resident of the State of Delaware or, if not a
natural person, any entity which has its principal place of business in the
State of Delaware. Subject to the foregoing, the Depositor is entitled to
appoint or remove without cause any trustee of the Trust at any time. Any
trustee of the Trust may resign upon thirty days' prior notice to the Depositor.
7. This Declaration shall be governed by, and construed in accordance with,
the laws of the State of Delaware (with regard to conflict of laws principles).
-2-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Declaration to be duly
executed as of the day and year first above written.
DUKE CAPITAL CORPORATION, as Depositor
By: /s/ David L. Hauser
---------------------------------
Name: David L. Hauser
Title: Vice President and Treasurer
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but
solely as trustee of the Trust
By: /s/ Denis Kelly
---------------------------------
Name: Denis Kelly
Title: Trust Officer
-3-
<PAGE>
EXHIBIT 4.7
DUKE CAPITAL FINANCING TRUST [ ]
AMENDED AND RESTATED
TRUST AGREEMENT
AMONG
DUKE CAPITAL CORPORATION, AS DEPOSITOR,
THE CHASE MANHATTAN BANK, AS PROPERTY TRUSTEE
CHASE MANHATTAN BANK DELAWARE, AS DELAWARE TRUSTEE
AND
ROBERT T. LUCAS III AND S.L. LOVE,
AS ADMINISTRATIVE TRUSTEES
DATED AS OF ,
<PAGE>
DUKE CAPITAL FINANCING TRUST [ ]
CERTAIN SECTIONS OF THIS TRUST AGREEMENT RELATING TO
SECTIONS 310 THROUGH 318 OF THE
TRUST INDENTURE ACT OF 1939:
<TABLE>
<CAPTION>
TRUST INDENTURE TRUST AGREEMENT
ACT SECTION SECTION
--------------- ---------------
<C> <S> <C>
Section 310 (a)(1)........................................... 8.07
(a)(2)........................................... 8.07
(a)(3)........................................... 8.09
(a)(4)........................................... Not Applicable
(b).............................................. 8.08
Section 311 (a).............................................. 8.13
(b).............................................. 8.13
Section 312 (a).............................................. 5.07
(b).............................................. 5.07
(c).............................................. 5.07
Section 313 (a).............................................. 8.14(a)
(a)(4)........................................... 8.14(b)
(b).............................................. 8.14(b)
(c).............................................. 8.14(a)
(d).............................................. 8.14(a), 8.14(b)
Section 314 (a).............................................. 8.15
(b).............................................. Not Applicable
(c)(1)........................................... 8.15, 8.16
(c)(2)........................................... 8.16
(c)(3)........................................... 8.16
(d).............................................. Not Applicable
(e).............................................. 8.16
Section 315 (a).............................................. 8.01
(b).............................................. 8.02, 8.14(b)
(c).............................................. 8.01(a)
(d).............................................. 8.01, 8.03
(e).............................................. Not Applicable
Section 316 (a).............................................. Not Applicable
(a)(l)(A)........................................ 8.19
(a)(1)(B)........................................ 8.19
(a)(2)........................................... Not Applicable
(b).............................................. Not Applicable
(c).............................................. Not Applicable
Section 317 (a)(1)........................................... Not Applicable
(a)(2)........................................... Not Applicable
(b).............................................. 5.09
Section 318 (a).............................................. 10.10
</TABLE>
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Note: This Cross-Reference Table does not constitute part of the Trust
Agreement and shall not affect the interpretation of any of its terms and
provisions.
<PAGE>
TABLE OF CONTENTS
ARTICLE I
Defined Terms
<TABLE>
<CAPTION>
PAGE
----
<C> <S> <C>
Section 1.01 Definitions............................................... 1
ARTICLE II
Establishment of the Trust
Section 2.01 Name...................................................... 9
Section 2.02 Offices of the Trustees; Principal Place of Business...... 9
Section 2.03 Initial Contribution of Trust Property; Organizational
Expenses.................................................. 9
Section 2.04 Issuance of the Preferred Securities...................... 9
Section 2.05 Subscription and Purchase of Junior Subordinated Notes;
Section 2.06 Issuance of the Common Securities........................ 9
Declaration of Trust...................................... 10
Section 2.07 Authorization to Enter into Certain Transactions.......... 10
Section 2.08 Assets of Trust........................................... 14
Section 2.09 Title to Trust Property................................... 14
Section 2.10 Mergers and Consolidations of the Trust................... 14
ARTICLE III
Payment Account
Section 3.01 Payment Account........................................... 15
ARTICLE IV
Distributions; Redemption
Section 4.01 Distributions............................................. 16
Section 4.02 Redemption................................................ 17
Section 4.03 Subordination of Common Securities........................ 18
Section 4.04 Payment Procedures........................................ 19
Section 4.05 Tax Returns and Reports................................... 19
ARTICLE V
Trust Securities Certificates
Section 5.01 Initial Ownership......................................... 19
Section 5.02 The Trust Securities Certificates......................... 19
Section 5.03 Authentication of Trust Securities Certificates........... 20
Section 5.04 Registration of Transfer and Exchange of Preferred
Securities Certificates................................... 20
Section 5.05 Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates.............................................. 21
Section 5.06 Persons Deemed Securityholders............................ 21
Section 5.07 Access to List of Securityholders' Names and Addresses.... 21
Section 5.08 Maintenance of Office or Agency........................... 22
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<C> <S> <C>
Section 5.09 Appointment of Paying Agent............................... 22
Section 5.10 Ownership of Common Securities by Depositor............... 22
Section 5.11 Book-Entry Preferred Securities Certificates; Common
Securities Certificate.................................... 23
Section 5.12 Notices to Clearing Agency................................ 23
Section 5.13 Definitive Preferred Securities Certificates.............. 24
Section 5.14 Rights of Securityholders................................. 24
ARTICLE VI
Acts of Securityholders; Meetings; Voting
Section 6.01 Limitations on Voting Rights.............................. 24
Section 6.02 Notice of Meetings........................................ 25
Section 6.03 Meetings of Preferred Securityholders..................... 25
Section 6.04 Voting Rights............................................. 26
Section 6.05 Proxies, etc. ............................................ 26
Section 6.06 Securityholder Action by Written Consent.................. 26
Section 6.07 Record Date for Voting and Other Purposes................. 26
Section 6.08 Acts of Securityholders................................... 26
Section 6.09 Inspection of Records..................................... 27
ARTICLE VII
Representations and Warranties of the Property Trustee and Delaware Trustee
Section 7.01 Representations and Warranties of the Property Trustee and
Delaware Trustee.......................................... 27
Section 7.02 Representations and Warranties of Depositor............... 28
ARTICLE VIII
The Trustees
Section 8.01 Certain Duties and Responsibilities....................... 29
Section 8.02 Notice of Defaults........................................ 29
Section 8.03 Certain Rights of Property Trustee........................ 29
Section 8.04 Not Responsible for Recitals or Issuance of Securities.... 30
Section 8.05 May Hold Securities....................................... 30
Section 8.06 Compensation; Fees; Indemnity............................. 31
Section 8.07 Trustees Required; Eligibility............................ 31
Section 8.08 Conflicting Interests..................................... 32
Section 8.09 Co-Property Trustees and Separate Trustee................. 32
Section 8.10 Resignation and Removal; Appointment of Successor......... 33
Section 8.11 Acceptance of Appointment by Successor.................... 34
Section 8.12 Merger, Conversion, Consolidation or Succession to
Business.................................................. 35
Section 8.13 Preferential Collection of Claims Against Depositor or
Trust..................................................... 35
Section 8.14 Reports by the Property Trustee........................... 35
Section 8.15 Reports to the Property Trustee........................... 36
Section 8.16 Evidence of Compliance with Conditions Precedent.......... 36
Section 8.17 Number of Trustees........................................ 36
Section 8.18 Delegation of Power....................................... 36
Section 8.19 Enforcement of Rights of Property Trustee by
Securityholders........................................... 37
Section 8.20 Delaware Trustee.......................................... 37
</TABLE>
ii
<PAGE>
ARTICLE IX
Termination and Liquidation
<TABLE>
<CAPTION>
PAGE
----
<C> <S> <C>
Section 9.01 Termination Upon Expiration Date........................... 38
Section 9.02 Early Termination.......................................... 38
Section 9.03 Termination................................................ 38
Section 9.04 Liquidation................................................ 38
Section 9.05 Bankruptcy................................................. 39
ARTICLE X
Miscellaneous Provisions
Section 10.01 Guarantee by the Depositor................................. 40
Section 10.02 Limitation of Rights of Securityholders.................... 40
Section 10.03 Amendment.................................................. 40
Section 10.04 Separability............................................... 41
Section 10.05 Governing Law.............................................. 41
Section 10.06 Notice of Deferral of Distribution......................... 41
Section 10.07 Headings................................................... 42
Section 10.08 Notice and Demand.......................................... 42
Section 10.09 Agreement Not to Petition.................................. 42
Section 10.10 Conflict with Trust Indenture Act.......................... 43
Section 10.11 Successors................................................. 43
EXHIBIT A Certificate of Trust
EXHIBIT B (Reserved)
EXHIBIT C Form of Common Securities Certificate
EXHIBIT D Form of Expense Agreement
EXHIBIT E Form of Preferred Securities Certificate
</TABLE>
iii
<PAGE>
AMENDED AND RESTATED TRUST AGREEMENT
THIS AMENDED AND RESTATED TRUST AGREEMENT is made as of , , by and
among (i) Duke Capital Corporation, a Delaware corporation (the "Depositor" or
the "Corporation"), (ii) The Chase Manhattan Bank, a banking corporation duly
organized and existing under the laws of the State of New York, as trustee (the
"Property Trustee" and, in its separate corporate capacity and not in its
capacity as Property Trustee, the "Bank"), (iii) Chase Manhattan Bank Delaware,
a banking corporation duly organized under the laws of the State of Delaware,
as Delaware trustee (the "Delaware Trustee" and, in its separate corporate
capacity and not in its capacity as Delaware Trustee, the "Delaware Bank"),
(iv) Robert T. Lucas III, an individual, and S.L. Love, an individual, as
administrative trustees (each an "Administrative Trustee" and together the
"Administrative Trustees") (the Property Trustee, the Delaware Trustee and the
Administrative Trustees referred to collectively as the "Trustees") and (v) the
several Holders, as hereinafter defined.
WITNESSETH:
WHEREAS, the Depositor and the Delaware Trustee have heretofore duly declared
and established a business trust pursuant to the Delaware Business Trust Act by
the entering into that certain Trust Agreement, dated as of , (the
"Original Trust Agreement"), and by the execution and filing by the Delaware
Trustee with the Secretary of State of the State of Delaware of the Certificate
of Trust, dated , (the "Certificate of Trust"); and
WHEREAS, the parties hereto desire to amend and restate the Original Trust
Agreement in its entirety as set forth herein to provide for, among other
things, (i) the addition of the Bank, Robert T. Lucas III and S.L. Love as
trustees of the Trust, (ii) the acquisition by the Trust from the Depositor of
all of the right, title and interest in the Junior Subordinated Notes, (iii)
the issuance of the Common Securities by the Trust to the Depositor, and (iv)
the issuance and sale of the Preferred Securities by the Trust pursuant to the
Underwriting Agreement.
NOW THEREFORE, in consideration of the agreements and obligations set forth
herein and for other good and valuable consideration, the sufficiency of which
is hereby acknowledged, each party, for the benefit of the other parties and
for the benefit of the Securityholders, hereby amends and restates the Original
Trust Agreement in its entirety and agrees as follows:
ARTICLE I
Defined Terms
Section 1.01 Definitions. For all purposes of this Trust Agreement, except as
otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them in
this Article and include the plural as well as the singular;
(b) all other terms used herein that are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to
them therein;
<PAGE>
(c) unless the context otherwise requires, any reference to an "Article" or
a "Section" refers to an Article or a Section, as the case may be, of this
Trust Agreement; and
(d) the words "herein," "hereof" and "hereunder" and other words of similar
import refer to this Trust Agreement as a whole and not to any particular
Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.08.
"Additional Amount" means, with respect to Trust Securities of a given
Liquidation Amount and/or a given period, an amount equal to the Additional
Interest (as defined in clause (ii) of the definition of "Additional Interest"
in the Subordinated Indenture) paid by the Depositor on a Like Amount of Junior
Subordinated Notes for such period.
"Administrative Trustee" means each of the individuals identified as an
"Administrative Trustee" in the preamble to this Trust Agreement solely in
their capacities as Administrative Trustees of the Trust formed and continued
hereunder and not in their individual capacities, or such trustee's
successor(s) in interest in such capacity, or any successor "Administrative
Trustee" appointed as herein provided.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Bank" has the meaning specified in the preamble to this Trust Agreement.
"Bankruptcy Event" means, with respect to any Person:
(i) the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of such Person in an involuntary case
or proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging such
Person a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in
respect of such Person under any applicable federal or state law, or
appointing a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of such Person or of any substantial
part of its property, or ordering the winding up or liquidation of its
affairs, and the continuance of any such decree or order for relief or any
such other decree or order unstayed and in effect for a period of 90
consecutive days; or
(ii) the commencement by such Person of a voluntary case or proceeding
under any applicable federal or state bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to
be adjudicated a bankrupt or insolvent, or the consent by it to the entry
of a decree or order for relief in respect of such Person in an involuntary
case or proceeding under any applicable federal or state bankruptcy,
insolvency, reorganization or other similar law or to the commencement of
any bankruptcy or insolvency case or proceeding against
2
<PAGE>
it, or the filing by it of a petition or answer or consent seeking
reorganization or relief under any applicable federal or state law, or the
consent by it to the filing of such petition or to the appointment of or
taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Corporation or of any
substantial part of its property, or the making by it of an assignment for
the benefit of creditors, or the admission by it in writing of its
inability to pay its debts generally as they become due, or the
authorization of any such action by the board of directors of such Person;
"Bankruptcy Laws" has the meaning specified in Section 10.09.
"Board Resolution" means a copy of a resolution certified by the Secretary or
an Assistant Secretary of the Depositor to have been duly adopted by the
Depositor's Board of Directors or a duly authorized committee thereof and to be
in full force and effect on the date of such certification, and delivered to
the Trustees.
"Book-Entry Preferred Securities Certificates" means certificates representing
Preferred Securities issued in global, fully registered form to the Clearing
Agency as described in Section 5.11.
"Business Day" means a day other than (i) a Saturday or a Sunday, (ii) a day on
which banks in New York, New York are authorized or obligated by law or
executive order to remain closed or (iii) a day on which the Corporate Trust
Office or the Indenture Trustee's principal corporate trust office is closed
for business.
"Certificate Depository Agreement" means the agreement among the Trust, The
Chase Manhattan Bank, as agent, and The Depository Trust Company, as the
initial Clearing Agency, dated , relating to the Preferred
Securities Certificates as the same may be amended and supplemented from time
to time.
"Clearing Agency" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act. The Depository Trust Company will
be the initial Clearing Agency.
"Clearing Agency Participant" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency
effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means 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 instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common Security" means an undivided beneficial ownership interest in the
assets of the Trust having a Liquidation Amount of $ and having the rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Common Securities Certificate" means a certificate evidencing ownership of a
Common Security or Securities, substantially in the form attached as Exhibit C.
3
<PAGE>
"Corporate Trust Office" means the office of the Property Trustee located in
New York, New York at which its corporate trust business shall be principally
administered.
"Corporation" means Duke Capital Corporation, its successors and assigns.
"Definitive Preferred Securities Certificates" means either or both (as the
context requires) of (i) Preferred Securities Certificates issued in
certificated, fully registered form as provided in Section 5.11(a) and (ii)
Preferred Securities Certificates issued in certificated, fully registered form
as provided in Section 5.13.
"Delaware Bank" has the meaning specified in the preamble to this Trust
Agreement.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. Code Section 3801 et seq., as it may be amended from time to
time.
"Delaware Trustee" means the commercial bank or trust company or any other
person identified as the "Delaware Trustee" and has the meaning specified in
the preamble to this Trust Agreement solely in its capacity as Delaware Trustee
of the Trust formed and continued hereunder and not in its individual capacity,
or its successor in interest in such capacity, or any successor Delaware
Trustee appointed as herein provided.
"Depositor" means Duke Capital Corporation, in its capacity as "Depositor"
under this Trust Agreement, its successors and assigns.
"Distribution Date" has the meaning specified in Section 4.01(a).
"Distributions" means amounts payable in respect of the Trust Securities as
provided in Section 4.01.
"Event of Default" means any one of the following events (whatever the reason
for such Event of Default and whether it shall be voluntary or involuntary or
be effected by operation of law or pursuant to any judgment, decree or order of
any court or any order, rule or regulation of any administrative or
governmental body):
(i) the occurrence of an Indenture Event of Default; or
(ii) default by the Trust in the payment of any Distribution when it
becomes due and payable, and continuation of such default for a period of
30 days; or
(iii) default by the Trust in the payment of any Redemption Price of any
Trust Security when it becomes due and payable; or
(iv) default in the performance, or breach, of any covenant or warranty of
the Trustees in this Trust Agreement (other than a covenant or warranty a
default in whose performance or breach is dealt with in clause (ii) or
(iii) above) and continuation of such default or breach for a period of 60
days after there has been given, by registered or certified mail, to the
Trustees by the Holders of at least 25% in Liquidation Amount of the
Outstanding Preferred 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; unless Holders in Liquidation Amount of
Outstanding Preferred Securities not less than the Liquidation Amount of
Outstanding Preferred Securities
4
<PAGE>
the Holders of which gave such notice, shall agree in writing to an
extension of such period prior to its expiration; provided, however, that
the Holders of such Liquidation Amount of Outstanding Preferred Securities
shall be deemed to have agreed to an extension of such period if corrective
action is initiated by the Trustees within such period and is being
diligently pursued; or
(v) the occurrence of a Bankruptcy Event with respect to the Trust.
"Expense Agreement" means the Agreement as to Expenses and Liabilities between
the Corporation and the Trust, substantially in the form attached as Exhibit D,
as amended from time to time.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from time
to time, or any successor legislation.
"Guarantee" means the Guarantee Agreement executed and delivered by the
Corporation and The Chase Manhattan Bank, as Guarantee Trustee,
contemporaneously with the execution and delivery of this Trust Agreement, for
the benefit of the Holders of the Preferred Securities, as amended from time to
time.
"Indenture Event of Default" means an "Event of Default" as defined in the
Subordinated Indenture with respect to the Junior Subordinated Notes.
"Indenture Redemption Date" means "Redemption Date," as defined in the
Subordinated Indenture.
"Indenture Trustee" means the trustee under the Subordinated Indenture.
"Investment Company Act" means the Investment Company Act of 1940, as amended
from time to time, or any successor legislation.
"Issue Date" means the date of the delivery of the Trust Securities.
"Junior Subordinated Notes" means the $ aggregate principal amount of the
Depositor's Series % Junior Subordinated Notes due , issued
pursuant to the Subordinated Indenture.
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of trust,
adverse ownership interest, hypothecation, assignment, security interest or
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever.
"Like Amount" means (i) Trust Securities having a Liquidation Amount equal to
the principal amount of Junior Subordinated Notes to be contemporaneously
redeemed in accordance with the Subordinated Indenture and the proceeds of
which will be used to pay the Redemption Price of such Trust Securities and
(ii) Junior Subordinated Notes having a principal amount equal to the
Liquidation Amount of the Trust Securities of the Holder to whom such Junior
Subordinated Notes are distributed.
"Liquidation Amount" means the stated amount of $ per Trust Security.
5
<PAGE>
"Liquidation Date" means the date on which Junior Subordinated Notes are to be
distributed to Holders of Trust Securities in connection with a liquidation of
the Trust pursuant to Section 9.04.
"Liquidation Distribution" has the meaning specified in Section 9.05.
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, the President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary, of the Depositor, and
delivered to the appropriate Trustee. One of the officers signing an Officers'
Certificate to be delivered by the Depositor pursuant to Section 8.16 shall be
the principal executive, financial or accounting officer of the Depositor. An
Officers' Certificate delivered with respect to compliance with a condition or
covenant provided for in this Trust Agreement shall include:
(a) a statement that each officer signing the Officers' Certificate has
read such covenant or condition and the definitions herein relating
thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in the
Officers' Certificate are based;
(c) a statement that, in the opinion of each such officer, 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
(d) a statement as to whether, in the opinion of each such officer, such
condition or covenant has been complied with.
"OID" means "original issue discount" as that term is defined in the Internal
Revenue Code of 1986, as amended.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel for
the Trust, the Trustees or the Depositor, but not an employee of the Trust or
the Trustees, and who shall be reasonably acceptable to the Property Trustee.
Any Opinion of Counsel pertaining to federal income tax matters may rely on
published rulings of the Internal Revenue Service.
"Original Trust Agreement" has the meaning specified in the recitals to this
Trust Agreement.
"Outstanding," when used with respect to Preferred Securities, means, as of the
date of determination, all Preferred Securities theretofore authenticated and
delivered under this Trust Agreement, except:
(i) Preferred Securities theretofore cancelled by the Administrative
Trustees or delivered to the Administrative Trustees for cancellation;
(ii) Preferred Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Property Trustee
or any Paying Agent for the Holders of such Preferred Securities; provided
that if such Preferred Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this Trust Agreement or
provision therefor satisfactory to the Property Trustee has been made; and
(iii) Preferred Securities in exchange for or in lieu of which other
Preferred Securities have been authenticated and delivered pursuant to this
Trust Agreement;
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provided, however, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Preferred Securities have given any
request, demand, authorization, direction, notice, consent or waiver hereunder,
Preferred Securities owned, whether of record or beneficially, by the
Depositor, the Holder of the Common Securities, any Administrative Trustee or
any Affiliate of the Depositor or any Administrative Trustee shall be
disregarded and deemed not to be Outstanding, except that (a) in determining
whether any Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only Preferred
Securities which such Trustee knows to be so owned shall be so disregarded and
(b) the foregoing shall not apply at any time when all of the outstanding
Preferred Securities are owned by the Depositor, the Holder of the Common
Securities, one or more Administrative Trustees and/or any such Affiliate.
Preferred Securities so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Administrative Trustees the pledgee's right so to act with respect to such
Preferred Securities and that the pledgee is not the Depositor or any Affiliate
of the Depositor.
"Owner" means each Person who is the beneficial owner of a Book-Entry Preferred
Securities Certificate as reflected in the records of the Clearing Agency or,
if a Clearing Agency Participant is not the Owner, then as reflected in the
records of a Person maintaining an account with such Clearing Agency (directly
or indirectly, in accordance with the rules of such Clearing Agency).
"Paying Agent" means any paying agent or co-paying agent appointed pursuant to
Section 5.09 and shall initially be the Property Trustee.
"Payment Account" means a segregated non-interest-bearing corporate trust
account maintained by the Property Trustee for the benefit of the
Securityholders in which all amounts paid in respect of the Junior Subordinated
Notes will be held and from which the Property Trustee shall make payments to
the Securityholders in accordance with Section 4.01.
"Person" means an individual, corporation, partnership, joint venture, trust,
limited liability company or corporation, unincorporated organization or
government or any agency or political subdivision thereof.
"Preferred Security" means an undivided beneficial ownership interest in the
assets of the Trust having a Liquidation Amount of $ and having rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Preferred Securities Certificate" means a certificate evidencing ownership of
a Preferred Security or Securities, substantially in the form attached as
Exhibit E.
"Property Trustee" means the commercial bank or trust company identified as the
"Property Trustee" in the preamble to this Trust Agreement solely in its
capacity as Property Trustee of the Trust formed and continued hereunder and
not in its individual capacity, or its successor in interest in such capacity,
or any successor "Property Trustee" as herein provided.
"Redemption Date" means, with respect to any Trust Security to be redeemed, the
date fixed for such redemption by or pursuant to this Trust Agreement; provided
that each Indenture Redemption Date shall be a Redemption Date for a Like
Amount of Trust Securities.
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"Redemption Price" means, with respect to any date fixed for redemption of any
Trust Security, the Liquidation Amount of such Trust Security, plus accrued and
unpaid Distributions to such date.
"Relevant Trustee" has the meaning specified in Section 8.10.
"Securities Act" means the Securities Act of 1933, as amended from time to
time, or any successor legislation.
"Security Register" and "Security Registrar" are described in Section 5.04.
"Securityholder" or "Holder" means a Person in whose name a Trust Security or
Securities is registered in the Security Register; any such Person is a
beneficial owner within the meaning of the Delaware Business Trust Act.
"Subordinated Indenture" means the Subordinated Indenture, dated as of April 1,
1998, between the Depositor and the Indenture Trustee, as heretofore
supplemented and amended and as supplemented by the Supplemental Indenture.
"Supplemental Indenture" means the Supplemental Indenture, dated as of
, , by and between the Depositor and the Indenture Trustee.
"Trust" means the Delaware business trust continued hereby and identified on
the cover page to this Trust Agreement.
"Trust Agreement" means this Amended and Restated Trust Agreement, as the same
may be modified, amended or supplemented in accordance with the applicable
provisions hereof, including all exhibits hereto, including, for all purposes
of this Amended and Restated Trust Agreement and any modification, amendment or
supplement, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this Amended and Restated Trust Agreement and any such
modification, amendment or supplement, respectively.
"Trustees" means the Persons identified as "Trustees" in the preamble to this
Trust Agreement solely in their capacities as Trustees of the Trust formed
hereunder and not in their individual capacities, or any successor in interest
in such capacity, or any successor trustee appointed as herein provided.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at the
date as of which this instrument was executed; provided, however, that in the
event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trust Property" means (i) the Junior Subordinated Notes, (ii) any cash on
deposit in, or owing to, the Payment Account, and (iii) all proceeds and rights
in respect of the foregoing and any other property and assets for the time
being held or deemed to be held by the Property Trustee pursuant to this Trust
Agreement.
"Trust Securities Certificate" means any one of the Common Securities
Certificates or the Preferred Securities Certificates.
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"Trust Security" means any one of the Common Securities or the Preferred
Securities.
"Underwriting Agreement" means the Underwriting Agreement, dated , ,
among the Trust, the Depositor and the underwriters named therein.
ARTICLE II
Establishment of the Trust
Section 2.01 Name. The Trust continued hereby shall be known as "Duke Capital
Financing Trust [ ]," in which name the Trustees may conduct the business of
the Trust, make and execute contracts and other instruments on behalf of the
Trust and sue and be sued. The Administrative Trustees may change the name of
the Trust from time to time following written notice to the Holders.
Section 2.02 Offices of the Trustees; Principal Place of Business. The address
of the Property Trustee is The Chase Manhattan Bank, 450 West 33rd Street, New
York, New York 10001, or at such other address in New York as the Property
Trustee may designate by written notice to the Securityholders and the
Depositor. The principal place of business of the Delaware Trustee is 1201
Market Street, Wilmington, Delaware 19801, or at such other address in Delaware
as the Delaware Trustee may designate by notice to the Depositor. The address
of the Administrative Trustees is c/o Duke Capital Corporation, 422 South
Church Street, Charlotte, North Carolina 28202, Attention: Corporate Secretary.
The principal place of business of the Trust is c/o Duke Capital Corporation,
422 South Church Street, Charlotte, North Carolina 28202. The Depositor may
change the principal place of business of the Trust at any time by giving
notice thereof to the Trustees.
Section 2.03 Initial Contribution of Trust Property; Organizational
Expenses. The Delaware Trustee acknowledges receipt in trust from the Depositor
in connection with the Original Trust Agreement of the sum of $10, which
constituted the initial Trust Property. The Depositor shall pay organizational
expenses of the Trust as they arise or shall, upon request of the Trustees,
promptly reimburse the Trustees for any such expenses paid by the Trustees. The
Depositor shall make no claim upon the Trust Property for the payment of such
expenses.
Section 2.04 Issuance of the Preferred Securities. Contemporaneously with the
execution and delivery of this Trust Agreement, the Administrative Trustees, on
behalf of the Trust, shall execute and deliver to the underwriters named in the
Underwriting Agreement Preferred Securities Certificates, registered in the
name of the nominee of the initial Clearing Agency, in an aggregate amount of
Preferred Securities having an aggregate Liquidation Amount of $
(the "Preferred Securities") against receipt of the aggregate purchase price of
such Preferred Securities of $ , which amount the Administrative Trustees
shall promptly deliver to the Property Trustee.
Section 2.05 Subscription and Purchase of Junior Subordinated Notes; Issuance
of the Common Securities. Contemporaneously with the execution and delivery of
this Trust Agreement, the Administrative Trustees, on behalf of the Trust,
shall execute and deliver to the Depositor Common Securities Certificates,
registered in the name of the Depositor, in an aggregate amount of
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Common Securities having an aggregate Liquidation Amount of $ , against
payment by the Depositor of such amount. Contemporaneously therewith, the
Administrative Trustees, on behalf of the Trust, shall subscribe to and
purchase from the Depositor Junior Subordinated Notes, registered in the name
of the Property Trustee, on behalf of the Trust and the Holders, and having an
aggregate principal amount equal to $ and, in satisfaction of the purchase
price for such Junior Subordinated Notes, the Property Trustee, on behalf of
the Trust, shall deliver to the Depositor the sum of $ .
Section 2.06 Declaration of Trust. The exclusive purposes and functions of the
Trust are (i) to issue and sell the Trust Securities and use the proceeds from
such sale to acquire the Junior Subordinated Notes, and (ii) to engage in only
those other activities necessary, incidental, appropriate or convenient
thereto. The Depositor hereby appoints each of the Bank, the Delaware Bank,
Robert T. Lucas III, and S.L. Love as trustees of the Trust, to have all the
rights, powers and duties to the extent set forth herein. The Property Trustee
hereby declares that it will hold the Trust Property in trust upon and subject
to the conditions set forth herein subject to the conditions set forth herein
for the benefit of the Trust and the Securityholders. The Trustees shall have
all rights, powers and duties set forth herein and in accordance with
applicable law with respect to accomplishing the purposes of the Trust. 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 Property
Trustee or the Administrative Trustees set forth herein. The Delaware Trustee
shall be one of the Trustees for the sole and limited purpose of fulfilling the
requirements of the Delaware Business Trust Act. The Delaware Trustee, as the
trustee under the Original Trust Agreement, has filed the Certificate of Trust
of the Trust with the office of the Secretary of State of the State of
Delaware, a copy of which is attached hereto as Exhibit A, and such filing is
hereby confirmed and ratified.
Section 2.07 Authorization to Enter into Certain Transactions. The Trustees
shall conduct the affairs of the Trust in accordance with the terms of this
Trust Agreement. Subject to the limitations set forth in paragraph (C) of this
Section, and in accordance with the following paragraphs (A) and (B), the
Trustees shall have the authority to enter into all transactions and agreements
determined by the Trustees to be appropriate in exercising the authority,
express (in the case of the Property Trustee) or implied, otherwise granted to
the Trustees under this Trust Agreement, and to perform all acts in furtherance
thereof, including, without limitation, the following:
(A) As among the Trustees, the Administrative Trustees, acting singly or
jointly, shall have the exclusive power, duty and authority to act on
behalf of the Trust with respect to the following matters:
(i) to acquire the Junior Subordinated Notes with the proceeds of the
sale of the Trust Securities; provided, however, the Administrative
Trustees shall cause legal title to all of the Junior Subordinated
Notes to be vested in, and the Junior Subordinated Notes to be held of
record in the name of, the Property Trustee for the benefit of the
Trust and the Holders of the Trust Securities;
(ii) to give the Depositor and the Property Trustee prompt written
notice of the occurrence of any Special Event (as defined in the
Supplemental Indenture) and to take any ministerial actions in
connection therewith; provided that the Administrative Trustees shall
consult
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with the Depositor and the Property Trustee before taking or refraining
to take any ministerial action in relation to a Special Event;
(iii) to establish a record date with respect to all actions to be
taken hereunder that require a record date be established, including
for the purposes of (S)316(c) of the Trust Indenture Act and with
respect to Distributions, voting rights, redemptions, and exchanges,
and to issue relevant notices to Holders of the Trust Securities as to
such actions and applicable record dates;
(iv) 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 2.07(B)(v), the
Property Trustee has the power to bring such Legal Action;
(v) 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;
(vi) to cause the Trust to comply with the Trust's obligations under
the Trust Indenture Act;
(vii) to give the certificate to the Property Trustee required by
(S)314(a)(4) of the Trust Indenture Act, which certificate may be
executed by any Administrative Trustee;
(viii) to take all actions and perform such duties as may be required
of the Administrative Trustees pursuant to the terms of this Trust
Agreement;
(ix) 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 Trust Securities or to enable the Trust to effect
the purposes for which the Trust has been created;
(x) 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;
(xi) to issue and sell the Trust Securities;
(xii) to cause the Trust to enter into, and to execute, deliver and
perform on behalf of the Trust, the Expense Agreement and such other
agreements as may be necessary or desirable in connection with the
consummation hereof;
(xiii) to assist in the registration of the Preferred Securities under
the Securities Act and under state securities or blue sky laws, and the
qualification of the Trust Agreement as a trust indenture under the
Trust Indenture Act;
(xiv) to assist in the listing of the Preferred Securities upon such
securities exchange or exchanges as shall be determined by the
Depositor and, if required, the registration of the Preferred
Securities under the Exchange Act, and the preparation and filing of
all periodic and other reports and other documents pursuant to the
foregoing;
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(xv) to send notices (other than notices of default) and other
information regarding the Trust Securities and the Junior Subordinated
Notes to the Securityholders in accordance with this Trust Agreement;
(xvi) to appoint a Paying Agent (subject to Section 5.09),
authenticating agent and Security Registrar in accordance with this
Trust Agreement;
(xvii) to register transfers of the Trust Securities in accordance with
this Trust Agreement;
(xviii) to assist in, to the extent provided in this Trust Agreement,
the winding-up of the affairs of and termination of the Trust and the
preparation, execution and filing of the certificate of cancellation
with the Secretary of State of the State of Delaware; and
(xix) to take any action incidental to the foregoing as the
Administrative Trustees may from time to time determine is necessary,
appropriate, convenient or advisable to protect and conserve the Trust
Property for the benefit of the Securityholders (without consideration
of the effect of any such action on any particular Securityholder).
(B) As among the Trustees, the Property Trustee shall have the exclusive
power, duty and authority to act on behalf of the Trust with respect to the
following matters:
(i) engage in such ministerial activities as shall be necessary or
appropriate to effect promptly the redemption of the Trust Securities
to the extent the Junior Subordinated Notes are redeemed or mature;
(ii) upon notice of distribution issued by the Administrative Trustees
in accordance with the terms of this Trust Agreement, engage in such
ministerial activities as shall be necessary or appropriate to effect
promptly the distribution pursuant to the terms of this Trust Agreement
of Junior Subordinated Notes to Holders of Trust Securities;
(iii) subject to the terms hereof, exercise all of the rights, powers
and privileges of a holder of the Junior Subordinated Notes under the
Subordinated Indenture and, if an Event of Default occurs and is
continuing, enforce for the benefit of, and subject to the rights of,
the Holders of the Trust Securities, its rights as holder of the Junior
Subordinated Notes under the Subordinated Indenture;
(iv) take all actions and perform such duties as may be specifically
required of the Property Trustee pursuant to the terms of this Trust
Agreement;
(v) take any Legal Action which arises out of or in connection with an
Event of Default or the Property Trustee's duties and obligations under
this Trust Agreement, the Delaware Business Trust Act or the Trust
Indenture Act;
(vi) the establishment and maintenance of the Payment Account;
(vii) the receipt of and holding of legal title to the Junior
Subordinated Notes as described herein;
(viii) the collection of interest, principal and any other payments
made in respect of the Junior Subordinated Notes in the Payment
Account;
(ix) the distribution of amounts received in the Payment Account and
owed to the Securityholders in respect of the Trust Securities;
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(x) the sending of notices of default and other information regarding
the Trust Securities and the Junior Subordinated Notes to the
Securityholders in accordance with this Trust Agreement;
(xi) the distribution of the Trust Property in accordance with the
terms of this Trust Agreement;
(xii) as provided in this Trust Agreement, the winding-up of the
affairs of and termination of the Trust and the preparation, execution
and filing of the certificate of cancellation with the Secretary of
State of Delaware; and
(xiii) the taking of any action incidental to the foregoing as the
Property Trustee may from time to time determine is necessary,
appropriate, convenient or advisable to protect and conserve the Trust
Property for the benefit of the Securityholders (without consideration
of the effect of any such action on any particular Securityholder).
(C) So long as this Trust Agreement remains in effect, the Trust (or the
Trustees acting on behalf of the Trust) shall not undertake any business,
activity or transaction except as expressly provided herein or contemplated
hereby. In particular, the Trustees shall not (i) acquire any investments
or engage in any activities not authorized by this Trust Agreement, (ii)
sell, assign, transfer, exchange, pledge, set-off or otherwise dispose of
any of the Trust Property or interests therein, including to
Securityholders, except as expressly provided herein, (iii) take any action
that would cause the Trust to fail or cease to qualify as a grantor trust
for United States federal income tax purposes, (iv) incur any indebtedness
for borrowed money, (v) take or consent to any action that would result in
the placement of a Lien on any of the Trust Property, (vi) issue any
securities other than the Trust Securities, or (vii) have any power to, or
agree to any action by the Depositor that would, vary the investment
(within the meaning of Treasury Regulation Section 301.7701-4(c)) of the
Trust or of the Securityholders. The Trustees shall defend all claims and
demands of all Persons at any time claiming any Lien on any of the Trust
Property adverse to the interest of the Trust or the Securityholders in
their capacity as Securityholders.
(D) In connection with the issue and sale of the Preferred Securities, the
Depositor shall have the right and responsibility to assist the Trust with
respect to, or effect on behalf of the Trust, the following (and any
actions taken by the Depositor in furtherance of the following prior to the
date of this Trust Agreement are hereby ratified and confirmed in all
respects):
(i) to prepare for filing by the Trust with the Commission a
registration statement on Form S-3 under the Securities Act in relation
to the Preferred Securities, including any amendments thereto;
(ii) to determine the states in which to take appropriate action to
qualify or register for sale all or part of the Preferred Securities
and to do any and all such acts, other than actions which must be taken
by or on behalf of the Trust, and advise the Trustees of actions they
must take on behalf of the Trust, and prepare for execution and filing
any documents to be executed and filed by the Trust or on behalf of the
Trust, as the Depositor deems necessary or advisable in order to comply
with the applicable laws of any such states;
(iii) 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 upon notice of issuance of any Preferred
Securities;
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(iv) to prepare for filing by the Trust with the Commission a
registration statement on Form 8-A relating to the registration of the
Preferred Securities under Section 12(b) of the Exchange Act, including
any amendments thereto;
(v) to negotiate the terms of the Underwriting Agreement providing for
the sale of the Preferred Securities and to execute, deliver and
perform the Underwriting Agreement on behalf of the Trust;
(vi) to negotiate the terms of the Certificate Depository Agreement
relating to the Preferred Securities and to execute, deliver and
perform the Certificate Depository Agreement on behalf of the Trust;
and
(vii) any other actions necessary, incidental, appropriate or
convenient to carry out any of the foregoing activities.
(E) Notwithstanding anything herein to the contrary, the Administrative
Trustees are authorized and directed to conduct the affairs of the Trust
and to operate the Trust so that the Trust will not be deemed to be an
"investment company" required to be registered under the Investment Company
Act, or taxed as other than a grantor trust for United States federal
income tax purposes and so that the Junior Subordinated Notes will be
treated as indebtedness of the Depositor for United States federal income
tax purposes. In this connection, the Depositor and the Administrative
Trustees are authorized to take any action, not inconsistent with
applicable law, the Certificate of Trust or this Trust Agreement, that each
of the Depositor and the Administrative Trustees determines in its
discretion to be necessary or desirable for such purposes, as long as such
action does not materially and adversely affect the interests of the
Holders of the Preferred Securities.
Section 2.08 Assets of Trust. The assets of the Trust shall consist of the
Trust Property.
Section 2.09 Title to Trust Property. Legal title to all Trust Property shall
be vested at all times in the Property Trustee (in its capacity as such) and
shall be held and administered by the Property Trustee for the benefit of the
Securityholders and the Trust in accordance with this Trust Agreement. The
right, title and interest of the Property Trustee to the Junior Subordinated
Notes shall vest automatically in each Person who may thereafter be appointed
as Property Trustee in accordance with the terms hereof. Such vesting and
cessation of title shall be effective whether or not conveyancing documents
have been executed and delivered.
Section 2.10 Mergers and Consolidations of the Trust. The Trust may not
consolidate, amalgamate, merge with or into, or be replaced by, or convey,
transfer or lease its properties and assets substantially as an entirety to any
corporation or other entity, except as described below. The Trust may at the
request of the Corporation, with the consent of the Administrative Trustees and
without the consent of the Holders of the Trust Securities, consolidate,
amalgamate, merge with or into, or be replaced by a trust organized as such
under the laws of any state; provided that (i) such successor entity either (x)
expressly assumes all of the obligations of the Trust with respect to the Trust
Securities or (y) substitutes for the Preferred Securities other securities
having substantially the same terms as the Trust Securities (herein referred to
as 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) the Corporation
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expressly appoints a trustee of such successor entity possessing the same
powers and duties as the Property Trustee as the holder of legal title to the
Junior Subordinated Notes, (iii) the Preferred Securities or any Successor
Securities are listed, or any Successor Securities will be listed upon
notification of issuance, on any national securities exchange or other
organization on which the Preferred Securities are then listed, (iv) such
merger, consolidation, amalgamation or replacement does not cause the Preferred
Securities (including any Successor Securities) to be downgraded by any
nationally recognized statistical rating organization, (v) such consolidation,
amalgamation, merger or replacement does not adversely affect the rights,
preferences and privileges of the Holders of the Trust Securities (including
any Successor Securities) in any material respect, (vi) such successor entity
has a purpose substantially identical to that of the Trust, (vii) prior to such
consolidation, amalgamation, merger or replacement, the Corporation and the
Property Trustee have received an Opinion of Counsel experienced in such
matters to the effect that (A) such consolidation, amalgamation, merger or
replacement 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 consolidation, amalgamation, merger or
replacement, neither the Trust nor such successor entity will be required to
register as an investment company under the Investment Company Act, and (viii)
the Corporation 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 any other entity or permit any other entity to
consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger or replacement would cause the Trust or the
successor entity to be classified as other than a grantor trust for United
States federal income tax purposes.
ARTICLE III
Payment Account
Section 3.01 Payment Account.
(a) On or prior to the Issue Date, the Property Trustee shall establish the
Payment Account. The Property Trustee and an agent of the Property Trustee
shall have exclusive control and sole right of withdrawal with respect to the
Payment Account for the purpose of making deposits in and withdrawals from the
Payment Account in accordance with this Trust Agreement. All monies and other
property deposited or held from time to time in the Payment Account shall be
held by the Property Trustee in the Payment Account for the exclusive benefit
of the Securityholders and for distribution as herein provided, including (and
subject to) any priority of payments provided for herein.
(b) The Property Trustee shall deposit in the Payment Account, promptly upon
receipt, all payments of principal or interest on, and any other payments or
proceeds with respect to, the Junior Subordinated Notes. Amounts held in the
Payment Account shall not be invested by the Property Trustee pending
distribution thereof.
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ARTICLE IV
Distributions; Redemption
Section 4.01 Distributions.
(a) Distributions on the Trust Securities shall be cumulative and accrue from
the Issue Date and, except in the event that the Depositor exercises its right
to extend the interest payment period for the Junior Subordinated Notes
pursuant to Section 104 of the Supplemental Indenture, shall be payable
quarterly in arrears on March 31, June 30, September 30 and December 31 of each
year, commencing on , . If any date on which Distributions are
otherwise payable on the Trust Securities is not a Business Day, then the
payment of such Distribution shall be made on the next succeeding day which is
a Business Day (and without any interest or other payment in respect of any
such delay) except that, if such Business Day is in the next succeeding
calendar year, payment of such Distribution shall be made on the immediately
preceding Business Day, in each case, with the same force and effect as if made
on such date (each such date, a "Distribution Date").
(b) Distributions payable on the Trust Securities shall be fixed at a rate of
% per annum of the Liquidation Amount of the Trust Securities. The amount of
Distributions payable for any full quarterly period shall be computed on the
basis of twelve 30-day months and a 360-day year. If the interest payment
period for the Junior Subordinated Notes is extended pursuant to Section 104 of
the Supplemental Indenture (an "Extension Period"), then the rate per annum at
which Distributions on the Trust Securities accumulate shall be increased by an
amount such that the aggregate amount of Distributions that accumulate on all
Trust Securities during any such Extension Period is equal to the aggregate
amount of interest (including interest payable on unpaid interest at the
percentage rate per annum set forth above, compounded quarterly, to the extent
permitted by applicable law) that accrues during any such Extension Period on
the Junior Subordinated Notes. The payment of such deferred interest, together
with interest thereon, will be distributed, if funds are legally available
therefor, to the Holders of the Trust Securities (as they appear on the books
and records of the Trust on the record date (as specified in Section 4.01(d))
next following the termination of such Extension Period) as received at the end
of any Extension Period. The amount of Distributions payable for any period
shall include the Additional Amounts, if any.
(c) Distributions on the Trust Securities shall be made and shall be deemed
payable on each Distribution Date only to the extent that the Trust has legally
and immediately available funds in the Payment Account for the payment of such
Distributions.
(d) Distributions (including Additional Amounts, if any) on the Trust
Securities on each Distribution Date shall be payable to the Holders thereof as
they appear on the Security Register for the Trust Securities on the relevant
record date, which shall be the close of business on the fifteenth calendar day
prior to the relevant Distribution Date.
Each Trust Security upon registration of transfer of or in exchange for or in
lieu of any other Trust Security shall carry the rights of Distributions
accrued (including Additional Amounts, if any) and unpaid, and to accrue
(including Additional Amounts, if any), which were carried by such other Trust
Security.
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Section 4.02 Redemption.
(a) On each Redemption Date with respect to the Junior Subordinated Notes, the
Trust will be required to redeem a Like Amount of Trust Securities at the
Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee by first-class
mail, postage prepaid, mailed not less than 30 nor more than 60 days prior to
the Redemption Date to each Holder of Trust Securities to be redeemed, at such
Holder's address appearing in the Security Register. All notices of redemption
shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the CUSIP number;
(iv) if less than all the Outstanding Trust Securities are to be redeemed,
the total Liquidation Amount of the Trust Securities to be redeemed; and
(v) that on the Redemption Date the Redemption Price will become due and
payable upon each such Trust Security to be redeemed and the Distributions
thereon will cease to accrue on and after such date.
(c) The Trust Securities redeemed on each Redemption Date shall be redeemed at
the Redemption Price with the proceeds from the contemporaneous redemption of
Junior Subordinated Notes. Redemptions of the Trust Securities shall be made
and the Redemption Price shall be deemed payable on each Redemption Date only
to the extent that the Trust has funds legally and immediately available in the
Payment Account for the payment of such Redemption Price.
(d) If the Property Trustee gives a notice of redemption in respect of any
Preferred Securities, then, by 2:00 P.M. New York City time, on the Redemption
Date, subject to Section 4.02(c), the Property Trustee will, so long as the
Preferred Securities are in book-entry only form, irrevocably deposit with the
Clearing Agency for the Preferred Securities funds sufficient to pay the
applicable Redemption Price. If the Preferred Securities are not in book-entry
only form, the Property Trustee, subject to Section 4.02(c), shall irrevocably
deposit with the Paying Agent funds sufficient to pay the applicable Redemption
Price and will give the Paying Agent irrevocable instructions to pay the
Redemption Price to the Holders thereof upon surrender of their Preferred
Securities Certificates. Notwithstanding the foregoing, Distributions payable
on or prior to the Redemption Date for any Trust Securities called for
redemption shall be payable to the Holders of such Trust Securities as they
appear on the Security Register for the Trust 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 immediately prior to the close
of business on the date of such deposit, all rights of Securityholders holding
Trust Securities so called for redemption will cease, except the right of such
Securityholders to receive the Redemption Price, but without interest, and such
Securities will cease to be outstanding. In the event that any date on which
any Redemption Price is payable is not a Business Day, then payment of the
Redemption Price payable on such date shall be made on the next succeeding day
which is a Business Day (and without any interest or other payment in respect
of any such delay) except that, if such Business Day is in the next succeeding
calendar year, payment of such Redemption Price shall be made on the
immediately preceding Business Day, in each case, with
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the same force and effect as if made on such date. In the event that payment of
the Redemption Price in respect of Trust Securities is improperly withheld or
refused and not paid either by the Trust or by the Depositor pursuant to the
Guarantee, Distributions on such Trust Securities will continue to accrue at
the then applicable rate, from such Redemption Date originally established by
the Trust for such Preferred Securities to the date such Redemption Price is
actually paid.
(e) Payment of the Redemption Price on the Trust Securities shall be made to
the recordholders thereof as they appear on the Security Register for the Trust
Securities on the relevant record date, which shall be the close of business on
the fifteenth calendar day prior to the Redemption Date.
(f) If less than all the Outstanding Trust Securities are to be redeemed on a
Redemption Date, then the aggregate Liquidation Amount of Trust Securities to
be redeemed shall be allocated 3% to the Common Securities and 97% to the
Preferred Securities, with such adjustments that each amount so allocated shall
be divisible by $ . The particular Preferred Securities to be redeemed shall
be selected not more than 60 days prior to the Redemption Date by the Property
Trustee from the Outstanding Preferred Securities not previously called for
redemption, by such method as the Property Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $ or integral multiples thereof) of the Liquidation Amount of
Preferred Securities of a denomination larger than $ ; provided, however, that
before undertaking redemption of the Preferred Securities on other than a pro
rata basis, the Property Trustee shall have received an Opinion of Counsel that
the status of the Trust as a grantor trust for United States federal income tax
purposes would not be adversely affected. The Property Trustee shall promptly
notify the Security Registrar in writing of the Preferred Securities selected
for redemption and, in the case of any Preferred Securities selected for
partial redemption, the Liquidation Amount thereof to be redeemed. For all
purposes of this Trust Agreement, unless the context otherwise requires, all
provisions relating to the redemption of Preferred Securities shall relate, in
the case of any Preferred Securities redeemed or to be redeemed only in part,
to the portion of the Liquidation Amount of Preferred Securities which has been
or is to be redeemed.
(g) Subject to the foregoing provisions of Section 4.02 and to applicable law
(including, without limitation, United States federal securities laws), the
Corporation or its Affiliates may, at any time and from time to time, purchase
outstanding Preferred Securities by tender, in the open market or by private
agreement.
Section 4.03 Subordination of Common Securities.
(a) Payment of Distributions (including Additional Amounts, if applicable) on,
and the Redemption Price of, the Trust 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 an Indenture Event
of Default shall have occurred and be continuing, no payment of any
Distribution (including Additional Amounts, if applicable) on, or Redemption
Price of, any Common Security, and no other payment on account of the
redemption, liquidation or other acquisition of Common Securities, shall be
made unless payment in full in cash of all accumulated and unpaid Distributions
(including Additional Amounts, if applicable) on all Outstanding Preferred
Securities for all distribution periods terminating on or prior thereto, or in
the case of payment of the Redemption Price the full amount of such Redemption
Price on all Outstanding Preferred Securities, shall have
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been made or provided for, and all funds immediately available to the Property
Trustee shall first be applied to the payment in full in cash of all
Distributions (including Additional Amounts, if applicable) on, or the
Redemption Price of, Preferred Securities then due and payable.
(b) In the case of the occurrence of any Indenture Event of Default, the Holder
of Common Securities will be deemed to have waived any such Event of Default
under this Trust Agreement until the effect of all such Events of Default with
respect to the Preferred Securities have been cured, waived or otherwise
eliminated. Until any such Events of Default under this Trust Agreement with
respect to the Preferred Securities have been so cured, waived or otherwise
eliminated, the Property Trustee shall act solely on behalf of the Holders of
the Preferred Securities and not the Holder of the Common Securities, and only
the Holders of the Preferred Securities will have the right to direct the
Property Trustee to act on their behalf.
Section 4.04 Payment Procedures. Payments in respect of the Preferred
Securities shall be made by check mailed to the address of the Person entitled
thereto as such address shall appear on the Security Register or, if the
Preferred Securities are held by a Clearing Agency, such Distributions shall be
made to the Clearing Agency, which shall credit the relevant Persons' accounts
at such Clearing Agency on the applicable distribution dates. Payments in
respect of the Common Securities shall be made in such manner as shall be
mutually agreed between the Property Trustee and the Holder of the Common
Securities.
Section 4.05 Tax Returns and Reports. The Administrative Trustee(s) shall
prepare (or cause to be prepared), at the Depositor's expense, and file all
United States federal, state and local tax and information returns and reports
required to be filed by or in respect of the Trust.
The Administrative Trustee(s) shall provide or cause to be provided on a timely
basis to each Holder any Internal Revenue Service form required to be so
provided in respect of the Trust Securities.
ARTICLE V
Trust Securities Certificates
Section 5.01 Initial Ownership. Upon the formation of the Trust by the
contribution by the Depositor pursuant to Section 2.03 and until the issuance
of the Trust Securities, and at any time during which no Trust Securities are
outstanding, the Depositor shall be the sole beneficial owner of the Trust.
Section 5.02 The Trust Securities Certificates. Each of the Preferred and
Common Securities Certificates shall be issued in minimum denominations of $
and integral multiples in excess thereof. The Trust Securities Certificates
shall be executed on behalf of the Trust by manual or facsimile signature of at
least one Administrative Trustee. Trust Securities Certificates bearing the
manual or facsimile signatures of individuals who were, at the time when such
signatures shall have been affixed, authorized to sign on behalf of the Trust,
shall be validly issued and entitled to the benefits of this Trust Agreement,
notwithstanding that such individuals or any of them shall have ceased to be so
authorized prior to the authentication and delivery of such Trust Securities
Certificates or did not hold such offices at the date of authentication and
delivery of such Trust
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Securities Certificates. A transferee of a Trust Securities Certificate shall
become a Securityholder, and shall be entitled to the rights and subject to the
obligations of a Securityholder hereunder, upon due registration of such Trust
Securities Certificate in such transferee's name pursuant to Section 5.04.
Section 5.03 Authentication of Trust Securities Certificates. On the Issue
Date, the Administrative Trustees shall cause Trust Securities Certificates, in
an aggregate Liquidation Amount as provided in Sections 2.04 and 2.05, to be
executed on behalf of the Trust, authenticated and delivered to or upon the
written order of the Depositor signed by its Chairman of the Board, its
President or any Vice President, without further corporate action by the
Depositor, in authorized denominations. No Trust Securities Certificate shall
entitle its Holder to any benefit under this Trust Agreement, or shall be valid
for any purpose, unless there shall appear on such Trust Securities Certificate
a certificate of authentication substantially in the form set forth in Exhibit
E or Exhibit C, as applicable, executed by at least one Administrative Trustee
by manual signature; such authentication shall constitute conclusive evidence
that such Trust Securities Certificate shall have been duly authenticated and
delivered hereunder. All Trust Securities Certificates shall be dated the date
of their authentication.
Section 5.04 Registration of Transfer and Exchange of Preferred Securities
Certificates. The Security Registrar shall keep or cause to be kept, at the
office or agency maintained pursuant to Section 5.08, a Security Register in
which, subject to such reasonable regulations as it may prescribe, the Security
Registrar shall provide for the registration of Preferred Securities
Certificates and the Common Securities Certificates (subject to Section 5.10 in
the case of the Common Securities Certificates) and registration of transfers
and exchanges of Preferred Securities Certificates as herein provided. The
Property Trustee shall be the initial Security Registrar.
Upon surrender for registration of transfer of any Preferred Securities
Certificate at the office or agency maintained pursuant to Section 5.08, the
Administrative Trustees shall execute, authenticate and deliver in the name of
the designated transferee or transferees, one or more new Preferred Securities
Certificates in authorized denominations of a like aggregate Liquidation Amount
dated the date of authentication by the Administrative Trustee or Trustees. The
Security Registrar shall not be required to register the transfer of any
Preferred Securities that have been called for redemption. At the option of a
Holder, Preferred Securities Certificates may be exchanged for other Preferred
Securities Certificates in authorized denominations of the same class and of a
like aggregate Liquidation Amount upon surrender of the Preferred Securities
Certificates to be exchanged at the office or agency maintained pursuant to
Section 5.08.
Every Preferred Securities Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Administrative Trustees and
the Security Registrar duly executed by the Holder or such Holder's attorney
duly authorized in writing. Each Preferred Securities Certificate surrendered
for registration of transfer or exchange shall be cancelled and subsequently
disposed of by the Security Registrar in accordance with its customary
practice.
No service charge shall be made for any registration of transfer or exchange of
Preferred Securities Certificates, but the Security Registrar or the
Administrative Trustees may require payment of a sum
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sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Preferred Securities Certificates.
Section 5.05 Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates. If (a) any mutilated Trust Securities Certificate shall be
surrendered to the Security Registrar, or if the Security Registrar shall
receive evidence to its satisfaction of the destruction, loss or theft of any
Trust Securities Certificate and (b) there shall be delivered to the Security
Registrar and the Administrative Trustees such security or indemnity as may be
required by them to save each of them harmless, then in the absence of notice
that such Trust Securities Certificate shall have been acquired by a bona fide
purchaser, the Administrative Trustees or any one of them on behalf of the
Trust shall execute and authenticate and make available for delivery, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen Trust
Securities Certificate, a new Trust Securities Certificate of like class, tenor
and denomination. In connection with the issuance of any new Trust Securities
Certificate under this Section, the Administrative Trustees or the Security
Registrar may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection therewith. Any duplicate
Trust Securities Certificate issued pursuant to this Section shall constitute
conclusive evidence of an ownership interest in the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Trust Securities
Certificate shall be found at any time.
Section 5.06 Persons Deemed Securityholders. Prior to due presentation of a
Trust Securities Certificate for registration of transfer, the Trustees or the
Security Registrar shall treat the Person in whose name any Trust Securities
Certificate shall be registered in the Security Register as the owner of such
Trust Securities Certificate for the purpose of receiving Distributions
(subject to Section 4.01(d)) and for all other purposes whatsoever, and neither
the Trustees nor the Security Registrar shall be bound by any notice to the
contrary.
Section 5.07 Access to List of Securityholders' Names and Addresses. The
Administrative Trustees shall furnish or cause to be furnished to (i) the
Depositor and the Property Trustee semi-annually, not later than June 1 and
December 1 in each year and (ii) the Depositor or the Property Trustee, as the
case may be, within 30 days after receipt by any Administrative Trustee of a
request therefor from the Depositor or the Property Trustee, as the case may
be, in writing, a list, in such form as the Depositor or the Property Trustee,
as the case may be, may reasonably require, of the names and addresses of the
Securityholders as of a date not more than 15 days prior to the time such list
is furnished; provided that the Administrative Trustees shall not be obligated
to provide such list at any time such list does not differ from the most recent
list given to the Depositor and the Property Trustee by the Administrative
Trustees or at any time the Property Trustee is the Security Registrar. If
three or more Securityholders or one or more Holders of Trust Securities
Certificates evidencing not less than 25% of the outstanding Liquidation Amount
apply in writing to the Administrative Trustees, and such application states
that the applicants desire to communicate with other Securityholders with
respect to their rights under this Trust Agreement or under the Trust
Securities Certificates and such application is accompanied by a copy of the
communication that such applicants propose to transmit, then the Administrative
Trustees shall, within five Business Days after the receipt of such
application, afford such applicants access during normal business hours to the
current list of Securityholders. Each Holder, by receiving and holding a Trust
Securities Certificate, shall be deemed to have agreed not to hold either the
Depositor or the Administrative Trustees
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accountable by reason of the disclosure of its name and address, regardless of
the source from which such information was derived.
Section 5.08 Maintenance of Office or Agency. The Administrative Trustees shall
maintain in the Borough of Manhattan, New York, an office or offices or agency
or agencies where Preferred Securities Certificates may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Trustees in respect of the Trust Securities Certificates may be served. The
Administrative Trustees initially designate The Chase Manhattan Bank, 450 West
33rd Street, New York, New York 10001 as the principal agency for such
purposes. The Administrative Trustees shall give prompt written notice to the
Depositor and to the Securityholders of any change in the location of the
Security Register or any such office or agency.
Section 5.09 Appointment of Paying Agent. The Paying Agent shall make
Distributions and other payments provided hereby to Securityholders from the
Payment Account and shall report the amounts of such Distributions and payments
to the Property Trustee and the Administrative Trustees. Any Paying Agent shall
have the revocable power to withdraw funds from the Payment Account for the
purpose of making the Distributions and payments provided hereby. The
Administrative Trustees may revoke such power and remove the Paying Agent if
such Trustees determine in their sole discretion that the Paying Agent shall
have failed to perform its obligations under this Trust Agreement in any
material respect. The Paying Agent shall initially be the Property Trustee, and
it may choose any co-paying agent that is acceptable to the Administrative
Trustees and the Depositor. Any Person acting as Paying Agent shall be
permitted to resign as Paying Agent upon 30 days' written notice to the
Administrative Trustees and the Depositor. In the event that a Paying Agent
shall resign or be removed, the Administrative Trustees shall appoint a
successor that is acceptable to the Depositor to act as Paying Agent (which
shall be a bank or trust company). The Administrative Trustees shall cause such
successor Paying Agent or any additional Paying Agent appointed by the
Administrative Trustees to execute and deliver to the Trustees an instrument in
which such successor Paying Agent or additional Paying Agent shall agree with
the Trustees that as Paying Agent, such successor Paying Agent or additional
Paying Agent will hold all sums, if any, held by it for payment to the
Securityholders in trust for the benefit of the Securityholders entitled
thereto until such sums shall be paid to such Securityholders. The Paying Agent
shall return all unclaimed funds to the Property Trustee and upon removal of a
Paying Agent such Paying Agent shall also return all funds in its possession to
the Property Trustee. The provisions of Sections 8.01, 8.03 and 8.06 shall
apply to the Property Trustee also in its role as Paying Agent, for so long as
the Property Trustee shall act as Paying Agent and, to the extent applicable,
to any other paying agent appointed hereunder. Any reference in this Agreement
to the Paying Agent shall include any co-paying agent unless the context
requires otherwise.
Section 5.10 Ownership of Common Securities by Depositor. On the Issue Date,
the Depositor shall acquire, and thereafter retain, beneficial and record
ownership of the Common Securities. Any attempted transfer of the Common
Securities, except for transfers by operation of law or to an Affiliate of the
Depositor or a permitted successor under Section 801 of the Subordinated
Indenture, shall be void. The Administrative Trustees shall cause each Common
Securities Certificate issued to the Depositor and its permitted transferees to
contain a legend stating "THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT AS
PROVIDED IN THE TRUST AGREEMENT REFERRED TO HEREIN."
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Section 5.11 Book-Entry Preferred Securities Certificates; Common Securities
Certificate.
(a) The Preferred Securities Certificates, upon original issuance, will be
issued in the form of a typewritten Preferred Securities Certificate or
Certificates representing Book-Entry Preferred Securities Certificates, to be
delivered to The Depository Trust Company, the initial Clearing Agency, by, or
on behalf of, the Trust. Such Preferred Securities Certificate or Certificates
shall initially be registered on the Security Register in the name of Cede &
Co., the nominee of the initial Clearing Agency, and no Owner will receive a
definitive Preferred Securities Certificate representing such beneficial
owner's interest in such Preferred Securities, except as provided in Section
5.13. Unless and until Definitive Preferred Securities Certificates have been
issued to Owners pursuant to Section 5.13:
(i) the provisions of this Section 5.11(a) shall be in full force and
effect;
(ii) the Security Registrar and the Trustees shall be entitled to deal with
the Clearing Agency for all purposes of this Trust Agreement relating to
the Book-Entry Preferred Securities Certificates (including the payment of
principal of and interest on the Book-Entry Preferred Securities and the
giving of instructions or directions to Owners of Book-Entry Preferred
Securities) as the sole Holder of Book-Entry Preferred Securities and shall
have no obligations to the Owners thereof;
(iii) to the extent that the provisions of this Section conflict with any
other provisions of this Trust Agreement, the provisions of this Section
shall control;
(iv) the rights of the Owners of the Book-Entry Preferred Securities
Certificates shall be exercised only through the Clearing Agency and shall
be limited to those established by law and agreements between such Owners
and the Clearing Agency and/or the Clearing Agency Participants. Pursuant
to the Certificate Depository Agreement, unless and until Definitive
Preferred Securities Certificates are issued pursuant to Section 5.13, the
Clearing Agency will make book-entry transfers among the Clearing Agency
Participants and receive and transmit payments on the Preferred Securities
to such Clearing Agency Participants; and
(v) whenever this Trust Agreement requires or permits actions to be taken
based upon instructions or directions of Holders of Trust Securities
Certificates evidencing a specified percentage of the aggregate Liquidation
Amount, the Clearing Agency shall be deemed to represent such percentage
only to the extent that it has received instructions to such effect from
Owners and/or Clearing Agency Participants owning or representing,
respectively, such required percentage of the beneficial interest in the
applicable class of Trust Securities Certificates and has delivered such
instructions to the Trustees.
(b) A single Common Securities Certificate representing the Common Securities
shall be issued to the Depositor in the form of a definitive Common Securities
Certificate.
Section 5.12 Notices to Clearing Agency. To the extent a notice or other
communication to the Owners is required under this Trust Agreement, unless and
until Definitive Preferred Securities Certificates shall have been issued to
Owners pursuant to Section 5.13, the Trustees shall give all such notices and
communications specified herein to be given to Owners to the Clearing Agency,
and shall have no obligations to the Owners.
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Section 5.13 Definitive Preferred Securities Certificates. If (i) the Depositor
advises the Trustees in writing that the Clearing Agency is no longer willing
or able to properly discharge its responsibilities with respect to the
Preferred Securities Certificates, and the Depositor is unable to locate a
qualified successor within 90 days of receipt by the Depositor of such written
advice, or (ii) the Depositor at its option advises the Trustees in writing
that it elects to terminate the book-entry system through the Clearing Agency,
then the Administrative Trustees shall notify the Clearing Agency and Holders
of the Preferred Securities. Upon surrender to the Administrative Trustees of
the typewritten Preferred Securities Certificate or Certificates representing
the Book-Entry Preferred Securities Certificates by the Clearing Agency,
accompanied by registration instructions, the Administrative Trustees or any
one of them shall execute and authenticate the Definitive Preferred Securities
Certificates in accordance with the instructions of the Clearing Agency.
Neither the Security Registrar nor the Trustees shall be liable for any delay
in delivery of such instructions and may conclusively rely on, and shall be
protected in relying on, such instructions. Upon the issuance of Definitive
Preferred Securities Certificates, the Trustees shall recognize the Holders of
the Definitive Preferred Securities Certificates as Securityholders. The
Definitive Preferred Securities Certificates shall be printed, lithographed or
engraved or may be produced in any other manner as is reasonably acceptable to
the Administrative Trustees, as evidenced by the execution thereof by the
Administrative Trustees or any one of them.
Section 5.14 Rights of Securityholders. The legal title to the Trust Property
is vested exclusively in the Property Trustee (in its capacity as such) in
accordance with Section 2.09, and the Securityholders shall not have any right
or title therein other than the undivided beneficial ownership interest in the
assets of the Trust conferred by their Trust Securities, and they shall have no
right to call for any partition or division of property, profits or rights of
the Trust except as described below. The Trust Securities shall be personal
property giving only the rights specifically set forth therein and in this
Trust Agreement. The Trust Securities shall have no preemptive or other similar
rights and when issued and delivered to Securityholders against payment of the
purchase price therefor will be fully paid and nonassessable by the Trust.
Except as otherwise provided in the Expense Agreement and Section 10.01 hereof
with respect to the Depositor, the Holders of the Trust Securities shall 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.
ARTICLE VI
Acts of Securityholders; Meetings; Voting
Section 6.01 Limitations on Voting Rights.
(a) Except as provided in this Section, in Section 8.10 or Section 10.03 of
this Trust Agreement, in the Subordinated Indenture, and as otherwise required
by law, no Holder of Preferred Securities shall have any right to vote or in
any manner otherwise control the administration, operation and management of
the Trust or the obligations of the parties hereto, nor shall anything herein
set forth, or contained in the terms of the Trust Securities Certificates, be
construed so as to constitute the Securityholders from time to time as partners
or members of an association.
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(b) So long as any Junior Subordinated Notes 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 Indenture Trustee, or executing any
trust or power conferred on the Indenture Trustee with respect to such Junior
Subordinated Notes, (ii) consent to waive any past default which is waivable
under Section 513 of the Subordinated Indenture, (iii) exercise any right to
rescind or annul a declaration that the principal of all the Junior
Subordinated Notes shall be due and payable or (iv) consent to any amendment,
modification or termination of the Subordinated Indenture or the Junior
Subordinated Notes, where such consent shall be required, or to any other
action, as holder of the Junior Subordinated Notes, under the Subordinated
Indenture, without, in each case, obtaining the prior approval of the Holders
of at least 66 2/3% in Liquidation Amount of the Outstanding Preferred
Securities; provided, however, that where a consent under the Subordinated
Indenture would require the consent of each holder of Junior Subordinated Notes
affected thereby, no such consent shall be given by the Trustees without the
prior written consent of each Holder of Preferred Securities. The Trustees
shall not revoke any action previously authorized or approved by a vote of the
Holders of Preferred Securities, except pursuant to a subsequent vote of the
Holders of Preferred Securities. The Property Trustee shall notify all Holders
of the Preferred Securities of any notice of default received from the
Indenture Trustee with respect to the Junior Subordinated Notes.
(c) If any proposed amendment to the Trust Agreement provides for, or the
Trustees otherwise propose to effect, (i) any action that would adversely
affect the powers, preferences or special rights of the Preferred Securities,
whether by way of amendment to this Trust Agreement or otherwise, or (ii) the
dissolution, winding-up or termination of the Trust, other than pursuant to the
terms of this Trust Agreement, then the Holders of Outstanding Preferred
Securities as a class will be entitled to vote on such amendment or proposal
and such amendment or proposal shall not be effective except with the approval
of the Holders of at least 66 2/3% in Liquidation Amount of the Outstanding
Preferred Securities.
Section 6.02 Notice of Meetings. Notice of all meetings of the Preferred
Securityholders, stating the time, place and purpose of the meeting, shall be
given by the Administrative Trustees pursuant to Section 10.08 to each
Preferred Securityholder of record, at his registered address, at least 15 days
and not more than 90 days before the meeting. At any such meeting, any business
properly before the meeting may be so considered whether or not stated in the
notice of the meeting. Any adjourned meeting may be held as adjourned without
further notice. Any and all notice to which any Preferred Securityholder
hereunder may be entitled and any and all communications shall be deemed duly
served or given if mailed, postage prepaid, addressed to any Preferred
Securityholders of record at his last known address as recorded on the Security
Register.
Section 6.03 Meetings of Preferred Securityholders. No annual meeting of
Securityholders is required to be held. The Administrative Trustees, however,
shall call a meeting of Securityholders to vote on any matter upon the written
request of the Preferred Securityholders of record of 25% of the Preferred
Securities (based upon their Liquidation Amount) and the Administrative
Trustees or the Property Trustee may, at any time in their discretion, call a
meeting of Preferred Securityholders to vote on any matters as to which
Preferred Securityholders are entitled to vote.
Preferred Securityholders of record of 50% of the Preferred Securities (based
upon their Liquidation Amount), present in person or by proxy, shall constitute
a quorum at any meeting of Securityholders.
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If a quorum is present at a meeting, an affirmative vote by the Preferred
Securityholders of record present, in person or by proxy, holding more than 66
2/3% of the Preferred Securities (based upon their Liquidation Amount) held by
the Preferred Securityholders of record present, either in person or by proxy,
at such meeting shall constitute the action of the Securityholders, unless this
Trust Agreement requires a greater proportion of affirmative votes.
Section 6.04 Voting Rights. Securityholders shall be entitled to one vote for
each $ of Liquidation Amount represented by their Trust Securities in respect
of any matter as to which such Securityholders are entitled to vote.
Section 6.05 Proxies, etc. At any meeting of Securityholders, any
Securityholder entitled to vote may vote by proxy, provided that no proxy shall
be voted at any meeting unless it shall have been placed on file with the
Administrative Trustees, or with such other officer or agent of the Trust as
the Administrative Trustees may direct, for verification prior to the time at
which such vote shall be taken. Pursuant to a resolution of the Property
Trustee, proxies may be solicited in the name of the Property Trustee or one or
more officers of the Property Trustee. Only Securityholders of record shall be
entitled to vote. When Trust Securities are held jointly by several Persons,
any one of them may vote at any meeting in person or by proxy in respect of
such Trust Securities, but if more than one of them shall be present at such
meeting in person or by proxy, and such joint owners or their proxies so
present disagree as to any vote to be cast, such vote shall not be received in
respect of such Trust Securities. A proxy purporting to be executed by or on
behalf of a Securityholder shall be deemed valid unless challenged at or prior
to its exercise, and the burden of proving invalidity shall rest on the
challenger. No proxy shall be valid more than three years after its date of
execution.
Section 6.06 Securityholder Action by Written Consent. Any action which may be
taken by Securityholders at a meeting may be taken without a meeting if
Securityholders holding at least 66 2/3% of all outstanding Trust Securities
entitled to vote in respect of such action (or such other proportion thereof as
shall be required by any express provision of this Trust Agreement) shall
consent to the action in writing (based upon their Liquidation Amount).
Section 6.07 Record Date for Voting and Other Purposes. For the purposes of
determining the Securityholders who are entitled to notice of and to vote at
any meeting or by written consent, or to participate in any Distribution on the
Trust Securities in respect of which a record date is not otherwise provided
for in this Trust Agreement, or for the purpose of any other action, the
Administrative Trustees may from time to time fix a date, not more than 90 days
prior to the date of any meeting of Securityholders or the payment of
distribution or other action, as the case may be, as a record date for the
determination of the identity of the Securityholders of record for such
purposes.
Section 6.08 Acts of Securityholders. Any request, demand, authorization,
direction, notice, consent, waiver or other action provided or permitted by
this Trust Agreement to be given, made or taken by Securityholders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Securityholders in person or by an agent appointed in
writing; and, except as otherwise expressly provided herein, such action shall
become effective when such instrument or instruments are delivered to the
Administrative Trustees. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Securityholders signing such instrument or instruments. Proof of
execution of
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any such instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Trust Agreement and (subject to Section
8.01) conclusive in favor of the Trustees, if made in the manner provided in
this Section.
The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgements of deeds, certifying that the individual signing such
instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustees deem sufficient.
The ownership of Preferred Securities shall be proved by the Security Register.
Any request, demand, authorization, direction, notice, consent, waiver or other
Act of the Securityholder of any Trust Security shall bind every future
Securityholder of the same Trust Security and the Securityholder of every Trust
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
Without limiting the foregoing, a Securityholder entitled hereunder to take any
action hereunder with regard to any particular Trust Security may do so with
regard to all or any part of the Liquidation Amount of such Trust Security or
by one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such Liquidation Amount.
If any dispute shall arise between the Holders of Trust Securities and the
Administrative Trustees or among such Securityholders or Trustees with respect
to the authenticity, validity or binding nature of any request, demand,
authorization, direction, consent, waiver or other Act of such Securityholder
or Trustee under this Article VI, then the determination of such matter by the
Property Trustee shall be conclusive with respect to such matter.
Section 6.09 Inspection of Records. Upon reasonable notice to the Trustees, the
records of the Trust shall be open to inspection by Securityholders during
normal business hours for any purpose reasonably related to such
Securityholder's interest as a Securityholder.
ARTICLE VII
Representations and Warranties of the Property Trustee and Delaware Trustee
Section 7.01 Representations and Warranties of the Property Trustee and
Delaware Trustee. The Bank, the Delaware Bank, the Property Trustee and the
Delaware Trustee, each on behalf of and as to itself, hereby represents and
warrants for the benefit of the Depositor and the Securityholders that:
(a) the Bank is a banking corporation or trust company duly organized,
validly existing and in good standing under the laws of the State of New
York, and the Delaware Trustee is a banking
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corporation or trust company duly organized, validly existing and in good
standing under the laws of the State of Delaware;
(b) each of the Bank and the Delaware Bank has full corporate power,
authority and legal right to execute, deliver and perform their obligations
under this Trust Agreement and has taken all necessary action to authorize
the execution, delivery and performance by it of this Trust Agreement;
(c) this Trust Agreement has been duly authorized, executed and delivered
by each of the Bank and the Delaware Bank and constitutes the valid and
legally binding agreement of each of the Bank and the Delaware Bank,
enforceable against it in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors' rights
and to general equity principles;
(d) the execution, delivery and performance by each of the Bank and the
Delaware Bank of this Trust Agreement have been duly authorized by all
necessary corporate action on the part of the Bank, Property Trustee, the
Delaware Bank and the Delaware Trustee and do not require any approval of
stockholders of the Bank or the Delaware Bank and such execution, delivery
and performance will not (i) violate the Bank's or the Delaware Bank's
charter or by-laws, or (ii) violate any law, governmental rule or
regulation of the United States or the State of New York or Delaware, as
the case may be, governing the banking or trust powers of the Bank and the
Property Trustee or the Delaware Bank and the Delaware Trustee, or any
order, judgment or decree applicable to the Bank, the Property Trustee, the
Delaware Bank or the Delaware Trustee; and
(e) neither the authorization, execution or delivery by the Bank or the
Delaware Bank of this Trust Agreement, nor the consummation of any of the
transactions by the Bank, the Property Trustee, the Delaware Bank or the
Delaware Trustee (as appropriate in context) contemplated herein or
therein, nor the issuance of the Trust Securities Certificates pursuant to
this Trust Agreement require the consent or approval of, the giving of
notice to, the registration with or the taking of any other action with
respect to any governmental authority or agency under any existing federal,
New York or Delaware law governing the banking or trust powers of the Bank
or the Delaware Bank.
Section 7.02 Representations and Warranties of Depositor.
The Depositor hereby represents and warrants for the benefit of the
Securityholders that:
(a) the Trust Securities Certificates issued at the Closing Date on behalf
of the Trust have been duly authorized and will have been, duly and validly
executed, issued and delivered by the Trustees pursuant to the terms and
provisions of, and in accordance with the requirements of, this Trust
Agreement and the Securityholders will be, as of such date, entitled to the
benefits of this Trust Agreement; and
(b) there are no taxes, fees or other governmental charges payable by the
Trust (or the Trustees on behalf of the Trust) under the laws of the State
of Delaware or any political subdivision thereof in connection with the
execution, delivery and performance by the Property Trustee or the Delaware
Trustee, as the case may be, of this Trust Agreement.
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ARTICLE VIII
The Trustees
Section 8.01 Certain Duties and Responsibilities.
(a) The rights, duties and responsibilities of the Trustees shall be as
provided by this Trust Agreement and the Delaware Business Trust Act (except
that the immunities and standard of care of the Property Trustee shall be
governed by New York law) and, in the case of the Property Trustee, the Trust
Indenture Act. Notwithstanding the foregoing, no provision of this Trust
Agreement shall require the Trustees to expend or risk their own funds or
otherwise incur any financial liability in the performance of any of their
duties hereunder, or in the exercise of any of their rights or powers, if they
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
them. Whether or not therein expressly so provided, every provision of this
Trust Agreement relating to the conduct or affecting the liability of or
affording protection to the Trustees shall be subject to the provisions of this
Section.
(b) All payments made by the Property Trustee in respect of the Trust
Securities shall be made only from the income and proceeds from the Trust
Property and only to the extent that there shall be sufficient income or
proceeds from the Trust Property to enable the Property Trustee to make
payments in accordance with the terms hereof. Each Securityholder, by its
acceptance of a Trust Security, agrees that it will look solely to the income
and proceeds from the Trust Property to the extent available for distribution
to it as herein provided and that the Trustees are not personally liable to it
for any amount distributable in respect of any Trust Security or for any other
liability in respect of any Trust Security. This Section 8.01(b) does not limit
the liability of the Trustees expressly set forth elsewhere in this Trust
Agreement or, in the case of the Property Trustee, in the Trust Indenture Act.
Section 8.02 Notice of Defaults. Within 90 days after the occurrence of any
default, the Property Trustee shall transmit, in the manner and to the extent
provided in Section 10.08, notice of any such default known to the Property
Trustee to the Securityholders, the Administrative Trustees and the Depositor,
unless such default shall have been cured or waived. For the purpose of this
Section, the term "default" means any event which is, or after notice or lapse
of time or both would become, an Event of Default.
Section 8.03 Certain Rights of Property Trustee. Subject to the provisions of
Section 8.01 and except as provided by law:
(i) the Property Trustee may rely and shall be protected in acting or
refraining from acting in good faith upon any resolution, Opinion of
Counsel, certificate, written representation of a Holder or transferee,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other
paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(ii) if (A) in performing its duties under this Trust Agreement the
Property Trustee is required to decide between alternative courses of
action, or (B) in construing any of the provisions in this Trust Agreement
the Property Trustee finds the same ambiguous or inconsistent with any
other
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provisions contained herein, or (C) the Property Trustee is unsure of the
application of any provision of this Trust Agreement, then, except as to
any matter as to which the Preferred Securityholders are entitled to vote
under the terms of this Trust Agreement, the Property Trustee shall deliver
a notice to the Depositor requesting written instructions of the Depositor
as to the course of action to be taken. The Property Trustee shall take
such action, or refrain from taking such action, as the Property Trustee
shall be instructed in writing to take, or to refrain from taking, by the
Depositor; provided, however, that if the Property Trustee does not receive
such instructions of the Depositor within ten Business Days after it has
delivered such notice, or such reasonably shorter period of time set forth
in such notice (which to the extent practicable shall not be less than two
Business Days), it may, but shall be under no duty to, take or refrain from
taking such action not inconsistent with this Trust Agreement as it shall
deem advisable and in the best interests of the Securityholders, in which
event the Property Trustee shall have no liability except for its own bad
faith, negligence or willful misconduct;
(iii) the Property Trustee may consult with counsel of its selection and
the written advice of such counsel or any Opinion of Counsel shall be full
and complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance thereon;
(iv) the Property Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Trust Agreement at the request or
direction of any of the Securityholders pursuant to this Trust Agreement,
unless such Securityholders shall have offered to the Property Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such request
or direction;
(v) 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, consent, order, approval,
bond or other document, unless requested in writing to do so by one or more
Securityholders; and
(vi) the Property Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through its agents
or attorneys, provided that the Property Trustee shall be responsible for
its own negligence or recklessness with respect to selection of any agent
or attorney appointed by it hereunder.
Section 8.04 Not Responsible for Recitals or Issuance of Securities. The
recitals contained herein and in the Trust Securities Certificates shall be
taken as the statements of the Trust, and the Trustees do not assume any
responsibility for their correctness. The Trustees shall not be accountable for
the use or application by the Trust of the proceeds of the Trust Securities in
accordance with Section 2.05.
The Property Trustee may conclusively assume that any funds held by it
hereunder are legally available unless an officer of the Property Trustee
assigned to its Corporate Trustee Administrative Department shall have received
written notice from the Corporation, any Holder or any other Trustee that such
funds are not legally available.
Section 8.05 May Hold Securities. Except as provided in the definition of the
term "Outstanding" in Article I, any Trustee or any other agent of the Trustees
or the Trust, in its
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individual or any other capacity, may become the owner or pledgee of Trust
Securities and may otherwise deal with the Trust with the same rights it would
have if it were not a Trustee or such other agent.
Section 8.06 Compensation; Fees; Indemnity.
The Depositor agrees:
(1) to pay to the Trustees from time to time reasonable compensation for
all services rendered by the Trustees hereunder (which compensation shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustees upon request for all reasonable expenses, disbursements and
advances incurred or made by the Trustees in accordance with any provision
of this Trust Agreement (including the reasonable compensation and the
expenses and disbursements of their agents and counsel), except any such
expense, disbursement or advance as may be attributable to their
negligence, willful misconduct or bad faith; and
(3) to indemnify the Trustees for, and to hold the Trustees harmless
against, any and all loss, damage, claims, liability or expense incurred
without negligence, willful misconduct or bad faith on their part, arising
out of or in connection with the acceptance or administration of this Trust
Agreement, including the costs and expenses of defending themselves against
any claim or liability in connection with the exercise or performance of
any of its powers or duties hereunder.
The provisions of this Section 8.06 shall survive the termination of this Trust
Agreement.
Section 8.07 Trustees Required; Eligibility.
(a) There shall at all times be a Property Trustee hereunder with respect to
the Trust Securities. The Property Trustee shall be a Person that has a
combined capital and surplus of at least $50,000,000. If any such Person
publishes reports of condition at least annually, pursuant to law or to the
requirements of its supervising or examining authority, then for the purposes
of this Section, the combined capital and surplus of such Person shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Property Trustee with
respect to the Trust Securities shall cease to be eligible in accordance with
the provisions of this Section, it shall resign immediately in the manner and
with the effect hereinafter specified in this Article.
(b) There shall at all times be one or more Administrative Trustees hereunder
with respect to the Trust Securities. Each Administrative 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 persons authorized to bind such entity.
(c) There shall at all times be a Delaware Trustee with respect to the Trust
Securities. The Delaware Trustee shall either be (i) a natural person who is at
least 21 years of age and a resident of the State of Delaware or (ii) a legal
entity authorized to conduct a trust business and with its principal place of
business in the State of Delaware that shall act through one or more persons
authorized to bind such entity.
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Section 8.08 Conflicting Interests.
If the Property Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Property Trustee shall either eliminate
such interest or resign, to the extent and in the manner provided by, and
subject to the provisions of, the Trust Indenture Act and this Trust Agreement.
To the extent permitted by the Trust Indenture Act, the Property Trustee shall
not be deemed to have a conflicting interest by virtue of being trustee under
the Guarantee, the Guarantee Agreements dated as of June 1, 1998 and September
15, 1998, between the Depositor, as guarantor, and The Chase Manhattan Bank, as
trustee, and the Amended and Restated Trust Agreements dated as of June 1, 1998
and September 15, 1998, among the Depositor, as depositor, Chase Manhattan Bank
Delaware, as Delaware trustee, Robert T. Lucas III and S.L. Love, as
administrative trustees, and The Chase Manhattan Bank, as property trustee.
Section 8.09 Co-Property Trustees and Separate Trustee.
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
Property may at the time be located, the Holder of the Common Securities and
the Property Trustee shall have power to appoint, and upon the written request
of the Property Trustee, the Depositor shall for such purpose join with the
Property Trustee in the execution, delivery and performance of all instruments
and agreements necessary or proper to appoint, one or more Persons approved by
the Property Trustee either to act as co-property trustee, jointly with the
Property Trustee, of all or any part of such Trust Property, or to act as
separate trustee of any such Trust 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 the capacity aforesaid, any property, title, right or power deemed
necessary or desirable, subject to the other provisions of this Agreement. If
the Depositor does not join in such appointment within 15 days after the
receipt by it of a request so to do, or in case an Indenture Event of Default
has occurred and is continuing, the Property Trustee alone shall have power to
make such appointment. Any co-property trustee or separate trustee appointed
pursuant to this Section shall satisfy the requirements of Section 8.07.
Should any written instrument from the Depositor be required by any co-property
trustee or separate trustee so appointed for more fully confirming to such co-
property trustee or separate trustee such property, title, right, or power, any
and all such instruments shall, on request, be executed, acknowledged, and
delivered by the Depositor.
Every co-property trustee or separate trustee shall, to the extent permitted by
law, but to such extent only, be appointed subject to the following terms,
namely:
(i) The Trust Securities shall be executed, authenticated and delivered and
all rights, powers, duties, and obligations hereunder in respect of the
custody of securities, cash and other personal property held by, or
required to be deposited or pledged with, the Trustees hereunder, shall be
exercised, solely by the Trustees.
(ii) The rights, powers, duties, and obligations hereby conferred or
imposed upon the Property Trustee in respect of any property covered by
such appointment shall be conferred or imposed upon and exercised or
performed by the Property Trustee or by the Property Trustee and such co-
property trustee or separate trustee jointly, as shall be provided in the
instrument appointing such co-property trustee or separate trustee, except
to the extent that under any law of any
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jurisdiction in which any particular act is to be performed, the Property
Trustee shall be incompetent or unqualified to perform such act, in which
event such rights, powers, duties, and obligations shall be exercised and
performed by such co-property trustee or separate trustee.
(iii) The Property Trustee at any time, by an instrument in writing
executed by it, with the written concurrence of the Depositor, may accept
the resignation of or remove any co-property trustee or separate trustee
appointed under this Section, and, in case an Indenture Event of Default
has occurred and is continuing, the Property Trustee shall have power to
accept the resignation of, or remove, any such co-property trustee or
separate trustee without the concurrence of the Depositor. Upon the written
request of the Property Trustee, the Depositor shall join with the Property
Trustee in the execution, delivery, and performance of all instruments and
agreements necessary or proper to effectuate such resignation or removal. A
successor to any co-property trustee or separate trustee so resigned or
removed may be appointed in the manner provided in this Section.
(iv) No co-property trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Property Trustee,
or any other such trustee hereunder.
(v) The Trustees shall not be liable by reason of any act of a co-property
trustee or separate trustee.
(vi) Any Act of Holders delivered to the Property Trustee shall be deemed
to have been delivered to each such co-property trustee and separate
trustee.
Section 8.10 Resignation and Removal; Appointment of Successor.
No resignation or removal of any Trustee (the "Relevant Trustee") and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 8.11.
Subject to the immediately preceding paragraph, the Relevant Trustee may resign
at any time by giving written notice thereof to the Holders. If the instrument
of acceptance by the successor Trustee required by Section 8.11 shall not have
been delivered to the Relevant Trustee within 30 days after the giving of such
notice of resignation, the resigning Relevant Trustee may petition, at the
expense of the Trust, any court of competent jurisdiction for the appointment
of a successor Relevant Trustee.
Unless an Indenture Event of Default shall have occurred and be continuing, any
Trustee may be removed at any time by Act of the Holder of the Common
Securities. If an Indenture Event of Default shall have occurred and be
continuing, the Property Trustee or the Delaware Trustee, or both of them, may
be removed at such time by Act of the Holders of a majority in Liquidation
Amount of the Preferred Securities, delivered to the Relevant Trustee (in its
individual capacity and on behalf of the Trust). An Administrative Trustee may
be removed by the Holder of the Common Securities at any time. In no event will
the Holders of the Preferred Securities have a right to vote to appoint, remove
or replace the Administrative Trustees.
If any Trustee shall resign, be removed or become incapable of continuing to
act as Trustee, or if a vacancy shall occur in the office of any Trustee for
any reason, at a time when no Indenture Event of Default shall have occurred
and be continuing, the Holder of the Common Securities, by Act of the
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Holder of the Common Securities, shall promptly appoint a successor Trustee or
successor Trustees, and the retiring Trustee shall comply with the applicable
requirements of Section 8.11. If the Property Trustee or the Delaware Trustee
shall resign, be removed or become incapable of continuing to act as the
Property Trustee or the Delaware Trustee, as the case may be, or a vacancy
shall occur in the office of any such Trustee for any reason, at a time when an
Indenture Event of Default shall have occurred and be continuing, the Holders
of Preferred Securities, by Act of the Holders of a majority in Liquidation
Amount of the Preferred Securities then Outstanding, shall promptly appoint a
successor Relevant Trustee or Relevant Trustees and such successor Relevant
Trustee or Relevant Trustees shall comply with the applicable requirements of
Section 8.11. If an Administrative Trustee shall resign, be removed or become
incapable of acting as Administrative Trustee, or a vacancy shall occur in the
office of any such Trustee for any reason, at a time when an Indenture Event of
Default shall have occurred and be continuing, the Holder of the Common
Securities, by Act of the Holder of the Common Securities, shall promptly
appoint a successor Administrative Trustee or Administrative Trustees and such
successor Administrative Trustee or Administrative Trustees shall comply with
the applicable requirements of Section 8.11. If no successor Relevant Trustee
shall have been so appointed in accordance with this Section 8.10 and accepted
appointment in the manner required by Section 8.11, any Holder who has been a
Holder of Trust Securities for at least six months may, on behalf of himself
and all others similarly situated, petition any court of competent jurisdiction
for the appointment of a successor Relevant Trustee.
The Property Trustee shall give notice of each resignation and each removal of
a Trustee and each appointment of a successor Trustee to all Holders in the
manner provided in Section 10.08 and shall give notice to the Depositor. Each
notice shall include the name of the successor Relevant Trustee and the address
of its Corporate Trust Office if it is the Property Trustee.
Notwithstanding the foregoing or any other provision of this Trust Agreement,
in the event any Administrative Trustee or a Delaware Trustee who is a natural
person dies or becomes, in the opinion of the Depositor, incompetent or
incapacitated, the vacancy created by such death, incompetence or incapacity
may be filled by (i) the act of the remaining Administrative Trustee or (ii)
otherwise by the Depositor (with the successor in each case being a Person who
satisfies the eligibility requirements for an Administrative Trustee or a
Delaware Trustee, as the case may be, set forth in Section 8.07).
Section 8.11 Acceptance of Appointment by Successor. In case of the appointment
hereunder of a successor Relevant Trustee, every such successor Relevant
Trustee so appointed shall execute, acknowledge and deliver to the Trust and to
the retiring Relevant Trustee an instrument accepting such appointment, and
thereupon the resignation or removal of the retiring Relevant Trustee shall
become effective and such successor Relevant Trustee, without any further act,
deed or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Relevant Trustee; but, on the request of the Depositor
or the successor Relevant Trustee, such retiring Relevant Trustee shall, upon
payment of its charges, execute and deliver an instrument transferring to such
successor Relevant Trustee all the rights, powers and trusts of the retiring
Relevant Trustee and shall duly assign, transfer and deliver to such successor
Relevant Trustee all property and money held by such retiring Relevant Trustee
hereunder.
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Upon request of any such successor Relevant Trustee, the Trust shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Relevant Trustee all such rights, powers and trusts referred
to in the preceding paragraph.
No successor Relevant Trustee shall accept its appointment unless at the time
of such acceptance such successor Relevant Trustee shall be qualified and
eligible under this Article.
Section 8.12 Merger, Conversion, Consolidation or Succession to Business. Any
Person into which the Property Trustee, Delaware Trustee or any Administrative
Trustee which is not a natural person may be merged or converted or with which
it may be consolidated, or any Person resulting from any merger, conversion or
consolidation to which such Relevant Trustee shall be a party, or any Person
succeeding to all or substantially all the corporate trust business of such
Relevant Trustee, shall be the successor of such Relevant Trustee hereunder,
provided such Person shall be otherwise qualified and eligible, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto.
Section 8.13 Preferential Collection of Claims Against Depositor or Trust. If
and when the Property Trustee shall be or become a creditor of the Depositor or
the Trust (or any other obligor upon the Junior Subordinated Notes or the Trust
Securities), the Property Trustee shall be subject to the provisions of the
Trust Indenture Act regarding the collection of claims against the Depositor or
Trust (or any such other obligor). For purposes of Section 311(b)(4) and (6) of
the Trust Indenture Act:
(a) "cash transaction" means any transaction in which full payment for
goods or securities sold is made within seven days after delivery of the
goods or securities in currency or in checks or other orders drawn upon
banks or bankers and payable upon demand; and
(b) "self-liquidating paper" means any draft, bill of exchange, acceptance
or obligation which is made, drawn, negotiated or incurred by the Depositor
or the Trust (or any such obligor) for the purpose of financing the
purchase, processing, manufacturing, shipment, storage or sale of goods,
wares or merchandise and which is secured by documents evidencing title to,
possession of, or a lien upon, the goods, wares or merchandise or the
receivables or proceeds arising from the sale of the goods, wares or
merchandise previously constituting the security, provided the security is
received by the Property Trustee simultaneously with the creation of the
creditor relationship with the Depositor or the Trust (or any such obligor)
arising from the making, drawing, negotiating or incurring of the draft,
bill of exchange, acceptance or obligation.
Section 8.14 Reports by the Property Trustee.
(a) Within 60 days after October 1 of each year commencing with October 1,
, if required by Section 313(a) of the Trust Indenture Act, the Property
Trustee shall transmit a brief report dated as of such October 1 with respect
to any of the events specified in such Section 313(a) that may have occurred
since the later of the date of this Trust Agreement or the preceding October 1.
(b) The Property Trustee shall transmit to Securityholders the reports required
by Section 313(b) of the Trust Indenture Act at the times specified therein.
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(c) Reports pursuant to this Section shall be transmitted in the manner and to
the Persons required by Sections 313(c) and (d) of the Trust Indenture Act.
Section 8.15 Reports to the Property Trustee. The Depositor and the
Administrative Trustees on behalf of the Trust shall provide to the Property
Trustee such documents, reports and information as required by Section 314 of
the Trust Indenture Act (if any) and, within 120 days after the end of each
fiscal year of the Depositor, the compliance certificate required by Section
314(a)(4) of the Trust Indenture Act in the form and in the manner required by
Section 314 of the Trust Indenture Act.
Section 8.16 Evidence of Compliance with Conditions Precedent. Each of the
Depositor and the Administrative Trustees on behalf of the Trust shall provide
to the Property Trustee such evidence of compliance with any conditions
precedent, if any, provided for in this Trust Agreement 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 pursuant to Section 314(c)(1) of
the Trust Indenture Act shall comply with Section 314(e) of the Trust Indenture
Act.
Section 8.17 Number of Trustees.
(a) The number of Trustees shall initially be four, provided that the Depositor
by written instrument may increase or decrease the number of Administrative
Trustees.
(b) If a Trustee ceases to hold office for any reason and the number of
Administrative Trustees is not reduced pursuant to Section 8.17(a), or if the
number of Trustees is increased pursuant to Section 8.17(a), a vacancy shall
occur. The vacancy shall be filled with a Trustee appointed in accordance with
Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy, incompetence or
incapacity to perform the duties of a Trustee shall not operate to 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 8.10, the Administrative Trustees in office, regardless
of their number (and notwithstanding any other provision of this Trust
Agreement), shall have all powers granted to the Administrative Trustees and
shall discharge the duties imposed upon the Administrative Trustees by this
Trust Agreement.
Section 8.18 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
2.07(A), 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 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 8.19 Enforcement of Rights of Property Trustee by Securityholders. If
an Indenture Event of Default occurs and is continuing, then (i) the Holders of
Preferred Securities will rely on the enforcement by the Property Trustee of
its rights against the Corporation as the holder of the Junior Subordinated
Notes and (ii) the Holders of a majority in aggregate Liquidation Amount of the
Preferred Securities will 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 under this Trust Agreement, including the right to direct the Property
Trustee to exercise the remedies available to it as a holder of the Junior
Subordinated Notes, provided that such direction shall not be in conflict with
any rule of law or with this Trust Agreement, and could not involve the
Property Trustee in personal liability in circumstances where reasonable
indemnity would not be adequate. If the Property Trustee fails to enforce its
rights under the Junior Subordinated Notes, a Holder of Preferred Securities
may, to the extent permitted by applicable law, institute a legal proceeding
against the Corporation to enforce its rights under this Trust Agreement
without first instituting any legal proceeding against the Property Trustee or
any other Person, including the Trust; it being understood and intended that no
one or more of such Holders shall have any right in any manner whatsoever by
virtue of, or by availing of, any provision of this Trust Agreement to affect,
disturb or prejudice the rights of any other of such Holders or to obtain or to
seek to obtain priority or preference over any other of such Holders or to
enforce any right under this Trust Agreement, except in the manner herein
provided and for the equal and ratable benefit of all such Holders.
Notwithstanding the foregoing, a Holder of Preferred Securities may institute a
legal proceeding directly against the Corporation without first instituting a
legal proceeding against or requesting or directing that action be taken by the
Property Trustee or any other Person, for enforcement of payment to such Holder
of principal of or interest on the Junior Subordinated Notes having a principal
amount equal to the aggregate stated Liquidation Amount of the Preferred
Securities of such Holder on or after the due dates therefor specified or
provided for in the Junior Subordinated Notes. The Corporation shall be
subrogated to all rights of the Holders of Preferred Securities in respect of
any amounts paid to such Holders by the Corporation pursuant to this Section.
Section 8.20 Delaware Trustee.
(a) Notwithstanding any other provision of this Trust Agreement, 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 Trust Agreement. The
Delaware Trustee shall be a trustee for the sole and limited purpose of
fulfilling the requirements of (S)3807 of the Delaware Business Trust Act.
(b) It is expressly understood and agreed by the parties hereto that in
fulfilling its obligations as Delaware Trustee hereunder on behalf of the Trust
(i) any agreements or instruments executed and delivered by Chase Manhattan
Bank Delaware are executed and delivered not in its individual capacity but
solely as Delaware Trustee under this Trust Agreement in the exercise of the
powers and authority conferred and vested in it, (ii) each of the
representations, undertakings and agreements herein made on the part of the
Trust is made and intended not as representations, warranties, covenants,
undertakings and agreements by Chase Manhattan Bank Delaware in its individual
capacity but is made and intended for the purpose of binding only the Trust,
and (iii) under no
37
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circumstances shall Chase Manhattan Bank Delaware in its individual capacity be
personally liable for the payment of any indebtedness or expenses of the Trust
or be liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken by the Trust under this Trust
Agreement, except if such breach or failure is due to any gross negligence or
willful misconduct of Chase Manhattan Bank Delaware as the Delaware Trustee.
ARTICLE IX
Termination and Liquidation
Section 9.01 Termination Upon Expiration Date. The Trust shall automatically
terminate on , (the "Expiration Date") or earlier pursuant to
Section 9.02.
Section 9.02 Early Termination. Upon the first to occur of any of the following
events (such first occurrence, an "Early Termination Event"), the Trust shall
be dissolved and terminated in accordance with the terms hereof:
(i) the occurrence of a Bankruptcy Event in respect of the Depositor,
dissolution or liquidation of the Depositor, or the dissolution of the
Trust pursuant to judicial decree;
(ii) the delivery of written direction to the Property Trustee by the
Depositor at any time (which direction is optional and wholly within the
discretion of the Depositor) to terminate the Trust and distribute the
Junior Subordinated Notes to Securityholders as provided in Section 9.04;
and
(iii) the payment at maturity or redemption of all of the Junior
Subordinated Notes, and the consequent payment of the Trust Securities.
Section 9.03 Termination. The respective obligations and responsibilities of
the Trust and the Trustees created hereby shall terminate upon the latest to
occur of the following: (a) the distribution by the Property Trustee to
Securityholders upon the liquidation of the Trust pursuant to Section 9.04, or
upon the redemption of all of the Trust Securities pursuant to Section 4.02, of
all amounts or instruments required to be distributed hereunder upon the final
payment of the Trust Securities; (b) the payment of any expenses owed by the
Trust; and (c) the discharge of all administrative duties of the Administrative
Trustees, including the performance of any tax reporting obligations with
respect to the Trust or the Securityholders.
Section 9.04 Liquidation.
(a) If any Early Termination Event specified in clause (ii) of Section 9.02
occurs, the Trust shall be liquidated and the Property Trustee shall distribute
the Junior Subordinated Notes to the Securityholders as provided in this
Section 9.04.
(b) In connection with a distribution of the Junior Subordinated Notes, each
Holder of Trust Securities shall be entitled to receive, after the satisfaction
of liabilities to creditors of the Trust (as evidenced by a certificate of the
Administrative Trustees), a Like Amount of Junior Subordinated Notes. Notice of
liquidation shall be given by the Trustees by first-class mail, postage
prepaid, mailed not later than 30 nor more than 60 days prior to the
Liquidation Date to each Holder of Trust Securities at such Holder's address
appearing in the Security Register. All notices of liquidation shall:
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<PAGE>
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the Trust Securities
will no longer be deemed to be Outstanding and any Trust Securities
Certificates not surrendered for exchange will be deemed to represent a
Like Amount of Junior Subordinated Notes; and
(iii) provide such information with respect to the mechanics by which
Holders may exchange Trust Securities Certificates for Junior Subordinated
Notes as the Administrative Trustees or the Property Trustee shall deem
appropriate.
(c) In order to effect the liquidation of the Trust and distribution of the
Junior Subordinated Notes to Securityholders, the Property Trustee shall
establish a record date for such distribution (which shall be not more than 45
days prior to the Liquidation Date) and, either itself acting as exchange agent
or through the appointment of a separate exchange agent, shall establish such
procedures as it shall deem appropriate to effect the distribution of Junior
Subordinated Notes in exchange for the Outstanding Trust Securities
Certificates.
(d) After the Liquidation Date, (i) the Trust Securities will no longer be
deemed to be Outstanding, (ii) certificates representing a Like Amount of
Junior Subordinated Notes will be issued to Holders of Trust Securities
Certificates, upon surrender of such certificates to the Administrative
Trustees or their agent for exchange, (iii) any Trust Securities Certificates
not so surrendered for exchange will be deemed to represent a Like Amount of
Junior Subordinated Notes, accruing interest at the rate provided for in the
Junior Subordinated Notes from the last Distribution Date on which a
Distribution was made on such Trust Certificates until such certificates are so
surrendered (and until such certificates are so surrendered, no payments of
interest or principal will be made to Holders of Trust Securities Certificates
with respect to such Junior Subordinated Notes) and (iv) all rights of
Securityholders holding Trust Securities will cease, except the right of such
Securityholders to receive Junior Subordinated Notes upon surrender of Trust
Securities Certificates.
(e) The Depositor will use its best efforts to have the Junior Subordinated
Notes that are distributed in exchange for the Preferred Securities to be
listed on such securities exchange as the Preferred Securities are then listed.
The Depositor may elect to have the Junior Subordinated Notes issued in book-
entry form to the Clearing Agency or its nominee pursuant to a Certificate
Depository Agreement.
Section 9.05 Bankruptcy. If an Early Termination Event specified in clause (i)
of Section 9.02 has occurred, the Trust shall be liquidated. The Property
Trustee shall distribute the Junior Subordinated Notes to the Securityholders
as provided in Section 9.04, unless such distribution is determined by the
Administrative Trustees not to be practical, in which event the Holders will be
entitled to receive out of the assets of the Trust available for distribution
to Securityholders, after satisfaction of liabilities to creditors, an amount
equal to the Liquidation Amount per Trust Security plus accrued 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 available to pay in full the
aggregate Liquidation Distribution, then, subject to the next succeeding
sentence, the amounts payable by the Trust on the Trust Securities shall be
paid on a pro rata basis (based upon Liquidation Amounts). The Holder of the
Common Securities will be entitled to receive Liquidation Distributions upon
any such dissolution, winding-up
39
<PAGE>
or termination pro rata (determined as aforesaid) with Holders of Preferred
Securities, except that, if an Indenture Event of Default has occurred and is
continuing, the Preferred Securities shall have a priority over the Common
Securities.
ARTICLE X
Miscellaneous Provisions
Section 10.01 Guarantee by the Depositor. Subject to the terms and conditions
hereof, the Depositor irrevocably and unconditionally guarantees to each person
or entity to whom the Trust is now or hereafter becomes indebted or liable (the
"Beneficiaries") the full payment, when and as due, of any and all Obligations
(as hereinafter defined) to such Beneficiaries. As used herein, "Obligations"
means any indebtedness, expenses or liabilities of the Trust, other than
obligations of the Trust to pay to Holders of any Preferred Securities or other
similar interests in the Trust the amounts due such Holders pursuant to the
terms of the Preferred Securities or such other similar interests, as the case
may be. Such guarantee is intended to be for the benefit of, and to be
enforceable by, all such Beneficiaries, whether or not such Beneficiaries have
received notice hereof.
Section 10.02 Limitation of Rights of Securityholders. The death or incapacity
of any Person having an interest, beneficial or otherwise, in a Trust Security
shall not operate to terminate this Trust Agreement, nor entitle the legal
representatives or heirs of such Person or any Securityholder for such Person,
to claim an accounting, take any action or bring any proceeding in and for a
partition or winding-up of the arrangements contemplated hereby, nor otherwise
affect the rights, obligations and liabilities of the parties hereto or any of
them.
Section 10.03 Amendment.
(a) This Trust Agreement may be amended from time to time by the Trustees and
the Depositor, without the consent of any Securityholders, (i) to cure any
ambiguity, correct or supplement any provision herein which may be inconsistent
with any other provision herein, or to make any other provisions with respect
to matters or questions arising under this Trust Agreement, which shall not be
inconsistent with the other provisions of this Trust Agreement, provided,
however, that any such amendment shall not adversely affect in any material
respect the interests of any Securityholder, (ii) to modify, eliminate or add
to any provisions of this Trust Agreement to such extent as shall be necessary
to ensure that the Trust will not be classified as other than a grantor trust
for United States federal income tax purposes at any time that any Trust
Securities are outstanding; provided, however, that, in the case of clause (i),
any amendments of this Trust Agreement shall become effective when notice
thereof is given to the Securityholders or (iii) to provide the Property
Trustee with the authority to execute on behalf of the Administrative Trustees
Definitive Preferred Securities Certificates.
(b) Except as provided in Section 10.03(c) hereof, any provision in this Trust
Agreement may be amended by the Trust or the Trustees with (i) the consent of
Securityholders representing not less than 66 2/3% (based upon Liquidation
Amounts) of the Trust Securities then Outstanding 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
40
<PAGE>
status as a grantor trust for United States federal income tax purposes or the
Trust's exemption from status of an "investment company" under the Investment
Company Act.
(c) In addition to and notwithstanding any other provision in this Trust
Agreement, without the consent of each affected Securityholder (such consent
being obtained in accordance with Section 6.03 or 6.06 hereof), this Trust
Agreement may not be amended to (i) change the amount or timing of any
Distribution (or payment upon redemption) on the Trust Securities or otherwise
adversely affect the amount of any Distribution (or payment upon redemption)
required to be made in respect of the Trust Securities as of a specified date,
(ii) restrict the right of a Securityholder to institute suit for the
enforcement of any such payment on or after such date, (iii) change the purpose
of the Trust, (iv) authorize the issuance of any additional beneficial
interests in the Trust, or (v) change the consent required pursuant to this
Section 10.03.
(d) Notwithstanding any other provisions of this Trust Agreement, the Trustees
shall not enter into or consent to any amendment to this Trust Agreement which
would cause the Trust to fail or cease to qualify for the exemption from status
of an "investment company" under the Investment Company Act of 1940, as
amended, afforded by Rule 3a-5 thereunder.
(e) Without the consent of the Depositor, this Trust Agreement may not be
amended in a manner which imposes any additional obligation on the Depositor.
In executing any amendment permitted by this Trust Agreement, the Trustees
shall be entitled to receive, and (subject to Section 8.01) shall be fully
protected in relying upon an Opinion of Counsel stating that the execution of
such amendment is authorized or permitted by this Trust Agreement. Any Trustee
may, but shall not be obligated to, enter into any such amendment which affects
such Trustee's own rights, duties, immunities or liabilities under this Trust
Agreement or otherwise.
(f) In the event that any amendment to this Trust Agreement is made, the
Administrative Trustees shall promptly provide to the Depositor a copy of such
amendment.
Section 10.04 Separability. In case any provision in this Trust Agreement or in
the Trust Securities Certificates shall be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
Section 10.05 Governing Law. THIS TRUST AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF EACH OF THE SECURITYHOLDERS, THE TRUST AND THE TRUSTEES WITH
RESPECT TO THIS TRUST AGREEMENT AND THE TRUST SECURITIES SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF DELAWARE;
PROVIDED THAT THE IMMUNITIES AND STANDARD OF CARE OF THE PROPERTY TRUSTEE SHALL
BE GOVERNED BY NEW YORK LAW.
Section 10.06 Notice of Deferral of Distribution. In the event that the
Depositor exercises its right to extend an interest payment period in respect
of the Junior Subordinated Notes pursuant to Section 104 of the Supplemental
Indenture and notice of such extension has been provided by the Depositor to
the Property Trustee, the Property Trustee shall give written notice of such
extension and of the deferral of the related Distribution on the Trust
Securities, by first-class mail, postage prepaid, mailed not later than ten
days prior to the Distribution Date upon which such Distribution
41
<PAGE>
would otherwise be payable, to each Holder of Preferred Securities at such
Holder's address appearing in the Security Register.
Section 10.07 Headings. The Article and Section headings are for convenience
only and shall not affect the construction of this Trust Agreement.
Section 10.08 Notice and Demand. Any notice, demand or other communication
which by any provision of this Trust Agreement is required or permitted to be
given or served to or upon any Securityholder or the Depositor may be given or
served in writing by deposit thereof, first class postage prepaid, in the
United States mail, hand delivery or facsimile transmission, in each case,
addressed, (i) in the case of a Preferred Securityholder, to such Preferred
Securityholder as such Securityholder's name and address appear on the Security
Register and (ii) in the case of the Common Securityholder or the Depositor, to
Duke Capital Corporation, 422 South Church Street, Charlotte, North Carolina
28202, Attention: Treasurer, Facsimile No. (704) 382-4964, with a copy to
Corporate Secretary, Facsimile No. (704) 382-8137. Such notice, demand or other
communication to or upon a Securityholder shall be deemed to have been
sufficiently given or made, for all purposes, upon hand delivery, mailing or
transmission.
Any notice, demand or other communication which by any provision of this Trust
Agreement is required or permitted to be given or served to or upon the Trust
or the Trustees shall be given in writing addressed (until another address is
published by the Trust) as follows: (i) with respect to the Property Trustee
and the Delaware Trustee, The Chase Manhattan Bank, 450 West 33rd Street, New
York, New York 10001, Attention: Corporate Trustee Administration Department;
Chase Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801,
Attention: Corporate Trust Department, as the case may be; and (ii) with
respect to the Administrative Trustees, to them at the address above for
notices to the Depositor, marked Attention: Administrative Trustees of Duke
Capital Financing Trust [ ] c/o Corporate Secretary. Such notice, demand or
other communication to or upon the Trust or the Trustees shall be deemed to
have been sufficiently given or made only upon actual receipt of the writing by
the applicable Trustee.
Section 10.09 Agreement Not to Petition. Each of the Trustees and the Depositor
agrees for the benefit of the Securityholders that, until at least one year and
one day after the Trust has been terminated in accordance with Article IX, it
shall not file, or join in the filing of, a petition against the Trust under
any bankruptcy, reorganization, arrangement, insolvency, liquidation or other
similar law (including, without limitation, the United States Bankruptcy Code)
(collectively, "Bankruptcy Laws") or otherwise join in the commencement of any
proceeding against the Trust under any Bankruptcy Law. In the event the
Depositor takes action in violation of this Section 10.09, the Property Trustee
agrees, for the benefit of Securityholders, that it shall file an answer with
the bankruptcy court or otherwise properly contest the filing of such petition
by the Depositor against the Trust or the commencement of such action and raise
the defense that the Depositor has agreed in writing not to take such action
and should be stopped and precluded therefrom and such other defenses, if any,
as counsel for the Trustees or the Trust may assert. The provisions of this
Section 10.09 shall survive the termination of this Trust Agreement.
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Section 10.10 Conflict with Trust Indenture Act.
(a) This Trust Agreement is subject to the provisions of the Trust Indenture
Act that are required to be part of this Trust Agreement and shall, to the
extent applicable, 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.
(c) If any provision hereof limits, qualifies or conflicts with another
provision hereof which is required to be included in this Trust Agreement by
any of the provisions of the Trust Indenture Act, such required provision shall
control.
(d) The application of the Trust Indenture Act to this Trust Agreement shall
not affect the nature of the Trust Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY OR ON
BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE OR
FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE
BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST
SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND AGREEMENT
TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND THE
SUBORDINATED INDENTURE AND THE AGREEMENT OF THE TRUST, SUCH SECURITYHOLDER AND
SUCH OTHERS THAT THOSE TERMS AND PROVISIONS SHALL BE BINDING, OPERATIVE AND
EFFECTIVE AS BETWEEN THE TRUST AND SUCH SECURITYHOLDER AND SUCH OTHERS.
Section 10.11 Successors. This Trust Agreement shall be binding upon and shall
inure to the benefit of any successor to both the Trust and the Trustees,
including any successor by operation of law.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Trust Agreement or
have caused this Trust Agreement to be executed on their behalf, all as of the
day and year first above written.
Duke Capital Corporation
By: _________________________________
Title: ______________________________
The Chase Manhattan Bank,
as Property Trustee
By: _________________________________
Title: ______________________________
Chase Manhattan Bank Delaware,
as Delaware Trustee
By: _________________________________
Title: ______________________________
_____________________________________
Robert T. Lucas III,
as Administrative Trustee
_____________________________________
S. L. Love,
as Administrative Trustee
44
<PAGE>
EXHIBIT A
CERTIFICATE OF TRUST
OF
DUKE CAPITAL FINANCING TRUST [ ]
THIS Certificate of Trust of Duke Capital Financing Trust [ ] (the "Trust"),
dated as of , , is being duly executed and filed by the undersigned,
as trustee, to form a business trust under the Delaware Business Trust Act (12
Del. C. (S)3801, et seq.).
1. Name. The name of the business trust formed hereby is Duke Capital Financing
Trust [ ].
2. Delaware Trustee. The name and business address of the trustee of the Trust
with a principal place of business in the State of Delaware are Chase Manhattan
Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801.
3. Effective Date. This Certificate of Trust shall be effective upon filing.
IN WITNESS WHEREOF, the undersigned, being the sole trustee of the Trust, has
executed this Certificate of Trust as of the date first-above written.
CHASE MANHATTAN BANK DELAWARE, not
in its individual capacity but
solely as trustee of the Trust
By: _________________________________
Name:
Title:
A-1
<PAGE>
EXHIBIT B
(RESERVED)
<PAGE>
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE
EXCEPT AS PROVIDED IN THE TRUST
AGREEMENT REFERRED TO HEREIN
CERTIFICATE NUMBER NUMBER OF COMMON SECURITIES
C-
CERTIFICATE EVIDENCING COMMON SECURITIES
OF
DUKE CAPITAL FINANCING TRUST [ ]
COMMON SECURITIES
(LIQUIDATION AMOUNT $ PER COMMON SECURITY)
Duke Capital Financing Trust [ ], a statutory business trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that
(the "Holder") is the registered owner of
( ) common securities of the Trust representing undivided beneficial interests
in the assets of the Trust and designated the Common Securities (Liquidation
Amount $ per Common Security) (the "Common Securities"). In accordance with
Section 5.10 of the Trust Agreement (as defined below) the Common Securities are
not transferable, except by operation of law or to an Affiliate of the Holder or
a permitted successor under Section 801 of the Subordinated Indenture, dated as
of April 1, 1998, between the Holder and The Chase Manhattan Bank, as trustee,
and any attempted transfer hereof shall be void. The designation, rights,
privileges, restrictions, preferences and other terms and provisions of the
Common Securities are set forth in, and this certificate and the Common
Securities represented hereby are issued and shall in all respects be subject to
the terms and provisions of, the Amended and Restated Trust Agreement of the
Trust dated as of , , as the same may be amended from time to time (the "Trust
Agreement"), including the designation of the terms of the Common Securities as
set forth therein. The Trust will furnish a copy of the Trust Agreement to the
Holder without charge upon written request to the Trust at its principal place
of business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust Agreement
and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, the Administrative Trustees of the Trust have executed
this certificate this day of , .
Duke Capital Financing Trust [ ]
By: _________________________________
Robert T. Lucas III,
as Administrative Trustee
By: _________________________________
S.L. Love,
as Administrative Trustee
C-1
<PAGE>
CERTIFICATE OF AUTHENTICATION
This is one of the Common Securities referred to in the within-mentioned Trust
Agreement.
_____________________________________
as Administrative Trustee
C-2
<PAGE>
EXHIBIT D
AGREEMENT AS TO EXPENSES AND LIABILITIES
THIS AGREEMENT AS TO EXPENSES AND LIABILITIES (this "Agreement") is made as of
, between Duke Capital Corporation, a Delaware corporation (the
"Corporation"), and Duke Capital Financing Trust [ ], a Delaware business trust
(the "Trust").
WHEREAS, the Trust intends to issue its Common Securities (the "Common
Securities") to and receive Series % Junior Subordinated Notes due ,
(the "Junior Subordinated Notes") from the Corporation and to issue and
sell Duke Capital Financing Trust [ ] % Trust Preferred Securities (the
"Preferred Securities") with such powers, preferences and special rights and
restrictions as are set forth in the Amended and Restated Trust Agreement of
the Trust dated as of , as the same may be amended from time to
time (the "Trust Agreement"); and
WHEREAS, the Corporation is the issuer of the Junior Subordinated Notes.
NOW, THEREFORE, in consideration of the purchase by each holder of the
Preferred Securities, which purchase the Corporation hereby agrees shall
benefit the Corporation and which purchase the Corporation acknowledges will be
made in reliance upon the execution and delivery of this Agreement, the
Corporation and the Trust hereby agree as follows:
ARTICLE I
Section 1.01. Guarantee by the Corporation. Subject to the terms and conditions
hereof, the Corporation hereby irrevocably and unconditionally guarantees to
each person or entity to whom the Trust is now or hereafter becomes indebted or
liable (the "Beneficiaries") the full payment, when and as due, of any and all
Obligations (as hereinafter defined) to such Beneficiaries. As used herein,
"Obligations" means any indebtedness, expenses or liabilities of the Trust,
other than obligations of the Trust to pay to holders of any Preferred
Securities or other similar interests in the Trust the amounts due such holders
pursuant to the terms of the Preferred Securities or such other similar
interests, as the case may be. This Agreement is intended to be for the benefit
of, and to be enforceable by, all such Beneficiaries, whether or not such
Beneficiaries have received notice hereof.
Section 1.02. Term of Agreement. This Agreement shall terminate and be of no
further force and effect upon the date on which there are no Beneficiaries
remaining; provided, however, that this Agreement shall continue to be
effective or shall be reinstated, as the case may be, if at any time any holder
of Preferred Securities or any Beneficiary must restore payment of any sums
paid under the Preferred Securities, under any Obligation, under the Guarantee
Agreement dated the date hereof by the Corporation and The Chase Manhattan
Bank, as guarantee trustee, or under this Agreement for any reason whatsoever.
This Agreement is continuing, irrevocable, unconditional and absolute.
Section 1.03. Waiver of Notice. The Corporation hereby waives notice of
acceptance of this Agreement and of any Obligation to which it applies or may
apply, and the Corporation hereby waives presentment, demand for payment,
protest, notice of nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.
D-1
<PAGE>
Section 1.04. No Impairment. The obligations, covenants, agreements and duties
of the Corporation under this Agreement shall in no way be affected or impaired
by reason of the happening from time to time of any of the following:
(a) the extension of time for the payment by the Trust of all or any
portion of the Obligations or for the performance of any other obligation
under, arising out of, or in connection with, the Obligations;
(b) any failure, omission, delay or lack of diligence on the part of the
Beneficiaries to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Beneficiaries with respect to the Obligations or
any action on the part of the Trust granting indulgence or extension of any
kind; or
(c) 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 Trust
or any of the assets of the Trust.
There shall be no obligation of the Beneficiaries to give notice to, or obtain
the consent of, the Corporation with respect to the happening of any of the
foregoing.
Section 1.05. Enforcement. A Beneficiary may enforce this Agreement directly
against the Corporation and the Corporation waives any right or remedy to
require that any action be brought against the Trust or any other person or
entity before proceeding against the Corporation.
ARTICLE II
Section 2.01. Binding Effect. All guarantees and agreements contained in this
Agreement shall bind the successors, assigns, receivers, trustees and
representatives of the Corporation and shall inure to the benefit of the
Beneficiaries.
Section 2.02. Amendment. So long as there remains any Beneficiary or any
Preferred Securities are outstanding, this Agreement shall not be modified or
amended in any manner adverse to such Beneficiary or to the holders of the
Preferred Securities.
Section 2.03. Notices. Any notice, request or other communication required or
permitted to be given hereunder shall be given in writing by delivering the
same against receipt therefor by facsimile transmission (confirmed by mail), or
by registered or certified mail, addressed as follows (and if so given, shall
be deemed given when mailed), to wit:
Duke Capital Financing Trust [ ]
c/o The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001
Facsimile No.: (212) 946-8159
Attention: Corporate Trustee
Administration Department
D-2
<PAGE>
Duke Capital Corporation
422 South Church Street
Charlotte, North Carolina 28202
Facsimile No.: (704) 382-8137
Attention: Corporate Secretary
Section 2.04. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
THIS AGREEMENT is executed as of the date and year first above written.
Duke Capital Corporation
By: _________________________________
Name:
Title:
Duke Capital Financing Trust [ ]
By: _________________________________
Robert T. Lucas III,
as Administrative Trustee
By: _________________________________
S.L. Love,
as Administrative Trustee
D-3
<PAGE>
EXHIBIT E
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO DUKE CAPITAL
FINANCING TRUST [ ] OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT 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 INASMUCH AS THE REGISTERED
OWNER THEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
CERTIFICATE NUMBER NUMBER OF PREFERRED SECURITIES
P- CUSIP NO.
CERTIFICATE EVIDENCING PREFERRED SECURITIES
OF
DUKE CAPITAL FINANCING TRUST [ ]
% TRUST PREFERRED SECURITIES
(LIQUIDATION AMOUNT $ PER PREFERRED SECURITY)
Duke Capital Financing Trust [ ], a statutory business trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that (the
"Holder") is the registered owner of ( ) Preferred Securities
of the Trust representing undivided beneficial interests in the assets of the
Trust and designated the Duke Capital Financing Trust [ ] % Trust Preferred
Securities (Liquidation Amount $ per Preferred Security) (the "Preferred
Securities"). The Preferred 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 as
provided in Section 5.04 of the Trust Agreement (as defined below). The
designation, rights, privileges, restrictions, preferences and other terms and
provisions of the Preferred Securities are set forth in, and this certificate
and the Preferred Securities represented hereby are issued and shall in all
respects be subject to the terms and provisions of, the Amended and Restated
Trust Agreement of the Trust, dated as of , , as the same may be
amended from time to time (the "Trust Agreement"), including the designation of
the terms of Preferred Securities as set forth therein. The holder of this
certificate is entitled to the benefits of a guarantee by Duke Capital
Corporation, a Delaware corporation (the "Corporation"), pursuant to a
Guarantee Agreement between the Corporation and The Chase Manhattan Bank, as
guarantee trustee, dated as of , , as the same may be amended from
time to time (the "Guarantee"), to the extent provided therein. The Trust will
furnish a copy of the Trust Agreement and the Guarantee to the holder of this
certificate without charge upon written request to the Trust at its principal
place of business or registered office.
Upon receipt of this certificate, the holder of this certificate is bound by
the Trust Agreement and is entitled to the benefits thereunder.
E-1
<PAGE>
IN WITNESS WHEREOF, the Administrative Trustees of the Trust have executed
this certificate this day of , .
Duke Capital Financing Trust [ ]
By: _________________________________
Robert T. Lucas III, as
Administrative Trustee
By: _________________________________
S.L. Love, as Administrative
Trustee
E-2
<PAGE>
CERTIFICATE OF AUTHENTICATION
This is one of the Preferred Securities referred to in the within-mentioned
Trust Agreement.
---------------------------------
as Administrative Trustee
E-3
<PAGE>
EXHIBIT 4.11
GUARANTEE AGREEMENT
BETWEEN
DUKE CAPITAL CORPORATION
(AS GUARANTOR)
AND
THE CHASE MANHATTAN BANK
(AS TRUSTEE)
DATED AS OF ,
<PAGE>
CROSS-REFERENCE TABLE(1)
<TABLE>
<CAPTION>
SECTION OF SECTION OF
TRUST INDENTURE ACT GUARANTEE
OF 1939, AS AMENDED AGREEMENT
------------------- -----------------
<S> <C>
310(a)................................................. 4.01(a)
310(b)................................................. 4.01(c), 2.08
310(c)................................................. Inapplicable
311(a)................................................. 2.02(b)
311(b)................................................. 2.02(b)
311(c)................................................. Inapplicable
312(a)................................................. 2.02(a)
312(b)................................................. 2.02(b)
313 ................................................. 2.03
314(a)................................................. 2.04
314(b)................................................. Inapplicable
314(c)................................................. 2.05
314(d)................................................. Inapplicable
314(e)................................................. 1.01, 2.05, 3.02
314(f)................................................. 2.01, 3.02
315(a)................................................. 3.01(d)
315(b)................................................. 2.07
315(c)................................................. 3.01
315(d)................................................. 3.01(d)
315(e)................................................. Inapplicable
316(a)................................................. 5.04(i), 2.06
316(b)................................................. 5.03
316(c)................................................. 2.02
317(a)................................................. Inapplicable
317(b)................................................. Inapplicable
318(a)................................................. 2.01(b)
318(b)................................................. 2.01
318(c)................................................. 2.01(a)
</TABLE>
- --------
(1) This Cross-Reference Table does not constitute part of the Guarantee
Agreement and shall not affect the interpretation of any of its terms or
provisions.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
ARTICLE I
Definitions
PAGE
----
<C> <S> <C>
Section 1.01. Definitions................................................ 1
ARTICLE II
Trust Indenture Act
Section 2.01. Trust Indenture Act; Application........................... 3
Section 2.02. Lists of Holders of Securities............................. 3
Section 2.03. Reports by the Trustee..................................... 4
Section 2.04. Periodic Reports to Trustee................................ 4
Section 2.05. Evidence of Compliance with Conditions Precedent........... 4
Section 2.06. Events of Default; Waiver.................................. 4
Section 2.07. Event of Default; Notice................................... 4
Section 2.08. Conflicting Interests...................................... 4
ARTICLE III
Powers, Duties And Rights Of Trustee
Section 3.01. Powers and Duties of the Trustee........................... 5
Section 3.02. Certain Rights of Trustee.................................. 6
Section 3.03. Compensation; Fees; Indemnity.............................. 7
ARTICLE IV
Trustee
Section 4.01. Trustee; Eligibility....................................... 8
Section 4.02. Appointment, Removal and Resignation of Trustee............ 8
ARTICLE V
Guarantee
Section 5.01. Guarantee.................................................. 9
Section 5.02. Waiver of Notice and Demand................................ 9
Section 5.03. Obligations Not Affected................................... 9
Section 5.04. Rights of Holders.......................................... 10
Section 5.05. Guarantee of Payment....................................... 10
Section 5.06. Subrogation................................................ 10
Section 5.07. Independent Obligations.................................... 11
ARTICLE VI
Subordination
Section 6.01. Subordination.............................................. 11
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
ARTICLE VII
Termination
PAGE
----
<C> <S> <C>
Section 7.01. Termination............................................... 11
ARTICLE VIII
Miscellaneous
Section 8.01. Successors and Assigns.................................... 11
Section 8.02. Amendments................................................ 11
Section 8.03. Notices................................................... 12
Section 8.04. Benefit................................................... 12
Section 8.05. Interpretation............................................ 12
Section 8.06. Governing Law............................................. 13
</TABLE>
ii
<PAGE>
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT ("Guarantee Agreement"), dated as of , , is
executed and delivered by DUKE CAPITAL CORPORATION, a Delaware corporation (the
"Guarantor"), and THE CHASE MANHATTAN BANK, a New York banking corporation, as
trustee (the "Trustee"), for the benefit of the Holders (as defined herein)
from time to time of the Preferred Securities (as defined herein) of DUKE
CAPITAL FINANCING TRUST [ ], a Delaware statutory business trust (the "Trust").
WHEREAS, pursuant to an Amended and Restated Trust Agreement (the "Trust
Agreement"), dated as of , , among the Trustee, the other Trustees
named therein, and Duke Capital Corporation, as Depositor, and the holders of
undivided beneficial interests in the assets of the Trust, the Trust is issuing
as of the date hereof $ aggregate liquidation amount of its % Trust
Preferred Securities (the "Preferred Securities") representing preferred
undivided beneficial interests in the assets of the Trust and having the terms
set forth in the Trust Agreement;
WHEREAS, the Preferred Securities will be issued by the Trust and the proceeds
thereof will be used to purchase Junior Subordinated Notes (as defined in the
Trust Agreement) of the Guarantor, which will be held by the Trust as trust
assets; and
WHEREAS, as incentive for the Holders to purchase the Preferred Securities, the
Guarantor desires to irrevocably and unconditionally agree, to the extent set
forth herein, to pay to the Holders the Guarantee Payments (as defined herein)
and to make certain other payments on the terms and conditions set forth
herein.
NOW, THEREFORE, in consideration of the payment for Preferred Securities by
each Holder thereof, which payment the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Guarantee Agreement for
the benefit of the Holders from time to time of the Preferred Securities.
ARTICLE I
Definitions
Section 1.01. Definitions. As used in this Guarantee Agreement, the terms set
forth below shall, unless the context otherwise requires, have the following
meanings. Capitalized or otherwise defined terms used but not otherwise defined
herein shall have the meanings assigned to such terms in the Trust Agreement as
in effect on the date hereof.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Common Securities" means the securities representing common undivided
beneficial interests in the assets of the Trust.
<PAGE>
"Event of Default" means a failure by the Guarantor to perform any of its
payment obligations under this Guarantee Agreement.
"Guarantee Payments" shall mean the following payments or distributions,
without duplication, with respect to the Preferred Securities, to the extent
not paid or made by or on behalf of the Trust: (i) any accrued and unpaid
distributions that are required to be paid on such Preferred Securities but if
and only if and to the extent the Trust has funds legally and immediately
available therefor to make such payment; (ii) the redemption price, including
all accrued and unpaid distributions to the date of redemption (the "Redemption
Price"), with respect to the Preferred Securities called for redemption by the
Trust but if and only if and to the extent that the Trust has funds legally and
immediately available therefor sufficient to make such payment; and (iii) upon
a voluntary or involuntary dissolution, winding-up or termination of the Trust
(other than in connection with the distribution of Junior Subordinated Notes to
the holders of Trust Securities or the redemption of all of the Preferred
Securities), the lesser of (a) the aggregate of the liquidation amount and all
accrued and unpaid distributions on the Preferred Securities to the date of
payment, to the extent the Trust has funds legally and immediately available
therefor, and (b) the amount of assets of the Trust remaining available for
distribution to Holders in liquidation of the Trust (in either case, the
"Liquidation Distribution").
"Holder" shall mean any holder, as registered on the books and records of the
Trust, of any Preferred Securities; provided, however, that in determining
whether the holders of the requisite percentage of Preferred Securities have
given any request, notice, consent or waiver hereunder, "Holder" shall not
include the Guarantor or any Affiliate of the Guarantor.
"Indenture" means the Subordinated Indenture, dated as of April 1, 1998 among
the Guarantor, as issuer, and The Chase Manhattan Bank, as trustee, as
heretofore supplemented and amended and as supplemented by the Supplemental
Indenture dated as of , , by and between the Guarantor and The Chase
Manhattan Bank, as trustee.
"Majority in liquidation amount of Preferred Securities" means a vote by
Holder(s) of Preferred Securities, voting separately as a class, of more than
50% of the liquidation amount of all Preferred Securities outstanding at the
time of determination.
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, the President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary, of the Guarantor, and
delivered to the Trustee. Any Officers' Certificate delivered with respect to
compliance with a condition or covenant provided for in this Guarantee
Agreement shall include:
(a) a statement that each officer signing the Officers' Certificate has read
such covenant or condition and the definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in the Officers'
Certificate are based;
(c) a statement that, in the opinion of each such officer, 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
2
<PAGE>
(d) a statement as to whether, in the opinion of each such officer, such
condition or covenant has been complied with.
"Person" means any individual, corporation, partnership, limited liability
company, joint venture, trust, unincorporated organization or government or any
agency or political subdivision thereof.
"Responsible Officer" means, with respect to the Trustee, any vice president,
any assistant vice president, the secretary, any assistant secretary, the
treasurer, any assistant treasurer, any senior trust officer, trust officer or
assistant trust officer or any other officer of the Corporate Trust Department
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 that officer's knowledge of and familiarity with the
particular subject.
"Successor Trustee" means a successor Trustee possessing the qualifications to
act as Trustee under Section 4.01.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
"Trust Securities" means the Preferred Securities and the Common Securities.
"Trustee" means The Chase Manhattan Bank until a Successor Trustee has been
appointed and has accepted such appointment pursuant to the terms of this
Guarantee Agreement and thereafter means each such Successor Trustee.
ARTICLE II
Trust Indenture Act
Section 2.01. Trust Indenture Act; Application.
(a) This Guarantee Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Guarantee Agreement and
shall, to the extent applicable, be governed by such provisions; and
(b) If and to the extent that any provision of this Guarantee Agreement limits,
qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
Section 2.02. Lists of Holders of Securities.
(a) The Guarantor shall furnish or cause to be furnished to the Trustee (i)
semiannually, not later than June 1 and December 1 in each year, a list, in
such form as the Trustee may reasonably require, of the names and addresses of
the Holders ("List of Holders") as of a date not more than 15 days prior to the
time such list is furnished, and (ii) at such other times as the Trustee may
request in writing, within 30 days after the receipt by the Guarantor of any
such request, a List of Holders as of a date not more than 15 days prior to the
time such list is furnished; 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
3
<PAGE>
the most recent List of Holders given to the Trustee by the Guarantor or at any
time the Trustee is the Securities Registrar under the Trust Agreement. The
Trustee may destroy any List of Holders previously given to it on receipt of a
new List of Holders.
(b) The Trustee shall comply with its obligations under Sections 311(a), 311(b)
and 312(b) of the Trust Indenture Act.
Section 2.03. Reports by the Trustee. Within 60 days after October 1 of each
year, the Trustee shall provide to the Holders of the Preferred Securities 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 Trustee shall also comply with the other requirements of Section 313
of the Trust Indenture Act.
Section 2.04. Periodic Reports to Trustee. The Guarantor shall provide to the
Trustee such documents, reports and information as required by Section 314 of
the Trust Indenture Act (if any) in the form, in the manner and at the times
required by Section 314 of the Trust Indenture Act, and shall provide, within
120 days after the end of each fiscal year of the Guarantor, the compliance
certificate required by Section 314(a)(4) of the Trust Indenture Act in the
form and in the manner required by such Section.
Section 2.05. Evidence of Compliance with Conditions Precedent. The Guarantor
shall provide to the Trustee such evidence of compliance with any conditions
precedent, if any, provided for in this Guarantee Agreement 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 2.06. Events of Default; Waiver. The Holders of a Majority in
liquidation amount of Preferred Securities may, by vote, on behalf of all of
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 and not to have
existed, for every purpose of this Guarantee Agreement, but no such waiver
shall extend to any subsequent or other default or Event of Default or impair
any right consequent thereon.
Section 2.07. Event of Default; Notice.
(a) The Trustee shall, within 90 days after the occurrence of an Event of
Default, transmit by mail, first-class postage prepaid, to the Holders, notices
of all Events of Default known to the Trustee, unless such defaults have been
cured before the giving of such notice, provided that 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 determines that the withholding of such
notice is in the interests of the Holders.
(b) The Trustee shall not be deemed to have knowledge of any Event of Default
unless the Trustee shall have received written notice, or a Responsible Officer
charged with the administration of the Trust Agreement shall have obtained
written notice, of such Event of Default.
Section 2.08. Conflicting Interests. The Trust Agreement, the Guarantee
Agreements dated as of June 1, 1998 and September 15, 1998, between the
Guarantor, as guarantor, and The Chase
4
<PAGE>
Manhattan Bank, as trustee, and the Amended and Restated Trust Agreements dated
as of June 1, 1998 and September 15, 1998, among the Guarantor, as depositor,
Chase Manhattan Bank Delaware, as Delaware trustee, Robert T. Lucas III and
S.L. Love, as administrative trustees, and The Chase Manhattan Bank, as
property trustee, shall be deemed to be specifically described in this
Guarantee Agreement 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 Trustee
Section 3.01. Powers and Duties of the Trustee.
(a) This Guarantee Agreement shall be held by the Trustee for the benefit of
the Holders, and the Trustee shall not transfer this Guarantee Agreement to any
Person except the Trustee shall assign rights hereunder to a Holder to the
extent such assignment is necessary to exercise such Holder's rights pursuant
to Section 5.04 or to a Successor Trustee upon acceptance by such Successor
Trustee of its appointment to act as Successor Trustee. The right, title and
interest of the Trustee shall automatically vest in any Successor Trustee, and
such vesting and cessation of title shall be effective whether or not
conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor Trustee.
(b) If an Event of Default has occurred and is continuing, the Trustee shall
enforce this Guarantee Agreement for the benefit of the Holders.
(c) The Trustee, before the occurrence of any Event of Default and after the
curing or waiving of all Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set forth in this
Guarantee Agreement, and no implied covenants shall be read into this Guarantee
Agreement against the Trustee. In case an Event of Default has occurred (that
has not been cured or waived pursuant to Section 2.06), the Trustee shall
exercise such of the rights and powers vested in it by this Guarantee
Agreement, 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.
(d) No provision of this Guarantee Agreement 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:
(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 Trustee shall be determined solely by the
express provisions of this Guarantee Agreement, and the Trustee shall not be
liable except for the performance of such duties and obligations as are
specifically set forth in this Guarantee Agreement; and
(B) 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 therein, upon any certificates
5
<PAGE>
or opinions furnished to the Trustee and conforming to the requirements of this
Guarantee Agreement; but in the case of any such certificates or opinions that
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 Guarantee Agreement;
(ii) the Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer of the Trustee, unless it shall be proved that
the Trustee was negligent in ascertaining the pertinent facts upon which such
judgment was made;
(iii) 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
Holders of a Majority in liquidation amount of the Preferred Securities
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 Guarantee Agreement; and
(iv) no provision of this Guarantee Agreement 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 the Trustee 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 Guarantee Agreement or adequate indemnity against such risk or
liability is not reasonably assured to it.
Section 3.02. Certain Rights of Trustee.
(a) Subject to the provisions of Section 3.01:
(i) the Trustee may 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 Guarantee
Agreement shall be sufficiently evidenced by an Officers' Certificate;
(iii) whenever, in the administration of this Guarantee Agreement, the Trustee
shall deem it desirable that a matter be proved or established before taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
is herein specifically prescribed) may, in the absence of bad faith on its
part, request and rely upon an Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by the Guarantor;
(iv) the Trustee may consult with counsel of its choice, and the written 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 Trustee shall have the right at any
time to seek instructions concerning the administration of this Guarantee
Agreement from any court of competent jurisdiction;
6
<PAGE>
(v) the Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Guarantee Agreement at the request or direction of
any Holder, unless such Holder shall have provided to the Trustee such adequate
security and indemnity as would satisfy a reasonable person in the position of
the Trustee, against the costs, expenses (including attorneys' fees and
expenses) 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 Trustee; provided that nothing contained in this Section 3.02(a)(v) shall
be taken to relieve the Trustee, upon the occurrence of an Event of Default, of
its obligation to exercise the rights and powers vested in it by this Guarantee
Agreement;
(vi) the Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document, but the Trustee, in
its discretion, may make such further inquiry or investigation into such facts
or matters as it may see fit;
(vii) the Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents or attorneys, and
the Trustee shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it hereunder; and
(viii) whenever in the administration of this Guarantee Agreement the Trustee
shall deem it desirable to receive instructions with respect to enforcing any
remedy or right or taking any other action hereunder, the Trustee (i) may
request instructions from the Holders, (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 acting in accordance with such
instructions.
(b) No provision of this Guarantee Agreement shall be deemed to impose any duty
or obligation on the 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 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 Trustee shall be construed to be a duty.
Section 3.03. Compensation; Fees; Indemnity.
The Guarantor agrees:
(a) to pay to the Trustee from time to time reasonable compensation for all
services rendered by the Trustee hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee of
an express trust);
(b) except as otherwise expressly provided herein, to reimburse the Trustee
upon request for all reasonable expenses, disbursements and advances incurred
or made by the Trustee in accordance with any provision of this Guarantee
Agreement (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to its negligence or bad faith; and
7
<PAGE>
(c) to indemnify the Trustee for, and to hold the Trustee harmless against, any
and all loss, damage, claims, liability or expense incurred without negligence
or bad faith on its part, arising out of or in connection with the acceptance
or administration of this Guarantee Agreement, including the costs and expenses
of defending itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder.
The provisions of this Section 3.03 shall survive the termination of this
Guarantee Agreement.
ARTICLE IV
Trustee
Section 4.01. Trustee; Eligibility.
(a) There shall at all times be a 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 4.01(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 Trustee shall cease to be eligible to so act under
Section 4.01(a), the Trustee shall immediately resign in the manner and with
the effect set out in Section 4.02(c).
(c) 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 Guarantor
shall in all respects comply with the provisions of Section 310(b) of the Trust
Indenture Act, subject to the rights of the Trustee under the penultimate
paragraph thereof.
Section 4.02. Appointment, Removal and Resignation of Trustee.
(a) Subject to Section 4.02(b), the Trustee may be appointed or removed without
cause at any time by the Guarantor.
(b) The Trustee shall not be removed until a Successor Trustee has been
appointed and has accepted such appointment by written instrument executed by
such Successor Trustee and delivered to the Guarantor.
(c) The Trustee appointed to office shall hold office until a Successor Trustee
shall have been appointed or until its removal or resignation. The Trustee may
resign from office (without need for
8
<PAGE>
prior or subsequent accounting) by an instrument in writing executed by the
Trustee and delivered to the Guarantor, which resignation shall not take effect
until a Successor Trustee has been appointed and has accepted such appointment
by instrument in writing executed by such Successor Trustee and delivered to
the Guarantor and the resigning Trustee.
(d) If no Successor Trustee shall have been appointed and accepted appointment
as provided in this Section 4.02 within 60 days after delivery to the Guarantor
of an instrument of resignation, the resigning Trustee may petition any court
of competent jurisdiction for appointment of a Successor Trustee. Such court
may thereupon, after prescribing such notice, if any, as it may deem proper,
appoint a Successor Trustee.
ARTICLE V
Guarantee
Section 5.01. Guarantee. The Guarantor irrevocably and unconditionally agrees
to pay in full to the Holders the Guarantee Payments (without duplication of
amounts theretofore paid by or on behalf of the Trust), as and when due,
regardless of any defense, right of set-off or counterclaim which the Guarantor
may have or assert against any person. 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 Trust to pay such amounts to the
Holders.
Section 5.02. Waiver of Notice and Demand. The Guarantor hereby waives notice
of acceptance of this Guarantee Agreement and of any liability to which it
applies or may apply, presentment, demand for payment, any right to require a
proceeding first against the Trust 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 5.03. Obligations Not Affected. The obligation of the Guarantor to make
the Guarantee Payments under this Guarantee Agreement 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 Trust of any express or implied agreement, covenant, term
or condition relating to the Preferred Securities to be performed or observed
by the Trust;
(b) the extension of time for the payment by the Trust of all or any portion of
the Distributions, Redemption Price, Liquidation Distribution or any other sums
payable under the terms of the Preferred Securities or the extension of time
for the performance of any other obligation under, arising out of, or in
connection with, the Preferred 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 Junior Subordinated Notes 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 Preferred Securities, or
any action on the part of the Trust 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 Trust or any of the assets of the
Trust;
(e) any invalidity of, or defect or deficiency in, the Preferred Securities;
(f) the settlement or compromise of any obligation guaranteed hereby or hereby
incurred; or
(g) 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 5.03 that the obligations of the Guarantor hereunder 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 5.04. Rights of Holders. The Guarantor expressly acknowledges that: (i)
this Guarantee Agreement will be deposited with the Trustee to be held for the
benefit of the Holders; (ii) the Trustee has the right to enforce this
Guarantee Agreement on behalf of the Holders; (iii) the Holders of a Majority
in liquidation amount of the Preferred Securities have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee in respect of this Guarantee Agreement or to direct the exercise of
any trust or power conferred upon the Trustee under this Guarantee Agreement,
provided that such direction shall not be in conflict with any rule of law or
with this Guarantee Agreement, and could not involve the Trustee in personal
liability in circumstances where reasonable indemnity would not be adequate;
and (iv) any Holder may institute a legal proceeding directly against the
Guarantor to enforce its rights under this Guarantee Agreement, without first
instituting a legal proceeding against or requesting or directing that action
be taken by the Trustee or any other person; it being understood and intended
that no one or more of such Holders shall have any right in any manner
whatsoever by virtue of, or by availing of, any provision of this Guarantee
Agreement to affect, disturb or prejudice the rights of any other of such
Holders or to obtain or to seek to obtain priority or preference over any other
of such Holders or to enforce any right under this Guarantee Agreement, except
in the manner herein provided and for the equal and ratable benefit of all of
such Holders.
Section 5.05. Guarantee of Payment. This Guarantee Agreement creates a
guarantee of payment and not of collection. This Guarantee Agreement will not
be discharged except by payment of the Guarantee Payments in full (without
duplication) or upon the distribution of Junior Subordinated Notes to the
Holders in exchange for all of the Preferred Securities.
Section 5.06. Subrogation. The Guarantor shall be subrogated to all (if any)
rights of the Holders against the Trust in respect of any amounts paid to the
Holders by the Guarantor under this Guarantee Agreement; provided, however,
that the Guarantor shall not (except to the extent required by mandatory
provisions of law) be entitled to enforce or exercise any rights which it may
acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Guarantee Agreement,
if, at the time of any such payment, any amounts of Guarantee Payments are due
and unpaid under this Guarantee Agreement. If any amount shall be
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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 5.07. Independent Obligations. The Guarantor acknowledges that its
obligations hereunder are independent of the obligations of the Trust with
respect to the Preferred Securities and that the Guarantor shall be liable as
principal and as debtor hereunder to make Guarantee Payments pursuant to the
terms of this Guarantee Agreement notwithstanding the occurrence of any event
referred to in subsections (a) through (g), inclusive, of Section 5.03 hereof.
ARTICLE VI
Subordination
Section 6.01. Subordination. This Guarantee Agreement will constitute an
unsecured obligation of the Guarantor and will rank (i) subordinate and junior
in right of payment to all other liabilities of the Guarantor, including the
Junior Subordinated Notes, except those obligations or liabilities made pari
passu or subordinate by their terms, (ii) pari passu with the most senior
preferred stock now or hereafter issued by the Guarantor, and (iii) senior to
all common stock of the Guarantor. This Guarantee Agreement ranks pari passu
with each other substantially similar guarantee agreement entered into by the
Guarantor in respect of trust or other preferred securities issued by an
Affiliate of the Guarantor.
ARTICLE VII
Termination
Section 7.01. Termination. This Guarantee Agreement shall terminate and be of
no further force and effect upon: (i) full payment of the Redemption Price of
all Preferred Securities, (ii) the distribution of Junior Subordinated Notes to
the Holders in exchange for all of the Preferred Securities, or (iii) full
payment of the amounts payable in accordance with the Trust Agreement upon
liquidation of the Trust. Notwithstanding the foregoing, this Guarantee
Agreement 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 with
respect to Preferred Securities or under this Guarantee Agreement.
ARTICLE VIII
Miscellaneous
Section 8.01. Successors and Assigns. All guarantees and agreements contained
in this Guarantee Agreement shall bind the successors, assigns, receivers,
trustees and representatives of the Guarantor and shall inure to the benefit of
the Holders then outstanding. Except in connection with a consolidation,
merger, conveyance, transfer, or lease involving the Guarantor that is
permitted under Article Eight of the Indenture, the Guarantor shall not assign
its obligations hereunder.
Section 8.02. Amendments. Except with respect to any changes which do not
materially and adversely affect the rights of Holders (in which case no consent
of Holders will be required), this Guarantee Agreement may only be amended with
the prior approval of the Holders of not less than
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66 2/3% in liquidation amount of all the outstanding Preferred Securities. The
provisions of Article Six of the Trust Agreement concerning meetings of Holders
shall apply to the giving of such approval.
Section 8.03. Notices. Any notice, request or other communication required or
permitted to be given hereunder shall be in writing, duly signed by the party
giving such notice, and delivered, telecopied or mailed by first-class mail as
follows:
(a) if given to the Guarantor, to the address set forth below or such other
address as the Guarantor may give notice of to the Trustee and the Holders:
Duke Capital Corporation
422 South Church Street
Charlotte, North Carolina 28202
Attn: Corporate Secretary
(b) if given to the Trust, in care of the Trustee, or to the Trustee at the
Trust's (and the Trustee's) address set forth below or such other address as
the Trustee on behalf of the Trust may give notice to the Holders:
Duke Capital Financing Trust [ ]
c/o The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001
Attn: Corporate Trustee Administration Department
with a copy, in the case of a notice to the Trust (other than a notice from the
Guarantor), to the Guarantor.
(c) if given to any Holder, at the address set forth on the books and records
of the Trust.
All notices hereunder 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 8.04. Benefit. This Guarantee Agreement is solely for the benefit of
the Holders and, subject to Section 3.01(a), is not separately transferable
from the Preferred Securities.
Section 8.05. Interpretation. In this Guarantee Agreement, unless the context
otherwise requires:
(a) capitalized terms used in this Guarantee Agreement but not defined in the
preamble hereto have the respective meanings assigned to them in Section 1.01;
(b) a term defined anywhere in this Guarantee Agreement has the same meaning
throughout;
(c) all references to "the Guarantee Agreement" or "this Guarantee Agreement"
are to this Guarantee Agreement as modified, supplemented or amended from time
to time;
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(d) all references in this Guarantee Agreement to Articles and Sections are to
Articles and Sections of this Guarantee Agreement unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning when used in
this Guarantee Agreement unless otherwise defined in this Guarantee Agreement
or unless the context otherwise requires;
(f) a reference to the singular includes the plural and vice versa; and
(g) the masculine, feminine or neuter genders used herein shall include the
masculine, feminine and neuter genders.
Section 8.06. Governing Law. THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF
NEW YORK. THE GUARANTOR HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND ANY
COURT IN THE STATE OF NEW YORK LOCATED IN THE CITY AND COUNTY OF NEW YORK IN
ANY ACTION, SUIT OR PROCEEDING BROUGHT AGAINST IT AND RELATED TO OR IN
CONNECTION WITH THIS GUARANTEE AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
THEREBY, AND TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE GUARANTOR HEREBY
WAIVES AND AGREES NOT TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE IN
ANY SUCH SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY
SUBJECT TO THE JURISDICTION OF SUCH COURTS, THAT THE SUIT, ACTION OR PROCEEDING
IS BROUGHT IN AN INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR
PROCEEDING IS IMPROPER, OR THAT THIS GUARANTEE AGREEMENT OR ANY DOCUMENT OR ANY
INSTRUMENT REFERRED TO HEREIN OR THE SUBJECT MATTER HEREOF MAY NOT BE LITIGATED
IN OR BY SUCH COURTS. THE GUARANTOR AGREES THAT SERVICE OF PROCESS MAY BE MADE
UPON IT BY CERTIFIED OR REGISTERED MAIL TO THE ADDRESS FOR NOTICES SET FORTH IN
THIS GUARANTEE AGREEMENT OR ANY METHOD AUTHORIZED BY THE LAWS OF NEW YORK.
This instrument may be executed in any number of counterparts, each of which so
executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
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THIS GUARANTEE AGREEMENT is executed as of the day and year first above
written.
Duke Capital Corporation
By: _________________________________
Name: _______________________________
Title: ______________________________
The Chase Manhattan Bank,
as Trustee
By: _________________________________
Name: _______________________________
Title: ______________________________
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EXHIBIT 5.1
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10019
January 27, 1999
Duke Capital Corporation
422 South Church Street
Charlotte, North Carolina 28202
Re: Registration Statement on Form S-3
----------------------------------
Dear Sirs:
We are acting as counsel to Duke Capital Corporation (the "Corporation") in
connection with the preparation of a Registration Statement on Form S-3 (the
"Registration Statement"), including a preliminary prospectus and preliminary
prospectus supplements, which is to be filed with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended (the
"Act"), for the registration under the Act of (1) Junior Subordinated Notes (the
"Junior Subordinated Notes") to be issued by the Corporation, (2) Trust
Preferred Securities (liquidation amount $ per Trust Preferred Security) to be
issued by Duke Capital Financing Trust III, Duke Capital Financing Trust IV and
Duke Capital Financing Trust V, (3) the Corporation's Guarantees (as defined
in the Registration Statement) with respect to such Trust Preferred Securities
and (4) Senior Notes (the "Senior Notes") to be issued by the Corporation. The
Junior Subordinated Notes will be issued pursuant to a subordinated indenture,
as supplemented, between the Corporation and the trustee named therein (the
"Subordinated Indenture"), the Guarantees will be issued pursuant to separate
guarantee agreements between the Corporation and the trustee named therein (the
"Guarantee Agreements") and the Senior Notes will be issued pursuant to a senior
indenture, as supplemented, between the Corporation and the trustee named
therein (the "Senior Indenture"), in each case substantially in the respective
forms filed as exhibits to the Registration Statement.
We are of the opinion that, upon compliance with the pertinent provisions of
the Act and the Trust Indenture Act of 1939, as amended, upon compliance with
applicable securities or blue sky laws of various jurisdictions and upon the
adoption of appropriate resolutions by the Board of Directors of the Corporation
or a duly authorized committee thereof, when the Subordinated Indenture, the
Guarantee Agreements and the Senior Indenture have been
<PAGE>
duly executed and delivered by the proper officers of the Corporation and the
trustees named therein, and when the Junior Subordinated Notes, the Guarantees
and the Senior Notes have been executed, authenticated and delivered in
accordance with the terms of the Subordinated Indenture, the Guarantee
Agreements and the Senior Indenture, as the case may be, the Junior Subordinated
Notes, the Guarantees and the Senior Notes will be valid, binding and legal
obligations of the Corporation (subject to applicable bankruptcy, moratorium and
similar laws from time to time in force and to general principles of equity,
whether considered in a proceeding at law or in equity).
The foregoing opinion is limited solely to the Federal laws of the United
States, the laws of the State of New York and the General Corporation Law of the
State of Delaware, and we are expressing no opinion as to the effect of the laws
of any other jurisdiction.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the statements with respect to our firm under the
caption "Validity of the Securities" in the Registration Statement. In giving
the foregoing consent, we do not hereby admit that we come within the category
of persons whose consent is required under Section 7 of the Act or the rules and
regulations of the Commission thereunder.
Very truly yours,
/s/ Dewey Ballantine LLP
<PAGE>
Exhibit 5.2-A
RICHARDS, LAYTON & FINGER, P.A.
One Rodney Square
Wilmington, Delaware 19899
January 27, 1999
Duke Capital Financing Trust III
c/o Duke Capital Corporation
422 South Church Street
Charlotte, North Carolina 28202
Re: Duke Capital Financing Trust III
--------------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for Duke Capital Corporation, a
Delaware corporation (the "Corporation"), and Duke Capital Financing Trust III,
a Delaware 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 January 29, 1998 as
filed with the office of the Secretary of State of the State of Delaware (the
"Secretary of State") on January 29, 1998;
(b) The Trust Agreement of the Trust, dated as of January 29, 1998
between the Corporation, as Depositor, and the trustee of the Trust named
therein;
(c) The Registration Statement (the "Registration Statement") on Form S-3,
including a preliminary prospectus
<PAGE>
(the "Prospectus") and form of prospectus supplement (the "Prospectus
Supplement"), relating to the % Cumulative Trust Preferred Securities of the
Trust representing preferred undivided beneficial interests in the assets of the
Trust (each, a "Preferred Security" and collectively, the "Preferred
Securities"), filed by the Corporation, the Trust and others as set forth
therein with the Securities and Exchange Commission on January 27, 1999;
(d) A form of Amended and Restated Trust Agreement for the Trust, to be
entered into between the Corporation, the trustees of the Trust named therein,
and the holders, from time to time, of undivided beneficial interests in the
assets of the Trust (including Exhibits C and E thereto) (the "Trust
Agreement"), attached as an exhibit to the Registration Statement; and
(e) A Certificate of Good Standing for the Trust, dated January 27, 1999,
obtained from the Secretary of State.
Initially 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 (e) above. In particular, we have
not reviewed any document (other than the documents listed in paragraphs (a)
through (e) 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
and the Certificate of Trust are in full force and effect and have not been
amended, (ii) except to the extent provided in paragraph 1 below, the due
creation or due organization or due formation, 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, organization or formation,
(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) the due authorization, execution and
delivery
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<PAGE>
by all parties thereto of all documents examined by us, (vi) the receipt by each
Person to whom a Preferred Security is to be issued by the Trust (collectively,
the "Preferred Security Holders") of a Preferred Security Certificate for such
Preferred Security and the payment for such Preferred Security, in accordance
with the Trust Agreement and the Registration Statement, and (vii) that the
Preferred Securities are issued and sold to the Preferred Security Holders in
accordance with the Trust Agreement and 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 which 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.
2. The Preferred Securities will represent valid 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 Preferred 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 Preferred 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. In addition, we hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus and the Prospectus Supplement. 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 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, P.A.
<PAGE>
Exhibit 5.2-B
RICHARDS, LAYTON & FINGER, P.A.
One Rodney Square
Wilmington, Delaware 19899
January 27, 1999
Duke Capital Financing Trust IV
c/o Duke Capital Corporation
422 South Church Street
Charlotte, North Carolina 28202
Re: Duke Capital Financing Trust IV
-------------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for Duke Capital Corporation, a
Delaware corporation (the "Corporation"), and Duke Capital Financing Trust IV, a
Delaware 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 September 25, 1998 as
filed with the office of the Secretary of State of the State of Delaware (the
"Secretary of State") on September 25, 1998;
(b) The Trust Agreement of the Trust, dated as of September 25, 1998
between the Corporation, as Depositor, and the trustee of the Trust named
therein;
(c) The Registration Statement (the "Registration Statement") on Form S-3,
including a preliminary prospectus
<PAGE>
(the "Prospectus") and form of prospectus supplement (the "Prospectus
Supplement"), relating to the % Cumulative Trust Preferred Securities of the
Trust representing preferred undivided beneficial interests in the assets of the
Trust (each, a "Preferred Security" and collectively, the "Preferred
Securities"), filed by the Corporation, the Trust and others as set forth
therein with the Securities and Exchange Commission on January 27, 1999;
(d) A form of Amended and Restated Trust Agreement for the Trust, to be
entered into between the Corporation, the trustees of the Trust named therein,
and the holders, from time to time, of undivided beneficial interests in the
assets of the Trust (including Exhibits C and E thereto) (the "Trust
Agreement"), attached as an exhibit to the Registration Statement; and
(e) A Certificate of Good Standing for the Trust, dated January 27, 1999,
obtained from the Secretary of State.
Initially 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 (e) above. In particular, we have
not reviewed any document (other than the documents listed in paragraphs (a)
through (e) 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
and the Certificate of Trust are in full force and effect and have not been
amended, (ii) except to the extent provided in paragraph 1 below, the due
creation or due organization or due formation, 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, organization or formation,
(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) the due authorization, execution and
delivery
2
<PAGE>
by all parties thereto of all documents examined by us, (vi) the receipt by each
Person to whom a Preferred Security is to be issued by the Trust (collectively,
the "Preferred Security Holders") of a Preferred Security Certificate for such
Preferred Security and the payment for such Preferred Security, in accordance
with the Trust Agreement and the Registration Statement, and (vii) that the
Preferred Securities are issued and sold to the Preferred Security Holders in
accordance with the Trust Agreement and 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 which 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.
2. The Preferred Securities will represent valid 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 Preferred 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 Preferred 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. In addition, we hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus and the Prospectus Supplement. 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 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, P.A.
<PAGE>
Exhibit 5.2-C
RICHARDS, LAYTON & FINGER, P.A.
One Rodney Square
Wilmington, Delaware 19899
January 27, 1999
Duke Capital Financing Trust V
c/o Duke Capital Corporation
422 South Church Street
Charlotte, North Carolina 28202
Re: Duke Capital Financing Trust V
------------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for Duke Capital Corporation, a
Delaware corporation (the "Corporation"), and Duke Capital Financing Trust V,
a Delaware 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 September 25, 1998 as
filed with the office of the Secretary of State of the State of Delaware (the
"Secretary of State") on September 25, 1998;
(b) The Trust Agreement of the Trust, dated as of September 25, 1998
between the Corporation, as Depositor, and the trustee of the Trust named
therein;
(c) The Registration Statement (the "Registration Statement") on Form S-3,
including a preliminary prospectus
<PAGE>
(the "Prospectus") and form of prospectus supplement (the "Prospectus
Supplement"), relating to the % Cumulative Trust Preferred Securities of the
Trust representing preferred undivided beneficial interests in the assets of the
Trust (each, a "Preferred Security" and collectively, the "Preferred
Securities"), filed by the Corporation, the Trust and others as set forth
therein with the Securities and Exchange Commission on January 27, 1999;
(d) A form of Amended and Restated Trust Agreement for the Trust, to be
entered into between the Corporation, the trustees of the Trust named therein,
and the holders, from time to time, of undivided beneficial interests in the
assets of the Trust (including Exhibits C and E thereto) (the "Trust
Agreement"), attached as an exhibit to the Registration Statement; and
(e) A Certificate of Good Standing for the Trust, dated January 27, 1999,
obtained from the Secretary of State.
Initially 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 (e) above. In particular, we have
not reviewed any document (other than the documents listed in paragraphs (a)
through (e) 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
and the Certificate of Trust are in full force and effect and have not been
amended, (ii) except to the extent provided in paragraph 1 below, the due
creation or due organization or due formation, 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, organization or formation,
(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) the due authorization, execution and
delivery
2
<PAGE>
by all parties thereto of all documents examined by us, (vi) the receipt by each
Person to whom a Preferred Security is to be issued by the Trust (collectively,
the "Preferred Security Holders") of a Preferred Security Certificate for such
Preferred Security and the payment for such Preferred Security, in accordance
with the Trust Agreement and the Registration Statement, and (vii) that the
Preferred Securities are issued and sold to the Preferred Security Holders in
accordance with the Trust Agreement and 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 which 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.
2. The Preferred Securities will represent valid 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 Preferred 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 Preferred 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. In addition, we hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus and the Prospectus Supplement. 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 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, P.A.
<PAGE>
EXHIBIT 8
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10019
January 27, 1999
Duke Capital Corporation
422 South Church Street
Charlotte, North Carolina 28202
Re: Registration Statement on Form S-3
Dear Sirs:
We have acted as counsel to Duke Capital Corporation (the "Corporation") in
connection with the preparation of a Registration Statement on Form S-3 (the
"Registration Statement"), including a preliminary prospectus and preliminary
prospectus supplements, which is to be filed with the Securities and Exchange
Commission (the "Commission") for the registration under the Securities Act of
1933 (the "Securities Act"), of (1) Junior Subordinated Notes (the "Junior
Subordinated Notes") to be issued by the Corporation to Duke Capital Financing
Trust III, Duke Capital Financing Trust IV and Duke Capital Financing Trust V
(the "Trusts"), (2) Trust Preferred Securities (liquidation amount $ per
Preferred Security) to be issued by the Trusts and (3) the Corporation's
Guarantees (as defined in the Registration Statement) with respect to such Trust
Preferred Securities. The Trusts will be organized pursuant to amended and
restated trust agreements between the Corporation and the trustees named
therein. The Junior Subordinated Notes will be issued pursuant to a subordinated
indenture, as supplemented, between the Corporation and the trustee named
therein and the Guarantees will be issued pursuant to guarantee agreements
between the Corporation and the trustee named therein, in each case in the
respective forms filed as exhibits to the Registration Statement.
On the basis and subject to the accuracy of the statements contained in the
materials referred to above, and our consideration of such other matters as we
have deemed necessary, it is our opinion that under current law the material
federal income tax consequences to holders of Trust Preferred Securities issued
by the Trusts will be as described under the heading "Material Federal Income
Tax Considerations" in the preliminary prospectus supplement relating thereto
constituting part of the Registration Statement. You have not requested, and we
do not express, an opinion concerning any other tax consequences of the issuance
by the Trusts of the Trust Preferred Securities. This opinion is not to be used,
circulated, quoted or otherwise referred to for any purpose without our express
written permission.
1
<PAGE>
We hereby consent to the filing of this opinion with the Commission as an
exhibit to the Registration Statement and to the statements with respect to our
firm in the section captioned "Material Federal Income Tax Considerations" in
the preliminary prospectus supplement relating to the Trust Preferred Securities
constituting part of the Registration Statement. In giving the foregoing
consent, we do not thereby admit that we come within the category of persons
whose consent is required under Section 7 of the Securities Act or the rules and
regulations of the Commission thereunder.
Very truly yours,
/s/ Dewey Ballantine LLP
2
<PAGE>
EXHIBIT 12
DUKE CAPITAL CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(DOLLARS IN MILLIONS)
<TABLE>
<CAPTION>
Nine Months Ended Twelve Months Ended
--------------------- --------------------------------------------
Sept 30, Sept 30, Dec 31, Dec 31, Dec 31, Dec 31, Dec 31,
1998 1997a 1997a 1996a 1995a 1994a 1993a
------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings Before Income
Taxes.................. $ 577.9 $ 487.0 $ 636.9 $ 651.1 $ 572.3 $ 448.5 $ 321.6
Fixed Charges........... 195.4 170.9 234.7 253.6 264.2 263.2 298.5
------- -------- ------- ------- ------- ------- -------
Total............... $ 773.3 $ 657.9 $ 871.6 $ 904.7 $ 836.5 $ 711.7 $ 620.1
------- -------- ======= ======= ======= ======= =======
Fixed Charges
Interest on debt....... $ 189.6 $ 163.6 $ 224.3 $ 237.5 $ 252.9 $ 253.2 $ 289.2
Interest component of
rentals............... 5.8 7.6 10.4 16.1 11.3 10.0 9.3
------- -------- ------- ------- ------- ------- -------
Fixed Charges....... $ 195.4 $ 170.9 $ 234.7 $ 253.6 $ 264.2 $ 263.2 $ 298.5
------- -------- ======= ======= ======= ======= =======
Ratio of Earnings to
Fixed Charges.......... 4.0 3.8 3.7 3.6 3.2 2.7 2.1
</TABLE>
- ----------------------
a Financial information reflects accounting for the combination with PanEnergy
on June 30, 1997 similar to a pooling of interests. As a result, the financial
information gives effect to the combination as if it had occurred as of January
1, 1993.
<PAGE>
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement
on Form S-3 of Duke Capital Corporation of our report dated February 13, 1998
appearing in the Form 10 of Duke Capital Corporation, and to the reference to us
under the heading "Experts" in the Prospectus which is a part of this
Registration Statement.
/s/ DELOITTE & TOUCHE LLP
- -------------------------------
DELOITTE & TOUCHE LLP
Charlotte, North Carolina
January 27, 1999
<PAGE>
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement on
Form S-3 of Duke Capital Corporation of our report dated January 16, 1997 on the
consolidated balance sheet of PanEnergy Corp as of December 31, 1996 and the
related consolidated statements of income, common stockholders' equity and cash
flows for the years ended December 31, 1996 and 1995 appearing in the annual
report on Form 10-K of PanEnergy Corp for the year ended December 31, 1996 and
to the reference to our firm under the heading "Experts" in the Prospectus.
/s/ KPMG LLP
- ---------------------------
KPMG LLP
Houston, Texas
January 27, 1999
<PAGE>
EXHIBIT 24.1
DUKE CAPITAL CORPORATION
POWER OF ATTORNEY
-----------------
$1,000,000,000
Senior Notes
Junior Subordinated Notes
(Securities)
The undersigned DUKE CAPITAL CORPORATION, a Delaware corporation, and
certain of its officers and/or directors, do each hereby constitute and appoint
Richard J. Osborne, Robert S. Lilien and Robert T. Lucas III, and each of them,
to act as attorneys-in-fact for and in the respective names, places and stead of
the undersigned, to execute, seal, sign, and file with the Securities and
Exchange Commission a Registration Statement of said Duke Capital Corporation on
Form S-3 and any and all amendments thereto for the purpose of registering under
the Securities Act of 1933 the Securities, hereby granting to said attorneys-in-
fact, and each of them, full power and authority to do and perform all and every
act and thing whatsoever requisite, necessary, or proper to be done in and about
the premises, as fully to all intents and purposes as the undersigned, or any of
them, might or could do if personally present, hereby ratifying and approving
the acts of said attorneys-in-fact.
Executed the 27th day of January, 1999.
DUKE CAPITAL CORPORATION
By /s/ R. B. Priory
-----------------------
President and
Chief Executive Officer
(Corporate Seal)
ATTEST:
/s/ Robert T. Lucas III
- -----------------------
Assistant Secretary
<PAGE>
/s/ R. B. Priory President and Chief Executive Officer
------------------ (Principal Executive Officer and Director)
R. B. Priory
/s/ R. J. Osborne Vice President and Chief Financial
------------------ Officer (Principal Financial Officer)
R. J. Osborne
/s/ J. L. Boyer Controller
------------------ (Principal Accounting Officer)
J. L. Boyer
/s/ F. J. Fowler (Director)
------------------
F. J. Fowler
/s/ R. S. Lilien (Director)
------------------
R. S. Lilien
/s/ R. J. Osborne (Director)
------------------
R. J. Osborne
<PAGE>
EXHIBIT 24.2
DUKE CAPITAL CORPORATION
CERTIFICATE
The undersigned officer of DUKE CAPITAL CORPORATION, a Delaware
corporation (the "Corporation"), does hereby certify that attached hereto is a
true and complete copy of a resolution adopted by a written consent of the Board
of Directors of the Corporation with respect to the Registration Statement,
which resolution is presently in full force and effect.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand and affixed
the seal of the Corporation this 27th day of January, 1999.
/s/ Robert T. Lucas III
----------------------------
Robert T. Lucas III
Assistant Secretary
(Corporate Seal)
FURTHER RESOLVED, that each officer and director who may be required to
execute such Registration Statement or Registration Statements or any amendments
thereto (whether on behalf of the Company or as an officer or director thereof
or by attesting the seal of the Company or otherwise) be and hereby is
authorized to execute a power of attorney appointing Richard J. Osborne, Robert
S. Lilien, and Robert T. Lucas III, and each of them, as true and lawful
attorneys and agents to execute in his or her name, place and stead (in any such
capacity) such Registration Statement or Registration Statements and any and all
amendments thereto and all instruments necessary or advisable in connection
therewith, to attest the seal of the Company thereon and to file the same with
the Securities and Exchange Commission, each of said attorneys and agents to
have power to act with or without the others and to have full power and
authority to do and perform in the name and on behalf of each of such officers
and directors, or both, as the case may be, every act whatsoever necessary or
advisable to be done in the premises as fully and to all intents and purposes as
any such officer or director might or could do in person;
<PAGE>
EXHIBIT 25.1
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
___________________________________________
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
_______________________________________
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
NEW YORK 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 PARK AVENUE
NEW YORK, NEW YORK 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
____________________________________________
DUKE CAPITAL CORPORATION
(Exact name of obligor as specified in its charter)
DELAWARE 56-0282142
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
422 SOUTH CHURCH STREET
CHARLOTTE, NORTH CAROLINA 28202
(Address of principal executive offices) (Zip Code)
____________________________________________
SENIOR NOTES
(Title of the indenture securities)
_________________________________________________
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
New York State Banking Department, State House, Albany, N.Y. 12110.
Board of Governors of the Federal Reserve System, Washington, D.C.
20551.
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y. 10045.
Federal Deposit Insurance Corporation, Washington, D.C. 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now in
effect, including the Organization Certificate and the Certificates of Amendment
dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996,
in connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being
contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to
Form T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act
(see Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 12th day of January, 1999.
THE CHASE MANHATTAN BANK
By /s/ P. Kelly
-----------------------------------
P. Kelly
Vice President
-3-
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business September 30, 1998, 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 MILLIONS
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin ............................................ $ 11,951
Interest-bearing balances .................................... 4,551
Securities:
Held to maturity securities ....................................... 1,740
Available for sale securities ..................................... 48,537
Federal funds sold and securities purchased under
agreements to resell ......................................... 29,730
Loans and lease financing receivables:
Loans and leases, net of unearned income .......... $127,379
Less: Allowance for loan and lease losses ......... 2,719
Less: Allocated transfer risk reserve ............. 0
--------
Loans and leases, net of unearned income,
allowance and reserve ....................................... 124,660
Trading Assets .................................................... 51,549
Premises and fixed assets (including capitalized
leases) ...................................................... 3,009
Other real estate owned ........................................... 272
Investments in unconsolidated subsidiaries and
associated companies ......................................... 300
Customers' liability to this bank on acceptances
outstanding .................................................. 1,329
Intangible assets ................................................. 1,429
Other assets ...................................................... 13,563
--------
TOTAL ASSETS ...................................................... $292,620
========
</TABLE>
- 4 -
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES
<S> <C>
Deposits:
In domestic offices .................................................... $ 98,760
Noninterest-bearing ......................................... $ 39,071
Interest-bearing ............................................ 59,689
---------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's ................................................. 75,403
Noninterest-bearing............................................ $ 3,877
Interest-bearing .............................................. 71,526
Federal funds purchased and securities sold under agreements to repurchase... 34,471
Demand notes issued to the U.S. Treasury .................................... 1,000
Trading liabilities ......................................................... 41,589
Other borrowed money (includes mortgage indebtedness and obligations under
capitalized leases):
With a remaining maturity of one year or less .......................... 3,781
With a remaining maturity of more than one year through three years .... 213
With a remaining maturity of more than three years ..................... 104
Bank's liability on acceptances executed and outstanding .................... 1,329
Subordinated notes and debentures ........................................... 5,408
Other liabilities ........................................................... 12,041
TOTAL LIABILITIES ........................................................... 274,099
---------
EQUITY CAPITAL
Perpetual preferred stock and related surplus ............................... 0
Common stock ................................................................ 1,211
Surplus (exclude all surplus related to preferred stock) ................... 10,441
Undivided profits and capital reserves ...................................... 6,287
Net unrealized holding gains (losses)
on available-for-sale securities ............................................ 566
Cumulative foreign currency translation adjustments ......................... 16
TOTAL EQUITY CAPITAL ........................................................ 18,521
---------
TOTAL LIABILITIES AND EQUITY CAPITAL ........................................ $ 292,620
=========
</TABLE>
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
<PAGE>
Exhibit 25.2
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
---------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
NEW YORK 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 PARK AVENUE
NEW YORK, NEW YORK 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
- --------------------------------------------------------------------------------
DUKE CAPITAL CORPORATION
(Exact name of obligor as specified in its charter)
DELAWARE 56-0282142
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
422 SOUTH CHURCH STREET
CHARLOTTE, NORTH CAROLINA 28202
(Address of principal executive offices) (Zip Code)
--------------------------------------------
JUNIOR SUBORDINATED NOTES
(Title of the indenture securities)
------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
New York State Banking Department, State House, Albany, N.Y. 12110.
Board of Governors of the Federal Reserve System, Washington, D.C.
20551.
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y. 10045.
Federal Deposit Insurance Corporation, Washington, D.C. 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996,
in connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form
T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No. 33-
50010, which is incorporated by reference. On July 14, 1996, in connection with
the merger of Chemical Bank and The Chase Manhattan Bank (National Association),
Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 12th day of January, 1999.
THE CHASE MANHATTAN BANK
By /s/ P. Kelly
-------------------
P. Kelly
Vice President
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business September 30, 1998, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
DOLLAR AMOUNTS
ASSETS IN MILLIONS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.............. $ 11,951
Interest-bearing balances....................................... 4,551
Securities:
Held to maturity securities....................................... 1,740
Available for sale securities..................................... 48,537
Federal funds sold and securities purchased under agreements
to resell....................................................... 29,730
Loans and lease financing receivables:
Loans and leases, net of unearned income ...............$127,379
Less: Allowance for loan and lease losses .............. 2,719
Less: Allocated transfer risk reserve................... 0
--------
Loans and leases, net of unearned income, allowance
and reserve..................................................... 124,660
Trading Assets.................................................... 51,549
Premises and fixed assets (including capitalized leases).......... 3,009
Other real estate owned........................................... 272
Investments in unconsolidated subsidiaries and associated
companies....................................................... 300
Customers' liability to this bank on acceptances outstanding...... 1,329
Intangible assets................................................. 1,429
Other assets...................................................... 13,563
--------
TOTAL ASSETS...................................................... $292,620
========
-4-
<PAGE>
LIABILITIES
Deposits:
In domestic offices ........................................ $ 98,760
Noninterest-bearing ............................... $39,071
Interest-bearing .................................. 59,689
------
In foreign offices, Edge and Agreement, subsidiaries
and IBF's ................................................ 75,403
Noninterest-bearing ............................... $ 3,877
Interest-bearing .................................. 71,526
Federal funds purchased and securities sold under agreements
to repurchase ................................................ 34,471
Demand notes issued to the U.S. Treasury ........................ 1,000
Trading liabilities ............................................. 41,589
Other borrowed money (includes mortgage indebtedness and
obligations under capitalized leases):
With a remaining maturity of one year or less .............. 3,781
With a remaining maturity of more than one year through
three years .............................................. 213
With a remaining maturity of more than three years ......... 104
Bank's liability on acceptances executed and outstanding ........ 1,329
Subordinated notes and debentures ............................... 5,408
Other liabilities ............................................... 12,041
TOTAL LIABILITIES ............................................... 274,099
---------
EQUITY CAPITAL
Perpetual preferred stock and related surplus .................. 0
Common stock ................................................... 1,211
Surplus (exclude all surplus related to preferred stock) ...... 10,441
Undivided profits and capital reserves ......................... 6,287
Net unrealized holding gains (losses) on available-for-sale
securities .................................................. 566
Cumulative foreign currency translation adjustments ............ 16
TOTAL EQUITY CAPITAL ........................................... 18,521
--------
TOTAL LIABILITIES AND EQUITY CAPITAL ........................... $292,620
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR. )
-5-
<PAGE>
Exhibit 25.3-A
___________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
___________________________________________
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
________________________________________
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
NEW YORK 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 PARK AVENUE
NEW YORK, NEW YORK 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
____________________________________________
DUKE CAPITAL FINANCING TRUST III
(Exact name of obligor as specified in its charter)
DELAWARE 51-0379864
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
422 SOUTH CHURCH STREET
CHARLOTTE, NORTH CAROLINA 28202
(Address of principal executive offices) (Zip Code)
--------------------------------------------
TRUST PREFERRED SECURITIES
(Title of the indenture securities)
-------------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
New York State Banking Department, State House, Albany, N.Y. 12110.
Board of Governors of the Federal Reserve System, Washington, D.C.
20551.
Federal Reserve Bank of New York, District No. 2, 33 Liberty
Street, New York, N.Y. 10045.
Federal Deposit Insurance Corporation, Washington, D.C. 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
-2-
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now in
effect, including the Organization Certificate and the Certificates of Amendment
dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996,
in connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being
contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to
Form T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act
(see Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 12th day of January, 1999.
THE CHASE MANHATTAN BANK
By: /s/ P. Kelly
-------------------------------------------
P. Kelly
Vice President
-3-
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business September 30, 1998, 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 MILLIONS
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin............................................ $ 11,951
Interest-bearing balances.................................... 4,551
Securities:
Held to maturity securities...................................... 1,740
Available for sale securities.................................... 48,537
Federal funds sold and securities purchased under
agreements to resell......................................... 29,730
Loans and lease financing receivables:
Loans and leases, net of unearned income $127,379
Less: Allowance for loan and lease losses 2,719
Less: Allocated transfer risk reserve..... 0
Loans and leases, net of unearned income, --------
allowance and reserve........................................ 124,660
Trading Assets................................................... 51,549
Premises and fixed assets (including capitalized
leases)...................................................... 3,009
Other real estate owned.......................................... 272
Investments in unconsolidated subsidiaries and
associated companies......................................... 300
Customers' liability to this bank on acceptances
outstanding.................................................. 1,329
Intangible assets................................................ 1,429
Other assets..................................................... 13,563
------
TOTAL ASSETS..................................................... $ 292,620
=========
</TABLE>
-4-
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES
<S> <C>
Deposits:
In domestic offices............................... $98,760
Noninterest-bearing........................$39,071
Interest-bearing........................... 59,689
------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's............................ 75,403
Noninterest-bearing........................$ 3,877
Interest-bearing........................... 71,526
Federal funds purchased and securities sold under agree-
ments to repurchase................................... 34,471
Demand notes issued to the U.S. Treasury.............. 1,000
Trading liabilities................................... 41,589
Other borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less..... 3,781
With a remaining maturity of more than one year
through three years........................... 213
With a remaining maturity of more
than three years.............................. 104
Bank's liability on acceptances executed and outstanding 1,329
Subordinated notes and debentures..................... 5,408
Other liabilities..................................... 12,041
TOTAL LIABILITIES..................................... 274,099
-------
EQUITY CAPITAL
Perpetual preferred stock and related surplus 0
Common stock.......................................... 1,211
Surplus (exclude all surplus related to preferred stock) 10,441
Undivided profits and capital reserves................ 6,287
Net unrealized holding gains (losses)
on available-for-sale securities...................... 566
Cumulative foreign currency translation adjustments... 16
TOTAL EQUITY CAPITAL.................................. 18,521
--------
TOTAL LIABILITIES AND EQUITY CAPITAL.................. $292,620
========
</TABLE>
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
<PAGE>
Exhibit 25.3-B
-------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
----------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
NEW YORK 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 PARK AVENUE
NEW YORK, NEW YORK 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
- -------------------------------------------------------------------------------
DUKE CAPITAL FINANCING TRUST IV
(Exact name of obligor as specified in its charter)
DELAWARE 62-6349496
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
422 SOUTH CHURCH STREET
CHARLOTTE, NORTH CAROLINA 28202
(Address of principal executive offices) (Zip Code)
----------------------------------------------------
TRUST PREFERRED SECURITIES
(Title of the indenture securities)
-------------------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
New York State Banking Department, State House, Albany, N.Y.
12110.
Board of Governors of the Federal Reserve System, Washington,
D.C. 20551.
Federal Reserve Bank of New York, District No. 2, 33 Liberty
Street, New York, N.Y. 10045.
Federal Deposit Insurance Corporation, Washington, D.C. 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now in
effect, including the Organization Certificate and the Certificates of Amendment
dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being
contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to
Form T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act
(see Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 12th day of January, 1999.
THE CHASE MANHATTAN BANK
By /s/ P. Kelly
---------------------
P. Kelly
Vice President
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business September 30, 1998, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
DOLLAR AMOUNTS
ASSETS IN MILLIONS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.............. $ 11,951
Interest-bearing balances....................................... 4,551
Securities:
Held to maturity securities....................................... 1,740
Available for sale securities..................................... 48,537
Federal funds sold and securities purchased under agreements
to resell....................................................... 29,730
Loans and lease financing receivables:
Loans and leases, net of unearned income ...............$127,379
Less: Allowance for loan and lease losses .............. 2,719
Less: Allocated transfer risk reserve................... 0
--------
Loans and leases, net of unearned income, allowance
and reserve..................................................... 124,660
Trading Assets.................................................... 51,549
Premises and fixed assets (including capitalized leases).......... 3,009
Other real estate owned........................................... 272
Investments in unconsolidated subsidiaries and associated
companies....................................................... 300
Customers' liability to this bank on acceptances outstanding...... 1,329
Intangible assets................................................. 1,429
Other assets...................................................... 13,563
--------
TOTAL ASSETS...................................................... $292,620
========
-4-
<PAGE>
LIABILITIES
Deposits:
In domestic offices ........................................ $ 98,760
Noninterest-bearing ............................... $39,071
Interest-bearing .................................. 59,689
------
In foreign offices, Edge and Agreement, subsidiaries and
IBF's ................................................... 75,403
Noninterest-bearing ............................... $ 3,877
Interest-bearing .................................. 71,526
Federal funds purchased and securities sold under agreements
to repurchase ................................................ 34,471
Demand notes issued to the U.S. Treasury ........................ 1,000
Trading liabilities ............................................. 41,589
Other borrowed money (includes mortgage indebtedness and
obligations under capitalized leases):
With a remaining maturity of one year or less .............. 3,781
With a remaining maturity of more than one year through
three years ............................................. 213
With a remaining maturity of more than three years ......... 104
Bank's liability on acceptances executed and outstanding ........ 1,329
Subordinated notes and debentures ............................... 5,408
Other liabilities ............................................... 12,041
TOTAL LIABILITIES ............................................... 274,099
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus .................. 0
Common stock ................................................... 1,211
Surplus (exclude all surplus related to preferred stock) ...... 10,441
Undivided profits and capital reserves ......................... 6,287
Net unrealized holding gains (losses) on available-for-sale
securities................................................... 566
Cumulative foreign currency translation adjustments ............ 16
TOTAL EQUITY CAPITAL ........................................... 18,521
-------
TOTAL LIABILITIES AND EQUITY CAPITAL ........................... $292,620
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR. )
-5-
<PAGE>
Exhibit 25.3-C
-------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
----------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
NEW YORK 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 PARK AVENUE
NEW YORK, NEW YORK 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
- --------------------------------------------------------------------------------
DUKE CAPITAL FINANCING TRUST V
(Exact name of obligor as specified in its charter)
DELAWARE 62-6349495
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
422 SOUTH CHURCH STREET
CHARLOTTE, NORTH CAROLINA 28202
(Address of principal executive offices) (Zip Code)
--------------------------------------------
TRUST PREFERRED SECURITIES
(Title of the indenture securities)
-------------------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
New York State Banking Department, State House, Albany, N.Y.
12110.
Board of Governors of the Federal Reserve System, Washington,
D.C. 20551.
Federal Reserve Bank of New York, District No. 2, 33 Liberty
Street, New York, N.Y. 10045.
Federal Deposit Insurance Corporation, Washington, D.C. 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now in
effect, including the Organization Certificate and the Certificates of Amendment
dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being
contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to
Form T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act
(see Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 12th day of January, 1999.
THE CHASE MANHATTAN BANK
By /s/ P. Kelly
--------------------------
P. Kelly
Vice President
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business September 30, 1998, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
DOLLAR AMOUNTS
ASSETS IN MILLIONS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.............. $ 11,951
Interest-bearing balances....................................... 4,551
Securities:
Held to maturity securities....................................... 1,740
Available for sale securities..................................... 48,537
Federal funds sold and securities purchased under agreements
to resell....................................................... 29,730
Loans and lease financing receivables:
Loans and leases, net of unearned income ...............$127,379
Less: Allowance for loan and lease losses .............. 2,719
Less: Allocated transfer risk reserve................... 0
--------
Loans and leases, net of unearned income, allowance
and reserve..................................................... 124,660
Trading Assets.................................................... 51,549
Premises and fixed assets (including capitalized leases).......... 3,009
Other real estate owned........................................... 272
Investments in unconsolidated subsidiaries and associated
companies....................................................... 300
Customers' liability to this bank on acceptances outstanding...... 1,329
Intangible assets................................................. 1,429
Other assets...................................................... 13,563
--------
TOTAL ASSETS...................................................... $292,620
========
-4-
<PAGE>
LIABILITIES
Deposits:
In domestic offices ...................................... $ 98,760
Noninterest-bearing ............................. $39,071
Interest-bearing ................................ 59,689
------
In foreign offices, Edge and Agreement, subsidiaries
and IBF's .............................................. 75,403
Noninterest-bearing ............................. $ 3,877
Interest-bearing ................................ 71,526
Federal funds purchased and securities sold under agreements
to repurchase .............................................. 34,471
Demand notes issued to the U.S. Treasury ...................... 1,000
Trading liabilities ........................................... 41,589
Other borrowed money (includes mortgage indebtedness and
obligations under capitalized leases):
With a remaining maturity of one year or less ............ 3,781
With a remaining maturity of more than one year through
three years ............................................ 213
With a remaining maturity of more than three years ....... 104
Bank's liability on acceptances executed and outstanding ...... 1,329
Subordinated notes and debentures ............................. 5,408
Other liabilities ............................................. 12,041
TOTAL LIABILITIES ............................................. 274,099
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus ................ 0
Common stock ................................................. 1,211
Surplus (exclude all surplus related to preferred stock) .... 10,441
Undivided profits and capital reserves ....................... 6,287
Net unrealized holding gains (losses) on
available-for-sale securities .............................. 566
Cumulative foreign currency translation adjustments .......... 16
TOTAL EQUITY CAPITAL ......................................... 18,521
-------
TOTAL LIABILITIES AND EQUITY CAPITAL ......................... $292,620
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR. )
-5-
<PAGE>
Exhibit 25.4-A
___________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
___________________________________________
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
________________________________________
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
NEW YORK 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 PARK AVENUE
NEW YORK, NEW YORK 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
____________________________________________
DUKE CAPITAL CORPORATION
(Exact name of obligor as specified in its charter)
DELAWARE 56-0282142
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
422 SOUTH CHURCH STREET
CHARLOTTE, NORTH CAROLINA 28202
(Address of principal executive offices) (Zip Code)
------------------------------------------
GUARANTEE
DUKE CAPITAL FINANCING TRUST III
TRUST PREFERRED SECURITIES
(Title of the indenture securities)
____________________________________________________________
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
New York State Banking Department, State House, Albany, N.Y. 12110.
Board of Governors of the Federal Reserve System, Washington, D.C.
20551.
Federal Reserve Bank of New York, District No. 2, 33 Liberty
Street, New York, N.Y. 10045.
Federal Deposit Insurance Corporation, Washington, D.C. 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
-2-
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now in
effect, including the Organization Certificate and the Certificates of Amendment
dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996,
in connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being
contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to
Form T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act
(see Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 12th day of January, 1999.
THE CHASE MANHATTAN BANK
By: /s/ P. Kelly
--------------------------------
P. Kelly
Vice President
-3-
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business September 30, 1998, 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 MILLIONS
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin............................................ $ 11,951
Interest-bearing balances.................................... 4,551
Securities:
Held to maturity securities...................................... 1,740
Available for sale securities.................................... 48,537
Federal funds sold and securities purchased under
agreements to resell......................................... 29,730
Loans and lease financing receivables:
Loans and leases, net of unearned income $127,379
Less: Allowance for loan and lease losses 2,719
Less: Allocated transfer risk reserve...... 0
Loans and leases, net of unearned income, --------
allowance and reserve........................................ 124,660
Trading Assets................................................... 51,549
Premises and fixed assets (including capitalized
leases)...................................................... 3,009
Other real estate owned.......................................... 272
Investments in unconsolidated subsidiaries and
associated companies......................................... 300
Customers' liability to this bank on acceptances
outstanding.................................................. 1,329
Intangible assets................................................ 1,429
Other assets..................................................... 13,563
------
TOTAL ASSETS..................................................... $ 292,620
=========
</TABLE>
-4-
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES
<S> <C>
Deposits:
In domestic offices............................. $98,760
Noninterest-bearing......................$39,071
Interest-bearing......................... 59,689
------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's............................ 75,403
Noninterest-bearing........................$ 3,877
Interest-bearing........................... 71,526
Federal funds purchased and securities sold under agree-
ments to repurchase................................... 34,471
Demand notes issued to the U.S. Treasury.............. 1,000
Trading liabilities................................... 41,589
Other borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less..... 3,781
With a remaining maturity of more than one year
through three years........................... 213
With a remaining maturity of more
than three years.............................. 104
Bank's liability on acceptances executed and outstanding 1,329
Subordinated notes and debentures..................... 5,408
Other liabilities..................................... 12,041
TOTAL LIABILITIES..................................... 274,099
-------
EQUITY CAPITAL
Perpetual preferred stock and related surplus 0
Common stock.......................................... 1,211
Surplus (exclude all surplus related to preferred stock) 10,441
Undivided profits and capital reserves................ 6,287
Net unrealized holding gains (losses)
on available-for-sale securities...................... 566
Cumulative foreign currency translation adjustments... 16
TOTAL EQUITY CAPITAL.................................. 18,521
--------
TOTAL LIABILITIES AND EQUITY CAPITAL.................. $292,620
========
</TABLE>
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
<PAGE>
Exhibit 25.4-B
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
----------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
NEW YORK 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 PARK AVENUE
NEW YORK, NEW YORK 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
- --------------------------------------------------------------------------------
DUKE CAPITAL CORPORATION
(Exact name of obligor as specified in its charter)
DELAWARE 56-0282142
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
422 SOUTH CHURCH STREET
CHARLOTTE, NORTH CAROLINA 28202
(Address of principal executive offices) (Zip Code)
------------------------------------------------------------
GUARANTEE
DUKE CAPITAL FINANCING TRUST IV
TRUST PREFERRED SECURITIES
(Title of the indenture securities)
----------------------------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
New York State Banking Department, State House, Albany, N.Y. 12110.
Board of Governors of the Federal Reserve System, Washington, D.C.
20551.
Federal Reserve Bank of New York, District No. 2, 33 Liberty
Street, New York, N.Y. 10045.
Federal Deposit Insurance Corporation, Washington, D.C. 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now in
effect, including the Organization Certificate and the Certificates of Amendment
dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being
contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to
Form T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act
(see Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 12th day of January, 1999.
THE CHASE MANHATTAN BANK
By /s/ P. Kelly
--------------------------
P. Kelly
Vice President
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business September 30, 1998, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
DOLLAR AMOUNTS
ASSETS IN MILLIONS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.............. $ 11,951
Interest-bearing balances....................................... 4,551
Securities:
Held to maturity securities....................................... 1,740
Available for sale securities..................................... 48,537
Federal funds sold and securities purchased under agreements
to resell....................................................... 29,730
Loans and lease financing receivables:
Loans and leases, net of unearned income ...............$127,379
Less: Allowance for loan and lease losses .............. 2,719
Less: Allocated transfer risk reserve................... 0
--------
Loans and leases, net of unearned income, allowance
and reserve..................................................... 124,660
Trading Assets.................................................... 51,549
Premises and fixed assets (including capitalized leases).......... 3,009
Other real estate owned........................................... 272
Investments in unconsolidated subsidiaries and associated
companies....................................................... 300
Customers' liability to this bank on acceptances outstanding...... 1,329
Intangible assets................................................. 1,429
Other assets...................................................... 13,563
--------
TOTAL ASSETS............................................ $292,620
========
-4-
<PAGE>
LIABILITIES
Deposits:
In domestic offices ....................................... $ 98,760
Noninterest-bearing ............................... $39,071
Interest-bearing ................................. 59,689
------
In foreign offices, Edge and Agreement, subsidiaries
and IBF's .............................................. 75,403
Noninterest-bearing .............................. $ 3,877
Interest-bearing ................................. 71,526
Federal funds purchased and securities sold under agreements to
repurchase .................................................. 34,471
Demand notes issued to the U.S. Treasury ....................... 1,000
Trading liabilities ............................................ 41,589
Other borrowed money (includes mortgage indebtedness and
obligations under capitalized leases):
With a remaining maturity of one year or less ............. 3,781
With a remaining maturity of more than one year through
three years ............................................. 213
With a remaining maturity of more than three years ........ 104
Bank's liability on acceptances executed and outstanding ....... 1,329
Subordinated notes and debentures .............................. 5,408
Other liabilities .............................................. 12,041
TOTAL LIABILITIES .............................................. 274,099
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus .................. 0
Common stock ................................................... 1,211
Surplus (exclude all surplus related to preferred stock) ...... 10,441
Undivided profits and capital reserves ......................... 6,287
Net unrealized holding gains (losses) on available-for-sale
securities .................................................. 566
Cumulative foreign currency translation adjustments ............ 16
TOTAL EQUITY CAPITAL ........................................... 18,521
-------
TOTAL LIABILITIES AND EQUITY CAPITAL ........................... $292,620
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR. )
-5-
<PAGE>
Exhibit 25.4-C
-------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
----------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
NEW YORK 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 PARK AVENUE
NEW YORK, NEW YORK 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
- --------------------------------------------------------------------------------
DUKE CAPITAL CORPORATION
(Exact name of obligor as specified in its charter)
DELAWARE 56-0282142
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
422 SOUTH CHURCH STREET
CHARLOTTE, NORTH CAROLINA 28202
(Address of principal executive offices) (Zip Code)
-------------------------------------------
GUARANTEE
DUKE CAPITAL FINANCING TRUST V
TRUST PREFERRED SECURITIES
(Title of the indenture securities)
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
New York State Banking Department, State House, Albany, N.Y.
12110.
Board of Governors of the Federal Reserve System, Washington,
D.C. 20551.
Federal Reserve Bank of New York, District No. 2, 33 Liberty
Street, New York, N.Y. 10045.
Federal Deposit Insurance Corporation, Washington, D.C. 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now in
effect, including the Organization Certificate and the Certificates of Amendment
dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being
contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to
Form T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act
(see Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee,
published pursuant to law or the requirements of its supervising or examining
authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 12th day of January, 1999.
THE CHASE MANHATTAN BANK
By /s/ P. Kelly
-----------------------------
P. Kelly
Vice President
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business September 30, 1998, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
DOLLAR AMOUNTS
ASSETS IN MILLIONS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.............. $ 11,951
Interest-bearing balances....................................... 4,551
Securities:
Held to maturity securities....................................... 1,740
Available for sale securities..................................... 48,537
Federal funds sold and securities purchased under agreements
to resell....................................................... 29,730
Loans and lease financing receivables:
Loans and leases, net of unearned income ...............$127,379
Less: Allowance for loan and lease losses .............. 2,719
Less: Allocated transfer risk reserve................... 0
--------
Loans and leases, net of unearned income, allowance
and reserve..................................................... 124,660
Trading Assets.................................................... 51,549
Premises and fixed assets (including capitalized leases).......... 3,009
Other real estate owned........................................... 272
Investments in unconsolidated subsidiaries and associated
companies....................................................... 300
Customers' liability to this bank on acceptances outstanding...... 1,329
Intangible assets................................................. 1,429
Other assets...................................................... 13,563
--------
TOTAL ASSETS............................................ $292,620
========
-4-
<PAGE>
LIABILITIES
Deposits:
In domestic offices ................................... $ 98,760
Noninterest-bearing ........................... $39,071
Interest-bearing .............................. 59,689
------
In foreign offices, Edge and Agreement, subsidiaries
and IBF's .......................................... 75,403
Noninterest-bearing ........................... $ 3,877
Interest-bearing .............................. 71,526
Federal funds purchased and securities sold under agreements
to repurchase .......................................... 34,471
Demand notes issued to the U.S. Treasury ................... 1,000
Trading liabilities ........................................ 41,589
Other borrowed money (includes mortgage indebtedness and
obligations under capitalized leases):
With a remaining maturity of one year or less ......... 3,781
With a remaining maturity of more than one year
through three years................. ................ 213
With a remaining maturity of more than three years .... 104
Bank's liability on acceptances executed and outstanding ... 1,329
Subordinated notes and debentures .......................... 5,408
Other liabilities .......................................... 12,041
TOTAL LIABILITIES .......................................... 274,099
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus .............. 0
Common stock ............................................... 1,211
Surplus (exclude all surplus related to preferred stock) .. 10,441
Undivided profits and capital reserves ..................... 6,287
Net unrealized holding gains (losses) on available-for-sale
securities .............................................. 566
Cumulative foreign currency translation adjustments ........ 16
TOTAL EQUITY CAPITAL ....................................... 18,521
-------
TOTAL LIABILITIES AND EQUITY CAPITAL ....................... $292,620
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR. )
-5-
