<PAGE>
As filed with the Securities and Exchange Commission on _________________.
Registration No. 33-56939
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------------
AMENDMENT NO. 1
to
FORM S-3
REGISTRATION STATEMENT
Under
The Securities Act of 1933
-----------------------------
CENTRAL MAINE POWER COMPANY
(Exact name of registrant as specified in its charter)
MAINE 01-0042740
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
83 EDISON DRIVE, AUGUSTA, MAINE 04336 (207) 623-3521
(Address, including zip code, and telephone number, including
area code, of registrant's principal office)
------------------------------
DAVID E. MARSH
Vice President, Corporate Services and Chief Financial Officer
and
WILLIAM M. FINN, ESQ.
Corporate Counsel
Central Maine Power Company
83 Edison Drive
Augusta, Maine 04336
(207) 623-3521
(Name, address, including zip code, and telephone number,
including area code, of agents for service)
COPIES TO:
E. ELLSWORTH MCMEEN, III, ESQ. FRANK B. PORTER, JR., ESQ.
SUSAN A. MARSHALL, ESQ. LAURA C. GLYNN, ESQ.
LeBoeuf, Lamb, Greene & MacRae, L.L.P Choate, Hall & Stewart
125 West 55th Street Exchange Place
New York, New York 10019 53 State Street
(212) 424-8000 Boston, Massachusetts 02109
(617) 248-5000
<PAGE>
PROSPECTUS
$150,000,000
CENTRAL MAINE POWER COMPANY
MEDIUM-TERM NOTES, SERIES C
DUE FROM NINE MONTHS TO THIRTY YEARS FROM DATE OF ISSUE
===============
Central Maine Power Company (the "Company") may offer from time to time its
Medium-Term Notes, Series C (the "Notes"), in an aggregate principal amount of
up to $150,000,000. Each Note will mature from nine months to thirty years from
its date of issue, as selected by the initial purchaser and agreed to by the
Company. Unless otherwise set forth in an accompanying Pricing Supplement (the
"Pricing Supplement") to this Prospectus, the Notes will not be redeemable at
the option of the Company or subject to repayment at the option of the Holder
thereof prior to the maturity date thereof set forth in the accompanying Pricing
Supplement (the "Specified Maturity"). See "Description of Notes".
Unless otherwise specified in the applicable Pricing Supplement, each Note
will be registered and will be issued either (i) in book-entry form and
represented by a global security (a "Global Security") registered in the name of
a nominee of The Depository Trust Company, as Depository (the "Depository")
(each such Note represented by a Global Security being referred to herein as a
"Book-Entry Note") or (ii) in certificated form and represented by a certificate
issued in definitive form (a "Certificated Note"), and registered in the name of
the Holder thereof. Beneficial interests in a Global Security representing
Book-Entry Notes will be shown on, and transfers thereof will be effected only
through, records maintained by the Depository (with respect to beneficial
interests of its participants) and its participants. See "Description of Notes-
- -Book-Entry System". Unless otherwise indicated in the applicable Pricing
Supplement, Notes will be issued only in denominations of $25,000 and integral
multiples of $1,000 in excess thereof.
The interest rate on, or interest rate formula pertaining to, each Note will
be established by the Company at the date of issuance of such Note and will be
indicated in an accompanying Pricing Supplement. Interest rates and interest
rate formulas are subject to change by the Company, but, except as otherwise set
forth herein, no such change will affect the interest rate or interest rate
formula pertaining to any Note theretofore issued or which the Company has
agreed to sell. Unless otherwise indicated in the applicable Pricing
Supplement, each Note will bear interest at a fixed rate (a "Fixed Rate Note"),
which may be zero in the case of a Note issued at a price representing a
discount from the principal amount payable at Specified Maturity, or at a
floating rate determined by reference to the CD Rate, the Commercial Paper Rate,
the Federal Funds Rate, LIBOR, the Prime Rate, the Treasury Rate or such other
interest rate formula as may be designated in an accompanying Pricing
Supplement, as adjusted by the Spread and/or Spread Multiplier, if any,
applicable to such Notes (a "Floating Rate Note"). The Notes may be issued as
Original Issue Discount Notes or Extendible Notes. See "Description of Notes".
Unless otherwise specified in the applicable Pricing Supplement, interest on
Fixed Rate Notes will be payable each September 1 and March 1 and at maturity or
upon earlier redemption or repayment. Interest on Floating Rate Notes will be
payable on the dates indicated therein and in the applicable Pricing Supplement.
==================================
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
=================================
<TABLE>
<CAPTION>
================================================================================
PRICE TO AGENT'S PROCEEDS TO
PUBLIC (1) COMMISSION (2) THE COMPANY (2)(3)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
PER NOTE 100.00% .125%-.750% 99.875%-99.250%
TOTAL $150,000,000 $187,500-$1,125,000 $149,812,500-$148,875,000
================================================================================
</TABLE>
(1) Unless otherwise specified in the Pricing Supplement relating thereto, each
Note will be issued at 100% of the principal amount thereof.
(2) The Company will pay Lehman Brothers, Lehman Brothers Inc. (including its
affiliate, Lehman Government Securities Inc.) or PaineWebber Incorporated
or other agents, (each an "Agent," and collectively, the "Agents"), a
commission, in the form of a discount ranging from .125% to .750%, of the
principal amount of any Note, depending on its Specified Maturity, sold
through such Agent. Any Agent, acting as principal, may also purchase
Notes at a discount for resale to one or more investors or one or more
broker-dealers (acting as principal for purposes of resale) at varying
prices related to prevailing market prices at the time of resale, as
determined by such Agent, or if so agreed, at a fixed public offering
price. The Company has agreed to indemnify the Agents against certain
liabilities, including liabilities under the applicable Federal and state
securities laws.
(3) Before deducting offering expenses payable by the Company estimated at
$368,000.
------------------------------------------
The Notes may be offered on a continuing basis by the Company through the
Agents, each of which has agreed to use its reasonable efforts to solicit offers
to purchase the Notes. The Company also may sell Notes to any Agent acting as
principal for resale to one or more investors, or one or more broker-dealers.
The Company has reserved the right to sell Notes directly to investors on its
own behalf and on such sales no commission will be paid. The Notes will not be
listed on any securities exchange, and there can be no assurance that the Notes
offered by this Prospectus will be sold or that there will be a secondary market
for the Notes. The Company reserves the right to withdraw, cancel or modify the
offer made hereby without notice. The Company or any Agent who solicited an
offer to purchase Notes may reject any such offer in whole or in part. See
"Plan of Distribution".
-----------------------------------
LEHMAN BROTHERS PAINEWEBBER INCORPORATED
The date of this Prospectus is December 29, 1994.
<PAGE>
AVAILABLE INFORMATION
Central Maine Power Company (the "Company") is subject to the informational
requirements of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and in accordance therewith files reports and other information with the
Securities and Exchange Commission (the "Commission"). Information, as of
particular dates, concerning directors and officers of the Company, their
remuneration, the principal holders of securities of the Company and any
material interest of such persons in transactions with the Company is disclosed
in proxy statements distributed to shareholders of the Company and filed with
the Commission. Such reports, proxy statements and other information filed by
the Company can be inspected and copied at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549,
and at the Commission's regional offices at 7 World Trade Center, Suite 1300,
New York, New York 10048, and Suite 1400, Northwestern Atrium Center, 500 West
Madison Street, Chicago, Illinois 60661-2511. Copies of such material can also
be obtained at prescribed rates from the Public Reference Section of the
Commission at its principal office at 450 Fifth Street, N.W., Washington, D.C.
20549. Certain securities of the Company are listed on the New York Stock
Exchange, where reports, proxy statements and other information concerning the
Company can also be inspected.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which have heretofore been filed by the Company
with the Commission pursuant to the Exchange Act, are hereby incorporated by
reference in this Prospectus:
1. The Company's Annual Report on Form 10-K for the year ended December
31, 1993.
2. The Company's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1994, June 30, 1994 and September 30, 1994.
3. The Company's Current Reports on Form 8-K dated January 5, 1994,
January 13, 1994 (as amended by Amendment No. 1 on Form 8-K/A dated January
13, 1994), February 3, 1994, April 4, 1994, April 6, 1994, May 16, 1994,
July 5, 1994, October 14, 1994, October 17, 1994, November 22, 1994 and
December 20, 1994.
All documents filed by the Company with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of the offering of the Notes shall be
deemed to be incorporated by reference in this Prospectus and to be a part
hereof from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company hereby undertakes to provide without charge to each person to
whom a copy of this Prospectus has been delivered, on the written or oral
request of any such person, a copy of any or all of the documents referred to
above which have been or may be incorporated in this Prospectus by reference,
other than exhibits to such documents (unless such exhibits are specifically
incorporated by reference in such documents). Requests for such copies should
be directed to William M. Finn, Esq., Secretary and Clerk, Central Maine Power
Company, 83 Edison Drive, Augusta, Maine 04336, telephone number: (207) 623-
3521.
<PAGE>
THE COMPANY
The Company, a Maine corporation organized in 1905, is an investor-owned
electric utility engaged in the generation, purchase, transmission, distribution
and sale of electric energy for the benefit of retail customers in southern and
central Maine and wholesale customers, principally other utilities. The
principal executive offices of the Company are located at 83 Edison Drive,
Augusta, Maine 04336, and the Company's telephone number is (207) 623-3521.
The Company serves more than 500,000 customers in its 11,000 square
mile service area in southern and central Maine. The Company's service area
contains the bulk of Maine's industrial centers and includes about 77 percent of
the total population of the State. The Company's industrial and commercial
customers include major producers of pulp and paper products, producers of
chemicals, plastics, electric components, processed food and footwear, and
shipbuilders.
RATIO OF EARNINGS TO FIXED CHARGES
As computed in accordance with Item 503(d) of Regulation S-K of the
Commission, the Company's unaudited ratio of earnings to fixed charges for the
twelve-month period ended September 30, 1994 was 2.8, and such ratio for each of
the calendar years (the Company's fiscal year being a calendar year) in the
period 1989 through 1993, inclusive, was 2.3, 2.0, 2.4, 2.5 and 2.7,
respectively. (For a discussion of the Company's Alternative Rate Plan and
substantial restructuring charges to 1994 earnings connected therewith,
reference is made to the Company's Current Reports on Form 8-K dated October 14
and December 20, 1994, incorporated by reference herein.)
USE OF PROCEEDS
The net proceeds to be received by the Company from the sale or sales of
the Notes will be used for general corporate purposes, including, but not
limited to, construction financing, funding of energy management and customer
conservation programs, and the repayment of short-term borrowings and other
forms of indebtedness.
DESCRIPTION OF NOTES
The following description sets forth certain general terms and provisions
of the Notes. The particular terms of any Notes will be described in the
Pricing Supplement relating to such Notes. The statements made herein are a
summary only, do not purport to be complete, and are qualified in their entirety
by the detailed provisions of an Indenture between the Company and The Bank of
New York (the "Trustee"), dated as of August 1, 1989, as supplemented by the
First Supplemental Indenture, dated as of August 7, 1989, the Second
Supplemental Indenture dated as of January 10, 1992 and the Third Supplemental
Indenture, dated as of December 15, 1994 (collectively, the "Indenture").
Copies of the Indenture, including supplemental indentures, are filed or
incorporated by reference as exhibits to the Registration Statement, and such
exhibits are incorporated herein by reference. All article and section
references are references to articles and sections of the Indenture.
-2-
<PAGE>
GENERAL
The Notes will be issued under the Indenture, will be unsecured and will
rank equally with the Company's other unsecured senior indebtedness. The Notes
are limited to an aggregate principal amount of $150,000,000 and will constitute
the third series of Securities (as defined below) issued under the Indenture.
Under the Indenture, the Company may issue from time to time its notes,
debentures or other evidences of indebtedness, in one or more series
(hereinafter referred to as the "Securities"). The Indenture does not limit the
amount of Securities which may be issued thereunder and additional Securities
may be issued thereunder up to the aggregate principal amount which may be
authorized from time to time by the Company. Capitalized terms used but not
otherwise defined herein have the meanings specified in the Indenture.
The holders of the Company's Preferred Stock have specifically consented to
the issuance of unsecured medium-term notes in an aggregate principal amount of
$150,000,000 outstanding at any one time. Medium-term notes in such an amount
are therefore not subject to the Company's charter restriction on the issuance
of unsecured securities, which (except in the case of certain refundings) limits
such unsecured securities to an amount equal to 20 percent of the aggregate of
all outstanding secured indebtedness, plus capital and surplus (with certain
adjustments). The Notes offered hereby and the Medium-Term Notes, Series A and
the Medium-Term Notes, Series B previously issued under the Indenture constitute
unsecured medium-term notes for the purpose of the foregoing consent. As of the
date of this Prospectus, $135,000,000 in aggregate principal amount of medium-
term notes is outstanding.
In the event that the aggregate principal amount of unsecured medium-term
notes at any time outstanding (including, without limitation, the Notes, the
Medium-Term Notes, Series A and the Medium-Term Notes, Series B) exceeds
$150,000,000, the excess of such amount would be subject to the charter
restriction described above. The Company's Board of Directors and the Maine
Public Utilities Commission ("MPUC") have approved the issuance of up to
$150,000,000 in aggregate principal amount of medium-term notes of any series at
any one time outstanding and the issuance of medium-term notes in excess of that
amount would require further approvals. The MPUC order relating to the Notes
provides that the initial interest rate on any Medium-Term Notes, Series C,
shall not exceed 12 percent per annum unless the MPUC approves such rate.
The Notes may be offered on a continuing basis and each Note will mature
from nine months to thirty years from its date of issue, as selected by the
initial purchaser and agreed to by the Company, and may be subject to redemption
at the option of the Company or repayment at the option of the holder prior to
Maturity (as set forth below under "Optional Redemption" and "Repayment at
Holder's Option") at the price or prices specified in the applicable Pricing
Supplement. Each Note will be either (i) a Fixed Rate Note, which may bear
interest at a rate of zero in the case of certain Notes issued at an Issue Price
(as defined below) representing a discount from the principal amount payable at
its Specified Maturity (a "Zero-Coupon Note"), or (ii) a Floating Rate Note
which will bear interest at a rate determined by reference to an interest rate
basis or combination of interest rate bases (the "Base Rate") specified in the
applicable Pricing Supplement that may be adjusted by a Spread and/or Spread
Multiplier (each as defined below).
Each Note will be issued initially as either a Book-Entry Note or a
Certificated Note in fully registered form without coupons. Except as set forth
below under "Book-Entry System", Book-Entry Notes will not be exchangeable for
Certificated Notes.
The authorized denominations of the Notes will be $25,000 or any larger
amount that is an integral multiple of $1,000.
-3-
<PAGE>
"Business Day" means any day, other than a Saturday or Sunday, that meets
each of the following applicable requirements: the day is (a) not a day on which
banking institutions are authorized or required by law or regulation to be
closed in The City of New York and (b) with respect to LIBOR Notes, a London
Banking Day. "London Banking Day" means any day on which dealings in deposits
in U.S. dollars are transacted in the London interbank market.
"Index Maturity" means, with respect to a Floating Rate Note, the period to
maturity of the instrument or obligation on which the interest rate formula is
based, as specified in the applicable Pricing Supplement.
"Original Issue Discount Note" means, (i) a Note, including any Zero Coupon
Note, that has a stated redemption price at Maturity that exceeds its Issue
Price (as defined for U.S. Federal Income tax purposes) by at least 0.25% of its
principal amount multiplied by the number of full years from the Original Issue
Date to the Specified Maturity for such Note and (ii) any other Note designated
by the Company as issued with original issue discount for United States Federal
income tax purposes.
The Pricing Supplement relating to each Note will describe the following
terms: (1) whether such Note is a Fixed Rate Note or a Floating Rate Note, (2)
the price (expressed as a percentage of the aggregate principal amount thereof)
at which such Note will be issued (the "Issue Price"); (3) the date on which
such Note will be issued (the "Original Issue Date"); (4) the date on which such
Note will mature (the "Specified Maturity"); (5) if such Note is a Fixed Rate
Note, the rate per annum at which such Note will bear interest, if any, and the
date or dates on which interest will be payable (each, an "Interest Payment
Date"), if other than March 1 and September 1 and, if so stated in the
applicable Pricing Supplement, that such rate may be changed by the Company
prior to the Specified Maturity, and, if so, the Optional Reset Dates (as
defined below) and the basis or formula for such change, if any; (6) if such
Note is a Floating Rate Note, the Base Rate, the Initial Interest Rate, if
available, the Interest Reset Period, the Interest Reset Dates, the Interest
Determination Dates, the Calculation Dates, the Interest Payment Period, the
Interest Payment Dates, the Index Maturity, the Maximum Interest Rate and the
Minimum Interest Rate, if any, and the Spread and/or Spread Multiplier, if any
(all as defined below), and any other terms relating to the particular method of
calculating the interest rate for such Note and, if so specified in the
applicable Pricing Supplement, that any such Spread and/or Spread Multiplier may
be changed by the Company prior to the Specified Maturity and, if so, the
Optional Reset Dates (as defined below) and the basis or formula for such
change, if any; (7) whether such Note is an Original Issue Discount Note, and if
so, the yield to maturity; (8) the regular record date or dates (a "Regular
Record Date") if other than as set forth below with respect to Fixed Rate Notes
and Floating Rate Notes; (9) certain specified United States Federal income tax
consequences of the purchase, ownership and disposition of such Note, if
applicable; (10) whether such Note may be redeemed at the option of the Company
or repaid at the option of the Holder prior to the Specified Maturity and, if
so, the provisions relating to such redemption or repayment; (11) whether such
Note will be issued initially as a Book-Entry Note or a Certificated Note; and
(12) any other terms of such Note not inconsistent with the provisions of the
Indenture.
PAYMENT OF PRINCIPAL AND INTEREST
Until the Notes are paid, or payment thereof is provided for, the Company
will, at all times, maintain a paying agent (the "Paying Agent") in The City of
New York capable of performing the duties described herein to be performed by
the Paying Agent. The Company has initially appointed The Bank of New York as
Paying Agent.
-4-
<PAGE>
Payments of principal and interest (and premium, if any) to Beneficial
Owners (as defined below) of Book-Entry Notes are expected to be made in
accordance with the Depository's and its participants' procedures in effect from
time to time as described below under "Book-Entry System".
Unless otherwise specified in the applicable Pricing Supplement, payments
of interest on Certificated Notes (other than interest payable at Maturity (as
defined below)), will be made by mailing a check to the Holder at the address of
such Holder appearing on the Register on the applicable Regular Record Date.
Unless otherwise specified in the applicable Pricing Supplement, principal and
any premium and interest payable with respect to any Certificated Note at
Maturity (as defined below) will be paid in immediately available funds upon
surrender of such Note at the office of the Paying Agent. "Maturity" means the
date on which the principal of a Note becomes due and payable in accordance with
its terms and the terms of the Indenture, whether at Specified Maturity or
earlier by declaration of acceleration, call for redemption or otherwise.
Any payment required to be made in respect of a Note on a day that is not a
Business Day for such Note need not be made on such date, but may be made on the
next succeeding Business Day (except that in the case of a LIBOR Note, if such
Business Day is in the next succeeding calendar month, such payment shall be
made on the immediately preceding Business Day) with the same force and effect
as if made on such date, and no additional interest shall accrue as a result of
such delayed payment.
Unless otherwise specified in the applicable Pricing Supplement, if the
principal of any Original Issue Discount Note is declared to be due and payable
immediately as described under "Events of Default" below, the amount of
principal due and payable with respect to such Note shall be limited to the
Amortized Face Amount of such Note as of the date of such declaration. The
"Amortized Face Amount" of an Original Issue Discount Note that does not bear
stated interest shall be an amount equal to the sum of (i) the principal amount
of such Note multiplied by the Issue Price set forth in the applicable Pricing
Supplement plus (ii) the portion of the difference between the dollar amount
determined pursuant to the preceding clause (i) and the principal amount of such
Note that has accrued at the yield to maturity set forth in the Pricing
Supplement (computed in accordance with generally accepted financial practices)
to such date of declaration, but in no event shall the Amortized Face Amount of
an Original Issue Discount Note exceed its principal amount.
INTEREST AND INTEREST RATES
Each Note other than certain Original Issue Discount Notes will bear
interest from its Original Issue Date or from the most recent Interest Payment
Date to which interest on such Note has been paid or duly provided for at a
fixed rate or rates per annum, or at a rate or rates per annum determined
pursuant to a Base Rate or Rates stated therein and in the applicable Pricing
Supplement that may be adjusted by a Spread and/or Spread Multiplier, until the
principal thereof is paid or made available for payment. Interest will be
payable on each Interest Payment Date and at Maturity. Interest rates, Base
Rates, Spreads and Spread Multipliers are subject to change by the Company from
time to time but no such change will affect any Note theretofore issued or which
the Company has agreed to sell, except as otherwise set forth herein.
Interest payable and punctually paid or duly provided for on any Interest
Payment Date will be paid to the person in whose name a Note is registered at
the close of business on the Regular Record Date next preceding such Interest
Payment Date; provided, however, that the first payment of interest on any Note
with an Original Issue Date between a Regular Record Date and the succeeding
Interest Payment
-5-
<PAGE>
Date will be made on the Interest Payment Date following the next succeeding
Regular Record Date to the registered owner on such next succeeding Regular
Record Date; and provided, further, that interest payable at Maturity will be
payable to the person to whom principal shall be payable. The "Regular Record
Date" with respect to any Interest Payment Date shall be the date fifteen
calendar days immediately preceding such Interest Payment Date whether or not
such date shall be a Business Day.
All percentages resulting from any calculations will be rounded upwards, if
necessary, to the nearest one hundred-thousandth of a percentage point
(.0000001), with five one-millionths of a percentage point being rounded upwards
(e.g., 9.876545% (or .09876545) being rounded to 9.87655% (or .0987655)), and
all dollar amounts used in or resulting from such calculations on the Notes will
be rounded to the nearest one cent (with one-half cent being rounded upwards).
FIXED RATE NOTES
Each Fixed Rate Note will bear interest from its Original Issue Date at the
rate per annum stated in the applicable Pricing Supplement and on the face
thereof until the principal amount thereof is paid or made available for
payment. Payments of interest on any Fixed Rate Note with respect to any
Interest Payment Date and at Maturity will include interest from and including
the Original Issue Date or the next preceding Interest Payment Date to which
interest has been paid or duly provided for, to but excluding the applicable
Interest Payment Date or the date of Maturity. Unless otherwise set forth in an
applicable Pricing Supplement, interest on each Fixed Rate Note will be payable
semi-annually each September 1 and March 1 and at Maturity. Interest on Fixed
Rate Notes will be computed on the basis of a 360-day year of twelve 30-day
months.
FLOATING RATE NOTES
Each Floating Rate Note will bear interest at a rate or rates determined by
reference to the Base Rate plus or minus the Spread, if any, and/or multiplied
by the Spread Multiplier, if any (each as specified in the applicable Pricing
Supplement) until the principal thereof is paid or made available for payment.
The "Spread" is the number of basis points (one basis point equals one one-
hundredth of a percentage point) specified in the applicable Pricing Supplement
as being applicable to such Floating Rate Note, and the "Spread Multiplier" is
the percentage specified in the applicable Pricing Supplement as being
applicable to such Note. Any Floating Rate Note may also have either or both of
the following: (i) a maximum numerical interest rate limitation, or ceiling, on
the rate of interest which may accrue during any interest period (the "Maximum
Interest Rate"); and (ii) a minimum numerical interest rate limitation, or
floor, on the rate of interest which may accrue during any interest period (the
"Minimum Interest Rate"). The applicable Pricing Supplement will designate one
of the following Base Rates as applicable to each Floating Rate Note: (a) the
CD Rate (a "CD Rate Note"), (b) the Commercial Paper Rate (a "Commercial Paper
Rate Note"), (c) the Federal Funds Rate (a "Federal Funds Rate Note"), (d) LIBOR
(a "LIBOR Note"), (e) the Prime Rate (a "Prime Rate Note"), (f) the Treasury
Rate (a "Treasury Rate Note"), or (g) such other Base Rate as is set forth in
the Pricing Supplement and on the face of such Floating Rate Note.
Each Floating Rate Note will bear interest from its Original Issue Date to
the first Interest Reset Date (as defined below) for such Note at the Initial
Interest Rate (the "Initial Interest Rate") set forth on the face thereof and in
the applicable Pricing Supplement. Thereafter, the interest rate on each
Floating Rate Note for each Interest Reset Period (as defined below) will be
equal to the interest rate calculated by reference to the Base Rate or Rates
specified on the face thereof and in the applicable Pricing
-6-
<PAGE>
Supplement plus or minus the Spread, if any, and/or times the Spread Multiplier,
if any. The Spread and/or Spread Multiplier for a Floating Rate Note may be
subject to adjustment during an Interest Reset Period under circumstances
specified therein and in the applicable Pricing Supplement.
The Company will appoint, and enter into an agreement with, an agent (a
"Calculation Agent") to calculate interest rates on Floating Rate Notes. Unless
otherwise specified in the applicable Pricing Supplement, the Calculation Agent
for each Floating Rate Note will be the Trustee. All determinations to be made
by the Calculation Agent shall be at its sole discretion and shall, in the
absence of manifest error, be conclusive for all purposes and binding on the
Holders of Notes.
The rate of interest on each Floating Rate Note will be reset daily,
weekly, monthly, quarterly, semi-annually or annually (each an "Interest Reset
Period"), as specified in the applicable Pricing Supplement and on the face of
such Floating Rate Note. Unless otherwise specified in the applicable Pricing
Supplement, the date or dates on which interest will be reset (each an "Interest
Reset Date") will be, in the case of Floating Rate Notes that reset daily, each
Business Day; in the case of Floating Rate Notes that reset weekly (other than
Treasury Rate Notes), Wednesday of each week; in the case of Treasury Rate Notes
that reset weekly, Tuesday of each week, except as provided below; in the case
of Floating Rate Notes that reset monthly, the third Wednesday of each month; in
the case of Floating Rate Notes that reset quarterly, the third Wednesday of
each of the four months specified in the applicable Pricing Supplement and on
the face of such Floating Rate Note; in the case of Floating Rate Notes that
reset semi-annually, the third Wednesday of each of the two months specified in
the applicable Pricing Supplement and on the face of such Floating Rate Note;
and in the case of Floating Rate Notes that reset annually, the third Wednesday
of the month specified in the applicable Pricing Supplement and on the face of
such Floating Rate Note. If any Interest Reset Date for any Floating Rate Note
is not a Business Day, such Interest Reset Date shall be postponed to the next
day that is a Business Day, except, in the case of a LIBOR Note, if such
Business Day is in the next succeeding calendar month, such Interest Reset Date
shall be the immediately preceding Business Day. If an auction for Treasury
bills (as described below) falls on a day that is an Interest Reset Date for
Treasury Rate Notes, the Interest Reset Date shall be the following day that is
a Business Day.
The interest rate for each Interest Reset Period will be the rate
determined by the Calculation Agent on the Calculation Date (as defined below)
pertaining to the Interest Determination Date pertaining to the Interest Reset
Date for such Interest Reset Period. Unless otherwise specified in the
applicable Pricing Supplement, the "Interest Determination Date" pertaining to
an Interest Reset Date for CD Rate Notes, Commercial Paper Rate Notes, Federal
Funds Rate Notes and Prime Rate Notes will be the second Business Day next
preceding such Interest Reset Date. Unless otherwise specified in the
applicable Pricing Supplement, the Interest Determination Date pertaining to an
Interest Reset Date for a LIBOR Note will be the second London Banking Day next
preceding such Interest Reset Date. Unless otherwise specified in the
applicable Pricing Supplement, the Interest Determination Date pertaining to an
Interest Reset Date for a Treasury Rate Note will be the day of the week in
which such Interest Reset Date falls on which Treasury bills of the Index
Maturity specified on the face of the Treasury Rate Notes would normally be
auctioned. Treasury bills are normally sold at auction on Monday of each week,
unless that day is a legal holiday, in which case the auction is usually held on
the following Tuesday, except that such auction may be held on the preceding
Friday. If, as the result of a legal holiday, an auction is so held on the
preceding Friday, such Friday will be the Interest Determination Date pertaining
to the Interest Reset Date for Treasury Rate Notes occurring in the next
succeeding week. If an auction falls on a day that is an Interest Reset Date
for Treasury Rate Notes, such Interest Reset Date will be the first Business Day
immediately following such auction date.
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Unless otherwise specified in the applicable Pricing Supplement, the
"Calculation Date", where applicable, pertaining to an Interest Determination
Date will be the earlier of (i) the tenth calendar day after such Interest
Determination Date or if such day is not a Business Day, the next succeeding
Business Day or (ii) the Business Day preceding the applicable Interest Payment
Date or Maturity, as the case may be.
Unless otherwise indicated in the applicable Pricing Supplement, interest
on each Floating Rate Note will be payable monthly, quarterly, semi-annually or
annually (the "Interest Payment Period"). Except as provided below or in the
applicable Pricing Supplement, the Interest Payment Dates will be, (i) in the
case of Floating Rate Notes with a daily, weekly or monthly Interest Reset
Period, on the third Wednesday of each month or on the third Wednesday of March,
June, September and December of each year, as specified in the applicable
Pricing Supplement and on the face of such Floating Rate Note; (ii) in the case
of Floating Rate Notes with a quarterly Interest Reset Period, on the third
Wednesday of March, June, September and December of each year; (iii) in the case
of Floating Rate Notes with a semi-annual Interest Reset Period, on the third
Wednesday of each of two months of each year specified in the applicable Pricing
Supplement and on the face of such Floating Rate Note; and (iv) in the case of
Floating Rate Notes with an annual Interest Reset Period, on the third Wednesday
of one month of each year specified in the applicable Pricing Supplement and on
the face of such Floating Rate Note and, in each case, at Maturity. If any
Interest Payment Date other than Maturity for any Floating Rate Note would
otherwise be a day that is not a Business Day, such Interest Payment Date shall
be postponed to the next day that is a Business Day, except that in the case of
a LIBOR Note, if such Business Day is in the next succeeding calendar month,
such Interest Payment Date shall be the immediately preceding Business Day. If
Maturity for any Floating Rate Note falls on a day that is not a Business Day,
payment of principal, premium, if any, and interest with respect to such Note
will be made on the next succeeding Business Day with the same force and effect
as if made on the due date, and no interest shall be payable on the date of
payment for the period from and after the due date.
Unless otherwise indicated in the applicable Pricing Supplement, interest
payments on each Interest Payment Date and at Maturity for Floating Rate Notes
will include accrued interest from and including the Original Issue Date or the
next preceding Interest Payment Date to which interest has been paid or duly
provided for, to but excluding the applicable Interest Payment Date or the date
of Maturity. Accrued interest will be calculated by multiplying the principal
amount of a Floating Rate Note by an accrued interest factor. This accrued
interest factor will be computed by adding the interest factor calculated for
each day in the period for which accrued interest is being calculated. The
interest factor (expressed as a decimal rounded upwards, if necessary, to the
next higher one hundred-thousandth of a percentage point) for each such day will
be computed by dividing the interest rate applicable to such day by 360 in the
case of CD Rate Notes, Commercial Paper Rate Notes, Federal Funds Rate Notes,
LIBOR Notes and Prime Rate Notes, or by the actual number of days in the year,
in the case of Treasury Rate Notes. The interest rate in effect on each day
will be (a) if such day is an Interest Reset Date, the interest rate with
respect to the Interest Determination Date pertaining to such Interest Reset
Date, or (b) if such day is not an Interest Reset Date, the interest rate with
respect to the Interest Determination Date pertaining to the next preceding
Interest Reset Date, subject in either case to any Maximum or Minimum Interest
Rate limitation referred to above and to any adjustment by a Spread and/or a
Spread Multiplier referred to above; provided, however, that the interest rate
in effect for the period from the Original Issue Date to the first Interest
Reset Date set forth in the Pricing Supplement with respect to a Floating Rate
Note will be the "Initial Interest Rate" specified in the applicable Pricing
Supplement. The interest rate on the Floating Rate Notes will in no event be
higher than the maximum rate permitted by applicable law.
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CD RATE NOTES
Each CD Rate Note will bear interest at the interest rate (calculated with
reference to the CD Rate and the Spread and/or Spread Multiplier, if any)
specified in such CD Rate Note and in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, "CD Rate"
means, with respect to any applicable Interest Determination Date, the rate on
such date for negotiable certificates of deposit having the Index Maturity
designated in the applicable Pricing Supplement, as such rate is published by
the Board of Governors of the Federal Reserve System in "Statistical Release
H.15(519), Selected Interest Rates", or any successor publication of the Board
of Governors of the Federal Reserve System ("H.15(519)") under the heading "CDs
(Secondary Market)" or, if such rate is not published by 3:00 P.M., New York
City time, on the Calculation Date pertaining to such Interest Determination
Date, the CD Rate for such Interest Determination Date will be the rate on such
Interest Determination Date for negotiable certificates of deposit having the
Index Maturity designated in the applicable Pricing Supplement as published by
the Federal Reserve Bank of New York in its daily statistical release "Composite
3:30 P.M. Quotations for U.S. Government Securities" or any successor
publication of the Federal Reserve Bank of New York ("Composite Quotations")
under the heading "Certificates of Deposit". If such rate is not published in
either H.15(519) or Composite Quotations by 3:00 P.M., New York City time, on
the Calculation Date pertaining to such Interest Determination Date, then the CD
Rate for such Interest Determination Date will be calculated by the Calculation
Agent and will be the arithmetic mean of the secondary market offered rates as
of 10:00 A.M., New York City time, on such Interest Determination Date of three
leading nonbank dealers in negotiable U.S. dollar certificates of deposit in The
City of New York selected by the Calculation Agent for negotiable certificates
of deposit of major United States money center banks of the highest credit
standing (in the market for negotiable certificates of deposit) with a remaining
maturity closest to the Index Maturity designated in the applicable Pricing
Supplement in a denomination of $5,000,000; provided, however, that if the
dealers selected as aforesaid by the Calculation Agent are not quoting as
mentioned in this sentence, the CD Rate with respect to such Interest
Determination Date will be the CD Rate in effect on such Interest Determination
Date.
COMMERCIAL PAPER RATE NOTES
Each Commercial Paper Rate Note will bear interest at the interest rate
(calculated with reference to the Commercial Paper Rate and the Spread and/or
Spread Multiplier, if any) specified in such Commercial Paper Rate Note and in
the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement,
"Commercial Paper Rate" means, with respect to any applicable Interest
Determination Date, the Money Market Yield (calculated as described below) of
the rate on such date for commercial paper having the Index Maturity designated
in the applicable Pricing Supplement, as such rate is published in H.15(519),
under the heading "Commercial Paper" or, if such rate is not published by 3:00
P.M., New York City time, on the Calculation Date pertaining to such Interest
Determination Date, the Commercial Paper Rate for such Interest Determination
Date will be the Money Market Yield of the rate on such Interest Determination
Date for commercial paper having the Index Maturity designated in the applicable
Pricing Supplement as published in Composite Quotations under the heading
"Commercial Paper". If such rate is not published in either H.15(519) or
Composite Quotations by 3:00 P.M., New York City time, on the Calculation Date
pertaining to such Interest Determination Date, then the Commercial Paper Rate
for such
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Interest Determination Date shall be calculated by the Calculation Agent and
shall be the Money Market Yield of the arithmetic mean of the offered rates as
of 11:00 A.M., New York City time, on such Interest Determination Date of three
leading dealers of commercial paper in The City of New York selected by the
Calculation Agent for commercial paper having the Index Maturity designated in
the applicable Pricing Supplement, placed for an industrial issuer whose bond
rating is "AA", or the equivalent, from a nationally recognized rating agency;
provided, however, that if the dealers selected as aforesaid by the Calculation
Agent are not quoting as mentioned in this sentence, the Commercial Paper Rate
with respect to such Interest Determination Date will be the Commercial Paper
Rate in effect on such Interest Determination Date.
"Money Market Yield" means a yield (expressed as a percentage rounded to
the nearest one hundred-thousandth of a percentage point) calculated in
accordance with the following formula:
D X 360
Money Market Yield = ------------------ X 100
360 - (D X M)
where "D" refers to the per annum rate for commercial paper quoted on a bank
discount basis and expressed as a decimal, and "M" refers to the actual number
of days in the interest period for which interest is being calculated.
FEDERAL FUNDS RATE NOTES
Each Federal Funds Rate Note will bear interest at the interest rate
(calculated with reference to the Federal Funds Rate and the Spread and/or
Spread Multiplier, if any) specified in such Federal Funds Rate Note and in the
applicable Pricing Supplement.
Unless otherwise indicated in the applicable Pricing Supplement, "Federal
Funds Rate" means, with respect to any applicable Interest Determination Date,
the rate on such date for Federal Funds as published in H.15(519) under the
heading "Federal Funds (Effective)" or, if such rate is not published by 3:00
P.M., New York City time, on the Calculation Date pertaining to such Interest
Determination Date, the Federal Funds Rate for such Interest Determination Date
will be the rate on such Interest Determination Date as published in Composite
Quotations under the heading "Federal Funds/Effective Rate". If such rate is
not published in either H.15(519) or Composite Quotations by 3:00 P.M., New York
City time, on the Calculation Date pertaining to such Interest Determination
Date, then the Federal Funds Rate for such Interest Determination Date will be
calculated by the Calculation Agent and will be the arithmetic mean of the
rates, as of 9:00 A.M., New York City time, on such Interest Determination Date,
for the last transaction in overnight Federal Funds arranged by three leading
brokers of Federal Funds transactions in The City of New York selected by the
Calculation Agent; provided, however, that if the brokers selected as aforesaid
by the Calculation Agent are not quoting as mentioned in this sentence, the
Federal Funds Rate with respect to such Interest Determination Date will be the
Federal Funds Rate in effect on such Interest Determination Date.
LIBOR NOTES
Each LIBOR Note will bear interest at the interest rate (calculated with
reference to LIBOR and the Spread and/or Spread Multiplier, if any) specified in
such LIBOR Note and in the applicable Pricing Supplement.
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Unless otherwise specified in the applicable Pricing Supplement, "LIBOR"
means, with respect to any applicable Interest Determination Date, the rate
determined in accordance with the following provisions:
(i) With respect to any such Interest Determination Date, LIBOR will
be either: (a) if "LIBOR Reuters" is specified in the LIBOR Note and the
applicable Pricing Supplement, the arithmetic mean of the offered rates
(unless the specified designated LIBOR Page (as defined below) by its terms
provides only for a single rate, in which case such single rate shall be
used) for deposits in United States dollars having the Index Maturity
designated in such LIBOR Note and the applicable Pricing Supplement,
commencing on the second London Banking Day immediately following the
Interest Determination Date, which appear on the Designated LIBOR Page
specified in such LIBOR Note and the applicable Pricing Supplement as of
11:00 A.M., London time, on that Interest Determination Date, if at least
two such offered rates appear (unless, as aforesaid, only a single rate is
required) on such Designated LIBOR Page, or (b) if "LIBOR Telerate" is
specified in such LIBOR Note and the applicable Pricing Supplement, the
rate for deposits in United States dollars having the Index Maturity
specified in such LIBOR Note and the applicable Pricing Supplement,
commencing on the second London Banking Day immediately following such
Interest Determination Date, which appears on the Designated LIBOR Page
designated in such LIBOR Note and the applicable Pricing Supplement as of
11:00 A.M. London time on that Interest Determination Date.
Notwithstanding the foregoing, if fewer than two offered rates appear on
the Designated LIBOR Page with respect to LIBOR Reuters (unless the
specified Designated LIBOR Page with respect to LIBOR Reuters by its terms
provides only for a single rate, in which case such single rate shall be
used), or if no rate appears on the Designated LIBOR Page with respect to
LIBOR Telerate, whichever may be applicable, LIBOR in respect of the
related Interest Determination Date will be determined as if the parties
had specified the rate described in clause (ii) below.
(ii) With respect to any such Interest Determination Date on which
fewer than two offered rates appear on the Designated LIBOR Page with
respect to LIBOR Reuters (unless the Designated LIBOR Page by its terms
provides only for a single rate, in which case such single rate shall be
used), or if no rate appears on the Designated LIBOR Page with respect to
LIBOR Telerate, as the case may be, the Calculation Agent will request the
principal London office of each of four major banks in the London interbank
market selected by the Calculation Agent to provide the Calculation Agent
with its offered rate quotation for deposits in United States dollars for
the period of the Index Maturity designated in such LIBOR Note and the
applicable Pricing Supplement, commencing on the second London Banking Day
immediately following such Interest Determination Date, to prime banks in
the London interbank market as of 11:00 A.M., London time, on such Interest
Determination Date and in a principal amount that is representative for a
single transaction in United States dollars in such market at such time.
If at least two such quotations are provided, LIBOR determined on such
Interest Determination Date will be the arithmetic mean of such quotations.
If fewer than two quotations are provided, LIBOR determined on such
Interest Determination Date will be the arithmetic mean of the rates quoted
as of 11:00 A.M. in The City of New York, on such Interest Determination
Date by three major banks in The City of New York selected by the
Calculation Agent for loans in United States dollars to leading banks,
having the Index Maturity designated in such LIBOR Note and the applicable
Pricing Supplement in a principal amount that is representative for a
single transaction in United States dollars in such market at such time;
provided, however, that if the banks so selected by the Calculation Agent
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are not quoting as mentioned in this sentence, LIBOR
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determined on such Interest Determination Date will be LIBOR in effect on
such Interest Determination Date.
"Designated LIBOR Page" means either (a) the display on the Reuters Monitor
Money Rates Service for the purpose of displaying the London interbank rates of
major banks for United States dollars (if "LIBOR Reuters" is designated in the
LIBOR Note and the applicable Pricing Supplement), or (b) the display on the Dow
Jones Telerate Service for the purpose of displaying the London interbank rates
of major banks for United States dollars (if "LIBOR Telerate" is designated in
the Note and the applicable Pricing Supplement). If neither LIBOR Reuters nor
LIBOR Telerate is specified in the LIBOR Note and the applicable Pricing
Supplement, LIBOR will be determined as if LIBOR Telerate (page 3750) had been
chosen.
PRIME RATE NOTES
Each Prime Rate Note will bear interest at the interest rate (calculated
with reference to the Prime Rate and the Spread and/or Spread Multiplier, if
any) specified in such Prime Rate Note and in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, "Prime
Rate" means, with respect to any applicable Interest Determination Date, the
rate set forth in H.15(519) for such date opposite the caption "Bank Prime Loan"
or, if such rate is not published by 9:00 A.M., New York City time, on the
Calculation Date pertaining to such Interest Determination Date, the Prime Rate
for such Interest Determination Date shall be calculated by the Calculation
Agent and shall be the arithmetic mean of the rates of interest publicly
announced by each bank named on the Reuters Screen NYMF Page as such bank's
prime rate or base lending rate as in effect for such Interest Determination
Date as quoted on the Reuters Screen NYMF Page on such Interest Determination
Date, or, if fewer than four such rates appear on the Reuters Screen NYMF Page
for such Interest Determination Date, the rate shall be the arithmetic mean of
the prime rates quoted on the basis of the actual number of days in the year
divided by 360 as of the close of business on such Interest Determination Date
by at least two of the three major money center banks in The City of New York
selected by the Calculation Agent from which quotations are requested. If fewer
than two quotations are quoted as aforesaid, the Prime Rate for such Interest
Determination Date shall be calculated by the Calculation Agent and shall be the
arithmetic mean of the prime rates quoted in The City of New York on such date
by the appropriate number of substitute banks or trust companies organized and
doing business under the laws of the United States, or any State thereof, in
each case having total equity capital of at least U.S. $500 million and being
subject to supervision or examination by a Federal or state authority, selected
by the Calculation Agent to quote such rate or rates; provided, however, that if
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the Prime Rate is not published in H.15(519) and the banks or trust companies
selected as aforesaid are not quoting as mentioned in this sentence, the Prime
Rate with respect to such Interest Determination Date will be the Prime Rate
otherwise in effect on such Interest Determination Date. "Reuters Screen NYMF
Page" means the display designated as page "NYMF" on the Reuters Monitor Money
Rates Service (or such other page as may replace page NYMF on that service for
the purpose of displaying prime rates or base lending rates of major United
States banks).
TREASURY RATE NOTES
Each Treasury Rate Note will bear interest at the interest rate (calculated
with reference to the Treasury Rate and the Spread and/or Spread Multiplier, if
any) specified in such Treasury Rate Note and in the applicable Pricing
Supplement.
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Unless otherwise specified in the applicable Pricing Supplement, "Treasury
Rate" means, with respect to any applicable Interest Determination Date, the
rate applicable to the most recent auction of direct obligations of the United
States ("Treasury bills") having the Index Maturity specified in the applicable
Pricing Supplement and such Treasury Rate Note, as such rate is set forth in
H.15(519) under the heading "Treasury Bills - auction average (Investment)" or,
if not so made available by 3:00 P.M., New York City time, on the Calculation
Date pertaining to such Interest Determination Date, the Treasury Rate for such
Interest Determination Date will be the auction average rate (expressed as a
bond equivalent, on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) as otherwise announced by the United States Department
of the Treasury. In the event that the results of the auction of Treasury bills
having the specified Index Maturity are not reported as provided above by 3:00
P.M., New York City time, on such Calculation Date or if no such auction is held
in a particular week, then the Treasury Rate shall be calculated by the
Calculation Agent and shall be the yield to maturity (expressed as a bond
equivalent, on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) of the arithmetic mean of the secondary market bid
rates, as of approximately 3:30 P.M., New York City time, on such Interest
Determination Date, of three leading primary United States government securities
dealers selected by the Calculation Agent for the issue of Treasury bills with a
remaining maturity closest to the applicable Index Maturity; provided, however,
that if the dealers selected as aforesaid by the Calculation Agent are not
quoting as mentioned above, the Treasury Rate with respect to such Interest
Determination Date shall be the Treasury Rate in effect on such date.
ORIGINAL ISSUE DISCOUNT NOTES
The Company may from time to time offer Original Issue Discount Notes. The
applicable Pricing Supplement to certain Original Issue Discount Notes may
provide that the Holders of such Notes will not receive periodic payments of
interest. For the purpose of determining whether Holders of the requisite
principal amount of Notes outstanding under the Indenture have made a demand or
given a notice or waiver or taken any other action, the outstanding principal
amount of Original Issue Discount Notes shall be deemed to be the amount of the
principal that would be due and payable upon declaration of acceleration of the
Specified Maturity thereof as of the date of such determination.
Notwithstanding anything in this Prospectus to the contrary, unless
otherwise specified in the applicable Pricing Supplement, if a Note is an
Original Issue Discount Note, the amount payable on such Note in the event of
Maturity prior to the Specified Maturity shall be the Amortized Face Amount of
such Note as of such Maturity.
INTEREST RATE RESET
If the Company has the option with respect to any Note to reset the
interest rate, in the case of a Fixed Rate Note, or to reset the Spread and/or
Spread Multiplier, in the case of a Floating Rate Note, the Pricing Supplement
relating to such Note will indicate such option, and, if so, (i) the date or
dates on which such interest rate or such Spread and/or Spread Multiplier, as
the case may be, may be reset (each an "Optional Reset Date") and (ii) the basis
or formula, if any, for such resetting.
The Company may exercise such option with respect to a Note by notifying
the Paying Agent of such exercise at least 45 but not more than 60 days prior to
an Optional Reset Date for such Note. Not later than 40 days prior to such
Optional Reset Date, the Paying Agent will mail to the Holder of such Note a
Notice (the "Reset Notice"), first class, postage prepaid, setting forth (i) the
election of the Company to reset the interest rate, in the case of a Fixed Rate
Note, or the Spread and/or Spread
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Multiplier, in the case of a Floating Rate Note, (ii) such new interest rate or
such new Spread and/or Spread Multiplier, as the case may be, and (iii) the
provisions, if any, for redemption during the period from such Optional Reset
Date to the next Optional Reset Date or, if there is no such next Optional Reset
Date, to the Specified Maturity of such Note (each period a "Subsequent Interest
Period"), including the date or dates on which or the period or periods during
which and the price or prices at which such redemption may occur during such
Subsequent Interest Period.
Notwithstanding the foregoing, not later than 20 days prior to an Optional
Reset Date for a Note, the Company may, at its option, revoke the interest rate,
in the case of a Fixed Rate Note, or the Spread and/or Spread Multiplier, in the
case of a Floating Rate Note, in either case provided for in the Reset Notice
and establish a higher interest rate, in the case of a Fixed Rate Note, or a
higher Spread and/or Spread Multiplier, in the case of a Floating Rate Note, for
the Subsequent Interest Period commencing on such Optional Reset Date by mailing
or causing the Paying Agent to mail notice of such higher interest rate or
higher Spread and/or Spread Multiplier, as the case may be, first class, postage
prepaid, to the Holder of such Note. Such notice shall be irrevocable. All Notes
with respect to which the interest rate or Spread and/or Spread Multiplier is
reset on an Optional Reset Date will bear such higher interest rate, in the case
of a Fixed Rate Note, or higher Spread and/or Spread Multiplier, in the case of
a Floating Rate Note.
If the Company elects to reset the interest rate or the Spread and/or
Spread Multiplier of a Note on an Optional Reset Date, the Holder of such Note
will have the option to elect repayment of such Note by the Company on any such
Optional Reset Date at a price equal to the principal amount thereof plus any
accrued interest to such Optional Reset Date. In order for a Note to be so
repaid on an Optional Reset Date on which the interest rate or the Spread and/or
Spread Multiplier is reset, the Holder thereof must follow the procedures set
forth below under "Repayment at Holder's Option" for optional repayment, except
that the period for delivery of such Note or notification to the Paying Agent
shall be at least 25 but not more than 35 days prior to such Optional Reset Date
and except that a Holder who has tendered a Note for repayment pursuant to a
Reset Notice may, by written notice to the Paying Agent, revoke any such tender
for repayment until 5:00 p.m. New York City time on the tenth day, whether or
not a Business Day, prior to such Optional Reset Date.
EXTENDIBLE NOTES
The Company may from time to time offer Notes for which the interest rate
or interest rate formula may be adjusted on specified dates and which may be
subject to repayment at certain times at the option of the Holder or to
redemption at certain times at the option of the Company ("Extendible Notes").
The applicable Pricing Supplement will indicate whether the Company has the
option to extend the maturity of an Extendible Note for one or more periods up
to but not beyond a date set forth in such Pricing Supplement, which in no event
will be more than thirty years from the Original Issue Date of such Note. If
the Company has such option with respect to any such Notes, the procedures
relating thereto will be as set forth in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the Extendible
Notes will be repayable in whole or in part on the day immediately following the
end of the initial interest period, as specified in the applicable Pricing
Supplement, and on the day immediately following the end of each Extension
Period, at the option of the Holder, at 100% of the principal amount to be
repaid, in each case plus accrued interest, if any, to the repayment date. The
applicable Pricing Supplement will specify the procedures that must be followed
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in order to effect such a repayment. An "Extension Period' will be a period of
one or more whole calendar periods (e.g., weeks, months, or years) commencing on
the day following the last day of the initial interest period or any subsequent
Extension Period.
COMBINATION OF PROVISIONS
If so specified in the applicable Pricing Supplement, any Note may be
subject to all of the provisions, or any combination of the provisions,
described above under "Interest Rate Reset" and "Extendible Notes".
OPTIONAL REDEMPTION
The Pricing Supplement relating to each Note will indicate either that such
Note cannot be redeemed prior to its Specified Maturity or that such Note will
be redeemable at the option of the Company on a date or dates specified prior to
its Specified Maturity at a price or prices set forth in the applicable Pricing
Supplement, together with accrued interest to the date fixed for redemption.
The Notes will not be subject to any sinking fund, unless specified in the
applicable Pricing Supplement. The Company may redeem any of the Notes which
are redeemable and remain outstanding either in whole or from time to time in
part, upon not less than 30 nor more than 60 days' notice. If fewer than all of
the Notes with like tenor and terms are to be redeemed, the Notes to be redeemed
shall be selected by the Trustee by such method as the Trustee shall deem fair
and appropriate.
REPAYMENT AT HOLDER'S OPTION
The Pricing Supplement relating to each Note will indicate whether such
Note is repayable at the option of the Holder on a date or dates specified prior
to its Specified Maturity at a price or prices set forth in the applicable
Pricing Supplement, together with accrued interest to the date fixed for
repayment.
In order for a Note to be so repaid, the Paying Agent must receive at least
30 days but not more than 45 days prior to the repayment date (i) the Note with
the form entitled "Option to Elect Repayment" on the reverse of the Note duly
completed or (ii) a telegram, telex, facsimile transmission or a letter from a
member of a national securities exchange or the National Association of
Securities Dealers, Inc. or a commercial bank or trust company in the United
States setting forth the name of the Holder of the Note, the principal amount of
the Note, the principal amount of the Note to be repaid, the certificate number
or a description of the tenor and terms of the Note, a statement that the option
to elect repayment is being exercised thereby and a guarantee that the Note to
be repaid with the form entitled "Option to Elect Repayment" on the reverse of
the Note duly completed will be received by the Paying Agent not later than five
Business Days after the date of such telegram, telex, facsimile transmission or
letter and such Note and form duly completed are received by the Paying Agent by
such fifth Business Day. Exercise of the repayment option by the Holder of a
Note shall be irrevocable. The repayment option may be exercised by the Holder
of a Note for less than the entire principal amount of the Note provided that
the principal amount of the Note remaining outstanding after repayment is an
authorized denomination.
While the Book-Entry Notes are represented by the Global Securities held by
or on behalf of the Depository, and registered in the name of the Depository or
the Depository's nominee, the option for repayment may be exercised by the
applicable Participant (as defined below) that has an account with the
Depository, on behalf of the Beneficial Owners (as defined below) of the Global
Security or Securities representing such Book-Entry Notes, by delivering a
written notice substantially similar to the above
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mentioned form to the Paying Agent at least 30 days but not more than 45 days
prior to the date of repayment. Notices of elections from Participants on
behalf of Beneficial Owners of the Global Security or Securities representing
such Book-Entry Notes to exercise their option to have such Book-Entry Notes
repaid must be received by the Paying Agent by 5:00 P.M., New York City time, on
the last day for giving such notice. In order to ensure that a notice is
received by the Paying Agent on a particular day, the Beneficial Owner of the
Global Security or Securities representing such Book-Entry Notes must so direct
the applicable Participant before such Participant's deadline for accepting
instructions for that day. Different firms may have different deadlines for
accepting instructions from their customers. Accordingly, Beneficial Owners of
the Global Security or Securities representing Book-Entry Notes should consult
the Participants through which they own their interest therein for the
respective deadlines for such Participants. All notices shall be executed by a
duly authorized officer of such Participant (with signatures guaranteed) and
shall be irrevocable. In addition, Beneficial Owners of the Global Security or
Securities representing Book-Entry Notes shall effect delivery at the time such
notices of election are given to the Depository by causing the applicable
Participant to transfer such Beneficial Owner's interest in the Global Security
or Securities representing such Book-Entry Notes, on the Depository's records,
to the Trustee. See "Book-Entry System".
REPURCHASE
The Company may at any time purchase Notes at any price in the open market
or otherwise. Notes so purchased by the Company may be held or resold or, at
the discretion of the Company, may be surrendered to the Trustee for
cancellation. If any Notes and the applicable Pricing Supplement provide for
mandatory sinking fund payments with respect to such Notes, the Indenture
provides that in lieu of making all or any part of any mandatory sinking fund
payment in cash, the Company may deliver to the Trustee any such Notes
previously purchased or otherwise acquired by the Company (to the extent not
previously credited).
OTHER PROVISIONS
Any provisions with respect to the determination of an interest rate basis,
the specifications of interest rate basis, calculation of the interest rate
applicable to, or the principal payable at Maturity on, any Note, its Interest
Payment Dates or any other matter relating thereto may be modified by the terms
as specified under "Other Provisions" on the face of such Note, or in an
addendum relating thereto if so specified on the face thereof, and in the
applicable Pricing Supplement.
EVENTS OF DEFAULT
The Indenture provides that the following are Events of Default thereunder
with respect to the Notes: (i) default in the payment of the principal of (or
premium, if any, on) any Note when and as the same shall be due and payable;
(ii) default in making a sinking fund payment, if any, when and as the same
shall be due and payable by the terms of any Note; (iii) default for 30 days in
the payment of any installment of interest on any Note; (iv) default for 60 days
after written notice (given to the Company by the Trustee or by the Holders of
at least 25% in aggregate principal amount of the Outstanding Securities of all
series affected) in the performance of any other covenant in respect of the
Notes contained in the Indenture; or (v) certain events of bankruptcy,
insolvency or reorganization, or any related court appointment of a receiver,
liquidator or trustee of the Company or any substantial part of its property.
(Section 6.1) An Event of Default with respect to the Notes does not
necessarily constitute an Event of Default with respect to any other series of
Securities issued under the Indenture. The Trustee
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may withhold notice to the Holders of the Notes of any default with respect to
the Notes (except a default in the payment of principal or premium, if any, or
interest) if it considers such withholding in the interest of such Holders.
(Section 6.11)
If any Event of Default with respect to the Notes shall have occurred and
be continuing, the Trustee or the Holders of not less than 25% in aggregate
principal amount of the Outstanding Notes (or, in the case of certain Events of
Default that affect all series of Securities then Outstanding, the Holders of
not less than 25% in aggregate principal amount of all the Securities then
outstanding treated as one class) may declare the principal, or in the case of
discounted Notes, such portion thereof as may be described in the Pricing
Supplement, of all the Notes to be due and payable immediately; however, subject
to certain conditions, any such declaration and its consequences may be
rescinded or annulled by the Holders of not less than a majority in aggregate
principal amount of the Outstanding Notes. (Section 6.1)
Within four months after the close of each year the Company must file with
the Trustee a certificate, signed by specified officers, stating whether or not
such officers have knowledge of any default relating to its covenants,
agreements and obligations with respect to Paying Agents or the maintenance of
its corporate existence, and, if so, specifying each such default and the nature
thereof. (Section 4.6)
Subject to provisions relating to its duties during the continuance of any
Event of Default, the Trustee shall be under no obligation to exercise any of
its rights or powers under the Indenture at the request, order or direction of
any Holders, unless such Holders shall have offered to the Trustee reasonable
indemnity. (Section 7.2) Subject to such provisions for indemnification and
subject to the right of the Trustee to decline to follow any Holders' directions
under specified circumstances, the Holders of a majority in aggregate principal
amount of the Outstanding Notes may direct 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, with respect to the Notes.
(Section 6.9)
TRANSFER
Certificated Notes may be registered for transfer or exchanged at the
Corporate Trust Office of the Trustee or at any other office or agency
maintained by the Company for such purposes, subject to the limitations in the
Indenture, without the payment of any service charge except for any tax or
governmental charge incidental thereto. (Section 3.6)
DEFEASANCE
The Indenture provides that the Company shall be discharged from its
obligations under the Indenture with respect to the Notes at any time prior to
the Stated Maturity or redemption thereof when (a) the Company has irrevocably
deposited with the Trustee, in trust, (i) sufficient funds to pay the principal
of (and premium, if any), and interest to Stated Maturity (or redemption) on,
the Notes, or (ii) such amount of direct obligations of, or obligations the
principal of and interest on which are fully guaranteed by, the United States
Government, and which are not subject to prepayment, redemption or call, as
will, together with the predetermined and certain income to accrue thereon
without consideration of any reinvestment thereof, be sufficient to pay when due
the principal of (and premium, if any), and interest to Stated Maturity (or
redemption) on, the Notes, and (b) the Company has paid all other sums payable
with respect to the Notes. Upon such discharge, the Holders of the Notes shall
no longer be
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entitled to the benefits of the Indenture, except for the purposes of
registration of transfer and exchange of the Notes, and replacement of lost,
stolen or mutilated Notes. (Sections 12.1 and 12.3)
MODIFICATIONS OF INDENTURE
The Indenture, the rights and obligations of the Company thereunder and the
rights of the Holders may be modified with respect to one or more series of
Securities issued under the Indenture with the consent of the Holders of not
less than a majority of the aggregate principal amount of Outstanding Securities
of all series affected by the modification (voting as one class). Without,
however, the consent of the Holder of each Security affected, no modification
shall change the Stated Maturity of any Security, reduce the principal amount or
the amount of premium payable thereon, reduce the rate, extend the time of
payment or change the method of calculation of interest thereon or reduce any
amount payable on redemption thereof or reduce the percentage required for
modification. No modification of the Indenture subordinating the indebtedness
evidenced by any series of Securities issued thereunder to any indebtedness of
the Company is effective against any Holder of Securities without such Holder's
consent. (Section 10.2)
CONCERNING THE TRUSTEE
The Bank of New York is the Trustee under the Indenture. The Bank of New
York has a course of regular dealings with the Company in the ordinary course of
business and from time to time may also make short-term unsecured loans and
secured or unsecured revolving credit and term loans to the Company and
associated companies.
BOOK-ENTRY SYSTEM
The Depository will act as securities depository for the Book-Entry Notes.
The Book-Entry Notes will be issued as fully-registered securities registered in
the name of Cede & Co. (the Depository's partnership nominee). One fully-
registered Global Security will be issued for each issue of the Notes, each in
the aggregate principal amount of such issue, and will be deposited with the
Depository.
The Depository 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, as amended. The Depository holds securities that its
participants ("Participants") deposit with the Depository. The Depository 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
("Direct Participants") include securities brokers and dealers, banks, trust
companies, clearing corporations, and certain other organizations. The
Depository is owned by a number of its Direct Participants and by the New York
Stock Exchange, Inc., the American Stock Exchange, Inc., and the National
Association of Securities Dealers, Inc. Access to the Depository's 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 the Depository and its Participants are on file with the
Securities and Exchange Commission.
Purchases of Book-Entry Notes under the Depository's system must be made by
or through Direct Participants, which will receive a credit for the Book-Entry
Notes on the Depository's records. The ownership interest of each actual
purchaser of each Book-Entry Note ("Beneficial Owner") is in turn to
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be recorded on the Direct and Indirect Participants' records. Beneficial Owners
will not receive written confirmation from the Depository of their purchase, 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 Participant through which the Beneficial Owner
entered into the transaction. Transfers of ownership interests in the Book-
Entry Notes are to be accomplished by entries made on the books of Participants
acting on behalf of the Beneficial Owners. Beneficial Owners will not receive
certificates representing their ownership interests in Book-Entry Notes, except
in the event that use of the book-entry system for one or more Book-Entry Notes
is discontinued.
To facilitate subsequent transfers, all Global Securities deposited by
Participants with the Depository are registered in the name of the Depository's
partnership nominee, Cede & Co. The deposit of Global Securities with the
Depository and their registration in the name of Cede & Co. effect no change in
beneficial ownership. The Depository has no knowledge of the actual Beneficial
Owners of the Book-Entry Notes; the Depository's records reflect only the
identity of the Direct Participants to whose accounts such Book-Entry 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 the Depository 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 Cede & Co. If less than all of the
Book-Entry Notes within an issue are being redeemed, the Depository's current
practice is to determine by lot the amount of the interest of each Direct
Participant in such issue to be redeemed.
Neither the Depository nor Cede & Co. will consent or vote with respect to
Book-Entry Notes. Under its usual procedures, the Depository will mail an
"Omnibus Proxy" to the Company 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 Book-Entry Notes are credited on the record
date (identified in a listing attached to the Omnibus Proxy).
Principal, premium, if any, and interest payments on the Book-Entry Notes
will be made to the Depository. The Depository's practice is to credit Direct
Participants' accounts on the payable date in accordance with their respective
holdings shown on the Depository's records unless the Depository has reason to
believe that it will not receive payment on the payable date. Payments by
Participants to Beneficial Owners will be governed by standing instructions and
customary practices, as in the case of securities held for the accounts of
customers in bearer form or registered in "street name," and will be the
responsibility of such Participant and not of the Depository, or the Company,
subject to any statutory or regulatory requirements as may be in effect from
time to time. Payment of principal and interest to the Depository is the
responsibility of the Company, disbursement of such payments to Direct
Participants shall be the responsibility of the Depository, and disbursement of
such payments to the Beneficial Owners shall be the responsibility of Direct and
Indirect Participants.
A Beneficial Owner shall give notice to elect to have its Book-Entry Notes
purchased or tendered, through its Participant, to the Paying Agent, and shall
effect delivery of such Book-Entry Notes by causing the Direct Participant to
transfer the Participant's interest in the Book-Entry Notes, on the Depository's
records, to the Paying Agent. The requirement for physical delivery of Book-
Entry Notes in connection with a demand for purchase or a mandatory purchase
will be deemed satisfied when the
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ownership rights in the Book-Entry Notes are transferred by a Direct Participant
on the Depository's records.
The Depository may discontinue providing its services as securities
depository with respect to the Book-Entry Notes at any time by giving reasonable
notice to the Company or the Agents. Under such circumstances, in the event
that a successor securities depository is not obtained, Certificated Notes will
be printed and delivered in exchange for the Book-Entry Notes represented by the
Global Securities held by the Depository.
The Company may decide to discontinue use of the system of book-entry
transfers through the Depository (or a successor securities depository). In
that event, Certificated Notes will be printed and delivered in exchange for the
Book-Entry Notes represented by the Global Securities held by the Depository.
The information in this section concerning the Depository and the
Depository's book-entry system has been obtained from sources that the Company
believes to be reliable, but the Company takes no responsibility for the
accuracy thereof.
Neither the Company, the Trustee, any Paying Agent nor the registrar for
the 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 or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
In the opinion of LeBoeuf, Lamb, Greene & MacRae, L.L.P., counsel for the
Company, the following summary correctly describes certain United States Federal
income tax considerations as of the date of this Prospectus relating to
ownership of the Notes that may be relevant to an initial Holder of a Note.
This summary is based on laws, regulations, rulings and decisions now in effect
and which are subject to change. This summary deals only with Holders that will
hold Notes as capital assets, and does not address tax considerations applicable
to investors that may be subject to special tax rules, such as banks, insurance
companies, dealers in securities, tax-exempt organizations, foreign investors,
persons that will hold Notes as a position in a "straddle" for tax purposes or
subsequent holders. This summary does not purport to cover all the possible tax
consequences of the purchase, ownership and disposition of Notes, and it is not
intended as tax advice. Investors should consult their own tax advisers in
determining the tax consequences to them of the purchase, ownership and
disposition of Notes, including the application to their particular situation of
the tax considerations discussed below, as well as the application of other
Federal, state, local or other tax laws.
Holders of Original Issue Discount Notes generally will be subject to the
special tax accounting rules for original issue discount obligations provided by
the Internal Revenue Code of 1986 and certain Treasury Regulations issued
thereunder (the "Regulations"). Holders of such Notes should be aware that, as
described in greater detail below, they generally must include original issue
discount in ordinary gross income for Federal income tax purposes as it accrues,
in advance of the receipt of cash attributable to that income.
In general, each Holder of an Original Issue Discount Note, whether such
Holder uses the cash or the accrual method of tax accounting, will be required
to include in ordinary gross income the sum of the "daily portions" of original
issue discount on that Note for all days during the taxable year that the Holder
owns the Note. The daily portions of original issue discount on an Original
Issue Discount Note are determined by allocating to each day in any accrual
period (generally each successive period that ends
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on an Interest Payment Date, or, in the case of an Original Issue Discount Note
having an interest rate equal to zero, each successive six-month period that
begins on the day in each calendar year corresponding to the Specified Maturity
of the Note or the date six months prior thereto) a ratable portion of the
original issue discount allocable to that accrual period. In the case of an
initial Holder, the amount of original issue discount on an Original Issue
Discount Note allocable to each accrual period is determined by (i) multiplying
the "adjusted issue price" (as defined below) of the Note by a fraction, the
numerator of which is the annual yield to maturity of the Note and the
denominator of which is the number of accrual periods in a year and (ii)
subtracting from that product the amount (if any) payable as interest at the end
of that accrual period. In the case of an Original Issue Discount Note that is
a Floating Rate Note, both the "annual yield to maturity" and the "amount
payable as interest" are determined for these purposes as though the Note bore
interest in all periods at a fixed rate equal to the level of the Base Rate (as
adjusted by the applicable Spread or Spread Multiplier, if any) on the Original
Issue Date. The "adjusted issue price" of an Original Issue Discount Note at
the beginning of any accrual period is the sum of its Issue Price (including
accrued interest, if any) and the amount of original issue discount allocable to
all prior accrual periods, reduced by the amount of all payments other than
interest payments (if any) made with respect to such Note in all prior accrual
periods. As a result of this "constant yield" method of including original
issue discount income, the amounts so includible in income by a Holder in
respect of an Original Issue Discount Note are lesser in the early years and
greater in the later years than the amounts that would be includible on a
straight-line basis.
Certain of the Notes may be issued with a long initial interest payment
period (i.e., the period from the Original Issue Date of the Notes to the first
Interest Payment Date may be longer than the period between subsequent Interest
Payment Dates). In addition, Floating Rate Notes with variable interest rates
that are reset either daily or weekly could be considered as issued with a long
final interest payment period (i.e., the period from but excluding the next
preceding Regular Record Date to which interest has been paid to but excluding
the Maturity date may be longer than the period between prior Regular Record
Dates). Under the Regulations, such a long period may cause all interest
payments on the Notes to be treated as original issue discount for Federal
income tax purposes. In general, under the rules discussed above concerning
Original Issue Discount Notes, if the interest payments were so treated, Holders
of the Notes would be required to include such interest as original issue
discount on the Notes in their income for Federal income tax purposes as it
accrues, rather than as interest on the Notes as such interest is paid. This
would result in an acceleration of income to cash-basis Holders for Federal
income tax purposes.
Payments of interest on Floating Rate Notes that are not based on current
values of an objective interest index will be considered contingent payments and
subject to special rules under the Regulations. Under the Regulations, payments
of interest on the CD Rate Notes, Commercial Paper Rate Notes, Federal Funds
Rate Notes, LIBOR Notes, Prime Rate Notes and Treasury Rate Notes should be
considered payments based on current values of objective interest indices, and
therefore the special rules concerning contingent payments should not apply to
such Notes. If any Floating Rate Note specifies a Base Rate other than the CD
Rate, Commercial Paper Rate, Federal Funds Rate, LIBOR, Prime Rate or Treasury
Rate, to the extent the Federal income tax consequences vary from the
consequences described herein, such tax consequences will be described in the
applicable Pricing Supplement.
Notes with a Specified Maturity of one year or less will be subject to
certain tax rules which apply to the timing of inclusion in income of interest
on such obligations ("Short-Term Notes"). Generally, as discussed in more
detail below, for Federal income tax purposes, an individual or other cash
method Holder of a Short-Term Note is not required to accrue any discount on the
Short-Term Note unless an election is made to do so and interest payments on the
Short-Term Note will not be includible in gross income until the taxable year of
receipt. Such a Holder may, however, be required to defer certain interest
deductions.
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An obligation which is issued for an amount less than its "stated
redemption price at maturity" will generally be considered to be issued at a
discount for Federal income tax purposes. Under the Regulations, all payments
(including all stated interest) with respect to an obligation will be included
in the stated redemption price at maturity if the obligation is a Short-Term
Note and, thus, Holders will be taxed on discount in lieu of stated interest.
This discount will be equal to the excess of the stated redemption price at
maturity over the "issue price" of each Short-Term Note, unless a Holder elects
to compute this discount as acquisition discount using tax basis instead of
issue price. The issue price of each Short-Term Note will be the initial
offering price to the public at which a substantial amount of the Short-Term
Notes are sold. As previously noted, an individual or other cash method Holder
of a Short-Term Note is not required to accrue any discount for Federal income
tax purposes unless an election is made to do so. Holders who report income for
Federal income tax purposes on the accrual method and certain other Holders,
including banks and dealers in securities, are required to accrue discount on
such Short-Term Notes (as ordinary income) on a straight-line method unless an
election is made to accrue the discount according to a constant interest method
based on daily compounding. The amount of discount which accrues in respect of
a Short-Term Note while held by a Holder will be added to such Holder's tax
basis for such Note to the extent included in income. In the case of a cash
method Holder who is not required, and does not elect, to include discount in
income currently, any gain realized on the sale, exchange or retirement of the
Short-Term Note will be ordinary income to the extent of the discount accrued on
a straight-line basis (or, if elected, according to a constant interest method
based on daily compounding) through the date of sale, exchange or retirement.
In addition, such non-electing Holders which are not subject to the current
inclusion requirement described in this paragraph will be required to defer
deductions for any interest paid on indebtedness incurred or continued to
purchase or carry such Short-Term Notes in an amount not exceeding the deferred
interest income, until such deferred interest income is realized.
The applicable Pricing Supplement will contain a discussion of any special
United States Federal income tax rules with respect to any Extendible Notes.
In addition, generally, for Federal income tax purposes, the defeasance of
the Indenture pursuant to Section 12.1 thereof should not result in any Federal
income tax consequences to the Holders of the Notes. However, the Internal
Revenue Service could assert that the deposit and discharge of the Indenture
should be treated as a taxable exchange for the amounts deposited pursuant to
Article 12 thereof. If such assertion were made and upheld, each Holder of the
Notes might be required to recognize gain or loss equal to the difference
between the Holder's cost or other tax basis for the Notes and the value of the
Holder's interest in the trust. Such Holders thereafter might be required to
include in income at different times and in a different amount than would be
includible in the absence of the discharge. Holders should consult their tax
advisors in determining the potential tax consequences to them of a defeasance
under the Indenture pursuant to Section 12.1 thereof.
PLAN OF DISTRIBUTION
Under the terms of the Distribution Agreement, the Notes are offered on a
continuing basis by the Company through the Agents, each of which has agreed to
use its reasonable efforts to solicit purchases of the Notes. The Company will
pay each Agent a commission of from .125% to .750% of the principal amount of
each Note, depending upon its Specified Maturity, sold through such Agent. The
Company will have the sole right to accept offers to purchase Notes and may
reject any such offer in whole or in part. Each Agent will have the right, in
its discretion reasonably exercised, to reject in whole or in part any offer to
purchase Notes received by such Agent. The Company also may sell Notes to any
Agent, acting as principal, at a discount to be agreed upon at the time of sale,
for resale to one or more investors or to one or more broker-dealers (acting as
principal for purposes of resale) at varying prices related to prevailing market
prices at the time of resale, as determined by such Agent, or, if so agreed,
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at a fixed public offering price. Unless otherwise indicated in the applicable
Pricing Supplement, if any Note is resold by an Agent to any broker-dealer at a
discount, such discount will not be in excess of the discount or commission
received by such Agent from the Company. In addition, unless otherwise
indicated in the applicable Pricing Supplement, any Note purchased by an Agent
as principal will be purchased at 100% of the principal amount thereof less a
percentage equal to the commission applicable to an agency sale of a Note having
an identical Specified Maturity. After the initial public offering of the
Notes, the public offering price (in the case of Notes to be resold on a fixed
public offering price basis), the concession and the discount may be changed.
The Company also reserves the right to sell the Notes directly to investors on
its own behalf in those jurisdictions where it is authorized to do so or as
otherwise provided in the applicable Pricing Supplement. In such circumstances,
the Company will have the sole right to accept offers to purchase Notes and may
reject any proposed purchase of Notes in whole or in part. In the case of sales
made directly by the Company, no commission will be payable.
Payment of the purchase price of the Notes will be required to be made in
funds immediately available in The City of New York.
The Agents may be deemed to be "underwriters" within the meaning of the
Securities Act of 1933, as amended (the "Act"). The Company has agreed to
indemnify each Agent against certain liabilities, including liabilities under
the Act, or to contribute to payments each Agent may be required to make in
respect thereof. The Company has agreed to reimburse the Agents for certain of
the Agents' expenses, including, but not limited to, the fees and expenses of
counsel to the Agents.
The Company has been advised by each Agent that such Agent may from time to
time purchase and sell Notes in the secondary market, but that it is not
obligated to do so. There can be no assurance that there will be a secondary
market for the Notes or liquidity in the secondary market if one develops. From
time to time, each Agent may make a market in the Notes. The Notes will not be
listed on any securities exchange.
LEGAL OPINIONS
The validity of the Notes will be passed upon for the Company by LeBoeuf,
Lamb, Greene & MacRae, L.L.P., a limited liability partnership including
professional corporations, New York, New York, and by William M. Finn, Esq.,
Corporate Counsel of the Company, and for the Agents, by Choate, Hall & Stewart,
a partnership including professional corporations, Boston, Massachusetts.
William M. Finn, Esq. and LeBoeuf, Lamb, Greene & MacRae, L.L.P. will be passing
upon statements under the caption "Description of Notes". Certain matters
involving Connecticut law will be passed upon for the Company by Day, Berry &
Howard, Hartford, Connecticut. LeBoeuf, Lamb, Greene & MacRae, L.L.P. and
Choate, Hall & Stewart may rely upon the opinion of William M. Finn, Esq., as to
all legal conclusions affected by the laws of Maine (including the organization
and existence of the Company), and the opinion of Day, Berry & Howard as to all
legal conclusions affected by the laws of Connecticut.
EXPERTS
The consolidated financial statements and schedules of the Company, which
are incorporated herein by reference to the Company's Annual Report on Form 10-K
for the year ended December 31, 1993, have been audited by Arthur Andersen &
Co., independent public accountants, as indicated in their reports with respect
thereto. Such financial statements and schedules are included herein in
reliance upon the authority of said firm as experts in accounting and auditing
in giving said reports.
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR ANY AGENT, UNDERWRITER OR DEALER. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY
SECURITIES OTHER THAN THOSE DESCRIBED HEREIN OR AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY SUCH SECURITIES IN ANY JURISDICTION TO ANY
PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION IN SUCH
JURISDICTION. THIS PROSPECTUS SPEAKS AS OF ITS DATE AND NEITHER THE DELIVERY OF
THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE
ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY OR
ITS SUBSIDIARIES SINCE THE DATE HEREOF OR THAT THE INFORMATION CONTAINED HEREIN
IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF.
__________________
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information.............................................. 1
Incorporation of Certain Documents by Reference.................... 1
The Company........................................................ 2
Ratio of Earnings to Fixed Charges................................. 2
Use of Proceeds.................................................... 2
Description of Notes............................................... 2
Certain Federal Income Tax Consequences............................ 20
Plan of Distribution............................................... 24
Legal Opinions..................................................... 25
Experts............................................................ 25
</TABLE>
================================================================================
================================================================================
$150,000,000
CENTRAL MAINE
POWER COMPANY
MEDIUM-TERM NOTES,
SERIES C
__________________
PROSPECTUS
December 29, 1994
__________________
LEHMAN BROTHERS
PAINEWEBBER INCORPORATED
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
- ------- -------------------------------------------
<TABLE>
<S> <C>
Filing Fee - Securities and Exchange Commission.................. $ 51,724
Auditors' Fees................................................... 41,000*
Rating Agency Fees............................................... 55,500*
Fees and Expenses of Trustee..................................... 3,000*
Legal Fees and Expenses.......................................... 180,000*
State Securities Law Fees and Expenses........................... 15,000*
Printing and Engraving........................................... 10,000*
Miscellaneous.................................................... 1,786*
Total........................................................ $368,000*
- --------------------------
</TABLE>
* Estimated
Item 15. Indemnification of Directors and Officers.
- ------- -----------------------------------------
Subsection 1 of Section 719 of the Business Corporation Law of Maine empowers
a corporation to indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative, by reason
of the fact that he is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, trustee, partner, fiduciary, employee or agent of another
corporation, partnership, joint venture, trust, pension or other employee
benefit plan or other enterprise, against expenses, including attorneys' fees,
judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding; provided
that no indemnification may be provided for any person with respect to any
matter as to which he shall have been finally adjudicated not to have acted
honestly or in the reasonable belief that his action was in or not opposed to
the best interests of the corporation or its shareholders or, in the case of a
person serving as a fiduciary of an employee benefit plan or trust, in or not
opposed to the best interests of that plan or trust, or its participants or
beneficiaries or, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful. The termination of
any action, suit or proceeding by judgment, order or conviction adverse to such
person, or by settlement or plea of nolo contendere or its equivalent, shall
not of itself create a presumption that such person did not act honestly or in
the reasonable belief that his action was in or not opposed to the best
interests of the corporation or its shareholders, or in the case of a person
serving as a fiduciary of an employee benefit plan or trust, in or not opposed
to the best interests of that plan or trust, or its participants or
beneficiaries and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
Section 719 further provides that to the extent that a director, officer,
employee or agent of a corporation has been successful on the merits or
otherwise in defense of any action, suit or proceeding referred to in
Subsection 1 of Section 719, or in defense of any claim, issue or matter
referred to therein, he shall be indemnified against expenses, including
attorney's fees, actually and reasonably incurred by
II-1
<PAGE>
him in connection therewith; that the indemnification provided for by Section
719 shall not be deemed exclusive of any other rights to which the indemnified
party may be entitled under any by-law, agreement, vote of stockholders or
disinterested directors or otherwise; and that a corporation shall have the
power to purchase and maintain insurance on behalf of any person who is or was
a director, officer, employee or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer, trustee, partner,
fiduciary, employee or agent of another corporation, partnership, joint
venture, trust, pension or other employee benefit plan or other enterprise
against any liability asserted against him and incurred by him in such
capacity, or arising out of his status as such, whether or not the corporation
would have the power to indemnify him against such liability under Section 719.
The by-laws of the Company provide, in effect, that the Company will provide
the indemnity described in Section 719 of the Business Corporation Law of
Maine, to the extent and under the circumstances described therein.
The by-laws of the Company also permit the Company to purchase and maintain
insurance to the same extent permitted by Section 719 of the Business
Corporation Law of Maine. The Company has purchased Directors' and Officers'
Liability Insurance insuring the Company and its directors and officers against
Losses (as defined therein) arising from actual or alleged Wrongful Acts (as
defined therein).
Item 16. Exhibits.
------- --------
See Exhibit Index immediately preceding the Exhibits included as part
of this Registration Statement.
Item 17. Undertakings.
------- ------------
The Company hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
Registration Statement;
(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 (1)(i) and (1)(ii) do not apply if the
-------- -------
Registration Statement is on Form S-3 or Form S-8 and the information required
to be included in a post-effective amendment by those paragraphs is contained
in periodic reports filed by the Company pursuant to Section 13 or Section
15(d) of the Securities Exchange Act of 1934 that are incorporated by reference
in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the
II-2
<PAGE>
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.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the Company's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and each
filing of an employee benefit plan's annual report pursuant to Section 15(d) of
the Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Company pursuant to the provisions described under Item 15
above, or otherwise, the Company has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in said Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Company of expenses incurred or paid by a director, officer or
controlling person of the Company in the successful defense of any action, suit
or proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Company 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 said Act
and will be governed by the final adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant 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
Amendment No. 1 to its Registration Statement on Form S-3 to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Augusta,
Maine, on December 27, 1994.
CENTRAL MAINE POWER COMPANY
By /s/ D. E. Marsh
--------------------------------------------
David E. Marsh
Vice President, Corporate Services
and Chief Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date or dates indicated:
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
* President and Chief December 27, 1994
- ----------------------- Executive
David T. Flanagan Officer; Director
(Principal Executive
Officer)
/s/ D. E. Marsh Vice President, Corporate December 27, 1994
- --------------------- Services and Chief
David E. Marsh Financial Officer
(Principal Financial
Officer and Duly
Authorized Officer)
* Comptroller December 27, 1994
- ---------------------
Robert S. Howe
(Principal Accounting Officer)
</TABLE>
II-4
<PAGE>
<TABLE>
<S> <C> <C>
* Chairman of the Board December 27, 1994
- ----------------------- of Directors
Carlton D. Reed, Jr.
* Director December 27, 1994
- -----------------------
Charles H. Abbott
* Director December 27, 1994
- ------------------------
Charleen M. Chase
* Director December 27, 1994
- ------------------------
E. James Dufour
* Director December 27, 1994
- ------------------------
Robert H. Gardiner
* Director December 27, 1994
- ------------------------
David M. Jagger
* Director December 27, 1994
- ------------------------
Charles E. Monty
* Director December 27, 1994
- ------------------------
Robert H. Reny
* Director December 27, 1994
- ------------------------
Kathryn M. Weare
</TABLE>
*By: /s/ David E. Marsh
--------------------
David E. Marsh
Attorney-in-Fact
II-5
<PAGE>
EXHIBIT INDEX
The following exhibits, as indicated below, either are filed herewith
or have been heretofore filed with the Securities and Exchange Commission under
the Securities Act of 1933, the Securities Exchange Act of 1934 or the Public
Utility Holding Company Act of 1935 and are incorporated herein by reference
thereto.
EXHIBIT 1. DISTRIBUTION AGREEMENT
Previously filed:
1.1 Form of Distribution Agreement.
EXHIBIT 4. INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS
Description Exhibit SEC Docket
----------- ------- ----------
4.1 Indenture dated as of August 1, 4.1 33-29626
1989 between the Company and
The Bank of New York, as
Trustee.
4.2 First Supplemental Indenture 4.1 Current Report Form 8-K,
dated as of August 7, 1989. dated August 7, 1989
4.3 Second Supplemental Indenture 4.1 33-44944
dated as of January 10, 1992
Filed herewith:
4.4 Form of Third Supplemental
Indenture (Revised).
EXHIBIT 5. OPINION RE: LEGALITY
Previously filed:
5.1 Opinion of William M. Finn, Esquire.
5.2 Opinion of LeBoeuf, Lamb, Greene & MacRae, L.L.P.
EXHIBIT 12. RATIO OF EARNINGS TO FIXED CHARGES
Previously filed:
12.1 Computation of Ratio of Earnings to Fixed Charges.
<PAGE>
EXHIBIT 23. CONSENTS OF EXPERTS AND COUNSEL
Previously filed:
23.1 The consent of Arthur Andersen & Co. to incorporation by
reference in this Registration Statement of its reports included
in the Company's Form 10-K for the year ended December 31, 1993,
and the reference to its name under the caption "Experts" in the
Prospectus comprising part of this Registration Statement.
23.2 The consent of William M. Finn, Esquire, is contained in his
opinion filed as Exhibit 5.1 to this Registration Statement.
23.3 The consent of LeBoeuf, Lamb, Greene & MacRae, L.L.P. is
contained in their opinion filed as Exhibit 5.2 to this
Registration Statement.
23.4 Consent of Day, Berry & Howard.
EXHIBIT 24. POWER OF ATTORNEY
Previously filed:
24.1 Power of Attorney is made a part hereof and is contained in the
signature page hereto.
EXHIBIT 25. STATEMENT OF ELIGIBILITY OF TRUSTEE
Previously filed:
25.1 Statement of Eligibility of Trustee on Form T-1 of The Bank of New
York.
EXHIBIT 99. OTHER EXHIBITS
Description Exhibit SEC Docket
----------- ------- ----------
99.1 Financial Data Schedule Quarterly Report on
Form 10-Q, dated
September 30, 1994
<PAGE>
EXHIBIT 4.4
================================================================================
CENTRAL MAINE POWER COMPANY
and
THE BANK OF NEW YORK,
As Trustee
_____________________________________
THIRD SUPPLEMENTAL INDENTURE
Dated as of ____________, 1994
Supplementing the Indenture
Dated as of August 1, 1989
____________________________________
================================================================================
<PAGE>
THIS THIRD SUPPLEMENTAL INDENTURE, dated as of ___________, 1994, is
between CENTRAL MAINE POWER COMPANY, a Maine corporation (hereinafter called the
"Issuer" or the "Company"), having its principal office at 83 Edison Drive,
Augusta, Maine 04336, and THE BANK OF NEW YORK, a New York banking corporation,
as Trustee (hereinafter called the "Trustee"), having its Corporate Trust Office
at 101 Barclay Street, New York, New York 10286.
Recitals of the Issuer
----------------------
The Issuer and the Trustee have heretofore entered into an Indenture, dated
as of August 1, 1989, as supplemented by the First Supplemental Indenture, dated
as of August 7, 1989 and the Second Supplemental Indenture, dated as of January
10, 1992 (such Indenture, as heretofore supplemented and as supplemented by this
supplemental indenture being hereinafter referred to as the "Indenture"),
relating to the issuance at any time or from time to time of its Securities on
terms to be specified at the time of issuance. As of September 30, 1994,
$_____________ in aggregate principal amount of Medium-Term Notes, Series A have
been issued under the Indenture, of which $________________ is outstanding and
$150,000,000 in aggregate principal amount of Medium-Term Notes, Series B have
been issued under the Indenture of which $__________ in aggregate principal
amount is outstanding. Terms used and not otherwise defined herein shall
(unless the context otherwise clearly requires) have the respective meanings
given to them in the Indenture.
The Indenture provides in Article Three thereof that, prior to the issuance
of Securities of any series, the form of such Securities and the terms
applicable to such series shall be established in, or pursuant to, the authority
granted in a resolution of the Board of Directors (delivered to the Trustee in
the form of a Board Resolution) or established in one or more indentures
supplemental thereto. The Issuer desires by this supplemental indenture, among
other things, to establish the form of the Securities of a series, to be titled
"Medium-Term Notes, Series C" of the Issuer, and to establish the terms
applicable to such series, pursuant to Sections 3.1 and 10.1(e) of the
Indenture. The Issuer has duly authorized the execution and delivery of this
supplemental indenture.
Article Ten of the Indenture provides that the Issuer, when authorized by a
resolution of its Board of Directors, and the Trustee may from time to time and
at any time enter into an indenture or indentures supplemental thereto for
certain purposes enumerated in Section 10.1 thereof, including the establishment
of the form or terms of Securities of any series as permitted by Section 3.1
thereof.
<PAGE>
The execution and delivery of this supplemental indenture by the parties
hereto are in all respects authorized by the provisions of the Indenture.
All things necessary have been done to make this supplemental indenture a
valid agreement of the Issuer, in accordance with its terms.
NOW, THEREFORE, THIS THIRD SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises, it is mutually covenanted and
agreed, as follows:
ARTICLE ONE
Establishment of Medium-Term Notes, Series C
--------------------------------------------
Section 1.01. The title of the series of the Securities established by
this supplemental indenture shall be "Medium-Term Notes, Series C" of the Issuer
(hereinafter called the "Series C Notes"). The Series C Notes shall be
substantially in the form set forth in Exhibit A hereto (which is hereby
incorporated herein and made a part hereof), subject to changes in the form
thereof made by the Issuer and acceptable to the Trustee.
Section 1.02. The Series C Notes shall be limited to $150,000,000 in
aggregate principal amount at any time Outstanding, determined in accordance
with the definition of "Outstanding" in Section 1.1 (including the final
paragraph thereof) of the Indenture.
Section 1.03. The Series C Notes may be issued in whole or in part as one
or more Global Securities and The Depository Trust Company, or a nominee
thereof, shall be the Depository for such Global Security or Global Securities,
except in each case as otherwise provided in an Issuer Order with respect to any
Series C Notes. The Depository for such Global Security or Global Securities
representing Series C Notes may surrender one or more Global Securities
representing Series C Notes in exchange in whole or in part for individual
Series C Notes on such terms as are acceptable to the Issuer and such Depository
and otherwise subject to the terms of Section 2.4 of the Indenture.
Section 1.04. The Issuer hereby appoints, or confirms the appointment of,
The Bank of New York as the initial Trustee, Securities Registrar and Paying
Agent, subject to the provisions of the Indenture with respect to resignation,
removal and
-2-
<PAGE>
succession, and subject, further, to the right of the Issuer to appoint
additional agents (including Paying Agents). An Authenticating Agent may be
appointed for the Series C Notes under the circumstances set forth in, and
subject to the provisions of, the Indenture.
Section 1.05. If the Trustee shall cease to be Securities Registrar for
the Series C Notes, the Issuer shall, upon the written request of the Trustee,
establish by an Officers' Certificate the applicable dates for the purpose of
clause (a) of Section 5.1 of the Indenture with respect to any Series C Notes
that do not bear interest.
Section 1.06. The terms of the Series C Notes shall be as set forth in
Exhibit A hereto, and shall include the payment and other terms reflected on the
respective Series C Notes as actually executed, authenticated and delivered
under the Indenture. Without limiting the generality of the foregoing, specific
terms of particular Series C Notes (including any interest rate formulas not
specified in Exhibit A hereto, any redemption, sinking fund or other repayment
terms that differ from the provisions of Article Fourteen or Fifteen of the
Indenture and any terms for satisfaction and discharge of the Indenture that
differ from the provisions of Article Twelve of the Indenture) may be determined
in accordance with or pursuant to the Issuer Order with respect thereto, as
referred to in Section 3.3 of the Indenture.
-3-
<PAGE>
ARTICLE TWO
Miscellaneous
-------------
Section 2.01. The recitals contained herein shall be taken as the
statements of the Issuer, and the Trustee assumes no responsibility for the
correctness of the same. The Trustee makes no representation as to the validity
of this supplemental indenture. The Indenture, as supplemented by this
supplemental indenture, is in all respects hereby adopted, ratified and
confirmed.
Section 2.02. This supplemental indenture may be executed in any number of
counterparts, and on separate counterparts, each of which shall be an original;
but such counterparts shall together constitute but one and the same instrument.
Section 2.03. If any provision of this supplemental indenture limits,
qualifies or conflicts with the duties imposed by any of Sections 310 to 317,
inclusive, of the Trust Indenture Act of 1939, as amended by the Trust Indenture
Reform Act of 1990, through operation of Section 318(c), such imposed duties
shall control.
Section 2.04. The Article headings herein are for convenience only and
shall not affect the interpretation hereof.
-4-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Third Supplemental
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested (the date of this supplemental indenture being the
date of execution by the Trustee, as indicated in its Acknowledgment).
CENTRAL MAINE POWER COMPANY
By____________________________
Name:
Title:
[Seal]
Attest:
______________________________
Name:
Title:
THE BANK OF NEW YORK
By____________________________
Name:
Title:
[Seal]
Attest:
______________________________
Name:
Title:
-5-
<PAGE>
STATE OF MAINE )
) ss.:
COUNTY OF KENNEBEC )
At Augusta, on this ____ day of __________, 1994, before me, a Notary
Public in and for the County of Kennebec and State of Maine, personally appeared
__________________________ and _______________________, the ___________________
and Secretary, respectively, of Central Maine Power Company, each to me
personally known, who respectively executed, and affixed and attested the
corporate seal on, the foregoing instrument on behalf of said corporation, and
severally acknowledged the same to be their free act and deed in their said
capacities and the free act and deed of Central Maine Power Company.
NOTARIAL SEAL
________________________
Notary Public
My Commission Expires:
STATE OF NEW YORK )
) ss.:
NEW YORK COUNTY )
At The City of New York, on this ____ day of _________, 1994, before me, a
Notary Public in and for the County and State of New York, personally appeared
_______________________ and ________________________, a
________________________, and a ________________________, respectively, of The
Bank of New York, to me personally known, who respectively executed, and affixed
and attested the corporate seal on, the foregoing instrument on behalf of said
corporation, and severally acknowledged the same to be their free act and deed
in their said capacities and the free act and deed of The Bank of New York, as
Trustee.
NOTARIAL SEAL
________________________
Notary Public
My Commission Expires:
-6-
<PAGE>
Exhibit A
[FORM OF FACE OF NOTE]
Registered
No. C- Registered
CUSIP
If this Note is registered in the name of The Depository Trust Company
(the "Depository") (55 Water Street, New York, New York) or its nominee, this
Note may not be transferred except as a whole by the Depository to a nominee of
the Depository or by a nominee of the Depository to the Depository or another
nominee of the Depository or by the Depository or any such nominee to a
successor Depository or a nominee of such successor Depository unless and until
this Note is presented by an authorized agent of The Depository Trust Company to
the Issuer or its agent for registration of transfer, exchange or payment, and
any certificate issued is registered in the name of Cede & Co. or such other
name as is requested by an authorized representative of The Depository Trust
Company and any payment is made to Cede & Co. ANY TRANSFER, PLEDGE OR OTHER USE
THEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the
registered owner hereof, Cede & Co., has an interest herein.
CENTRAL MAINE POWER COMPANY
MEDIUM-TERM NOTE, SERIES C
If applicable, the "Total Amount of OID", "Yield to Maturity" and
"Initial Accrual Period OID" (computed under the designated method)
below will be completed solely for the purposes of applying the
Federal income tax original issue discount ("OID") rules.
Floating Rate Note [_] ______% Fixed Rate Note [_]
Original Issue Date: Principal Amount:
Interest Accrual Date: Issue Price:
Interest Payment Dates:
Maturity Date:
Redemption Date(s): Redemption Price(s):
Repayment Date(s): Repayment Price(s):
Total Amount of OID:
Yield to Maturity: Optional Interest Rate Reset:
Initial Accrual
Period OID: Extendible:
Other Provisions:
<PAGE>
Only Applicable if this is a Floating Rate Note:
Initial Interest Rate: Spread (plus or minus):
Index Maturity: Spread Multiplier:
Base Rate: Maximum Interest Rate:
Interest Reset Period: Minimum Interest Rate:
Interest Reset Dates:
Interest Determination Dates:
Interest Payment Period:
Calculation Dates:
Central Maine Power Company, a Maine corporation (the "Company", which
term includes any successor issuer under the Indenture hereinafter referred to),
for value received hereby promises to pay to _______ ______________ or
registered assigns, the principal sum of _____ ______________ Dollars on the
"Maturity Date", as set forth above, and to pay interest hereon as described on
the reverse hereof.
The principal of (and premium, if any) and interest on this Note are
payable by the Company in such coin or currency of the United States of America
as at the time of payment shall be legal tender for the payment of public and
private debts.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE 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 manually
executed by or on behalf of the Trustee under the Indenture, this Note shall not
be entitled to any benefit under the Indenture, or be valid or obligatory for
any purpose.
IN WITNESS WHEREOF, CENTRAL MAINE POWER COMPANY has caused this
instrument to be signed in its corporate name by the signatures or facsimile
signatures of its President or a Vice President, and its Treasurer or an
Assistant Treasurer, and its corporate seal or a facsimile thereof to be hereon
impressed,
-2-
<PAGE>
engraved or imprinted and attested by such signature or facsimile signature of
its Secretary or an Assistant Secretary.
Dated: CENTRAL MAINE POWER COMPANY
(Seal)
By:___________________________
Vice President
Attest: ____________________ By:___________________________
Secretary Treasurer
Trustee's Certificate of
Authentication
This is one of the
Securities of the series
designated therein
referred to in the within-
mentioned Indenture.
THE BANK OF NEW YORK,
as Trustee
By: ________________________
Authorized Signatory
-3-
<PAGE>
[FORM OF REVERSE OF NOTE]
CENTRAL MAINE POWER COMPANY
MEDIUM-TERM NOTE, SERIES C
1. This Note is one of a duly authorized issue of unsecured debt
securities (hereinafter called the "Securities") of the Company of the series
hereinafter specified, all such Securities issued and to be issued under an
Indenture dated as of August 1, 1989 between the Company and The Bank of New
York, as Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture), as amended and supplemented by the First
Supplemental Indenture, dated as of August 7, 1989, the Second Supplemental
Indenture, dated as of January 10, 1992 and the Third Supplemental Indenture,
dated as of _________, 1994, and as further amended and supplemented (herein
called the "Indenture"), to which Indenture reference is hereby made for a
statement of the rights and limitations of rights thereunder of the Holders of
the Securities and of the rights, obligations, duties and immunities of the
Trustee and of the Company, and the terms upon which the Securities are and are
to be authenticated and delivered. As provided in the Indenture, the Securities
may be issued in one or more series which different series may be issued in
various aggregate principal amounts, may mature at different times, may bear
interest, if any, at different rates, may be subject to different redemption
provisions, if any, may be subject to different sinking, purchase or analogous
funds, if any, may be subject to different covenants and Events of Default and
may otherwise vary as in the Indenture provided or permitted. This Note is one
of a series designated on the face hereof as Medium-Term Notes, Series C (the
"Notes"), limited to $150,000,000 in aggregate principal amount. The Notes of
this series may be issued at various times with different maturity dates and
different principal repayment provisions, may bear interest at different rates,
and may otherwise vary, all as provided in the Indenture.
2.A. The record date (the "Regular Record Date") with respect to any
Interest Payment Date (as defined below) shall be the date fifteen calendar days
immediately preceding such Interest Payment Date, whether or not such date shall
be a Business Day (unless otherwise shown on the face hereof or as specified
---------------------------------------------------------
below). Interest 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 the Note
is registered at the close of business on the Regular Record Date next preceding
such Interest Payment Date; provided, however, that the first payment of
interest on any Note with an Original Issue Date between a
-4-
<PAGE>
Regular Record Date and the succeeding Interest Payment Date will be made on the
Interest Payment Date following the next succeeding Regular Record Date to the
registered owner on such next succeeding Regular Record Date; and provided,
further, that interest payable at Maturity will be payable to the person to whom
principal shall be payable. "Maturity" means the date on which the principal
amount hereof becomes due and payable, whether at Stated Maturity or earlier by
declaration of acceleration, call for redemption or otherwise. Notwithstanding
the foregoing, any interest that is payable but not punctually paid or duly
provided for on any Interest Payment Date shall forthwith cease to be payable to
the registered owner hereof on such Regular Record Date, and may be paid to the
person in whose name such Note is registered on the close of business on a
subsequent record date established by notice given by mail, by or on behalf of
the Company to such Holder not less than fifteen days preceding such subsequent
record date, such record date to be not less than ten days preceding the date
for payment of such defaulted interest, or may be paid as more fully provided in
the Indenture. "Business Day" means any day, other than a Saturday or Sunday,
that is (a) not a day on which banking institutions are authorized or required
by law or regulation to be closed in The City of New York and (b) with respect
to a LIBOR Note, a London Banking Day. "London Banking Day" means any day on
which dealings in deposits in U.S. Dollars are transacted in the London
interbank market. In connection with any calculations, all percentages will be
rounded upwards, if necessary, to the nearest one hundred-thousandth of a
percentage point, with five one-millionths of a percentage point being rounded
upwards, and all dollar amounts used in or resulting from such calculations on
the Notes will be rounded to the nearest one cent (with one-half cent being
rounded upwards).
B. If this is a Fixed Rate Note, the Company promises to pay interest
on the principal amount from its Original Issue Date at the rate per annum
stated on the face hereof until the principal amount hereof is paid or made
available for payment. Unless otherwise provided on the face hereof, the
Company will pay interest semi-annually each September 1 and March 1 (each an
"Interest Payment Date"), commencing (except as set forth above in the case of a
Note with an Original Issue Date between a Regular Record Date and an Interest
Payment Date) with the Interest Payment Date immediately following the Original
Issue Date and at Maturity. If any Interest Payment Date would otherwise be a
day that is not a Business Day, such Interest Payment Date shall be postponed to
the next day that is a Business Day, and no interest shall accrue by reason of
such delayed payment. Each payment of interest in respect of an Interest
Payment Date shall include interest accrued to but excluding such Interest
Payment Date. Interest on Fixed Rate Notes shall be computed on the basis of a
360-day year of twelve 30-day months.
-5-
<PAGE>
C. If this is a Floating Rate Note, the Company promises to pay
interest on the principal amount from its Original Issue Date at a rate or rates
determined in accordance with the provisions below under the headings
"Determination of CD Rate", "Determination of Commercial Paper Rate",
"Determination of Federal Funds Rate", "Determination of LIBOR", "Determination
of Prime Rate", or "Determination of Treasury Rate", depending upon whether the
Base Rate specified on the face hereof is CD Rate, Commercial Paper Rate,
Federal Funds Rate, LIBOR, Prime Rate or Treasury Rate, respectively, until the
principal hereof is paid or duly made available for payment.
The rate of interest on each Floating Rate Note shall be reset on the
day or days specified on the face hereof (each an "Interest Reset Date") on a
daily, weekly, monthly, quarterly, semi-annual or annual basis (the "Interest
Reset Period") as specified on the face hereof. If any Interest Reset Date for
any Floating Rate Note is not a Business Day, such Interest Reset Date shall be
postponed to the next day that is a Business Day, except, (i) if the Base Rate
is LIBOR and such Business Day is in the next succeeding calendar month, such
Interest Reset Date shall be the immediately preceding Business Day or (ii) if
the Base Rate is Treasury Rate and the Interest Reset Date falls on a date which
is an auction date (as described below), the Interest Reset Date shall be the
following day that is a Business Day.
The Company will pay interest monthly, quarterly, semi-annually or
annually or otherwise, in each case as specified on the face hereof under
"Interest Payment Period" commencing with the first Interest Payment Date
specified on the face hereof next succeeding the Original Issue Date. Unless
otherwise specified on the face hereof, the date or dates on which interest will
be payable (each an "Interest Payment Date") will be, (i) in the case of
Floating Rate Notes with a daily, weekly or monthly Interest Reset Period, on
the third Wednesday of each month or on the third Wednesday of March, June,
September and December of each year, as specified on the face hereof; (ii) in
the case of Floating Rate Notes with a quarterly Interest Reset Period, on the
third Wednesday of March, June, September and December of each year; (iii) in
the case of Floating Rate Notes with a semi-annual Interest Reset Period, on the
third Wednesday of each of the two months specified on the face hereof; and (iv)
in the case of Floating Rate Notes with an annual Interest Reset Period, on the
third Wednesday of one month of each year specified on the face hereof and, in
each case, at Maturity.
If any Interest Payment Date other than at Maturity for any Floating
Rate Note would otherwise be a day that is not a Business Day, such Interest
Payment Date shall be postponed to the next day that is a Business Day, except
that in the case of a LIBOR Note, if such Business Day is in the next succeeding
calendar month, such Interest Payment Date shall be the
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immediately preceding Business Day. If Maturity for any Floating Rate Note
falls on a day that is not a Business Day, payment of principal, premium, if
any, and interest with respect to such Note will be made on the next succeeding
Business Day with the same force and effect as if made on the due date, and no
interest shall be payable on the date of payment for the period from and after
the due date.
Unless otherwise indicated on the face hereof, interest payments on
each Interest Payment Date and at Maturity for Floating Rate Notes will include
accrued interest from and including the Original Issue Date or the next
preceding Interest Payment Date to which interest has been paid or duly provided
for, to but excluding the applicable Interest Payment Date or the date of
Maturity. Accrued interest will be calculated by multiplying the principal
amount of a Floating Rate Note by an accrued interest factor. This accrued
interest factor will be computed by adding the interest factor calculated for
each day in the period for which accrued interest is being calculated. The
interest factor (expressed as a decimal rounded upwards, if necessary, to the
next higher one hundred-thousandth of a percentage point) for each such day will
be computed by dividing the interest rate (calculated as set forth below)
applicable to such day by 360 if the Base Rate is the CD Rate, Commercial Paper
Rate, Federal Funds Rate, LIBOR or Prime Rate, or by the actual number of days
in the year, if the Base Rate is Treasury Rate, as indicated on the face hereof.
The interest rate in effect on each day will be (a) if such day is an Interest
Reset Date, the interest rate with respect to the Interest Determination Date
(as defined below) pertaining to such Interest Reset Date, or (b) if such day is
not an Interest Reset Date, the interest rate with respect to the Interest
Determination Date (as defined below) pertaining to the next preceding Interest
Reset Date, subject in either case to any Maximum or Minimum Interest Rate
limitation referred to on the face hereof and to any adjustment by a Spread
and/or a Spread Multiplier referred to on the face hereof; provided, however,
that the interest rate in effect for the period from the Original Issue Date to
the first Interest Reset Date will be the "Initial Interest Rate" set forth on
the face hereof. The interest rate hereon will in no event be higher than the
maximum rate permitted by applicable law.
The interest rate for each Interest Reset Period for a Floating Rate
Note will be the rate determined by the Calculation Agent on the Calculation
Date (as defined below) pertaining to the Interest Determination Date pertaining
to the Interest Reset Date for such Interest Reset Period. Unless otherwise
specified on the face hereof, the "Interest Determination Date" pertaining to an
Interest Reset Date will be, if the Base Rate is the CD Rate, Commercial Paper
Rate, Federal Funds Rate or Prime Rate, the second Business Day next preceding
such Interest Reset Date. Unless otherwise specified on the face hereof, the
Interest
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Determination Date pertaining to an Interest Reset Date will be, if the Base
Rate is LIBOR, the second London Banking Day next preceding such Interest Reset
Date. Unless otherwise specified on the face hereof, the Interest Determination
Date pertaining to an Interest Reset Date will be, if the Base Rate is Treasury
Rate, the day of the week in which such Interest Reset Date falls on which
direct obligations of the United States ("Treasury bills") of the Index Maturity
specified on the face hereof would normally be auctioned. Treasury bills are
normally sold at auction on Monday of each week, unless that day is a legal
holiday, in which case the auction is usually held on the following Tuesday,
except that such auction may be held on the preceding Friday. If, as the result
of a legal holiday, an auction is so held on the preceding Friday, such Friday
will be the Interest Determination Date pertaining to the Interest Reset Date
for any Note the Base Rate for which is the Treasury Rate occurring in the next
succeeding week. If an auction falls on a day that is an Interest Reset Date for
any Note the Base Rate for which is the Treasury Rate , such Interest Reset Date
will be the first Business Day immediately following such auction date.
Unless otherwise specified on the face hereof, the "Calculation Date",
where applicable, pertaining to an Interest Determination Date will be the
earlier of (i) the tenth calendar day after such Interest Determination Date or
if such day is not a Business Day, the next succeeding Business Day or (ii) the
Business Day preceding the applicable Interest Payment Date or Maturity, as the
case may be.
Subject to applicable provisions of law and except as specified
herein, on each Interest Reset Date the rate of interest shall be the rate
determined in accordance with the provisions of the applicable heading below.
Determination of CD Rate. If the Base Rate indicated on the face
------------------------
hereof is the CD Rate, the interest rate shall equal the rate on each Interest
Determination Date specified on the face hereof for negotiable certificates of
deposit having the Index Maturity specified on the face hereof, as such rate is
published by the Board of Governors of the Federal Reserve System in
"Statistical Release H.15(519), Selected Interest Rates", or any successor
publication of the Board of Governors of the Federal Reserve System
("H.15(519)") under the heading "CDs (Secondary Market)" or, if such rate is not
so published by 3:00 P.M., New York City time, on the Calculation Date
pertaining to such Interest Determination Date, the CD Rate for such Interest
Determination Date will be the rate on such Interest Determination Date for
negotiable certificates of deposit of the specified Index Maturity as published
by the Federal Reserve Bank of New York in its daily statistical release
"Composite 3:30 P.M. Quotations for U.S. Government Securities" or any successor
publication of the Federal Reserve Bank of New York ("Composite Quotations")
under the heading "Certificates of Deposit". If
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such rate is not published in either H.15(519) or Composite Quotations by 3:00
P.M., New York City time, on the Calculation Date pertaining to such Interest
Determination Date, then the CD Rate for such Interest Determination Date will
be calculated by the Calculation Agent and will be the arithmetic mean of the
secondary market offered rates as of 10:00 A.M., New York City time, on such
Interest Determination Date, of three leading nonbank dealers in negotiable U.S.
dollar certificates of deposit in The City of New York selected by the
Calculation Agent for negotiable certificates of deposit of major United States
money center banks of the highest credit standing (in the market for negotiable
certificates of deposit) with a remaining maturity closest to the specified
Index Maturity in a denomination of $5,000,000. In each of the above cases, the
rate shall be adjusted by the addition or subtraction of the Spread, if any,
specified on the face hereof, or by multiplication by the Spread Multiplier, if
any, specified on the face hereof. If the dealers selected as aforesaid by the
Calculation Agent are not quoting as set forth above, the CD Rate with respect
to such Interest Determination Date will be the CD Rate in effect on such
Interest Determination Date.
Determination of Commercial Paper Rate. If the Base Rate indicated on
--------------------------------------
the face hereof is the Commercial Paper Rate, the interest rate shall equal the
Money Market Yield (calculated as described below) of the rate on each Interest
Determination Date specified on the face hereof for commercial paper having the
Index Maturity specified on the face hereof, as such rate is published in
H.15(519), under the heading "Commercial Paper" or, if such rate is not
published by 3:00 P.M., New York City time, on the Calculation Date pertaining
to such Interest Determination Date, the Commercial Paper Rate for such Interest
Determination Date will be the Money Market Yield of the rate on such Interest
Determination Date for commercial paper having the specified Index Maturity as
published in Composite Quotations under the heading "Commercial Paper". If such
rate is not published in either H.15(519) or Composite Quotations by 3:00 P.M.,
New York City time, on the Calculation Date pertaining to such Interest
Determination Date, then the Commercial Paper Rate for such Interest
Determination Date shall be calculated by the Calculation Agent and shall be the
Money Market Yield of the arithmetic mean of the offered rates as of 11:00 A.M.,
New York City time, on such Interest Determination Date of three leading dealers
of commercial paper in The City of New York selected by the Calculation Agent
for commercial paper having the specified Index Maturity, placed for an
industrial issuer whose bond rating is "AA", or the equivalent, from a
nationally recognized rating agency. In each of the above cases, the rate shall
be adjusted by the addition or subtraction of the Spread, if any, specified on
the face hereof, or by multiplication by the Spread Multiplier, if any,
specified on the face hereof. If the dealers selected as aforesaid by the
Calculation Agent are not quoting
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offered rates as specified herein, the Commercial Paper Rate with respect to
such Interest Determination Date will be the Commercial Paper Rate in effect on
such Interest Determination Date.
"Money Market Yield" means a yield (expressed as a percentage rounded
to the nearest one hundred-thousandth of a percentage point) calculated in
accordance with the following formula:
D X 360
Money Market Yield = ------------------ X 100
360 - (D X M)
where "D" refers to the applicable per annum rate for commercial paper quoted on
a bank discount basis and expressed as a decimal, and "M" refers to the actual
number of days in the interest period for which interest is being calculated.
Determination of Federal Funds Rate. If the Base Rate indicated on
-----------------------------------
the face hereof is the Federal Funds Rate, the interest rate shall equal the
rate on each Interest Determination Date specified on the face hereof for
Federal Funds as published in H.15(519) under the heading "Federal Funds
(Effective)" or, if such rate is not so published by 3:00 P.M., New York City
time, on the Calculation Date pertaining to such Interest Determination Date,
the Federal Funds Rate for such Interest Determination Date will then be the
rate on such Interest Determination Date as published in Composite Quotations
under the heading "Federal Funds/ Effective Rate". If such rate is not
published in either H.15(519) or Composite Quotations by 3:00 P.M., New York
City time, on the Calculation Date pertaining to such Interest Determination
Date, then the Federal Funds Rate for such Interest Determination Date will be
calculated by the Calculation Agent and will be the arithmetic mean of the
rates, as of 9:00 A.M., New York City time, on such Interest Determination Date,
for the last transaction in overnight Federal Funds arranged by three leading
brokers of Federal Funds transactions in The City of New York selected by the
Calculation Agent. In each of the above cases the rate shall be adjusted by the
addition or subtraction of the Spread, if any, specified on the face hereof, or
by multiplication by the Spread Multiplier, if any, specified on the face
hereof. If the brokers selected as aforesaid by the Calculation Agent are not
quoting as set forth above, the Federal Funds Rate with respect to such Interest
Determination Date will be the Federal Funds in effect on such Interest
Determination Date.
Determination of LIBOR. If the Base Rate indicated on the face hereof
----------------------
is LIBOR, the interest rate with respect to each Interest Determination Date
specified on the face hereof shall be determined in accordance with the
following provisions:
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(i) With respect to any such Interest Determination Date, LIBOR will
be either: (a) if "LIBOR Reuters" is specified on the face hereof, the
arithmetic mean of the offered rates (unless the specified designated
LIBOR Page (as defined below) by its terms provides only for a single
rate, in which case such single rate shall be used) for deposits in
United States dollars having the Index Maturity designated on the face
hereof, commencing on the second London Banking Day immediately
following the Interest Determination Date, which appear on the
Designated LIBOR Page specified on the face hereof as of 11:00 A.M.,
London time, on such Interest Determination Date, if at least two such
offered rates appear (unless, as aforesaid, only a single rate is
required) on such Designated LIBOR Page, or (b) if "LIBOR Telerate" is
specified on the face hereof, the rate for deposits in United States
dollars having the Index Maturity specified on the face hereof,
commencing on the second London Banking Day immediately following such
Interest Determination Date, which appears on the Designated LIBOR
Page specified on the face hereof as of 11:00 A.M. London time on that
Interest Determination Date. Notwithstanding the foregoing, if fewer
than two offered rates appear on the Designated LIBOR Page with
respect to LIBOR Reuters (unless the specified Designated LIBOR Page
with respect to LIBOR Reuters by its terms provides only for a single
rate, in which case such single rate shall be used), or if no rate
appears on the Designated LIBOR Page with respect to LIBOR Telerate,
whichever may be applicable, LIBOR in respect of the related Interest
Determination Date will be determined as if the rate described in
clause (ii) below had been specified.
(ii) With respect to any such Interest Determination Date on which
fewer than two offered rates appear on the Designated LIBOR Page with
respect to LIBOR Reuters (unless the Designated LIBOR Page by its
terms provides only for a single rate, in which case such single rate
shall be used), or if no rate appears on the Designated LIBOR page
with respect to LIBOR Telerate, as the case may be, the Calculation
Agent will request the principal London office of each of four major
banks in the London interbank market selected by the Calculation Agent
to provide the Calculation Agent with its offered rate quotation for
deposits in United States dollars for the period of the Index Maturity
specified on the face hereof, commencing on the second London Banking
Day immediately following such Interest Determination Date, to prime
banks in the London interbank market as of 11:00 A.M., London time, on
such Interest Determination Date and in a principal amount that is
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representative for a single transaction in United States dollars in
such market at such time. If at least two such quotations are
provided, LIBOR determined on such Interest Determination Date will be
the arithmetic mean of such quotations. If fewer than two quotations
are provided, LIBOR determined on such Interest Determination Date
will be the arithmetic mean of the rates quoted as of 11:00 A.M. in
The City of New York, on such Interest Determination Date by three
major banks in The City of New York selected by the Calculation Agent
for loans in United States dollars to leading banks, having the Index
Maturity specified on the face hereof in a principal amount that is
representative for a single transaction in United States dollars in
such market at such time.
In each of the above cases the rate shall be adjusted by the addition or
subtraction of the Spread, if any, specified on the face hereof, or by
multiplication by the Spread Multiplier, if any, specified on the face hereof.
If the banks selected as aforesaid by the Calculation Agent are not quoting as
set forth above, LIBOR determined on such Interest Determination Date will be
LIBOR in effect on such Interest Determination Date.
"Designated LIBOR Page" means either (a) the display on the Reuters
Monitor Money Rates Service for the purpose of displaying the London interbank
rates of major banks for United States dollars (if "LIBOR Reuters" is designated
on the face hereof), or (b) the display on the Dow Jones Telerate Service for
the purpose of displaying the London interbank rates of major banks for United
States dollars (if "LIBOR Telerate" is designated on the face hereof). If
neither LIBOR Reuters nor LIBOR Telerate is specified on the face hereof, LIBOR
will be determined as if LIBOR Telerate (page 3750) had been chosen.
Determination of Prime Rate. If the Base Rate indicated on the face
---------------------------
hereof is the Prime Rate, the interest rate shall equal the rate on each
Interest Determination Date specified on the face hereof as published in
H.15(519) opposite the caption "Bank Prime Loan". If such rate is not so
published by 9:00 A.M., New York City time, on the Calculation Date pertaining
to such Interest Determination Date, the Prime Rate for such Interest
Determination Date shall be calculated by the Calculation Agent and shall be the
arithmetic mean of the rates of interest publicly announced by each bank named
on the Reuters Screen NYMF Page as such bank's prime rate or base lending rate
as in effect for such Interest Determination Date as quoted on the Reuters
Screen NYMF Page on such Interest Determination Date, or, if fewer than four
such rates appear on the Reuters Screen NYMF Page for such Interest
Determination Date, the rate shall be the arithmetic mean of the prime rates
quoted on the basis of the actual number of days in the year divided by 360 as
of the close
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of business on such Interest Determination Date by at least two of the three
major money center banks in The City of New York selected by the Calculation
Agent from which quotations are requested. If fewer than two quotations are
quoted as aforesaid, the Prime Rate for such Interest Determination Date shall
be calculated by the Calculation Agent and shall be the arithmetic mean of the
prime rates quoted in The City of New York on such date by the appropriate
number of substitute banks or trust companies organized and doing business under
the laws of the United States, or any State thereof, in each case having total
equity capital of at least U.S. $500 million and being subject to supervision or
examination by a Federal or state authority, selected by the Calculation Agent
to quote such rate or rates. In each of the above cases, the rate shall be
adjusted by the addition or subtraction of the Spread, if any, specified on the
face hereof, or by multiplication by the Spread Multiplier, if any, specified on
the face hereof.
If the Prime Rate is not published in H.15(519) and the banks or trust
companies selected as aforesaid are not quoting as mentioned in the preceding
paragraph, the Prime Rate with respect to such Interest Determination Date will
be the Prime Rate otherwise in effect on such Interest Determination Date.
"Reuters Screen NYMF Page" means the display designated as page "NYMF" on the
Reuters Monitor Money Rates Service (or such other page as may replace page NYMF
on that service for the purpose of displaying prime rates or base lending rates
of major United States banks).
Determination of Treasury Rate. If the Base Rate indicated on the
------------------------------
face hereof is the Treasury Rate, the interest rate shall equal the rate on each
Interest Determination Date specified on the face hereof applicable to the most
recent auction of direct obligations of the United States ("Treasury bills")
having the Index Maturity specified on the face hereof, as such rate is set
forth in H.15(519) under the heading "Treasury Bills - auction average
(Investment)" or, if not so made available by 3:00 P.M., New York City time, on
the Calculation Date pertaining to such Interest Determination Date, the
Treasury Rate for such Interest Determination Date will be the auction average
rate (expressed as a bond equivalent on the basis of a year of 365 or 366 days,
as applicable, and applied on a daily basis) as otherwise announced by the
United States Department of the Treasury. In the event that the results of the
auction of Treasury bills having the specified Index Maturity are not reported
as provided above by 3:00 P.M., New York City time, on such Calculation Date or
if no such auction is held in a particular week, then the Treasury Rate shall be
calculated by the Calculation Agent and shall be the yield to maturity
(expressed as a bond equivalent on the basis of a year of 365 or 366 days, as
applicable, and applied on a daily basis) of the arithmetic mean of the
secondary market bid rates, as of
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approximately 3:30 P.M., New York City time, on such Interest Determination
Date, of three leading primary United States government securities dealers
selected by the Calculation Agent for the issue of Treasury bills with a
remaining maturity closest to the specified Index Maturity. In each of the
above cases the rate shall be adjusted by the addition or subtraction of the
Spread, if any, specified on the face hereof, or by multiplication by the Spread
Multiplier, if any, specified on the face hereof. If the dealers selected as
aforesaid by the Calculation Agent are not quoting as mentioned in this
paragraph, the Treasury Rate for such Interest Determination Date will be the
Treasury Rate with respect to such Interest Determination Date shall be the
Treasury Rate in effect on such date.
Initially, The Bank of New York shall be the Calculation Agent. The
Calculation Agent shall calculate the interest rate hereon in accordance with
the foregoing and will confirm in writing such calculation to the Trustee and
any Paying Agent immediately after each determination. Neither the Trustee nor
any Paying Agent shall be responsible for any such calculation. At the request
of the Holder hereof the Calculation Agent will provide to the Holder hereof the
interest rate hereon then in effect and, if determined, the interest rate which
will become effective as of the next Interest Reset Date.
Interest Rate Reset. If specified on the face hereof, the Company has
-------------------
the option to reset the interest rate, in the case of a Fixed Rate Note, or to
reset the Spread and/or Spread Multiplier, in the case of a Floating Rate Note,
on the date or dates specified on the face hereof (each an "Optional Reset
Date") and on the basis or formula, if any, for such resetting specified on the
face hereof.
The Company may exercise such option by notifying the Paying Agent of
such exercise at least 45 but not more than 60 days prior to an Optional Reset
Date for such Note. Not later than 40 days prior to such Optional Reset Date,
the Paying Agent will mail to the Holder hereof a Notice (the "Reset Notice"),
first class, postage prepaid, setting forth (i) the election of the Company to
reset the interest rate, in the case of a Fixed Rate Note, or the Spread and/or
Spread Multiplier, in the case of a Floating Rate Note, (ii) such new interest
rate or such new Spread and/or Spread Multiplier, as the case may be, and (iii)
the provisions, if any, for redemption during the period from such Optional
Reset Date to the next Optional Reset Date or, if there is no such next Optional
Reset Date, to the Stated Maturity of the principal amount of such Note (each
period a "Subsequent Interest Period"), including the date or dates on which or
the period or periods during which and the price or prices at which such
redemption may occur during such Subsequent Interest Period.
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Notwithstanding the foregoing, not later than 20 days prior to an
Optional Reset Date for a Note, the Company may, at its option, revoke the
interest rate, in the case of a Fixed Rate Note, or the Spread and/or Spread
Multiplier, in the case of a Floating Rate Note, in either case provided for in
the Reset Notice and establish a higher interest rate, in the case of a Fixed
Rate Note, or a higher Spread and/or Spread Multiplier, in the case of a
Floating Rate Note, for the Subsequent Interest Period commencing on such
Optional Reset Date by mailing or causing the Paying Agent to mail notice of
such higher interest rate or higher Spread and/or Spread Multiplier, as the case
may be, first class, postage prepaid, to the Holder hereof. Such notice shall be
irrevocable. All Notes with respect to which the interest rate or Spread and/or
Spread Multiplier is reset on an Optional Reset Date will bear such higher
interest rate, in the case of a Fixed Rate Note, or higher Spread and/or Spread
Multiplier, in the case of a Floating Rate Note.
If the Company elects to reset the interest rate or the Spread and/or
Spread Multiplier on an Optional Reset Date, the Holder will have the option to
elect repayment by the Company on such Optional Reset Date at a price equal to
the principal amount thereof plus any accrued interest to such Optional Reset
Date. In order for a Note to be so repaid on an Optional Reset Date on which
the interest rate or the Spread and/or Spread Multiplier is reset, the Holder
must follow the procedures set forth in paragraph 5 below for optional
repayment, except that the period for delivery of such Note or notification to
the Paying Agent shall be at least 25 but not more than 35 days prior to such
Optional Reset Date and except that a Holder who has tendered a Note for
repayment pursuant to a Reset Notice may, by written notice to the Paying Agent,
revoke any such tender for repayment until 5:00 p.m. New York City time on the
tenth day, whether or not a Business Day, prior to such Optional Reset Date.
Extendible Notes. If specified on the face hereof, the interest rate
----------------
on, or interest rate formula pertaining to, this Note may be subject to
adjustment and this Note may be subject to repayment at certain times at the
option of the Holder or to redemption at certain times at the option of the
Company ("Extendible Notes"). If any such options are applicable to this Note,
the terms and procedures relating thereto will be as set forth in Exhibit A
hereto.
Unless otherwise specified in Exhibit A hereto, the Extendible Notes
will be repayable in whole or in part on the day immediately following the end
of the initial interest period, as specified in Exhibit A, and on the day
immediately following the end of each Extension Period, at the option of the
Holder, at 100% of the principal amount to be repaid, in each case plus accrued
interest, if any, to the repayment date. An "Extension
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Period" will be a period of one or more whole calendar periods (e.g., weeks,
months, or years) commencing on the day following the last day of the initial
interest period or any subsequent Extension Period.
Combination of Provisions. If so specified on the face hereof, this
-------------------------
Note may be subject to all of the provisions, or any combination of the
provisions, described above under "Interest Rate Reset" and "Extendible Notes".
3. Payments of interest (other than interest payable at Maturity)
will be made by mailing a check to the Holder at the address of the Holder
appearing on the Securities Register on the applicable Regular Record Date,
unless otherwise agreed to by the Company. The principal amount hereof and any
premium and the interest payable at Maturity will be paid at Maturity against
presentation of this Note at the office or agency of the Company maintained for
that purpose in the Borough of Manhattan, The City of New York, or as otherwise
provided in the Indenture.
4. If specified on the face hereof, this Note may be redeemed, as a
whole or from time to time in part, at the option of the Company, on not less
than 30 nor more than 60 days' prior notice given as provided in the Indenture,
on any Redemption Date(s) and at the related Redemption Price(s) (expressed as a
percentage of the principal amount hereof) set forth on the face hereof,
together with interest accrued and unpaid hereon to such Redemption Date. If no
such Redemption Date is set forth on the face hereof, this Note may not be so
redeemed prior to the Maturity Date specified on the face hereof. If fewer than
all the Outstanding Notes of like tenor and terms are to be redeemed, the
particular Notes to be redeemed shall be selected by the Trustee not more than
60 days prior to the Redemption Date from the Outstanding Notes of like tenor or
terms not previously called for redemption. Such selection shall be of
principal amounts in increments of $1,000 (provided that any remaining principal
of any Note shall be at least $25,000). Subject to the immediately preceding
sentence, such selection shall be made by any method as the Trustee deems fair
and appropriate. The notice of such redemption shall specify which Notes are to
be redeemed. In the event of redemption of this Note in part only, a new Note
or Notes of this series of like tenor or terms for the unredeemed portion hereof
will be issued to the Holder hereof upon the cancellation hereof.
5. If specified on the face hereof, this Note will be subject to
repayment at the option of the Holder hereof on the Repayment Date(s) and at the
related Repayment Price(s) (expressed as a percentage of the principal amount
hereof) indicated on the face hereof. If no such Repayment Date is set forth on
the face hereof, this Note may not be so repaid prior to the Maturity Date
specified on the face hereof. On each
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Repayment Date, if any, this Note shall be repayable in whole or in part at the
option of the Holder hereof at the applicable Repayment Price set forth on the
face hereof, together with interest accrued and unpaid hereon to such Repayment
Date. In order for this Note to be repaid in whole or in part at the option of
the Holder hereof, the Paying Agent must receive not less than 30 but not more
than 45 days prior to the Repayment Date (i) the Note with the form entitled
"Option to Elect Repayment" below duly completed or (ii) a telegram, telex,
facsimile transmission or a letter from a member of a national securities
exchange or the National Association of Securities Dealers, Inc. or a commercial
bank or a trust company in the United States of America setting forth the name
of the Holder of the Note, the principal amount of the Note, the certificate
number of the Note or a description of the Note's tenor or terms, the principal
amount of the Note to be repaid, a statement that the option to elect repayment
is being exercised thereby and a guarantee that the Note to be repaid with the
form entitled "Option to Elect Repayment" on the reverse of the Note duly
completed will be received by such Paying Agent no later than five Business Days
after the date of such telegram, telex, facsimile transmission or letter and
such Note and form duly completed are received by such Paying Agent by such
fifth Business Day. Exercise of such repayment option shall be irrevocable.
Such option may be exercised by the Holder for less than the entire principal
amount provided that the principal amount remaining outstanding after repayment
is an authorized denomination.
6. If an Event of Default with respect to the Notes shall occur and
be continuing, the principal of all of the Notes may be declared due and payable
in the manner and with the effect provided in the Indenture. If this is an
Original Issue Discount Note and the principal amount hereof is declared to be
due and payable, the amount of principal due and payable with respect to this
Note shall be limited to the Amortized Face Amount of this Note as of the date
of such declaration. If this Note is an Original Discount Note that does not
bear stated interest, the "Amortized Face Value" hereof shall be the sum of (i)
the aggregate principal amount of this Note multiplied by the Issue Price
(expressed as a percentage of the aggregate principal amount) indicated on the
face hereof plus (ii) the portion of the difference between the dollar amount
determined pursuant to the preceding clause (i) and the principal amount of this
Note that has accrued at the Yield to Maturity set forth on the face hereof
(computed in accordance with generally accepted financial practices in effect on
the date of declaration) to such date of declaration, but in no event shall the
Amortized Face Amount of this Note exceed the principal amount hereof. An
Original Issue Discount Note is a Note, including any Zero-Coupon Note, that has
a stated redemption price at its Maturity Date that exceeds its Issue Price by
at least 0.25% of its principal amount, multiplied
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<PAGE>
by the number of full years from the Original Issue Date to the Maturity Date
for such Note and any other Note designated by the Company as issued with
original issue discount for United States federal income tax purposes.
7. The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities under
the Indenture at any time by the Company with the consent of the Holders of not
less than a majority in principal amount of the Securities at the time
Outstanding of all series to be affected thereby (voting as one class). The
Indenture also contains provisions permitting the Holders of a majority in
principal amount of the Securities of any series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and past defaults under the
Indenture and their consequences with respect to such series. In the case of
any such waiver, the Holder of this Note shall be restored to his former
position and rights hereunder, such default shall cease to exist and be deemed
to have been cured and not to have occurred, and any related Event of Default
shall be deemed to have been cured, and not to have occurred for every purpose
of the Indenture; but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.
8. No reference herein to the Indenture and no provision of this Note
or of the Indenture shall affect or impair the obligation of the Company, which
is unconditional and absolute, to pay the principal of and premium, if any, and
interest on this Note at the places, at the times, at the rates, in the amounts
and in the coin or currency as prescribed herein and in the Indenture.
9. Notes will be issued in denominations of $25,000 and integral
multiples of $1,000 in excess thereof.
10. As provided in the Indenture and subject to certain limitations
therein set forth, this Note is transferable on the Securities Register of the
Company, upon surrender of this Note for registration of transfer at the office
or agency of the Company to be maintained for that purpose in The City of New
York. Every Note presented for registration of transfer shall (if so required
by the Company or the Securities Registrar) be duly endorsed, or accompanied by
a written instrument of transfer in form satisfactory to the Company and the
Securities Registrar duly executed, by the Holder hereof or its attorney duly
authorized in writing, and thereupon one or more new Notes of like tenor and
terms of authorized denominations and for the same aggregate principal amount
will be issued to the designated transferee or transferees.
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<PAGE>
The Company shall not be required (i) to issue, register the transfer
of or exchange Notes to be redeemed for a period of fifteen days preceding the
date of the mailing of the notice of redemption, or (ii) to register the
transfer of or to exchange any such Note or portion thereof selected for
redemption, except the unredeemed portion of any such Note being redeemed in
part.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith. Prior to
due presentment of a Note for registration of transfer, the Company, the Trustee
and any agent of the Company or the Trustee may treat the person in whose name a
Note is registered as the owner hereof for all purposes whether or not such Note
be overdue and neither the Company, the Trustee nor any such agent shall be
affected by notice to the contrary.
11. Unless otherwise defined herein, all terms used in this Note
which are defined in the Indenture shall have the meaning assigned to them in
the Indenture.
12. The Indenture and this Note shall for all purposes be governed
by, and construed in accordance with, the laws of the State of Maine, and for
all purposes this Indenture shall be construed in accordance with the laws of
said State, except that the rights and duties of the Trustee shall be governed
by the laws of the State of New York.
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<PAGE>
ASSIGNMENT
----------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
_____________________________ _________________________________________
Please insert social security Please print or typewrite name and
or other identifying number address of assignee
of assignee
_____________________________________________________________________________
_____________________________________________________________________________
the within Note of Central Maine Power Company and does hereby irrevocably
constitute and appoint ______________________________ attorney to transfer the
said Note on the books of the within-mentioned Company, with full power of
substitution in the premises.
Dated: _________________ _________________________________________
Notice: The signature on this assignment
must correspond with the name as written
upon the face of the Note in every
particular without alteration or
enlargement or any change whatsoever.
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<PAGE>
OPTION TO ELECT REPAYMENT*
-------------------------
The undersigned hereby irrevocably requests and instructs the Company
to repay the within Note (or portion hereof specified below) pursuant to its
terms at a price equal to the applicable Repayment Price thereof together with
interest to the Repayment Date, to the undersigned at _________________________
_______________________________________________________________________________
Please print or typewrite name and address of the undersigned
If less than the entire principal amount of the within Note is to be
repaid, specify the portion thereof that the Holder elects to have repaid
_____________________________________ and specify the denomination or
denominations (which shall be in authorized denominations) of the Notes to be
issued to the Holder for the portion of the within Note not being repaid (in the
absence of any such specification, one such Note will be issued for the portion
not being repaid): ____________________________.
Date: ______________________ _____________________________
Signature
* Note: This option is not available to a holder unless this Note contains an
---- ---
express provision granting to the holder hereof an option to elect
repayment.
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