<PAGE>
As filed with the Securities and Exchange Commission on May 5, 1995
Registration No. 33-58297
=================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
___________________
AMENDMENT NO. 3
TO
FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
SOUTHERN UNION COMPANY Delaware 75-0571592
SOUTHERN UNION FINANCING I Delaware To Be Applied For
SOUTHERN UNION FINANCING II Delaware To Be Applied For
SOUTHERN UNION FINANCING III Delaware To Be Applied For
(Exact name of Registrant as (State or other (I.R.S. Employer
specified in its Charter) Jurisdiction of Identification
Incorporation Number)
or Organization)
504 Lavaca Street, Suite 800
Austin, Texas 78701
(512) 477-5852
(Address, including zip code, and telephone number,
including area code, of each registrant's principal
executive offices)
__________________
Dennis K. Morgan, Esq. With a copy to:
Vice President-Legal and Secretary Stephen A. Bouchard,Esq.
SOUTHERN UNION COMPANY Fleischman and Walsh, L.L.P.
504 Lavaca Street, Suite 800 1400 Sixteenth Street, N.W.,
Suite 600
Austin, Texas 78701 Washington, D.C. 20036
(512) 477-5852 (202) 939-7911
(Name, address, including zip code,
and telephone number, including
area code, of agent for service
for each registrant)
________________________
Approximate Date of Commencement of Proposed Sale to Public:
From time to time after the effective date of the Registration
Statement, as determined by market conditions.
________________________
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans,
please check the following blank: _____
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415
under the Securities Act of 1933, as amended, other than securi-
ties offered only in connection with dividend or interest
reinvestment plans, please check the following blank: X
_____
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Maximum Maximum
Offering Aggregate Amount of
Title of Each Class Amount to Price Per Offering Registra-
of Securities to be be Regis- Unit Price tion Fee
Registered tered (1) (1)(2)(3) (1)(2)(3) (2)
___________________ _________ _________ _________ _________
Preferred Securities
of Southern Union
Financing I. . . .
Preferred Securities
of Southern Union
Financing II . . .
Preferred Securities
of Southern Union
Financing III. . .
Senior Debt Securi-
ties of Southern
Union Company. . .
Guarantees of Pre-
ferred Securities
of Southern Union
Financing I,
Southern Union
Financing II,
Southern Union
Financing III by
Southern Union
Company (4). . . .
_________________________________________________________________
Total $300,000,000 100% $300,000,000 $103,449.00
(1) Such indeterminate number of Preferred Securities of
Southern Union Financing I, Southern Union Financing II and
Southern Union Financing III and such indeterminate princi-
pal amount of Senior or Subordinated Debt Securities of
Southern Union Company as may from time to time be issued at
indeterminate prices. Subordinated Debt Securities may be
issued and sold to Southern Union Financing I, Southern
Union Financing II and Southern Union Financing III, in
which event such Subordinated Debt Securities may later be
distributed to the holders of Preferred Securities upon a
dissolution of Southern Union Financing I, Southern Union
Financing II and Southern Union Financing III and the dis-
tribution of the assets thereof.
(2) Estimated solely for the purpose of calculating the regis-
tration fee pursuant to Rule 457. The aggregate public
offering price of the Preferred Securities of Southern Union
Financing I, Southern Union Financing II and Southern Union
Financing III and the Senior or Subordinated Debt Securities
of Southern Union Company registered hereby will not exceed
$300,000,000.
(3) Exclusive of accrued interest and distributions, if any.
(4) No separate consideration will be received for any Guaran-
tees.
The Registrants hereby amend this Registration Statement on such
date or dates as may be necessary to delay its effective date
until the Registrants shall file a further amendment that
specifically states that this Registration Statement shall there-
after become effective in accordance with Section 8(a) of the
Securities Act of 1933, as amended, or until the Registration
Statement shall become effective on such date as the Commission,
acting pursuant to said Section 8(a), may determine.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.*
Securities and Exchange Commission Filing Fee . . $103,449.00
Rating Agency Fees. . . . . . . . . . . . . . . . 105,000.00
Blue Sky Fees and Expenses. . . . . . . . . . . . 15,000.00
Trustee's Expenses. . . . . . . . . . . . . . . . 20,000.00
Printing Fees and Expenses. . . . . . . . . . . . 50,000.00
Accounting Fees and Expenses. . . . . . . . . . . 110,000.00
Legal Fees and Expenses . . . . . . . . . . . . . 140,000.00
Miscellaneous . . . . . . . . . . . . . . . . . . 5,000.00
__________
Total. . . . . . . . . . . . . . . . . . . . $548,449.00
==========
_________________________________
* All fees and expenses other than SEC Registration Fee are
estimated. To be completed by amendment.
Item 15. Indemnification of Directors and Officers.
Article Twelfth of the Restated Certificate of Incorporation of
Southern Union eliminates personal liability of directors to the
fullest extent permitted by Delaware Law. Section 145 of the
Delaware Corporation Law provides that a Delaware corporation may
indemnify any person against expenses, fines and settlements
actually and reasonably incurred by any such person in connection
with a threatened, pending or completed action, suit or proceeding
in which he is involved by reason of the fact that he is or was a
director, officer, employee or agent of such corporation, provided
that (i) he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the
corporation and (ii) with respect to any criminal action or
proceeding, he had no reasonable cause to believe his conduct was
unlawful. If the action or suit is by or in the name of the
corporation, the corporation may indemnify any such person against
expenses actually and reasonably incurred by him in connection with
the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation, except that no
indemnification may be made in respect to any claim, issue or
matter as to which such person shall have been adjudged to be
liable for negligence or misconduct in the performance of his duty
to the corporation, unless and only to the extent that the Delaware
Court of Chancery or the court in which the action or suit is
brought determines upon application that, despite the adjudication
of liability but in the light of the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such
expense as the court deems proper.
The Declaration of each Southern Union Trust provides that no
Southern Union Trustee, affiliate of any Southern Union Trustee, or
any officers, directors, shareholders, members, partners,
employees, representatives or agents of any Southern Union Trustee,
or any employee or agent of such Southern Union Trust or its
affiliates (each an "Indemnified Person") shall be liable,
responsible or accountable in damages or otherwise to such Southern
Union Trust or any employee or agent of the trust or its affiliates
for any loss, damage or claim incurred by reason of any act or
omission performed or omitted by such Indemnified Person in good
faith on behalf of such Southern Union Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of
the authority conferred on such Indemnified Person by such
Declaration or by law, except that an Indemnified Person shall be
liable for any such loss, damage or claim incurred by reason of
such Indemnified Person's gross negligence (or, in the case of the
Property Trustee, negligence) or willful misconduct with respect to
such acts or omissions. The Declaration of each Southern Union
Trust also provides that to the fullest extent permitted by appli-
applicable law, Southern Union shall indemnify and hold harmless
each Indemnified Person from and against any loss, damage or claim
incurred by such Indemnified Person by reason of any act or
omission performed or omitted by such Indemnified Person in good
faith on behalf of such Southern Union Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of
authority conferred on such Indemnified Person by such Declaration,
except that no Indemnified Person shall be entitled to be indemni-
fied in respect of any loss, damage or claim incurred by such
Indemnified Person by reason of gross negligence (or, in the case
of the Property Trustee, negligence) or willful misconduct with
respect to such acts or omissions. The Declaration of each
Southern Union Trust further provides that, to the fullest extent
permitted by applicable law, expenses (including legal fees)
incurred by an Indemnified Person in defending any claim, demand,
action, suit or proceeding shall, from time to time, be advanced by
Southern Union prior to the final disposition of such claim,
demand, action, suit or proceeding upon receipt by or an under-
taking by or on behalf of the Indemnified Person to repay such
amount if it shall be determined that the Indemnified Person is not
entitled to be indemnified for the underlying cause of action as
authorized by such Declaration.
The directors and officers of Southern Union and the Regular
Trustees are covered by insurance policies indemnifying against
certain liabilities, including certain liabilities arising under
the Securities Act of 1933, as amended (the "Securities Act"),
which might be incurred by them in such capacities and against
which they cannot be indemnified by Southern Union or the Southern
Union Trusts.
Any agents, dealers or underwriters who execute any of the agree-
ments filed as Exhibit 1 to this registration statement will agree
to indemnify Southern Union's directors and their officers and the
Southern Union Trustees who signed the registration statement
against certain liabilities that may arise under the Securities Act
with respect to information furnished to Southern Union or any of
the Southern Union Trusts by or on behalf of any such indemnifying
party.
Item 16. Exhibits.
Exhibits identified in parentheses below are on file with the SEC
and are incorporated herein by reference to such previous filings.
All other exhibits are provided as part of this electronic trans-
mission.
1 - Form of Underwriting Agreement for offering of
Preferred Securities.
**4-A - Certificate of Trust of Southern Union Financing I.
**4-B - Certificate of Trust of Southern Union Financing II.
**4-C - Certificate of Trust of Southern Union Financing III.
4-D - Form of Amended and Restated Declaration of Trust of
Southern Union Financing I.
*4-E - Form of Amended and Restated Declaration of Trust of
Southern Union Financing II.
*4-F - Form of Amended and Restated Declaration of Trust of
Southern Union Financing III.
4-G - Form of Subordinated Debt Securities Indenture among
Southern Union Company and The Chase Manhattan Bank,
N.A., as Trustee.
4-H - Form of Supplemental Indenture to Indenture to be used
in connection with the issuance of Subordinated Debt
Securities and Preferred Securities.
4-I - Form of Preferred Security (included in 4-D above).
4-J - Form of Subordinated Debt Security (included in 4-H
above).
4-K - Form of Guarantee with respect to Preferred
Securities.
**4-L - Senior Debt Securities Indenture between The Chase
Manhattan Bank, N.A., as trustee, and Southern Union
Company dated January 31, 1994. (Filed as Exhibit 4.1
to Southern Union's Current Report on Form 8-K dated
February 15, 1994 and incorporated herein by
reference.)
5 - Opinion of Fleischman and Walsh, L.L.P.
8 - Opinion of Skadden, Arps, Slate, Meagher & Flom as to
certain federal income taxation matters.
**12 - Computation of Ratio of Earnings to Fixed Charges of
Southern Union Company.
**23-A - Consent of Independent Accountants, Coopers & Lybrand
L.L.P.
23-B - Consent of Fleischman and Walsh, L.L.P., is contained
in the opinion of counsel filed as Exhibit 5.
23-C - Consent of Skadden, Arps, Slate, Meagher & Flom is
contained in the opinion of counsel filed as Exhibit 8.
**24 - Powers of Attorney (the powers of attorney for the
Southern Union Trustees of Southern Union Financing I,
Southern Union Financing II and Southern Union
Financing III are included in Exhibits 4-A, 4-B and 4-
C, respectively).
25-A - Statement of Eligibility under the Trust Indenture Act
of 1939, as amended, of The Chase Manhattan Bank, N.A.,
as Trustee under the Subordinated Debt Securities
Indenture.
25-B - Statement of Eligibility under the Trust Indenture Act
of 1939, as amended, of The Chase Manhattan Bank, N.A.,
as Trustee, under the Senior Debt Securities Indenture.
25-C - Statement of Eligibility under the Trust Indenture Act
of 1939, as amended, of Wilmington Trust Company, as
Trustee under the Amended and Restated Declaration of
Trust of Southern Union Financing I.
25-D - Statement of Eligibility under the Trust Indenture Act
of 1939, as amended, of Wilmington Trust Company, as
Trustee under the Amended and Restated Declaration of
Trust of Southern Union Financing II.
25-E - Statement of Eligibility under the Trust Indenture Act
of 1939, as amended, of Wilmington Trust Company, as
Trustee under the Amended and Restated Declaration of
Trust of Southern Union Financing III.
25-F - Statement of Eligibility under the Trust Indenture Act
of 1939, as amended, of Wilmington Trust Company, as
Trustee of the Preferred Securities Guarantees of
Southern Union for the benefit of the holders of
Preferred Securities of Southern Union Financing I,
Southern Union Financing II and Southern Union
Financing III.
________________________________
* To be filed by amendment.
** Previously filed.
Item 17. Undertaking.
The Registrants hereby undertake that, for purposes of determining
any liability under the Securities Act, each filing of Southern
Union's Annual Report pursuant to Section 13(a) or Section 15(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act") (and where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Exchange Act)
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 may be permitted to directors, officers and con-
trolling persons of the Registrants pursuant to the provisions
referred to in Item 15 (other than the insurance policies referred
to therein), or otherwise, the Registrants have been advised that,
in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the Registrants of expenses incurred or paid by a director, officer
or controlling person of the Registrants 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 Registrants will, unless in the opinion of
their counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
The Registrants hereby undertake:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration State-
ment
(i) to include any prospectus required by Section 10(a)(3)
of the Securities Act;
(ii) to reflect in the prospectus any facts or events
arising after the effective date of the Registration
Statement (or the most recent post-effective amendment
thereof) that, individually or in the aggregate, repre-
sent 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 the undertakings set forth in paragraphs
(i) and (ii) above do not apply if the information required to be
included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by Southern Union pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorpo-
rated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securi-
ties 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.
The Registrants hereby undertake that:
(1) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed
as part of a registration statement in reliance upon Rule 430A
and contained in the form of prospectus filed by the regis-
trant pursuant to Rule 424(b)(1) or (4) or 497(h) under the
Securities Act shall be deemed to be part of the registration
statement as of the time it was declared effective.
(2) For the purposes of determining any liability under the
Securities Act, each post-effective amendment that contains a
form of prospectus shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
<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 the requirements for filing on Form S-3 and has duly
caused this Amendment to this Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized in the
City of Austin, State of Texas, on May 5, 1995.
SOUTHERN UNION COMPANY
By RONALD J. ENDRES
_____________________________
Ronald J. Endres
Senior Vice President of
Administration and Chief
Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this
Amendment to this Registration Statement has been signed by the
following persons in the capacities indicated on May 5, 1995.
Signature/Name Title
______________ _____
GEORGE L. LINDEMANN* Chairman of the Board,
Chief Executive Officer
and Director
JOHN E. BRENNAN* Director
FRANK W. DENIUS* Director
AARON I. FLEISCHMAN* Director
PETER H. KELLEY* Director
ADAM M. LINDEMANN* Director
ROGER J. PEARSON* Director
GEORGE ROUNTREE, III* Director
DAN K. WASSONG* Director
RONALD J. ENDRES Senior Vice President
________________
Ronald J. Endres of Administration, and
Chief Financial Officer
DAVID J. KVAPIL Vice President and
_______________
David J. Kvapil Controller
(Principal Accounting
Officer)
*By RONALD J. ENDRES
________________
Ronald J. Endres
Attorney-in-fact
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, each of
Southern Union Financing I, Southern Union Financing II and
Southern Union Financing III certifies that it has reasonable
grounds to believe that it meets all the requirements for filing on
Form S-3 and has duly caused this Amendment to this Registration
Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Austin, State of Texas, on the
5th day of May, 1995.
SOUTHERN UNION FINANCING I
By RONALD J. ENDRES
________________
Ronald J. Endres, Trustee
By DAVID J. KVAPIL
_______________
David J. Kvapil, Trustee
SOUTHERN UNION FINANCING II
By RONALD J. ENDRES
________________
Ronald J. Endres, Trustee
By DAVID J. KVAPIL
_______________
David J. Kvapil, Trustee
SOUTHERN UNION FINANCING III
By RONALD J. ENDRES
________________
Ronald J. Endres, Trustee
By DAVID J. KVAPIL
_______________
David J. Kvapil, Trustee
EXHIBIT INDEX
<PAGE>
1 - Form of Underwriting Agreement for offering of
Preferred Securities.
**4-A - Certificate of Trust of Southern Union Financing I.
**4-B - Certificate of Trust of Southern Union Financing II.
**4-C - Certificate of Trust of Southern Union Financing III.
4-D - Form of Amended and Restated Declaration of Trust of
Southern Union Financing I.
*4-E - Form of Amended and Restated Declaration of Trust of
Southern Union Financing II.
*4-F - Form of Amended and Restated Declaration of Trust of
Southern Union Financing III.
4-G - Form of Subordinated Debt Securities Indenture among
Southern Union Company and The Chase Manhattan Bank,
N.A., as Trustee.
4-H - Form of Supplemental Indenture to Indenture to be
used in connection with the issuance of Subordinated
Debt Securities and Preferred Securities.
4-I - Form of Preferred Security (included in 4-D above).
4-J - Form of Subordinated Debt Security (included in 4-H
above).
4-K - Form of Guarantee with respect to Preferred
Securities.
**4-L - Senior Debt Securities Indenture between Chase
Manhattan Bank, N.A., as trustee, and Southern Union
Company dated January 31, 1994. (Filed as Exhibit
4.1 to Southern Union's Current Report on Form 8-K
dated February 15, 1994 and incorporated herein by
reference.
5 - Opinion of Fleischman and Walsh, L.L.P.
8 - Opinion of Skadden, Arps, Slate, Meagher & Flom as to
certain federal income taxation matters.
**12 - Computation of Ratio of Earnings to Fixed Charges of
Southern Union Company.
**23-A - Consent of Independent Accountants, Coopers & Lybrand
L.L.P.
23-B - Consent of Fleischman and Walsh, L.L.P., is contained
in the opinion of counsel filed as Exhibit 5.
23-C - Consent of Skadden, Arps, Slate, Meagher & Flom is
contained in the opinion of counsel filed as Exhibit
8.
**24 - Powers of Attorney (the powers of attorney for the
Southern Union Trustees of Southern Union Financing
I, Southern Union Financing II and Southern Union
Financing III are included in Exhibits 4-A, 4-B and
4-C, respectively).
25-A - Statement of Eligibility under the Trust Indenture
Act of 1939, as amended, of The Chase Manhattan Bank,
N.A., as Trustee under the Subordinated Debt Securi-
ties Indenture.
25-B - Statement of Eligibility under the Trust Indenture
Act of 1939, as amended, of The Chase Manhattan Bank,
N.A., as Trustee under the Senior Debt Securities
Indenture.
25-C - Statement of Eligibility under the Trust Indenture
Act of 1939, as amended, of Wilmington Trust Company,
as Trustee under the Amended and Restated Declaration
of Trust of Southern Union Financing I.
25-D - Statement of Eligibility under the Trust Indenture
Act of 1939, as amended, of Wilmington Trust Company,
as Trustee under the Amended and Restated Declaration
of Trust of Southern Union Financing II.
25-E - Statement of Eligibility under the Trust Indenture
Act of 1939, as amended, of Wilmington Trust Company,
as Trustee under the Amended and Restated Declaration
of Trust of Southern Union Financing III.
25-F - Statement of Eligibility under the Trust Indenture
Act of 1939, as amended, of Wilmington Trust Company,
as Trustee of the Preferred Securities Guarantees of
Southern Union for the benefit of the holders of
Preferred Securities of Southern Union Financing I,
Southern Union Financing II and Southern Union
Financing III.
______________________________
* To be filed by amendment.
** Previously filed.
<PAGE>
_________ Preferred Securities
SOUTHERN UNION FINANCING I
(a Delaware Trust)
% Trust Originated Preferred Securities ("TOPrS")
(Liquidation Amount of $25 Per Preferred Security)SM
UNDERWRITING AGREEMENT
May ___, 1995
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
as Representative of the several Underwriters
Merrill Lynch World Headquarters
North Tower
World Financial Center
New York, New York 10281
Dear Sirs:
Southern Union Financing I (the "Trust"), a
statutory business trust organized under the Business
Trust Act (the "Delaware Act") of the State of Delaware
(Chapter 38, Title 12, of the Delaware Code, 12 Del. C.
SECTION 3801 et seq.), and Southern Union Company, a
Delaware
corporation (the "Company" and, together with the Trust,
the "Offerors") confirm their agreement (the "Agreement")
with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner
& Smith Incorporated ("Merrill Lynch") and each of the
other Underwriters named in Schedule A hereto
(collectively, the "Underwriters", which term shall also
include any underwriter substituted as hereinafter
provided in Section 10 hereof), for whom Merrill Lynch is
acting as representative (in such capacity, Merrill Lynch
shall hereinafter be
____________________
SM "Trust Originated Preferred Securities" and "TOPrS"
are service marks of Merrill Lynch & Co., Inc.
referred to as the "Representative"), with respect to the
sale by the Trust and the purchase by the Underwriters,
acting severally and not jointly, of the respective
numbers of ___% Trust Originated Preferred Securities
(liquidation amount of $25 per preferred security) of the
Trust ("Preferred Securities") set forth in said Schedule
A and with respect to the grant by the Trust to the
Underwriters, acting severally and not jointly, of the
option described in Section 2(b) hereof to purchase all
or any part of additional Preferred Securities to
cover over-allotments, in each case except as may
otherwise be provided in the Pricing Agreement, as
hereinafter defined. The aforesaid Preferred
Securities (the "Initial Securities") to be purchased
by the Underwriters and all or any part of the
additional Preferred Securities subject to the option
described in Section 2(b) hereof (the "Option
Securities") are collectively hereinafter called the
"Designated Securities". The Preferred Securities will
be guaranteed by the Company with respect to
distributions and payments upon liquidation, redemption
and otherwise (the "Preferred Securities Guarantee")
pursuant to the Preferred Securities Guarantee Agreement
(the "Preferred Securities Guarantee Agreement"), dated
as of May , 1995, between the Company and Wilmington
Trust Company, as Trustee (the "Guarantee Trustee"), and
entitled to the benefits of certain backup undertakings
described in the Prospectus with respect to the Company's
agreement pursuant to the Supplemental Indenture (as
defined herein) to pay all expenses relating to
administration of the Trust (the "Undertakings"). The
Preferred Securities and the related Preferred Securities
Guarantees are referred to herein as the "Securities".
Prior to the purchase and public offering of
the Designated Securities by the several Underwriters,
the Offerors and the Representative, acting on behalf of
the several Underwriters, shall enter into an agreement
substantially in the form of Exhibit A hereto (the
"Pricing Agreement"). The Pricing Agreement may take the
form of an exchange of any standard form of written
telecommunication between the Offerors and the
Representative and shall specify such applicable
information as is indicated in Exhibit A hereto. The
offering of the Designated Securities will be governed by
this Agreement, as supplemented by the Pricing Agreement.
From and after the date of the execution and delivery of
the Pricing Agreement, this Agreement shall be deemed to
incorporate the Pricing Agreement.
The Offerors have filed with the Securities and
Exchange Commission (the "Commission") a registration
statement on Form S-3 (No. 33-58297) and a related
preliminary prospectus for the registration under the
Securities Act of 1933 (the "1933 Act") of (i) the
Preferred Securities, (ii) the Preferred Securities
Guarantee, and (iii) $ million aggregate principal
amount of Subordinated Deferrable Interest Notes (the
"Subordinated Debt Securities") to be issued and sold to
the Trust by the Company, have filed such amendments
thereto, if any, and such amended preliminary
prospectuses as may have been required to the date
hereof, and will file such additional amendments thereto
and such amended prospectuses as may hereafter be
required. Such registration statement (as amended, if
applicable) and the prospectus constituting a part
thereof (including, in each case, all documents
incorporated or deemed to be incorporated by reference
therein pursuant to Item 12 of Form S-3 under the 1933
Act and the information, if any, deemed to be part
thereof pursuant to Rule 430A(b) of the rules and
regulations of the Commission under the 1933 Act (the
"1933 Act Regulations")), as from time to time amended or
supplemented pursuant to the 1933 Act, the Securities
Exchange Act of 1934, as amended (the "1934 Act") or
otherwise, are herein after referred to as the
"Registration Statement" and the "Prospectus",
respectively, except that if any revised prospectus shall
be provided to the Underwriters by the Offerors for use
in connection with the offering of the Designated
Securities, which differs from the Prospectus on file at
the Commission at the time the Registration Statement
becomes effective (whether or not such revised prospectus
is required to be filed by the Offerors pursuant to Rule
424(b) of the 1933 Act Regulations), the term
"Prospectus" shall refer to such revised prospectus from
and after the time it is first provided to the
Underwriters for such use. All references in this
Agreement to financial statements and schedules and other
information that is "contained," "included" or "stated"
in the Registration Statement or the Prospectus (and all
other references of like import) shall be deemed to mean
and include all such financial statements and schedules
and other information that are or are deemed to be
incorporated by reference in the Registration Statement
or the Prospectus, as the case may be; and all references
in this Agreement to amendments or supplements to the
Registration Statement or the Prospectus shall be deemed
to mean and include the filing of any document under the
1934 Act that is or is deemed to be incorporated by
reference in the Registration Statement or the
Prospectus, as the case may be.
The Offerors understand that the Underwriters
propose to make a public offering of the Securities as
soon as the Representative deems advisable after the
Pricing Agreement has been executed and delivered, and
the Declaration (as defined herein), the Indenture (as
defined herein), and the Preferred Securities Guarantee
Agreement have been qualified under the Trust Indenture
Act of 1939, as amended (the "1939 Act"). The entire
proceeds from the sale of the Securities will be combined
with the entire proceeds from the sale by the Trust to
the Company of its common securities (the "Common
Securities") guaranteed by the Company, to the extent set
forth in the Prospectus, with respect to distributions
and payments upon liquidation, and redemption (the
"Common Securities Guarantee" and together with the
Preferred Securities Guarantee, the "Guarantees")
pursuant to the Common Securities Guarantee Agreement
(the "Common Securities Guarantee Agreement" and,
together with the Preferred Securities Guarantee
Agreement, the "Guarantee Agreements"), dated as of May
, 1995, between the Guarantee Trustee, as Trustee, and
will be used by the Trust to purchase the Subordinated
Debt Securities issued by the Company. The Preferred
Securities and the Common Securities will be issued
pursuant to the amended and restated declaration of trust
of the Trust, dated as of May __, 1995 (the
"Declaration"), among the Company, as Sponsor, the
trustees named therein (the "Trustees") and the holders
from time to time of undivided beneficial interests in
the assets of the Trust. The Subordinated Debt
Securities will be issued pursuant to an indenture, dated
as of May , 1995 (the "Base Indenture"), among the
Company and The Chase Manhattan Bank, as trustee (the
"Debt Trustee"), and a supplement to the Base Indenture,
dated as of May , 1995 (the "Supplemental Indenture,"
and together with the Base Indenture and any other
amendments or supplements thereto, the "Indenture"),
among the Company and the Debt Trustee.
Section 1. Representations and Warranties.
(a) The Offerors jointly and severally
represent and warrant to each Underwriter as of the date
hereof and as of the date of the Pricing Agreement (such
latter date being hereinafter referred to as the
"Representation Date") as follows:
(i) At the time the Registration
Statement becomes effective and at the
Representation Date, the Registration Statement will
comply in all material respects with the
requirements of the 1933 Act and the 1933 Act
Regulations and the 1939 Act and the rules and
regulations of the Commission under the 1939 Act
(the "1939 Act Regulations"), and will not contain
an untrue statement of a material fact or omit to
state a material fact required to be stated therein
or necessary to make the statements therein not
misleading. The Prospectus, at the Representation
Date (unless the term "Prospectus" refers to a
prospectus that has been provided to the
Underwriters by the Trust for use in connection with
the offering of the Securities and that differs from
the Prospectus on file at the Commission at the time
the Registration Statement becomes effective, in
which case, at the time it is first provided to the
Underwriters for such use) and at Closing Time
referred to in Section 2 hereof, will not include an
untrue statement of a material fact or omit to state
a material fact necessary in order to make the
statements therein, in the light of the
circumstances under which they were made, not
misleading; provided, however, that the
representations and warranties in this subsection
shall not apply to statements in or omissions from
the Registration Statement or Prospectus made in
reliance upon and in conformity with information
furnished to the Offerors in writing by any
Underwriter through Merrill Lynch expressly for use
in the Registration Statement or Prospectus.
(ii) The documents incorporated or
deemed to be incorporated by reference in the
Registration Statement or Prospectus, at the time
they were or hereafter are filed with the
Commission, complied and will comply in all material
respects with the requirements of the 1933 Act, the
1933 Act Regulations, the 1934 Act and the rules and
regulations of the Commission under the 1934 Act
(the "1934 Act Regulations"), as applicable, and, at
the time the Registration Statement and any
amendments thereto become effective and at the
Closing Time, will not contain an untrue statement
of a material fact or omit to state a material fact
required to be stated therein or necessary to make
the statements therein, in the light of the
circumstances under which they were made, not
misleading; provided, however, that the
representations and warranties in this subsection
shall not apply to statements in or omissions from
the Registration Statement or Prospectus made in
reliance upon and in conformity with information
furnished to the Offerors in writing by any
Underwriter through Merrill Lynch expressly for use
in the Registration Statement or Prospectus.
(iii) Coopers & Lybrand, the
accountants who certified the financial statements
and supporting schedules included in the
Registration Statement, are independent public
accountants as required by the 1933 Act and the 1933
Act Regulations.
(iv) The financial statements
included in the Registration Statement and the
Prospectus present fairly the financial position of
the Company and its consolidated subsidiaries as at
the dates indicated and the results of their
operations for the periods specified; except as
otherwise stated in the Registration Statement, said
financial statements have been prepared in
conformity with generally accepted accounting
principles applied on a consistent basis; the
Company's ratios of earnings to fixed charges
(actual and, if any, pro forma) included in the
Prospectus under the caption "Ratio of Earnings to
Fixed Charges" and in Exhibit 12 to the Registration
Statement have been calculated in compliance with
Item 503(d) of Regulation S-K of the Commission and
the supporting schedules included in the
Registration Statement present fairly the
information required to be stated therein; and the
selected financial data included or incorporated by
reference in the Prospectus present fairly the
information shown therein and have been compiled on
a basis consistent with that of the audited
consolidated financial statements included or
incorporated by reference in the Registration
Statement. The Prospectus contains all pro forma
financial statements and other pro forma financial
information required to be included therein and such
information presents fairly the information shown
therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to
pro forma financial statements, have been properly
compiled on the pro forma bases described therein,
and, in the opinion of the Company, the assumptions
used in the preparation thereof are reasonable and
the adjustments used therein are appropriate to give
effect to the transactions or circumstances referred
to therein.
(v) Each of the Offerors meets, and
at the respective times of commencement and
consummation of the offering of the Securities will
meet, the registrant requirements for use of Form S-
3 under the 1933 Act and the 1933 Act Regulations.
(vi) Since the respective dates as
of which information is given in the Registration
Statement and the Prospectus, except as otherwise
stated therein, (A) there has been no material
adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or
business prospects of the Company and its
subsidiaries, considered as one enterprise or of
the Trust, whether or not arising in the ordinary
course of business, and (B) there have been no
transactions entered into by the Trust or by the
Company or any of its subsidiaries, other than those
in the ordinary course of business, which are
material with respect to the Trust or the Company
and its subsidiaries, considered as one enterprise.
(vii) The Company has been duly
incorporated and is validly existing as a
corporation in good standing under the laws of the
State of Delaware with corporate power and authority
to own, lease and operate its properties and to
conduct its business as described in the
Registration Statement and Prospectus, to enter into
and perform its obligations under this Agreement,
the Pricing Agreement, the Declaration, the
Indenture and each of the Guarantees and to
purchase, own, and hold the Common Securities issued
by the Trust; and the Company is duly qualified as
a foreign corporation to transact business and is in
good standing in each jurisdiction in which such
qualification is required, whether by reason of the
ownership or leasing of property or the conduct of
business, except where the failure so to qualify
would not have a material adverse effect on the
condition, financial or otherwise, or the earnings,
business affairs or business prospects of the
Company and its subsidiaries considered as one
enterprise.
(viii) The authorized, issued and
outstanding capital stock of the Company is as set
forth in the Prospectus under "Capitalization of
Southern Union at March 31, 1995" (except for
subsequent issuances, if any, pursuant to
reservations, agreements, employee benefit plans or
the exercise of convertible securities referred to
in the Prospectus); and all of the issued and
outstanding shares of capital stock of the Company
have been duly authorized and validly issued and are
fully paid and non-assessable.
(ix) The Company's only active
subsidiaries are Southern Union Econofuel Company,
Southern Transmission Company, Lavaca Realty
Company, Mercado Gas Services Inc., Western Gas
Interstate Company, Southern Union Energy Products
and Services Company and Southern Union Energy
International, Inc. (collectively, the
"Subsidiaries"). In addition, the Company holds a
50% equity interest in Natural Gas Vehicle
Technology Centers L.L.P. Each Subsidiary is a
corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction of
its incorporation with corporate power and authority
under such laws to own, lease and operate its
properties and conduct its business; and each
Subsidiary is duly qualified to transact business as
a foreign corporation and is in good standing in
each other jurisdiction in which it owns or leases
property of a nature, or transacts business of a
type, that would make such qualification necessary,
except to the extent that the failure to so qualify
or be in good standing would not have a material
adverse effect on the Company and its subsidiaries,
considered as one enterprise. All of the
outstanding shares of capital stock of each
Subsidiary have been duly authorized and validly
issued and are fully paid and non-assessable and are
owned by the Company free and clear of any pledge,
lien, security interest, charge, claim, equity or
encumbrance of any kind.
(x) The Trust has been duly created
and is validly existing in good standing as a
business trust under the Delaware Act with the power
and authority to own property and to conduct its
business as described in the Registration Statement
and Prospectus and to enter into and perform its
obligations under this Agreement, the Pricing
Agreement, the Preferred Securities, the Common
Securities and the Declaration and is not required
to be authorized to do business in any other
jurisdiction; the Trust is not a party to or
otherwise bound by any agreement other than those
described in the Prospectus; the Trust is not and
will not be classified as an association taxable as
a corporation for United States federal income tax
purposes; and the Trust is and will be treated as a
consolidated subsidiary of the Company pursuant to
generally accepted accounting principles.
(xi) The Common Securities have been
duly authorized by the Declaration and, when issued
and delivered by the Trust to the Company against
payment therefor as described in the Registration
Statement and Prospectus, will be validly issued and
(subject to the terms of the Declaration) fully paid
and non-assessable undivided beneficial interests in
the assets of the Trust and will conform to all
statements relating thereto contained in the
Prospectus; the issuance of the Common Securities is
not subject to preemptive or other similar rights;
and at the Closing Time, all of the issued and
outstanding Common Securities of the Trust will be,
directly owned by the Company free and clear of any
security interest, mortgage, pledge, lien,
encumbrance, claim or equity.
(xii) This Agreement has been and at
Closing Time, the Pricing Agreement will have been
duly authorized, executed and delivered by each of
the Offerors.
(xiii) The Declaration has been duly
authorized, by the Company and, at the Closing Time,
will have been duly executed and delivered by the
Company and the Trustees, and assuming due
authorization, execution and delivery of the
Declaration by the Property Trustee, the Declaration
will, at the Closing Time, be a valid and binding
obligation of the Company and the Trustees,
enforceable against the Company and the Trustees in
accordance with its terms, except to the extent that
enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other
similar laws affecting creditors rights generally or
by general principles of equity (regardless of
whether enforcement is considered in a proceeding at
law or in equity) (the "Bankruptcy Exceptions") and
will conform to all statements relating thereto in
the Prospectus; and at the Closing Time, the
Declaration will have been duly qualified under the
1939 Act.
(xiv) Each of (i) Common Securities
Guarantee Agreement and (ii) the Preferred
Securities Guarantee Agreement has been duly
authorized by the Company and, when validly executed
and delivered by the Company, will constitute a
valid and binding obligation of the Company,
enforceable against the Company in accordance with
its terms and the Guarantees and the Guarantee
Agreements will conform to all statements relating
thereto contained in the Prospectus; and the
Preferred Securities Guarantee Agreement, at the
Closing Time, will have been duly qualified under
the 1939 Act.
(xv) The Preferred Securities have
been duly authorized by the Declaration and, when
issued and delivered pursuant to this Agreement
against payment of the consideration set forth in
the Pricing Agreement, will be validly issued and
(subject to the terms of the Declaration) fully paid
and non-assessable undivided beneficial interests in
the Trust, will be entitled to the benefits of the
Declaration and will conform to all statements
relating thereto contained in the Prospectus; the
issuance of the Preferred Securities is not subject
to preemptive or other similar rights; holders of
Preferred Securities will be entitled to the same
limitation of personal liability extended to
stockholders of private corporations for profit.
(xvi) The Indenture has been duly
authorized by the Company and, when validly executed
and delivered by the Company, will constitute a
valid and binding agreement of the Company,
enforceable against the Company in accordance with
its terms except to the extent that enforcement
thereof may be limited by Bankruptcy Exceptions; the
Indenture will conform to all statements relating
thereto contained in the Prospectus; and at the
Closing Time, the Indenture will have been duly
qualified under the 1939 Act.
(xvii) The Subordinated Debt
Securities have been duly authorized by the Company
and, at the Closing Time, will have been duly
executed by the Company and, when authenticated in
the manner provided for in the Indenture and
delivered against payment therefor as described in
the Prospectus, will constitute valid and binding
obligations of the Company, enforceable against the
Company in accordance with their terms, will be in
the form contemplated by, and entitled to the
benefits of, the Indenture and will conform to all
statements relating thereto in the Prospectus.
(xviii) The Company's obligations
under the Preferred Securities Guarantee and Common
Securities Guarantee are subordinate and junior in
right of payment to all liabilities of the Company
and are pari passu with the most senior preferred
stock issued by the Company.
(xix) The Subordinated Debt
Securities are subordinated and junior in right of
payment to all senior indebtedness (as defined in
the Supplemental Indenture) of the Company.
(xx) Ronald J. Endres and David S.
Kvapil, Trustees (the "Regular Trustees") of the
Trust, are employees of the Company and have been
duly authorized by the Company to execute and
deliver the Declaration; the Declaration has been
duly executed and delivered by the Regular Trustees
and is a valid and binding obligation of each
Regular Trustee, enforceable against such Regular
Trustee in accordance with its terms.
(xxi) None of the Offerors is an
"investment company" or a company "controlled" by an
"investment company" within the meaning of the
Investment Company Act of 1940, as amended (the
"1940 Act").
(xxii) Neither the Company nor any
of the Subsidiaries is in violation of its charter
or by-laws; the Trust is not in violation of the
Declaration or its Certificate of Trust filed with
the State of Delaware on March 28, 1995 (the
"Certificate of Trust"); none of the Company, any of
the Subsidiaries or the Trust is in default in the
performance or observance of any material
obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which
the Company, any of the Subsidiaries or the Trust is
a party or by which it or any of them may be bound,
or to which any of the property or assets of the
Company, any of its the Subsidiaries or the Trust is
subject, except for such defaults that would not
have a material adverse effect on the condition
(financial or otherwise), earnings, business affairs
or business prospects of the Trust or of the Company
and its subsidiaries, considered as one enterprise;
and the execution, delivery and performance of this
Agreement, the Pricing Agreement, the Declaration,
the Preferred Securities, the Common Securities, the
Indenture, the Subordinated Debt Securities, the
Guarantee Agreements and the Guarantees and the
consummation of the transactions contemplated herein
and therein and compliance by the Offerors with
their respective obligations hereunder and
thereunder have been duly authorized by all
necessary action (corporate or otherwise) on the
part of the Offerors and do not and will not result
in any violation of the charter or by-laws of the
Company or any Subsidiary, or the Declaration or
Certificate of Trust and do not and will not
conflict with, or result in a breach of any of the
terms or provisions of, or constitute a default
under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or
assets of the Trust, the Company or any Subsidiary
under (A) any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or
instrument to which the Trust, the Company or any
Subsidiary is a party or by which it may be bound or
to which any of its properties may be subject
(except for such conflicts, breaches or defaults or
liens, charges or encumbrances that would not have
a material adverse effect on the condition (financial
or otherwise), earnings, business affairs or
business prospects of the Trust or the Company and
its subsidiaries, considered as one enterprise) or
(B) any existing applicable law, rule, regulation,
judgment, order or decree of any government,
governmental instrumentality or court, domestic or
foreign, or any regulatory body or administrative
agency or other governmental body having
jurisdiction over the Trust, the Company, or any
Subsidiary or any of their respective properties.
(xxiii) Except as disclosed in the
Prospectus, there is no action, suit or proceeding
before or by any government, governmental
instrumentality or court, domestic or foreign, now
pending or, to the knowledge of the Trust or the
Company, threatened against or affecting the Trust,
the Company or any Subsidiary that is required to be
disclosed in the Prospectus or that could result in
any material adverse change in the condition
(financial or otherwise), earnings, business affairs
or business prospects of the Trust or the Company
and its subsidiaries, considered as one enterprise,
or that could materially and adversely affect the
properties or assets of the Trust or the Company and
its subsidiaries, considered as one enterprise, or
that could adversely affect the consummation of the
transactions contemplated in this Agreement or any
applicable Pricing Agreement; the aggregate of all
pending legal or governmental proceedings that are
not described in the Prospectus to which the Trust,
the Company or any Subsidiary is a party or which
affect any of their respective properties, including
ordinary routine litigation incidental to the
business of the Trust, the Company or any
Subsidiary, would not have a material adverse effect
on the condition (financial or otherwise), earnings,
business affairs or business prospects of the Trust
or the Company and its subsidiaries, considered as
one enterprise; and there are no contracts or
documents of the Company, any of its subsidiaries or
the Trust that are required to be filed as exhibits
to the Registration Statement by the 1933 Act or by
the 1933 Act Regulations that have not been so
filed.
(xxiv) No authorization, approval,
consent or order of any court or governmental
authority or agency is necessary in connection with
the issuance and sale of the Common Securities or
the offering of the Preferred Securities, the
Subordinated Debt Securities or the Guarantees
hereunder, except such as may be required under the
1933 Act or the 1933 Act Regulations or state
securities laws and the qualification of the
Declaration and the Indenture under the 1939 Act.
(xxv) The Company and the
Subsidiaries each has good and marketable title to
all properties and assets described in the
Prospectus as owned by it, free and clear of all
liens, charges, encumbrances or restrictions, except
such as (A) are described in the Prospectus or (B)
are neither material in amount nor materially
significant in relation to the business of the
Company and its subsidiaries, considered as one
enterprise; all of the leases and subleases material
to the business of the Company and its subsidiaries,
considered as one enterprise, and under which the
Company or any Subsidiary holds properties described
in the Prospectus, are in full force and effect, and
neither the Company nor any Subsidiary has any
notice of any material claim of any sort that has
been asserted by anyone adverse to the rights of the
Company or any Subsidiary under any of the leases or
subleases mentioned above, or affecting or
questioning the rights of such corporation to the
continued possession of the leased or subleased
premises under any such lease or sublease.
(xxvi) Each of the Trust, the
Company, and the Subsidiaries and the Trust own,
possesses, or has obtained, material licenses,
franchises, consents, orders, approvals, permits,
certificates, and other authorizations issued by the
appropriate state, federal or foreign regulatory
agencies or bodies necessary to conduct the business
now operated by them, and none of the Trust, the
Company, and any of the Subsidiaries has received
any notice of proceedings relating to the revocation
or modification of any such certificate, authority
or permit which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or
finding, would materially and adversely affect the
condition, financial or otherwise, or the earnings,
business affairs or business prospects of the Trust
or of the Company and its subsidiaries considered as
one enterprise.
(xxvii) The Company and the
Subsidiaries each owns or possesses, or can acquire
on reasonable terms, adequate patents, patent
licenses, trademarks, service marks and trade names
necessary to carry on its business as presently
conducted, and neither the Company nor any
Subsidiary has received any notice of infringement
of or conflict with asserted rights of others with
respect to any patents, patent licenses, trademarks,
service marks or trade names that in the aggregate,
if the subject of an unfavorable decision, ruling or
finding, could materially adversely affect the
condition (financial or otherwise), earnings,
business affairs or business prospects of the
Company and its subsidiaries, considered as one
enterprise.
(xxviii) To the best knowledge of
the Company, no labor problem exists with its
employees or with employees of the Subsidiaries or
is imminent that could adversely affect the company
and its subsidiaries, considered as one enterprise,
and the Company is not aware of any existing or
imminent labor disturbance by the employees of any
of its or the Subsidiaries' principal suppliers,
contractors or customers that could be expected to
materially adversely affect the condition (financial
or otherwise), earnings, business affairs or
business prospects of the company and its
subsidiaries, considered as one enterprise.
(xxix) The Company and the Trust
have not taken and will not take, directly or
indirectly, any action designed to, or that might be
reasonably expected to, cause or result in
stabilization or manipulation of the price of the
Offered Securities.
(xxx) Except as disclosed in the
Registration Statement and except as would not
individually or in the aggregate have a material
adverse effect on the condition (financial or
otherwise), earnings, business affairs or business
prospects of the Company and its subsidiaries,
considered as one enterprise, (A) the Company and
the Subsidiaries are each in compliance with all
applicable Environmental Laws (as defined below),
(B) the Company and the Subsidiaries have all
permits, authorizations and approvals required under
any applicable Environmental Laws and are each in
compliance with their requirements, (C) there are no
pending or threatened Environmental Claims against
the Company or any of the Subsidiaries, and (D)
there are no circumstances with respect to any
property or operations of the Company or the
Subsidiaries that could reasonably be anticipated to
form the basis of an Environmental Claim (as
defined below) against the Company or the
Subsidiaries.
For purposes of this Agreement, the following
terms shall have the following meanings:
"Environmental Law" means any United States (or
other applicable jurisdiction's) federal, state,
local or municipal statute, law, rule, regulation,
ordinance, code, policy or rule of common law and
any judicial or administrative interpretation
thereof including any judicial or administrative
order, consent decree or judgment, relating to the
environment, health, safety or any chemical,
material or substance, exposure to which is
prohibited, limited or regulated by any governmental
authority. "Environmental Claims" means any and all
administrative, regulatory or judicial actions,
suits, demands, demand letters, claims, liens,
notices of noncompliance or violation,
investigations or proceedings relating in any way to
any Environmental Law.
(xxxi) The Company through its
operating divisions provides gas distribution
utility services which are subject to regulation by
the Oklahoma Corporation Commission, the Railroad
Commission of the State of Texas, the Missouri
Public Service Commission, and with respect to rates
and certain other matters, by various municipalities
served by the Company. The Company is also subject
to regulation by the Federal Department of
Transportation with respect to pipeline safety. The
Company's operations are not subject to regulation
by the Securities and Exchange Commission under the
Public Utility Holding Company Act of 1935, as
amended ("PUCHA"). Except with respect to the
transportation of gas on a no-fee exchange basis
which is the subject of a limited jurisdiction
certificate granted on January __, 1994 (Docket No.
CP93-750-000) and the operation of the Company's
subsidiary, Western Gas Interstate Company, the
Company's operations are not subject to the
jurisdiction of the Federal Energy Regulatory
Commission, the Federal Energy Administration or,
except as set forth above, any other regulatory
authority having jurisdiction over utilities or
utility related matters.
(xxxii) The Company and the
Subsidiaries have filed all material federal, state
and local tax returns and other reports which have
been required to be filed and have paid all taxes
and fees indicated by said returns and reports and
franchise reports and all assessments received by
them or any of them to the extent that such taxes
and/or fees have become due, except where being
contested in good faith and for which the Company
has established adequate reserves.
(xxxiii) Each of the Offerors is in
compliance with all provisions of Section 1 of the
Laws of Florida, Chapter 92-198, An Act Relating to
Disclosure of Doing Business With Cuba.
Section 2. Sale and Delivery to Under-
writers; Closing.
(a) On the basis of the representations
and warranties herein contained and subject to the terms
and conditions herein set forth, the Trust agrees to sell
to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to
purchase from the Trust, at the price per security set
forth in the Pricing Agreement, the number of Initial
Securities set forth in Schedule A opposite the name of
such Underwriter (except as otherwise provided in the
Pricing Agreement), plus any additional number of Initial
Securities that such Underwriter may become obligated to
purchase pursuant to the provisions of Section 10 hereof.
The purchase price per security to be paid by
the several Underwriters for the Initial Securities shall
be an amount equal to the initial public offering price.
The initial public offering price per Initial Security
shall be a fixed price to be determined by agreement
between the Representative and the Offerors. The initial
public offering price and the purchase price, when so
determined, shall be set forth in the Pricing Agreement.
In the event that such prices have not been agreed upon
and the Pricing Agreement has not been executed and
delivered by all parties thereto by the close of business
on the fourth business day following the date of this
Agreement, this Agreement shall terminate forthwith,
without liability of any party to any other party, unless
otherwise agreed to by the Offerors and the
Representative. As compensation to the Underwriters for
their commitments hereunder and in view of the fact that
the proceeds of the sale of the Initial Securities will
be used to purchase the Subordinated Debt Securities of
the Company, the Company hereby agrees to pay at Closing
Time (as defined below) to the Representative, for the
accounts of the several Underwriters, a commission per
Initial Security determined by agreement between the
Representative and the Company for the Preferred
Securities to be delivered by the Trust hereunder at
Closing Time. The commission, when so determined, shall
be set forth in the Pricing Agreement.
(b) In addition, on the basis of the
representations and warranties herein contained and
subject to the terms and conditions herein set forth, the
Trust hereby grants an option to the Underwriters,
severally and not jointly, to purchase up to an
additional Preferred Securities at the price per
security set forth in the Pricing Agreement, less an
amount per share equal to any dividends declared by the
Trust and payable on the Initial Securities but not
payable on the Option Securities. The Company agrees to
pay at the relevant Date of Delivery (as defined below)
to the Representatives for the accounts of the several
Underwriters the commission per security set forth in the
Pricing Agreement with respect to the Option Securities.
The option hereby granted will expire 30 days after the
Representation Date and may be exercised in whole or in
part from time to time only for the purpose of covering
over-allotments which may be made in connection with the
offering and distribution of the Initial Securities upon
notice by the Representative to the Trust setting forth
the number of Option Securities as to which the several
Underwriters are then exercising the option and the time
and date of payment and delivery for such Option
Securities. Any such time and date of delivery (a "Date
of Delivery") shall be determined by the Representative,
but shall not be later than seven full business days
after the exercise of said option, nor in any event prior
to the Closing Time, as hereinafter defined, unless
otherwise agreed by the Representative and the Trust. If
the option is exercised as to all or any portion of the
Option Securities, each of the Underwriters, acting
severally and not jointly, will purchase that proportion
of the total number of Option Securities then being
purchased which the number of Initial Securities set
forth in Schedule A opposite the name of such Underwriter
bears to the total number of Initial Securities (except
as otherwise provided in the Pricing Agreement), subject
in each case to such adjustments as the Representative in
its discretion shall make to eliminate any sales or
purchases of fractional securities.
(c) Payment of the purchase price for,
and delivery of certificates for, the Initial Securities
shall be made at the office of Skadden, Arps, Slate,
Meagher & Flom, or at such other place as shall be agreed
upon by the Representative and the Trust, at 10:00 A.M.
New York time on the fifth business day (unless postponed
in accordance with the provisions of Section 10) after
execution of the Pricing Agreement, or such other time
not later than ten business days after such date as shall
be agreed upon by the Representative, the Trust, the
Company (such time and date of payment and delivery being
herein called "Closing Time"). In addition, in the event
that any or all of the Option Securities are purchased by
the Underwriters, payment of the purchase price for, and
delivery of certificates for, such Option Securities
shall be made at the above-mentioned offices of Skadden,
Arps, Slate, Meagher & Flom, or at such other place as
shall be agreed upon by the Representative and the Trust,
on each Date of Delivery as specified in the notice from
the Representative to the Trust. Payment shall be made
to the Trust by certified or official bank check or
checks drawn in New York Clearing House funds or similar
next day funds payable to the order of the Trust to an
account designated by the Trust, against delivery to the
Representative for the respective accounts of the
Underwriters of certificates for the Designated
Securities to be purchased by them. Certificates for the
Initial Securities and the Option Securities, if any,
shall be in such denominations and registered in such
names as the Representative may request in writing at
least two business days before the Closing Time or the
relevant Date of Delivery, as the case may be. It is
understood that each Underwriter has authorized the
Representative, for its account, to accept delivery of,
receipt for, and make payment of the purchase price for,
the Initial Securities and the Option Securities, if any,
which it has agreed to purchase. Merrill Lynch,
individually and not as representative of the
Underwriters, may (but shall not be obligated to) make
payment of the purchase price for the Initial Securities
or the Option Securities, if any, to be purchased by any
Underwriter whose check has not been received by the
Closing Time or the relevant Date of Delivery, as the
case may be, but such payment shall not relieve such
Underwriter from its obligations hereunder.
The certificates for the Initial Securities and
the Option Securities, if any, will be made available for
examination and packaging by the Representative not later
than 10:00 A.M. on the last business day prior to the
Closing Time or the relevant Date of Delivery, as the
case may be.
At the Closing Time or each Date of Delivery,
as the case may be, the Company will pay, or cause to be
paid, the commission payable at such time to the
Underwriters under Section 2 hereof by certified or
official bank check or checks payable to Merrill Lynch,
Pierce, Fenner & Smith Incorporated in New York Clearing
House funds or other similar next day funds.
Section 3. Covenants of the Offerors. Each of
the Offerors jointly and severally covenant with each
Underwriter as follows:
(a) The Offerors will notify the
Representative immediately, and confirm the notice in
writing, (i) of the effectiveness of the Registration
Statement and any amendment thereto (including any post-
effective amendment), (ii) of the receipt of any comments
from the Commission, (iii) of any request by the
Commission for any amendment to the Registration
Statement or any amendment or supplement to the
Prospectus or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose. The
Offerors will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is
issued, to obtain the lifting thereof at the earliest
possible moment.
(b) The Offerors will give the
Representative notice of their intention to file or
prepare (i) any amendment to the Registration Statement
(including any post-effective amendment), (ii) any
amendment or supplement to the Prospectus (including any
revised prospectus which the Offerors propose for use by
the Underwriters in connection with the offering of the
Preferred Securities which differs from the prospectus on
file at the Commission at the time the Registration
Statement becomes effective, whether or not such revised
prospectus is required to be filed pursuant to Rule
424(b) of the 1933 Act Regulations), or (iii) any
document that would as a result thereof be incorporated
by reference in the Prospectus whether pursuant to the
1933 Act, the 1934 Act or otherwise, will furnish the
Representative with copies of any such amendment,
supplement or other document a reasonable amount of time
prior to such proposed filing or use, as the case may be,
and will not file any such amendment, supplement or other
document or use any such prospectus to which the
Representative or counsel for the Underwriters shall
reasonably object. Subject to the foregoing, the
Offerors will promptly prepare a supplement to the
Prospectus to reflect the terms of the Designated
Securities and the terms of the offering. The Offerors
will file the Prospectus as so supplemented pursuant to
Rule 424(b) under the Act not later than the Commission's
close of business on the second business day following
the execution and delivery of this Agreement, or, if
applicable, such earlier time as may be required by Rule
430A(a)(3) under the Act.
(c) The Offerors will deliver to the
Representative as many signed copies of the Registration
Statement as originally filed and of each amendment
thereto (including exhibits filed therewith or
incorporated by reference therein and documents
incorporated or deemed to be incorporated by reference
therein) as the Representative may reasonably request and
will also deliver to the Representative a conformed copy
of the Registration Statement as originally filed and of
each amendment thereto (without exhibits) for each of the
Underwriters.
(d) The Offerors will furnish to each
Underwriter, from time to time during the period when the
Prospectus is required to be delivered under the 1933
Act, such number of copies of the Prospectus (as amended
or supplemented) as such Underwriter may reasonably
request for the purposes contemplated by the 1933 Act or
the respective applicable rules and regulations of the
Commission thereunder.
(e) If at any time when the Prospectus is
required by the 1933 Act to be delivered in connection
with sales of the Designated Securities, any event shall
occur as a result of which it is necessary, in the
opinion of counsel for the Underwriters or counsel to the
Company and the Trust, to amend or supplement the
Prospectus in order to make the Prospectus not misleading
in the light of the circumstances existing at the time it
is delivered to a purchaser, or if it shall be necessary
at any such time, to amend the Registration Statement or
amend or supplement the Prospectus in order to comply
with the requirements of the 1933 Act or the 1933 Act
Regulation, the Offerors will forthwith amend or
supplement the Prospectus in accordance with paragraph
(b) above so that, as so amended or supplemented, the
Prospectus will not include an untrue statement of a
material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of
the circumstances existing at the time it is delivered to
a purchaser, not misleading, and the Offerors will
furnish to the Underwriters a reasonable number of copies
of such amendment or supplement.
(f) The Offerors will endeavor, in
cooperation with the Underwriters, to qualify the
Preferred Securities and Subordinated Debt Securities for
offering and sale under the applicable securities laws of
such states and other jurisdictions of the United States
as the Representative may designate; provided, however,
that each of the Offerors shall not be obligated to
qualify as a foreign corporation in any jurisdiction in
which it is not so qualified.
(g) The Trust will make generally
available to its security holders as soon as practicable
but not later than 45 days after the close of the period
covered thereby, an earnings statement of the Company (in
form complying with the provisions of Rule 158 of the
1933 Act Regulations) covering a twelve-month period
beginning not later than the first day of the Trust's
fiscal quarter next following the "effective date" (as
defined in said Rule 158) of the Registration Statement.
(h) For a period of five years after the
Closing Time, the Company will furnish to you and, upon
request, to each Underwriter, copies of all annual
reports, quarterly reports and current reports filed with
the Commission on Forms 10-K, 10-Q and 8-K, or such other
similar forms as may be designated by the Commission, and
such other documents, reports and information as shall be
furnished by the Company to its stockholders or security
holders generally.
(i) The Offerors will use reasonable
efforts to effect the listing of the Preferred Securities
on the New York Stock Exchange; if the Preferred
Securities are exchanged for Subordinated Debt
Securities, the Company will use its reasonable efforts
to effect the listing of the Subordinated Debt Securities
on the exchange on which the Preferred Securities were
then listed.
(j) During a period of 30 days from the
date of the Pricing Agreement, neither the Trust nor the
Company will, without the Representative's prior written
consent, directly or indirectly, sell, offer to sell,
grant any option for the sale of, or otherwise dispose
of, any Preferred Securities, any security convertible
into or exchangeable into or exercisable for Preferred
Securities or any equity securities substantially similar
to the Preferred Securities (except for Preferred
Securities issued pursuant to this Agreement).
Section 4. Payment of Expenses. The Company
will pay all expenses incident to the performance of each
Offeror's obligations under this Agreement, including,
but not limited to, (i) the printing and filing of the
Registration Statement as originally filed and of each
amendment thereto, (ii) the printing of this Agreement
and the Pricing Agreement, (iii) the preparation,
issuance and delivery of the certificates for the
Preferred Securities to the Underwriters, (iv) the fees
and disbursements of the Company's and the Trust's
counsel and accountants, (v) the qualification of the
Preferred Securities and Subordinated Debt Securities
under securities laws in accordance with the provisions
of Section 3(f) hereof, including filing fees and the
fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the
preparation of any blue sky survey and any legal
investment survey, (vi) the printing and delivery to the
Underwriters of copies of the Registration Statement as
originally filed and of each amendment thereto, of each
preliminary prospectus, and of the Prospectus and any
amendments or supplements thereto, (vii) the printing and
delivery to the Underwriters of copies of any blue sky
survey and any legal investment survey, (viii) the fee of
the National Association of Securities Dealers, Inc. (ix)
the fees and expenses of the Debt Trustee, including the
fees and disbursements of counsel for the Debt Trustee in
connection with the Indenture and the Subordinated Debt
Securities; (x) the fees and expenses of the Property
Trustee, including the fees and disbursements of counsel
for the Property Trustee and Delaware Trustee in
connection with the Declaration and the Certificate of
Trust; (xi) any fees payable in connection with the
rating of the Preferred Securities and Subordinated Debt
Securities, (xii) the fees and expenses incurred in
connection with the listing of the Preferred Securities
and, if applicable, the Subordinated Debt Securities on
the New York Stock Exchange, and (xiii) the cost and
charges of any transfer agent or registrar and (xiv) the
cost of qualifying the Preferred Securities with The
Depository Trust Company.
If this Agreement is terminated by the
Representative in accordance with the provisions of
Section 5 or Section 9 hereof, the Company shall
reimburse the Underwriters for all of their reasonable
out-of-pocket expenses, including the reasonable fees and
disbursements of counsel for the Underwriters, which
shall not exceed the amount set forth in the applicable
Terms Agreement.
Section 5. Conditions of Underwriters'
Obligations. The obligations of the Underwriters
hereunder are subject to the accuracy of the
representations and warranties of the Offerors herein
contained, to the performance by the Offerors of their
obligations hereunder, and to the following further
conditions:
(a) The Registration Statement shall have
become effective not later than 5:30 P.M. on the date
hereof, or with the consent of the Representative, at a
later time and date, not later, however, than 5:30 P.M.
on the first business day following the date hereof, or
at such later time and date as may be approved by the
Representative; and at Closing Time no stop order
suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or
proceedings therefor initiated or threatened by the
Commission. The Prospectus shall have been filed with
the Commission pursuant to Rule 424(b) within the
applicable time period prescribed for such filing by the
1933 Regulations and in accordance with Section 3(b) and
prior to Closing Time the Offerors shall have provided
evidence satisfactory to the Representative of such
timely filing.
(b) At Closing Time the Representative
shall have received:
(1) The favorable opinion, dated as
of Closing Time, of Fleischman and Walsh, counsel for the
Offerors in form and substance satisfactory to counsel
for the Underwriters, to the effect that:
(i) The Company has been duly
incorporated and is validly existing and in good
standing under the laws of the State of Delaware
with corporate power and authority under such laws
to own, lease and operate its properties and conduct
its business as described in the Prospectus.
(ii) The Company is duly qualified
to transact business as a foreign corporation and is
in good standing in each other jurisdiction in which
it owns or leases property of a nature, or transacts
business of a type, that would make such
qualification necessary, except to the extent that
the failure to so qualify or be in good standing
would not have a material adverse effect on the
Company and its subsidiaries, considered as one
enterprise.
(iii) Each Subsidiary is a
corporation duly incorporated, validly existing and
in good standing under the laws of the jurisdiction
of its incorporation with corporate power and
authority under such laws to own, lease and operate
its properties and conduct its business.
(iv) Each Subsidiary is duly
qualified to transact business as a foreign
corporation and is in good standing in each other
jurisdiction in which it owns or leases property of
a nature, or transacts business of a type, that
would make such qualification necessary, except to
the extent that the failure to so qualify or be in
good standing would not have a material adverse
effect on the Company and its subsidiaries,
considered as one enterprise.
(v) All of the outstanding shares of
capital stock of the Company have been duly
authorized and validly issued and are fully paid and
non-assessable, and no holder thereof is or will be
subject to personal liability by reason of being
such a holder; and none of the outstanding shares of
capital stock of the Company was issued in violation
of the preemptive rights of any stockholder of the
Company.
(vi) All of the outstanding shares
of capital stock of each Subsidiary have been duly
authorized and validly issued and are fully paid and
non-assessable; all of such shares are owned by the
Company free and clear of any pledge, lien, security
interest, charge, claim, equity or encumbrance of
any kind; no holder thereof is subject to personal
liability by reason of being such a holder and none
of such shares was issued in violation of the
preemptive rights of any stockholders of the
Subsidiaries.
(vii) Such counsel does not know of
any statutes or regulations or any pending or
threatened legal or governmental proceedings,
required to be described in the Prospectus that are
not described as required, nor of any contracts or
documents of a character required to be described or
referred to in the Registration Statement or the
Prospectus or to be filed as exhibits to the
Registration Statement that are not described,
referred to or filed as required.
(viii) To the knowledge of such
counsel after due inquiry, no default exists in the
performance or observance of any material
obligation, agreement, covenant or condition
contained in any contract, indenture, loan
agreement, note, lease or other agreement or
instrument that is described or referred to in the
Registration Statement or the Prospectus or filed as
an exhibit to the Registration Statement.
(ix) The Trust has been duly created
and is validly existing in good standing as a
business trust under the Delaware Act; all filings
required under the laws of the State of Delaware
with respect to the formation and valid existence of
the Trust as a business trust have been made; the
Trust has all necessary power and authority to own
property and to conduct its business as described in
the Registration Statement and Prospectus and to
enter into and perform its obligations under this
Agreement, the Pricing Agreement, the Preferred
Securities and the Common Securities and is not
required to be authorized to do business in any
other jurisdiction; and the Trust is not a party to
or otherwise bound by any agreement other than those
described in the Prospectus.
(x) The Declaration has been duly
authorized, executed and delivered by the Company
and the Trustees and is a valid and binding
obligation of the Company enforceable against the
Company in accordance with their terms, except as
enforcement thereof may be limited by the Bankruptcy
Exceptions.
(xi) The Common Securities have been
duly authorized by the Declaration and are validly
issued and (subject to the terms of the Declaration)
fully paid and non-assessable beneficial interest in
the assets of the Trust; and the issuance of the
Common Securities is not subject to preemptive or
other similar rights.
(xii) The Preferred Securities have
been duly authorized by the Declaration and are
validly issued and (subject to the terms of the
Declaration) when delivered to and paid for by
Underwriters pursuant to this Agreement will be
validly issued, fully paid and non-assessable
beneficial interests in the assets of the Trust; the
holders of the Preferred Securities will be entitled
to the same limitation of personal liability
extended to stockholders of private corporations for
profit; and the issuance of the Preferred Securities
is not subject to preemptive or other similar
rights.
(xiii) The issuance and sale by the
Trust of the Preferred Securities and Common
Securities; the execution, delivery and performance
by the Trust of this Agreement, the Pricing
Agreement and the Guarantee Agreements; the
consummation of the transactions contemplated herein
and therein; and compliance by the Trust with its
obligations hereunder and thereunder have been duly
authorized by all necessary actions of the Trust and
will not conflict with or constitute a breach of, or
default under, or result in the creation or
imposition of any lien, charge or encumbrance upon
any property or assets of the Trust pursuant to, any
contract, indenture, mortgage, loan agreement, note,
lease or other instrument to which the Trust is a
party or by which it or any of them may be bound, or
to which any of the property or assets of the Trust
is subject, nor will such action result in any
violation of the provisions of the Certificate of
Trust or the Declaration, or any applicable law,
administrative regulation or administrative or court
decree to which it is subject.
(xiv) No authorization, approval,
consent or order of any court or governmental
authority or agency is required in connection with
the issuance and sale of the Common Securities or
the offering of the Preferred Securities, the
Subordinated Debt Securities or the Guarantees
except such as have been obtained and such as may be
required by state securities laws.
(xv) The statements in the
Prospectus under the captions "Investment
Considerations", "Description of the Preferred
Securities", "The Southern Union Financing Trusts,"
insofar as they constitute matters of law, summaries
of legal matters, documents or proceedings, or legal
conclusions, has been reviewed by them and are
correct in all material respects.
(xvi) The Trust is not in violation
of its Certificate of Trust or the Declaration or in
default in the performance or observance of any
material obligation, agreement, covenant or
condition contained in any contract, indenture,
mortgage, loan agreement, note, lease or any other
instrument of which the Trust is a party or by which
it may be bound, or to which any of the property or
assets of the Trust is subject.
(xvii) The Company is not a "holding
company" or an "affiliate" or "subsidiary company"
of a "registered holding company" within the meaning
of the Public Utility Holding Company Act of 1935,
as amended.
(xviii) The Company and the
Subsidiaries each owns, possesses or has obtained
all material licenses, franchises, permits,
certificates, consents, orders, approvals and other
authorizations issued by the appropriate local,
state, federal or foreign regulatory agencies or
bodies necessary both to own or lease, as the case
may be, and to operate its properties and to carry
on its business as described in the Registration
Statement, and such licenses, franchises, permits,
certificates, consents, orders, approvals and other
authorizations are in full force and effect.
(xix) The Registration Statement is
effective under the 1933 Act and, to the best of
their knowledge and information, no stop order
suspending the effectiveness of the Registration
Statement has been issued under the 1933 Act or
proceedings therefor initiated or threatened by the
Commission.
(xx) At the time the Registration
Statement became effective and at the Representation
Date, the Registration Statement (other than the
financial statements and supporting schedules
included therein, as to which no opinion need be
rendered) complied as to form in all material
respects with the requirements of the 1933 Act and
the 1933 Act Regulations.
(xxi) Each of the documents
incorporated by reference in the Registration
Statement or Prospectus at the time they were filed
or last amended (other than the financial statements
and related schedules and other financial or
statistical data included or incorporated by
reference therein as to which such counsel need
express no opinion), complied as to form in all
material respects with the requirements of the 1933
Act, the 1933 Act Regulations, the 1934 Act, the
1934 Act Regulations, as applicable, and such
counsel has no reason to believe that any of such
documents, when such documents became effective or
were so filed, as the case may be, contained, in the
case of a registration statement which became
effective under the 1933 Act, an untrue statement of
a material fact, or omitted to state a material fact
required to be stated therein or necessary to make
the statements therein not misleading, and, in the
case of other documents that were filed under the
1934 Act with the Commission, an untrue statement of
a material fact or omitted to state a material fact
necessary to make the statements therein not
misleading.
(xxii) Each of the Offerors meets
the registrant requirements for use of Form S-3
under the 1933 Act Regulations.
(xxiii) The statements in the
Prospectus under the captions "Investment
Considerations", "Description of the Preferred
Securities", "Description of the Preferred
Securities Guarantees", "Description of the
Subordinated Debt Securities", "Effect of
Obligations Under the Subordinated Debt Securities
and the Guarantee" and "Utility Regulation and
Rates" insofar as they constitute matters of law,
summaries of legal matters, documents or
proceedings, or legal conclusions, has been reviewed
by them and are correct in all material respects.
(xxiv) The Common Securities, the
Preferred Securities, the Subordinated Debt
Securities, each of the Guarantees, the Declaration,
the Indenture and the Guarantee Agreements conform
to all statements relating thereto contained in the
Prospectus.
(xxv) To the best of their knowledge
and information, there are no contracts, indentures,
mortgages, loan agreements, notes, leases or other
instruments required to be described or referred to
in the Registration Statement or to be filed as
exhibits thereto other than those described or
referred to therein or filed or incorporated by
reference as exhibits thereto; the descriptions
thereof or references thereto are correct; and no
default exists in the due performance or observance
of any material obligation, agreement, covenant or
condition contained in any contract, indenture,
mortgage, loan agreement, note, lease or other
instrument so described, referred to, or filed or
incorporated by reference.
(xxvi) All of the issued and
outstanding Common Securities of the Trust are
directly owned by the Company free and clear of any
security interest, mortgage, pledge, lien,
encumbrance, claim or equity.
(xxvii) This Agreement and the
Pricing Agreement have been duly authorized,
executed and delivered by the Trust and the Company.
(xxviii) The Declaration has been
duly qualified under the 1939 Act.
(xxix) Each of the Guarantee
Agreements has been duly authorized, executed and
delivered by the Company and, (in the case of the
Preferred Security Guarantee Agreement only)
assuming it is duly authorized, executed, and
delivered by the Property Trustee, constitutes a
valid and binding obligation of the Company,
enforceable against the Company in accordance with
its terms, except to the extent that enforcement
thereof may be limited by Bankruptcy Exceptions; and
the Preferred Securities Guarantee Agreement has
been duly qualified under the 1939 Act.
(xxx) The Indenture has been duly
executed and delivered by the Company and, assuming
due authorization, execution, and delivery thereof
by the Debt Trustee, is a valid and binding
obligation of the Company, enforceable in accordance
with its terms, except to the extent that
enforcement thereof may be limited by the Bankruptcy
Exceptions; and the Indenture has been duly
qualified under the 1939 Act.
(xxxi) The Subordinated Debt
Securities are in the form contemplated by the
Indenture; the Subordinated Debt Securities have
been duly authorized, executed and delivered by the
Company and when authenticated by the Trustee in the
manner provided in the Indenture and delivered
against payment therefor, will constitute valid and
binding obligations of the Company, enforceable
against the Company in accordance with their terms,
except to the extent that enforcement thereof may be
limited by the Bankruptcy Exceptions.
(xxxii) The Subordinated Debt
Securities are subordinated and junior in right of
payment to all senior indebtedness of the Company.
(xxxiii) The Company's obligations
under the Preferred Securities Guarantee and the
Common Securities Guarantee are subordinate and
junior in right of payment to all liabilities of the
Company and are pari passu with the most senior
preferred stock issued by the Company.
(xxxiv) None of the Offerors is an
"investment company" or a company "controlled" by an
"investment company" within the meaning of the 1940
Act.
(xxxv) The Declaration has been duly
authorized, executed and delivered by the Company
and each of the Regular Trustees and constitutes a
valid and binding obligation of the Company and each
of the Regular Trustees, enforceable against the
Company and each of the Regular Trustees in
accordance with its terms, except to the extent that
the enforcement thereof may be limited by the
Bankruptcy Exceptions.
(xxxvi) To the best of his knowledge
and information, there are no legal or governmental
proceedings pending or threatened which are required
to be disclosed in the Registration Statement or
Prospectus, other than those disclosed therein, and
all pending legal or governmental proceedings to
which the Company, any of its subsidiaries or the
Trust is a party or to which any of their property
is subject which are not described in the
Registration Statement or Prospectus, including
ordinary routine litigation incidental to the
business, are, considered in the aggregate, not
material.
(xxxvii) No authorization, approval,
consent or order of any court or governmental
authority or agency is required in connection with
the issuance and sale of the Common Securities or
the offering of the Preferred Securities, the
Subordinated Debt Securities or the Guarantees,
except such as may be required under the 1933 Act or
the 1933 Act Regulations or state securities law and
the qualification of the Declaration, the Preferred
Securities Guarantee Agreement and the Indenture
under the 1939 Act.
(xxxviii) The execution, delivery and
performance of this Agreement, the Pricing
Agreement, the Declaration, the Preferred
Securities, the Common Securities, the Indenture,
the Subordinated Debt Securities, the Guarantee
Agreements, the Indenture and the Guarantees and the
consummation of the transactions contemplated herein
and therein and compliance by the Offerors with
their respective obligations hereunder and
thereunder have been duly authorized by all
necessary action (corporate or otherwise) and do not
and will not result in any violation of the charter
or by-laws of the Company or any Subsidiary or the
Declaration or Certificate of Trust, and do not and
will not conflict with, or result in a breach of any
of the terms or provisions of, or constitute a
default under, or result in the creation or
imposition of any lien, charge or encumbrance upon
any property or assets of the Trust or the Company
or any Subsidiary under (A) any contract, indenture,
mortgage, loan agreement, note, lease or any other
agreement or instrument known to such counsel, to
which the Trust or the Company or any Subsidiary is
a party or by which it may be bound or to which any
of its properties may be subject (except for such
conflicts, breaches or defaults or liens, charges or
encumbrances that would not have a material adverse
effect on the condition (financial or otherwise),
earnings, business affairs or business prospects of
the Trust or the Company and its subsidiaries,
considered as one enterprise), (B) any existing
applicable law, rule or regulation (other than the
securities or blue sky laws of the various states,
as to which such counsel need express no opinion),
or (C) any judgment, order or decree of any
government, governmental instrumentality or court,
domestic or foreign, or any regulatory body or
administrative agency or other governmental body
having jurisdiction over the Trust, the Company or
any Subsidiary or any of their respective
properties.
(xxxix) In addition, such counsel
shall state that it has participated in conferences
with officers and other representatives of the
Offerors, representatives of the independent public
accountants for the Offerors and with you and your
counsel, at which conferences the contents of the
Registration Statement and the Prospectus and
related matters were discussed; such counsel has not
independently verified the accuracy, completeness or
fairness of the statements contained in the
Registration Statement or the Prospectus and the
limitations inherent in the examination made by such
counsel and the nature and extent of such counsel's
participation in such conferences are such that such
counsel is not passing upon, and is unable to
assume, and does not assume, any responsibility for,
the accuracy, completeness or fairness of such
statements, except for those made under the captions
"Description of the Preferred Securities",
"Description of the Preferred Securities
Guarantees", "Description of the Subordinated Debt
Securities"; however, based upon such counsel's
participation in the aforesaid conferences, no facts
have come to its attention which lead it to believe
that the Registration Statement, and each amendment
thereto, at the time it became effective, or if an
annual report on Form 10-K has been filed by the
Company with the Commission subsequent to the time
of effectiveness of the Registration Statement and
the Prospectus and any further amendments and
supplements thereto made by the Offerors prior to
the Closing Time (other than the financial
statements and the notes thereto, the financial
statements schedules, the other financial and
statistics data therein, as to which such counsel
need express no belief) and those parts of the
Registration Statement that constitute the Debt
Trustee's, the Property Trustee's and the Guarantee
Trustee's respective Statements of Eligibility and
Qualification under the 1939 Act (form T-1)
contained any untrue statements of a material fact
or omitted to state a material fact required to be
stated therein or necessary to make the statements
therein not misleading or that, as of its date, the
Prospectus or any further amendments or supplement
or supplement thereto made by the Company prior to
the Closing Time (except as aforesaid) includes any
untrue statement of a material fact or omits to
state a material fact necessary to make the
statements therein, in the light of the
circumstances under which they were made, not
misleading or that, as of such Closing Time, either
the Prospectus or any further amendment or
supplement thereto made by the Company prior to such
Closing Time (except as aforesaid) includes any
untrue statement of a material fact or omits to
state a material fact necessary to make the
statements therein, in light of the circumstances
under which they were made, not misleading.
(2) The favorable opinion, dated as
of Closing Time, of Richard, Layton & Finger, counsel of
Wilmington Trust Company, as Property Trustee under the
Declaration, and Guarantee Trustee under the Guarantee
Agreements, in form and substance satisfactory to counsel
for the Underwriters, to the effect that,
(i) Wilmington Trust Company is an
Delaware banking corporation with trust powers, duly
organized, validly existing and in good standing
under the laws of the State of Delaware with all
necessary power and authority to execute and
deliver, and to carry out and perform its
obligations under the terms of the Declaration and
the Guarantee Agreements.
(ii) The execution, delivery and
performance by the Property Trustee of the
Declaration and the Guarantee Agreements have been
duly authorized by all necessary corporate action on
the part of the Property Trustee. The Declaration
and the Guarantee Agreements have been duly executed
and delivered by the Property Trustee, and
constitutes the legal, valid and binding obligation
of the Property Trustee, enforceable against the
Property Trustee in accordance with their terms,
except as enforcement thereof may be limited by the
Bankruptcy Exceptions.
(iii) The execution, delivery and
performance of the Declaration and the Guarantee
Agreements by the Property Trustee does not conflict
with or constitute a breach of the Articles of
Organization or Bylaws of the Property Trustee.
(iv) No consent, approval or
authorization of, or registration with or notice to,
any Delaware or federal banking authority is
required for the execution, delivery or performance
by the Property Trustee of the Declaration and the
Guarantee Agreements.
(v) The Property Trustee is the
record holder of the Subordinated Debt Securities
and the Guarantees and no security interest,
mortgage, pledge, lien, encumbrance, claim or equity
is noted thereon or on the register.
(3) The favorable opinion, dated as of
Closing Time, of Skadden, Arps, Slate, Meagher & Flom
("SASM&F"), counsel for the Underwriters, in form and
substance satisfactory to the Underwriters with respect
to the legal existence of the Trust, the Designated
Securities, the Indenture, the Preferred Securities
Guarantee Agreement, this Agreement, the Pricing
Agreement, the Registration Statement, the Prospectus,
certain U.S. Federal Income Tax matters and other related
matters as the Representative may require.
In giving its opinion, SASM&F may rely as to
certain matters of Delaware law upon the opinion of
Fleishman and Walsh, counsel for the Offerors, which
shall be delivered in accordance with Section 5(b)1
hereto,
(c) At Closing Time, there shall not have
been, since the date hereof or since the respective dates
as of which information is given in the Registration
Statement and the Prospectus, any material adverse change
in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the
Trust or the Company and its subsidiaries considered as
one enterprise, whether or not arising in the ordinary
course of business, and the Representative shall have
received a certificate of a Vice President of the Company
and of the chief financial or chief accounting officer of
the Company and a certificate of the Trustees of the
Trust, and dated as of Closing Time, to the effect that
(i) there has been no such material adverse change, (ii)
the representations and warranties in Section 1 hereof
are true and correct with the same force and effect as
though expressly made at and as of Closing Time, (iii)
the Trust and the Company have complied with all
agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to Closing Time, and
(iv) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings
for that purpose have been initiated or threatened by the
Commission.
(d) At the time of the execution of this
Agreement, the Representative shall have received from
Coopers & Lybrand L.L.P. a letter dated such date, in
form and substance satisfactory to the Representative, to
the effect that:
(i) they are independent public
accountants with respect to the Company and its
consolidated subsidiaries, within the meaning of the
1933 Act and the 1933 Act Regulations; and the Trust
is and will be treated as a consolidated subsidiary
of the Company pursuant to generally accepted
accounting principles;
(ii) in their opinion, the
consolidated financial statements and any
supplementary financial information and schedules
audited (and, if applicable, prospective financial
statements and/or pro forma financial information
examined) by them and included or incorporated by
reference in the Registration Statement or the
Prospectus comply as to form in all material
respects with the applicable accounting requirements
of the 1933 Act or the Exchange Act and the related
published rules and regulations thereunder; and if
applicable, they have made a review in accordance
with standards established by the American Institute
of Certified Public Accountants of the consolidated
interim financial statements, selected financial
data, statements and/or condensed financial
statements derived from audited financial statements
of the Company for the periods specified in such
letter, as indicated in their reports thereon,
copies of which have been furnished to the
Representatives;
(iii) based upon limited procedures
set forth in detail in such letter, nothing has come
to their attention which causes them to believe that
(A) the unaudited consolidated
financial statements and supporting schedules of the
Company included in the Registration Statement do
not comply as to form in all material respects with
the applicable accounting requirements of the 1933
Act and the 1933 Act Regulations or are not
presented in conformity with generally accepted
accounting principles applied on a basis
substantially consistent with that of the audited
financial statements included in the Registration
Statement,
(B) the unaudited amounts of
revenues, net income and net income per share set
forth under Summary Financial Information" in the
Prospectus were not determined on a basis
substantially consistent with that used in
determining the corresponding amounts in the audited
financial statements included in the Registration
Statement, or
(C) at a specified date not more
than five days prior to the date of this Agreement,
there has been any change in the capital stock, the
Company and its subsidiaries or any increase in the
consolidated long-term debt of the Company and its
subsidiaries or any decrease in consolidated net
current assets or net assets as compared with the
amounts shown on the date of the most recent
consolidated balance sheet included in or
incorporated by reference in the Registration
Statement and the Prospectus (March 31, 1995 balance
sheet included in the Registration Statement) or,
during the period from the date of the most recent
consolidated balance sheet included in or
incorporated by reference in the Registration
Statement and the Prospectus to a specified date not
more than five days prior to the date of this
Agreement, there were any decreases, as compared
with the corresponding period in the preceding year,
in consolidated revenues, net income or net income
per share of the Company and its subsidiaries,
except in all instances for changes, increases or
decreases which the Registration Statement and the
Prospectus disclose have occurred or may occur; and
(iv) in addition to the examination
referred to in their opinions and the limited
procedures referred to in clause (iii) above, they
have carried out certain specified procedures, not
constituting an audit, with respect to certain
amounts, percentages and financial information which
are included in the Registration Statement and
Prospectus, or incorporated therein by reference,
and which are specified by the Representative, and
have found such amounts, percentages and financial
information to be in agreement with the relevant
accounting, financial and other records of the
Company and its subsidiaries identified in such
letter.
(e) At Closing Time, the Representative
shall have received from Coopers & Lybrand L.L.P. a
letter, dated as of Closing Time, to the effect that they
reaffirm the statements made in the letter furnished
pursuant to subsection (d) of this Section, except that
the specified date referred to shall be a date not more
than five days prior to Closing Time.
(f) At Closing Time and each Date of
Delivery, if any, counsel for the Underwriters shall have
been furnished with such documents and opinions as they
may require for the purpose of enabling them to pass upon
the issuance and sale of the Preferred Securities as
herein contemplated and related proceedings, or in order
to evidence the accuracy of any of the representations or
warranties, or the fulfillment of any of the conditions,
herein contained; and all proceedings taken by the
Offeror, in connection with the issuance and sale of the
Preferred Securities as herein contemplated shall be
satisfactory in form and substance to the Representative
and counsel for the Underwriters.
(g) In the event that the Underwriters
exercise their option provided in Section 2(b) hereof to
purchase all or any portion of the Option Securities, the
representations and warranties of the Offerors contained
herein and the statements in any certificates furnished
by the Offerors hereunder shall be true and correct as of
each Date of Delivery and, at the relevant Date of
Delivery, the Representative shall have received:
(1) The certificates, each dated such Date of
Delivery, of the relevant officer of the respective
Offeror confirming that the respective certificates
delivered at the Closing Time pursuant to Section
5(c) hereof remains true and correct as of such Date
of Delivery.
(2) The favorable opinion of Fleischman and Walsh,
counsel for the Offerors, in form and substance
satisfactory to counsel for the Underwriters, dated
such Date of Delivery, relating to the Option
Securities to be purchased on such Date of Delivery
and otherwise to the same effect as the opinion
required by Sections 5(b)(l).
(3) The favorable opinion of Richards, Layton &
Finger, counsel to Wilmington Trust Company for the
Offerors, in form and substance satisfactory to
counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Securities to be
purchased on such Date of Delivery and otherwise to
the same effect as the opinion required by Sections
5(b)(2).
(4) The favorable opinion of Skadden, Arps, Slate,
Meagher & Flom, counsel for Underwriters, dated such
Date of Delivery, relating to the Option Securities
to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion required
by Sections 5(b)(3).
(5) A letter from Coopers & Lybrand L.L.P., in form
and substance satisfactory to the Representative and
dated such Date of Delivery, substantially the same
in form and substance as the letter furnished to the
Representative pursuant to Section 5(d) hereof,
except that the "specified date" in the letter
furnished pursuant to this Section 5(g)(4) shall be
a date not more than five days prior to such Date of
Delivery.
(h) At Closing Time, the Preferred
Securities and the Subordinated Debt Securities shall be
rated in one of the four highest rating categories for
long term debt ("Investment Grade") by any nationally
recognized statistical rating agency, and the Trust shall
have delivered to the Representative a letter, dated the
Closing Time, from such nationally recognized statistical
rating agency, or other evidence satisfactory to the
Representative, confirming that the Preferred Securities
and the Subordinated Debt Securities have Investment
Grade ratings.
(i) At the Closing Time, the Preferred
Securities shall have been approved for listing on the
New York Stock Exchange upon notice of issuance.
If any condition specified in this Section
shall not have been fulfilled when and as required to be
fulfilled, this Agreement may be terminated by the
Representative by notice to the Offerors at any time at
or prior to Closing Time, and such termination shall be
without liability of any party to any other party except
as provided in Section 4 hereof.
Section 6. Indemnification
(a) The Offerors agree to jointly and
severally indemnify and hold harmless each Underwriter
and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the 1933 Act as
follows:
(i) against any and all loss,
liability, claim, damage and expense
whatsoever, as incurred, arising out of any
untrue statement or alleged untrue statement of
a material fact contained in the Registration
Statement (or any amendment thereto), including
the information deemed to be part of the
Registration Statement pursuant to Rule 430A(b)
of the 1933 Act Regulations, if applicable, or
the omission or alleged omission therefrom of a
material fact required to be stated therein or
necessary to make the statements therein not
misleading or arising out of any untrue
statement or alleged untrue statement of a
material fact contained in any preliminary
prospectus or the Prospectus (or any amendment
or supplement thereto) or the omission or
alleged omission therefrom of a material fact
necessary in order to make the statements
therein, in the light of the circumstances
under which they were made, not misleading;
(ii) against any and all loss,
liability, claim, damage and expense
whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any
litigation, or any investigation or proceeding
by any govern-mental agency or body, commenced
or threatened, or of any claim whatsoever based
upon any such untrue statement or omission, or
any such alleged untrue statement or omission,
if such settlement is effected with the written
consent of the Company; and
(iii) against any and all
expense whatsoever as incurred (including,
subject to Section 6(c) hereof, the fees and
disbursements of counsel chosen by Merrill
Lynch) reasonably incurred, in investigating,
preparing or defending against any litigation,
or any investigation or proceeding by any
governmental agency or body, commenced or
threatened, or any claim whatsoever based upon
any such untrue statement or omission, to the
extent that any such expense is not paid under
(i) or (ii) above;
provided, however, that this indemnity agreement shall
not apply to any loss, liability, claim, damage or
expense to the extent arising out of any untrue statement
or omission or alleged untrue statement or omission made
in reliance upon and in conformity with written
information furnished to the Trust or the Company by any
Underwriter through Merrill Lynch expressly for use in
the Registration Statement (or any amendment thereto) or
any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto); and provided, further,
that this indemnity agreement with respect to any
preliminary prospectus shall not inure to the benefit of
any underwriter from whom the person asserting any such
losses, liabilities, claims, damages or expenses
purchased Securities, or any person controlling such
Underwriter, if the Offerors sustain the burden that a
copy of the Prospectus (as then amended or supplemented
if the Company or the Trust shall have furnished any such
amendments or supplements thereto), but excluding
documents incorporated or deemed to be incorporated by
reference, was not sent or given by or on behalf of such
Underwriter to such person, if such is required by law,
at or prior to the written confirmation of the sale of
such Securities to such person and if the Prospectus (as
so amended or supplemented, but excluding documents
incorporated or deemed to be incorporated by reference
therein) would have corrected the defect giving rise to
such loss, liability, claim, damage or expense, it being
understood that this proviso shall have no application if
such defect shall have been corrected in a document which
is incorporated or deemed to be incorporated by reference
in the Prospectus.
(b) The Company agree jointly and
severally to indemnify the Trust against all loss,
liability, claim, damage and expense whatsoever, as due
from the Trust under Section 6(a) hereunder.
(c) Each Underwriter severally agrees to
indemnify and hold harmless the Offerors, their
directors, trustees, each of its officers who signed the
Registration Statement, and each person, if any, who
controls the Offerors within the meaning of Section 15 of
the 1933 Act against any and all loss, liability, claim,
damage and expense described in the indemnity contained
in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions, or
alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto) or any
preliminary prospectus or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the
Offerors by such Underwriter through Merrill Lynch
expressly for use in the Registration Statement (or any
amendment thereto) or such preliminary prospectus or the
Prospectus (or any amendment or supplement thereto).
(d) Each indemnified party shall give
notice as promptly as reasonably practicable to each
indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but
failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability which
it may have otherwise than on account of this indemnity
agreement. An indemnifying party may participate at its
own expense in the defense of any such action. In no
event shall the indemnifying parties be liable for fees
and expenses of more than one counsel (in addition to any
local counsel) separate from their own counsel for all
indemnified parties in connection with any one action or
separate but similar or related actions in the same
jurisdiction arising out of the same general allegations
or circumstances.
Section 7. Contribution. In order to provide
for just and equitable contribution in circumstances in
which the indemnity agreement provided for in Section 6
hereof is for any reason held to be unenforceable by the
indemnified parties although applicable in accordance
with its terms, the Offerors and the Underwriters shall
contribute to the aggregate losses, liabilities, claims,
damages and expenses of the nature contemplated by said
indemnity agreement incurred by the Offerors and one or
more of the Underwriters, as incurred, in such
proportions that the Underwriters are responsible for
that portion represented by the percentage that the
underwriting compensation paid by the Company appearing
on the cover page of the Prospectus bears to the initial
public offering price appearing thereon and the Offerors
are responsible for the balance; provided, however, that
no person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the 1933 Act) shall be
entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For
purposes of this Section, each person, if any, who
controls an Underwriter within the meaning of Section 15
of the 1933 Act shall have the same rights to
contribution as such Underwriter, and each director of
the Company and each officer of the Company who signed
the Registration Statement, each trustee of the Trust and
each person, if any, who controls an Offeror within the
meaning of Section 15 of the 1933 Act shall have the same
rights to contribution as the Offerors.
Section 8. Representations, Warranties and
Agreements to Survive Delivery. All representations,
warranties and agreements contained in this Agreement and
the Pricing Agreement, or contained in certificates of
officers or Trustees of the Offerors submitted pursuant
hereto, shall remain operative and in full force and
effect, regardless of any investigation made by or on
behalf of any Underwriter or controlling person, or by or
on behalf of the Offerors and shall survive delivery of
the Preferred Securities to the Underwriters.
Section 9. Termination of Agreement.
(a) The Representative may terminate this
Agreement, by notice to the Offerors, at any time at or
prior to Closing Time (i) if there has been, since the
date of this Agreement or since the respective dates as
of which information is given in the Registration
Statement, any material adverse change in the condition
financial or otherwise, or in the earnings, business
affairs or business prospects or the Trust or the Company
and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of
business, or (ii) if there has occurred any material
adverse change in the financial markets in the United
States or elsewhere or any outbreak of hostilities or
escalation thereof or other calamity or crisis the effect
of which is such as to make it, in the judgment of the
Representative, impracticable to market the Designated
Securities or to enforce contracts for the sale of the
Designated Securities, (iii) if trading in the Designated
Securities has been suspended by the Commission, or if
trading generally on the New York Stock Exchange has been
suspended, limited or restricted or minimum or maximum
prices for trading have been fixed, or maximum ranges for
prices for securities have been required, by said
exchange or by order of the Commission or any other
governmental authority, or if a banking moratorium has
been declared by either Federal, New York, Delaware or
Texas authorities or (iv) if there has been any decrease
in the ratings of any of the debt securities of the
Company or of the Preferred Securities by any "nationally
recognized statistical rating organization" (as defined
for purposes of Rule 436(g) under the Act) and such
organization shall have publicly announced that it has
under surveillance or review, with possible negative
implications, its rating of any of the debt securities of
the Company or of the Preferred Securities.
(b) If this Agreement is terminated
pursuant to this Section, such termination shall be
without liability of any party to any other party except
as provided in Section 4 hereof.
Section 10. Default by One or More of the
Underwriters. If one or more of the Underwriters shall
fail at Closing Time to purchase the Initial Securities
that it or they are obligated to purchase under this
Agreement and the Pricing Agreement (the "Defaulted
Securities'), the Representative shall have the right,
within 24 hours thereafter, to make arrangements for one
or more of the non-defaulting Underwriters, or any other
underwriters, to purchase all, but not less than all, of
the Defaulted Securities in such amounts as may be agreed
upon and upon the terms herein set forth; if, however,
the Representatives shall not have completed such
arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities
does not exceed 10% of the number of Initial
Securities, each of the non-defaulting Underwriters
shall be obligated, severally and not jointly, to
purchase the full amount thereof in the proportions
that their respective underwriting obligations
hereunder bear to the underwriting obligations of
all non-defaulting Underwriters, or
(b) if the number of Defaulted
Securities exceeds 10% of the number of Initial
Securities, this Agreement shall terminate without
liability on the part of any non-defaulting
Underwriter.
No action taken pursuant to this Section shall
relieve any defaulting Underwriter from liability in
respect of its default.
In the event of any such default which does not
result in a termination of this Agreement, either the
Representative, or the Offerors shall have the right to
postpone Closing Time for a period not exceeding seven
days in order to effect any required changes in the
Registration Statement or Prospectus or in any other
documents or arrangements.
Section 11. Notices. All notices and other
communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed or transmitted
by any standard form of telecommunication. Notices to
the Underwriters shall be directed to the Representative
at Merrill Lynch World Headquarters, North Tower, World
Financial Center, New York, New York 10281-1201,
attention of Robin Mass, Vice President; notices to the
Trust, and the Company shall be directed to them at 504
Lavaca, Suite 800, Austin TX, 78701, attention of David
Kvapil, Vice President and Controller.
Section 12. Parties. This Agreement and the
Pricing Agreement shall each inure to the benefit of and
be binding upon the Underwriters and the Trust, the
Company and their respective successors. Nothing
expressed or mentioned in this Agreement or the Pricing
Agreement is intended or shall be construed to give any
person, firm or corporation, other than the Underwriters
and the Trust and the Company and their respective
successors and the controlling persons and officers,
directors and trustees referred to in Sections 6 and 7
and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of
this Agreement or the Pricing Agreement or any provision
herein or therein contained. This Agreement and the
Pricing Agreement and all conditions and provisions
hereof and thereof are intended to be for the sole and
exclusive benefit of the Underwriters and the Trust and
the Company and their respective successors, and said
controlling persons and officers, directors and trustees
and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No
purchaser of Securities from any Underwriter shall be
deemed to be a successor by reason merely of such
purchase.
Section 13. Governing Law and Time. This
Agreement and the Pricing Agreement shall be governed by
and construed in accordance with the laws of the State of
New York applicable to agreements made and to be
performed in said State. Except as otherwise set forth
herein, specified times of day refer to New York City
time.
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to
the Trust a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a
binding agreement between the Underwriters and the Trust
and the Company in accordance with its terms.
Very truly yours,
SOUTHERN UNION COMPANY
By
__________________________
Title:
SOUTHERN UNION FINANCING I
By
__________________________
Title: Trustee
By
__________________________
Title: Trustee
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By ________________________________
Authorized Signatory
For itself and as Representative of the other
Underwriters named in Schedule A hereto.
SCHEDULE A
Number
Name of Underwriter of Securities
Merrill Lynch, Pierce, Fenner & Smith
Incorporated . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . .
EXHIBIT A
_______ Preferred Securities
SOUTHERN UNION FINANCING I
(a Delaware business trust)
____% Trust Originated Preferred Securities ("TOPrS")
(Liquidation Amount of $25 Per Security)
PRICING AGREEMENT
MERRILL LYNCH & CO. May __, 1995
Merrill Lynch, Pierce, Fenner
& Smith Incorporated
as Representative of the several
Underwriters named in the within-
mentioned Purchase Agreement
Merrill Lynch World Headquarters
North Tower
World Financial Center
New York, New York 10281
Dear Sirs:
Reference is made to the Underwriting
Agreement, dated May __, 1995 (the "Underwriting
Agreement"), relating to the purchase by the several
Underwriters named in Schedule A thereto, for whom
Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner &
Smith Incorporated is acting as representative (the
"Representative"), of the above ____% Trust Originated
Preferred Securities (the "Preferred Securities"), of
SOUTHERN UNION FINANCING I, a Delaware business trust
(the "Trust").
Pursuant to Section 2 of the Underwriting
Agreement, the Trust, Southern Union Company (the
"Company"), a Delaware corporation, agree with each
Underwriter as follows:
1. The initial public offering price per
security for the Preferred Securities, determined as
provided in said Section 2, shall be $25.00.
2. The purchase price per security for
the Preferred Securities to be paid by the several
Underwriters shall be $25.00, being an amount equal
to the initial public offering price set forth
above; provided that the purchase price per
Preferred Security for any Option Securities (as
defined in the Purchase Agreement) purchased upon
exercise of the over-allotment option described in
Section 2(b) of the Purchase Agreement shall be
reduced by an amount per share equal to any
distribution declared by the Trust and payable on
the Initial Securities (as defined in the Purchase
Agreement) but not payable on the Option Securities.
3. The compensation per Preferred
Security to be paid by the Company to the several
Underwriters in respect of their commitments
hereunder shall be $_____; provided, however, that
the compensation per Preferred Security for sales of
10,000 or more Preferred Securities to a single
purchaser shall be $_____.
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to
the Trust a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a
binding agreement between the Underwriters and the Trust
and the Company in accordance with its terms.
Very truly yours,
SOUTHERN UNION COMPANY
By
___________________________
Title:
SOUTHERN UNION FINANCING I
By
___________________________
Title: Trustee
By
___________________________
Title: Trustee
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By________________________________
Authorized Signatory
For itself and as Representative of the other
Underwriters named in the Underwriting Agreement.
<PAGE>
EXHIBIT 4-D
AMENDED AND RESTATED DECLARATION OF TRUST
<PAGE>
=========================================
AMENDED AND RESTATED DECLARATION
OF TRUST
SOUTHERN UNION FINANCING I
Dated as of __________, 1995
=========================================
<PAGE>
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
SOUTHERN UNION FINANCING I
_______________, 1995
AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration")
dated and effective as of ____________, 1995, by the undersigned
trustees (together with all other Persons from time to time duly
appointed and serving as trustees in accordance with the provi-
sions of this Declaration, the "Trustees"), Southern Union
Company, a Delaware Corporation, as trust sponsor (the "Spon-
sor"), and by the holders, from time to time, of undivided
beneficial interests in the Trust to be issued pursuant to this
Declaration;
WHEREAS, the Trustees and the Sponsor established a trust (the
"Trust") under the Delaware Business Trust Act pursuant to a
Declaration of Trust dated as of March 28, 1995, (the "Original
Declaration") and a Certificate of Trust filed with the Secretary
of State of Delaware on March 28, 1995, for the sole purpose of
issuing and selling certain securities representing undivided
beneficial interests in the assets of the Trust and investing the
proceeds thereof in certain Debentures of the Debenture Issuer;
WHEREAS, as of the date hereof, no interests in the Trust have
been issued;
WHEREAS, all of the Trustees and the Sponsor, by this Declara-
tion, amend and restate each and every term and provision of the
Original Declaration; and
NOW, THEREFORE, it being the intention of the parties hereto to
continue the Trust as a business trust under the Business Trust
Act and that this Declaration constitute the governing instrument
of such business trust, the Trustees declare that all assets con-
tributed to the Trust will be held in trust for the benefit of
the holders, from time to time, of the securities representing
undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions.
(a) Capitalized terms used in this Declaration but not
defined in the preamble above have the respective
meanings assigned to them in this Section 1.1;
(b) a term defined anywhere in this Declaration has the
same meaning throughout;
(c) all references to "the Declaration" or "this Declara-
tion" are to this Declaration as modified, supplemented
or amended from time to time;
(d) all references in this Declaration to Articles and Sec-
tions and Exhibits are to Articles and Sections of and
Exhibits to this Declaration unless otherwise speci-
fied;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Declaration unless otherwise
defined in this Declaration or unless the context
otherwise requires; and
(f) a reference to the singular includes the plural and
vice versa.
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act or any successor rule thereunder.
"Appointment Event" means an event defined in the terms of the
Preferred Securities, as set forth in Exhibit A, which entitles
the Holders of a Majority in liquidation amount of the Preferred
Securities to appoint a Special Regular Trustee.
"Authorized Officer" of a Person means any Person that is autho-
rized to bind such Person.
"Book Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained
and made through book entries by a Clearing Agency as described
in Section 9.4.
"Business Day" means any day other than a day on which banking
institutions in New York, New York are authorized or required by
law to close.
"Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. Code Section 3801 et seq., as it may be amended
from time to time.
"Certificate" means a Common Security Certificate or a Preferred
Security Certificate.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is
acting as depositary for the Preferred Securities and in whose
name or in the name of a nominee of that organization shall be
registered a Global Certificate and which shall undertake to
effect book entry transfers and pledges of the Preferred Securi-
ties.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time
the Clearing Agency effects book entry transfers and pledges of
securities deposited with the Clearing Agency.
"Closing Date" means ______________, 1995.
"Code" means the Internal Revenue Code of 1986 as amended.
"Commission" means the Securities and Exchange Commission.
"Common Security" has the meaning specified in Section 7.1.
"Common Securities Guarantee" means the guarantee agreement to be
dated as of _______________, 1995, of the Sponsor in respect of the
Common Securities.
"Common Security Certificate" means a definitive certificate in
fully registered form representing a Common Security substan-
tially in the form of Annex II to Exhibit A.
"Covered Person" means: (a) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the
Trust or (ii) the Trust's Affiliates; and (b) any Holder of
Securities.
"Debenture Issuer" means the Sponsor in its capacity as issuer of
the Debentures.
"Debenture Trustee" means The Chase Manhattan Bank, N.A., as
trustee under the Indenture until a successor is appointed
thereunder, and thereafter means such successor trustee.
"Debentures" means the series of Debentures to be issued by the
Debenture Issuer under the Indenture to be held by the Property
Trustee, a specimen certificate for such series of Debentures being
Exhibit B.
"Delaware Trustee" has the meaning set forth in Section 5.2.
"Definitive Preferred Security Certificates" has the meaning set
forth in Section 9.4.
"Direction" by a Person means a written direction signed:
(a) if the Person is a natural person, by that Person; or
(b) in any other case, in the name of such Person by one or
more Authorized Officers of that Person.
"Distribution" means a distribution payable to Holders of Securi-
ties in accordance with Section 6.1.
"DTC" means the Depository Trust Company, the initial Clearing
Agency.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor legislation.
"Event of Default" in respect of the Securities means an Event of
Default (as defined in the Indenture) has occurred and is con-
tinuing in respect of the Debentures.
"Holder" means a Person in whose name a Certificate representing
a Security is registered, such Person being a beneficial owner
within the meaning of the Business Trust Act.
"Indemnified Person" means (a) any Trustee; (b) any Affiliate of
any Trustee; (c) any officers, directors, shareholders, members,
partners, employees, representatives or agents of any Trustee; or
(d) any employee or agent of the Trust or its Affiliates.
"Indenture" means the Indenture dated as of ______________, 1995,
among the Debenture Issuer and The Chase Manhattan Bank, N.A., as
trustee, and any indenture supplemental thereto pursuant to which
the Debentures are to be issued.
"Investment Company" means an investment company as defined in
the Investment Company Act.
"Investment Company Act" means the Investment Company Act of
1940, as amended from time to time, or any successor legislation.
"Legal Action" has the meaning set forth in Section 3.6(g).
"Ministerial Action" has the meaning set forth in the terms of
the Securities as set forth in Exhibit A.
"Majority in liquidation amount of the Securities" means, except as
provided in the terms of the Preferred Securities and the Trust
Indenture Act, Holder(s) of outstanding Securities voting together
as a single class or, as the context may require, Holders of
outstanding Preferred Securities or Holders of outstanding Common
Securities voting separately as a class, who are the record owners
of more than 50% of the aggregate liquidation amount (including the
stated amount that would be paid on redemption, liquidation or
otherwise, plus accrued and unpaid Distributions to the date upon
which the voting percentages are determined) of all outstanding
Securities of the relevant class.
"Officers' Certificate" means, with respect to any Person, a cer-
tificate signed by two Authorized Officers of such Person. Any
Officers' Certificate delivered with respect to compliance with a
condition or covenant provided for in this Declaration shall
include:
(a) a statement that each officer signing the Certificate
has read the covenant or condition and the definition
relating thereto;
(b) a brief statement of the nature and scope of the exami-
nation or investigation undertaken by each officer in
rendering the Certificate;
(c) a statement that each such officer has made such
examination or investigation as, in such officer's
opinion, is necessary to enable such officer to express
an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied
with.
"Paying Agent" has the meaning specified in Section 3.8(h).
"Person" means a legal person, including any individual, corpora-
tion, estate, partnership, joint venture, association, joint
stock company, limited liability company, trust, unincorporated
association, or government or any agency or political subdivision
thereof, or any other entity of whatever nature.
"Preferred Securities Guarantee" means the guarantee agreement to
be dated as of _____________, 1995, of the Sponsor in respect of
the Preferred Securities.
"Preferred Security" has the meaning specified in Section 7.1.
"Preferred Security Beneficial Owner" means, with respect to a
Book Entry Interest, a Person who is the beneficial owner of such
Book Entry Interest, as reflected on the books of the Clearing
Agency, or on the books of a Person maintaining an account with
such Clearing Agency (directly as a Clearing Agency Participant
or as an indirect participant, in each case in accordance with
the rules of such Clearing Agency).
"Preferred Security Certificate" means a certificate representing
a Preferred Security substantially in the form of Annex I to
Exhibit A.
"Pricing Agreement" means the pricing agreement between the
Trust, the Debenture Issuer, and the underwriters designated by
the Regular Trustees with respect to the offer and sale of the
Preferred Securities.
"Property Trustee" means the Trustee meeting the eligibility
requirements set forth in Section 5.3.
"Property Trustee Account" has the meaning set forth in Section
3.8(c).
"Quorum" means a majority of the Regular Trustees or, if there
are only two Regular Trustees, both of them.
"Regular Trustee" means any Trustee other than the Property
Trustee and the Delaware Trustee.
"Related Party" means, with respect to the Sponsor, any direct or
indirect wholly owned subsidiary of the Sponsor or any other
Person that owns, directly or indirectly, 100% of the outstanding
voting securities of the Sponsor.
"Responsible Officer" means, with respect to the Property
Trustee, any vice-president, any assistant vice-president, the
secretary, any assistant secretary, the treasurer, any assistant
treasurer, any trust officer or assistant trust officer or any
other officer in the Corporate Trust Department of the Property
Trustee customarily performing functions similar to those per-
formed by any of the above designated officers and also means,
with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of that officer's
knowledge of and familiarity with the particular subject.
"Rule 3a-7" means Rule 3a-7 under the Investment Company Act.
"Securities" means the Common Securities and the Preferred
Securities.
"Securities Act" means the Securities Act of 1933, as amended.
"66-2/3% in liquidation amount of the Securities" means, except
as provided in the terms of the Preferred Securities and by the
Trust Indenture Act, Holders of outstanding Securities voting
together as a single class or, as the context may require, Holders
of outstanding Preferred Securities or Holder(s) of outstanding
Common Securities voting separately as a class, representing at
least 66 2/3% of the aggregate liquidation amount (including
the stated amount that would be paid on redemption, liquidation or
otherwise, plus accrued and unpaid Distributions, to the date upon
which the voting percentages are determined) of all outstanding
Securities of the relevant class.
"Special Regular Trustee" means a Regular Trustee appointed by
the Holders of a Majority in liquidation amount of the Preferred
Securities in accordance with Section 5.6(a)(ii)(B).
"Sponsor" means Southern Union Company, a Delaware corporation,
or any successor entity in a merger, consolidation or amalgam-
ation, in its capacity as sponsor of the Trust.
"Tax Event" means the Regular Trustees shall have received an
opinion of nationally recognized independent tax counsel experi-
enced in such matters to the effect that, as a result of (a) any
amendment to, or change (including any announced prospective
change) in, the laws (or any regulations thereunder) of the
United States or any political subdivision or taxing authority
thereof or therein or (b) any amendment to or change in an
interpretation or application of such laws or regulations, there
is more than an insubstantial risk that (i) the Trust would be
subject to United States federal income tax with respect to
income accrued or received on the Subordinated Debt Securities,
(ii) interest payable to the Trust on the Subordinated Debt
Securities would not be deductible by the Debenture Issuer for
United States federal income tax purposes or (iii) the Trust
would be subject to more than a de minimis amount of other taxes,
duties or other governmental charges.
"10% in liquidation amount of the Securities" means, except as
provided in the terms of the Preferred Securities or by the Trust
Indenture Act, Holders of outstanding Securities voting together as
a single class or, as the context may require, Holders of
outstanding Preferred Securities or Holders of outstanding Common
Securities, voting separately as a class, representing at least 10%
of the aggregate liquidation amount (including the stated amount
that would be paid on redemption, liquidation or otherwise, plus
accrued and unpaid Distributions to the date upon which the voting
percentages are determined) of all outstanding Securities of the
relevant class.
"Treasury Regulations" means the income tax regulations, includ-
ing temporary and proposed regulations, promulgated under the
Code by the United States Treasury, as such regulations may be
amended from time to time (including corresponding provisions of
succeeding regulations).
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue
in office in accordance with the terms hereof, and all other
Persons who may from time to time be duly appointed, qualified
and serving as Trustees in accordance with the provisions hereof,
and references herein to a Trustee or the Trustees shall refer to
such Person or Persons solely in their capacity as trustees
hereunder.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
"Underwriting Agreement" means the Underwriting Agreement for the
offering and sale of Preferred Securities in the form of Exhibit
C.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of the
Trust Indenture Act that are required to be part of
this Declaration and shall, to the extent applicable,
be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is
a Trustee for the purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of this Decla-
ration limits, qualifies or conflicts with the duties
imposed by Sections 310 to 317, inclusive, of the Trust
Indenture Act, such imposed duties shall control.
(d) The application of the Trust Indenture Act to this
Declaration shall not affect the nature of the Securi-
ties as equity securities representing undivided
beneficial interests in the assets of the Trust.
SECTION 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Regular Trustees on behalf of
the Trust shall provide the Property Trustee (i) within
14 days after each record date for payment of Distribu-
tions, a list, in such form as the Property Trustee may
reasonably require, of the names and addresses of the
Holders of the Securities ("List of Holders") as of such
record date, provided that none of the Sponsor or the
_____________
Regular Trustees on behalf of the Trust shall be obli-
gated to provide such List of Holders at any time the
List of Holders does not differ from the most recent List
of Holders given to the Property Trustee by the Sponsor
and the Regular Trustees on behalf of the Trust, and (ii)
at any other time, within 30 days of receipt by the Trust
of a written request for a List of Holders as of a date
no more than 14 days before such List of Holders is
given to the Property Trustee. The Property Trustee
shall preserve, in as current a form as is reasonably
practicable, all information contained in Lists of
Holders given to it or which it receives in the capa-
city as Paying Agent (if acting in such capacity)
provided that the Property Trustee may destroy any List
_____________
of Holders previously given to it on receipt of a new
List of Holders.
(b) The Property Trustee shall comply with its obligations
under Sections 311(a), 311(b) and 312(b) of the Trust
Indenture Act.
SECTION 2.3 Reports by the Property Trustee.
Within 60 days after May 15 of each year, the Property Trustee
shall provide to the Holders of the Preferred Securities such
reports as are required by Section 313 of the Trust Indenture
Act, if any, in the form and in the manner provided by Section
313 of the Trust Indenture Act. The Property Trustee shall also
comply with the requirements of Section 313(d) of the Trust
Indenture Act.
SECTION 2.4 Periodic Reports to Property Trustee.
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and
information as required by Section 314 (if any) and the compliance
certificate required by Section 314 of the Trust Indenture Act in
the form, in the manner and at the times required by Section 314 of
the Trust Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Property Trustee such evidence of compliance
with any conditions precedent, if any, provided for in this
Declaration that relate to any of the matters set forth in Section
314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1)
may be given in the form of an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver.
(a) The Holders of a Majority in liquidation amount of
Preferred Securities may, by vote, on behalf of the
Holders of all of the Preferred Securities, waive any
past Event of Default in respect of the Preferred
Securities and its consequences, provided that, if the
underlying Event of Default under the Indenture:
(i) is not waivable under the Indenture, the Event of
Default under the Declaration shall also not be
waivable; or
(ii) requires the consent or vote of all or a Super-
Majority of the holders of the Debentures to be
waived under the Indenture, the Event of Default
under the Declaration may only be waived by the
vote of all of the Holders of the Preferred
Securities or such proportion thereof in liquida-
tion amount as represents the relevant Super
Majority of the aggregate principal amount of the
Debentures outstanding.
Upon such waiver, any such default shall cease to exist,
and any Event of Default with respect to the Preferred
Securities arising therefrom shall be deemed to have been
cured, for every purpose of this Declaration, but no such
waiver shall extend to any subsequent or other default or
an Event of Default with respect to the Preferred Securi-
ties or impair any right consequent thereon. Any waiver
by the Holders of the Preferred Securities of an Event of
Default with respect to the Preferred Securities shall
also be deemed to constitute a waiver by the Holders of
the Common Securities of any such Event of Default with
respect to the Common Securities for all purposes of this
Declaration without any further act, vote, or consent of
the Holders of the Common Securities.
(b) The Holders of a Majority in liquidation amount of the
Common Securities may, by vote, on behalf of the
Holders of all of the Common Securities, waive any past
Event of Default with respect to the Common Securities
and its consequences, provided that, if the underlying
_____________
Event of Default under the Indenture:
(i) which is not waivable under the Indenture, except
where the Holders of the Common Securities are
deemed to have waived such Event of Default under
the Declaration as provided below in this Section
2.6(b), the Event of Default under the Declara-
tion shall also not be waivable; or
(ii) which requires the consent or vote of a Super
Majority to be waived, except where the Holders
of the Common Securities are deemed to have
waived such Event of Default under the Declara-
tion as provided below in this Section 2(b), the
Event of Default under the Declaration may only
be waived by the vote of the Holders of at least
the proportion in liquidation amount of the
Preferred Securities as represents the relevant
Super Majority of the aggregate principal amount
of the Debentures outstanding;
provided that, each Holder of Common Securities will be
_____________
deemed to have waived any such Event of Default and all
Event of Default with respect to the Common Securities
and its consequences until all Events of Default with
respect to the Preferred Securities have been cured,
waived or otherwise eliminated, and until such Events
of Default have been so cured, waived or otherwise
eliminated, the Property Trustee will be deemed to be
acting solely on behalf of the Holders of the Preferred
Securities and only the Holders of the Preferred
Securities will have the right to direct the Property
Trustee in accordance with the terms of the Securities.
Subject to the foregoing provisions of this Section
2.6(b), upon such waiver, any such default shall cease
to exist and any Event of Default with respect to the
Common Securities arising therefrom shall be deemed to
have been cured for every purpose of this Declaration,
but no such waiver shall extend to any subsequent or
other default or Event of Default with respect to the
Common Securities or impair any right consequent
thereon.
(c) A waiver of an Event of Default under the Indenture by
the Property Trustee at the direction of the Holders of
the Preferred Securities, constitutes a waiver of the
corresponding Event of Default under this Declaration.
SECTION 2.7 Event of Default; Notice.
(a) The Property Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail,
first class postage prepaid, to the Holders of the
Securities, notices of all defaults with respect to the
Securities known to the Property Trustee, unless such
defaults have been cured before the giving of such
notice (the term "defaults" for the purposes of this
Section 2.7(a) being hereby defined to be an Event of
Default as defined in the Indenture, not including any
periods of grace provided for therein and irrespective
of the giving of any notice provided therein; provided
________
that, except for a default in the payment of principal
____
of (or premium, if any) or interest on any of the
Debentures or in the payment of any sinking fund
installment established for the Debentures, the
Property Trustee shall be protected in withholding such
notice if and so long as the board of directors, the
executive committee, or a trust committee of directors
and/or Responsible Officers of the Property Trustee
in good faith determines that the withholding of such
notice is in the interests of the Holders of the
Securities.
(b) The Property Trustee shall not be deemed to have knowl-
edge of any default except:
(i) a default under Sections 5.01(1) and 5.01(2) of the
Indenture; or
(ii) any default as to which the Property Trustee
shall have received written notice or a Responsi-
ble Officer charged with the administration of
the Declaration shall have obtained written
notice of.
ARTICLE III
ORGANIZATION
SECTION 3.1 Name.
The Trust is named "Southern Union Financing I", as such name may
be modified from time to time by the Regular Trustees following
written notice to the Holders of Securities. The Trust's activi-
ties may be conducted under the name of the Trust or any other
name deemed advisable by the Regular Trustees.
SECTION 3.2 Office.
The address of the principal office of the Trust is c/o Southern
Union Company, 504 Lavaca Street, Suite 800, Austin, Texas
78701. On ten Business Days written notice to the Holders of
Securities, the Regular Trustees may designate another principal
office.
SECTION 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to
issue and sell Securities and use the proceeds from such sale to
acquire the Debentures, and (b) except as otherwise limited
herein, to engage in only those other activities necessary, or
incidental thereto. The Trust shall not borrow money, issue debt
or reinvest proceeds derived from investments, pledge any of its
assets, or otherwise undertake (or permit to be undertaken) any
activity that would cause the Trust not to be classified for
United States federal income tax purposes as a grantor trust.
SECTION 3.4 Authority.
Subject to the limitations provided in this Declaration and to
the specific duties of the Property Trustee, the Regular Trustees
shall have exclusive and complete authority to carry out the
purposes of the Trust. An action taken by the Regular Trustees
in accordance with their powers shall constitute the act of and
serve to bind the Trust and an action taken by the Property
Trustee in accordance with its powers shall constitute the act of
and serve to bind the Trust. In dealing with the Trustees acting
on behalf of the Trust, no person shall be required to inquire
into the authority of the Trustees to bind the Trust. Persons
dealing with the Trust are entitled to rely conclusively on the
power and authority of the Trustees as set forth in this Declara-
tion.
SECTION 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the Debentures
and the Property Trustee Account or as otherwise provided in this
Declaration, legal title to all assets of the Trust shall be
vested in the Trust. The Holders shall not have legal title to
any part of the assets of the Trust, but shall have an undivided
beneficial interest in the assets of the Trust.
SECTION 3.6 Powers and Duties of the Regular Trustees.
The Regular Trustees shall have the exclusive power, duty and
authority to cause the Trust to engage in the following activi-
ties:
(a) to issue and sell the Preferred Securities and the
Common Securities in accordance with this Declaration;
provided, however, that the Trust may issue no more
_________________
than one series of Preferred Securities and no more
than one series of Common Securities, and, provided
________
further, that there shall be no interests in the Trust
_______
other than the Securities, and the issuance of Securi-
ties shall be limited to a one-time, simultaneous
issuance of both Preferred Securities and Common
Securities on the Closing Date;
(b) in connection with the issue and sale of the Preferred
Securities, at the direction of the Sponsor, to:
(i) execute and file with the Commission the regis-
tration statement on Form Section 3 prepared
by the Sponsor, including any amendments thereto,
pertaining to the Preferred Securities;
(ii) execute and file any documents prepared by
the Sponsor, or take any acts as determined by
the Sponsor to be necessary in order to qualify
or register all or part of the Preferred Securi-
ties in any State in which the Sponsor has
determined to qualify or register such Preferred
Securities for sale;
(iii) execute and file an application, prepared by
the Sponsor, to the New York Stock Exchange or
any other national stock exchange or the Nasdaq
National Market for listing upon notice of
issuance of any Preferred Securities;
(iv) execute and file with the Commission a registra-
tion statement on Form 8-A, including any
amendments thereto, prepared by the Sponsor
relating to the registration of the Preferred
Securities under Section 12(b) of the Exchange
Act; and
(v) execute and enter into the Underwriting Agreement
and Pricing Agreement providing for the sale of
the Preferred Securities;
(c) to acquire the Debentures with the proceeds of the sale
of the Preferred Securities and the Common Securities;
provided, however, that the Regular Trustees shall
_________________
cause legal title to the Debentures to be held of
record in the name of the Property Trustee for the
benefit of the Holders of the Preferred Securities and
the Holders or Common Securities;
(d) to give the Sponsor and the Property Trustee prompt
written notice of the occurrence of a Tax Event; provided
________
that the Regular Trustees shall consult with the Sponsor
____
and the Property Trustee before taking or refraining from
taking any Ministerial Action in relation to a Tax Event;
(e) to establish a record date with respect to all actions
to be taken hereunder that require a record date be
established, including and with respect to, for the
purposes of Section 316(c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and
exchanges, and to issue relevant notices to the Holders
of Preferred Securities and Holders of Common Securi-
ties as to such actions and applicable record dates;
(f) to take all actions and perform such duties as may be
required of the Regular Trustees pursuant to the terms
of the Securities;
(g) to bring or defend, pay, collect, compromise, arbi-
trate, resort to legal action, or otherwise adjust
claims or demands of or against the Trust ("Legal
Action"), unless pursuant to Section 3.8(e), the
Property Trustee has the exclusive power to bring such
Legal Action;
(h) to employ or otherwise engage employees and agents (who
may be designated as officers with titles) and
managers, contractors, advisors, and consultants and
pay reasonable compensation for such services;
(i) to cause the Trust to comply with the Trust's obliga-
tions under the Trust Indenture Act;
(j) to give the certificate required by Section 314(a)(4)
of the Trust Indenture Act to the Property Trustee,
which certificate may be executed by any Regular
Trustee;
(k) to incur expenses that are necessary or incidental to
carry out any of the purposes of the Trust;
(l) to act as, or appoint another Person to act as, regis-
trar and transfer agent for the Securities;
(m) to give prompt written notice to the Holders of the
Securities of any notice received from the Debenture
Issuer of its election (i) to defer payments of inter-
est on the Debentures by extending the interest payment
period under the Indenture or, (ii) to extend the
scheduled maturity date on the Debentures;
(n) to execute all documents or instruments, perform all
duties and powers, and do all things for and on behalf
of the Trust in all matters necessary or incidental to
the foregoing;
(o) to take all action that may be necessary or appropriate
for the preservation and the continuation of the
Trust's valid existence, rights, franchises and privi-
leges as a statutory business trust under the laws of
the State of Delaware and of each other jurisdiction in
which such existence is necessary to protect the
limited liability of the Holders of the Securities or
to enable the Trust to effect the purposes for which
the Trust was created;
(p) to take any action, not inconsistent with this Declara-
tion or with applicable law, that the Regular Trustees
determine in their discretion to be necessary or desir-
able in carrying out the activities of the Trust as set
out in this Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an
Investment Company required to be registered
under the Investment Company Act;
(ii) causing the Trust to be classified for United
States federal income tax as a grantor trust; and
(iii) cooperating with the Debenture Issuer to ensure
that the Debentures will be treated as indebted-
ness of the Debenture Issuer for United States
federal income tax purposes,
provided that such action does not adversely affect the
interests of Holders; and
(q) to take all action necessary to cause all applicable
tax returns and tax information reports that are re-
quired to be filed with respect to the Trust to be duly
prepared and filed by the Regular Trustees, on behalf
of the Trust.
The Regular Trustees must exercise the powers set forth in this
Section 3.6 in a manner that is consistent with the purposes and
functions of the Trust set out in Section 3.3, and the Regular
Trustees shall not take any action that is inconsistent with the
purposes and functions of the Trust set forth in Section 3.3.
Subject to this Section 3.6, the Regular Trustees shall have none
of the powers or the authority of the Property Trustee set forth
in Section 3.8.
SECTION 3.7 Prohibition of Actions by the Trust and the
Trustees.
(a) The Trust shall not, and the Trustees (including the
Property Trustee) shall not, engage in any activity
other than as required or authorized by this Declara-
tion. In particular, the Trust shall not and the
Trustees (including the Property Trustee) shall cause the
Trust not to:
(i) invest any proceeds received by the Trust from
holding the Debentures, but shall distribute all
such proceeds to Holders of Securities pursuant
to the terms of this Declaration and of the Secu-
rities;
(ii) acquire any assets other than as expressly
provided herein;
(iii) possess Trust property for other than a Trust
purpose;
(iv) make any loans or incur any indebtedness other
than loans represented by the Debentures;
(v) possess any power or otherwise act in such a
way as to vary the Trust assets or the terms of
the Securities in any way whatsoever;
(vi) issue any securities or other evidences of
beneficial ownership of, or beneficial interest
in, the Trust other than the Securities; or
(vii) (A) direct the time, method and place of exer-
cising any trust or power conferred upon the
Debenture Trustee with respect to the Deben-
tures, (B) waive any past default that is
waivable under Section 513 of the Indenture,
(C) exercise any right to rescind or annul
any declaration that the principal of all the
Debentures shall be due and payable or (D)
consent to any amendment, modification or
termination of the Indenture or the Deben-
tures where such consent shall be required
unless the Trust shall have received an
opinion of counsel to the effect that such
modification will not cause more than an
insubstantial risk that for United States
federal income tax purposes the Trust will not
be classified as a grantor trust.
SECTION 3.8 Powers and Duties of the Property Trustee.
(a) The legal title to the Debentures shall be owned by and
held of record in the name of the Property Trustee in
trust for the benefit of the Holders of the Securities.
The right, title and interest of the Property Trustee
to the Debentures shall vest automatically in each
Person who may hereafter be appointed as Property
Trustee in accordance with in Section 5.6. Such
vesting and cessation of title shall be effective
whether or not conveyancing documents with regard to
the Debentures have been executed and delivered.
(b) The Property Trustee shall not transfer its right,
title and interest in the Debentures to the Regular
Trustees or to the Delaware Trustee (if the Property
Trustee does not also act as Delaware Trustee).
(c) The Property Trustee shall:
(i) establish and maintain a segregated non-interest
bearing trust account (the "Property Trustee
Account") in the name of and under the exclusive
control of the Property Trustee on behalf of the
Holders of the Securities and, upon the receipt
of payments of funds made in respect of the
Debentures held by the Property Trustee, deposit
such funds into the Property Trustee Account and
make payments to the Holders of the Preferred
Securities and Holders of the Common Securities
from the Property Trustee Account in accordance
with Section 6.1. Funds in the Property
Trustee Account shall be held uninvested until
disbursed in accordance with this Declaration.
The Property Trustee Account shall be an account
that is maintained with a banking institution
the rating on whose long term unsecured indebted-
ness is at least equal to the rating assigned to
the Preferred Securities by a "nationally recog-
nized statistical rating organization", as that
term is defined for purposes of Rule 436(g)(2)
under the Securities Act;
(ii) engage in such ministerial activities as shall be
necessary or appropriate to effect the redemption
of the Preferred Securities and the Common
Securities to the extent the Debentures are re-
deemed or mature; and
(iii) upon notice of distribution issued by the Regular
Trustees in accordance with the terms of the Pre-
ferred Securities and forms of the Common Securi-
ties, engage in such ministerial activities as
shall be necessary or appropriate to effect the
distribution of the Debentures to Holders of
Securities upon the occurrence of certain special
events (as may be defined in the terms of the
Securities) arising from a change in law or a
change in legal interpretation or other specified
circumstances pursuant to the terms of the
Securities.
(d) The Property Trustee shall take all actions and perform
such duties as may be specifically required of the
Property Trustee pursuant to the terms of the Securi-
ties.
(e) The Property Trustee shall take any Legal Action which
arises out of or in connection with an Event of Default
or the Property Trustee's duties and obligations under
this Declaration or the Trust Indenture Act.
(f) The Property Trustee shall not resign as a Trustee
unless either:
(i) the Trust has been completely liquidated and
the proceeds of the liquidation distributed to
the Holders of Securities pursuant to the terms
of the Securities; or
(ii) a Successor Property Trustee has been appointed
and has accepted that appointment in accordance
with Section 5.6.
(g) The Property Trustee shall have the legal power to
exercise all of the rights, powers and privileges of a
holder of Debentures under the Indenture and, if an
Event of Default occurs and is continuing, the Property
Trustee shall, for the benefit of Holders of the
Securities, enforce its rights as holder of the
Debentures subject to the rights of the Holders pursu-
ant to the terms of such Securities.
(h) The Property Trustee may authorize one or more Persons
(each, a "Paying Agent") to pay Distributions, redemp-
tion payments or liquidation payments on behalf of the
Trust with respect to all securities and any such
Paying Agent shall comply with Section 317(b) of the
Trust Indenture Act. Any Paying Agent may be
removed by the Property Trustee at any time and a
successor Paying Agent or additional Paying Agents may
be appointed at any time by the Property Trustee.
(i) Subject to this Section 3.8, the Property Trustee shall
have none of the duties, liabilities, powers or the
authority of the Regular Trustees set forth in Section
3.6.
The Property Trustee must exercise the powers set forth in
this Section 3.8 in a manner that is consistent with the
purposes and functions of the Trust set out in Section 3.3,
and the Property Trustee shall not take any action that is
inconsistent with the purposes and functions of the Trust
set out in Section 3.3.
SECTION 3.9 Certain Duties and Responsibilities of the Property
Trustee.
(a) The Property Trustee, before the occurrence of any
Event of Default and after the curing of all Events of
Default that may have occurred, shall undertake to
perform only such duties as are specifically set forth
in this Declaration and no implied covenants shall be
read into this Declaration against the Property
Trustee. In case an Event of Default has occurred
(that has not been cured or waived pursuant to Section
2.6), the Property Trustee shall exercise such of the
rights and powers vested in it by this Declaration, and
use the same degree of care and skill in their exer-
cise, as a prudent person would exercise or use under
the circumstances in the conduct of his or her own
affairs.
(b) No provision of this Declaration shall be construed to
relieve the Property Trustee from liability for its own
negligent action, its own negligent failure to act, or
its own willful misconduct, except that:
(i) prior to the occurrence of an Event of Default
and after the curing or waiving of all such
Events of Default that may have occurred:
(A) the duties and obligations of the Property
Trustee shall be determined solely by the
express provisions of this Declaration and
the Property Trustee shall not be liable
except for the performance of such duties
and obligations as are specifically set
forth in this Declaration, and no implied
covenants or obligations shall be read into
this Declaration against the Property
Trustee; and
(B) in the absence of bad faith on the part of
the Property Trustee, the Property Trustee
may conclusively rely, as to the truth of
the statements and the correctness of the
opinions expressed therein, upon any cer-
tificates or opinions furnished to the
Property Trustee and conforming to the re-
quirements of this Declaration; but in the
case of any such certificates or opinions
that by any provision hereof are
specifically required to be furnished to the
Property Trustee, the Property Trustee shall
be under a duty to examine the same to
determine whether or not they conform to the
requirements of this Declaration;
(ii) the Property Trustee shall not be liable for
any error of judgment made in good faith by a
Responsible Officer of the Property Trustee,
unless it shall be proved that the Property
Trustee was negligent in ascertaining the per-
tinent facts;
(iii) the Property Trustee shall not be liable with
respect to any action taken or omitted to be
taken by it in good faith in accordance with the
direction of the Holders of not less than a
Majority in liquidation amount of the Securities
at the time outstanding relating to the time,
method and place of conducting any proceeding
for any remedy available to the Property
Trustee, or exercising any trust or power
conferred upon the Property Trustee under this
Declaration;
(iv) no provision of this Declaration shall require
the Property Trustee to expend or risk its own
funds or otherwise incur personal financial
liability in the performance of any of its
duties or in the exercise of any of its rights
or powers, if it shall have reasonable ground
for believing that the repayment of such funds
or liability is not reasonably assured to it
under the terms of this Declaration or adequate
indemnity against such risk or liability is not
reasonably assured to it;
(v) the Property Trustee's sole duty with respect
to the custody, safe keeping and physical pres-
ervation of the Debentures and the Property
Trustee Account shall be to deal with such
property in a similar manner as the Property
Trustee deals with similar property for its own
account, subject to the protections and limita-
tions on liability afforded to the Property
Trustee under this Declaration, the Trust Inden-
ture Act and Rule 3a-7;
(vi) the Property Trustee shall have no duty or lia-
bility for or with respect to the value,
genuineness, existence or sufficiency of the
Debentures or the payment of any taxes or
assessments levied thereon or in connection
therewith;
(vii) the Property Trustee shall not be liable for
any interest on any money received by it except
as it may otherwise agree with the Sponsor.
Money held by the Property Trustee need not be
segregated from other funds held by it except in
relation to the Property Trustee Account main-
tained by the Property Trustee pursuant to Section
3.8(c)(i) and except to the extent otherwise
required by law;
(viii) the Property Trustee shall not be responsible
for monitoring the compliance by the Regular
Trustees or the Sponsor with their respective
duties under this Declaration, nor shall the
Property Trustee be liable for the default or
misconduct of the Regular Trustees or the Spon-
sor.
SECTION 3.10 Certain Rights of Property Trustee.
(a) Subject to the provisions of Section 3.9:
(i) the Property Trustee may rely and shall be fully
protected in acting or refraining from acting
upon any resolution, certificate, statement,
instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other
paper or document believed by it to be genuine
and to have been signed, sent or presented by
the proper party or parties;
(ii) any direction or act of the Sponsor or the Regu-
lar Trustees contemplated by this Declaration
shall be sufficiently evidenced by a Direction
or an Officers' Certificate;
(iii) whenever in the administration of this Declara-
tion, the Property Trustee shall deem it desir-
able that a matter be proved or established
before taking, suffering or omitting any action
hereunder, the Property Trustee (unless other
evidence is herein specifically prescribed) may,
in the absence of bad faith on its part request
and rely upon an Officers' Certificate which, upon
receipt of such request, shall be promptly
delivered by the Sponsor or the Regular Trustees;
(iv) the Property Trustee shall have no duty to see
to any recording, filing or registration of any
instrument (including any financing or continua-
tion statement or any filing under tax or
securities laws) (or any rerecording, refiling or
registration thereof);
(v) the Property Trustee may consult with counsel or
other experts and the advice or opinion of such
counsel and experts with respect to legal matters
or advice within the scope of such experts' area
of expertise shall be full and complete authoriza-
tion and protection in respect of any action
taken, suffered or omitted by it hereunder
in good faith and in accordance with such advice
or opinion such counsel may be counsel to the
Sponsor or any of its Affiliates, and may
include any of its employees. The Property
Trustee shall have the right at any time to seek
instructions concerning the administration of
this Declaration from any court of competent
jurisdiction;
(vi) the Property Trustee shall be under no obliga-
tion to exercise any of the rights or powers
vested in it by this Declaration at the request
or direction of any Holder, unless such Holder
shall have provided to the Property Trustee
adequate security and indemnity, which would
satisfy a reasonable person in the position of
the Property Trustee, against the costs,
expenses (including attorneys' fees and
expenses) and liabilities that might be incurred
by it in complying with such request or direc-
tion, including such reasonable advances as may
be requested by the Property Trustee provided,
that, nothing contained in this Section
3.10(a)(vi) shall be taken to relieve the
Property Trustee, upon the occurrence of an
Event of Default, of its obligation to exercise
the rights and powers vested in it by this
Declaration;
(vii) the Property Trustee shall not be bound to make
any investigation into the facts or matters
stated in any resolution, certificate, state-
ment, instrument, opinion, report, notice,
request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness
or other paper or document, but the Property
Trustee, in its discretion, may make such
further inquiry or investigation into such facts
or matters as it may see fit;
(viii) the Property Trustee may execute any of the
trusts or powers hereunder or perform any duties
hereunder either directly or by or through
agents or attorneys and the Property Trustee
shall not be responsible for any misconduct or
negligence on the part of any agent or attorney
appointed with due care by it hereunder;
(ix) any action taken by the Property Trustee or its
agents hereunder shall bind the Trust and the
Holders of the Securities, and the signature of
the Property Trustee or its agents alone shall
be sufficient and effective to perform any
such action and no third party shall be re-
quired to inquire as to the authority of the
Property Trustee to so act or as to its
compliance with any of the terms and provisions
of this Declaration, both of which shall be
conclusively evidenced by the Property Trustee's
or its agent's taking such action;
(x) whenever in the administration of this Declara-
tion the Property Trustee shall deem it desir-
able to receive instructions with respect to
enforcing any remedy or right or taking any
other action hereunder the Property Trustee (i)
may request instructions from the Holders of the
Securities which instructions may only be given by
the Holders of the same proportion in liquidation
amount of The Securities as would be entitled to
direct the Property Trustee under the Terms of the
Securities in respect of such remedy, right or
action, (ii) may refrain from enforcing such
remedy or right or taking such other action
until such instructions are received, and (iii)
shall be protected in acting in accordance with
such instructions; and
(xi) except as otherwise expressly provided by this
Declaration, the Property Trustee shall not be
under any obligation to take any action that is
discretionary under the provisions of this
Declaration.
(b) No provision of this Declaration shall be deemed to
impose any duty or obligation on the Property Trustee
to perform any act or acts or exercise any right,
power, duty or obligation conferred or imposed on it,
in any jurisdiction in which it shall be illegal, or in
which the Property Trustee shall be unqualified or
incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such
right, power, duty or obligation. No permissive power
or authority available to the Property Trustee shall be
construed to be a duty.
SECTION 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration other
than Section 5.2, the Delaware Trustee shall not be entitled to
exercise any powers, nor shall the Delaware Trustee have any of
the duties and responsibilities of the Regular Trustees or the
Property Trustee described in this Declaration. Except as set
forth in Section 5.2, the Delaware Trustee shall be a Trustee for
the sole and limited purpose of fulfilling the requirements of
Section 3807 of the Business Trust Act.
SECTION 3.12 Execution of Documents.
Unless otherwise determined by the Regular Trustees, and except
as otherwise required by the Business Trust Act, a majority of
or, if there are only two, both of the Regular Trustees are
authorized to execute on behalf of the Trust any documents that
the Regular Trustees have the power and authority to execute
pursuant to Section 3.6; provided that, any listing application
prepared by the Sponsor referred to in Section 3.6(b)(iii) may be
executed by one Regular Trustee.
SECTION 3.13 Not Responsible for Recitals or Issuance of Securi-
ties.
The recitals contained in this Declaration and the Securities
shall be taken as the statements of the Sponsor, and the Trustees
do not assume any responsibility for their correctness. The
Trustees make no representations as to the value or condition of
the property of the Trust or any part thereof. The Trustees make
no representations as to the validity or sufficiency of this
Declaration or the Securities.
SECTION 3.14 Duration of Trust.
The Trust, unless terminated pursuant to the provisions of
Article VIII hereof, shall have existence for 55 years from the
Closing Date.
SECTION 3.15 Mergers.
(a) The Trust may not consolidate, amalgamate, merge with
or into, or be replaced by, or convey, transfer or
lease its properties and assets substantially as an
entirety to any corporation or other body, except as
described in Section 3.15(b) and (c).
(b) The Trust may, with the consent of a majority of the
Regular Trustees and without the consent of the Holders
of the Securities, the Delaware Trustee or the Property
Trustee, consolidate, amalgamate, merge with or into, or
be replaced by a trust organized as such under the laws
of any State; provided that:
_____________
(i) such successor entity (the "Successor Entity")
either:
(A) expressly assumes all of the obligations
of the Trust under the Securities; or
(B) substitutes for the Securities other
securities having substantially the same
terms as the Preferred Securities (the
"Successor Securities") so long as the
Successor Securities rank the same as the
Preferred Securities rank with respect to
Distributions and payments upon liquida-
tion, redemption and maturity;
(ii) the Debenture Issuer expressly acknowledges a
trustee of the Successor Entity that possesses
the same powers and duties as the Property
Trustee as the Holder of the Debentures;
(iii) the Preferred Securities or any Successor Secu-
rities are listed, or any Successor Securities
will be listed upon notification of issuance, on
any national securities exchange or other
organization on which the Preferred Securities
are then listed;
(iv) such merger, consolidation, amalgamation or
replacement does not cause the Preferred Securi-
ties (including any Successor Securities) to be
downgraded by any nationally recognized statis-
tical rating organization;
(v) such merger, consolidation, amalgamation or
replacement does not adversely affect the
rights, preferences and privileges of the
Holders of the Securities (including any Successor
Securities) in any material respect (other than
with respect to any dilution of such Holders'
interests in the Preferred Securities as a result
of such merger, consolidation, amalgamation or
replacement;
(vi) such successor entity has a purpose identical
to that of the Trust;
(vii) prior to such merger, consolidation, amalgama-
tion or replacement, the Sponsor has received
an opinion of a nationally recognized indepen-
dent counsel to the Trust experienced in such
matters to the effect that:
(A) such merger, consolidation, amalgamation
or replacement does not adversely affect
the rights, preferences and privileges of
the Holders of the Securities (including any
Successor Securities) in any material
respect (other than with respect to any
dilution of the Holders' interest in the new
entity); and
(B) following such merger, consolidation,
amalgamation or replacement, neither the
Trust nor the Successor Entity will be
required to register as an Investment
Company; and
(viii) the Sponsor guarantees the obligations of such
Successor Entity under the Successor Securities
at least to the extent provided by the Preferred
Securities Guarantee.
(c) Notwithstanding Section 3.15(b), the Trust shall,
except with the consent of Holders of 100% in liquida-
tion amount of the Securities, not consolidate, amal-
gamate, merge with or into, or be replaced by any other
entity or permit any other entity to consolidate,
amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger or replacement
would cause the Trust or Successor Entity for United
States federal income tax purposes not to be classified
as a grantor trust.
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities.
On the Closing Date the Sponsor will purchase all the Common
Securities issued by the Trust, in an amount equal to 3% of the
capital of the Trust, at the same time as the Preferred Securi-
ties are sold.
SECTION 4.2 Responsibilities of the Sponsor.
In connection with the issue and sale of the Preferred Securi-
ties, the Sponsor shall have the exclusive right and responsibil-
ity to engage in the following activities:
(a) to prepare for filing by the Trust with the Commission
a registration statement on Form S-3 in relation to the
Preferred Securities, including any amendments thereto;
(b) to determine the States in which to take appropriate
action to qualify or register for sale all or part of
the Preferred Securities and to do any and all such
acts, other than actions which must be taken by the
Trust, and advise the Trust of actions it must take,
and prepare for execution and filing any documents to
be executed and filed by the Trust, as the Sponsor
deems necessary or advisable in order to comply with
the applicable laws of any such States;
(c) to prepare for filing by the Trust an application to
the New York Stock Exchange or any other national stock
exchange or the Nasdaq National Market for listing upon
notice of issuance of any Preferred Securities;
(d) to prepare for filing by the Trust with the Commission
a registration statement on Form 8-A relating to the
registration of the Preferred Securities under Section
12(b) of the Exchange Act, including any amendments
thereto; and
(e) to negotiate the terms of the Underwriting Agreement
and Pricing Agreement providing for the sale of the
Preferred Securities.
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees.
The number of Trustees shall initially be three (3), and:
(a) at any time before the issuance of any Securities, the
Sponsor may, by written instrument, increase or de-
crease the number of Trustees; and
(b) after the issuance of any Securities:
(i) and except as provided in Sections 5.1(b)(ii) and
5.6(a)(ii)(B) with respect to the Special Regular
Trustee, the number of Trustees may be increased
or decreased by vote of the Holders of a Majority
in liquidation amount of the Common Securities
voting as a class at a meeting of the Holders of
the Common Securities; and
(ii) the number of Trustees shall be increased auto-
matically by one (1) if an Appointment Event has
occurred and is continuing and the Holders of a
Majority in liquidation amount of the Preferred
Securities appoint a Special Regular Trustee in
accordance with Section 5.6.
SECTION 5.2 Delaware Trustee.
If required by the Business Trust Act, one Trustee (the "Delaware
Trustee") shall be:
(a) a natural person who is a resident of the State of
Delaware; or
(b) if not a natural person, an entity which has its prin-
cipal place of business in the State of Delaware, and
otherwise meets the requirements of applicable law,
provided that, if the Property Trustee has its principal place of
business in the State of Delaware and otherwise meets the re-
quirements of applicable law, then the Property Trustee shall
also be the Delaware Trustee and Section 3.11 shall have no
application.
SECTION 5.3 Property Trustee; Eligibility.
(a) There shall at all times be one Trustee which shall act
as Property Trustee which shall:
(i) not be an Affiliate of the Sponsor;
(ii) be a corporation organized and doing business
under the laws of the United States of America or
any State or Territory thereof or of the District
of Columbia, or a corporation or Person permitted
by the Commission to act as an institutional
trustee under the Trust Indenture Act, authorized
under such laws to exercise corporate trust
powers, having a combined capital and surplus of
at least 50 million U.S. dollars ($50,000,000),
and subject to supervision or examination by
Federal, State, Territorial or District of
Columbia authority. If such corporation pub-
lishes reports of condition at least annually,
pursuant to law or to the requirements of the
supervising or examining authority referred to
above, then for the purposes of this Section
5.3(a)(ii), the combined capital and surplus of
such corporation shall be deemed to be its com-
bined capital and surplus as set forth in its
most recent report of condition so published; and
(iii) if the Trust is excluded from the definition of
an Investment Company solely by means of Rule
3a-7 and to the extent Rule 3a-7 requires a
trustee having certain qualifications to hold
title to the "eligible assets" of the Trust, the
Property Trustee shall possess those qualifica-
tions.
(b) If at any time the Property Trustee shall cease to be
eligible to so act under Section 5.3(a), the Property
Trustee shall immediately resign in the manner and with
the effect set forth in Section 5.6(c).
(c) If the Property Trustee has or shall acquire any "con-
flicting interest" within the meaning of Section
310(b) of the Trust Indenture Act, the Property Trustee
and the Holder of the Common Securities (as if it were
the obligor referred to in Section 310(b) of the Trust
Indenture Act) shall in all respects comply with the
provisions of Section 310(b) of the Trust Indenture
Act.
(d) The Preferred Securities Guarantee shall be deemed to
be specifically described in this Declaration for
purposes of clause (i) of the first provision contained
in Section 310(b) of the Trust Indenture Act.
SECTION 5.4 Qualifications of Regular Trustees and Delaware
Trustee Generally.
Each Regular Trustee and the Delaware Trustee (unless the
Property Trustee also acts as Delaware Trustee) shall be either a
natural person who is at least 21 years of age or a legal entity
that shall act through one or more Authorized Officers.
SECTION 5.5 Initial Trustees.
The initial Regular Trustees shall be:
Ronald J. Endres
504 Lavaca Street, Suite 800
Austin, Texas 78701
David J. Kvapil
504 Lavaca Street, Suite 800
Austin, Texas 78701
The initial Delaware Trustee shall be:
Wilmington Trust Company
1100 N. Market Street
Wilmington, Delaware 19890
which shall also act as Property Trustee.
SECTION 5.6 Appointment, Removal and Resignation of Trustees.
(a) Subject to Section 5.6(b), Trustees may be appointed or
removed without cause at any time:
(i) until the issuance of any Securities, by written
instrument executed by the Sponsor; and
(ii) after the issuance of any Securities:
(A) other than in respect to a Special Regular
Trustee, by vote of the Holders of a Majority
in liquidation amount of the Common Securi-
ties voting as a class at a meeting of
the Holders of the Common Securities; and
(B) if an Appointment Event has occurred and is
continuing, one (1) additional Regular
Trustee (the "Special Regular Trustee") may
be appointed by vote of the Holders of a
Majority in liquidation amount of the Pre-
ferred Securities, voting as a class at a
meeting of the Holders of the Preferred
Securities, and such Special Regular Trustee
may only be removed (otherwise than by the
operation of Section 5.6(c)), by vote of
the Holders of a Majority in liquidation
amount of the Preferred Securities voting as
a class at a meeting of the Holders of the
Preferred Securities.
(b) (i) The Trustee that acts as Property Trustee shall
not be removed in accordance with Section 5.6(a)
until a Successor Property Trustee has been
appointed and has accepted such appointment by
written instrument executed by such Successor
Property Trustee and delivered to the Regular
Trustees and the Sponsor; and
(ii) the Trustee that acts as Delaware Trustee shall
not be removed in accordance with this Section
5.6(a) until a successor Trustee possessing the
qualifications to act as Delaware Trustee under
Sections 5.2 and 5.4 (a "Successor Delaware
Trustee") has been appointed and has accepted
such appointment by written instrument executed
by such Successor Delaware Trustee and delivered
to the Regular Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office until
his successor shall have been appointed or until his
death, removal or resignation, provided that a Special
_____________
Regular Trustee shall only hold office while an Ap-
pointment Event is continuing and shall cease to hold
office immediately after the Appointment Event pursuant
to which the Special Regular Trustee was appointed and
all other Appointment Events cease to be continuing.
Any Trustee may resign from office (without need for
prior or subsequent accounting) by an instrument in
writing signed by the Trustee and delivered to the
Sponsor and the Trust, which resignation shall take
effect upon such delivery or upon such later date as is
specified therein; provided, however, that:
_________________
(i) No such resignation of the Trustee that acts as
the Property Trustee shall be effective:
(A) until a Successor Property Trustee has
been appointed and has accepted such ap-
pointment by instrument executed by such
Successor Property Trustee and delivered to
the Trust, the Sponsor and the resigning
Property Trustee; or
(B) if the Trust is not deemed an Investment
Company solely by reason of Rule 3a-7, until
the assets of the Trust have been completely
liquidated and the proceeds thereof dis-
tributed to the holders of the Securities;
(ii) no such resignation of the Trustee that acts as
the Delaware Trustee shall be effective until a
Successor Delaware Trustee has been appointed and
has accepted such appointment by instrument
executed by such Successor Delaware Trustee and
delivered to the Trust, the Sponsor and the
resigning Delaware Trustee; and
(iii) no such resignation of a Special Regular Trustee
shall be effective until the 60th day following
delivery of the instrument of resignation of the
Special Regular Trustee to the Sponsor and the
Trust or such later date specified in such
instrument during which period the Holders of the
Preferred Securities shall have the right to
appoint a successor Special Trustee as provided
in this Section 5.6;
(d) The Holders of the Common Securities shall use their best
efforts to promptly appoint a Successor Delaware Trustee
or Successor Property Trustee as the case may be if the
Property Trustee or the Delaware Trustee delivers an
instrument of resignation in accordance with this Section
5.6.
(e) If no Successor Property Trustee or Successor Delaware
Trustee shall have been appointed and accepted appoint-
ment as provided in this Section 5.6 within 60 days
after delivery to the Sponsor and the Trust of an
instrument of resignation, the resigning Property
Trustee or Delaware Trustee, as applicable, may peti-
tion any court of competent jurisdiction for appoint-
ment of a Successor Property Trustee or Successor
Delaware Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem
proper and prescribe, appoint a Successor Property
Trustee or Successor Delaware Trustee, as the case may
be.
SECTION 5.7 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the number
of Trustees is not reduced pursuant to Section 5.1, or if the
number of Trustees is increased pursuant to Section 5.1, a
vacancy shall occur. A resolution certifying the existence of
such vacancy by a majority of the Regular Trustees shall be
conclusive evidence of the existence of such vacancy. The vacancy
shall be filled with a Trustee appointed in accordance
with Section 5.6.
SECTION 5.8 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy, dissolu-
tion, liquidation, incompetence or incapacity to perform the
duties of a Trustee shall not operate to annul the Trust.
Whenever a vacancy in the number of Regular Trustees shall occur,
until such vacancy is filled by the appointment of a Regular
Trustee in accordance with Section 5.6, the Regular Trustees in
office, regardless of their number, shall have all the powers
granted to the Regular Trustees and shall discharge all the
duties imposed upon the Regular Trustees by this Declaration.
SECTION 5.9 Meetings.
Meetings of the Regular Trustees shall be held from time to time
upon the call of any Regular Trustee. Regular meetings of the
Regular Trustees may be held at a time and place fixed by reso-
lution of the Regular Trustees. Notice of any in-person meetings
of the Regular Trustees shall be hand delivered or otherwise
delivered in writing (including by facsimile, with a hard copy by
overnight courier) not less than 48 hours before such meeting.
Notice of any telephonic meetings of the Regular Trustees or any
committee thereof shall be hand delivered or otherwise delivered
in writing (including by facsimile, with a hard copy by overnight
courier) not less than 24 hours before a meeting. Notices shall
contain a brief statement of the time, place and anticipated pur-
poses of the meeting. The presence (whether in person or by
telephone) of a Regular Trustee at a meeting shall constitute a
waiver of notice of such meeting except where a Regular Trustee
attends a meeting for the express purpose of objecting to the
transaction of any activity on the ground that the meeting has
not been lawfully called or convened. Unless provided otherwise
in this Declaration, any action of the Regular Trustees may be
taken at a meeting by vote of a majority of the Regular Trustees
present (whether in person or by telephone) and eligible to vote
with respect to such matter, provided that a Quorum is present,
or without a meeting by the unanimous written consent of the
Regular Trustees.
SECTION 5.10 Delegation of Power.
(a) Any Regular Trustee may, by power of attorney consis-
tent with applicable law, delegate to any other natural
person over the age of 21 his or her power for the pur-
pose of executing any documents contemplated in Section
3.6, including any registration statement or amendment
thereto filed with the Commission, or making any other
governmental filing; and
(b) the Regular Trustees shall have power to delegate from
time to time to such of their number or to officers of
the Trust the doing of such things and the execution of
such instruments either in the name of the Trust or the
names of the Regular Trustees or otherwise as the
Regular Trustees may deem expedient, to the extent such
delegation is not prohibited by applicable law or con-
trary to the provisions of the Trust, as set forth
herein.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions.
Holders shall receive Distributions (as defined herein) in accor-
dance with the applicable terms of the relevant Holder's Securi-
ties. Distributions shall be made on the Preferred Securities
and the Common Securities in accordance with the preferences set
forth in their respective terms. If and to the extent that the
Debenture Issuer makes a payment of interest (including Com-
pounded Interest (as defined in the Indenture)) and Additional
Interest (as defined in the Indenture), premium and principal on
the Debentures held by the Property Trustee (the amount of any
such payment being a "Payment Amount"), the Property Trustee
shall and is directed, to the extent funds are available for that
purpose, to make a distribution (a "Distribution") of the Payment
Amount to Holders.
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities.
(a) The Regular Trustees shall on behalf of the Trust issue
one class of preferred securities representing
undivided beneficial interests in the assets of the
Trust having such terms as are set forth in Exhibit A
(the "Preferred Securities") and one class of common
securities representing undivided beneficial interests in
the assets of the Trust having such terms as are set
forth in Exhibit A (the "Common Securities.") The Trust
shall have no securities or other interests in the as-
sets of the Trust other than the Preferred Securities
and the Common Securities.
(b) The Certificates shall be signed on behalf of the Trust
by the Regular Trustees (or if there are more than two
Regular Trustees by any two of the Regular Trustees).
Such signatures may be the manual or facsimile signa-
tures of the present or any future Regular Trustee.
Typographical and other minor errors or defects in any
such reproduction of any such signature shall not
affect the validity of any Certificate. In case any
Regular Trustee of the Trust who shall have signed any
of the Securities shall cease to be such Regular
Trustee before the Certificates so signed shall be
delivered by the Trust, such Certificates nevertheless
may be delivered as though the person who signed such
Certificates had not ceased to be such Regular Trustee;
and any Certificate may be signed on behalf of the
Trust by such persons who, at the actual date of
execution of such Security, shall be the Regular
Trustees of the Trust, although at the date of the
execution and delivery of the Declaration any such per-
son was not such a Regular Trustee. Certificates shall
be printed, lithographed or engraved or may be produced
in any other manner as is reasonably acceptable to the
Regular Trustees, as evidenced by their execution
thereof, and may have such letters, numbers or other
marks of identification or designation and such legends
or endorsements as the Regular Trustees may deem appro-
priate, or as may be required to comply with any law or
with any rule or regulation of any stock exchange on
which Securities may be listed, or to conform to usage.
(c) The consideration received by the Trust for the issu-
ance of the Securities shall constitute a contribution
to the capital of the Trust and shall not constitute a
loan to the Trust.
(d) Upon issuance of the Securities as provided in this
Declaration, the Securities so issued shall be deemed
to be validly issued, fully paid and non-assessable.
(e) Every Person, by virtue of having become a Holder or a
Preferred Security Beneficial Owner in accordance with
the terms of this Declaration, shall be deemed to have
expressly assented and agreed to the terms of, and
shall be bound by, this Declaration.
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust.
(a) The Trust shall terminate:
(i) upon the bankruptcy of the Holder of the Common
Securities or the Sponsor;
(ii) upon the filing of a certificate of dissolution
or its equivalent with respect to the Holder of
the Common Securities or the Sponsor; the filing of
a certificate of cancellation with respect to the
Trust or the revocation of the Holder of the Common
Securities or the Sponsor's charter and the
expiration of 90 days after the date of revocation
without a reinstatement thereof;
(iii) upon the entry of a decree of judicial dissolu-
tion of the Holder of the Common Securities, the
Sponsor or the Trust;
(iv) when all of the Securities shall have been called
for redemption and the amounts necessary for
redemption thereof shall have been paid to the
Holders in accordance with the terms of the
Securities;
(v) upon the occurrence and continuation of a Tax
Event pursuant to which the Trust shall have been
dissolved in accordance with the terms of the
Securities and all of the Debentures endorsed
thereon shall have been distributed to the
Holders of Securities in exchange for all of the
Securities; or
(vi) before the issuance of any Securities, with the
consent of all of the Regular Trustees and the
Sponsor.
(b) As soon as is practicable after the occurrence of an
event referred to in Section 8.1(a), the Trustees shall
file a certificate of cancellation with the Secretary
of State of the State of Delaware.
(c) The provisions of Section 3.9 and Article X shall
survive the termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities.
(a) Securities may only be transferred, in whole or in
part, in accordance with the terms and conditions set
forth in this Declaration and in the terms of the Secu-
rities. Any transfer or purported transfer of any
Security not made in accordance with this Declaration
shall be null and void.
(b) Subject to this Article IX, Preferred Securities shall
be freely transferable.
(c) Subject to this Article IX, the Sponsor and any Related
Party may only transfer Common Securities to the Spon-
sor or a Related Party of the Sponsor; provided that,
_____________
any such transfer is subject to the condition precedent
that the transferor obtain the written opinion of
nationally recognized independent counsel experienced
in such matters that such transfer would not cause
more than an insubstantial risk that:
(i) the Trust would not be classified for United States
federal income tax purposes as a grantor trust; and
(ii) the Trust would be an Investment Company or the
transferee would become an Investment Company.
SECTION 9.2 Transfer of Certificates.
The Regular Trustees shall provide for the registration of Cer-
tificates and of transfers of Certificates, which will be
effected without charge but only upon payment (with such indem-
nity as the Regular Trustees may require) in respect of any tax
or other government charges that may be imposed in relation to
it. Upon surrender for registration of transfer of any Certifi-
cate, the Regular Trustees shall cause one or more new Certifi-
cates to be issued in the name of the designated transferee or
transferees. Every Certificate surrendered for registration of
transfer shall be accompanied by a written instrument of transfer
in form satisfactory to the Regular Trustees duly executed by the
Holder or such Holder's attorney duly authorized in writing.
Each Certificate surrendered for registration of transfer shall
be canceled by the Regular Trustees. A transferee of a Certifi-
cate shall be entitled to the rights and subject to the obliga-
tions of a Holder hereunder upon the receipt by such transferee
of a Certificate. By acceptance of a Certificate, each trans-
feree shall be deemed to have agreed to be bound by this Declara-
tion and the documents incorporated by reference herein.
SECTION 9.3 Deemed Security Holders.
The Trustees may treat the Person in whose name any Certificate
shall be registered on the books and records of the Trust as the
sole holder of such Certificate and of the Securities represented
by such Certificate for purposes of receiving Distributions and
for all other purposes whatsoever and, accordingly, shall not be
bound to recognize any equitable or other claim to or interest in
such Certificate or in the Securities represented by such Cer-
tificate on the part of any Person, whether or not the Trust
shall have actual or other notice thereof.
SECTION 9.4 Book Entry Interests.
Unless otherwise specified in the terms of the Preferred Securi-
ties, the Preferred Securities Certificates, on original
issuance, will be issued in the form of one or more, fully regis-
tered, global Preferred Security Certificates (each a "Global
Certificate"), to be delivered to DTC, the initial Clearing
Agency, by, or on behalf of, the Trust. Such Global Certificates
shall initially be registered on the books and records of the
Trust in the name of Cede & Co., the nominee of DTC, and no
Preferred Security Beneficial Owner will receive a definitive
Preferred Security Certificate representing such Preferred
Security Beneficial Owner's interests in such Global Certifi-
cates, except as provided in Section 9.7. Unless and until
definitive, fully registered Preferred Security Certificates (the
"Definitive Preferred Security Certificates") have been issued to
the Preferred Security Beneficial Owners pursuant to Section 9.7:
(a) the provisions of this Section 9.4 shall be in full
force and effect;
(b) the Trust and the Trustees shall be entitled to deal
with the Clearing Agency for all purposes of this
Declaration (including the payment of Distributions on
the Global Certificates and receiving approvals, votes
or consents hereunder) as the Holder of the Preferred
Securities and the sole holder of the Global Certifi-
cates and shall have no obligation to the Preferred
Security Beneficial Owners;
(c) to the extent that the provisions of this Section 9.4
conflict with any other provisions of this Declaration,
the provisions of this Section 9.4 shall control; and
(d) the rights of the Preferred Security Beneficial Owners
shall be exercised only through the Clearing Agency and
shall be limited to those established by law and agree-
ments between such Preferred Security Beneficial Owners
and the Clearing Agency and/or the Clearing Agency Par-
ticipants and receive and transmit payments of Distri-
butions on the Global Certificates to such Clearing
Agency Participants. DTC will make book entry trans-
fers among the Clearing Agency Participants.
SECTION 9.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Preferred
Security Holders is required under this Declaration, unless and
until Definitive Preferred Security Certificates shall have been
issued to the Preferred Security Beneficial Owners pursuant to
Section 9.7, the Regular Trustees shall give all such notices and
communications specified herein to be given to the Preferred
Security Holders to the Clearing Agency, and shall have no notice
obligations to the Preferred Security Beneficial Owners.
SECTION 9.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Preferred Securities,
the Regular Trustees may, in their sole discretion, appoint a
successor Clearing Agency with respect to such Preferred Securi-
ties.
SECTION 9.7 Definitive Preferred Security Certificates.
If:
(a) a Clearing Agency elects to discontinue its services as
securities depositary with respect to the Preferred
Securities and a successor Clearing Agency is not
appointed within 90 days after such discontinuance
pursuant to Section 9.6; or
(b) the Regular Trustees elect after consultation with the
Sponsor to terminate the book entry system through the
Clearing Agency with respect to the Preferred Securi-
ties,
then:
(c) Definitive Preferred Security Certificates shall be
prepared by the Regular Trustees on behalf of the Trust
with respect to such Preferred Securities; and
(d) upon surrender of the Global Certificates by the Clear-
ing Agency, accompanied by registration instructions,
the Regular Trustees shall cause Definitive Certifi-
cates to be delivered to Preferred Security Beneficial
Owners in accordance with the instructions of the
Clearing Agency. Neither the Trustees nor the Trust
shall be liable for any delay in delivery of such in-
structions and each of them may conclusively rely on
and shall be protected in relying on, said instructions
of the Clearing Agency. The Definitive Preferred
Security Certificates shall be printed, lithographed or
engraved or may be produced in any other manner as is
reasonably acceptable to the Regular Trustees, as
evidenced by their execution thereof, and may have such
letters, numbers or other marks of identification
or designation and such legends or endorsements as the
Regular Trustees may deem appropriate, or as may be
required to comply with any law or with any rule or
regulation made pursuant thereto or with any rule or
regulation of any stock exchange on which Preferred
Securities may be listed, or to conform to usage.
SECTION 9.8 Mutilated, Destroyed, Lost or Stolen Certificates.
If:
(a) any mutilated Certificates should be surrendered to the
Regular Trustees, or if the Regular Trustees shall
receive evidence to their satisfaction of the destruc-
tion, loss or theft of any Certificate; and
(b) there shall be delivered to the Regular Trustees such
security or indemnity as may be required by them to
keep each of them harmless.
then:
In the absence of notice that such Certificate shall have been
acquired by a bona fide purchaser, any two Regular Trustees on
behalf of the Trust shall execute and deliver, in exchange for or
in lieu of any such mutilated, destroyed, lost or stolen Certifi-
cate, a new Certificate of like denomination. In connection with
the issuance of any new Certificate under this Section 9.8, the
Regular Trustees may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in
connection therewith. Any duplicate Certificate issued pursuant
to this Section shall constitute conclusive evidence of an
ownership interest in the relevant Securities, as if originally
issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability.
(a) Except as expressly set forth in this Declaration, the
Securities Guarantees and the terms of the Securities
the Sponsor shall not be:
(i) personally liable for the return of any portion of
the capital contributions (or any return thereon)
of the Holders of the Securities which shall be
made solely from assets of the Trust; and
(ii) be required to pay to the Trust or to any Holder
of Securities any deficit upon dissolution of the
Trust or otherwise.
(b) The Holder of the Common Securities shall be liable for
all of the debts and obligations of the Trust (other
than with respect to the Securities) to the extent not
satisfied out of the Trust's assets.
(c) Pursuant to Section 3803(a) of the Business Trust Act,
the Holders of the Preferred Securities shall be
entitled to the same limitation of personal liability
extended to stockholders of private corporations for
profit organized under the General Corporation Law of
the State of Delaware.
SECTION 10.2 Exculpation.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Trust or any
Covered Person for any loss, damage or claim incurred
by reason of any act or omission performed or omitted
by such Indemnified Person in good faith on behalf of
the Trust and in a manner such Indemnified Person
reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this
Declaration or by law, except that an Indemnified
Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's
gross negligence (or, in the case of the Property
Trustee, negligence) or willful misconduct with respect
to such acts or omissions.
(b) An Indemnified Person shall be fully protected in
relying in good faith upon the records of the Trust and
upon such information, opinions, reports or statements
presented to the Trust by any Person as to matters the
Indemnified Person reasonably believes are within such
other Person's professional or expert competence and
who has been selected with reasonable care by or on
behalf of the Trust, including information, opinions,
reports or statements as to the value and amount of the
assets, liabilities, profits, losses, or any other
facts pertinent to the existence and amount of assets
from which Distributions to Holders of Securities might
properly be paid.
SECTION 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified
Person has duties (including fiduciary duties) and lia-
bilities relating thereto to the Trust or to any other
Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any
other Covered Person for its good faith reliance on the
provisions of this Declaration. The provisions of this
Declaration, to the extent that they restrict the
duties and liabilities of an Indemnified Person other-
wise existing at law or in equity (other than the
duties imposed on the Property Trustee under the Trust
Indenture Act), are agreed by the parties hereto to
replace such other duties and liabilities of such
Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises
between an Indemnified Person and any Covered Per-
son; or
(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an
Indemnified Person shall act in a manner that is,
or provides terms that are, fair and reasonable to
the Trust or any Holder of Securities,
the Indemnified Person shall resolve such conflict of
interest, take such action or provide such terms,
considering in each case the relative interest of each
party (including its own interest) to such conflict,
agreement, transaction or situation and the benefits
and burdens relating to such interests, any customary
or accepted industry practices, and any applicable gen-
erally accepted accounting practices or principles. In
the absence of bad faith by the Indemnified Person, the
resolution, action or term so made, taken or provided
by the Indemnified Person shall not constitute a breach
of this Declaration or any other agreement contemplated
herein or of any duty or obligation of the Indemnified
Person at law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is
permitted or required to make a decision
(i) in its "discretion" or under a grant of similar
authority, the Indemnified Person shall be
entitled to consider such interests and factors as
it desires, including its own interests, and shall
have no duty or obligation to give any considera-
tion to any interest of or factors affecting the
Trust or any other Person; or
(ii) in its "good faith" or under another express stan-
dard, the Indemnified Person shall act under such
express standard and shall not be subject to any
other or different standard imposed by this
Declaration or by applicable law.
SECTION 10.4 Indemnification.
(a) To the fullest extent permitted by applicable law, the
Sponsor shall indemnify and hold harmless each Indemni-
fied Person from and against any loss, damage, lia-
bility, tax, penalty, expense or claim of any kind or
nature whatsoever incurred by such Indemnified Person
by reason of the creation, operation or termination of
the Trust or any act or omission performed or omitted
by such Indemnified Person in good faith on behalf of
the Trust and in a manner such Indemnified Person
reasonably believed to be within the scope of authority
conferred on such Indemnified Person by this Declara-
tion, except that no Indemnified Person shall be
entitled to be indemnified in respect of any loss,
damage or claim incurred by such Indemnified Person by
reason of gross negligence (or, in the case of the
Property Trustee, negligence) or willful misconduct with
respect to such acts or omissions.
(b) To the fullest extent permitted by applicable law,
expenses (including legal fees) incurred by an Indemni-
fied Person in defending any claim, demand, action,
suit or proceeding shall, from time to time, be ad-
vanced by the Sponsor prior to the final disposition of
such claim, demand, action, suit or proceeding upon
receipt by the Sponsor of an undertaking by or on
behalf of the Indemnified Person to repay such amount
if it shall be determined that the Indemnified Person
is not entitled to be indemnified as authorized in
Section 10.4(a). The indemnification shall survive the
termination of this Declaration.
SECTION 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Debenture Issuer, the
Delaware Trustee and the Property Trustee may engage in or
possess an interest in other business ventures of any nature or
description, independently or with others, similar or dissimilar
to the business of the Trust, and the Trust and the Holders of
Securities shall have no rights by virtue of this Declaration in
and to such independent ventures or the income or profits derived
therefrom and the pursuit of any such venture, even if competi-
tive with the business of the Trust, shall not be deemed wrongful
or improper. No Covered Person, the Sponsor, the Debenture
Issuer, the Delaware Trustee, or the Property Trustee shall be
obligated to present any particular investment or other oppor-
tunity to the Trust even if such opportunity is of a character
that, if presented to the Trust, could be taken by the Trust, and
any Covered Person, the Sponsor, the Debenture Issuer, the
Delaware Trustee and the Property Trustee shall have the right to
take for its own account (individually or as a partner or fidu-
ciary) or to recommend to others any such particular investment
or other opportunity. Any Covered Person, the Delaware Trustee
and the Property Trustee may engage or be interested in any
financial or other transaction with the Sponsor or any Affiliate
of the Sponsor, or may act as depositary for, trustee or agent
for, or act on any committee or body of holders of, securities or
other obligations of the Sponsor or its Affiliates.
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the calen-
dar year, or such other year as is required by the Code.
SECTION 11.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the
Regular Trustees shall keep, or cause to be kept, full
books of account, records and supporting documents,
which shall reflect in reasonable detail, each transac-
tion of the Trust. The books of account shall be main-
tained on the accrual method of accounting, in
accordance with generally accepted accounting princi-
ples, consistently applied. The Trust shall use the
accrual method of accounting for United States federal
income tax purposes. The books of account and the
records of the Trust shall be examined by and reported
upon as of the end of each Fiscal Year by a firm of
independent certified public accountants selected by
the Regular Trustees.
(b) The Regular Trustees shall cause to be prepared and de-
livered to each of the Holders of Securities, within 90
days after the end of each Fiscal Year of the Trust,
annual financial statements of the Trust, including a
balance sheet of the Trust as of the end of such Fiscal
Year, and the related statements of income or loss.
(c) The Regular Trustees shall cause to be duly prepared
and delivered to each of the Holders of Securities, any
annual United States federal income tax information
statement, required by the Code, containing such infor-
mation with regard to the Securities held by each
Holder as is required by the Code and the Treasury
Regulations. Notwithstanding any right under the Code
to deliver any such statement at a later date, the
Regular Trustees shall endeavor to deliver all such
statements within 30 days after the end of each Fiscal
Year of the Trust.
(d) The Regular Trustees shall cause to be duly prepared
and filed with the appropriate taxing authority, an
annual United States federal income tax return, on a
Form 1041 or such other form required by United States
federal income tax law, and any other annual income tax
returns required to be filed by the Regular Trustees on
behalf of the Trust with any state or local taxing
authority.
SECTION 11.3 Banking.
The Trust shall maintain one or more bank accounts in the name
and for the sole benefit of the Trust; provided, however, that
_________________
all payments of funds in respect of the Debentures held by the
Property Trustee shall be made directly to the Property Trustee
Account and no other funds of the Trust shall be deposited in the
Property Trustee Account. The signatories for such accounts
shall be designated by the Regular Trustees; provided, however,
_________________
that the Property Trustee shall designate the sole signatories
for the Property Trustee Account.
SECTION 11.4 Withholding.
The Trust and the Regular Trustees shall comply with all with-
holding requirements under United States federal, state and local
law. The Trust shall request, and the Holders shall provide to
the Trust, such forms or certificates as are necessary to estab-
lish an exemption from withholding with respect to each Holder,
and any representations and forms as shall reasonably be
requested by the Trust to assist it in determining the extent of,
and in fulfilling, its withholding obligations. The Regular
Trustee shall file required forms with applicable jurisdictions
and, unless an exemption from withholding is properly established
by a Holder, shall remit amounts withheld with respect to the
Holder to applicable jurisdictions. To the extent that the Trust
is required to withhold and pay over any amounts to any authority
with respect to distributions or allocations to any Holder, the
amount withheld shall be deemed to be a distribution in the
amount of the withholding to the Holder. In the event of any
claimed over withholding, Holders shall be limited to an action
against the applicable jurisdiction. If the amount required to be
withheld was not withheld from actual Distributions made, the Trust
may reduce subsequent Distributions by the amount of such
withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments.
(a) Except as otherwise provided in this Declaration or by
any applicable terms of the Securities, this Declaration
may only be amended by a written instrument approved and
executed by:
(i) the Regular Trustees (or, if there are more than
two Regular Trustees a majority of the Regular
Trustees);
(ii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Property
Trustee, the Property Trustee; and
(iii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Delaware
Trustee, the Delaware Trustee;
(b) No amendment shall be made, and any purported amendment
shall be void and ineffective:
(i) unless, in the case of any proposed amendment, the
Property Trustee shall have first received an
Officers' Certificate from each of the Trust and
the Sponsor that such amendment is permitted by,
and conforms to, the terms of this Declaration
(including the terms of the Securities);
(ii) unless, in the case of any proposed amendment
which affects the rights, powers, duties, obliga-
tions or immunities of the Property Trustee, the
Property Trustee shall have first received:
(A) an Officers' Certificate from each of the
Trust and the Sponsor that such amendment is
permitted by, and conforms to, the terms of
this Declaration (including the terms of the
Securities); and
(B) an opinion of counsel (who may be counsel to
the Sponsor or the Trust) that such amendment
is permitted by, and conforms to, the terms
of this Declaration (including the terms of
the Securities); and
(iii) to the extent the result of such amendment would
be to:
(A) cause the Trust to fail to continue to be
classified for purposes of United States
federal income taxation as a grantor trust;
(B) reduce or otherwise adversely affect the
powers of the Property Trustee in
contravention of the Trust Indenture Act; or
(C) cause the Trust to be deemed to be an
Investment Company required to be registered
under the Investment Company Act.
(c) at such time after the Trust has issued any Securities
that remain outstanding, any amendment that would
adversely affect the rights, privileges or preferences
of any Holder of Securities may be effected only with
such additional requirements as may be set forth in the
terms of such Securities;
(d) Section 9.1(c) and this Section 12.1 shall not be
amended without the consent of all of the Holders of the
Securities;
(e) Article IV shall not be amended without the consent of
the Holders of a Majority in liquidation amount of the
Common Securities and;
(f) the rights of the holders of the Common Securities under
Article V to increase or decrease the number of, and
appoint and remove Trustees shall not be amended without
the consent of the Holders of a Majority in liquidation
amount of the Common Securities; and
(g) notwithstanding Section 12.1(c), this Declaration may be
amended without the consent of the Holders of the
Securities to:
(i) cure any ambiguity;
(ii) correct or supplement any provision in this
Declaration that may be defective or inconsistent
with any other provision of this Declaration;
(iii) add to the covenants, restrictions or obligations
of the Sponsor; and
(iv) conform to any change in Rule 3a-7 or written
change in interpretation or application of Rule
3a-7 by any legislative body, court, government
agency or regulatory authority which amendment
does not have a material adverse effect on the
right, preferences or privileges of the Holders.
SECTION 12.2 Meetings of the Holders of Securities; Action by
Written Consent.
(a) Meetings of the Holders of any class of Securities may
be called at any time by the Regular Trustees (or as
provided in the terms of the Securities) to consider
and act on any matter on which Holders of such class of
Securities are entitled to act under the terms of this
Declaration, the terms of the Securities or the rules
of any stock exchange on which the Preferred Securities
are listed or admitted for trading. The Regular
Trustees shall call a meeting of the Holders of such
class if directed to do so by the Holders of at least
10% in liquidation amount of such class of Securities.
Such direction shall be given by delivering to the
Regular Trustees one or more calls in a writing stating
that the signing Holders of Securities wish to call a
meeting and indicating the general or specific purpose
for which the meeting is to be called. Any Holders of
Securities calling a meeting shall specify in writing
the Security Certificates held by the Holders of
Securities exercising the right to call a meeting and
only those Securities specified shall be counted for
purposes of determining whether the required percentage
set forth in the second sentence of this paragraph has
been met.
(b) Except to the extent otherwise provided in the terms of
the Securities, the following provisions shall apply to
meetings of Holders of Securities:
(i) notice of any such meeting shall be given to
all the Holders of Securities having a right to
vote thereat at least 7 days and not more than 60
days before the date of such meeting. Whenever a
vote, consent or approval of the Holders of
Securities is permitted or required under this
Declaration or the rules of any stock exchange on
which the Preferred Securities are listed or
admitted for trading, such vote, consent or ap-
proval may be given at a meeting of the Holders
of Securities. Any action that may be taken at a
meeting of the Holders of Securities may be taken
without a meeting if a consent in writing setting
forth the action so taken is signed by the
Holders of Securities owning not less than the
minimum amount of Securities in liquidation
amount that would be necessary to authorize or
take such action at a meeting at which all
Holders of Securities having a right to vote
thereon were present and voting. Prompt notice
of the taking of action without a meeting
shall be given to the Holders of Securities
entitled to vote who have not consented in
writing. The Regular Trustees may specify
that any written ballot submitted to the Security
Holder for the purpose of taking any action with-
out a meeting shall be returned to the Trust
within the time specified by the Regular
Trustees;
(ii) each Holder of a Security may authorize any
Person to act for it by proxy on all matters in
which a Holder of Securities is entitled to
participate, including waiving notice of any
meeting, or voting or participating at a meeting.
No proxy shall be valid after the expiration of
11 months from the date thereof unless otherwise
provided in the proxy. Every proxy shall be
revocable at the pleasure of the Holder of
Securities executing it. Except as otherwise
provided herein, all matters relating to the
giving, voting or validity of proxies shall be
governed by the General Corporation Law of the
State of Delaware relating to proxies, and
judicial interpretations thereunder, as if the
Trust were a Delaware corporation and the Holders
of the Securities were stockholders of a Delaware
corporation;
(iii) each meeting of the Holders of the Securities
shall be conducted by the Regular Trustees or by
such other Person that the Regular Trustees may
designate; and
(iv) unless the Business Trust Act, this Declaration,
the terms of the Securities, the Trust Indenture
Act or the listing rules of any stock exchange on
which the Preferred Securities are then listed or
trading, otherwise provides, the Regular Trustees,
in their sole discretion, shall establish all other
provisions relating to meetings of Holders of
Securities, including notice of the time, place or
purpose of any meeting at which any matter is to be
voted on by any Holders of Securities, waiver of
any such notice, action by consent without a
meeting, the establishment of a record date, quorum
requirements, voting in person or by proxy or any
other matter with respect to the exercise of any
such right to vote.
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
SECTION 13.1 Representations and Warranties of Property Trustee.
The Trustee that acts as initial Property Trustee represents and
warrants to the Trust and to the Sponsor at the date of this
Declaration, and each Successor Property Trustee represents and
warrants to the Trust and the Sponsor at the time of the Succes-
sor Property Trustee's acceptance of its appointment as Property
Trustee that:
(a) The Property Trustee is a Delaware banking corporation
with trust powers, duly organized, validly existing and
in good standing under the laws of the United States,
with trust power and authority to execute and deliver,
and to carry out and perform its obligations under the
terms of, the Declaration.
(b) The execution, delivery and performance by the Property
Trustee of the Declaration has been duly authorized by
all necessary corporate action on the part of the
Property Trustee. The Declaration has been duly exe-
cuted and delivered by the Property Trustee, and it
constitutes a legal, valid and binding obligation
of the Property Trustee, enforceable against it in
accordance with its terms, subject to applicable bank-
ruptcy, reorganization, moratorium, insolvency, and
other similar laws affecting creditors' rights
generally and to general principles of equity and the
discretion of the court (regardless of whether the
enforcement of such remedies is considered in a pro-
ceeding in equity or at law).
(c) The execution, delivery and performance of the Declara-
tion by the Property Trustee does not conflict with or
constitute a breach of the Articles of Organization or
By-laws of the Property Trustee.
(d) No consent, approval or authorization of, or registra-
tion with or notice to, any State or Federal banking
authority is required for the execution, delivery or
performance by the Property Trustee, of the Declara-
tion.
(e) If the Property Trustee does not also act as the
Delaware Trustee, the Delaware Trustee shall be a
natural person who is a resident of the State of
Delaware.
(f) The Delaware Trustee has been authorized to perform its
obligations under the Certificate of Trust and the
Declaration. The Declaration under Delaware law con-
stitutes a legal, valid and binding obligation of the
Delaware Trustee, enforceable against it in accordance
with its terms, subject to applicable bankruptcy, reor-
ganization, moratorium, insolvency, and other similar
laws affecting creditors' rights generally and to
general principles of equity and the discretion of the
court (regardless of whether the enforcement of such
remedies is considered in a proceeding in equity or at
law).
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices.
All notices provided for in this Declaration shall be in writing,
duly signed by the party giving such notice, and shall be deliv-
ered, telecopied or mailed by registered or certified mail, as
follows:
(a) if given to the Trust, in care of the Regular Trustees
at the Trust's mailing address set forth below (or such
other address as the Trust may give notice of to the
Holders of the Securities):
SOUTHERN UNION FINANCING I
504 Lavaca Street, Suite 800
Austin, Texas 78701
Attention: [ ]
(b) if given to the Property Trustee, at the mailing ad-
dress set forth below (or such other address as the
Property Trustee may give notice of to the Holders of
the Securities):
WILMINGTON TRUST COMPANY
1100 N. Market Street
Wilmington, Delaware 19890
Attention: Corporate Trust Administration
(c) if given to the Holder of the Common Securities, at the
mailing address of the Sponsor set forth below (or such
other address as the Holder of the Common Securities
may give notice to the Trust):
SOUTHERN UNION COMPANY
504 Lavaca Street
Austin, Texas 78701
Attention: [ ]
(d) if given to any other Holder, at the address set forth
on the books and records of the Trust.
All such notices shall be deemed to have been given when received
in person, telecopied with receipt confirmed, or mailed by first
class mail, postage prepaid except that if a notice or other
document is refused delivery or cannot be delivered because of a
changed address of which no notice was given, such notice or
other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 14.2 Governing Law.
This Declaration and the rights of the parties hereunder shall be
governed by and interpreted in accordance with the laws of the
State of Delaware and all rights and remedies shall be governed
by such laws without regard to principles of conflict of laws.
SECTION 14.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust not be
characterized for United States federal income tax purposes as an
association taxable as a corporation or a partnership but rather
that the Trust be characterized as a grantor trust or otherwise in
a manner such that each Holder of Securities will be treated as
owning an undivided beneficial interest in the Debentures. The
provisions of this Declaration shall be interpreted to further this
intention of the parties.
SECTION 14.4 Headings.
Headings contained in this Declaration are inserted for conveni-
ence of reference only and do not affect the interpretation of
this Declaration or any provision hereof.
SECTION 14.5 Successors and Assigns
Whenever in this Declaration any of the parties hereto is named
or referred to, the successors and assigns of such party shall be
deemed to be included, and all covenants and agreements in this
Declaration by the Sponsor and the Trustees shall bind and inure
to the benefit of their respective successors and assigns,
whether so expressed.
SECTION 14.6 Partial Enforceability.
If any provision of this Declaration, or the application of such
provision to any Person or circumstance, shall be held invalid,
the remainder of this Declaration, or the application of such
provision to persons or circumstances other than those to which
it is held invalid, shall not be affected thereby.
SECTION 14.7 Counterparts.
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the
affixing of the signature of each of the Trustees to one of such
counterpart signature pages. All of such counterpart signature
pages shall be read as though one, and they shall have the same
force and effect as though all of the signers had signed a single
signature page.
<PAGE>
IN WITNESS WHEREOF, the undersigned has caused these presents to
be executed as of the day and year first above written.
Ronald J. Endres
as Trustee
RONALD J. ENDRES
___________________________
David J. Kvapil
as Trustee
DAVID J. KVAPIL
___________________________
WILMINGTON TRUST COMPANY
as Delaware Trustee
By:
Name:
Title:
SOUTHERN UNION COMPANY, Inc.
as Sponsor
By:
Name:
Title:
<PAGE>
EXHIBIT A
TERMS OF
__% TRUST ORIGINATED PREFERRED SECURITIES
__% TRUST ORIGINATED COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated Declaration
of Trust, dated as of __________________, 1995 (as amended from
time to time, the "Declaration"), the designation, rights, privi-
leges, restrictions, preferences and other terms and provisions
of the Preferred Securities and the Common Securities are set out
below (each capitalized term used but not defined herein has the
meaning set forth in the Declaration or, if not defined in such
Declaration, as defined in the Prospectus referred to below):
1. Designation and Number.
(a) "Preferred Securities." Preferred Securities of the
Trust with an aggregate liquidation amount with respect
to the assets of the Trust of $[____________ million
($ )] and a liquidation amount with respect
to the assets of the Trust of $25 per Preferred
Security, are hereby designated for the purposes of
identification only as "_____% Trust Originated Pre-
ferred Securities" (the "Preferred Securities"). The
Preferred Security Certificates evidencing the Pre-
ferred Securities shall be substantially in the form
attached hereto as Annex I, with such changes and addi-
tions thereto or deletions therefrom as may be required
by ordinary usage, custom or practice or to conform to
the rules of any stock exchange on which the Preferred
Securities are listed.
(b) "Common Securities." Common Securities of the Trust
with an aggregate liquidation amount with respect to
the assets of the Trust of $[_______ million ($ )]
and a liquidation amount with respect to the assets of
the Trust of $25 per Common Security, are hereby
designated for the purposes of identification only as
"____% Trust Originated Common Securities" (the "Common
Securities"). The Common Security Certificates
evidencing the Common Securities shall be substantially
in the form attached hereto as Annex II, with such
changes and additions thereto or deletions therefrom as
may be required by ordinary usage, custom or practice.
2. Distributions.
(a) Distributions payable on each Security will be fixed at
a rate per annum of [*.*]% (the "Coupon Rate") of the
stated liquidation amount of $25 per Security, such
rate being the rate of interest payable on the Deben-
tures to be held by the Property Trustee. Distribu-
tions in arrears for more than one quarter will bear
interest thereon compounded quarterly at the Coupon
Rate (to the extent permitted by applicable law). The
term "Distributions" as used herein includes such cash
distributions and any such interest payable unless
otherwise stated. A Distribution is payable only to
the extent that payments are made in respect of the
Debentures held by the Property Trustee. The amount of
Distributions payable for any period will be computed
for any full quarterly Distribution period on the basis
of a 360-day year of twelve 30-day months, and for any
period shorter than a full quarterly Distribution
period for which Distributions are computed, Distribu-
tions will be computed on the basis of the actual
number of days elapsed per 30-day month.
(b) Distributions on the Securities will be cumulative,
will accrue from , 1995, and will be payable
quarterly in arrears, on March 31, June 30, Septem
ber 30, and December 31 of each year, commencing on
__________________, 1995, except as otherwise described
below. The Debenture Issuer has the right under the
Indenture to defer payments of interest by extending
the interest payment period from time to time on the
Debentures for a period not exceeding 20 consecutive
quarters (each an "Extension Period") and, during such
Extension Period, Distributions will also be deferred.
Despite such deferral, quarterly Distributions will
continue to accrue with interest thereon (to the extent
permitted by applicable law) at the Coupon Rate
compounded quarterly during any such Extension Period.
Prior to the termination of any such Extension Period,
the Debenture Issuer may further extend such Extension
Period; provided that such Extension Period together
_____________
with all such previous and further extensions thereof may
not exceed 20 consecutive quarters. Payments of accrued
Distributions will be payable to Holders as they appear
on the books and records of the Trust on the first record
date after the end of the Extension Period. Upon the
termination of any Extension Period and the payment of
all amounts then due, the Debenture Issuer may commence
a new Extension Period, subject to the above require-
ments.
(c) Distributions on the Securities will be payable to the
Holders thereof as they appear on the books and records
of the Trust on the relevant record dates. While the
Preferred Securities remain in book-entry only form,
the relevant record dates shall be one Business Day
prior to the relevant payment dates which payment dates
correspond to the interest payment dates on the Deben-
tures. Subject to any applicable laws and regulations
and the provisions of the Declaration, each such pay-
ment in respect of the Preferred Securities will be
made as described under the heading "Description of the
Preferred Securities -- Book-Entry Only Issuance -- The
Depository Trust Company" in the Prospectus Supplement
dated ______, 1995, to the Prospectus dated ______,
1995 (together, the "Prospectus"), of the Trust
included in the Registration Statement on Form S-3 of
the Sponsor, the Trust and certain other business trusts.
The relevant record dates for the Common Securities shall
be the same record date as for the Preferred Securities.
If the Preferred Securities shall not continue to remain
in book-entry only form, the relevant record dates for
the Preferred Securities, shall conform to the rules of
any securities exchange on which the securities are
listed and, if none, shall be selected by the Regular
Trustees, which dates shall be at least one Business Day
but less than 60 Business Days before the relevant
payment dates, which payment dates correspond to the
interest payment dates on the Debentures. Distributions
payable on any Securities that are not punctually paid on
any Distribution payment date, as a result of the
Debenture Issuer having failed to make a payment under
the Debentures, will cease to be payable to the Person in
whose name such Securities are registered on the relevant
record date, and such defaulted Distribution will
instead be payable to the Person in whose name such
Securities are registered on the special record date or
other specified date determined in accordance with the
Indenture. If any date on which Distributions are pay-
able on the Securities is not a Business Day, then pay-
ment of the Distribution payable on such date will be
made on the next succeeding day that is a Business Day
(and without any interest or other payment in respect
of any such delay) except that, if such Business Day is
in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if
made on such date.
(d) In the event that there is any money or other property
held by or for the Trust that is not accounted for
hereunder, such property shall be distributed Pro Rata
(as defined herein) among the Holders of the Securi-
ties.
3. Liquidation Distribution Upon Dissolution.
In the event of any voluntary or involuntary dissolution,
winding-up or termination of the Trust, the Holders of the
Securities on the date of the dissolution, winding-up or termina-
tion, as the case may be, will be entitled to receive out of the
assets of the Trust available for distribution to Holders of
Securities after satisfaction of liabilities of creditors an
amount equal to the aggregate of the stated liquidation amount of
$25 per Security plus accrued and unpaid Distributions thereon to
the date of payment (such amount being the "Liquidation Distribu-
tion"), unless, in connection with such dissolution, winding-up
or termination, Debentures in an aggregate principal amount equal
to the aggregate stated liquidation amount of such Securities,
with an interest rate equal to the Coupon Rate of, and bearing
accrued and unpaid interest in an amount equal to the accrued and
unpaid Distributions on, such Securities, shall be distributed on
a Pro Rata basis to the Holders of the Securities in exchange for
such Securities.
If, upon any such dissolution, the Liquidation Distribution can
be paid only in part because the Trust has insufficient assets
available to pay in full the aggregate Liquidation Distribution,
then the amounts payable directly by the Trust on the Securities
shall be paid on a Pro Rata basis.
4. Redemption and Distribution.
(a) Upon the repayment of the Debentures in whole or in
part, whether at maturity or upon redemption, the pro-
ceeds from such repayment or payment shall be simulta-
neously applied to redeem Securities having an
aggregate liquidation amount equal to the aggregate
principal amount of the Debentures so repaid or re-
deemed at a redemption price of $25 per Security plus
an amount equal to accrued and unpaid Distributions
thereon at the date of the redemption, payable in cash
(the "Redemption Price"). Holders will be given not
less than 30 nor more than 60 days notice of such
redemption.
(b) If fewer than all the outstanding Securities are to be
so redeemed, the Common Securities and the Preferred
Securities will be redeemed Pro Rata and the Preferred
Securities to be redeemed will be as described in
Paragraph 4(f)(ii) below.
(c) If a Tax Event (as defined below) shall occur and be
continuing the Regular Trustees shall dissolve the
Trust and, after satisfaction of creditors, cause
Debentures held by the Property Trustee, having an
aggregate principal amount equal to the aggregate
stated liquidation amount of, with an interest rate
identical to the Coupon Rate of, and accrued and unpaid
interest equal to accrued and unpaid Distributions on
and having the same record date for payment as the
Securities, to be distributed to the Holders of the
Securities in liquidation of such Holders' interests in
the Trust on a Pro Rata basis, within 90 days following
the occurrence of such Tax Event (the "90 Day Period");
provided, however, that, as a condition of such disso-
____________________
lution and distribution, the Regular Trustees shall
have received an opinion of a nationally recognized
independent tax counsel experienced in such matters (a
"No Recognition Opinion"), which opinion may rely on
published revenue rulings of the Internal Revenue Ser-
vice, to the effect that the Holders of the Securities
will not recognize any gain or loss for United States
federal income tax purposes as a result of the disso-
lution of the Trust and the distribution of Debentures,
and provided, further, that, if at the time there is
__________________
available to the Trust the opportunity to eliminate,
within the 90 Day Period, the Tax Event by taking some
ministerial action, such as filing a form or making an
election, or pursuing some other similar reasonable
measure that has no adverse effect on the Trust, the
Debenture Issuer, the Sponsor or the Holders of the
Securities ("Ministerial Action"), the Trust will
pursue such Ministerial Action in lieu of dissolution.
If after receipt of a Dissolution Tax Opinion by the
Regular Trustees (i) the Debenture Issuer has received
an opinion (a "Redemption Tax Opinion") of a nationally
recognized independent tax counsel experienced in such
matters that, as a result of a Tax Event, there is more
than an insubstantial risk that the Debenture Issuer
would be precluded from deducting the interest on the
Debentures for United States federal income tax pur-
poses even if the Debentures were distributed to the
Holders of Securities in liquidation of such Holders'
interests in the Trust as described in this paragraph
4(c), or (ii) the Regular Trustees shall have been in-
formed by such tax counsel that a No Recognition
Opinion cannot be delivered to the Trust, the Debenture
Issuer shall have the right at any time, upon not less
than 30 nor more than 60 days notice, to redeem the
Debentures in whole or in part for cash within 90 days
following the occurrence of such Tax Event, and, fol-
lowing such redemption, Securities with an aggregate
liquidation amount equal to the aggregate principal
amount of the Debentures so redeemed shall be redeemed
by the Trust at the Redemption Price on a Pro Rata
basis; provided, however, that, if at the time there is
_________________
available to the Trust the opportunity to eliminate,
within such 90 day period, the Tax Event by taking some
Ministerial Action, the Trust or the Debenture Issuer
will pursue such Ministerial Action in lieu of redemp-
tion.
"Tax Event" means that the Regular Trustees shall have
received an opinion of a nationally recognized inde-
pendent tax counsel experienced in such matters (a
"Dissolution Tax Opinion") to the effect that on or
after the date of the Prospectus Supplement, as a
result of (a) any amendment to, or change (including
any announced prospective change) in, the laws (or any
regulations thereunder) of the United States or any
political subdivision or taxing authority therefore or
therein, or (b) any amendment to, or change in, an
interpretation or application of any such laws or
regulations by any legislative body, court, govern-
mental agency or regulatory authority, which amendment
or change is enacted, promulgated, issued or announced
or which interpretation or pronouncement is issued or
announced or which action is taken, in each case on or
after the date of the Prospectus Supplement, there is
more than an insubstantial risk that (i) the Trust is
or will be within 90 days of the date thereof, subject
to United States federal income tax with respect to
interest accrued or received on the Debentures, (ii)
the Trust is, or will be within 90 days of the date
thereof, subject to more than a de minimis amount of
taxes, duties or other governmental charges, or (iii)
interest payable by the Debenture Issuer to the Trust
on the Debentures is not, or within 90 days of the date
thereof will not be, deductible, in whole or in part,
by the Debenture Issuer for United States federal
income tax purposes.
On and from the date fixed by the Regular Trustees for
any distribution of Debentures and dissolution of the
Trust: (i) the Securities will no longer be deemed to
be outstanding, (ii) The Depository Trust Company (the
"Depository") or its nominee (or any successor Clearing
Agency or its nominee), as the record Holder of the
Preferred Securities, will receive a registered global
certificate or certificates representing the Debentures
to be delivered upon such distribution and any certifi-
cates representing Securities, except for certificates
representing Preferred Securities held by the Deposi-
tory or its nominee (or any successor Clearing Agency
or its nominee), will be deemed to represent beneficial
interests in the Debentures having an aggregate princi-
pal amount equal to the aggregate stated liquidation
amount of, with an interest rate identical to the
Coupon Rate of, and accrued and unpaid interest equal
to accrued and unpaid Distributions on such Securities
until such certificates are presented to the Debenture
Issuer or its agent for transfer or reissue.
(d) The Trust may not redeem fewer than all the outstanding
Securities unless all accrued and unpaid Distributions
have been paid on all Securities for all quarterly
Distribution periods terminating on or before the date
of redemption.
(e) If the Debentures are distributed to holders of the
Securities, pursuant to the terms of the Indenture, the
Debenture Issuer will use its best efforts to have the
Debentures listed on the New York Stock Exchange or on
such other exchange as the Preferred Securities were
listed immediately prior to the distribution of the
Debentures.
(f) "Redemption or Distribution Procedures."
(i) Notice of any redemption of, or notice of distri-
bution of Debentures in exchange for the Securi-
ties (a "Redemption/Distribution Notice") will be
given by the Trust by mail to each Holder of
Securities to be redeemed or exchanged not fewer
than 30 nor more than 60 days before the date
fixed for redemption or exchange thereof which,
in the case of a redemption, will be the date
fixed for redemption of the Debentures. For pur-
poses of the calculation of the date of redemp-
tion or exchange and the dates on which notices
are given pursuant to this paragraph 4(f)(i), a
Redemption/Distribution Notice shall be deemed to
be given on the day such notice is first mailed
by first-class mail, postage prepaid, to Holders
of Securities. Each Redemption/Distribution
Notice shall be addressed to the Holders of
Securities at the address of each such Holder
appearing in the books and records of the Trust.
No defect in the Redemption/Distribution Notice
or in the mailing of either thereof with respect
to any Holder shall affect the validity of the
redemption or exchange proceedings with respect
to any other Holder.
(ii) In the event that fewer than all the outstanding
Securities are to be redeemed, the Securities to
be redeemed shall be redeemed Pro Rata and, in
the event Preferred Securities are held in book-
entry only form by the Depositary or its nominee
(or any successor Clearing Agency or its nomi-
nee), the Depositary will reduce Pro Rata the
amount of the interest of each Clearing Agency
Participant in the Preferred Securities to be
redeemed; provided that if, as a result of such
Pro Rata redemption, Clearing Agency Participants
would hold fractional interests in the Preferred
Securities, the Depositary will adjust the amount
of the interest of each Clearing Agency Partici-
pant to be redeemed to avoid such fractional
interests.
(iii) If Securities are to be redeemed and the Trust
gives a Redemption/Distribution Notice, which
notice may only be issued if the Debentures are
redeemed as set out in this paragraph 4 (which
notice will be irrevocable), then (A) while the
Preferred Securities are in book-entry only form,
with respect to the Preferred Securities, by
12:00 noon, New York City time, on the redemption
date, provided that the Debenture Issuer has paid
the Property Trustee a sufficient amount of cash
in connection with the related redemption or
maturity of the Debentures, the Property Trustee
will deposit irrevocably with the Depositary (or
successor Clearing Agency) funds sufficient to
pay the applicable Redemption Price with respect
to the Preferred Securities and will give the
Depository irrevocable instructions and authority
to pay the Redemption Price to the Holders of the
Preferred Securities, and (B) with respect to
Preferred Securities issued in definitive form
and Common Securities, provided that the Deben-
ture Issuer has paid the Property Trustee a
sufficient amount of cash in connection with the
related redemption or maturity of the Debentures,
the Property Trustee will pay the relevant Re-
demption Price to the Holders of such Securities
by check mailed to the address of the relevant
Holder appearing on the books and records of the
Trust on the redemption date. If a Redemption/
Distribution Notice shall have been given and
funds deposited as required, if applicable, then
immediately prior to the close of business on the
date of such deposit, or on the redemption date,
as applicable, distributions will cease to accrue
on the Securities so called for redemption and
all rights of Holders of such Securities so
called for redemption will cease, except the
right of the Holders of such Securities to
receive the Redemption Price, but without inter-
est on such Redemption Price. Neither the Regu-
lar Trustees nor the Trust shall be required to
register or cause to be registered the transfer
of any Securities that have been so called for
redemption. If any date fixed for redemption of
Securities is not a Business Day, then payment of
the Redemption Price payable on such date will be
made on the next succeeding day that is a Busi-
ness Day (and without any interest or other pay-
ment in respect of any such delay) except that,
if such Business Day falls in the next calendar
year, such payment will be made on the immedi-
ately preceding Business Day, in each case with
the same force and effect as if made on such date
fixed for redemption. If payment of the Redem-
demption Price in respect of any Securities is
improperly withheld or refused and not paid
either by the Property Trustee or by the Sponsor
as guarantor pursuant to the relevant Securities
Guarantee, Distributions on such Securities will
continue to accrue from the original redemption
date to the actual date of payment, in which case
the actual payment date will be considered the
date fixed for redemption for purposes of calcu-
lating the Redemption Price.
(iv) Redemption/Distribution Notices shall be sent
by the Regular Trustees on behalf of the Trust to
(A) in respect of the Preferred Securities, the
Depositary or its nominee (or any successor
Clearing Agency or its nominee) if the Global
Certificates have been issued or, if Definitive
Preferred Security Certificates have been issued,
to the Holder thereof, and (B) in respect of the
Common Securities to the Holder thereof.
(v) Subject to the foregoing and applicable law
(including, without limitation, United States
federal securities laws), provided the acquiror
is not the Holder of the Common Securities or the
obligor under the Indenture, the Sponsor or any
of its subsidiaries may at any time and from time
to time purchase outstanding Preferred Securities
by tender, in the open market or by private
agreement.
5. Voting Rights - Preferred Securities.
(a) Except as provided under paragraphs 5(b) and 7 and as
otherwise required by law and the Declaration, the
Holders of the Preferred Securities will have no voting
rights.
(b) If (i) the Trust fails to make Distributions in full on
the Preferred Securities for 6 consecutive quarterly
Distribution periods, or (ii) an Event of Default
occurs and is continuing (each of (i) and (ii) being an
"Appointment Event"), then the Holders of the Preferred
Securities, acting as a single class, will be entitled
by the vote of a Majority in liquidation amount of the
Preferred Securities to appoint a Special Regular
Trustee in accordance with Section 5.6(a)(ii)(B) of the
Declaration. Any Holder of Preferred Securities (other
than the Sponsor, or any entity directly or indirectly
controlling or controlled by or under direct or indi-
rect common control with the Sponsor) will be entitled
to nominate any person to be appointed as Special
Regular Trustee. For purposes of determining whether
the Trust has failed to make Distributions in full for
6 consecutive quarterly Distribution periods, Distribu-
tions shall be deemed to remain in arrears, notwith-
standing any payments in respect thereof, until full
cumulative Distributions have been or contemporaneously
are paid with respect to all quarterly Distribution
periods terminating on or prior to the date of payment
of such cumulative Distributions. Not later than 30
days after such right to appoint a Special Regular
Trustee arises, the Regular Trustees will convene a
meeting for the purpose of appointing a Special Regular
Trustee. If the Regular Trustees fail to convene
such meeting within such 30-day period, the Holders of
10% in liquidation amount of the Preferred Securities
will be entitled to convene such meeting in accordance
with Section 12.2 of the Declaration. The record date
for such meeting will be the close of business on the
Business Day that is one Business Day before the day on
which notice of the meeting is sent to the Holders.
The provisions of the Declaration relating to the con-
vening and conduct of the meetings of the Holders will
apply with respect to any such meeting.
A Special Regular Trustee may be removed without cause
at any time by vote of the Holders of a Majority in
liquidation amount of the Preferred Securities at a
meeting of the Holders of the Preferred Securities in
accordance with Section 5.6(a)(ii)(B) of the Declara-
tion. The Holders of 10% in liquidation amount of the
Preferred Securities will be entitled to convene such a
meeting in accordance with Section 12.2 of the Declara-
tion. The record date for such meeting will be the
close of business on the Business Day which is one
Business Day before the day on which the notice of
meeting is sent to Holders. Notwithstanding the
appointment of a Special Regular Trustee, the Debenture
Issuer shall retain all rights under the Indenture,
including the right to extend the interest payment
period on the Debentures.
Subject to the requirements set forth in this para-
graph, the Holders of a majority in liquidation amount
of the Preferred Securities, voting separately as a
class may direct the time, method, and place of con-
ducting any proceeding for any remedy available to the
Property Trustee, or exercising any trust or power con-
ferred upon the Property Trustee under the Declaration,
including (i) directing the time, method, place of con-
ducting any proceeding for any remedy available to the
Debenture Trustee, or exercising any trust or power con-
ferred on the Debenture Trustee with respect to the
Debentures, (ii) waive any past default and its conse-
quences that is waivable under Section 513 of the
Indenture, or (iii) exercise any right to rescind or
annul a declaration that the principal of all the
Debentures shall be due and payable, provided, however,
_________________
that, where a consent under the Indenture would
require the consent or act of the Holders of greater
than a majority of the Holders in principal amount of
Debentures affected thereby, (a "Super Majority"), the
Property Trustee may only give such consent or take
such action at the direction of the Holders of at least
the proportion in liquidation amount of the Preferred
Securities which the relevant Super Majority represents
of the aggregate principal amount of the Debentures
outstanding. The Property Trustee shall not revoke any
action previously authorized or approved by a vote of
the Holders of the Preferred Securities. Other than
with respect to directing the time, method and place of
conducting any remedy available to the Property Trustee
or the Debenture Trustee as set forth above, the
Property Trustee shall not take any action in
accordance with the directions of the Holders of the
Preferred Securities under this paragraph unless the
Property Trustee has obtained an opinion of tax counsel
to the effect that for the purposes of United States
federal income tax the Trust will not fail to be
classified as a grantor trust or account of such action.
If the Property Trustee fails to enforce its rights under
the Declaration, any Holder of Preferred Securities may,
after a period of 30 days has elapsed from such Holder's
written request to the Property Trustee to enforce such
rights, institute a legal proceeding directly against any
Person to enforce the Property Trustee's rights under the
Declaration without first instituting a legal proceeding
against the Property Trustee or any other Person.
Any approval or direction of Holders of Preferred
Securities may be given at a separate meeting of
Holders of Preferred Securities convened for such pur-
pose, at a meeting of all of the Holders of Securities
in the Trust or pursuant to written consent. The
Regular Trustees will cause a notice of any meeting at
which Holders of Preferred Securities are entitled to
vote, or of any matter upon which action by written
consent of such Holders is to be taken, to be mailed to
each Holder of record of Preferred Securities. Each
such notice will include a statement setting forth (i)
the date of such meeting or the date by which such
action is to be taken, (ii) a description of any
resolution proposed for adoption at such meeting on
which such Holders are entitled to vote or of such
matter upon which written consent is sought and (iii)
instructions for the delivery of proxies or consents.
No vote or consent of the Holders of the Preferred
Securities will be required for the Trust to redeem and
cancel Preferred Securities or to distribute the Deben-
tures in accordance with the Declaration and the terms
of the Securities.
Notwithstanding that Holders of Preferred Securities
are entitled to vote or consent under any of the cir-
cumstances described above, any of the Preferred
Securities that are owned by the Sponsor or any Affili-
ate of the Sponsor shall not be entitled to vote or
consent and shall, for purposes of such vote or con-
sent, be treated as if they were not outstanding.
6. Voting Rights - Common Securities.
(a) Except as provided under paragraphs 6(b), (c) and 7 as
otherwise required by law and the Declaration, the
Holders of the Common Securities will have no voting
rights.
(b) The Holders of the Common Securities are entitled, in
accordance with Article V of the Declaration, to vote
to appoint, remove or replace any Trustee or to in-
crease or decrease the number of Trustees, subject to
the exclusive right of the Holders of the Preferred
Securities to appoint, remove or replace a Special
Regular Trustee.
(c) Subject to Section 2.6 of the Declaration and only
after the Event of Default with respect to the Pre-
ferred Securities have been cured, waived, or otherwise
eliminated, the requirements of the second to last
sentence of this paragraph,the Holders of a Majority in
liquidation amount of the Common Securities, voting
separately as a class, may direct the time, method, and
place of conducting any proceeding for any remedy
available to the Property Trustee, or exercising any
trust or power conferred upon the Property Trustee
under the Declaration, including (i) directing the
time, method, place of conducting any proceeding for
any remedy available to the Debenture Trustee, or
exercising any trust or power conferred on the Deben-
ture Trustee with respect to the Debentures, (ii) waive
any past default and its consequences that is waivable
under Section 606 of the Indenture, or (iii) exercise
any right to rescind or annul a declaration that the
principal of all the Debentures shall be due and
payable, provided, however, that, where a consent or
_________________
action under the Indenture would require the consent
or act of the Holders of greater than a majority in
principal amount of Debentures affected thereby (a
"Super Majority"), the Property Trustee may only give
such consent or take such action at the direction of
the Holders of at least the proportion in liquidation
amount of the Common Securities which the relevant
Super Majority represents of the aggregate principal
amount of the Debentures outstanding. Pursuant to this
paragraph 6(c), the Property Trustee shall not revoke
any action previously authorized or approved by a vote
of the Holders of the Preferred Securities. Other than
with respect to directing the time, method and place of
conducting any remedy available to the Property Trustee
or the Debenture Trustee as set forth above, the
Property Trustee shall not take any action in accor-
dance with the directions of the Holders of the Common
Securities under this paragraph unless the Property
Trustee has obtained an opinion of tax counsel to the
effect that for the purposes of United States federal
income tax the Trust will not fail to be classified as a
grantor trust on account of such action. If the Property
Trustee fails to enforce its rights under the Declara-
tion, any Holder of Common Securities may, after a
period of 30 days has elapsed from such Holder's
written request to the Property Trustee to enforce such
rights, institute a legal proceeding directly against
any Person to enforce the Property Trustee's rights
under the Declaration, without first instituting
a legal proceeding against the Property Trustee or any
other Person.
Any approval or direction of Holders of Common Securi-
ties may be given at a separate meeting of Holders of
Common Securities convened for such purpose, at a
meeting of all of the Holders of Securities in the
Trust or pursuant to written consent. The Regular
Trustees will cause a notice of any meeting at which
Holders of Common Securities are entitled to vote, or
of any matter upon which action by written consent of
such Holders is to be taken, to be mailed to each
Holder of record of Common Securities. Each such
notice will include a statement setting forth (i) the
date of such meeting or the date by which such action
is to be taken, (ii) a description of any resolution
proposed for adoption at such meeting on which such
Holders are entitled to vote or of such matter upon
which written consent is sought and (iii) instructions
for the delivery of proxies or consents.
No vote or consent of the Holders of the Common Securi-
ties will be required for the Trust to redeem and can-
cel Common Securities or to distribute the Debentures
in accordance with the Declaration and the terms of the
Securities.
7. Amendments to Declaration and Indenture.
(a) In addition to any requirements under Section 12.1 of
the Declaration, if any proposed amendment to the
Declaration provides for, or the Regular Trustees
otherwise propose to effect, (i) any action that would
adversely affect the powers, preferences or special
rights of the Securities, whether by way of amendment
to the Declaration or otherwise, or (ii) the dissolu-
tion, winding-up or termination of the Trust, other
than as described in Section 8.1 of the Declaration,
then the Holders of outstanding Securities as a class,
will be entitled to vote on such amendment or proposal
(but not on any other amendment or proposal) and such
amendment or proposal shall not be effective except
with the approval of the Holders of at least 66 2/3% in
liquidation amount of the Securities, voting together
as a single class provided, however, that, the rights
_________________
of Holders of Preferred Securities under Article V of
the Declaration to appoint, remove or replace a Special
Regular Trustee shall not be amended without the
consent of each Holder of Preferred Securities; pro-
vided, however, if any amendment or proposal referred
to in clause (i) above would adversely affect only the
Preferred Securities or only the Common Securities, then
only the affected class will be entitled to vote on
such amendment or proposal and such amendment or
proposal shall not be effective except with the
approval of 66 2/3% in liquidation amount of such class
of Securities.
(b) In the event the consent of the Property Trustee as the
holder of the Debentures and the Debenture Guarantee is
required under the Indenture with respect to any amend-
ment, modification or termination on the Indenture, the
Debentures or the Debenture Guarantee, the Property
Trustee shall request the direction of the Holders of
the Securities with respect to such amendment, modifi-
cation or termination and shall vote with respect to
such amendment, modification or termination as directed
by a Majority in liquidation amount of the Securities
voting together as a single class; provided, however,
_________________
that where a consent under the Indenture would require
the consent of the holders of greater than a majority
in aggregate principal amount of the Debentures (a
"Super Majority"), the Property Trustee may only give
such consent at the direction of the Holders of at
least the proportion in liquidation amount of the
Securities which the relevant Super Majority represents
of the aggregate principal amount of the Debentures
outstanding; provided, further, that the Property
_________________
Trustee shall not take any action in accordance with
the directions of the Holders of the Securities under
this paragraph 7(b) unless the Property Trustee has
obtained an opinion of tax counsel to the effect that
for the purposes of United States federal income tax
the Trust will not be classified as other than a
grantor trust on account of such action.
8. Pro Rata.
A reference in these terms of the Securities to any payment, dis-
tribution or treatment as being "Pro Rata" shall mean pro rata to
each Holder of Securities according to the aggregate liquidation
amount of the Securities held by the relevant Holder in relation
to the aggregate liquidation amount of all Securities outstanding
unless, in relation to a payment, an Event of Default under the
Indenture has occurred and is continuing, in which case any funds
available to make such payment shall be paid first to each Holder
of the Preferred Securities pro rata according to the aggregate
liquidation amount of Preferred Securities held by the relevant
Holder relative to the aggregate liquidation amount of all
Preferred Securities outstanding, and only after satisfaction of
all amounts owed to the Holders of the Preferred Securities, to
each Holder of Common Securities pro rata according to the aggre-
gate liquidation amount of Common Securities held by the relevant
Holder relative to the aggregate liquidation amount of all Common
Securities outstanding.
9. Ranking.
The Preferred Securities rank pari passu and payment thereon
__________
shall be made Pro Rata with the Common Securities except that,
where an Event of Default occurs and is continuing under the
Indenture in respect of the Debentures held by the Property
Trustee, the rights of Holders of the Common Securities to payment
in respect of Distributions and payments upon liquida-
tion, redemption and otherwise are subordinated to the rights to
payment of the Holders of the Preferred Securities.
10. Listing.
The Regular Trustees shall use their best efforts to cause the
Preferred Securities to be listed for quotation on the New York
Stock Exchange Limited.
11. Acceptance of Securities Guarantee and Indenture.
Each Holder of Preferred Securities and Common Securities, by the
acceptance thereof, agrees to the provisions of the Preferred
Securities Guarantee and the Common Securities Guarantee, respec-
tively, including the subordination provisions therein and to the
provisions of the Indenture.
12. No Preemptive Rights.
The Holders of the Securities shall have no preemptive rights to
subscribe for any additional securities.
13. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration the Preferred
Securities Guarantee or the Common Securities Guarantee (as may be
appropriate), and the Indenture to a Holder without charge on
written request to the Trust at its principal place of business.
<PAGE>
ANNEX I
[F THE PREFERRED SECURITY IS TO BE A GLOBAL CERTIFICATE
INSERT - This Preferred Security is a Global Certificate within
the meaning of the Declaration hereinafter referred to and is
registered in the name of The Depository Trust Company (the
"Depositary") or a nominee of the Depositary. This Preferred
Security is exchangeable for Preferred Securities registered in
the name of a person other than the Depositary or its nominee
only in the limited circumstances described in the Declaration
and no transfer of this Preferred Security (other than a transfer
of this Preferred Security as a whole by the Depositary to a
nominee of the Depository or by a nominee of the Depository to
the Depositary or another nominee of the Depositary) may be
registered except in limited circumstances.
Unless this Preferred Security is presented by an authorized
representative of The Depository Trust Company (55 Water Street,
New York) to the Trust or its agent for registration of transfer,
exchange or payment, and any Preferred Security issued is regis-
tered in the name of Cede & Co. or such other name as requested
by an authorized representative of The Depository Trust Company
and any payment hereon is made to Cede & Co., ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL since the registered owner hereof, Cede & Co., has an
interest herein.]
Certificate Number Number of Preferred Securities
CUSIP NO. _____________
Certificate Evidencing Preferred Securities
of
SOUTHERN UNION FINANCING I
Preferred Securities.
(liquidation amount $25 per Preferred Security)
<PAGE>
SOUTHERN UNION FINANCING I, a statutory business trust formed under
the laws of the State of Delaware (the "Trust"), hereby certifies
that _____________________________ (the "Holder") is the regis-
tered owner of preferred securities of the Trust representing
undivided beneficial interests in the assets of the Trust desig-
nated the _______% Trust Originated Preferred Securities (liq-
uidation amount $25 per Preferred Security) (the "Preferred
Securities"). The Preferred Securities are transferable on the
books and records of the Trust, in person or by a duly authorized
attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer. The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the
Preferred Securities represented hereby are issued and shall in
all respects be subject to the provisions of the Amended and
Restated Declaration of Trust of the Trust dated as of ________,
1995, as the same may be amended from time to time (the "Declara-
tion"), including the designation of the terms of the Preferred
Securities as set forth in Exhibit A to the Declaration. Capi-
talized terms used herein but not defined shall have the meaning
given them in the Declaration. The Holder is entitled to the
benefits of the Preferred Securities Guarantee to the extent pro-
vided therein. The Sponsor will provide a copy of the Decla-
ration, the Preferred Securities Guarantee and the Indenture to a
Holder without charge upon written request to the Trust at its
principal place of business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and
the Preferred Securities as evidence of indirect beneficial
ownership in the Debentures.
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate
this day of ___________________, 199__.
[ ]
as Trustee
______________________________________
[ ]
as Trustee
_______________________________________
_____________________
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this
Preferred Security Certificate to:
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
(Insert assignee's social security or tax identification number)
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
(Insert address and zip code of assignee) and irrevocably
appoints)
_________________________________________________________________
_________________________________________________________________
___________________________________________________________ agent
to transfer this Preferred Security Certificate on the books of
the Trust. The agent may substitute another to act for him or
her.
Date: _______________________
Signature: __________________
(Sign exactly as your name appears on the other side of this Pre-
ferred Security Certificate)
<PAGE>
ANNEX II
Certificate Number Number of Preferred Securities
Certificate Evidencing Common Securities
of
SOUTHERN UNION FINANCING I
Common Securities.
(liquidation amount $25 per Preferred Security)
SOUTHERN UNION FINANCING I, a statutory business trust formed under
the laws of the State of Delaware (the "Trust"), hereby certifies
that _____________________________ (the "Holder") is the regis-
tered owner of common securities of the Trust representing
undivided beneficial interests in the assets of the Trust desig-
nated the _______ Trust Originated Common Securities (liquidation
amount $25 per Common Security) (the "Common Securities"). The
Common Securities are transferable on the books and records of
the Trust, in person or by a duly authorized attorney, upon
surrender of this certificate duly endorsed and in proper form
for transfer. The designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Common Securi-
ties represented hereby are issued and shall in all respects be
subject to the provisions of the Amended and Restated Declaration
of Trust of the Trust dated as of ___________________, 1995, as
the same may be amended from time to time (the "Declaration"),
including the designation of the terms of the Common Securities
as set forth in Exhibit A to the Declaration. Capitalized terms
used herein but not defined shall have the meaning given them in
the Declaration.
The Holder is entitled to the benefits of the Common Securities
Guarantee to the extent provided therein. The Trust will provide
a copy of the Declaration, the Common Securities Guarantee and
the Indenture to a Holder without charge upon written request to
the Trust at its principal place of business.
Upon receipt of this certificate, the Sponsor is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat for United States
federal income tax purposes the Debentures as indebtedness and
the Common Securities as evidence of indirect beneficial owner-
ship in the Debentures.
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate
this day of _____________________, 199__.
[ ]
as Trustee
___________________________________
[ ]
as Trustee
_________________________________
_____________________
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this
Common Security Certificate to:
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
(Insert assignee's social security or tax identification number)
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
(Insert address and zip code of assignee) and irrevocably
appoints)
_________________________________________________________________
_________________________________________________________________
___________________________________________________________ agent
to transfer this Common Security Certificate on the books of the
Trust. The agent may substitute another to act for him or her.
Date: _______________________
Signature: __________________
(Sign exactly as your name appears on the other side of this Pre-
ferred Security Certificate)
<PAGE>
EXHIBIT B
SPECIMEN OF DEBENTURE
<PAGE>
EXHIBIT C
UNDERWRITING AGREEMENT
<PAGE>
EXHIBIT 4-G
FORM OF SUBORDINATED DEBT SECURITIES INDENTURE
AMONG SOUTHERN UNION COMPANY AND
___________________________, AS TRUSTEE
<PAGE>
________________________________________________________________
SOUTHERN UNION COMPANY
TO
THE CHASE MANHATTAN BANK (NATIONAL ASSOCIATION)
_____________________________
Trustee
_________________________________
Indenture
Dated as of _____________, 1995
_________________________________
________________________________________________________________
<PAGE>
INDENTURE, dated as of ______________, 1995, between Southern
Union Company, a corporation duly organized and existing under the
laws of the State of Delaware (herein called the "Company") having
its principal office at 504 Lavaca Street, Eighth Floor, Austin,
Texas 78701, and The Chase Manhattan Bank (National Association),
a national banking association duly organized and existing under
the laws of the United States, Trustee (herein called the
"Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its
unsecured debentures, notes or other evidences of indebtedness
(herein called the "Securities"), to be issued in one or more
series as in this Indenture provided.
This Indenture is subject to the provisions of the Trust Indenture
Act of 1939, as amended, that are required to be part of this
Indenture and shall, to the extent applicable, be governed by such
provisions.
All things necessary to make this Indenture a valid agreement of
the Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and
agreed, for the equal and proportionate benefit of all Holders of
the Securities or of any series thereof, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as
well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein,
have the meanings assigned to them therein, and the terms
"cash transaction" and "self-liquidating paper", as used
in TIA Section 311, shall have the meanings assigned to
them in the rules of the Commission adopted under the
Trust Indenture Act;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally
accepted accounting principles, and, except as otherwise
herein expressly provided, the term "generally accepted
accounting principles" with respect to any computation
required or permitted hereunder shall mean such accounting
principles as are generally accepted at the date of such
computation; and
(4) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole
and not to any particular Article, Section or other sub-
division.
Certain terms, used principally in Article Three, are defined in
that Article.
"Act", when used with respect to any Holder, has the meaning
specified in Section 104.
"Additional Amounts" has the meaning specified in Section 1005.
"Affiliate" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indi-
rect common control with such specified Person. For the purposes
of this definition, "control" of any specified Person means the
power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling"
and "controlled" have meanings correlative to the foregoing.
"Attributable Debt" means, as to any specified lease under which
any
Person is at the time liable for a term of more than 12 months, at
any date as of which the amount thereof is to be determined, the
total net amount of rent required to be paid by such Person under
such lease during the remaining term thereof (excluding any subse-
quent renewal or other extension options held by the lessee), dis-
counted from the respective due dates thereof to such date at a
rate equal to the weighted average of the interest rates borne by
the Outstanding Securities, compounded monthly. The net amount of
rent required to be paid under any such lease for any such period
shall be the aggregate amount of the rent payable by the lessee
with respect to such period after excluding any amounts required to
be paid on account of maintenance and repairs, services, insurance,
taxes, assessments, water rates and similar charges and contingent
rents (such as those based on sales). In the case of any lease
which is terminable by the lessee upon the payment of a penalty,
such net amount of rent shall include the lesser of (i) the total
discounted net amount of rent required to be paid from the later of
the first date upon which such lease may be so terminated or the
date of the determination of such net amount of rent, as the case
may be, and (ii) the amount of such penalty (in which event no rent
shall be considered as required to be paid under such lease subse-
quent to the first date upon which it may be so terminated).
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 611 to act on behalf of the Trustee to
authenticate Securities.
"Authorized Newspaper" means a newspaper, in the English language
or in an official language of the country of publication, custo-
marily published on each Business Day, whether or not published on
Saturdays, Sundays or holidays, and of general circulation in each
place in connection with which the term is used or in the financial
community of each such place. Where successive publications are
required to be made in Authorized Newspapers, such publications may
be made in the same or in different newspapers in the same city
meeting the foregoing requirements and in each case on any Business
Day.
"Bank Credit Facility" means the revolving credit facility dated
September 30, 1993, as amended on November 15, 1993, between the
Company and the Banks as in effect on the date hereof and as such
Facility may be amended, restated, refinanced, supplemented or
otherwise modified from time to time.
"Banks" means the lenders from time to time who are parties to the
Bank Credit Facility.
"Bearer Security" means any Security except a Registered Security.
"Board of Directors" means either the board of directors of the
Company or any duly authorized committee of such board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been
duly adopted by the Board of Directors and to be in full force and
effect on the date of such certification, and delivered to the
Trustee.
"Business Day", when used with respect to any Place of Payment or
any other particular location referred to in this Indenture or in
the Securities, means, unless otherwise specified with respect to
any Securities pursuant to Section 301, each Monday, Tuesday,
Wednesday, Thursday and Friday which is not a day on which banking
institutions in that Place of Payment or other location are
authorized or obligated by law or executive order to close.
"CEDEL S.A." means Cedel, S.A., or its successor.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act
of 1934, or, if at any time after the execution of this Indenture
such Commission is not existing and performing the duties now
assigned to it under the Trust Indenture Act, then the body per-
forming such duties at such time.
"Common Depositary" has the meaning specified in Section 304.
"Common Securities" means undivided beneficial interests in the
assets of a Southern Union Trust which rank pari passu with Pre-
ferred Securities issued by such Southern Union Trust; provided,
_________
however, that upon the occurrence of an Event of Default, the
_______
rights of holders of Common Securities to payment in respect to
distributions and payments upon liquidation, redemption and other-
wise are subordinated to the rights of holders of Preferred
Securities.
"Common Securities Guarantee" means any Guarantee that the Company
enters into that operates directly or indirectly for the benefit of
holders of Common Securities of such Southern Union Trust.
"Company" means the Person named as the "Company" in the first
paragraph of this Indenture until a successor Person shall have
become such pursuant to the applicable provisions of this Inden-
ture, and thereafter "Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or
order signed in the name of the Company by its Chairman, its
President, any Vice President, its Treasurer or an Assistant
Treasurer, and delivered to the Trustee.
"Consolidated Net Tangible Assets" means the total amount of assets
(less applicable reserves and other properly deductible items) of
the Company and its consolidated Subsidiaries after deducting
therefrom (i) all current liabilities (excluding any current lia-
bilities which are by their terms extendible or renewable at the
option of the obligor thereon to a time more than 12 months after
the time as of which the amount thereof is being computed) and (ii)
all goodwill, trade names, trademarks, patents, unamortized debt
discount and expense and other like intangibles, all as set forth
on the most recent balance sheet of the Company and its consoli-
dated Subsidiaries and computed in accordance with generally
accepted accounting principles.
"Consolidated Net Worth" means the sum of stockholder's equity,
preferred stock and minority interests as set forth in the Com-
pany's consolidated financial statements.
"Conversion Date" has the meaning specified in Section 312(d).
"Conversion Event" means the cessation of use of (i) a Foreign
Currency both by the government of the country which issued such
Currency and by a central bank or other public institution of or
within the international banking community for the settlement of
transactions, (ii) the ECU both within the European Monetary System
and for the settlement of transactions by public institutions of or
within the European Communities or (iii) any currency unit (or
composite currency) other than the ECU for the purposes for which
it was established.
"Corporate Trust Office" means the principal corporate trust office
of the Trustee at which at any particular time its corporate trust
business shall be administered, which office on the date of execu-
tion of this Indenture is located at 4 Chase Manhattan Center,
Brooklyn, New York 11245, except that with respect to
presentation of Securities for payment or for registration of
transfer or exchange, such term shall mean the office or agency of
the Trustee at which, at any particular time, its corporate agency
business shall be conducted.
"corporation" includes corporations, associations, companies and
business trusts.
"coupon" means any interest coupon appertaining to a Bearer
Security.
"Currency" means any currency or currencies, composite currency or
currency unit or currency units, including, without limitation, the
ECU, issued by the government of one or more countries or by any
recognized confederation or association of such governments.
"Debt" means notes, bonds, debentures or other similar evidences of
indebtedness for money borrowed.
"Declaration" means, in respect of a Southern Union Trust, the
amended and restated declaration of trust of such Southern Union
Trust or any other governing instrument of such Southern Union
Trust.
"Default" means any event which is, or after notice or passage of
time or both would be, an Event of Default.
"Defaulted Interest" has the meaning specified in Section 307.
"Dollar" or "$" means a dollar or other equivalent unit in such
coin or currency of the United States of America as at the time
shall be legal tender for the payment of public and private debts.
"Dollar Equivalent of the Currency Unit" has the meaning specified
in Section 312(g).
"Dollar Equivalent of the Foreign Currency" has the meaning speci-
fied in Section 312(f).
"ECU" means the European Currency Unit as defined and revised from
time to time by the Council of the European Communities.
"Election Date" has the meaning specified in Section 312(h).
"Euroclear" means Morgan Guaranty Trust Company of New York,
Brussels Office, or its successor as operator of the Euroclear
System.
"European Communities" means the European Economic Community, the
European Coal and Steel Community and the European Atomic Energy
Community.
"European Monetary System" means the European Monetary System
established by the Resolution of December 5, 1978 of the Council of
the European Communities.
"Event of Default" has the meaning specified in Section 501.
"Exchange Date" has the meaning specified in Section 304.
"Exchange Rate Agent" means, with respect to Securities of or
within any series, unless otherwise specified with respect to any
Securities pursuant to Section 301, a New York Clearing House bank,
designated pursuant to Section 301 or Section 313.
"Exchange Rate Officer's Certificate" means a tested telex or a
certificate setting forth (i) the applicable Market Exchange Rate
and (ii) the Dollar or Foreign Currency amounts of principal (and
premium, if any) and interest, if any (on an aggregate basis and on
the basis of a Security having the lowest denomination principal
amount determined in accordance with Section 302 in the relevant
Currency), payable with respect to a Security of any series on the
basis of such Market Exchange Rate, sent (in the case of a telex)
or signed (in the case of a certificate) by the Treasurer, any Vice
President or any Assistant Treasurer of the Company.
"Federal Bankruptcy Code" means the Bankruptcy Act of Title 11 of
the United States Code, as amended from time to time.
"Foreign Currency" means any Currency other than Currency of the
United States.
"Government Obligations" means, unless otherwise specified with
respect to any series of Securities pursuant to Section 301,
securities which are (i) direct obligations of the government which
issued the Currency in which the Securities of a particular series
are payable or (ii) obligations of a Person controlled or super-
vised by and acting as an agency or instrumentality of the govern-
ment which issued the Currency in which the Securities of such
series are payable, the payment of which is unconditionally guaran-
teed by such government, which, in either case, are full faith and
credit obligations of such government payable in such Currency and
are not callable or redeemable at the option of the issuer thereof
and shall also include a depository receipt issued by a bank or
trust company as custodian with respect to any such Government
Obligation or a specific payment of interest on or principal of any
such Government Obligation held by such custodian for the account
of the holder of a depository receipt; provided that (except as
________
required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depository
receipt from any amount received by the custodian in respect of the
Government Obligation or the specific payment of interest or prin-
cipal of the Government Obligation evidenced by such depository
receipt.
"Holder" means, in the case of a Registered Security, the Person in
whose name a Security is registered in the Security Register and,
in the case of a Bearer Security, the bearer thereof and, when used
with respect to any coupon, shall mean the bearer thereof.
"Indenture" means this instrument as originally executed and as it
may from time to time be supplemented or amended by one or more
indentures supplemental hereto entered into pursuant to the appli-
cable provisions hereof, and shall include the terms of particular
series of Securities established as contemplated by Section 301;
provided, however, that, if at any time more than one Person is
_________________
acting as Trustee under this instrument, "Indenture" shall mean,
with respect to any one or more series of Securities for which such
Person is Trustee, this instrument as originally executed or as it
may from time to time be supplemented or amended by one or more
indentures supplemental hereto entered into pursuant to the appli-
cable provisions hereof and shall include the terms of particular
series of Securities for which such Person is Trustee established
as contemplated by Section 301, exclusive, however, of any provi-
sions or terms which relate solely to other series of Securities
for which such Person is not Trustee, regardless of when such terms
or provisions were adopted, and exclusive of any provisions or
terms adopted by means of one or more indentures supplemental
hereto executed and delivered after such Person had become such
Trustee but to which such Person, as such Trustee, was not a party.
"Indexed Security" means a Security the terms of which provide that
the principal amount thereof payable at Stated Maturity may be more
or less than the principal face amount thereof at original
issuance.
"interest", when used with respect to an Original Issue Discount
Security which by its terms bears interest only after Maturity,
means interest payable after Maturity at the rate prescribed in
such Original Issue Discount Security.
"Interest Payment Date", when used with respect to any Security,
means the Stated Maturity of an installment of interest on such
Security.
"Lien" means any pledge, mortgage, lien, charge, encumbrance or
security interest.
"Market Exchange Rate" means, unless otherwise specified with
respect to any Securities pursuant to Section 301, (i) for any con-
version involving a currency unit on the one hand and Dollars or
any Foreign Currency on the other, the exchange rate between the
relevant currency unit and Dollars or such Foreign Currency calcu-
lated by the method specified pursuant to Section 301 for the
Securities of the relevant series, (ii) for any conversion of
Dollars into any Foreign Currency, the noon (New York City time)
buying rate for such Foreign Currency for cable transfers quoted in
New York City as certified for customs purposes by the Federal
Reserve Bank of New York and (iii) for any conversion of one
Foreign Currency into Dollars or another Foreign Currency, the spot
rate at noon local time in the relevant market at which, in accor-
dance with normal banking procedures, the Dollars or Foreign Cur-
rency into which conversion is being made could be purchased with
the Foreign Currency from which conversion is being made from major
banks located in either New York City, London or any other princi-
pal market for Dollars or such purchased Foreign Currency, in each
case determined by the Exchange Rate Agent. Unless otherwise
specified with respect to any Securities pursuant to Section 301,
in the event of the unavailability of any of the exchange rates
provided for in the foregoing clauses (i), (ii) and (iii), the
Exchange Rate Agent shall use, in its sole discretion and without
liability on its part, such quotation of the Federal Reserve Bank
of New York as of the most recent available date, or quotations
from one or more major banks in New York City, London or another
principal market for the Currency in question, or such other quota-
tions as the Exchange Rate Agent shall deem appropriate. Unless
otherwise specified by the Exchange Rate Agent, if there is more
than one market for dealing in any Currency by reason of foreign
exchange regulations or otherwise, the market to be used in respect
of such Currency shall be that upon which a non-resident issuer of
securities designated in such Currency would purchase such Currency
in order to make payments in respect of such securities.
"Maturity", when used with respect to any Security, means the date
on which the principal of such Security or an installment of prin-
cipal becomes due and payable as therein or herein provided,
whether at the Stated Maturity or by declaration of acceleration,
notice of redemption, notice of option to elect repayment or
otherwise.
"Officers' Certificate" means a certificate signed by the Chairman,
the President or a Vice President, and by the Treasurer, an Assis-
tant Treasurer, the Secretary or an Assistant Secretary of the Com-
pany, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company, including an employee of the Company.
"Original Issue Discount Security" means any Security which pro-
vides for an amount less than the principal amount thereof to be
due and payable upon a declaration of acceleration of the Maturity
thereof pursuant to Section 502.
"Outstanding", when used with respect to Securities, means, as of
the date of determination, all Securities theretofore authenticated
and delivered under this Indenture except:
______
(i) Securities theretofore canceled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Securities, or portions thereof, for whose payment or
redemption or repayment at the option of the Holder money
in the necessary amount has been theretofore deposited
with the Trustee or any Paying Agent (other than the Com-
pany) in trust or set aside and segregated in trust by
the Company (if the Company shall act as its own Paying
Agent) for the Holders of such Securities and any coupons
appertaining thereto; provided that, if such Securities
________
are to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture or provision
therefor satisfactory to the Trustee has been made;
(iii) Securities, except to the extent provided in Sections
1402 and 1403, with respect to which the Company has
effected defeasance and/or covenant defeasance as
provided in Article Fourteen; and
(iv) Securities which have been paid pursuant to Section 306
or in exchange for or in lieu of which other Securities
have been authenticated and delivered pursuant to this
Indenture, other than any such Securities in respect of
which there shall have been presented to the Trustee
proof satisfactory to it that such Securities are held by
a bona fide purchaser in whose hands such Securities are
valid obligations of the Company;
provided, however, that in determining whether the Holders of the
_________________
requisite principal amount of the Outstanding Securities have given
any request, demand, authorization, direction, notice, consent or
waiver hereunder or are present at a meeting of Holders for quorum
purposes, and for the purpose of making the calculations required
by TIA Section 313, (i) the principal amount of an Original Issue
Discount Security that may be counted in making such determination
or calculation and that shall be deemed to be Outstanding for such
purpose shall be equal to the amount of principal thereof that
would be (or shall have been declared to be) due and payable, at
the time of such determination, upon a declaration of acceleration
of the maturity thereof pursuant to Section 502, (ii) the principal
amount of any Security denominated in a Foreign Currency that may
be counted in making such determination or calculation and that
shall be deemed Outstanding for such purpose shall be equal to the
Dollar equivalent, determined as of the date such Security is
originally issued by the Company as set forth in an Exchange Rate
Officer's Certificate delivered to the Trustee, of the principal
amount (or, in the case of an Original Issue Discount Security, the
Dollar equivalent as of such date of original issuance of the
amount determined as provided in clause (i) above), of such
Security, (iii) the principal amount of any Indexed Security that
may be counted in making such determination or calculation and that
shall be deemed outstanding for such purpose shall be equal to the
principal face amount of such Indexed Security at original
issuance, unless otherwise provided with respect to such Security
pursuant to Section 301, and (iv) Securities owned by the Company
or any other obligor upon the Securities or any Affiliate of the
Company or of such other obligor shall be disregarded and deemed
not to be Outstanding, except that, in determining whether the
Trustee shall be protected in making such calculation or in relying
upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities which the Trustee knows to be so
owned shall be so disregarded. Securities so owned which have been
pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right
so to act with respect to such Securities and that the pledgee is
not the Company or any other obligor upon the Securities or any
Affiliate of the Company or such other obligor.
"Paying Agent" means any Person (including the Company acting as
Paying Agent) authorized by the Company to pay the principal of (or
premium, if any, on) or interest on any Securities on behalf of the
Company.
"Permitted Liens" means Liens permitted by Section 1009.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision
thereof.
"Place of Payment" means, when used with respect to the Securities
of or within any series, the place or places where the principal of
(and premium, if any, on) and interest on such Securities are pay-
able as specified as contemplated by Sections 301 and 1002.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as
that evidenced by such particular Security; and, for the purposes
of this definition, any Security authenticated and delivered under
Section 306 in exchange for or in lieu of a mutilated, destroyed,
lost or stolen Security or a Security to which a mutilated,
destroyed, lost or stolen coupon appertains shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen
Security or the Security to which the mutilated, destroyed, lost or
stolen coupon appertains, as the case may be.
"Preferred Securities" means undivided beneficial interests in the
assets of a Southern Union Trust which rank pari passu with Common
Securities issued by the occurrence of an Event of Default, the
rights of holders of Common Securities to payment in respect of
distributions and payments upon liquidation, redemption and other-
wise are subordinated to the rights of holders of Preferred Securi-
ties.
"Preferred Securities Guarantee" means any Guarantee that the Guar-
antor may enter into with Wilmington Trust Company, as Trustee or
other Persons that operate directly or indirectly for the benefit
of holders of Preferred Securities of such Southern Union Trust.
"Redemption Date", when used with respect to any Security to be
redeemed, in whole or in part, means the date fixed for such
redemption by or pursuant to this Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to
this Indenture.
"Registered Security" means any Security registered in the Security
Register.
"Regular Record Date" for the interest payable on any Interest Pay-
ment Date on the Registered Securities of or within any series
means the date specified for that purpose as contemplated by
Section 301.
"Repayment Date" means, when used with respect to any Security to
be repaid at the option of the Holder, the date fixed for such
repayment pursuant to this Indenture.
"Repayment Price" means, when used with respect to any Security to
be repaid at the option of the Holder, the price at which it is to
be repaid pursuant to this Indenture.
"Responsible Officer", when used with respect to the Trustee, means
the chairman or any vice-chairman of the board of directors, the
chairman or any vice-chairman of the executive committee of the
board of directors, the chairman of the trust committee, the presi-
dent, or any vice president, secretary, any assistant secretary,
treasurer, any assistant treasurer, cashier, any assistant cashier,
any trust officer or assistant trust officer, the controller or any
assistant controller within the corporate trust administration
division or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above-designated
officers, and also means, with respect to a particular corporate
trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular
subject.
"Restricted Securities" has the meaning specified in Section 1009.
"Securities" has the meaning stated in the first recital of this
Indenture and more particularly means any Securities authenticated
and delivered under this Indenture; provided, however, that if at
_________________
any time there is more than one Person acting as Trustee under this
Indenture, "Securities" with respect to the Indenture as to which
such Person is Trustee shall have the meaning stated in the first
recital of this Indenture and shall more particularly mean Securi-
ties authenticated and delivered under this Indenture, exclusive,
however, of Securities of any series as to which such Person is not
Trustee.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Southern Union Trust" means each of Southern Union Financing I,
Southern Union Financing II and Southern Union Financing III, each,
a Delaware statutory business trust.
"Special Record Date" for the payment of any Defaulted Interest on
the Registered Securities of or within any series means a date
fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the
date specified in such Security or a coupon representing such
installment of interest as the fixed date on which the principal of
such Security or such installment of principal or interest is due
and payable, as such date may be extended pursuant to the provi-
sions of Section 308.
"Subsidiary" means any corporation of which at the time of deter-
mination the Company, directly and/or indirectly through one or
more Subsidiaries, owns 50% or more of the shares of Voting Stock.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of
1939 as in force at the date as of which this Indenture was
executed, except as provided in Section 905.
"Trust Securities" means Common Securities and Preferred Securi-
ties.
"Trust Securities Guarantees" means the Common Securities Guarantee
and the Preferred Securities Guarantee.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor Trustee shall have
become such pursuant to the applicable provisions of this Inden-
ture, and thereafter "Trustee" shall mean or include each Person
who is then a Trustee hereunder; provided, however, that if at any
_________________
time there is more than one such Person, "Trustee" as used with
respect to the Securities of any series shall mean only the Trustee
with respect to Securities of that series.
"United States" means, unless otherwise specified with respect to
any Securities pursuant to Section 301, the United States of
America (including the states and the District of Columbia), its
territories, its possessions and other areas subject to its
jurisdiction.
"United States person" means, unless otherwise specified with
respect to any Securities pursuant to Section 301, an individual
who is a citizen or resident of the United States, a corporation,
partnership or other entity created or organized in or under the
laws of the United States or an estate or trust the income of which
is subject to United States federal income taxation regardless of
its source.
"Valuation Date" has the meaning specified in Section 312(c).
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a
number or a word or words added before or after the title "vice
president".
"Voting Stock" means stock of the class or classes having general
voting power under ordinary circumstances to elect at least a
majority of the board of directors, managers or trustees of a cor-
poration (irrespective of whether or not at the time stock of any
other class or classes shall have or might have voting power by
reason of the happening of any contingency).
"Yield to Maturity" means the yield to maturity, computed at the
time of issuance of a Security (or, if applicable, at the most
recent redetermination of interest on such Security) and as set
forth in such Security in accordance with generally accepted United
States bond yield computation principles.
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to
take any action under any provision of this Indenture, the Company
shall furnish to the Trustee an Officers' Certificate stating that
all conditions precedent, if any, provided for in this Indenture
(including any covenant compliance with which constitutes a condi-
tion precedent) relating to the proposed action have been complied
with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied
with, except that in the case of any such application or request as
to which the furnishing of such documents is specifically required
by any provision of this Indenture relating to such particular
application or request, no additional certificate or opinion need
be furnished.
Every certificate or opinion with respect to compliance with a
covenant or condition provided for in this Indenture (other than
pursuant to Section 1004) shall include:
(1) a statement that each individual signing such certifi-
cate or opinion has read such covenant or condition and
the definitions herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or
opinions contained in such certificate or opinion are
based;
(3) a statement that, in the opinion of each such individual,
he has made such examination or investigation as is neces-
sary to enable him to express an informed opinion as to
whether or not such covenant or condition has been com-
plied with; and
(4) a statement as to whether, in the opinion of each such
individual, such covenant or condition has been complied
with.
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by,
or covered by an opinion of, any specified Person, it is not
necessary that all such matters be certified by, or covered by the
opinion of, only one such Person, or that they be so certified or
covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other
such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate
or opinion of, or representations by, counsel, unless such officer
knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to the mat-
ters upon which his certificate or opinion is based are erroneous.
Any such certificate or Opinion of Counsel may be based, insofar
as it relates to factual matters, upon a certificate or opinion of,
or representations by, an officer or officers of the Company
stating that the information with respect to such factual matters
is in the possession of the Company, unless such counsel knows, or
in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements,
opinions or other instruments under this Indenture, they may, but
need not, be consolidated and form one instrument.
SECTION 104. Acts of Holders.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture
to be given or taken by Holders of the Outstanding Securi-
ties of all series or one or more series, as the case may
be, may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such
Holders in person or by agents duly appointed in writing.
If Securities of a series are issuable as Bearer Securi-
ties, any request, demand, authorization, direction,
notice, consent, waiver or other action provided by this
Indenture to be given or taken by Holders of such series
may, alternatively, be embodied in and evidenced by the
record of Holders of Securities of such series voting in
favor thereof, either in person or by proxies duly
appointed in writing, at any meeting of Holders of Securi-
ties of such series duly called and held in accordance
with the provisions of Article Fifteen, or a combination
of such instruments and any such record. Except as herein
otherwise expressly provided, such action shall become
effective when such instrument or instruments or record or
both are delivered to the Trustee and, where it is hereby
expressly required, to the Company. Such instrument or
instruments and any such record (and the action embodied
therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Holders signing such
instrument or instruments or so voting at any such
meeting. Proof of execution of any such instrument or of
a writing appointing any such agent, or of the holding by
any Person of a Security, shall be sufficient for any pur-
pose of this Indenture and conclusive in favor of the
Trustee and the Company, if made in the manner provided in
this Section. The record of any meeting of Holders of
Securities shall be proved in the manner provided in
Section 1506.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit
of a witness of such execution or by a certificate of a
notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual
signing such instrument or writing acknowledged to him the
execution thereof. Where such execution is by a signer
acting in a capacity other than his individual capacity,
such certificate or affidavit shall also constitute suffi-
cient proof of authority. The fact and date of the execu-
tion of any such instrument or writing, or the authority
of the Person executing the same, may also be proved in
any other manner which the Trustee deems sufficient.
(c) The principal amount and serial numbers of Registered
Securities held by any Person, and the date of holding the
same, shall be proved by the Security Register.
(d) The principal amount and serial numbers of Bearer Securi-
ties held by any Person, and the date of holding the same,
may be proved by the production of such Bearer Securities
or by a certificate executed, as depositary, by any trust
company, bank, banker or other depositary, wherever
situated, if such certificate shall be deemed by the
Trustee to be satisfactory, showing that at the date
therein mentioned such Person had on deposit with such
depositary, or exhibited to it, the Bearer Securities
therein described; or such facts may be proved by the
certificate or affidavit of the Person holding such Bearer
Securities, if such certificate or affidavit is deemed by
the Trustee to be satisfactory. The Trustee and the Com-
pany may assume that such ownership of any Bearer Security
continues until (1) another certificate or affidavit
bearing a later date issued in respect of the same Bearer
Security is produced, or (2) such Bearer Security is pro-
duced to the Trustee by some other Person, or (3) such
Bearer Security is surrendered in exchange for a Regis-
tered Security, or (4) such Bearer Security is no longer
Outstanding. The principal amount and serial numbers of
Bearer Securities held by any Person, and the date of
holding the same, may also be proved in any other manner
which the Trustee deems sufficient.
(e) If the Company shall solicit from the Holders of Regis-
tered Securities any request, demand, authorization,
direction, notice, consent, waiver or other Act, the Com-
pany may, at its option, by or pursuant to a Board Resolu-
tion, fix in advance a record date for the determination
of Holders entitled to give such request, demand, authori-
zation, direction, notice, consent, waiver or other Act,
but the Company shall have no obligation to do so.
Notwithstanding TIA Section 316(c), such record date shall
be the record date specified in or pursuant to such Board
Resolution, which shall be a date not earlier than the
date thirty (30) days prior to the first solicitation of
Holders generally in connection therewith and not later
than the date such solicitation is completed. If such a
record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other Act may be
given before or after such record date, but only the
Holders of record at the close of business on such record
date shall be deemed to be Holders for the purposes of
determining whether Holders of the requisite proportion of
Outstanding Securities have authorized or agreed or con-
sented to such request, demand, authorization, direction,
notice, consent, waiver or other Act, and for that purpose
the Outstanding Securities shall be computed as of such
record date; provided that no such authorization, agree-
________
agreement or consent by the Holders on such record date
shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later
than eleven months after the record date.
(f) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security
shall bind every future Holder of the same Security and
the Holder of every Security issued upon the registration
of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted or suffered
to be done by the Trustee or the Company in reliance
thereon, whether or not notation of such action is made
upon such Security.
SECTION 105. Notices, etc. to Trustee and Company.
Any request, demand, authorization, direction, notice, consent,
waiver or Act of Holders or other documents provided or permitted
by this Indenture to be made upon, given or furnished to, or filed
with,
(1) the Trustee by any Holder or by the Company shall be suf-
ficient for every purpose hereunder if made, given, fur-
nished or filed in writing to or with the Trustee at its
Corporate Trust Office, Attention: Corporate Trust
Administration Division, or
(2) the Company by the Trustee or by any Holder shall be suf-
ficient for every purpose hereunder (unless otherwise
herein expressly provided) if in writing and mailed,
first-class postage prepaid, to the Company addressed to
it at the address of its principal office specified in the
first paragraph of this Indenture or at any other address
previously furnished in writing to the Trustee by the
Company.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice of any event to Holders of
Registered Securities by the Company or the Trustee, such notice
shall be sufficiently given (unless otherwise herein expressly pro-
vided) if in writing and mailed, first-class postage prepaid, to
each such Holder affected by such event, at his address as it
appears in the Security Register, not later than the latest date,
and not earlier than the earliest date, prescribed for the giving
of such notice. In any case where notice to Holders of Registered
Securities is given by mail, neither the failure to mail such
notice, nor any defect in any notice so mailed, to any particular
Holder shall affect the sufficiency of such notice with respect to
other Holders of Registered Securities or the sufficiency of any
notice to Holders of Bearer Securities given as provided. Any
notice mailed to a Holder in the manner herein prescribed shall be
conclusively deemed to have been received by such Holder, whether
or not such Holder actually receives such notice.
In case, by reason of the suspension of or irregularities in regu-
lar mail service or by reason of any other cause, it shall be
impractical to mail notice of any event to Holders of Registered
Securities when such notice is required to be given pursuant to any
provision of this Indenture, then any manner of giving such notice
as shall be satisfactory to the Trustee shall be deemed to be
sufficient giving of such notice for every purpose hereunder.
Except as otherwise expressly provided herein or otherwise speci-
fied with respect to any Securities pursuant to Section 301, where
this Indenture provides for notice to Holders of Bearer Securities
of any event, such notice shall be sufficiently given to Holders of
Bearer Securities if published in an Authorized Newspaper in The
City of New York and in such other city or cities as may be speci-
fied in such Securities on a Business Day at least twice, the first
such publication to be not earlier than the earliest date, and not
later than the latest date, prescribed for the giving of such
notice. Any such notice shall be deemed to have been given on the
date of the first such publication.
In case by reason of the suspension of publication of any Autho-
rized Newspaper or Authorized Newspapers or by reason of any other
cause it shall be impracticable to publish any notice to Holders of
Bearer Securities as provided above, then such notification to
Holders of Bearer Securities as shall be given with the approval of
the Trustee shall constitute sufficient notice to such Holders for
every purpose hereunder. Neither the failure to give notice by
publication to Holders of Bearer Securities as provided above, nor
any defect in any notice so published, shall affect the sufficiency
of such notice with respect to other Holders of Bearer Securities
or the sufficiency of any notice to Holders of Registered Securi-
ties given as provided herein.
Any request, demand, authorization, direction, notice, consent or
waiver required or permitted under this Indenture shall be in the
English language, except that any published notice may be in an
official language of the country of publication.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such
notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall
be filed with the Trustee, but such filing shall not be a condition
precedent to the validity of any action taken in reliance upon such
waiver.
SECTION 107. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents
are for convenience only and shall not affect the construction
hereof.
SECTION 108. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
SECTION 109. Separability Clause.
In case any provision in this Indenture or in any Security or
coupon shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
SECTION 110. Benefits of Indenture.
Nothing in this Indenture or in the Securities or coupons, express
or implied, shall give to any Person, other than the parties
hereto, any Authenticating Agent, any Paying Agent, any Securities
Registrar and their successors hereunder and the Holders of Securi-
ties or coupons, any benefit or any legal or equitable right,
remedy or claim under this Indenture.
SECTION 111. Governing Law.
THIS INDENTURE AND THE SECURITIES AND COUPONS SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.
THIS INDENTURE IS SUBJECT TO THE PROVISIONS OF THE TRUST INDENTURE
ACT OF 1939, AS AMENDED, THAT ARE REQUIRED TO BE PART OF THIS
INDENTURE AND SHALL, TO THE EXTENT APPLICABLE, BE GOVERNED BY SUCH
PROVISIONS.
SECTION 112. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or
Stated Maturity or Maturity of any Security shall not be a Business
Day at any Place of Payment, then (notwithstanding any other provi-
sion of this Indenture or of any Security or coupon other than a
provision in the Securities of any series which specifically states
that such provision shall apply in lieu of this Section) payment of
interest or principal (and premium, if any) need not be made at
such Place of Payment on such date, but may be made on the next
succeeding Business Day at such Place of Payment with the same
force and effect as if made on the Interest Payment Date or Redemp-
tion Date, or at the Stated Maturity or Maturity; provided that no
________
interest shall accrue for the period from and after such Interest
Payment Date, Redemption Date, Stated Maturity or Maturity, as the
case may be.
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally.
The Registered Securities, if any, of each series and the Bearer
Securities, if any, of each series and related coupons shall be in
substantially the forms as shall be established by or pursuant to
a Board Resolution or in one or more indentures supplemental
hereto, in each case with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by
this Indenture, and may have such letters, numbers or other marks
of identification and such legends or endorsements placed thereon
as may be required to comply with the rules of any securities
exchange or as may, consistently herewith, be determined by the
officers executing such Securities or coupons. If the forms of
Securities or coupons of any series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of
such action shall be certified by the Secretary or an Assistant
Secretary of the Company and delivered to the Trustee at or prior
to the delivery of the Company Order contemplated by Section 303
for the authentication and delivery of such Securities or coupons.
Any portion of the text of any Security may be set forth on the
reverse thereof, with an appropriate reference thereto on the face
of the Security.
Unless otherwise specified as contemplated by Section 301, Securi-
ties in bearer form shall have interest coupons attached.
The Trustee's certificate of authentication on all Securities shall
be in substantially the form set forth in this Article.
The definitive Securities and coupons shall be printed, litho-
graphed or engraved on steel-engraved borders or may be produced in
any other manner, all as determined by the officers of the Company
executing such Securities, as evidenced by their execution of such
Securities or coupons.
SECTION 202. Form of Trustee's Certificate of Authentication.
Subject to Section 611, the Trustee's certificate of authentication
shall be in substantially the following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
The Chase Manhattan Bank (National Association)
_______________________________________________
as Trustee
By:____________________________________________
Authorized Officer
SECTION 203. Securities Issuable in Global Form.
If Securities of or within a series are issuable in global form, as
specified as contemplated by Section 301, then, notwithstanding
clause (10) of Section 301, any such Security shall represent such
of the Outstanding Securities of such series as shall be specified
therein and may provide that it shall represent the aggregate
amount of Outstanding Securities of such series from time to time
endorsed thereon and that the aggregate amount of Outstanding
Securities of such series represented thereby may from time to time
be increased or decreased to reflect exchanges. Any endorsement of
a Security in global form to reflect the amount, or any increase or
decrease in the amount, of Outstanding Securities represented
thereby shall be made by the Trustee in such manner and upon
instructions given by such Person or Persons as shall be specified
therein or in the Company Order to be delivered to the Trustee
pursuant to Section 303 or Section 304. Subject to the provisions
of Section 303 and, if applicable, Section 304, the Trustee shall
deliver and redeliver any Security in permanent global form in the
manner and upon instructions given by the Person or Persons speci-
fied therein or in the applicable Company Order. If a Company
Order pursuant to Section 303 or Section 304 has been, or simul-
taneously is, delivered, any instructions by the Company with
respect to endorsement or delivery or redelivery of a Security in
global form shall be in writing but need not comply with Section
102 and need not be accompanied by an Opinion of Counsel.
The provisions of the last sentence of Section 303 shall apply to
any Security represented by a Security in global form if such
Security was never issued and sold by the Company and the Company
delivers to the Trustee the Security in global form together with
written instructions (which need not comply with Section 102 and
need not be accompanied by an Opinion of Counsel) with regard to
the reduction in the principal amount of Securities represented
thereby, together with the written statement contemplated by the
last sentence of Section 303.
Notwithstanding the provisions of Section 307, unless otherwise
specified as contemplated by Section 301, payment of principal of
and any premium and interest on any Security in permanent global
form shall be made to the Person or Persons specified therein.
Notwithstanding the provisions of Section 309 and except as pro-
vided in the preceding paragraph, the Company, the Trustee and any
agent of the Company and the Trustee shall treat as the Holder of
such principal amount of Outstanding Securities represented by a
permanent global Security (i) in the case of a permanent global
Security in registered form, the Holder of such permanent global
Security in registered form, or (ii) in the case of a permanent
global Security in bearer form, Euroclear or CEDEL.
ARTICLE THREE
THE SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in one or more Board Resolutions or pursuant to autho-
rity granted by one or more Board Resolutions and, subject to Sec-
tion 303, set forth in, or determined in the manner provided in, an
Officers' Certificate, or established in one or more indentures
supplemental hereto, prior to the issuance of Securities of any
series, any or all of the following, as applicable (each of which
(except for the matters set forth in clauses (1), (2) and (19)
below), if so provided, may be determined from time to time by the
Company with respect to unissued Securities of the series and set
forth in such Securities of the series when issued from time to
time):
(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from all other
series of Securities);
(2) any limit upon the aggregate principal amount of the
Securities of the series that may be authenticated and
delivered under this Indenture (except for Securities
authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Securities of
the series pursuant to Section 304, 305, 306, 906, 1107 or
1305);
(3) the date or dates, or the method by which such date or
dates will be determined or extended, on which the princi-
principal of the Securities of the series is payable;
(4) the rate or rates at which the Securities of the series
shall bear interest, if any, or the method by which such
rate or rates shall be determined, the date or dates from
which such interest shall accrue, or the method by which
such date ordates shall be determined, the Interest Pay-
ment Dates on which such interest shall be payable and the
Regular Record Date, if any, for the interest payable on
any Registered Security on any Interest Payment Date, or
the method by which such date or dates shall be deter-
mined, and the basis upon which interest shall be calcu-
lated if other than on the basis of a 360-day year of
twelve 30-day months;
(5) the rights, if any, to defer payments of interest on the
Securities by extending the interest payment periods and
the duration of such extension;
(6) the subordination terms of the Securities of the series;
(7) the place or places, if any, other than or in addition
to The City of New York, where the principal of (and
premium, if any, on) and any interest on Securities of the
series shall be payable, any Registered Securities of the
series may be surrendered for registration of transfer,
Securities of the series may be surrendered for exchange
and, if different than the location specified in Section
106, the place or places where notices or demands to or
upon the Company in respect of the Securities of the
series and this Indenture may be served;
(8) the period or periods within which, the price or prices
at which, the Currency in which, and other terms and con-
ditions upon which Securities of the series may be
redeemed, in whole or in part, at the option of the Com-
pany, if the Company is to have that option;
(9) the obligation, if any, of the Company to redeem, repay
or purchase Securities of the series pursuant to any
sinking fund or analogous provision or at the option of a
Holder thereof, and the period or periods within which,
the price or prices at which, the Currency in which, and
other terms and conditions upon which Securities of the
series shall be redeemed, repaid or purchased, in whole or
in part, pursuant to such obligation;
(10) if other than denominations of $25 and any integral
multiple thereof, the denomination or denominations in
which any Registered Securities of the series shall be
issuable and, if other than the denomination of $5,000,
the denomination or denominations in which any Bearer
Securities of the series shall be issuable;
(11) if other than the Trustee, the identity of each Security
Registrar and/or Paying Agent;
(12) if other than the principal amount thereof, the portion of
the principal amount of Securities of the series that
shall be payable upon declaration of acceleration of the
Maturity thereof pursuant to Section 502 or the method by
which such portion shall be determined;
(13) if other than Dollars, the Currency in which payment of
the principal of (and premium, if any, on) or interest, if
any, on the Securities of the series shall be payable or
in which the Securities of the series shall be denominated
and the particular provisions applicable thereto in
accordance with, in addition to or in lieu of any of the
provisions of Section 312;
(14) whether the amount of payments of principal of (and pre-
mium, if any, on) or interest on the Securities of the
series may be determined with reference to an index, for-
mula or other method (which index, formula or method may
be based, without limitation, on one or more Currencies,
commodities, equity indices or other indices), and the
manner in which such amounts shall be determined;
(15) whether the principal of (and premium, if any, on) and
interest, if any, on the Securities of the series are to
be payable, at the election of the Company or a Holder
thereof, in a Currency other than that in which such
Securities are denominated or stated to be payable, the
period or periods within which (including the Election
Date), and the terms and conditions upon which, such
election may be made, and the time and manner of deter-
mining the exchange rate between the Currency in which
such Securities are denominated or stated to be payable
and the Currency in which such Securities are to be so
payable, in each case in accordance with, in addition to
or in lieu of any of the provisions of Section 312;
(16) the designation of the initial Exchange Rate Agent, if
any;
(17) any provisions in modification of, in addition to or in
lieu of the provisions of Article Fourteen that shall be
applicable to the Securities of the series;
(18) provisions, if any, granting special rights to the Holders
of Securities of the series upon the occurrence of such
events as may be specified;
(19) any deletions from, modifications of or additions to the
Events of Default or covenants of the Company with respect
to Securities of the series, whether or not such Events of
Default or covenants are consistent with the Events of
Default or covenants set forth herein;
(20) whether Securities of the series are to be issuable as
Registered Securities, Bearer Securities (with or without
coupons) or both, any restrictions applicable to the
offer, sale or delivery of Bearer Securities, whether any
Securities of the series are to be issuable initially in
temporary global form and whether any Securities of the
series are to be issuable in permanent global form with or
without coupons and, if so, whether beneficial owners
of interests in any such permanent global Security may
exchange such interests for Securities of such series and
of like tenor of any authorized form and denomination and
the circumstances under which any such exchanges may
occur, if other than in the manner provided in Section
305, whether Registered Securities of the series may be
exchanged for Bearer Securities of the series (if per-
mitted by applicable laws and regulations), whether Bearer
Securities of the series may be exchanged for Registered
Securities of the series, and the circumstances under
which and the place or places where such exchanges may be
made and if Securities of the series are to be issuable in
global form, the identity of any initial depository there-
for; provided, that, unless otherwise provided, Securities
shall be issued as Registered Securities;
(21) the date as of which any Bearer Securities of the series
and any temporary global Security representing Outstanding
Securities of the series shall be dated if other than the
date of original issuance of the first Security of the
series to be issued;
(22) the Person to whom any interest on any Registered
Security of the series shall be payable, if other than the
Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest, the
manner in which, or the Person to whom, any interest on
any Bearer Security of the series shall be payable, if
otherwise than upon presentation and surrender of the
coupons appertaining thereto as they severally mature, and
the extent to which, or the manner in which, any interest
payable on a temporary global Security on an Interest Pay-
ment Date will be paid if other than in the manner pro-
vided in Section 304;
(23) if Securities of the series are to be issuable in defini-
tive form (whether upon original issue or upon exchange
of a temporary Security of such series) only upon receipt
of certain certificates or other documents or satisfaction
of other conditions, the form and/or terms of such cer-
tificates, documents or conditions;
(24) whether and under what circumstances the Company will
pay Additional Amounts as contemplated by Section 1005 on
the Securities of the series to any Holder who is not a
United States person (including any modification to the
definition of such term) in respect of any tax, assessment
or governmental charge and, if so, whether the Company
will have the option to redeem such Securities rather than
pay such Additional Amounts (and the terms of any such
option);
(25) if the Securities of the series are to be convertible into
or exchangeable for any securities of any Person
(including the Company), the terms and conditions upon
which such Securities will be so convertible or exchange-
able; and
(26) any other terms, conditions, rights and preferences (or
limitations on such rights and preferences) relating to
the series (which terms shall not be inconsistent with the
requirements of the Trust Indenture Act or the provisions
of this Indenture).
All Securities of any one series and the coupons apper-
taining to any Bearer Securities of such series shall be
substantially identical except, in the case of Registered
Securities, as to denomination and except as may otherwise
be provided in or pursuant to such Board Resolution (sub-
ject to Section 303) and set forth in such Officers' Cer-
tificate or in any such indenture supplemental hereto.
Not all Securities of any one series need be issued at the
same time, and, unless otherwise provided, a series may be
reopened for issuances of additional Securities of such
series.
If any of the terms of the series are established by
action taken pursuant to one or more Board Resolutions, a
copy of an appropriate record of such action(s) shall be
certified by the Secretary or an Assistant Secretary of
the Company and such Board Resolutions shall be delivered
to the Trustee at or prior to the delivery of the
Officers' Certificate setting forth the terms of the
series.
SECTION 302. Denominations.
The Securities of each series shall be issuable in such denomina-
tions as shall be specified as contemplated by Section 301. With
respect to Securities of any series denominated in Dollars, in the
absence of any such provisions, the Registered Securities of such
series, other than Registered Securities issued in global form
(which may be of any denomination), shall be issuable in denomina-
tions of $25 and any integral multiple thereof and the Bearer
Securities of such series, other than the Bearer Securities issued
in global form (which may be of any denomination), shall be
issuable in a denomination of $5,000.
SECTION 303. Execution, Authentication, Delivery and Dating.
The Securities and any coupons appertaining thereto shall be exe-
cuted on behalf of the Company by its Chairman, its President or a
Vice President, under its corporate seal reproduced thereon
attested by its Secretary or an Assistant Secretary. The signa-
ture of any of these officers on the Securities or coupons may be
the manual or facsimile signatures of the present or any future
such authorized officer and may be imprinted or otherwise
reproduced on the Securities.
Securities or coupons bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company
shall bind the Company, notwithstanding that such individuals or
any of them have ceased to hold such offices prior to the authenti-
cation and delivery of such Securities or did not hold such offices
at the date of such Securities or coupons.
At any time and from time to time after the execution and delivery
of this Indenture, the Company may deliver Securities of any series
together with any coupon appertaining thereto, executed by the Com-
pany to the Trustee for authentication, together with a Company
Order for the authentication and delivery of such Securities, and
the Trustee in accordance with such Company Order shall authenti-
cate and deliver such Securities; provided, however, that, in con-
_________________
nection with its original issuance, no bearer Security shall be
mailed or otherwise delivered to any location in the United States;
and provided, further, that, unless otherwise specified with
_________________
respect to any series of Securities pursuant to Section 301, a
Bearer Security may be delivered in connection with its original
issuance only if the Person entitled to receive such Bearer
Security shall have furnished a certificate in the form set forth
in Exhibit A-1 to this Indenture, dated no earlier than 15 days
prior to the earlier of the date on which such Bearer Security is
delivered and the date on which any temporary Security first
becomes exchangeable for such Bearer Security in accordance with
the terms of such temporary Security and this Indenture. If any
Security shall be represented by a permanent global Bearer
Security, then, for purposes of this Section and Section 304, the
notation of a beneficial owner's interest therein upon original
issuance of such Security or upon exchange of a portion of a
temporary global Security shall be deemed to be delivery in con-
nection with its original issuance of such beneficial owner's
interest in such permanent global Security. Except as permitted by
Section 306, the Trustee shall not authenticate and deliver any
Bearer Security unless all appurtenant coupons for interest then
matured have been detached and canceled. If not all the Securities
of any series are to be issued at one time and if the Board Resolu-
tion or supplemental indenture establishing such series shall so
permit, such Company Order may set forth procedures acceptable to
the Trustee for the issuance of such Securities and determining
terms of particular Securities of such series such as interest
rate, maturity date, date of issuance and date from which interest
shall accrue.
In authenticating such Securities, and accepting the additional
responsibilities under this Indenture in relation to such Securi-
ties, the Trustee shall be entitled to receive, and (subject to TIA
Sections 315(a) through 315(d)) shall be fully protected in relying
upon, an Opinion of Counsel stating:
(a) that the form or forms of such Securities and any coupons
have been established in conformity with the provisions of
this Indenture;
(b) that the terms of such Securities and any coupons have
been established in conformity with the provisions of this
Indenture;
(c) that such Securities, together with any coupons apper-
taining thereto, when completed by appropriate insertions
and executed and delivered by the Company to the Trustee
for authentication in accordance with this Indenture,
authenticated and delivered by the Trustee in accordance
with this Indenture and issued by the Company in the man-
ner and subject to any conditions specified in such
Opinion of Counsel, will constitute the legal, valid and
binding obligations of the Company, enforceable in accor-
dance with their terms, subject to applicable bankruptcy,
insolvency, reorganization and other similar laws of
general applicability relating to or affecting the
enforcement of creditors' rights, to general equitable
principles and to such other qualifications as such
counsel shall conclude do not materially affect the rights
of Holders of such Securities and any coupons;
(d) that all laws and requirements in respect of the execution
and delivery by the Company of such Securities, any
coupons and of the supplemental indentures, if any, have
been complied with and that authentication and delivery of
such Securities and any coupons and the execution and
delivery of the supplemental indenture, if any, by the
Trustee will not violate the terms of the Indenture;
(e) that the Company has the corporate power to issue such
Securities and any coupons, and has duly taken all neces-
sary corporate action with respect to such issuance; and
(f) that the issuance of such Securities and any coupons will
not contravene the articles of incorporation or by-laws
of the Company or result in any violation of any of the
terms or provisions of any law or regulation or of any
indenture, mortgage or other agreement known to such
Counsel by which the Company is bound.
Notwithstanding the provisions of Section 301 and of the preceding
two paragraphs, if not all the Securities of any series are to be
issued at one time, it shall not be necessary to deliver the
Officers' Certificate otherwise required pursuant to Section 301 or
the Company Order and Opinion of Counsel otherwise required pursu-
ant to the preceding two paragraphs prior to or at the time of
issuance of each Security, but such documents shall be delivered
prior to or at the time of issuance of the first Security of such
series.
The Trustee shall not be required to authenticate and deliver any
such Securities if the issue of such Securities pursuant to this
Indenture will affect the Trustee's own rights, duties or immuni-
ties under the Securities and this Indenture or otherwise in a
manner which is not reasonably acceptable to the Trustee.
Each Registered Security shall be dated the date of its authentica-
tion, and each Bearer Security shall be dated as of the date speci-
fied as contemplated by Section 301.
No Security or coupon shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there
appears on such Security a certificate of authentication substan-
tially in the form provided for herein duly executed by the Trustee
by manual signature of an authorized officer, and such certificate
upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and
delivered hereunder and is entitled to the benefits of this Inden-
ture. Notwithstanding the foregoing, if any Security shall have
been authenticated and delivered hereunder but never issued and
sold by the Company, and the Company shall deliver such Security to
the Trustee for cancellation as provided in Section 310 together
with a written statement (which need not comply with Section 102
and need not be accompanied by an Opinion of Counsel) stating that
such Security has never been issued and sold by the Company, for
all purposes of this Indenture such Security shall be deemed never
to have been authenticated and delivered hereunder and shall never
be entitled to the benefits of this Indenture.
SECTION 304. Temporary Securities.
Pending the preparation of definitive Securities of any series, the
Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in
any authorized denomination, substantially of the tenor of the
definitive Securities in lieu of which they are issued, in
registered form or, if authorized, in bearer form with one or more
coupons or without coupons, and with such appropriate insertions,
omissions, substitutions and other variations as the officers
executing such Securities may determine, as conclusively evidenced
by their execution of such Securities. Such temporary Securities
may be in global form.
Except in the case of temporary Securities in global form (which
shall be exchanged in accordance with the provisions of the fol-
lowing paragraphs), if temporary Securities of any series are
issued, the Company will cause definitive Securities of that series
to be prepared without unreasonable delay. After the preparation
of definitive Securities of such series, the temporary Securities
of such series shall be exchangeable for definitive Securities of
such series, upon surrender of the temporary securities of such
series at the office or agency of the Company in a Place of Payment
for that series, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Securities of any series
(accompanied by any unmatured coupons appertaining thereto), the
Company shall execute and the Trustee shall authenticate and
deliver in exchange therefor a like principal amount of definitive
Securities of the same series of authorized denominations;
provided, however, that no definitive Bearer Security shall be
_________________
delivered in exchange for a temporary Registered Security; and
provided, further, that a definitive Bearer Security shall be
_________________
delivered in exchange for a temporary Bearer Security only in com-
pliance with the conditions set forth in Section 303. Until so
exchanged the temporary Securities of any series shall in all
respects be entitled to the same benefits under this Indenture as
definitive Securities of such series.
If temporary Securities of any series are issued in global form,
any such temporary global Security shall, unless otherwise provided
therein, be delivered to the London office of a depositary or com-
mon depositary (the "Common Depositary"), for the benefit of
Euroclear and CEDEL S.A., for credit to the respective accounts of
the beneficial owners of such Securities (or to such other accounts
as they may direct).
Without unnecessary delay but in any event not later than the date
specified in, or determined pursuant to the terms of, any such tem-
porary global Security (the "Exchange Date"), the Company shall
deliver to the Trustee definitive Securities, in aggregate princi-
pal amount equal to the principal amount of such temporary global
Security, executed by the Company. On or after the Exchange Date
such temporary global Security shall be surrendered by the Common
Depositary to the Trustee, as the Company's agent for such purpose,
to be exchanged, in whole or from time to time in part, for defini-
tive Securities without charge and the Trustee shall authenticate
and deliver, in exchange for each portion of such temporary global
Security, an equal aggregate principal amount of definitive Securi-
ties of the same series of authorized denominations and of like
tenor as the portion of such temporary global Security to be
exchanged. The definitive Securities to be delivered in exchange
for any such temporary global Security shall be in bearer form,
registered form, permanent global bearer form or permanent global
registered form, or any combination thereof, as specified as con-
templated by Section 301, and, if any combination thereof is so
specified, as requested by the beneficial owner thereof; provided,
_________
however, that, unless otherwise specified in such temporary global
_______
Security, upon such presentation by the Common Depositary, such
temporary global Security is accompanied by a certificate dated the
Exchange Date or a subsequent date and signed by Euroclear as to
the portion of such temporary global Security held for its account
then to be exchanged and a certificate dated the Exchange Date or
a subsequent date and signed by CEDEL S.A. as to the portion of
such temporary global Security held for its account then to be
exchanged, each in the form set forth in Exhibit A-2 to this Inden-
ture (or in such other form as may be established pursuant to Sec-
tion 301); and provided, further, that definitive Bearer Securities
_________________
shall be delivered in exchange for a portion of a temporary global
Security only in compliance with the requirements of Section 303.
Unless otherwise specified in such temporary global Security, the
interest of a beneficial owner of Securities of a series in a tem-
porary global Security shall be exchanged for definitive Securities
of the same series and of like tenor following the Exchange Date
when the account holder instructs Euroclear or CEDEL S.A., as the
case may be, to request such exchange on his behalf and delivers to
Euroclear or CEDEL S.A., as the case may be, a certificate in the
form set forth in Exhibit A-1 to this Indenture (or in such other
form as may be established pursuant to Section 301), dated no
earlier than 15 days prior to the Exchange Date, copies of which
certificate shall be available from the offices of Euroclear and
CEDEL S.A., the Trustee, any Authenticating Agent appointed for
such series of Securities and each Paying Agent. Unless otherwise
specified in such temporary global Security, any such exchange
shall be made free of charge to the beneficial owners of such tem-
porary global Security, except that a Person receiving definitive
Securities must bear the cost of insurance, postage, transportation
and the like in the event that such Person does not take delivery
of such definitive Securities in person at the offices of Euroclear
or CEDEL S.A. Definitive Securities in bearer form to be delivered
in exchange for any portion of a temporary global Security shall be
delivered only outside the United States.
Until exchanged in full as hereinabove provided, the temporary
Securities of any series shall in all respects be entitled to the
same benefits under this Indenture as definitive Securities of the
same series and of like tenor authenticated and delivered here-
under, except that, unless otherwise specified as contemplated by
Section 301, interest payable on a temporary global Security on an
Interest Payment Date for Securities of such series occurring prior
to the applicable Exchange Date shall be payable to Euroclear and
CEDEL S.A. on such Interest Payment Date upon delivery by Euroclear
and CEDEL S.A. to the Trustee of a certificate or certificates in
the form set forth in Exhibit A-2 to this Indenture (or in such
other form as may be established pursuant to Section 301), for
credit without further interest on or after such Interest Payment
Date to the respective accounts of the Persons who are the bene-
ficial owners of such temporary global Security on such Interest
Payment Date and who have each delivered to Euroclear or CEDEL
S.A., as the case may be, a certificate dated no earlier than 15
days prior to the Interest Payment Date occurring prior to such
Exchange Date in the form set forth in Exhibit A-1 to this Inden-
ture (or in such other form as may be established pursuant to Sec-
tion 301). Notwithstanding anything to the contrary herein
contained, the certifications made pursuant to this paragraph shall
satisfy the certification requirements of the preceding two para-
graphs of this Section and of the third paragraph of Section 303 of
this Indenture and the interests of the Persons who are the bene-
ficial owners of the temporary global Security with respect to
which such certification was made will be exchanged for definitive
Securities of the same series and of like tenor on the Exchange
Date or the date of certification if such date occurs after the
Exchange Date, without further act or deed by such beneficial
owners. Except as otherwise provided in this paragraph, no pay-
ments or principal or interest owing with respect to a beneficial
interest in a temporary global Security will be made unless and
until such interest in such temporary global Security shall have
been exchanged for an interest in a definitive Security. Any
interest so received by Euroclear and CEDEL S.A. and not paid as
herein provided shall be returned to the Trustee immediately prior
to the expiration of two years after such Interest Payment Date in
order to be repaid to the Company in accordance with Section 1003.
SECTION 305. Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of
the Trustee a register for each series of Securities (the registers
maintained in the Corporate Trust Office of the Trustee and in any
other office or agency of the Company in a Place of Payment being
herein sometimes collectively referred to as the "Security Regis-
ter") in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of Regis-
tered Securities and of transfers of Registered Securities. The
Security Register shall be in written form or any other form cap-
able of being converted into written form within a reasonable time.
At all reasonable times, the Security Register shall be open to
inspection by the Trustee. The Trustee is hereby initially
appointed as security registrar (the "Security Registrar") for the
purpose of registering Registered Securities and transfers of
Registered Securities as herein provided.
Upon surrender for registration of transfer of any Registered
Security of any series at the office or agency in a Place of Pay-
ment for that series, the Company shall execute, and the Trustee
shall authenticate and deliver, in the name of the designated
transferee, one or more new Registered Securities of the same
series, of any authorized denominations and of a like aggregate
principal amount and tenor.
At the option of the Holder, Registered Securities of any series
may be exchanged for other Registered Securities of the same
series, of any authorized denomination and of a like aggregate
principal amount, upon surrender of the Registered Securities to be
exchanged at such office or agency. Whenever any Registered
Securities are so surrendered for exchange, the Company shall
execute, and the Trustee shall authenticate and deliver, the Regis-
tered Securities which the Holder making the exchange is entitled
to receive. Unless otherwise specified with respect to any series
of Securities as contemplated by Section 301, Bearer Securities may
not be issued in exchange for Registered Securities.
If (but only if) expressly permitted in or pursuant to the appli-
cable Board Resolution and (subject to Section 303) set forth in
the applicable Officers' Certificate, or in any indenture supple-
mental hereto, delivered as contemplated by Section 301, at the
option of the Holder, Bearer Securities of any series may be
exchanged for Registered Securities of the same series of any
authorized denomination and of a like aggregate principal amount
and tenor, upon surrender of the Bearer Securities to be exchanged
at any such office or agency, with all unmatured coupons and all
matured coupons in default thereto appertaining. If the Holder of
a Bearer Security is unable to produce any such unmatured coupon or
coupons or matured coupon or coupons in default, any such permitted
exchange may be effected if the Bearer Securities are accompanied
by payment in funds acceptable to the Company in an amount equal to
the face amount of such missing coupon or coupons, or the surrender
of such missing coupon or coupons may be waived by the Company and
the Trustee if there is furnished to them such security or indem-
nity as they may require to save each of them and any Paying Agent
harmless. If thereafter the Holder of such Security shall sur-
render to any Paying Agent any such missing coupon in respect of
which such a payment shall have been made, such Holder shall be
entitled to receive the amount of such payment; provided, however,
_________________
that, except as otherwise provided in Section 1002, interest repre-
sented by coupons shall be payable only upon presentation and sur-
render of those coupons at an office or agency located outside the
United States. Notwithstanding the foregoing, in case a Bearer
Security of any series is surrendered at any such office or agency
in a permitted exchange for a Registered Security of the same
series and like tenor after the close of business at such office or
agency on (i) any Regular Record Date and before the opening of
business at such office or agency on the relevant Interest Payment
Date, or (ii) any Special Record Date and before the opening of
business at such office or agency on the related proposed date for
payment of Defaulted Interest, such Bearer Security shall be sur-
rendered without the coupon relating to such Interest Payment Date
or proposed date for payment, as the case may be, and interest or
Defaulted Interest, as the case may be, will not be payable on such
Interest Payment Date or proposed date for payment, as the case may
be, in respect of the Registered Security issued in exchange for
such Bearer Security, but will be payable only to the Holder of
such coupon when due in accordance with the provisions of this
Indenture.
Whenever any Securities are so surrendered for exchange, the Com-
pany shall execute, and the Trustee shall authenticate and deliver,
the Securities which the Holder making the exchange is entitled to
receive.
Notwithstanding the foregoing, except as otherwise specified as
contemplated by Section 301, any permanent global Security shall be
exchangeable only as provided in this paragraph. If any beneficial
owner of an interest in a permanent global Security is entitled to
exchange such interest for Securities of such series and of like
tenor and principal amount of another authorized form and denomina-
tion, as specified as contemplated by Section 301 and provided that
any applicable notice provided in the permanent global Security
shall have been given, then without unnecessary delay but in any
event not later than the earliest date on which such interest may
be so exchanged, the Company shall deliver to the Trustee defini-
tive Securities in aggregate principal amount equal to the princi-
pal amount of such beneficial owner's interest in such permanent
global Security, executed by the Company. On or after the earliest
date on which such interests may be so exchanged, such permanent
global Security shall be surrendered by the Common Depositary or
such other depositary as shall be specified in the Company Order
with respect thereto to the Trustee, as the Company's agent for
such purpose, to be exchanged, in whole or from time to time in
part, for definitive Securities without charge, and the Trustee
shall authenticate and deliver, in exchange for each portion of
such permanent global Security, an equal aggregate principal amount
of definitive Securities of the same series of authorized denomina-
tions and of like tenor as the portion of such permanent global
Security to be exchanged which, unless the Securities of the series
are not issuable both as Bearer Securities and as Registered
Securities, as specified as contemplated by Section 301, shall be
in the form of Bearer Securities or Registered Securities, or any
combination thereof, as shall be specified by the beneficial owner
thereof; provided, however, that no such exchanges may occur during
_________________
a period beginning at the opening of business 15 days before any
selection of Securities to be redeemed and ending on the relevant
Redemption Date if the Security for which exchange is requested may
be among those selected for redemption; and provided, further, that
_________________
no Bearer Security delivered in exchange for a portion of a per-
manent global Security shall be mailed or otherwise delivered to
any location in the United States. If a Registered Security is
issued in exchange for any portion of a permanent global Security
after the close of business at the office or agency where such
exchange occurs on (i) any Regular Record Date and before the
opening of business at such office or agency on the relevant
Interest Payment Date, or (ii) any Special Record Date and before
the opening of business at such office or agency on the related
proposed date for payment of Defaulted Interest, interest or
Defaulted Interest, as the case may be, will not be payable on such
Interest Payment Date or proposed date for payment, as the case may
be, in respect of such Registered Security, but will be payable on
such Interest Payment Date or proposed date payment, as the case
may be, only to the Person to whom interest in respect of such
portion of such permanent global Security is payable in accordance
with the provisions of this Indenture.
All Securities issued upon any registration of transfer or exchange
of Securities shall be the valid obligations of the Company,
evidencing the same debt, and entitled to the same benefits under
this Indenture, as the Securities surrendered upon such registra-
tion of transfer or exchange.
Every Registered Security presented or surrendered for registration
of transfer or for exchange shall (if so required by the Company or
the Security Registrar) be duly endorsed, or be accompanied by a
written instrument of transfer, in form satisfactory to the Company
and the Security Registrar, duly executed by the Holder thereof or
his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any registration of transfer or
exchange of Securities, other than exchanges pursuant to Section
304, 906, 1107 or 1305 not involving any transfer.
The Company shall not be required (i) to issue, register the trans-
fer of or exchange Securities of any series during a period begin-
ning at the opening of business 15 days before the day of the
selection for redemption of Securities of that series under Section
1103 or 1203 and ending at the close of business on (A) if Securi-
ties of the series are issuable only as Registered Securities, the
date of the mailing of the relevant notice of redemption and (B) if
Securities of the series are issuable as Bearer Securities, the
date of the first publication of the relevant notice of redemption
or, if Securities of the series are also issuable as Registered
Securities and there is no publication, the mailing of the relevant
notice of redemption, or (ii) to register the transfer of or
exchange any Registered Security so selected for redemption in
whole or in part, except the unredeemed portion of any Security
being redeemed in part, or (iii) to exchange any Bearer Security so
selected for redemption except that such a Bearer Security may be
exchanged for a Registered Security of that series and like tenor;
provided that such Registered Security shall be simultaneously sur-
________
rendered for redemption, or (iv) to issue, register the transfer of
or exchange any Security which has been surrendered for repayment
at the option of the Holder, except the portion, if any, of such
Security not to be so repaid.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security or a Security with a mutilated coupon
appertaining to it is surrendered to the Trustee, the Company shall
execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same series and of like tenor and
principal amount and bearing a number not contemporaneously out-
standing, with coupons corresponding to the coupons, if any,
appertaining to the surrendered Security, or, in case any such
mutilated Security or coupon has become or is about to become due
and payable, the Company in its discretion may, instead of issuing
a new Security, with coupons corresponding to the coupons, if any,
appertaining to the surrendered Security, pay such Security or
coupon.
If there shall be delivered to the Company and to the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of
any Security or coupon and (ii) such security or indemnity as may
be required by them to save each of them and any agent of either of
them harmless, then, in the absence of notice to the Company or the
Trustee that such Security or coupon has been acquired by a bona
fide purchaser, the Company shall execute and upon Company Order
the Trustee shall authenticate and deliver, in lieu of any such
destroyed, lost or stolen Security or in exchange for the Security
for which a destroyed, lost or stolen coupon appertains (with all
appurtenant coupons not destroyed, lost or stolen), a new Security
of the same series and of like tenor and principal amount and
bearing a number not contemporaneously outstanding, with coupons
corresponding to the coupons, if any, appertaining to such
destroyed, lost or stolen Security or to the Security to which such
destroyed, lost or stolen coupon appertains, or, in case any such
destroyed, lost or stolen Security or coupon has become or is about
to become due and payable, the Company in its discretion may,
instead of issuing a new Security, with coupons corresponding to
the coupons, if any, appertaining to such destroyed, lost or stolen
Security or to the Security to which such destroyed, lost or stolen
coupon appertains, pay such Security or coupon.
Upon the issuance of any new Security under this Section, the Com-
pany may require the payment of a sum sufficient to cover any tax
or other government charge that may be imposed in relation thereto
and any other expenses (including the fees and expenses of the
Trustee) connected therewith.
Every new Security of any series with its coupons, if any, issued
pursuant to this Section in lieu of any destroyed, lost or stolen
Security or in exchange for a Security to which a destroyed, lost
or stolen coupon appertains, shall constitute an original addi-
tional contractual obligation of the Company, whether or not the
destroyed, lost or stolen Security and its coupons, if any, or the
destroyed, lost or stolen coupon shall be at any time enforceable
by anyone, and shall be entitled to all the benefits of this Inden-
ture equally and proportionately with any and all other Securities
of that series and their coupons, if any, duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen
Securities or coupons.
SECTION 307. Payment of Interest; Interest Rights Preserved;
Optional Interest Reset.
(a) Unless otherwise provided as contemplated by Section 301
with respect to any series of Securities, interest on any
Registered Security which is payable, and is punctually
paid or duly provided for, on any Interest Payment Date
shall be paid to the Person in whose name such Security
(or one or more Predecessor Securities) is registered at
the close of business on the Regular Record Date for such
interest at the office or agency of the Company maintained
for such purpose pursuant to Section 1002; provided, how-
________
ever, that each installment of interest on any Registered
_______
Security may at the Company's option be paid by (i)
mailing a check for such interest, payable to or upon the
written order of the Person entitled thereto pursuant to
Section 309, to the address of such Person as it appears
on the Security Register or (ii) transfer to an account
maintained by the payee located in the United States.
Unless otherwise provided as contemplated by Section 301
with respect to the Securities of any series, payment of
interest may be made, in the case of a Bearer Security, by
transfer to an account maintained by the payee with a bank
located outside the United States.
Unless otherwise provided as contemplated by Section 301,
every permanent global Security in bearer form will pro-
vide that interest, if any, payable on any Interest Pay-
ment Date will be paid to each of Euroclear and CEDEL S.A.
with respect to that portion of such permanent global
Security held for its account by the Common Depositary,
for the purpose of permitting each of Euroclear and CEDEL
S.A. to credit the interest received by it in respect of
such permanent global Security to the accounts of the
beneficial owners thereof.
Any interest on any Registered Security of any series
which is payable, but is not punctually paid or duly pro-
vided for, on any Interest Payment Date shall forthwith
cease to be payable to the Holder on the relevant Regular
Record Date by virtue of having been such Holder, and such
defaulted interest and, if applicable, interest on such
defaulted interest (to the extent lawful) at the rate
specified in the Securities of such series (such defaulted
interest and, if applicable, interest thereon herein
collectively called "Defaulted Interest") may be paid by
the Company, at its election in each case, as provided in
clause (1) or (2) below:
(1) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names the
Registered Securities of such series (or their
respective Predecessor Securities) are registered at
the close of business on a Special Record Date for
the payment of such Defaulted Interest, which shall
be fixed in the following manner. The Company shall
notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Regis-
tered Security of such series and the date of the
proposed payment, and at the same time the Company
shall deposit with the Trustee an amount of money in
the Currency in which the Securities of such series
are payable (except as otherwise specified pursuant
to Section 301 for the Securities of such series and
except, if applicable, as provided in Sections
312(b), 312(d) and 312(e)) equal to the aggregate
amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satis-
factory to the Trustee for such deposit on or prior
to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the
Persons entitled to such Defaulted Interest as in
this clause provided. Thereupon the Trustee shall
fix a Special Record Date for the payment of such
Defaulted Interest which shall be not more than 15
days and not less than 10 days prior to the date of
the proposed payment and not less than 10 days after
the receipt by the Trustee of the notice of the pro-
posed payment. The Trustee shall promptly notify the
Company of such Special Record Date and, in the name
and at the expense of the Company, shall cause notice
of the proposed payment of such Defaulted Interest
and the Special Record Date therefor to be given in
the manner provided in Section 106, not less than 10
days prior to such Special Record Date. Notice of
the proposed payment of such Defaulted Interest and
the Special Record Date therefor having been so
given, such Defaulted Interest shall be paid to the
Persons in whose name the Registered Securities of
such series (or their respective Predecessor Securi-
ties) are registered at the close of business on such
Special Record Date and shall no longer be payable
pursuant to the following clause (2).
(2) The Company may make payment of any Defaulted
Interest on the Registered Securities of any series
in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such
Securities may be listed, and upon such notice as may
be required by such exchange, if, after notice given
by the Company to the Trustee of the proposed payment
pursuant to this clause, such manner of payment shall
be deemed practicable by the Trustee.
(b) The provisions of this Section 307(b) may be made appli-
cable to any series of Securities pursuant to Section 301
(with such modifications, additions or substitutions as
may be specified pursuant to such Section 301). The
interest rate (or the spread or spread multiplier used to
calculate such interest rate, if applicable) on any
Security of such series may be reset by the Company on the
date or dates specified on the face of such Security (each
an "Optional Reset Date"). The Company may exercise such
option with respect to such Security by notifying the
Trustee of such exercise at least 50 but not more than 60
days prior to an Optional Reset Date for such Note. Not
later than 40 days prior to each Optional Reset Date, the
Trustee shall transmit, in the manner provided for in Sec-
tion 106, to the Holder of any such Security a notice (the
"Reset Notice") indicating whether the Company has elected
to reset the interest rate (or the spread or spread multi-
plier used to calculate such interest rate, if appli-
cable), and if so (i) such new interest rate (or such new
spread or spread multiplier, if applicable) and (ii) 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 Date of such Security (each such 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
the Subsequent Interest Period.
Notwithstanding the foregoing, not later than 20 days prior to the
Optional Reset Date, the Company may, at its option, revoke the
interest rate (or the spread or spread multiplier used to calculate
such interest rate, if applicable) provided for in the Reset Notice
and establish an interest rate (or a spread or spread multiplier
used to calculate such interest rate, if applicable) that is higher
than the interest rate (or the spread or spread multiplier, if
applicable) provided for in the Reset Notice, for the Subsequent
Interest Period by causing the Trustee to transmit, in the manner
provided for in Section 106, notice of such higher interest rate
(or such higher spread or spread multiplier, if applicable) to the
Holder of such Security. Such notice shall be irrevocable. All
Securities with respect to which the interest rate (or the spread
or spread multiplier used to calculate such interest rate, if
applicable) is reset on an Optional Reset Date, and with respect to
which the Holders of such Securities have not tendered such Securi-
ties for repayment (or have validly revoked any such tender) pursu-
ant to the next succeeding paragraph, will bear such higher
interest rate (or such higher spread or spread multiplier, if
applicable).
The Holder of any such Security will have the option to elect
repayment by the Company of the principal of such Security on each
Optional Reset Date at a price equal to the principal amount
thereof plus interest accrued to such Optional Reset Date. In
order to obtain repayment on an Optional Reset Date, the Holder
must follow the procedures set forth in Article Thirteen for repay-
ment at the Option of Holders except that the period for delivery
or notification to the Trustee shall be at least 25 but not more
than 35 days prior to such Optional Reset Date and except that, if
the Holder has tendered any Security for repayment pursuant to the
Reset Notice, the Holder may, by written notice to the Trustee,
revoke such tender or repayment until the close of business on the
tenth day before such Optional Reset Date.
SECTION 308. Persons Deemed Owners.
Prior to due presentment of a Registered Security for registration
of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name such Registered
Security is registered as the owner of such Registered Security for
the purpose of receiving payment of principal of (and premium, if
any, on) and (subject to Sections 305 and 307) interest on such
Security and for all other purposes whatsoever, whether or not such
Security be overdue, and none of the Company, the Trustee or any
agent of the Company or the Trustee shall be affected by notice to
the contrary.
Title to any Bearer Security and any coupons appertaining thereto
shall pass by delivery. The Company, the Trustee and any agent of
the Company or the Trustee may treat the bearer of any Bearer
Security and the bearer of any coupon as the absolute owner of such
Security or coupon for the purpose of receiving payment thereof or
on account thereof and for all other purposes whatsoever, whether
or not such Security or coupons be overdue, and none of the Com-
pany, the Trustee or any agent of the Company or the Trustee shall
be affected by notice to the contrary.
None of the Company, the Trustee, any Paying Agent or the Security
Registrar will have any responsibility or liability for any aspect
of the records relating to or payments made on account of bene-
ficial ownership interests of a Security in global form or for
maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.
Notwithstanding the foregoing, with respect to any global Security,
nothing herein shall prevent the Company, the Trustee, or any agent
of the Company or the Trustee, from giving effect to any written
certification, proxy or other authorization furnished by any
depositary, as a Holder, with respect to such global Security or
impair, as between such depositary and owners of beneficial
interests in such global Security, the operation of customary prac-
tices governing the exercise of the rights of such depositary (or
its nominee) as Holder of such global Security.
SECTION 309. Cancellation.
All Securities and coupons surrendered for payment, redemption,
repayment at the option of the Holder, registration of transfer or
exchange or for credit against any current or future sinking fund
payment shall, if surrendered to any Person other than the Trustee,
be delivered to the Trustee. All Securities and coupons so
delivered to the Trustee shall be promptly canceled by it. The
Company may at any time deliver to the Trustee for cancellation any
Securities previously authenticated and delivered hereunder which
the Company may have acquired in any manner whatsoever, and may
deliver to the Trustee (or to any other Person for delivery to the
Trustee) for cancellation any Securities previously authenticated
hereunder which the Company has not issued and sold, and all
Securities so delivered shall be promptly canceled by the Trustee.
If the Company shall so acquire any of the Securities, however,
such acquisition shall not operate as a redemption or satisfaction
of the indebtedness represented by such Securities unless and until
the same are surrendered to the Trustee for cancellation. No
Securities shall be authenticated in lieu of or in exchange for any
Securities canceled as provided in this Section, except as
expressly permitted by this Indenture. All canceled Securities
held by the Trustee shall be disposed of by the Trustee in accor-
dance with its customary procedures and certification of their dis-
posal delivered to the Company unless by Company Order the Company
shall direct that canceled Securities be returned to it.
SECTION 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 with
respect to any Securities, interest, if any, on the Securities of
each series shall be computed on the basis of a 360-day year of
twelve 30-day months.
SECTION 311. Currency and Manner of Payments in Respect of
Securities.
(a) With respect to Registered Securities of any series not
permitting the election provided for in paragraph (b)
below or the Holders of which have not made the election
provided for in paragraph (b) below, and with respect to
Bearer Securities of any series, except as provided in
paragraph (d) below, payment of the principal of (and
premium, if any, on) and interest, if any, on any Regis-
tered or Bearer Security of such series will be made in
the Currency in which such Registered Security or Bearer
Security, as the case may be, is payable. The provisions
of this Section 312 may be modified or superseded with
respect to any Securities pursuant to Section 301.
(b) It may be provided pursuant to Section 301 with respect
to Registered Securities of any series that Holders shall
have the option, subject to paragraphs (d) and (e) below,
to receive payments of principal of (and premium, if any,
on) or interest, if any, on such Registered Securities in
any of the Currencies which may be designated for such
election by delivering to the Trustee a written election
with signature guarantees and in the applicable form
established pursuant to Section 301, not later than the
close of business on the Election Date immediately pre-
ceding the applicable payment date. If a Holder so elects
to receive such payments in any such Currency, such elec-
tion will remain in effect for such Holder or any trans-
feree of such Holder until changed by such Holder or such
transferee by written notice to the Trustee (but any such
change must be made not later than the close of business
on the Election Date immediately preceding the next pay-
ment date to be effective for the payment to be made on
such payment date and no such change of election may be
made with respect to payments to be made on any Registered
Security of such series with respect to which an Event of
Default has occurred or with respect to which the Company
has deposited funds pursuant to Article Four or Fourteen
or with respect to which a notice of redemption has been
given by the Company or a notice of option to elect repay-
ment has been sent by such Holder or such transferee).
Any Holder of any such Registered Security who shall not
have delivered any such election to the Trustee not later
than the close of business on the applicable Election Date
will be paid the amount due on the applicable payment date
in the relevant Currency as provided in Section 312(a).
The Trustee shall notify the Exchange Rate Agent as soon
as practicable after the Election Date of the aggregate
principal amount of Registered Securities for which
Holders have made such written election.
(c) Unless otherwise specified pursuant to Section 301, if the
election referred to in paragraph (b) above has been pro-
vided for pursuant to Section 301, then, unless otherwise
specified pursuant to Section 301, not later than the
fourth Business Day after the Election Date for each pay-
ment date for Registered Securities of any series, the
Exchange Rate Agent will deliver to the Company a written
notice specifying, in the Currency in which Registered
Securities of such series are payable, the respective
aggregate amounts of principal of (and premium, if any,
on) and interest, if any, on the Registered Securities to
be paid on such payment date, specifying the amounts in
such Currency so payable in respect of the Registered
Securities as to which the Holders of Registered Securi-
ties of such series shall have elected to be paid in
another Currency as provided in paragraph (b) above. If
the election referred to in paragraph (b) above has been
provided for pursuant to Section 301 and if at least one
Holder has made such election, then, unless otherwise
specified pursuant to Section 301, on the second Business
Day preceding such payment date the Company will deliver
to the Trustee for such series of Registered Securities an
Exchange Rate Officer's Certificate in respect of the
Dollar or Foreign Currency payments to be made on such
payment date. Unless otherwise specified pursuant to
Section
301, the Dollar or Foreign Currency amount receivable by
Holders of Registered Securities who have elected payment
in a Currency as provided in paragraph (b) above shall be
determined by the Company on the basis of the applicable
Market Exchange Rate in effect on the third Business Day
(the "Valuation Date") immediately preceding each payment
date and such determination shall be conclusive and
binding for all purposes, absent manifest error.
(d) If a Conversion Event occurs with respect to a Foreign
Currency in which any of the Securities are denominated or
payable other than pursuant to an election provided for
pursuant to paragraph (b) above, then with respect to each
date for the payment of principal of (and premium, if any,
on) and interest, if any, on the applicable Securities
denominated or payable in such Foreign Currency occurring
after the last date on which such Foreign Currency was
used (the "Conversion Date"), the Dollar shall be the Cur-
rency of payment for use on each such payment date.
Unless otherwise specified pursuant to Section 301, the
Dollar amount to be paid by the Company to the Trustee and
by the Trustee or any Paying Agent to the Holders of such
Securities with respect to such payment date shall be, in
the case of a Foreign Currency other than a currency unit,
the Dollar Equivalent of the Foreign Currency or, in the
case of a currency unit, the Dollar Equivalent of the Cur-
rency Unit, in each case as determined by the Exchange
Rate Agent in the manner provided in paragraph (f) or (g)
below.
(e) Unless otherwise specified pursuant to Section 301, if
the Holder of a Registered Security denominated in any
Currency shall have elected to be paid in another Currency
as provided in paragraph (b) above, and a Conversion Event
occurs with respect to such elected Currency, such Holder
shall receive payment in the Currency in which payment
would have been made in the absence of such election; and
if a Conversion Event occurs with respect to the Currency
in which payment would have been made in the absence of
such election, such Holder shall receive payment in
Dollars as provided in paragraph (d) above.
(f) The "Dollar Equivalent of the Foreign Currency" shall be
determined by the Exchange Rate Agent and shall be
obtained for each subsequent payment date by converting
the specified Foreign Currency into Dollars at the Market
Exchange Rate on the Conversion Date.
(g) The "Dollar Equivalent of the Currency Unit" shall be
determined by the Exchange Rate Agent and subject to the
provisions of paragraph (h) below shall be the sum of each
amount obtained by converting the Specified Amount of each
Component Currency into Dollars at the Market Exchange
Rate for such Component Currency on the Valuation Date
with respect to each payment.
(h) For purposes of this Section 312 the following terms shall
have the following meanings:
A "Component Currency" shall mean any Currency which, on
the Conversion Date, was a component currency of the rele-
vant currency unit, including, but not limited to, the
ECU.
A "Specified Amount" of a Component Currency shall mean
the number of units of such Component Currency or frac-
tions thereof which were represented in the relevant cur-
rency unit, including, but not limited to, the ECU, on the
Conversion Date. If after the Conversion Date the
official unit of any Component Currency is altered by way
of combination or subdivision, the Specified Amount of
such Component Currency shall be divided or multiplied in
the same proportion. If after the Conversion Date two or
more Component Currencies are consolidated into a single
currency, the respective Specified Amounts of such Compo-
nent Currencies shall be replaced by an amount in such
single Currency equal to the sum of the respective Speci-
fied Amounts of such consolidated Component Currencies
expressed in such single Currency, and such amount shall
thereafter be a Specified Amount and such single Currency
shall thereafter be a Component Currency. If after the
Conversion Date any Component Currency shall be divided
into two or more currencies, the Specified Amount of such
Component Currency shall be replaced by amounts of such
two or more currencies, having an aggregate Dollar Equiva-
lent value at the Market Exchange Rate on the date of such
replacement equal to the Dollar Equivalent value of the
Specified Amount of such former Component Currency at the
Market Exchange Rate immediately before such division and
such amounts shall thereafter be Specified Amounts and
such currencies shall thereafter be Component Currencies.
If, after the Conversion Date of the relevant currency
unit, including, but not limited to, the ECU, a Conversion
Event (other than any event referred to above in this
definition of "Specified Amount") occurs with respect to
any Component Currency of such currency unit and is con-
continuing on the applicable Valuation Date, the Specified
Amount of such Component Currency shall, for purposes of
calculating the Dollar Equivalent of the Currency Unit, be
converted into Dollars at the Market Exchange Rate in
effect on the Conversion Date of such Component Currency.
"Election Date" shall mean the date for any series of
Registered Securities as specified pursuant to clause (13)
of Section 301 by which the written election referred to
in paragraph (b) above may be made.
All decisions and determinations of the Exchange Rate Agent
regarding the Dollar Equivalent of the Foreign Currency, the Dollar
Equivalent of the Currency Unit, the Market Exchange Rate and
changes in the Specified Amounts as specified above shall be in its
sole discretion and shall, in the absence of manifest error, be
conclusive for all purposes and irrevocably binding upon the Com-
pany, the Trustee and all Holders of such Securities denominated or
payable in the relevant Currency. The Exchange Rate Agent shall
promptly give written notice to the Company and the Trustee of any
such decision or determination.
In the event that the Company determines in good faith that a Con-
version Event has occurred with respect to a Foreign Currency, the
Company will immediately give written notice thereof to the Trustee
and to the Exchange Rate Agent (and the Trustee will promptly
thereafter give notice in the manner provided for in Section 106 to
the affected Holders) specifying the Conversion Date. In the event
the Company so determines that a Conversion Event has occurred with
respect to the ECU or any other currency unit in which Securities
are denominated or payable, the Company will immediately give
written notice thereof to the Trustee and to the Exchange Rate
Agent (and the Trustee will promptly thereafter give notice in the
manner provided for in Section 106 to the affected Holders)
specifying the Conversion Date and the Specified Amount of each
Component Currency on the Conversion Date. In the event the Com-
pany determines in good faith that any subsequent change in any
Component Currency as set forth in the definition of Specified
Amount above has occurred, the Company will similarly give written
notice to the Trustee and the Exchange Rate Agent.
The Trustee shall be fully justified and protected in relying and
acting upon information received by it from the Company and the
Exchange Rate Agent and shall not otherwise have any duty or
obligation to determine the accuracy or validity of such informa-
tion independent of the Company or the Exchange Rate Agent.
SECTION 312. Appointment and Resignation of Successor Exchange
Rate Agent.
(a) Unless otherwise specified pursuant to Section 301, if and
so long as the Securities of any series (i) are denomi-
nated in a Currency other than Dollars or (ii) may be pay-
able in a Currency other than Dollars, or so long as it is
required under any other provision of this Indenture, then
the Company will maintain with respect to each such series
of Securities, or as so required, at least one Exchange
Rate Agent. The Company will cause the Exchange Rate
Agent to make the necessary foreign exchange determina-
tions at the time and in the manner specified pursuant to
Section 301 for the purpose of determining the applicable
rate of exchange and, if applicable, for the purpose of
converting the issued Currency into the applicable payment
Currency for the payment of principal (and premium, if
any) and interest, if any, pursuant to Section 312.
(b) No resignation of the Exchange Rate Agent and no appoint-
ment of a successor Exchange Rate Agent pursuant to this
Section shall become effective until the acceptance of
appointment by the successor Exchange Rate Agent as
evidenced by a written instrument delivered to the Company
and the Trustee.
(c) If the Exchange Rate Agent shall resign, be removed or
become incapable of acting, or if a vacancy shall occur in
the office of the Exchange Rate Agent for any cause with
respect to the Securities of one or more series, the
Company, by or pursuant to a Board Resolution, shall
promptly appoint a successor Exchange Rate Agent or
Exchange Rate Agents with respect to the Securities of
that or those series (it being understood that any such
successor Exchange Rate Agent may be appointed with
respect to the Securities of one or more or all of such
series and that, unless otherwise specified pursuant to
Section 301, at any time there shall only be one Exchange
Rate Agent with respect to the Securities of any particu-
lar series that are originally issued by the Company on
the same date and that are initially denominated and/or
payable in the same Currency).
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further
effect with respect to any series of Securities specified in such
Company Request (except as to any surviving rights of registration
of transfer or exchange of Securities of such series herein
expressly provided for and the obligation of the Company to pay any
Additional Amounts as contemplated by Section 1005) and the
Trustee, at the expense of the Company, shall execute proper
instruments acknowledging satisfaction and discharge of this Inden-
ture as to such series when
(1) either
(A) all Securities of such series theretofore authenti-
cated and delivered and all coupons, if any, apper-
taining thereto (other than (i) coupons appertaining
to Bearer Securities surrendered for exchange for
Registered Securities and maturing after such
exchange, whose surrender is not required or has been
waived as provided in Section 305, (ii) Securities
and coupons of such series which have been destroyed,
lost or stolen and which have been replaced or paid
as provided in Section 306, (iii) coupons apper-
taining to Securities called for redemption and
maturing after the relevant Redemption Date, whose
surrender has been waived as provided in Section
1106, and (iv) Securities and coupons of such series
for whose payment money has theretofore been
deposited in trust with the Trustee or any Paying
Agent or segregated and held in trust by the Company
and thereafter repaid to the Company, as provided in
Section 1003) have been delivered to the Trustee for
cancellation; or
(B) all Securities of such series and, in the case of (i)
or (ii) below, any coupons appertaining thereto not
theretofore delivered to the Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated
Maturity within one year, or
(iii) if redeemable at the option of the Company, are
to be called for redemption within one year
under arrangements satisfactory to the Trustee
for the giving of notice of redemption by the
Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of (i), (ii) or (iii)
above, has irrevocably deposited or caused to be
deposited with the Trustee as trust funds in trust
for such purpose an amount in the Currency in which
the Securities of such series are payable, suffi-
cient to pay and discharge the entire indebtedness on
such Securities not theretofore delivered to the
Trustee for cancellation, for principal (and premium,
if any) and interest to the date of such deposit (in
the case of Securities which have become due and pay-
payable) or to the Stated Maturity or Redemption
Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that
all conditions precedent herein provided for relating to
the satisfaction and discharge of this Indenture as to
such series have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture,
the obligations of the Company to the Trustee under Section 606,
the obligations of the Trustee to any Authenticating Agent under
Section 611 and, if money shall have been deposited with the
Trustee pursuant to subclause (B) of clause (1) of this Section,
the obligations of the Trustee under Section 402 and the last para-
graph of Section 1003 shall survive.
SECTION 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003,
all money deposited with the Trustee pursuant to Section 401 shall
be held in trust and applied by it, in accordance with the provi-
sions of the Securities, the coupons and this Indenture, to the
payment either directly or through any Paying Agent (including the
Company acting as its own Paying Agent) as the Trustee may deter-
mine, to the Persons entitled thereto, of the principal (and pre-
mium, if any) and interest for whose payment such money has been
deposited with the Trustee; but such money need not be segregated
from other funds except to the extent required by law.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default", wherever used herein with respect to Securities
of any series, means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to
any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(1) default in the payment of any interest on any Security
of that series, or any related coupon, when such interest
or coupon becomes due and payable, and continuance of such
default for a period of 30 days; provided, that, if
Securities are issued to a Southern Union Trust or a
trustee of such trust in connection with the issuance of
Trust Securities by such trust, such thirty (30) day
period will be replaced by a ten (10) day period; or
(2) default in the payment of the principal of (or premium,
if any, on) any Security of that series at its Maturity;
provided, however, that a valid extension of the maturity
of such Securities in accordance with the terms of any
indenture supplemental hereto shall not constitute a de-
fault in the payment of principal or premium, if any; or
(3) default in the deposit of any sinking fund payment, when
and as due by the terms of the Securities of that series
and Article 12; or
(4) default in the performance, or breach, of any covenant or
agreement of the Company in this Indenture which affects
or is applicable to the Securities of that series (other
than a default in the performance, or breach of a covenant
or agreement which is specifically dealt with elsewhere in
this Section or which has expressly been included in this
Indenture solely for the benefit of one or more series of
Securities other than that series), and continuance of
such default or breach for a period of 60 days after there
has been given, by registered or certified mail, to the
Company by the Trustee or to the Company and the Trustee
by the Holders of at least 25% in principal amount of all
Outstanding Securities of that series a written notice
specifying such default or breach and requiring it to be
remedied and stating that such notice is a "Notice of
Default" hereunder; or
(5) the entry of a decree or order by a court having juris-
diction in the premises adjudging the Company a bankrupt
or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or com-
position of or in respect of the Company under the Federal
Bankruptcy Code or any other applicable federal or state
law, or appointing a receiver, liquidator, assignee,
trustee, sequestrator (or other similar official) of the
Company or of any substantial part of its property, or
ordering the winding up or liquidation of its affairs,
and the continuance of any such decree or order unstayed
and in effect for a period of 90 consecutive days; or
(6) in the event Securities are issued and sold to a Southern
Union Trust or a trustee of such trust in connection with
the issuance of Trust Securities by such Southern Union
Trust, such Southern Union Trust shall have voluntarily or
involuntarily dissolved, wound-up its business or other-
wise terminated its existence except in connection with
(i) the distribution of Securities to holders of Trust
Securities in liquidation or redemption of their interests
in such Southern Union Trust, (ii) the redemption of all
of the outstanding Trust Securities of such Southern Union
Trust or (iii) certain mergers, consolidations or amalga-
mations, each as permitted by the Declaration of such
Southern Union Trust.
(7) the institution by the Company of proceedings to be
adjudicated a bankrupt or insolvent, or the consent by it
to the institution of bankruptcy or insolvency proceedings
against it, or the filing by it of a petition or answer or
consent seeking reorganization or relief under the Federal
Bankruptcy Code or any other applicable federal or state
law, or the consent by it to the filing of any such peti-
tion or to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator (or other similar
official) of the Company or of any substantial part of its
property, or the making by it of an assignment for the
benefit of creditors, or the admission by it in writing of
its inability to pay its debts generally as they become
due; or
(8) there shall have occurred one or more defaults by the Com-
pany or any Subsidiary in the payment of the principal of
(or premium, if any, on) Debt in excess of 10% of Consoli-
dated Net Worth under one or more agreements, indentures
or instruments and either (i) such Debt has already become
due and payable in full at the stated maturity thereof or
(ii) such default or defaults results in the acceleration
of the maturity of such Debt; or
(9) any other Event of Default provided with respect to
Securities of that series.
SECTION 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default described in clause (1), (2), (3), (4), (7)
or (8) of Section 501 with respect to Securities of any series at
the time Outstanding occurs and is continuing, then in every such
case the Trustee or the Holders of not less than 25% in principal
amount of the Outstanding Securities of that series may declare the
principal amount (or, if the Securities of that series are Original
Issue Discount Securities or Indexed Securities, such portion of
the principal amount as may be specified in the terms of that
series) of all of the Securities of that series to be due and pay-
able immediately, by a notice in writing to the Company (and to the
Trustee if given by Holders), and upon any such declaration such
principal amount (or specified portion thereof) shall become
immediately due and payable. If an Event of Default specified in
Section 501(5) or 501(6) occurs and is continuing, then the prin-
cipal amount of all the Securities shall ipso facto become and be
immediately due and payable without any declaration or other act on
the part of the Trustee or any Holder.
At any time after a declaration of acceleration with respect to
Securities of any series (or of all series, as the case may be) has
been made and before a judgment or decree for payment of the money
due has been obtained by the Trustee as hereinafter provided in
this Article, the Holders of a majority in principal amount of the
Outstanding Securities of that series (or of all series, as the
case may be), by written notice to the Company and the Trustee, may
rescind and annul such declaration and its consequences if
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay in the Currency in which the Securities
of such series are payable (except as otherwise specified
pursuant to Section 301 for the Securities of such series
and except, if applicable, as provided in Sections 312(b),
312(d) and 312(e)),
(A) all overdue interest on all Outstanding Securities of
that series (or of all series, as the case may be)
and any related coupons,
(B) all unpaid principal of (and premium, if any, on) any
Outstanding Securities of that series (or of all
series, as the case may be) which has become due
otherwise than by such declaration of acceleration,
and interest on such unpaid principal at the rate or
rates prescribed therefor in such Securities,
(C) interest on overdue interest at the rate or rates
prescribed therefor in such Securities, and
(D) all sums paid or advanced by the Trustee hereunder
and the reasonable compensation, expenses, disburse-
ments and advances of the Trustee, its agents and
counsel; and
(2) all Events of Default with respect to Securities of that
series (or of all series, as the case may be), other than
the non-payment of amounts of principal of (or premium, if
any, on) or interest on Securities of that series (or of
all series, as the case may be) which have become due
solely by such declaration of acceleration, have been
cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair
any right consequent thereon.
Notwithstanding the preceding paragraph, in the event of a declara-
tion of acceleration in respect of the Securities because of an
Event of Default specified in Section 501(7) shall have occurred
and be continuing, such declaration of acceleration shall be
automatically annulled if the Debt that is the subject of such
Event of Default has been discharged or the holders thereof have
rescinded their declaration of acceleration in respect of such
Debt, and written notice of such discharge or rescission, as the
case may be, shall have been given to the Trustee by the Company
and countersigned by the holders of such Debt or a trustee,
fiduciary or agent for such holders, within 30 days after such
declaration of acceleration in respect of the Securities, and no
other Event of Default has occurred during such 30-day period which
has not been cured or waived during such period.
SECTION 503. Collection of Indebtedness and Suits for Enforcement
by Trustee.
The Company covenants that if
(1) default is made in the payment of any installment of
interest on any Security and any related coupon when such
interest becomes due and payable and such default con-
tinues for a period of 30 days or 10 days in the case of
Securities issued to a Southern Union Trust or a trustee
of such trust, or
(2) default is made in the payment of the principal of (or
premium, if any, on) any Security at the Maturity thereof,
then the Company will, upon demand of the Trustee, pay to the
Trustee for the benefit of the Holders of such Securities and
coupons, the whole amount then due and payable on such Securities
and coupons for principal (and premium, if any) and interest, and
interest on any overdue principal (and premium, if any) and on any
overdue interest, at the rate or rates prescribed therefor in such
Securities, and, in addition thereto, such further amount as shall
be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name as trustee of an express
trust, may institute a judicial proceeding for the collection of
the sums so due and unpaid, may prosecute such proceeding to
judgment or final decree and may enforce the same against the Com-
pany or any other obligor upon such Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by
law out of the property of the Company or any other obligor upon
such Securities, wherever situated.
If an Event of Default with respect to Securities of any series (or
of all series, as the case may be) occurs and is continuing, the
Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders of Securities of such series
(or of all series, as the case may be) by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and
enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exer-
cise of any power granted herein, or to enforce any other proper
remedy.
SECTION 504. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquida-
tion, bankruptcy, reorganization, arrangement, adjustment, com-
position or other judicial proceeding relative to the Company or
any other obligor upon the Securities or the property of the
Company or of such other obligor or their creditors, the Trustee
(irrespective of whether the principal of the Securities shall then
be due and payable as therein expressed or by declaration or other-
wise and irrespective of whether the Trustee shall have made any
demand on the Company for the payment of overdue principal, pre-
mium, if any, or interest) shall be entitled and empowered, by
intervention in such proceeding or otherwise,
(i) to file and prove a claim for the whole amount of princi-
pal (and premium, if any), or such portion of the princi-
pal amount of any series of Original Issue Discount
Securities or Indexed Securities as may be specified in
the terms of such series, and interest owing and unpaid in
respect of the Securities and to file such other papers or
documents as may be necessary or advisable in order to
have the claims of the Trustee (including any claim for
the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel) and of
the Holders allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other property pay-
able or deliverable on any such claims and to distribute
the same;
and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial pro-
ceeding is hereby authorized by each Holder to make such payments
to the Trustee and, in the event that the Trustee shall consent to
the making of such payments directly to the Holders, to pay to the
Trustee any amount due it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and
counsel, and any other amounts due the Trustee under Section 606.
Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or com-
position affecting the Securities or the rights of any Holder
thereof or to authorize the Trustee to vote in respect of the claim
of any Holder in any such proceeding.
SECTION 505. Trustee May Enforce Claims Without Possession of
Securities.
All rights of action and claims under this Indenture or the Securi-
ties or coupons may be prosecuted and enforced by the Trustee with-
out the possession of any of the Securities or coupons or the
production thereof in any proceeding relating thereto, and any such
proceeding instituted by the Trustee shall be brought in its own
name as trustee of an express trust, and any recovery of judgment
shall, after provision for the payment of the reasonable compensa-
tion, expenses, disbursements and advances of the Trustee, its
agents and counsel, be for the ratable benefit of the Holders of
the Securities and coupons in respect of which such judgment has
been recovered.
SECTION 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall
be applied in the following order, at the date or dates fixed by
the Trustee and, in case of the distribution of such money on
account of principal (or premium, if any) or interest, upon presen-
tation of the Securities or coupons, or both, as the case may be,
and the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid:
First: To the payment of all amounts due the Trustee under
Section 606;
Second: To the payment of the amounts then due and unpaid for
principal of (and premium, if any, on) and interest on
the Securities and coupons in respect of which or for
the benefit of which such money has been collected,
ratably, without preference or priority of any kind,
according to the amounts due and payable on such
Securities and coupons for principal (and premium, if
any) and interest, respectively; and
Third: The balance, if any, to the Company or any other Per-
son or Persons entitled thereto.
SECTION 507. Limitation on Suits.
No Holder of any Security of any series or any related coupons
shall have any right to institute any proceeding, judicial or
otherwise, with respect to this Indenture, or for the appointment
of a receiver or trustee, or for any other remedy hereunder, unless
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to
the Securities of that series;
(2) the Holders of not less than 25% in principal amount of
the Outstanding Securities of that series in the case of
any event of Default described in clause (1), (2), (3),
(4), (7) or (8) of Section 501, or, in the case of any
Event of Default described in clause (5) or (6) of Section
501, the Holders of not less than 25% in principal amount
of all Outstanding Securities, shall have made written
request to the Trustee to institute proceedings in respect
of such Event of Default in its own name as Trustee
hereunder;
(3) such Holder or Holders have offered to the Trustee reason-
able indemnity against the costs, expenses and liabilities
to be incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any
such proceeding; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the
Holders of a majority or more in principal amount of the
Outstanding Securities of that series in the case of any
Event of Default described in clause (1), (2), (3), (4),
(7) or (8) of Section 501, or, in the case of any Event of
Default described in clause (5) or (6) of Section 501, by
the Holders of a majority or more in principal amount of
all Outstanding Securities;
it being understood and intended that no one or more of such
Holders shall have any right in any manner whatever by virtue of,
or by availing of, any provision of this Indenture to affect, dis-
turb or prejudice the rights of any other Holders of Securities of
the same series, in the case of any Event of Default described in
clause (1), (2), (3), (4), (7) or (8) of Section 501, or of Holders
of all Securities in the case of any Event of Default described in
clause (5) or (6) of Section 501, or to obtain or to seek to obtain
priority or preference over any other of such Holders or to enforce
any right under this Indenture, except in the manner herein pro-
vided and for the equal and ratable benefit of all Holders of
Securities of the same series, in the case of any Event of Default
described in clause (1), (2), (3), (4), (7) or (8) of Section 501,
or of Holders of all Securities in the case of any Event of Default
described in clause (5) or (6) of Section 501.
SECTION 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest.
Notwithstanding any other provision in this Indenture, the Holder
of any Security shall have the right, which is absolute and uncon-
ditional, to receive payment, as provided herein (including, if
applicable, Article Fourteen) and in such Security, of the princi-
pal of (and premium, if any, on) and (subject to Section 307)
interest on, such Security or payment of such coupon on the
respective Stated Maturities expressed in such Security or coupon
(or, in the case of redemption, on the Redemption Date) and to
institute suit for the enforcement of any such payment, and such
rights shall not be impaired without the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such pro-
ceeding has been discontinued or abandoned for any reason, or has
been determined adversely to the Trustee or to such Holder, then
and in every such case, subject to any determination in such pro-
ceeding, the Company, the Trustee and the Holders of Securities and
coupons shall be restored severally and respectively to their
former positions hereunder and thereafter all rights and remedies
of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
SECTION 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities or
coupons in the last paragraph of Section 306, no right or remedy
herein conferred upon or reserved to the Trustee or to the Holders
of Securities or coupons is intended to be exclusive of any other
right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other
right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right
or remedy.
SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any
Security or coupon to exercise any right or remedy accruing upon
any Event of Default shall impair any such right or remedy or con-
stitute a waiver of any such Event of Default or an acquiescence
therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time,
and as often as may be deemed expedient, by the Trustee or by the
Holders, as the case may be.
SECTION 512. Control by Holders.
With respect to the Securities of any series, the Holders of not
less than a majority in principal amount of the Outstanding Securi-
ties of such series shall have the right to direct the time, method
and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred on the
Trustee relating to or arising under clause (1), (2), (3), (4), (7)
or (8) of Section 501, and, with respect to all Securities, the
Holders of not less than a majority in principal amount of all Out-
standing Securities shall have the right to direct the time, method
and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred on the
Trustee, not relating to or arising under clause (1), (2), (3),
(4), (7) or (8) of Section 501, provided that in each case
(1) such direction shall not be in conflict with any rule of
law or with this Indenture,
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction, and
(3) the Trustee need not take any action which might involve
it in personal liability or be unjustly prejudicial to the
Holders of Securities of such series not consenting.
SECTION 513. Waiver of Past Defaults.
Subject to Section 502, the Holders of not less than a majority in
principal amount of the Outstanding Securities of any series may on
behalf of the Holders of all the Securities of such series waive
any past default described in clause (1), (2), (3), (4), (7) or (8)
of Section 501 (or, in the case of a default described in clause
(5) or (6) of Section 501, the Holders of not less than a majority
in principal amount of all Outstanding Securities may waive any
such past default), and its consequences, except a default
(1) in respect of the payment of the principal of (or premium,
if any, on) or interest on any Security or any related
coupon, or
(2) in respect of a covenant or provision hereof which under
Article Nine cannot be modified or amended without the
consent of the Holder of each Outstanding Security of such
series affected.
Upon any such waiver, any such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been
cured, for every purpose of this Indenture; but no such waiver
shall extend to any subsequent or other default or Event of Default
or impair any right consequent thereon.
SECTION 514. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, or plead, or in any man-
ner whatsoever claim or take the benefit or advantage of, any stay
or extension law wherever enacted, now or at any time hereafter in
force, which may affect the covenants or the performance of this
Indenture; and the Company (to the extent that it may lawfully do
so) hereby expressly waives all benefit or advantage of any such
law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suf-
fer and permit the execution of every such power as though no such
law had been enacted.
ARTICLE SIX
THE TRUSTEE
SECTION 601. Notice of Defaults.
Within 90 days after the occurrence of any Default hereunder with
respect to the Securities of any series, the Trustee shall transmit
in the manner and to the extent provided in TIA Section 313(c),
notice of such default hereunder known to the Trustee, unless such
Default shall have been cured or waived; provided, however, that,
_________________
except in the case of a Default in the payment of the principal of
(or premium, if any, on) or interest on any Security of such series
or in the payment of any sinking fund installment with respect to
Securities of such series, the Trustee shall be protected in with-
holding such notice if and so long as the board of directors, the
executive committee or a trust committee of directors and/or
Responsible Officers of the Trustee in good faith determine that
the withholding of such notice is in the interest of the Holders of
Securities of such series and any related coupons; and provided,
________
further, that in the case of any Default of the character specified
_______
in Section 501(3) with respect to Securities of such series, no
such notice to Holders shall be given until at least 30 days after
the occurrence thereof.
SECTION 602. Certain Rights of Trustee.
Subject to the provisions of TIA Sections 315(a) through 315(d):
(1) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or
Company Order and any resolution of the Board of Directors
may be sufficiently evidenced by a Board Resolution;
(3) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any
action hereunder, the Trustee (unless other evidence be
herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officers' Certificate;
(4) the Trustee may consult with counsel and the written
advice of such counsel or any Opinion of Counsel shall be
full and complete authorization and protection in respect
of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(5) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at
the request or direction of any of the Holders of Securi-
ties of any series or any related coupons pursuant to this
Indenture, unless such Holders shall have offered to the
Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by
it in compliance with such request or direction;
(6) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, cer-
tificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document,
but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it
may see fit, and, if the Trustee shall determine to make
such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the
Company, personally or by agent or attorney;
(7) the Trustee may execute any of the trusts or powers here-
under or perform any duties hereunder either directly or
by or through agents or attorneys and the Trustee shall
not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by
it hereunder; and
(8) the Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and believed by it
to be authorized or within the discretion or rights or
powers conferred upon it by this Indenture.
The Trustee shall not be required to expend or risk its own funds
or otherwise incur any financial liability in the performance of
any of its duties hereunder, or in the exercise of any of its
rights or powers if it shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it.
SECTION 603. Trustee Not Responsible for Recitals or Issuance of
Securities.
The recitals contained herein and in the Securities, except for the
Trustee's certificates of authentication, and in any coupons shall
be taken as the statements of the Company, and neither the Trustee
nor any Authenticating Agent assumes any responsibility for their
correctness. The Trustee makes no representations as to the
validity or sufficiency of this Indenture or of the Securities or
coupons, except that the Trustee represents that it is duly autho-
rized to execute and deliver this Indenture, authenticate the
Securities and perform its obligations hereunder and that the
statements made by it in a Statement of Eligibility on Form T-1
supplied to the Company are true and accurate, subject to the
qualifications set forth therein. Neither the Trustee nor any
Authenticating Agent shall be accountable for the use or applica-
tion by the Company of Securities or the proceeds thereof.
SECTION 604. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any
Security Registrar or any other agent of the Company or of the
Trustee, in its individual or any other capacity, may become the
owner or pledgee of Securities and coupons and, subject to TIA
Sections 310(b) and 311, may otherwise deal with the Company with
the same rights it would have if it were not Trustee, Authenti-
cating Agent, Paying Agent, Security Registrar or such other agent.
SECTION 605. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by
it hereunder except as otherwise agreed with the Company.
SECTION 606. Compensation and Reimbursement.
The Company agrees:
(1) to pay to the Trustee from time to time reasonable compen-
sation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law
in regard to the compensation of a trustee of an express
trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by
the Trustee in accordance with any provision of this
Indenture (including the reasonable compensation and the
expenses and disbursements of its agents and counsel),
except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of the
trust or trusts hereunder, including the costs and
expenses of defending itself against any claim or lia-
bility in connection with the exercise or performance of
any of its powers or duties hereunder.
The obligations of the Company under this Section to compensate the
Trustee, to pay or reimburse the Trustee for expenses, disburse-
ments and advances and to indemnify and hold harmless the Trustee
shall constitute additional indebtedness hereunder and shall sur-
vive the satisfaction and discharge of this Indenture. As security
for the performance of such obligations of the Company, the Trustee
shall have a claim prior to the Securities upon all property and
funds held or collected by the Trustee as such, except funds held
in trust for the payment of principal of (and premium, if any, on)
or interest on particular Securities or any coupons.
SECTION 607. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be
eligible to act as Trustee under TIA Section 310(a)(1) and shall
have a combined capital and surplus of at least $50,000,000. If
such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of Federal, State, terri-
torial or District of Columbia supervising or examining authority,
then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of con-
dition so published. If at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section, it
shall resign immediately in the manner and with the effect herein-
after specified in this Article.
SECTION 608. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appoint-
ment of a successor Trustee pursuant to this Article shall
become effective until the acceptance of appointment by
the successor Trustee in accordance with the applicable
requirements of Section 609.
(b) The Trustee may resign at any time with respect to the
Securities of one or more series by giving written notice
thereof to the Company. If the instrument of acceptance
by a successor Trustee required by Section 609 shall not
have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction
for the appointment of a successor Trustee with respect to
the Securities of such series.
(c) The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of not less
than a majority in principal amount of the Outstanding
Securities of such series, delivered to the Trustee and to
the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with the provisions
of TIA Section 310(b) after written request therefor
by the Company or by any Holder who has been a bona
fide Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section
607 and shall fail to resign after written request
therefor by the Company or by any Holder who has been
a bona fide Holder of a Security for at least six
months, or
(3) the Trustee shall become incapable of acting or shall
be adjudged a bankrupt or insolvent or a receiver of
the Trustee or of its property shall be appointed or
any public officer shall take charge or control of
the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquida-
tion,
then, in any such case, (i) the Company, by a Board
Resolution, may remove the Trustee with respect to all
Securities, or (ii) subject to TIA Section 315(e), any
Holder who has been a bona fide Holder of a Security for
at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee with respect
to all Securities and the appointment of a successor
Trustee or Trustees.
(e) If the Trustee shall resign, be removed or become incap-
able of acting, or if a vacancy shall occur in the office
of Trustee for any cause, with respect to the Securities
of one or more series, the Company, by a Board Resolution,
shall promptly appoint a successor Trustee or Trustees
with respect to the Securities of that or those series (it
being understood that any such successor Trustee may be
appointed with respect to the Securities of one or more or
all of such series and that at any time there shall be
only one Trustee with respect to the Securities of any
particular series). If, within one year after such
resignation, removal or incapability, or the occurrence of
such vacancy, a successor Trustee with respect to the
Securities of any series shall be appointed by Act of the
Holders of a majority in principal amount of the Out-
standing Securities of such series delivered to the Com-
pany and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such
appointment, become the successor Trustee with respect to
the Securities of such series and to that extent supersede
the successor Trustee appointed by the Company. If no
successor trustee with respect to the Securities of any
series shall have been so appointed by the Company or the
Holders and accepted appointment in the manner hereinafter
provided, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on
behalf of himself and all others similarly situated, peti-
tion any court of competent jurisdiction for the appoint-
ment of a successor Trustee with respect to the Securities
of such series.
(f) The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of
any series and each appointment of a successor Trustee
with respect to the Securities of any series to the
Holders of Securities of such series in the manner pro-
vided for in Section 106. Each notice shall include the
name of the successor Trustee with respect to the Securi-
ties of such series and the address of its Corporate Trust
Office.
SECTION 609. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor
Trustee with respect to all Securities, every such suc-
cessor Trustee so appointed shall execute, acknowledge and
deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall
become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring
Trustee; but, on the request of the Company or the suc-
cessor Trustee, such retiring Trustee shall, upon payment
of its charges, execute and deliver an instrument trans-
ferring to such successor Trustee all the rights, powers
and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor Trustee all
property and money held by such retiring Trustee here-
under.
(b) In case of the appointment hereunder of a successor
Trustee with respect to the Securities of one or more (but
not all) series, the Company, the retiring Trustee and
each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall
accept such appointment and which (1) shall contain such
provisions as shall be necessary or desirable to transfer
and confirm to, and to vest in, each successor Trustee all
the rights, powers, trusts and duties of the retiring
Trustee with respect to the Securities of that or those
series to which the appointment of such successor Trustee
relates, (2) if the retiring Trustee is not retiring with
respect to all Securities, shall contain such provisions
as shall be deemed necessary or desirable to confirm that
all the rights, powers, trusts and duties of the retiring
Trustee with respect to the Securities of that or those
series as to which the retiring Trustee is not retiring
shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facili-
tate the administration of the trusts hereunder by more
than one Trustee, it being understood that nothing herein
or in such supplemental indenture shall constitute such
Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder
separate and apart from any trust or trusts hereunder
administered by any other such Trustee; and upon the
execution and delivery of such supplemental indenture the
resignation or removal of the retiring Trustee shall
become effective to the extent provided therein and each
such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series to which
the appointment of such successor Trustee relates; but, on
request of the Company or any successor Trustee, such
retiring Trustee shall duly assign, transfer and deliver
to such successor Trustee all property and money held by
such retiring Trustee hereunder with respect to the
Securities of that or those series to which the appoint-
ment of such successor Trustee relates. Whenever there is
a successor Trustee with respect to one or more (but less
than all) series of securities issued pursuant to this
Indenture, the terms "Indenture" and "Securities" shall
have the meanings specified in the provisos to the
respective definitions of those terms in Section 101 which
contemplate such situation.
(c) Upon request of any such successor Trustee, the Company
shall execute any and all instruments for more fully and
certainly vesting in and confirming to such successor
Trustee all rights, powers and trusts referred to in
paragraph (a) or (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless
at the time of such acceptance such successor Trustee
shall be qualified and eligible under this Article.
SECTION 610. Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Trustee may be merged or converted
or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee
shall be a party, or any corporation succeeding to all or substan-
tially all the corporate trust business of the Trustee, shall be
the successor of the Trustee hereunder, provided such corporation
shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on
the part of any of the parties hereto. In case any Securities
shall have been authenticated, but not delivered, by the Trustee
then in office, any successor by merger, conversion or consolida-
tion to such authenticating Trustee may adopt such authentication
and deliver the Securities so authenticated with the same effect as
if such successor Trustee had itself authenticated such Securities;
and in case at that time any of the Securities shall not have been
authenticated, any successor Trustee may authenticate such Securi-
ties either in the name of any predecessor hereunder or in the name
of the successor Trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the Securities or
in this Indenture provided that the certificate of the Trustee
shall have; provided, however, that the right to adopt the certifi-
_________________
cate of authentication of any predecessor Trustee or to authenti-
cate Securities in the name of any predecessor Trustee shall apply
only to its successor or successors by merger, conversion or con-
solidation.
SECTION 611. Appointment of Authenticating Agent.
At any time when any of the Securities remain Outstanding, the
Trustee may appoint an Authenticating Agent or Agents with respect
to one or more series of Securities which shall be authorized to
act on behalf of the Trustee to authenticate Securities of such
series and the Trustee shall give written notice of such appoint-
ment to all Holders of Securities of the series with respect to
which such Authenticating Agent will serve, in the manner provided
for in Section 106. Securities so authenticated shall be entitled
to the benefits of this Indenture and shall be valid and obligatory
for all purposes as if authenticated by the Trustee hereunder. Any
such appointment shall be evidenced by an instrument in writing
signed by a Responsible Officer of the Trustee, and a copy of such
instrument shall be promptly furnished to the Company. Wherever
reference is made in this Indenture to the authentication and
delivery of Securities by the Trustee or the Trustee's certificate
of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authen-
ticating Agent and a certificate of authentication executed on
behalf of the Trustee by an Authenticating Agent. Each Authenti-
cating Agent shall be acceptable to the Company and shall at all
times be a corporation organized and doing business under the laws
of the United States of America, any state thereof or the District
of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than
$50,000,000 and subject to supervision or examination by federal or
state authority. If such corporation publishes reports of condi-
tion at least annually, pursuant to law or to the requirements of
said supervising or examining authority, then for the purposes of
this Section, the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any
time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect specified in this
Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation
to which such Authenticating Agent shall be a party, or any cor-
poration succeeding to the corporate agency or corporate trust
business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise
eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authen-
ticating Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may
at any time terminate the agency of an Authenticating Agent by
giving written notice thereof to such Authenticating Agent and to
the Company. Upon receiving such a notice of resignation or upon
such a termination, or in case at any time such Authenticating
Agent shall cease to be eligible in accordance with the provisions
of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give
written notice of such appointment to all Holders of Securities of
the series with respect to which such Authenticating Agent will
serve, in the manner provided for in Section 106. Any successor
Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as
an Authenticating Agent. No successor Authenticating Agent shall
be appointed unless eligible under the provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section,
and the Trustee shall be entitled to be reimbursed for such pay-
ments, subject to the provisions of Section 606.
If an appointment with respect to one or more series is made pursu-
ant to this Section, the Securities of such series may have
endorsed thereon, in addition to the Trustee's certificate of
authentication, an alternate certificate of authentication in the
following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
The Chase Manhattan Bank (National Association),
________________________________________________
as Trustee
By:_____________________________________________
as Authenticating Agent
By:_____________________________________________
Authorized Officer
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Disclosure of Names and Addresses of Holders.
Every Holder of Securities or coupons, by receiving and holding the
same, agrees with the Company and the Trustee that none of the Com-
pany or the Trustee or any agent of either of them shall be held
accountable by reason of the disclosure of any such information as
to the names and addresses of the Holders in accordance with TIA
Section 312, regardless of the source from which such information
was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under TIA
Section 312(b).
SECTION 702. Reports by Trustee.
Within 60 days after May 15 of each year commencing with the first
May 15 after the first issuance of Securities pursuant to this
Indenture, the Trustee shall transmit to the Holders of Securities,
in the manner and to the extent provided in TIA Section 313(c), a
brief report dated as of such May 15 if required by TIA Section
313(a).
SECTION 703. Reports by Company.
The Company shall:
(1) file with the Trustee, within 15 days after the Company
is required to file the same with the Commission, copies
of the annual reports and of the information, documents
and other reports (or copies of such portions of any of
the foregoing as the Commission may from time to time by
rules and regulations prescribe) which the Company may be
required to file with the Commission pursuant to Section
13 or Section 15(d) of the Securities Exchange Act of
1934; or, if the Company is not required to file informa-
tion, documents or reports pursuant to either of such
Sections, then it shall file with the Trustee and the
Commission, in accordance with rules and regulations
prescribed from time to time by the Commission, such of
the supplementary and periodic information, documents and
reports which may be required pursuant to Section 13 of
the Securities Exchange Act of 1934 in respect of a
security listed and registered on a national securities
exchange as may be prescribed from time to time in such
rules and regulations;
(2) file with the Trustee and the Commission, in accordance
with rules and regulations prescribed from time to time by
the Commission, such additional information, documents and
reports with respect to compliance by the Company with the
conditions and covenants of this Indenture as may be
required from time to time by such rules and regulations;
and
(3) transmit to all Holders, in the manner and to the extent
provided in TIA Section 313(c), within 30 days after the
filing thereof with the Trustee, such summaries of any
information, documents and reports required to be filed by
the Company pursuant to paragraphs (1) and (2) of this
Section as may be required by rules and regulations pre-
scribed from time to time by the Commission.
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other cor-
poration or convey, transfer or lease, or permit one or more of its
Subsidiaries to convey, transfer or lease, all or substantially all
of the property and assets of the Company and its Subsidiaries on
a consolidated basis, to any Person, unless:
(1) the corporation formed by such consolidation or into which
the Company is merged or the Person which acquires by con-
veyance or transfer, or which leases, the properties and
assets of the Company and its Subsidiaries on a consoli-
dated basis (A) shall be a corporation, partnership or
trust organized and validly existing under the laws of the
United States of America, any state thereof or the
District of Columbia and (B) shall expressly assume, by an
indenture supplemental hereto, executed and delivered to
the Trustee, in form satisfactory to the Trustee, the
Company's obligation for the due and punctual payment of
the principal of (and premium, if any, on) and interest on
all the Securities and the performance and observance of
every covenant of this Indenture on the part of the Com-
pany to be performed or observed;
(2) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be
continuing; and
(3) the Company or such Person shall have delivered to the
Trustee an Officers' Certificate and an Opinion of
Counsel, each stating that such consolidation, merger,
conveyance, transfer or lease and such supplemental inden-
ture comply with this Article and that all conditions
precedent herein provided for relating to such transaction
have been complied with.
This Section shall only apply to a merger or consolidation in which
the Company is not the surviving corporation and to conveyances,
leases and transfers by the Company as transferor or lessor.
SECTION 802. Successor Person Substituted.
Upon any consolidation by the Company with or merger by the Company
into any other corporation or any conveyance, transfer or lease of
the properties and assets of the Company and its Subsidiaries on a
consolidated basis to any Person in accordance with Section 801,
the successor Person formed by such consolidation or into which the
Company is merged or to which such conveyance, transfer or lease is
made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under this Indenture with the
same effect as if such successor Person had been named as the Com-
pany herein, and in the event of any such conveyance or transfer,
the Company (which term shall for this purpose mean the Person
named as the "Company" in the first paragraph of this Indenture or
any successor Person which shall theretofore become such in the
manner described in Section 801), except in the case of a lease,
shall be discharged of all obligations and covenants under this
Indenture and the Securities and the coupons and may be dissolved
and liquidated.
SECTION 803. Assignment of Rights.
The Company will have the right at all times to assign any of its
respective rights or obligations under this Indenture to a direct
or indirect wholly-owned Subsidiary of the Company; provided, that
in the event of any such assignment, the Company will remain liable
for all of its respective obligations. Subject to the foregoing,
this Indenture will be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns. This
Indenture may not otherwise be assigned by the parties hereto.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by
or pursuant to a Board Resolution, and the Trustee, at any time and
from time to time, may enter into one or more indentures supplemen-
tal hereto, in form satisfactory to the Trustee, for any of the
following purposes:
(1) to evidence the succession of another Person to the Com-
pany and the assumption by any such successor of the
covenants of the Company contained herein and in the
Securities; or
(2) to add to the covenants of the Company for the benefit of
the Holders of all or any series of Securities and any
related coupons (and if such covenants are to be for the
benefit of less than all series of Securities, stating
that such covenants are being included solely for the
benefit of such series) or to surrender any right or power
herein conferred upon the Company; or
(3) to add any additional Events of Default (and if such
Events of Default are to be for the benefit of less than
all series of Securities, stating that such Events of
Default are being included solely for the benefit of such
series); or
(4) to add to or change any of the provisions of this Inden-
ture to provide that Bearer Securities may be registrable
as to principal, to change or eliminate any restrictions
on the payment of principal of or any premium or interest
on Bearer Securities, to permit Bearer Securities to be
issued in exchange for Registered Securities, to permit
Bearer Securities to be issued in exchange for Bearer
Securities of other authorized denominations or to permit
or facilitate the issuance of Securities in uncertifi-
cated form; provided that any such action shall not
________
adversely affect the interests of the Holders of Securi-
ties of any series or any related coupons in any material
respect; or
(5) to change or eliminate any of the provisions of this
Indenture; provided that any such change or elimination
________
shall become effective only when there is no Security
Outstanding of any series created prior to the execution
of such supplemental indenture which is entitled to the
benefit of such provision; or
(6) to secure the Securities pursuant to the requirements of
Section 803 or 1009 or otherwise; or
(7) to establish the form or terms of Securities of any series
as permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the
Securities of one or more series and to add to or change
any of the provisions of this Indenture as shall be neces-
sary to provide for or facilitate the administration of
the trusts hereunder by more than one Trustee, pursuant to
the requirements of Section 609(b);
or
(9) to close this Indenture with respect to the authentication
and delivery of additional series of Securities, to cure
any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision
herein, or to make any other provisions with respect to
matters or questions arising under this Indenture;
provided such action shall not adversely affect the
________
interests of the Holders of Securities of any series and
any related coupons in any material respect.
SECTION 902. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority in
principal amount of all Outstanding Securities of any series, by
Act of said Holders delivered to the Company and the Trustee, the
Company, when authorized by or pursuant to a Board Resolution, and
the Trustee may enter into an indenture or indentures supplemental
hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture
which affect such series of Securities or of modifying in any
manner the rights of the Holders of Securities of such series under
this Indenture; provided, however, that no such supplemental
_________________
indenture shall, without the consent of the Holder of each
Outstanding Security of such series,
(1) change the Stated Maturity of the principal of, or any
installment of interest on, any Security of such series,
or reduce the principal amount thereof or the rate of
interest thereon or any premium payable upon the redemp-
tion thereof, or change any obligation of the Company to
pay Additional Amounts contemplated by Section 1005
(except as contemplated by Section 801(1) and permitted by
Section 901(1)), or reduce the amount of the principal of
an Original Issue Discount Security of such series that
would be due and payable upon a declaration of accelera-
tion of the Maturity thereof pursuant to Section 502 or
the amount thereof provable in bankruptcy pursuant to
Section 504, or adversely affect any right of repayment at
the option of any Holder of any Security of such series,
or change any Place of Payment where, or the Currency in
which, any Security of such series or any premium or
interest thereon is payable, or impair the right to
institute suit for the enforcement of any such payment on
or after the Stated Maturity thereof (or, in the case of
redemption or repayment at the option of the Holder, on or
after the Redemption Date or Repayment Date, as the case
may be), or
(2) reduce the percentage in principal amount of the Out-
standing Securities of such series required for any such
supplemental indenture, for any waiver of compliance with
certain provisions of this Indenture which affect such
series or certain defaults applicable to such series
hereunder and their consequences provided for in this
Indenture, or reduce the requirements of Section 1504 for
quorum or voting with respect to Securities of such
series, or
(3) modify any of the provisions of this Section, Section 513
or Section 1011, except to increase any such percentage or
to provide that certain other provisions of this Indenture
which affect such series cannot be modified or waived
without the consent of the Holder of each Outstanding
Security of such series.
Any such supplemental indenture adding any provisions to or
changing in any manner or eliminating any of the provisions of this
Indenture, or modifying in any manner the rights of the Holders of
Securities of such series, shall not affect the rights under this
Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders under this Section
to approve the particular form of any proposed supplemental inden-
ture, but it shall be sufficient if such Act shall approve the sub-
stance thereof.
SECTION 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifica-
tions thereby of the trusts created by this Indenture, the Trustee
shall be entitled to receive, and shall be fully protected in
relying upon, an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this
Indenture. The Trustee may, but shall not be obligated to, enter
into any such supplemental indenture which affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise.
SECTION 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this
Article, this Indenture shall be modified in accordance therewith,
and such supplemental indenture shall form a part of this Indenture
for all purposes; and every Holder of Securities theretofore or
thereafter authenticated and delivered hereunder shall be bound
thereby.
SECTION 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article
shall conform to the requirements of the Trust Indenture Act as
then in effect.
SECTION 906. Reference in Securities to Supplemental Indentures.
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article
may, and shall if required by the Trustee, bear a notation in form
approved by the Trustee as to any matter provided for in such sup-
plemental indenture. If the Company shall so determine, new
Securities of any series so modified as to conform, in the opinion
of the Trustee and the Company, to any such supplemental indenture
may be prepared and executed by the Company and authenticated and
delivered by the Trustee in exchange for Outstanding Securities of
such series.
SECTION 907. Notice of Supplemental Indentures.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of Section 902,
the Company shall give notice thereof to the Holders of each Out-
standing Security affected, in the manner provided for in Section
106, setting forth in general terms the substance of such supple-
mental indenture.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium, if any, and Interest.
The Company covenants and agrees for the benefit of the Holders of
each series of Securities and any related coupons that it will duly
and punctually pay the principal of (and premium, if any, on) and
interest on the Securities of that series in accordance with the
terms of the Securities, any coupons appertaining thereto and this
Indenture, subject, however, to the limitations set forth in this
Section 1001. Unless otherwise specified as contemplated by Sec-
tion 301 with respect to any series of Securities, any interest
installments due on Bearer Securities on or before Maturity shall
be payable only upon presentation and surrender of the several
coupons for such interest installments as are evidenced thereby as
they severally mature.
SECTION 1002. Maintenance of Office or Agency.
If the Securities of a series are issuable only as Registered
Securities, the Company will maintain in each Place of Payment for
any series of Securities an office or agency where Securities of
that series may be presented or surrendered for payment, where
Securities of that series may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the
Company in respect of the Securities of that series and this Inden-
ture may be served.
If Securities of a series are issuable as Bearer Securities, the
Company will maintain (A) in The City of New York, an office or
agency where any Registered Securities of that series may be pre-
sented or surrendered for payment, where any Registered Securities
of that series may be surrendered for registration of transfer,
where Securities of that series may be surrendered for exchange,
where notices and demands to or upon the Company in respect of the
Securities of that series and this Indenture may be served and
where Bearer Securities of that series and related coupons may be
presented or surrendered for payment in the circumstances described
in the following paragraph (and not otherwise), (B) subject to any
laws or regulations applicable thereto, in a Place of Payment for
that series which is located outside the United States, an office
or agency where Securities of that series and related coupons may
be presented and surrendered for payment; provided, however, that,
_________________
if the Securities of that series are listed on any stock exchange
located outside the United States and such stock exchange shall so
require, the Company will maintain a Paying Agent for the Securi-
ties of that series in any required city located outside the United
States so long as the Securities of that series are listed on such
exchange, and (C) subject to any laws or regulations applicable
thereto, in a Place of Payment for that series which is located
outside the United States, an office or agency where any Registered
Securities of that series may be surrendered for registration of
transfer, where Securities of that series may be surrendered for
exchange and where notices and demands to or upon the Company in
respect of the Securities of that series and this Indenture may be
served.
The Company will give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency.
If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the
address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the
Trustee, except that Bearer Securities of any series and the
related coupons may be presented and surrendered for payment at the
offices specified in the Security, in London, and the Company
hereby appoints the same as its agents to receive such respective
presentations, surrenders, notices and demands.
Unless otherwise specified with respect to any Securities pursuant
to Section 301, no payment of principal, premium or interest on
Bearer Securities shall be made at any office or agency of the Com-
pany in the United States or by check mailed to any address in the
United States or by transfer to an account maintained with a bank
located in the United States; provided, however, that, if the
_________________
Securities of a series are payable in Dollars, payment of principal
of (and premium, if any, on) and interest on any Bearer Security
shall be made at the office of the Company's Paying Agent in The
City of New York, if (but only if) payment in Dollars of the full
amount of such principal, premium or interest, as the case may be,
at all offices or agencies outside the United States maintained for
the purpose by the Company in accordance with this Indenture is
illegal or effectively precluded by exchange controls or other
similar restrictions.
The Company may also from time to time designate one or more other
offices or agencies where the Securities of one or more series may
be presented or surrendered for any or all such purposes and may
from time to time rescind any such designation; provided, however,
_________________
that no such designation or rescission shall in any manner relieve
the Company of its obligation to maintain an office or agency in
accordance with the requirements set forth above for Securities of
any series for such purposes. The Company will give prompt written
notice to the Trustee of any such designation or rescission and of
any change in the location of any such other office or agency.
Unless otherwise specified with respect to any Securities as con-
templated by Section 301 with respect to a series of Securities,
the Company hereby designates as a Place of Payment for each series
of Securities the office or agency of the Company in The City of
New York, and initially appoints the Trustee at its Corporate Trust
Office as Paying Agent in such city and as its agent to receive all
such presentations, surrenders, notices and demands.
Unless otherwise specified with respect to any Securities pursuant
to Section 301, if and so long as the Securities of any series (i)
are denominated in a Currency other than Dollars or (ii) may be
payable in a Currency other than Dollars, or so long as it is
required under any other provision of the Indenture, then the Com-
pany will maintain with respect to each such series of Securities,
or as so required, at least one Exchange Rate Agent.
SECTION 1003. Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with
respect to any series of Securities and any related coupons, it
will, on or before each due date of the principal of (and premium,
if any, on) or interest on any of the Securities of that series,
segregate and hold in trust for the benefit of the Persons entitled
thereto a sum in the Currency in which the Securities of such
series are payable (except as otherwise specified pursuant to Sec-
tion 301 for the Securities of such series and except, if applica-
ble, as provided in Sections 312(b), 312(d) and 312(e)) sufficient
to pay the principal (and premium, if any) or interest so becoming
due until such sums shall be paid to such Persons or otherwise dis-
posed of as herein provided and will promptly notify the Trustee of
its action or failure so to act.
Whenever the Company shall have one or more Paying Agents for any
series of Securities and any related coupons, it will, prior to or
on each due date of the principal of (and premium, if any, on) or
interest on any Securities of that series, deposit with a Paying
Agent a sum (in the Currency described in the preceding paragraph)
sufficient to pay the principal (and premium, if any) or interest
so becoming due, such sum to be held in trust for the benefit of
the Persons entitled to such principal, premium or interest, and
(unless such Paying Agent is the Trustee) the Company will promptly
notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent (other than the Trustee)
for any series of Securities to execute and deliver to the Trustee
an instrument in which such Paying Agent shall agree with the
Trustee, subject to the provisions of this Section, that such
Paying
Agent will:
(1) hold all sums held by it for the payment of the principal
of (and premium, if any, on) and interest on Securities
of such series in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such
Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company
(or any other obligor upon the Securities of such series)
in the making of any payment of principal of (or premium,
if any, on) or interest on the Securities of such series;
and
(3) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to
the Trustee all sums so held in trust by such Paying
Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other
purpose, pay, or by Company Order direct any Paying Agent to pay,
to the Trustee all sums held in trust by the Company or such Paying
Agent, such sums to be held by the Trustee upon the same trusts as
those upon which sums were held by the Company or such Paying
Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with
respect to such sums.
Except as provided in the Securities of any series, any money
deposited with the Trustee or any Paying Agent, or then held by the
Company, in trust for the payment of the principal of (and premium,
if any, on) or interest on any Security of any series, or any
coupon appertaining thereto, and remaining unclaimed for two years
after such principal (and premium, if any) or interest has become
due and payable shall be paid to the Company on Company Request, or
(if then held by the Company) shall be discharged from such trust;
and the Holder of such Security or coupon shall thereafter, as an
unsecured general creditor, look only to the Company for payment
thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease; provided, however, that the
_________________
Trustee or such Paying Agent, before being required to make any
such repayment, may at the expense of the Company cause to be pub-
lished once, in an Authorized Newspaper, notice that such money
remains unclaimed and that, after a date specified therein, which
shall not be less than 30 days from the date of such publication,
any unclaimed balance of such money then remaining will be repaid
to the Company.
SECTION 1004. Statement as to Compliance.
The Company will deliver to the Trustee, within 120 days after the
end of each fiscal year, a brief certificate from the principal
executive officer, principal financial officer or principal
accounting officer as to his or her knowledge of the Company's com-
pliance with all conditions and covenants under this Indenture.
For purposes of this Section 1004, such compliance shall be deter-
mined without regard to any period of grace or requirement of
notice under this Indenture.
SECTION 1005. Additional Amounts.
If any Securities of a series provide for the payment of additional
amounts to any Holder who is not a United States person in respect
of any tax, assessment or governmental charge ("Additional
Amounts"), the Company will pay to the Holder of any Security of
such series or any coupon appertaining thereto such Additional
Amounts as may be specified as contemplated by Section 301. When-
ever in this Indenture there is mentioned, in any context, the
payment of the principal (or premium, if any, on) or interest on,
or in respect of, any Security of a series or payment of any
related coupon or the net proceeds received on the sale or exchange
of any Security of a series, such mention shall be deemed to
include mention of the payment of Additional Amounts provided for
by the terms of such series established pursuant to Section 301 to
the extent that, in such context, Additional Amounts are, were or
would be payable in respect thereof pursuant to such terms and
express mention of the payment of Additional Amounts (if applica-
ble) in any provisions hereof shall not be construed as excluding
Additional Amounts in those provisions hereof where such express
mention is not made.
Except as otherwise specified as contemplated by Section 301, if
the Securities of a series provide for the payment of Additional
Amounts, at least 10 days prior to the first Interest Payment Date
with respect to that series of Securities (or if the Securities of
that series will not bear interest prior to Maturity, the first day
on which a payment or principal (and premium, if any) is made), and
at least 10 days prior to each date of payment of principal (and
premium, if any) or interest if there has been any change with
respect to the matters set forth in the below-mentioned Officers'
Certificate, the Company will furnish the Trustee and the Company's
principal Paying Agent or Paying Agents, if other than the Trustee,
with an Officers' Certificate instructing the Trustee and such
Paying Agent or Paying Agents whether such payment of principal of
(and premium, if any, on) or interest on the Securities of that
series shall be made to Holders of Securities of that series or any
related coupons who are not United States persons without with-
holding for or on account of any tax, assessment or other govern-
mental charge described in the Securities of the series. If any
such withholding shall be required, then such Officers' Certificate
shall specify by country the amount, if any, required to be with-
held on such payments to such Holders of Securities of that series
or related coupons and the Company will pay to the Trustee or such
Paying Agent the Additional Amounts required by the terms of such
Securities. In the event that the Trustee or any Paying Agent, as
the case may be, shall not so receive the above-mentioned certifi-
cate, then the Trustee or such Paying Agent shall be entitled to
(i) assume that no such withholding or deduction is required with
respect to any payment of principal (and premium, if any) or
interest with respect to any Securities of a series or related
coupons until it shall have received a certificate advising other-
wise and (ii) to make all payments of principal (and premium, if
any) and interest with respect to the Securities of a series or
related coupons without withholding or deductions until otherwise
advised. The Company covenants to indemnify the Trustee and any
Paying Agent for, and to hold them harmless against, any loss,
liability or expense reasonably incurred without negligence or bad
faith on their part arising out of or in connection with actions
taken or omitted by any of them in reliance on any Officers'
Certificate furnished pursuant to this Section.
SECTION 1006. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or dis-
charged, before the same shall become delinquent, (1) all material
taxes, assessments and governmental charges levied or imposed upon
the Company or any Subsidiary or upon the income, profits or
property of the Company or any Subsidiary, and (2) all material
lawful claims for labor, materials and supplies which, if unpaid,
might by law become a Lien upon any property or assets of the
Company or any Subsidiary that comprise more than 20% of Consoli-
dated Net Tangible Assets; provided, however, that the Company
_________________
shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by
appropriate proceedings.
SECTION 1007. Maintenance of Properties.
The Company will cause all property necessary for the operation of
the business of the Company and its Subsidiaries as a whole to be
maintained and kept in good condition, repair and working order and
supplied with all necessary equipment and will cause to be made all
necessary repairs, renewals, replacements, betterments and improve-
ments thereof, all as in the judgment of the Company may be neces-
sary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided,
________
however, that nothing in this Section shall prevent or restrict the
_______
sale, abandonment or other disposition of any of such property if
such action is, in the judgment of the Company, desirable in the
conduct of the business of the Company and its Subsidiaries as a
whole and not disadvantageous in any material respect to the
Holders.
SECTION 1008. Corporate Existence.
Subject to Article Eight, the Company will do or cause to be done
all things necessary to preserve and keep in full force and effect
its corporate existence and the rights (charter and statutory) and
franchises of the Company and any Subsidiary; provided, however,
_________________
that the Company shall not be required to preserve any such right
or franchise if the Company shall determine that the preservation
thereof is no longer desirable in the conduct of the business of
the Company and its Subsidiaries as a whole.
SECTION 1009. Limitation on Liens.
The Company will not, and will not permit any Subsidiary to,
directly or indirectly, create, incur, issue or assume any Debt
secured by any Lien on any property or assets owned by the Company
or any Subsidiary, and the Company will not, and will not permit
any Subsidiary to, create, incur, issue or assume any Debt secured
by any Lien on any shares of stock or Debt of any Subsidiary (such
shares of stock or Debt of any Subsidiary being called "Restricted
Securities"), unless (i) in the case of Debt which is expressly by
its terms subordinate or junior in right of payment to the applica-
ble series of Securities, such Securities (together with, if the
Company shall so determine, any other Debt of the Company or such
Subsidiary then existing or thereafter created which is not sub-
ordinate to the Securities) are secured by a Lien on such property
or assets that is senior to such other Lien with the same relative
priority as such subordinated Debt has with respect to the applica-
ble series of Securities or (ii) in the case of Liens securing Debt
which is pari passu with the applicable series of Securities, such
__________
Securities are secured by a Lien on such property or assets that is
equal and ratable with (or prior to) such other Lien, except that
any Lien securing such applicable series of Securities may be
junior to any Lien on the Company's accounts receivable, inventory
and related contract rights securing Debt under the Company's Bank
Credit Facility; provided, however, that nothing contained in this
_________________
Section shall prevent, restrict or apply to, and there shall be
excluded from secured Debt in any computation under this Section,
Debt secured by:
(a) Liens on any property or assets or Restricted Securities
of the Company or any Subsidiary existing as of the date
of the first issuance by the Company of the applicable
Securities issued pursuant to this Indenture or such other
date as may be specified in a Prospectus Supplement for an
applicable series of Securities issued pursuant to the
Indenture, subject to the provisions of subsection (h)
below;
(b) Liens on any property or assets or Restricted Securities
of any corporation existing at the time such corporation
becomes a Subsidiary, or arising thereafter (i) otherwise
than in connection with the borrowing of money arranged
thereafter and (ii) pursuant to contractual commitments
entered into prior to and not in contemplation of such
corporation's becoming a Subsidiary;
(c) Liens on any property or assets or Restricted Securities
of the Company or any Subsidiary existing at the time of
acquisition thereof (including acquisition through merger
or consolidation or by a sale, lease or other disposition
of the properties of a corporation as an entirety or sub-
stantially as an entirety to the Company or a Subsidiary)
or securing the payment of all or any part of the purchase
price or construction cost thereof or securing any Debt
incurred prior to, at the time of or within 120 days
after, the acquisition of such property or assets or
Restricted Securities or the completion of any such con-
struction, whichever is later, for the purpose of
financing all or any part of the purchase price or con-
struction cost thereof (provided such Liens are limited to
________
such property or assets or Restricted Securities, to
improvements on such property and to any other property or
assets not then owned by the Company or any Subsidiary or
constituting Restricted Securities);
(d) Liens on any property or assets to secure all or any part
of the cost of development, operation, construction,
alteration, repair or improvement of all or any part of
such property or assets, or to secure debt incurred by the
Company or any Subsidiary prior to, at the time of or
within 120 days after, the completion of such development,
operation, construction, alteration, repair or improve-
ment, whichever is later, for the purpose of financing all
or any part of such cost provided such Liens are limited
________
to such property or assets, improvements thereon and any
other property or assets not then owned by the Company or
a Subsidiary;
(e) Liens in favor of the Trustee for the benefit of the
Holders and subsequent holders of the Securities securing
the Securities;
(f) Liens secured by property or assets of the Company or any
Subsidiary that comprise no more than 20% of Consolidated
Net Tangible Assets;
(g) Liens which secure Debt owing by a Subsidiary to the Com-
pany or to another Subsidiary;
(h) Liens securing the Senior Indebtedness or any part
thereof; and
(i) any extension, renewal, substitution or replacement (or
successive extensions, renewals, substitutions or
replacements), as a whole or in part, of any of the Liens
referred to in paragraphs (a) through (g) above or the
Debt secured thereby; provided that (1) such extension,
________
renewal, substitution or replacement Lien shall be limited
to all or any part of the same property or assets or
Restricted Securities that secured the Lien extended,
renewed, substituted or replaced (plus improvements on
such property, and plus any other property or assets not
then owned by the Company or a Subsidiary or constituting
Restricted Securities) and (2) in the case of paragraphs
(a) through (c) above, the Debt secured by such Lien at
such time is not increased.
For the purposes of this Section 1009, the giving of a guarantee
which is secured by a Lien on any property or assets or Restricted
Securities, and the creation of a Lien on any property or assets or
Restricted Securities to secure Debt which existed prior to the
creation of such Lien, shall be deemed to involve the creation of
Debt in an amount equal to the principal amount guaranteed or
secured by such Lien; but the amount of Debt secured by Liens on
property or assets and Restricted Securities shall be computed
without cumulating the underlying indebtedness with any guarantee
thereof or Lien securing the same.
SECTION 1010. Limitation on Sale and Leaseback Transactions.
Except in respect of Securities issued to a Southern Union Trust or
a trustee of such trust, the Company will not, and will not permit
any Subsidiary to, enter into any arrangement after the date of the
original issuance by the Company of the applicable series of
Securities issued pursuant to the Indenture, or such other date as
may be specified in a Prospectus Supplement for an applicable
series of Securities issued pursuant to the Indenture, with any
Person (other than the Company or another Subsidiary) providing for
the leasing by the Company or any such Subsidiary of any property
(except a lease for a temporary period not to exceed three years by
the end of which it is intended that the use of such property by
the lessee will be discontinued) that was or is owned or leased by
the Company or a Subsidiary and that has been or is to be sold or
transferred by the Company or such Subsidiary to such Person
(herein referred to as a "sale and leaseback transaction") unless
either:
(a) after giving pro forma effect to such transaction, the
_________
Attributable Debt of the Company and its Subsidiaries in
respect of such sale and leaseback transaction and all
other sale and leaseback transactions entered into after
the date of the first issuance by the Company of Securi-
ties issued pursuant to this Indenture (other than such
sale and leaseback transactions as are permitted by para-
graph (b) below) would not exceed 20% of Consolidated Net
Tangible Assets, or
(b) the Company, within 180 days after the sale and leaseback
transaction, applies or causes a Subsidiary to apply an
amount equal to the greater of the net proceeds from the
sale of the property subject to the sale and leaseback
transaction or the fair market value of the property so
sold and leased back at the time of the sale and leaseback
transaction (in either case as determined by any two of
the following: the Chairman, the President, any Vice
President, the Treasurer and the Controller of the Com-
pany) to the retirement of Securities of any series or any
other Debt of the Company (other than Debt subordinated to
the Securities) or Debt of a Subsidiary having a stated
maturity more than 12 months from the date of such appli-
cation or which is extendible at the option of the obligor
thereon to a date more than 12 months from the date of
such application (and, unless otherwise expressly provided
with respect to any one or more series of Securities, any
redemption of Securities pursuant to this provision shall
not be deemed to constitute a refunding operation or
anticipated refunding operation for the purposes of any
provision limiting the Company's right to redeem Securi-
ties of any one or more such series when such redemption
involves a refunding operation or anticipated refunding
operation); provided that the amount to be so applied
________
shall be reduced by (i) the principal amount of Securities
delivered within 180 days after such sale or transfer to
the Trustee for retirement and cancellation and (ii) the
principal amount of any such Debt of the Company or a Sub-
sidiary, other than Securities, voluntarily retired by the
Company or a Subsidiary within 180 days after such sale or
transfer. Notwithstanding the foregoing, no retirement
referred to in this paragraph (b) may be effected by pay-
ment at maturity or pursuant to any mandatory sinking fund
payment or any mandatory prepayment provision.
Notwithstanding the foregoing, where the Company or any Subsidiary
is the lessee in any sale and leaseback transaction, Attributable
Debt shall not include any Debt resulting from the guarantee by the
Company or any other Subsidiary of the lessee's obligation there-
under.
SECTION 1011. Provision of Financial Information.
So long as any of the Securities are outstanding, the Company will
file, to the extent permitted under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), with the Commission the
annual reports, quarterly reports and other documents otherwise
required to be filed with the Commission pursuant to Section 13(a)
or 15(d) of the Exchange Act as if the Company were subject to such
Sections and will also provide to all Holders and file with the
Trustee copies of such reports and documents within 15 days after
it files them with the Commission or, if filing such reports and
documents by the Company with the Commission is not permitted under
the Exchange Act, within 15 days after it would otherwise have been
required to file such reports and documents if permitted, in each
case at the Company's cost.
SECTION 1012. Limitation on Dividends; Transactions with
Affiliates.
(a) If Securities are issued to a Southern Union Trust or a
trustee of such trust in connection with the issuance of
Trust Securities by such Southern Union Trust and (i)
there shall have occurred any event that would constitute
an Event of Default or (ii) the Company shall be in
default with respect of its payment or any other obliga-
tions under the Preferred Securities Guarantee or Common
Securities Guarantee relating to such Southern Union
Trust, then (A) the Company shall not and shall cause any
subsidiary of the Company that is not a wholly-owned
subsidiary of the Company not to, declare or pay any
dividend on, make any distributions with respect to, or
redeem, purchase, acquire or make a liquidation payment
with respect to, any of its capital stock or the capital
stock of any such subsidiary, and (B) the Company shall
not make any payment of interest, principal or premium, if
any, on or repay, repurchase or redeem any debt securities
issued by the Company which rank pari passu with or junior
to such Securities, provided that the foregoing restric-
tion in paragraph (A) does not apply to any stock
dividends paid by the Company or any of its subsidiaries
where the dividend stock is the same stock as that on
which the dividend is being paid.
(b) If Securities are issued to a Southern Union Trust or a
trustee of such a trust in connection with the issuance of
Trust Securities by such Southern Union Trust and the
Company shall have given notice of its election to defer
payments of interest on such Securities by extending the
interest payment period as provided in the Indenture and
such period, or any extension thereof, shall be
continuing, then (A) the Company shall not shall cause any
subsidiary of the Company that is not a wholly-owned
subsidiary of the Company not to, declare or pay any
dividend or, make any distributions with respect to, or
redeem, purchase, acquire or make a liquidation payment
with respect to, any of its capital stock or the capital
stock of any such subsidiary, and (B) the Company shall
not make any payment of interest, principal or premium, if
any, on or repay, repurchase or redeem any debt securities
issued by the Company which rank pari passu with or junior
to such Securities, provided that the foregoing
restriction in paragraph (A) does not apply to any stock
dividends paid by the Company or any of its subsidiaries
where the dividend stock is the same as that on which the
dividend is being paid.
SECTION 1013. Covenants as to Southern Union Trusts.
In the event Securities are issued and sold to a Southern Union
Trust or a trustee of such trust in connection with the issuance of
Trust Securities by such Southern Union Trust, for so long as such
Trust Securities remain outstanding, the Company will (i) maintain
100% direct or indirect ownership of the Common Securities of such
Southern Union Trust; provided, however, that any permitted succes-
_________________
sor of the Company under the Indenture may succeed to the Company's
ownership of the Common Securities, and (ii) use its reasonable
efforts to cause such Southern Union Trust (a) to remain a statu-
tory business trust, except in connection with a distribution of
Securities as provided in the Declaration of such Southern Union
Trust, the redemption of all of the Trust Securities and in connec-
tion with certain mergers, consolidations or amalgamation permitted
by the Declaration of such Southern Union Trust, and (b) otherwise
continue to be treated as a grantor trust for United States federal
income tax purposes.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Applicability of Article.
Securities of any series which are redeemable before their Stated
Maturity shall be redeemable in accordance with the terms of such
Securities and (except as otherwise specified as contemplated by
Section 301 for Securities of any series) in accordance with this
Article.
SECTION 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be
evidenced by or pursuant to a Board Resolution. In case of any
redemption at the election of the Company, the Company shall, at
least 60 days prior to the Redemption Date fixed by the Company
(unless a shorter notice shall be satisfactory to the Trustee),
notify the Trustee of such Redemption Date and of the principal
amount of Securities of such series to be redeemed and shall
deliver to the Trustee such documentation and records as shall
enable the Trustee to select the Securities to be redeemed pursuant
to Section 1103. In the case of any redemption of Securities prior
to the expiration of any restriction on such redemption provided in
the terms of such Securities or elsewhere in this Indenture, the
Company shall furnish the Trustee with an Officers' Certificate
evidencing compliance with such restriction.
SECTION 1103. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities of any series are to be redeemed,
the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the
Outstanding Securities of such series not previously called for
redemption, by such method as the Trustee shall deem fair and
appropriate and which may provide for the selection for redemption
of portions of the principal of Securities of such series;
provided, however, that no such partial redemption shall reduce the
_________________
portion of the principal amount of a Security not redeemed to less
than the minimum authorized denomination for Securities of such
series established pursuant to Section 301.
The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption and, in the case of any Securi-
ties selected for partial redemption, the principal amount thereof
to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Security redeemed or to be
redeemed only in part, to the portion of the principal amount of
such Security which has been or is to be redeemed.
SECTION 1104. Notice of Redemption.
Except as otherwise specified as contemplated by Section 301,
notice of redemption shall be given in the manner provided for in
Section 106 not less than 30 nor more than 60 days prior to the
Redemption Date, to each Holder of Securities to be redeemed.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities of any series
are to be redeemed, the identification (and, in the case
of partial redemption, the principal amounts) of the par-
ticular Securities to be redeemed,
(4) that on the Redemption Date the Redemption Price (together
with accrued interest, if any, to the Redemption Date pay-
able as provided in Section 1106) will become due and pay-
able upon each such Security, or the portion thereof, to
be redeemed and, if applicable, that interest thereon will
cease to accrue on and after said date,
(5) the place or places where such Securities, together in the
case of Bearer Securities with all coupons appertaining
thereto, if any, maturing after the Redemption Date, are
to be surrendered for payment of the Redemption Price,
(6) that the redemption is for a sinking fund, if such is the
case,
(7) that, unless otherwise specified in such notice, Bearer
Securities of any series, if any, surrendered for redemp-
tion must be accompanied by all coupons maturing subse-
quent to the Redemption Date or the amount of any such
missing coupon or coupons will be deducted from the
Redemption Price unless security or indemnity satisfactory
to the Company, the Trustee and any Paying Agent is fur-
nished, and
(8) if Bearer Securities of any series are to be redeemed and
any Registered Securities of such series are not to be
redeemed, and if such Bearer Securities may be exchanged
for Registered Securities not subject to redemption on
such Redemption Date pursuant to Section 305 or otherwise,
the last date, as determined by the Company, on which such
exchanges may be made.
Notice of redemption of Securities to be redeemed at the election
of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Com-
pany.
SECTION 1105. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its
own Paying Agent, segregate and hold in trust as provided in Sec-
tion 1003) an amount of money in the Currency in which the Securi-
ties of such series are payable (except as otherwise specified pur-
suant to Section 301 for the Securities of such series and except,
if applicable as provided in Sections 312(b), 312(d) and 312(e))
sufficient to pay the Redemption Price of, and accrued interest on,
all the Securities which are to be redeemed on that date.
SECTION 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities
so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified in the Currency
in which the Securities of such series are payable (except as
otherwise specified pursuant to Section 301 for the Securities of
such series and except, if applicable as provided in Sections
312(b), 312(d) and 312(e)) (together with accrued interest, if any,
to the Redemption Date), and from and after such date (unless the
Company shall default in the payment of the Redemption Price and
accrued interest) such Securities shall, if the same were interest-
bearing, cease to bear interest and the coupons for such interest
appertaining to any Bearer Securities so to be redeemed, except to
the extent provided below, shall be void. Upon surrender of any
such Security for redemption in accordance with said notice,
together with all coupons, if any, appertaining thereto maturing
after the Redemption Date, such Security shall be paid by the
Company at the Redemption Price, together with accrued interest, if
any, to the Redemption Date; provided, however, that installments
_________________
of interest on Bearer Securities whose Stated Maturity is on or
prior to the Redemption Date shall be payable only at an office or
agency located outside the United States (except as otherwise pro-
vided in Section 1002) and, unless otherwise specified as contem-
plated by Section 301, only upon presentation and surrender of
coupons for such interest, and provided, further, that installments
_________________
of interest on Registered Securities whose Stated Maturity is on or
prior to the Redemption Date shall be payable to the Holders of
such Securities, or one or more Predecessor Securities, registered
as such at the close of business on the relevant Record Dates
according to their terms and the provisions of Section 307.
If any Bearer Security surrendered for redemption shall not be
accompanied by all appurtenant coupons maturing after the Redemp-
tion Date, such Security may be paid after deducting from the
Redemption Price an amount equal to the face amount of all such
missing coupons, or the surrender of such missing coupon or coupons
may be waived by the Company and the Trustee if there be furnished
to them such security or indemnity as they may require to save each
of them and any Paying Agent harmless. If thereafter the Holder of
such Security shall surrender to the Trustee or any Paying Agent
any such missing coupon in respect of which a deduction shall have
been made from the Redemption Price, such Holder shall be entitled
to receive the amount so deducted; provided, however, that interest
_________________
represented by coupons shall be payable only at an office or agency
located outside the United States (except as otherwise provided in
Section 1002) and, unless otherwise specified as contemplated by
Section 301, only upon presentation and surrender of those coupons.
If any Security called for redemption or portion thereof shall not
be so paid upon surrender thereof for redemption, the principal
(and premium, if any) shall, until paid, bear interest from the
Redemption Date at the rate of interest or Yield to Maturity (in
the case of Original Issue Discount Securities) set forth in the
Security.
SECTION 1107. Securities Redeemed in Part.
Any Security which is to be redeemed only in part (pursuant to the
provisions of this Article or of Article Twelve) shall be sur-
rendered at a Place of Payment therefor (with, if the Company or
the Trustee so requires, due endorsement by, or a written instru-
ment of transfer in form satisfactory to the Company and the
Trustee duly executed by, the Holder thereof or such Holder's
attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and deliver to the
Holder of such Security without service charge, a new Security or
Securities of the same series, of any authorized denomination as
requested by such Holder, in aggregate principal amount equal to
and in exchange for the unredeemed portion of the principal of the
Security so surrendered.
ARTICLE TWELVE
SINKING FUNDS
SECTION 1201. Applicability of Article.
Retirements of Securities of any series pursuant to any sinking
fund shall be made in accordance with the terms of such Securities
and (except as otherwise specified as contemplated by Section 301
for Securities of any series) in accordance with this Article.
The minimum amount of any sinking fund payment provided for by the
terms of Securities of any series is herein referred to as a
"mandatory sinking fund payment", and any payment in excess of such
minimum amount provided for by the terms of Securities of any
series is herein referred to as an "optional sinking fund payment".
If provided for by the terms of Securities of any series, the cash
amount of any mandatory sinking fund payment may be subject to
reduction as provided in Section 1202. Each sinking fund payment
shall be applied to the redemption of Securities of any series as
provided for by the terms of Securities of such series.
SECTION 1202. Satisfaction of Sinking Fund Payments with
Securities.
Subject to Section 1203, in lieu of making all or any part of any
mandatory sinking fund payment with respect to any Securities of a
series in cash, subject to the limitations set forth at Section
1001, the Company may at its option (1) deliver to the Trustee-
Outstanding Securities of a series (other than any previously
called for redemption) theretofore purchased or otherwise acquired
by the Company together in the case of any Bearer Securities of
such series with all unmatured coupons appertaining thereto, and/or
(2) receive credit for the principal amount of Securities of such
series which have been previously delivered to the Trustee by the
Company or for Securities of such series which have been redeemed
either at the election of the Company pursuant to the terms of such
Securities or through the application of permitted optional sinking
fund payments pursuant to the terms of such Securities, in each
case in satisfaction of all or any part of any mandatory sinking
fund payment with respect to the Securities of the same series
required to be made pursuant to the terms of such Securities as
provided for by the terms of such series; provided, however, that
such Securities have not been previously so credited. Such Securi-
ties shall be received and credited for such purpose by the Trustee
at the Redemption Price specified in such Securities for redemption
through operation of the sinking fund and the amount of such manda-
tory sinking fund payment shall be reduced accordingly.
SECTION 1203. Redemption of Securities for Sinking Fund.
Not less than 60 days prior to each sinking fund payment date for
any series of Securities, the Company will deliver to the Trustee
an Officers' Certificate specifying the amount of the next ensuing
sinking fund payment for that series pursuant to the terms of that
series, the portion thereof, if any, which is to be satisfied by
payment of cash in the Currency in which the Securities of such
series are payable (except as otherwise specified pursuant to Sec-
tion 301 for the Securities of such series and except, if applica-
ble, as provided in Sections 312(b), 312(d) and 312(e)) and the
portion thereof, if any, which is to be satisfied by delivering or
crediting Securities of that series pursuant to Section 1202 (which
Securities will, if not previously delivered, accompany such cer-
tificate) and whether the Company intends to exercise its right to
make a permitted optional sinking fund payment with respect to such
series. Such certificate shall be irrevocable and upon its
delivery the Company shall be obligated to make the cash payment or
payments therein referred to, if any, on or before the next suc-
ceeding sinking fund payment date. In the case of the failure of
the Company to deliver such certificate, the sinking fund payment
due on the next succeeding sinking fund payment date for that
series shall be paid entirely in cash and shall be sufficient to
redeem the principal amount of such Securities subject to a
mandatory sinking fund payment without the option to deliver or
credit Securities as provided in Section 1202 and without the right
to make any optional sinking fund payment, if any, with respect to
such series.
Not more than 60 days before each such sinking fund payment date
the Trustee shall select the Securities to be redeemed upon such
sinking fund payment date in the manner specified in Section 1103
and cause notice of the redemption thereof to be given in the name
of and at the expense of the Company in the manner provided in Sec-
tion 1104. Such notice having been duly given, the redemption of
such Securities shall be made upon the terms and in the manner
stated in Sections 1106 and 1107.
Prior to any sinking fund payment date, the Company shall pay to
the Trustee or a Paying Agent (or, if the Company is acting as its
own Paying Agent, segregate and hold in trust as provided in Sec-
tion 1103) in cash a sum equal to any interest that will accrue to
the date fixed for redemption of Securities or portions thereof to
be redeemed on such sinking fund payment date pursuant to this
Section 1203.
Notwithstanding the foregoing, with respect to a sinking fund for
any series of Securities, if at any time the amount of cash to be
paid into such sinking fund on the next succeeding sinking fund
payment date, together with any unused balance of any preceding
sinking fund payment or payments for such series, does not exceed
in the aggregate $100,000, the Trustee, unless requested by the
Company, shall not give the next succeeding notice of the redemp-
tion of Securities of such series through the operation of the
sinking fund. Any such unused balance of moneys deposited in such
sinking fund shall be added to the sinking fund payment for such
series to be made in cash on the next succeeding sinking fund
payment date or, at the request of the Company, shall be applied at
any time or from time to time to the purchase of Securities of such
series, by public or private purchase, in the open market or other-
wise, at a purchase price for such Securities (excluding accrued
interest and brokerage commissions, for which the Trustee or any
Paying Agent will be reimbursed by the Company) not in excess of
the principal amount thereof.
ARTICLE THIRTEEN
REPAYMENT AT OPTION OF HOLDERS
SECTION 1301. Applicability of Article.
Repayment of Securities of any series before their Stated Maturity
at the option of Holders thereof shall be made in accordance with
the terms of such Securities and (except as otherwise specified as
contemplated by Section 301 for Securities of any series) in accor-
dance with this Article.
SECTION 1302. Repayment of Securities.
Securities of any series subject to repayment in whole or in part
at the option of the Holders thereof will, unless otherwise pro-
vided in the terms of such Securities, be repaid at a price equal
to the principal amount thereof, together with interest, if any,
thereon accrued to the Repayment Date specified in or pursuant to
the terms of such Securities. The Company covenants that on or
before the Repayment Date it will deposit with the Trustee or with
a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 1003) an
amount of money in the Currency in which the Securities of such
series are payable (except as otherwise specified pursuant to
Section 301 for the Securities of such series and except, if
applicable, as provided in Sections 312(b), 312(d) and 312(e))
sufficient to pay the principal (or, if so provided by the terms of
the Securities of any series, a percentage of the principal) of,
and (except if the Repayment Date shall be an Interest Payment
Date) accrued interest on, all the Securities or portions thereof,
as the case may be, to be repaid on such date.
SECTION 1303. Exercise of Option.
Securities of any series subject to repayment at the option of the
Holders thereof will contain an "Option to Elect Repayment" form on
the reverse of such Securities. To be repaid at the option of the
Holder, any Security so providing for such repayment, with the
"Option to Elect Repayment" form on the reverse of such Security
duly completed by the Holder (or by the Holder's attorney duly
authorized in writing), must be received by the Company at the
Place of Payment therefor specified in the terms of such Security
(or at such other place or places or which the Company shall from
time to time notify the Holders of such Securities) not earlier
than 45 days nor later than 30 days prior to the Repayment Date.
If less than the entire principal amount of such Security is to
be repaid in accordance with the terms of such Security, the
principal amount of such Security to be repaid, in increments of
the minimum denomination for Securities of such series, and the
denomination or denominations of the Security or Securities to be
issued to the Holder for the portion of the principal amount of
such Security surrendered that is not to be repaid, must be
specified. The principal amount of any Security providing for
repayment at the option of the Holder thereof may not be repaid in
part if, following such repayment, the unpaid principal amount of
such Security would be less than the minimum authorized
denomination of Securities of the series of which such Security to
be repaid is a part. Except as otherwise may be provided by the
terms of any Security providing for repayment at the option of the
Holder thereof, exercise of the repayment option by the Holder
shall be irrevocable unless waived by the Company.
SECTION 1304. When Securities Presented for Repayment Become Due
and Payable.
If Securities of any series providing for repayment at the option
of the Holders thereof shall have been surrendered as provided in
this Article and as provided by or pursuant to the terms of such
Securities, such Securities or the portions thereof, as the case
may be, to be repaid shall become due and payable and shall be paid
by the Company on the Repayment Date therein specified, and on and
after such Repayment Date (unless the Company shall default in the
payment of such Securities on such Repayment Date) such Securities
shall, if the same were interest-bearing, cease to bear interest
and the coupons for such interest appertaining to any Bearer
Securities so to be repaid, except to the extent provided below,
shall be void. Upon surrender of any such Security for repayment
in accordance with such provisions, together with all coupons, if
any, appertaining thereto maturing after the Repayment Date, the
principal amount of such Security so to be repaid shall be paid by
the Company, together with accrued interest, if any, to the Repay-
ment Date; provided, however, that coupons whose Stated Maturity is
_________________
on or prior to the Repayment Date shall be payable only at an
office or agency located outside the United States (except as
otherwise provided in Section 1002) and, unless otherwise specified
pursuant to Section 301, only further that, in the case of Regis-
_______
tered Securities, installments of interest, if any, whose Stated
Maturity is on or prior to the Repayment Date shall be payable to
the Holders of such Securities, or one or more Predecessor Securi-
ties, registered as such at the close of business on the relevant
Record Dates according to their terms and the provisions of Section
307.
If any Bearer Security surrendered for repayment shall not be
accompanied by all appurtenant coupons maturing after the Repayment
Date, such Security may be paid after deducting from the amount
payable therefor as provided in Section 1302 an amount equal to the
face amount of all such missing coupons, or the surrender of such
missing coupon or coupons may be waived by the Company and the
Trustee if there be furnished to them such security or indemnity as
they may require to save each of them and any Paying Agent harm-
less. If thereafter the Holder of such Security shall surrender to
the Trustee or any Paying Agent any such missing coupon in respect
of which a deduction shall have been made as provided in the pre-
ceding sentence, such Holder shall be entitled to receive the
amount so deducted; provided, however, that interest represented by
_________________
coupons shall be payable only at an office or agency located out-
side the United States (except as otherwise provided in Section
1002) and, unless otherwise specified as contemplated by Section
301, only upon presentation and surrender of those coupons.
If the principal amount of any Security surrendered for repayment
shall not be so repaid upon surrender thereof, such principal
amount (together with interest, if any, thereon accrued to such
Repayment Date) shall, until paid, bear interest from the Repayment
Date at the rate of interest Yield to Maturity (in the case of
Original Issue Discount Securities) set forth in such Security.
SECTION 1305. Securities Repaid in Part.
Upon surrender of any Registered Security which is to be repaid in
part only, the Company shall execute and the Trustee shall authen-
ticate and deliver to the Holder of such Security, without service
charge and at the expense of the Company, a new Registered Security
or Securities of the same series, of any authorized denomination
specified by the Holder, in an aggregate principal amount equal to
and in exchange for the portion of the principal of such Security
so surrendered which is not to be repaid.
ARTICLE FOURTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1401. Company's Option to Effect Defeasance or Covenant
Defeasance.
Except as otherwise specified as contemplated by Section 301 for
Securities of any series of this Section 1401, the provisions of
this Article Fourteen shall apply to each series of Securities, and
the Company may, at its option, effect (i) defeasance of the
Securities of or within a series under Section 1402, except that
the Company shall not effect any such defeasance under Section 1402
in respect of any Securities of which a Southern Union Trust or a
trustee of such Trust is the Holder, or (ii) covenant defeasance of
or within a series under Section 1403 in accordance with the terms
of such Securities and in accordance with this Article.
SECTION 1402. Defeasance and Discharge.
Upon the Company's exercise of the above option applicable to this
Section with respect to any Securities of or within a series, the
Company shall be deemed to have been discharged from its obliga-
tions with respect to such Outstanding Securities and any related
coupons on the date the conditions set forth in Section 1404 are
satisfied (hereinafter, "defeasance"). For this purpose, such
defeasance means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by such Outstanding
Securities and any related coupons, which shall thereafter be
deemed to be "Outstanding" only for the purposes of Section 1405
and the other Sections of this Indenture referred to in (A) and (B)
below, and to have satisfied all its other obligations under such
Securities and any related coupons and this Indenture insofar as
such Securities and any related coupons are concerned (and the
Trustee, at the expense of the Company, shall execute proper
instruments acknowledging the same), except for the following which
shall survive until otherwise terminated or discharged hereunder:
(A) the rights of Holders of such Outstanding Securities and any
related coupons to receive, solely from the trust fund described in
Section 1404 and as more fully set forth in such Section, payments
in respect of the principal of (and premium, if any, on) and
interest on such Securities and any related coupons when such
payments are due, (B) the Company's obligations with respect to
such Securities under Sections 304, 305, 306, 1002 and 1003 and
with respect to the payment of Additional Amounts, if any, on such
Securities as contemplated by Section 1005, (C) the rights, powers,
trusts, duties and immunities of the Trustee hereunder and (D) this
Article Fourteen. Subject to compliance with this Article
Fourteen, the Company may exercise its option under this Section
1402 notwithstanding the prior exercise of its option under Section
1403 with respect to such Securities and any related coupons.
SECTION 1403. Covenant Defeasance.
Upon the Company's exercise of the above option applicable to this
Section with respect to any Securities of or within a series, the
Company shall be released from its obligations under Section 803
and Sections 1006 through 1010, and, if specified pursuant to Sec-
tion 301, its obligations under any other covenant, with respect to
such Outstanding securities and any related coupons on and after
the date the conditions set forth in Section 1404 are satisfied
(hereinafter, "covenant defeasance"), and such Securities and any
related coupons shall thereafter be deemed not to be "Outstanding"
for the purposes of any direction, waiver, consent or declaration
or Act of Holders (and the consequences of any thereof) in connec-
tion with such covenants, but shall continue to be deemed "Out-
standing" for all other purposes hereunder. For this purpose, such
covenant defeasance means that, with respect to such Outstanding
Securities and any related coupons, the Company may omit to comply
with and shall have no liability in respect of any term, condition
or limitation set forth in any such covenant, whether directly or
indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of reference in any such covenant to any
other provision herein or in any other document and such omission
to comply shall not constitute a Default or an Event of Default
under Section 501(4) or Section 501(8) or otherwise, as the case
may be, but, except as specified above, the remainder of this
Indenture and such Securities and any related coupons shall be
unaffected thereby.
SECTION 1404. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of either Sec-
tion 1402 or Section 1403 to any Outstanding Securities of or
within a series and any related coupons:
(1) The Company shall irrevocably have deposited or caused to
be deposited with the Trustee (or another trustee satis-
fying the requirements of Section 607 who shall agree to
comply with the provisions of this Article Fourteen
applicable to it) as trust funds in trust for the purpose
of making the following payments, specifically pledged as
security for, and dedicated solely to, the benefit of the
Holders of such Securities and any related coupons, (A) an
amount (in such Currency in which such Securities and any
related coupons are then specified as payable at Stated
Maturity), or (B) Government Obligations applicable to
such Securities (determined on the basis of the Currency
in which such Securities are then specified as payable at
Stated Maturity) which through the scheduled payment of
principal and interest in respect thereof in accordance
with their terms will provide, not later than one day
before the due date of any payment of principal (including
any premium) and interest, if any, under such Securities
and any related coupons, money in an amount, or (C) a com-
bination thereof, sufficient, in the opinion of a
nationally recognized firm of independent public
accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge, and which
shall be applied by the Trustee (or other qualifying
trustee) to pay and discharge, (i) the principal of (and
premium, if any, on) and interest on such Outstanding
Securities and any related coupons on the Stated Maturity
(or Redemption Date, if applicable) of such principal (and
premium, if any) or installment or interest and (ii) any
mandatory sinking fund payments or analogous payments
applicable to such Outstanding Securities and any related
coupons on the day on which such payments are due and
payable in accordance with the terms of this Indenture and
of such Securities and any related coupons; provided that
________
the Trustee shall have been irrevocably instructed to
apply such money or the proceeds of such Government Obli-
gations to said payments with respect to such Securities
and any related coupons. Before such a deposit, the Com-
pany may give to the Trustee, in accordance with Section
1102 hereof, a notice of its election to redeem all or any
portion of such Outstanding Securities at a future date in
accordance with the terms of the Securities of such series
and Article Eleven hereof, which notice shall be irrevo-
cable. Such irrevocable redemption notice, if given,
shall be given effect in applying the foregoing.
(2) No Default or Event of Default with respect to such
Securities or any related coupons shall have occurred and
be continuing on the date of such deposit or, insofar as
paragraphs (5) and (7) of Section 501 are concerned, at
any time during the period ending on the 91st day after
the date of such deposit (it being understood that this
condition shall not be deemed satisfied until the expira-
tion of such period).
(3) Such defeasance or covenant defeasance shall not result in
a breach or violation of, or constitute a default under,
this Indenture or any other material agreement or instru-
instrument to which the Company is a party or by which it
is bound.
(4) In the case of an election under Section 1402, the Company
shall have delivered to the Trustee an Opinion of Counsel
stating that (x) the Company has received from, or there
has been published by, the Internal Revenue Service a
ruling, or (y) since the date of execution of this Inden-
ture, there has been a change in the applicable United
States federal income tax law, in either case to the
effect that, and based thereon such opinion shall confirm
that, the Holders of such Outstanding Securities and any
related coupons will not recognize income, gain or loss
for United States federal income tax purposes as a result
of such defeasance and will be subject to United States
federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such
defeasance had not occurred.
(5) In the case of an election under Section 1403, the Company
shall have delivered to the Trustee an Opinion of Counsel
to the effect that the Holders of such Outstanding Securi-
ties and any related coupons will not recognize income,
gain or loss for United States federal income tax purposes
as a result of such covenant defeasance and will be sub-
ject to United States federal income tax on the same
amounts, in the same manner and at the same times as would
have been the case if such covenant defeasance had not
occurred.
(6) Notwithstanding any other provisions of this Section, such
defeasance or covenant defeasance shall be effected in
compliance with any additional or substitute terms, condi-
tions or limitations in connection therewith pursuant to
Section 301.
(7) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent provided for
relating to either the defeasance under Section 1402 or
the covenant defeasance under Section 1403 (as the case
may be) have been complied with.
SECTION 1405. Deposited Money and Government Obligations to Be
Held in Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1003,
all money and Government Obligations (or other property as may be
provided pursuant to Section 301) (including the proceeds thereof)
deposited with the Trustee (or other qualifying trustee --
collectively for purposes of this Section 1405, the "Trustee")
pursuant to Section 1404 in respect of such Outstanding Securities
and any related coupons shall be held in trust and applied by the
Trustee, in accordance with the provisions of such Securities and
any related coupons and this Indenture, to the payment, either
directly or through any Paying Agent (including the Company acting
as its own Paying Agent) as the Trustee may determine, to the
Holders of such Securities and any related coupons of all sums due
and to become due thereon in respect of principal (and premium, if
any) and interest, but such money need not be segregated from other
funds except to the extent required by law.
Unless otherwise specified with respect to any Security pursuant to
Section 301, if, after a deposit referred to in Section 1404(1) has
been made, (a) the Holder of a Security in respect of which such
deposit was made is entitled to, and does, elect pursuant to Sec-
tion 312(b) or the terms of such Security to receive payment in a
Currency other than that in which the deposit pursuant to Section
1404(1) has been made in respect of such Security, or (b) a
Conversion Event occurs as contemplated in Section 312(d) or 312(e)
or by the terms of any Security in respect of which the deposit
pursuant to Section 1404(1) has been made, the indebtedness repre-
sented by such Security and any related coupons shall be deemed to
have been, and will be, fully discharged and satisfied through the
payment of the principal of (premium, if any, on), and interest, if
any, on such Security as they become due out of the proceeds
yielded by converting (from time to time as specified below in the
case of any such election) the amount or other property deposited
in respect of such Security into the Currency in which such
Security becomes payable as a result of such election or Conversion
Event based on the applicable Market Exchange Rate for such Cur-
rency in effect on the third Business Day prior to each payment
date, except, with respect to a Conversion Event, for such Currency
in effect (as nearly as feasible) at the time of the Conversion
Event.
The Company shall pay and indemnify the Trustee against any tax,
fee or other charge imposed on or assessed against the Government
Obligations deposited pursuant to Section 1404 or the principal and
interest received in respect thereof other than any such tax, fee
or other charge which by law is for the account of the Holders of
such Outstanding Securities and any related coupons.
Anything in this Article Fourteen to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time
upon Company Request any money or Government Obligations (or other
property and any proceeds therefrom) held by it as provided in Sec-
tion 1404 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification
thereof delivered to the Trustee, are in excess of the amount
thereof which would then be required to be deposited to effect an
equivalent defeasance or covenant defeasance, as applicable, in
accordance with this Article.
SECTION 1406. Reinstatement.
If the Trustee or any Paying Agent is unable to apply any money in
accordance with Section 1405 by reason of any order or judgment of
any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, then the Company's obliga-
tions under this Indenture and such Securities and any related
coupons shall be revived and reinstated as though no deposit had
occurred pursuant to Section 1402 or 1403, as the case may be,
until such time as the Trustee or Paying Agent is permitted to
apply all such money in accordance with Section 1405; provided,
________
however, that if the Company makes any payment of principal of (or
_______
premium, if any, on) or interest on any such Security or any
related coupon following the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of such
Securities and any related coupons to receive such payment from the
money held by the Trustee or Paying Agent.
ARTICLE FIFTEEN
MEETINGS OF HOLDERS OF SECURITIES
SECTION 1501. Purposes for Which Meetings May Be Called.
If Securities of a series are issuable as Bearer Securities, a
meeting of Holders of Securities of such series may be called at
any time and from time to time pursuant to this Article to make,
give or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be
made, given or taken by Holders of Securities of such series.
SECTION 1502. Call, Notice and Place of Meetings.
(a) The Trustee may at any time call a meeting of Holders of
Securities of any series for any purpose specified in Sec-
tion 1501, to be held at such time and at such place in
The City of New York or in London as the Trustee shall
determine. Notice of every meeting of Holders of Securi-
ties of any series, setting forth the time and the place
of such meeting and in general terms the action proposed
to be taken at such meeting, shall be given, in the manner
provided for in Section 106, not less than 21 nor more
than 180 days prior to the date fixed for the meeting.
(b) In case at any time the Company, pursuant to a Board
Resolution, or the Holders of at least 10% in principal
amount of the Outstanding Securities of any series shall
have requested the Trustee to call a meeting of the
Holders of Securities of such series for any purpose
specified in Section 1501, by written request setting
forth in reasonable detail the action proposed to be taken
at the meeting, and the Trustee shall not have made the
first publication of the notice of such meeting within 21
days after receipt of such request or shall not thereafter
proceed to cause the meeting to be held as provided
herein, then the Company or the Holders of Securities of
such series in the amount above specified, as the case may
be, may determine the time and the place in The City of
New York or in London for such meeting and may call such
meeting for such purposes by giving notice thereof as pro-
vided in paragraph (a) of this Section.
SECTION 1503. Persons Entitled to Vote at Meetings.
To be entitled to vote at any meeting of Holders of Securities of
any series, a Person shall be (1) a Holder of one or more Out-
standing Securities of such series, or (2) a Person appointed by an
instrument in writing as proxy for a Holder or Holders of one or
more Outstanding Securities of such series by such Holder or
Holders. The only Persons who shall be entitled to be present or
to speak at any meeting of Holders of Securities of any series
shall be the Person entitled to vote at such meeting and their
counsel, any representatives of the Trustee and its counsel and any
representatives of the Company and its counsel.
SECTION 1504. Quorum; Action.
The Persons entitled to vote a majority in principal amount of the
Outstanding Securities of a series shall constitute a quorum for a
meeting of Holders of Securities of such series; provided, however,
_________________
that, if any action is to be taken at such meeting with respect to
a consent or waiver which this Indenture expressly provides may be
given by the Holders of not less than a specified percentage in
principal amount of the Outstanding Securities of a series, the
Persons entitled to vote such specified percentage in principal
amount of the Outstanding Securities of such series shall consti-
tute a quorum. In the absence of a quorum within 30 minutes of the
time appointed for any such meeting, the meeting shall, if convened
at the request of Holders of Securities of such series, be dis-
solved. In any other case the meeting may be adjourned for a
period of not less than 10 days as determined by the chairman of
the meeting prior to the adjournment of such meeting. In the
absence of a quorum at any such adjourned meeting, such adjourned
meeting may be further adjourned for a period of not less than 10
days as determined by the chairman of the meeting prior to the
adjournment of such adjourned meeting. Notice of the reconvening
of any adjourned meeting shall be given as provided in Section
1502(a), except that such notice need be given only once not less
than five days prior to the date on which the meeting is scheduled
to be reconvened. Notice of the reconvening of any adjourned
meeting shall state expressly the percentage, as provided above, of
the principal amount of the Outstanding Securities of such series
which shall constitute a quorum.
Except as limited by the proviso to Section 902, any resolution
presented to a meeting or adjourned meeting duly reconvened at
which a quorum is present as aforesaid may be adopted by the affir-
mative vote of the Holders of not less than a majority in principal
amount of the Outstanding Securities of that series; provided,
________
however, that, except as limited by the proviso to Section 902, any
_______
resolution with respect to any request, demand, authorization,
direction, notice, consent, waiver or other action which this
Indenture expressly provides may be made, given or taken by the
Holders of a specified percentage, which is less than a majority,
in principal amount of the Outstanding Securities of a series may
be adopted at a meeting or an adjourned meeting duly reconvened and
at which a quorum is present as aforesaid by the affirmative vote
of the Holders of not less than such specified percentage in prin-
cipal amount of the Outstanding Securities of that series.
Any resolution passed or decision taken at any meeting of Holders
of Securities of any series duly held in accordance with this Sec-
tion shall be binding on all the Holders of Securities of such
series and the related coupons, whether or not present or repre-
sented at the meeting.
Notwithstanding the foregoing provisions of this Section 1504, if
any action is to be taken at a meeting of Holders of Securities of
any series with respect to any request, demand, authorization,
direction, notice, consent, waiver or other action that this
Indenture expressly provides may be made, given or taken by the
Holders of a specified percentage in principal amount of all Out-
standing Securities affected thereby, or of the Holders of such
series and one or more additional series:
(i) there shall be no minimum quorum requirement for such
meeting; and
(ii) the principal amount of the Outstanding Securities of
such series that vote in favor of such request, demand,
authorization, direction, notice, consent, waiver or
other action shall be taken into account in determining
whether such request, demand, authorization, direction,
notice, consent, waiver or other action has been made,
given or taken under this Indenture.
SECTION 1505. Determination of Voting Rights; Conduct and
Adjournment of Meetings.
(a) Notwithstanding any provisions of this Indenture, the
Trustee may make such reasonable regulations as it may
deem advisable for any meeting of Holders of Securities
of a series in regard to proof of the holding of Securi-
ties of such series and of the appointment of proxies and
in regard to the appointment and duties of inspectors of
votes, the submission and examination of proxies, cer-
tificates and other evidence of the right to vote, and
such other matters concerning the conduct of the meeting
as it shall deem appropriate. Except as otherwise per-
mitted or required by any such regulations, the holding
of Securities shall be proved in the manner specified in
Section 104 and the appointment of any proxy shall be
proved in the manner specified in Section 104 or by
having the signature of the person executing the proxy
witnessed or guaranteed by any trust company, bank or
banker authorized by Section 104 to certify to the
holding of Bearer Securities. Such regulations may pro-
vide that written instruments appointing proxies, regu-
lar on their face, may be presumed valid and genuine
without the proof specified in Section 104 or other
proof.
(b) The Trustee shall, by an instrument in writing appoint a
temporary chairman of the meeting, unless the meeting
shall have been called by the Company or by Holders of
Securities as provided in Section 1502(b), in which case
the Company or the Holders of Securities of the series
calling the meeting, as the case may be, shall in like
manner appoint a temporary chairman. A permanent chair-
man and a permanent secretary of the meeting shall be
elected by vote of the Persons entitled to vote a
majority in principal amount of the Outstanding Securi-
ties of such series represented at the meeting.
(c) At any meeting each Holder of a Security of such series
or proxy shall be entitled to one vote for each $25
principal amount of Outstanding Securities of such series
held or represented by him (determined as specified in
the definition of "Outstanding" in Section 101);
provided, however, that no vote shall be cast or counted
_________________
at any meeting in respect of any Security challenged as
not Outstanding and ruled by the chairman of the meeting
to be not Outstanding. The chairman of the meeting shall
have no right to vote, except as a Holder of a Security
of such series or proxy.
(d) Any meeting of Holders of Securities of any series duly
called pursuant to Section 1502 at which a quorum is
present may be adjourned from time to time by Persons
entitled to vote a majority in principal amount of the
Outstanding Securities of such series represented at the
meeting; and the meeting may be held as so adjourned
without further notice.
SECTION 1506. Counting Votes and Recording Action of Meetings.
The vote upon any resolution submitted to any meeting of Holders of
Securities of any series shall be by written ballots on which shall
be subscribed the signatures of the Holders of Securities of such
series or of their representatives by proxy and the principal
amounts and serial numbers of the Outstanding Securities of such
series held or represented by them. The permanent chairman of the
meeting shall appoint two inspectors of votes who shall count all
votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their veri-
fied written reports in duplicate of all votes cast at the meeting.
A record, at least in duplicate, of the proceedings of each meeting
of Holders of Securities of any series shall be prepared by the
secretary of the meeting and there shall be attached to said record
the original reports of the inspectors of votes on any vote by
ballot taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the
meeting and showing that said notice was given as provided in Sec-
tion 1502 and, if applicable, Section 1504. Each copy shall be
signed and verified by the affidavits of the permanent chairman and
secretary of the meeting and one such copy shall be delivered to
the Company, and another to the Trustee to be preserved by the
Trustee, the latter to have attached thereto the ballots voted at
the meeting. Any record so signed and verified shall be conclusive
evidence of the matters therein stated.
This Indenture may be executed in any number of counterparts, each
of which so executed shall be deemed to be an original, but all
such counterparts shall together constitute but one and the same
Indenture.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture
to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first
above written.
[Seal] SOUTHERN UNION COMPANY
Attest:
__________________________ By:_____________________________
Name:___________________________
Title:__________________________
[Seal] THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION)
Attest:
__________________________ By:_____________________________
Name:___________________________
Title:__________________________
<PAGE>
EXHIBIT 4-H
FORM OF SUPPLEMENTAL INDENTURE
to be used in connection with the issuance of
SUBORDINATED DEBT SECURITIES AND PREFERRED SECURITIES
<PAGE>
FIRST SUPPLEMENTAL INDENTURE, dated as of _________, 1995 (the
"First Supplemental Indenture"), between Southern Union Company,
a Delaware corporation (the "Company"), The Chase Manhattan Bank,
National Association, as trustee (the "Trustee") under the Inden-
ture dated as of ________, 1995 between the Company and the
Trustee (the "Indenture").
WHEREAS, the Company executed and delivered the Indenture to the
Trustee to provide for the future issuance of the Company's
unsecured subordinated debt securities to be issued from time to
time in one or more series as might be determined by the Company
under the Indenture, in an unlimited aggregate principal amount
which may be authenticated and delivered as provided in the
Indenture;
WHEREAS, pursuant to the terms of the Indenture, the Company
desires to provide for the establishment of a new series of its
Securities to be known as its ___% Subordinated Deferrable
Interest Notes due 2025 (the "Notes"), the form and substance of
such Notes and the terms, provisions and conditions thereof to be
set forth as provided in the Indenture and this First Supple-
mental Indenture;
WHEREAS, Southern Union Financing [ ], a Delaware statutory busi-
ness trust (the "Trust"), has offered to the public $[ ]
aggregate liquidation amount of its ___% Trust Originated Pre-
ferred Securities (the "Preferred Securities"), representing
undivided beneficial interests in the assets of the Trust and
proposes to invest the proceeds from such offering in $[ ]
aggregate principal amount of the Notes; and
WHEREAS, the Company has requested that the Trustee execute and
deliver this First Supplemental Indenture and all requirements
necessary to make this First Supplemental Indenture a valid
instrument in accordance with its terms and to make the Notes,
when executed by the Company and authenticated and delivered by
the Trustee, the valid obligations of the Company have been per-
formed, and the execution and delivery of this First Supplemental
Indenture has been duly authorized in all respects:
NOW THEREFORE, in consideration of the purchase and acceptance of
the Notes by the Holders thereof, and for the purpose of setting
forth, as provided in the Indenture, the form and substance of
the Notes and the terms, provisions and conditions thereof, the
Company covenants and agrees with the Trustee as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definition of Terms.
Unless the context otherwise requires:
(a) a term defined in the Indenture has the same meaning
when used in this First Supplemental Indenture;
(b) a term defined anywhere in this First Supplemental
Indenture has the same meaning throughout;
(c) the singular includes the plural and vice versa;
(d) a reference to a Section or Article is to a Section or
Article of this First Supplemental Indenture;
(e) headings are for convenience of reference only and do
not affect interpretation;
(f) the following terms have the meanings given to them in
the Declaration: (i) Business Day; (ii) Clearing
Agency; (iii) Delaware Trustee; (iv) Dissolution Tax
Opinion; (v) No Recognition Opinion; (vi) Property
Trustee; (vii) Preferred Security Certificate; (viii)
Regular Trustees; and (ix) Tax Event; and
(g) the following terms have the meanings given to them in
this Section 1.1(g):
"Declaration" means the Amended and Restated Declaration of Trust
of Southern Union Financing [ ], a Delaware statutory business
trust, dated as of ____________________ 1995.
"Dissolution Event" means that as a result of the occurrence and
continuation of a Tax Event, the Trust is to be dissolved in
accordance with the Declaration, and the Notes held by the
Property Trustee are to be distributed to the holders of the
Trust Securities issued by the Trust pro rata in accordance with
the Declaration.
"Extended Maturity Date" means, if the Company elects to extend
the Maturity Date in accordance with Section 2.2(b), the date
selected by the Company which is after the Scheduled Maturity
Date but before _________, 2044.
"Maturity Date" means the date on which the Notes mature and on
which the principal shall be due and payable together with all
accrued and unpaid interest thereon including Compounded Interest
and Additional Interest, if any.
"Scheduled Maturity Date" means ______________, 2025.
"Senior Indebtedness" means with respect to the Company, (i) the
principal, premium, if any, and interest in respect of (A)
indebtedness of such obligor for money borrowed and (B) indebted-
ness evidenced by securities, debentures, bonds or other similar
instruments issued by such obligor, including, without limita-
tion, all obligations under its 7.60% Senior Notes due 2024; (ii)
all capital lease obligations of such obligor; (iii) all obliga-
tions of such obligor issued or assumed as the deferred purchase
price of property, all conditional sale obligations of such obli-
gor and all obligations of such obligor under any title retention
agreement (but excluding trade accounts payable arising in the
ordinary course of business); (iv) all obligations of such
obligor for the reimbursement on any letter of credit, banker's
acceptance, security purchase facility or similar credit
transaction; (v) all obligations of the type referred to in
clauses (i) through (iv) of other persons for the payment of
which such obligor is responsible or liable as obligor, guarantor
or otherwise; and (vi) all obligations of the type referred to in
clauses (i) through (v) of other persons secured by any lien on
any property or asset of such obligor (whether or not such
obligation is assumed by such obligor), except for (1) any such
indebtedness that is by its terms subordinated to or pari passu
with the Notes, as the case may be, and (2) any indebtedness
between or among any obligor and its Affiliates, including all
other debt securities and guarantees in respect of those debt
securities, issued to (y) any other Southern Union Trust or (z)
any trusts, partnerships or any other entities affiliated with
the Company which is a financing vehicle of the Company ("Financing
Entity") in connection with an issuance of preferred securities
by such Financing Entity of preferred securities or other
securities which rank pari passu with or junior to the Preferred
Securities.
ARTICLE II
GENERAL TERMS AND CONDITIONS OF THE NOTES
SECTION 2.1. Designation and Principal Amount.
There is hereby authorized a series of Securities designated the
"_____% Subordinated Deferrable Interest Notes due 2025", limited
in aggregate principal amount to $[ million], which amount
shall be as set forth in any written Company Order for the
authentication and delivery of Notes pursuant to Section 2.4 of
the Indenture.
SECTION 2.2. Maturity.
(a) The Maturity Date will be either:
(i) the Scheduled Maturity Date; or
(ii) if the Company elects to extend the Maturity Date
beyond the Scheduled Maturity Date in accordance
with Section 2.2(b), the Extended Maturity Date;
(b) the Company may at any time before the day which is 90
days before the Scheduled Maturity Date, elect to
extend the Maturity Date only once to the Extended
Maturity Date, provided that the following conditions
________ ____
in this Section 2.2(b) are satisfied both at the date
the Company gives notice in accordance with Section
2.2(c) of its election to extend the Maturity Date and
at the Scheduled Maturity Date:
(i) the Company is not in bankruptcy or otherwise
insolvent;
(ii) the Company is not in default on any Securities
issued to any Southern Union Trust or any trustee
of such Southern Union Trust in connection with
the issuance of Trust Securities by such Southern
Union Trust;
(iii) the Company has made timely payments on the
Debenture for the immediately preceding 18 months
without deferrals;
(iv) the Trust is not in arrears on payments of Dis-
tributions on the Trust Securities issued by it;
and
(v) the Notes are rated Investment grade or the
equivalent by any one of Standard & Poor's
Corporation, Moody's Investors Service, Inc.,
Fitch Investor Services, Duff & Phelps Credit
Rating Company or any other nationally recognized
statistical rating organization; and
(c) if the Company elects to extend the Maturity Date in
accordance with Section 2.2(b), the Company shall give
notice to Holders of the Notes, the Property Trustee,
the Trust and the Trustee of the extension of the
Maturity Date and the Extended Maturity Date at least 90
days before the Scheduled Maturity Date.
SECTION 2.3. Form and Payment.
Except as provided in Section 2.4, the Notes shall be issued as
Registered Securities in fully registered certificated form with-
out interest coupons. Principal and interest on the Notes issued
in certificated form will be payable, the transfer of such Notes
will be registrable and such Notes will be exchangeable for Notes
bearing identical terms and provisions at the office or agency of
the Trustee; provided, however, that payment of interest may be
made at the option of the Company by check mailed to the Holder
at such address as shall appear in the Security Register. Not-
withwithstanding the foregoing, so long as the Holder of any
Notes is the Property Trustee, the payment of the principal of
and interest (including Compounded Interest and Additional Inter-
est, if any) on such Notes held by the Property Trustee will be
made at such place and to such account as may be designated by
the Property Trustee.
SECTION 2.4. Global Note.
(a) In connection with a Dissolution Event;
(i) the Notes in certificated form may be presented to
the Trustee by the Property Trustee in exchange
for a global Note in an aggregate principal amount
equal to all Outstanding Notes (a "Global Note"),
to be registered in the name of the Depository, or
its nominee, and delivered by the Trustee to the
Depository for crediting to the accounts of its
participants pursuant to the instructions of the
Regular Trustees. The Company upon any such
presentation shall execute a Global Note in
such aggregate principal amount and deliver the
same to the Trustee for authentication and deliv-
ery in accordance with the Indenture and this
First Supplemental Indenture. Payments on the
Notes issued as a Global Note will be made to the
Depository; and
(ii) if any Preferred Securities are held in non book-
entry certificated form, the Notes in certificated
form may be presented to the Trustee by the
Property Trustee and any Preferred Security Cer-
tificate which represents Preferred Securities
other than Preferred Securities held by the
Clearing Agency or its nominee ("Non Book-Entry
Preferred Securities") will be deemed to represent
beneficial interests in Notes presented to the
Trustee by the Property Trustee having an aggre-
gate principal amount equal to the aggregate
liquidation amount of the Non Book-Entry Preferred
Securities until such Preferred Security Certifi-
cates are presented to the Security Registrar for
transfer or reissuance at which time such Pre-
ferred Security Certificates will be cancelled and
a Note registered in the name of the holder of the
Preferred Security Certificate or the transferee
of the holder of such Preferred Security Certifi-
cate, as the case may be, with an aggregate prin-
cipal amount equal to the aggregate liquidation
amount of the Preferred Security Certificate
cancelled will be executed by the Company and
delivered to the Trustee for authentication and
delivery in accordance with the Indenture and this
First Supplemental Indenture. On issue of such
Notes, Notes with an equivalent aggregate princi-
pal amount that were presented by the Property
Trustee to the Trustee will be deemed to have been
cancelled.
(b) A Global Note may be transferred, in whole but not in
part only to another nominee of the Depositary, or to a
successor Depositary selected or approved by the Com-
pany or to a nominee of such successor Depositary.
(c) If at any time the Depositary notifies the Company that
it is unwilling or unable to continue as Depositary or
if at any time the Depositary for such series shall no
longer be registered or in good standing under the
Securities Exchange Act of 1934, as amended, or other
applicable statute or regulation, and a successor
Depositary for such series is not appointed by the
Company within 90 days after the Company receives such
notice or becomes aware of such condition, as the case
may be, the Company will execute, and, subject to
Article Two of the Indenture, the Trustee will
authenticate and deliver the Notes in definitive
registered form without coupons, in authorized denomi-
nations, and in an aggregate principal amount equal to
the principal amount of the Global Note in exchange for
such Global Note. In addition, the Company may at any
time determine that the Notes shall no longer be repre-
sented by a Global Note. In such event the Company
will execute and subject to Certificate evidencing such
determination by the Company, will authenticate and
deliver the Notes in definitive registered form without
coupons, in authorized denominations, and in an aggre-
gate principal amount equal to the principal amount of
the Global Note in exchange for such Global Note. Upon
the exchange of the Global Note for such Notes in
definitive registered form without coupons, in autho-
rized denominations, the Global Note shall be cancelled
by the Trustee. Such Notes in definitive registered
form issued in exchange for the Global Note shall be
registered in such names and in such authorized denomi-
nations as the Depositary, pursuant to instructions
from its direct or indirect participants or otherwise,
shall instruct the Trustee. The Trustee shall deliver
such Securities to the Depositary for delivery to the
Persons in whose names such Securities are so regis-
tered.
SECTION 2.5. Interest.
(a) Each Note will bear interest at the rate of ___% per
annum (the "Coupon Rate") from the original date of
issuance until the principal thereof becomes due and
payable, and on any overdue principal and (to the
extent that payment of such interest is enforceable
under applicable law) on any overdue installment of
interest at the Coupon Rate, compounded quarterly,
payable (subject to the provisions of Article Four)
quarterly in arrears on March 31, June 30, September 30
and December 31 of each year (each, an "Interest Pay-
ment Date", commencing on __________, 1995), to the
Person in whose name such Note or any predecessor Note
is registered, at the close of business on the regular
record date for such interest installment, which, in
respect of any Notes of which the Property Trustee is
the Holder of or a Global Note, shall be the close of
business on the Business Day next preceding that Inter-
est Payment Date. Notwithstanding the foregoing
sentence, if the Preferred Securities are no longer in
book-entry only form or if pursuant to the Indenture the
Notes are not represented by a Global Note, the Company
may select a regular record date for such interest
installment which shall be any date at least one Business
Day before an Interest Payment Date.
(b) The amount of interest payable for any period will be
computed on the basis of a 360-day year of twelve 30-
day months. Except as provided in the following
sentence, the amount of interest payable for any period
shorter than a full quarterly period for which interest
in computed, will be computed on the basis of the
actual number of days elapsed in such a 30-day month.
In the event that any date on which interest is payable
on the Notes is not a Business Day, then payment of
interest payable on such date will be made on the next
succeeding day which is a Business Day (and without any
interest or other payment in respect of any such
delay), except that, if such Business Day is in the
next succeeding calendar year, such payment shall be
made on the immediately preceding Business Day, in each
case with the same force and effect as if made on such
date.
(c) If at any time while the Property Trustee is the Holder
of any Notes, the Trust or the Property Trustee is
required to pay any taxes, duties assessments or
governmental charges of whatever nature (other than
withholding taxes) imposed by the United States, or any
other taxing authority, then, in any case, the Company
will pay as additional interest ("Additional Interest")
on the Notes held by the Property Trustee, such addi-
tional amounts as shall be required so that the net
amounts received and retained by the Trust and the
Property Trustee after paying such taxes, duties
assessments or other governmental charges will be equal
to the amounts the Trust and the Property Trustee would
have received had no such taxes, duties, assessments or
other government charges been imposed.
ARTICLE III
REDEMPTION OF THE NOTES
SECTION 3.1. Special Event Redemption.
If a Tax Event has occurred and is continuing and:
(a) the Company has received a Redemption Tax Opinion; or
(b) after receiving a Dissolution Tax Opinion, the Regular
Trustees shall have been informed by tax counsel ren-
dering the Dissolution Tax Opinion that a No Recogni-
tion Opinion cannot be delivered to the Trust, then,
notwithstanding Section 3.2(a) but subject to Section
3.2(b), the Company shall have the right upon not less
than 30 days nor more than 60 days notice to the
Holders of the Notes to redeem the Notes in whole or in
part for cash within 90 days following the occurrence
of such Tax Event (the "90 Day Period"), provided that,
if at the time there is available to the Company the
opportunity to eliminate within the 90 Day Period, the
Tax Event by taking some ministerial action ("Minis-
terial Action"), such as filing a form or making an
election, or pursuing some other similar reasonable
measure which has no adverse effect on the Company, the
Trust or the Holders of the Trust Securities issued by
the Trust, the Company shall pursue such Ministerial
Action in lieu of redemption, and provided, further,
that the Company shall have no right to redeem the
Notes while the Trust is pursuing any Ministerial
Action pursuant to its obligations under the Declara-
tion. The Redemption Price shall be paid prior to 12:00
noon, New York time, on the date of such redemption or
such earlier time as the Company determines provided that
the Company shall deposit with the Trustee an amount
sufficient to pay the Redemption Price by 10:00 a.m. on
the date such Redemption Price is to be paid.
SECTION 3.2. Optional Redemption by Company.
(a) Subject to the provisions of Section 3.2(b) and to the
provisions of Article Eleven of the Indenture, except
as otherwise may be specified in this First Supplemen-
tal Indenture, the Company shall have the right to
redeem the Notes, in whole or in part, from time to
time, on or after ____________, 2000, at a redemption
price equal to 100% of the principal amount to be re-
deemed plus any accrued and unpaid interest thereon to
the date of such redemption (the "Optional Redemption
Price"). Any redemption pursuant to this paragraph
will be made upon not less than 30 nor more than 60
days' notice to the Holder of the Notes, at the
Optional Redemption Price. If the Notes are only
partially redeemed pursuant to this Section 3.2, the
Notes will be redeemed pro rata or by lot or by any
other method utilized by the Trustee; provided that, if
at the time of redemption the Notes are registered as a
Global Note, the Depository shall determine by lot the
principal amount of such Notes held by each Holder of
Note to be redeemed. The Optional Redemption Price shall
be paid prior to 12:00 noon, New York time, on the date
of such redemption or at such earlier time as the Company
determines provided that the Company shall deposit with
the Trustee an amount sufficient to pay the Optional
Redemption Price by 10:00 a.m. on the date such Optional
Redemption Price is to be paid.
(b) If a partial redemption of the Notes would result in
the delisting of the Preferred Securities issued by the
Trust from any national securities exchange or other
organization on which the Preferred Securities are then
listed, the Company shall not be permitted to effect
such partial redemption and may only redeem the Notes
in whole.
SECTION 3.3. No Sinking Fund.
The Notes are not entitled to the benefit of any sinking fund.
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 4.1. Extension of Interest Payment Period.
The Company shall have the right, at any time during the term of
the Notes, from time to time to defer payments of interest by
extending the interest payment period of such Notes for up to 20
consecutive quarters (the "Extended Interest Payment Period").
To the extent permitted by applicable law, interest, the payment
of which has been deferred because of the extension of the
interest payment period pursuant to this Section 4.1, will bear
interest thereon at the Coupon Rate compounded quarterly for each
quarter of the Extended Interest Payment Period ("Compounded
Interest"). At the end of the Extended Interest Payment Period
the Company shall pay all interest accrued and unpaid on the
Notes, including any Additional Interest and Compounded Interest
("Deferred Interest") that shall be payable, to the Holders of
the Notes in whose names the Notes are registered in the Security
Register on the first record date after the end of the Extended
Interest Payment Period. Before the termination of any Extended
Interest Payment Period, the Company may further extend such
period, provided that such period together with all such further
extensions thereof shall not exceed 20 consecutive quarters.
Upon the termination of any Extended Interest Payment Period and
upon the payment of all Deferred Interest then due, the Company
may commence a new Extended Interest Payment Period, subject to
the foregoing requirements. No interest shall be due and payable
during an Extended Interest Payment Period, except at the end
thereof.
SECTION 4.2. Notice of Extension.
(a) If the Property Trustee is the only registered Holder
of the Notes at the time the Company selects an
Extended Interest Payment Period, the Company shall
give written notice to the Regular Trustees, the Property
Trustee and the Trustee of its selection of such Extended
Interest Payment Period one Business Day before the
earlier of (a) the next succeeding date on which Dis-
tributions on the Trust Securities issued by the Trust
are payable, or (b) the date the Trust is required to
give notice of the record date or the date such Dis-
tributions are payable to the New York Stock Exchange
or other applicable self-regulatory organization or to
holders of the Preferred Securities issued by the
Trust, but in any event at least one Business Day
before such record date.
(b) If the Property Trustee is not the only Holder of the
Notes at the time the Company selects an Extended In-
terest Payment Period, the Company shall give the
Holders of the Notes and the Trustee written notice of
its selection of such Extended Interest Payment Period 10
Business Days before the earlier of (i) the next
succeeding Interest Payment Date, or (ii) the date the
Company is required to give notice of the record or
payment date of such interest payment to the New York
Stock Exchange or other applicable self-regulatory
organization or to Holders of the Notes.
(c) The quarter in which any notice is given pursuant to
paragraphs (a) or (b) of this Section 4.2 shall be
counted as one of the 20 quarters permitted in the
maximum Extended Interest Payment Period permitted
under Section 4.1.
ARTICLE V
EXPENSES
SECTION 5.1. Payment of Expenses.
In connection with the offering, sale and issuance of the Notes
to the Property Trustee in connection with the sale of the Trust
Securities by the Trust, the Company shall:
(a) pay for all costs and expenses relating to the
offering, sale and issuance of the Notes, including
commissions to the underwriters payable pursuant to the
Underwriting Agreement and the Pricing Agreement and
compensation of the Trustee under the Indenture in
accordance with the provisions of Section 7.06 of the
Indenture;
(b) pay for all costs and expenses of the Trust (including,
but not limited to, costs and expenses relating to the
organization of the Trust, the offering, sale and
issuance of the Trust Securities (including commissions
to the underwriters in connection therewith), the fees
and expenses of the Property Trustee and the Delaware
Trustee, the costs and expenses relating to the opera-
tion of the Trust, including without limitation, costs
and expenses of accountants, attorneys, statistical or
bookkeeping services, expenses for printing and
engraving and computing or accounting equipment, paying
agent(s), registrar(s), transfer agent(s), duplicating,
travel and telephone and other telecommunications ex-
penses and costs and expenses incurred in connection
with the acquisition, financing, and disposition of
Trust assets); and
(c) pay any and all taxes (other than United States with-
holding taxes attributable to the Trust or its assets)
and all liabilities, costs and expenses with respect to
such taxes of the Trust.
ARTICLE VI
SUBORDINATION
SECTION 6.1. Agreement to Subordinate.
The Company covenants and agrees, and each Holder of Notes issued
hereunder by such Holder's acceptance thereof likewise covenants
and agrees, that all Notes shall be issued subject to the provi-
sions of this Article Six; and each Holder of a Note, whether
upon original issue or upon transfer or assignment thereof,
accepts and agrees to be bound by such provisions.
The payment by the Company of the principal of, premium, if any,
and interest on all Notes issued hereunder shall, to the extent
and in the manner hereinafter set forth, be subordinated and
junior in right of payment to the prior payment in full of all
Senior Indebtedness of the Company, whether outstanding at the
date of this Indenture or thereafter incurred.
No provision of this Article Six shall prevent the occurrence of
any default or Event of Default hereunder.
SECTION 6.2. Default on Senior Indebtedness.
In the event and during the continuation of any default by the
Company in the payment of principal, premium, interest or any
other payment due on any Senior Indebtedness of the Company, as
the case may be, or in the event that the maturity of any Senior
Indebtedness of the Company, as the case may be, has been
accelerated because of a default, then, in either case, no
payment shall be made by the Company with respect to the princi-
pal (including redemption and sinking fund payments) of, or
premium, if any, or interest on the Notes.
In the event that, notwithstanding the foregoing, any payment
shall be received by the Trustee when such payment is prohibited
by the preceding paragraph of this Section 6.2, such payment
shall be held in trust for the benefit of, and shall be paid over
or delivered to, the holders of Senior Indebtedness or their
respective representatives, or to the trustee or trustees under
any indenture pursuant to which any of such Senior Indebtedness
may have been issued, as their respective interests may appear,
but only to the extent that the holders of the Senior Indebted-
ness (or their representative or representatives or a trustee)
notify the Trustee within 90 days of such payment of the amounts
then due and owing on the Senior Indebtedness and only the
amounts specified in such notice to the Trustee shall be paid
to the holders of Senior Indebtedness.
SECTION 6.3. Liquidation; Dissolution; Bankruptcy.
Upon any payment by the Company or distribution of assets of the
Company of any kind or character, whether in cash, property or
securities, to creditors upon any dissolution or winding-up or
liquidation or reorganization of the Company, whether voluntary
or involuntary or in bankruptcy, insolvency, receivership or
other proceedings, all amounts due upon all Senior Indebtedness
of the Company shall first be paid in full, or payment thereof
provided for in money in accordance with its terms, before any
payment is made by the Company on account of the principal (and
premium, if any) or interest on the Notes; and upon any such
dissolution or winding-up or liquidation or reorganization, any
payment by the Company, or distribution of assets of the Company
of any kind or character, whether in cash, property or securi-
ties, to which the Holders of the Note or the Trustee would be
entitled to receive from the Company, except for the provisions
of this Article Six, shall be paid by the Company or by any
receiver, trustee in bankruptcy, liquidating trustee, agent or
other Person making such payment or distribution, or by the
Holders of the Notes or by the Trustee under this Indenture if
received by them or it, directly to the holders of Senior
Indebtedness of the Company (pro rata to such holders on the
basis of the respective amounts of Senior Indebtedness held by
such holders, as calculated by the Company) or their represen-
tative or representatives, or to the trustee or trustees under
any indenture pursuant to which any instruments evidencing such
Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay such Senior
Indebtedness in full, in money or money's worth, after giving
effect to any concurrent payment or distribution to or for the
holders of such Senior Indebtedness, before any payment or dis-
tribution is made to the Holders of Notes or to the Trustee.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character,
whether in cash, property or securities, prohibited by the
foregoing, shall be received by the Trustee before all Senior
Indebtedness of the Company is paid in full, or provision is made
for such payment in money in accordance with its terms, such
payment or distribution shall be held in trust for the benefit of
and shall be paid over or delivered to the holders of such Senior
Indebtedness or their representative or representatives, or to
the trustee or trustees under any indenture pursuant to which any
instruments evidencing such Senior Indebtedness may have been
issued, and their respective interests may appear, as calculated
by the Company, for application to the payment of all Senior
Indebtedness of the Company, as the case may be, remaining unpaid
to the extent necessary to pay such Senior Indebtedness in full
in money in accordance with its terms, after giving effect to any
concurrent payment or distribution to or for the holders of such
Senior Indebtedness.
For purposes of this Article Six, the words "cash, property or
securities" shall not be deemed to include shares of stock of the
Company as reorganized or readjusted, or securities of the Com-
pany or any other corporation provided for by a plan of reorgani-
zation or readjustment, the payment of which is subordinated at
least to the extent provided in this Article Six with respect to
the Notes to the payment of all Senior Indebtedness of the Com-
pany, as the case may be, that may at the time be outstanding,
provided that (i) such Senior Indebtedness is assumed by the new
corporation, if any, resulting from any such reorganization or
readjustment, and (ii) the rights of the holders of such Senior
Indebtedness are not, without the consent of such holders,
altered by such reorganization or readjustment. The consolida
tion of the Company with, or the merger of the Company into,
another corporation or the liquidation or dissolution of the
Company following the conveyance or transfer of its property as
an entirety, or substantially as an entirety, to another corpora-
tion upon the terms and conditions provided for in Article Eight
of the Indenture shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section
6.3 if such other corporation shall, as a part of such consolida-
dation, merger, conveyance or transfer, comply with the condi-
tions stated in Article Eight of the Indenture. Nothing in
Section 6.2 or in this Section 6.3 shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 606 of the
Indenture.
SECTION 6.4. Subrogation.
Subject to the payment in full of all Senior Indebtedness of the
Company, the rights of the Holders of the Notes shall be
subrogated to the rights of the holders of such Senior Indebted-
ness to receive payments or distributions of cash, property or
securities of the Company, as the case may be, applicable to such
Senior Indebtedness until the principal of (and premium, if any)
and interest on the Notes shall be paid in full; and, for the
purposes of such subrogation, no payments or distributions to the
holders of such Senior Indebtedness of any cash, property or
securities to which the Holders of the Notes or the Trustee would
be entitled except for the provisions of this Article Six, and no
payment over pursuant to the provisions of this Article Six to or
for the benefit of the holders of such Senior Indebtedness by
Holders of the Notes or the Trustee, shall, as between the Com-
pany, its creditors other than Holders of Senior Indebtedness of
the Company, and the holders of the Notes shall be deemed to be a
payment by the Company to or on account of such Senior Indebted-
ness. It is understood that the provisions of this Article Six
are and are intended solely for the purposes of defining the
relative rights of the Holders of the Notes, on the one hand, and
the holders of such Senior Indebtedness on the other hand.
Nothing contained in this Article Six or elsewhere in this Inden-
ture or in the Notes is intended to or shall impair, as between
the Company, its creditors other than the holders of Senior
Indebtedness of the Company, and the Holders of the Notes, the
obligation of the Company, which is absolute and unconditional,
to pay to the Holders of the Notes the principal of (and premium,
if any) and interest on the Notes as and when the same shall
become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders of
the Notes and creditors of the Company, as the case may be, other
than the holders of Senior Indebtedness of the Company, as the
case may be, nor shall anything herein or therein prevent the
Trustee or the Holder of any Note from exercising all remedies
otherwise permitted by applicable law upon default under the
Indenture, subject to the rights, if any, under this Article Six
of the holders of such Senior Indebtedness in respect of cash,
property or securities of the Company, as the case may be,
received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company
referred to in this Article Six, the Trustee, subject to the
provisions of Section 602 of the Indenture, and the Holders of
the Notes shall be entitled to rely upon any order or decree made
by any court of competent jurisdiction in which such dissolution,
winding-up, liquidation or reorganization proceedings are
pending, or a certificate of the receiver, trustee in bankruptcy,
liquidation trustee, agent or other Person making such payment or
distribution, delivered to the Trustee or to the Holders of the
Notes, for the purposes of ascertaining the Persons entitled to
participate in such distribution, the holders of Senior Indebted-
ness and other indebtedness of the Company, as the case may be,
the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or
to this Article Six.
SECTION 6.5. Trustee to Effectuate Subordination.
Each Holder of Notes by such Holder's acceptance thereof
authorizes and directs the Trustee on such Holder's behalf to
take such action as may be necessary or appropriate to effectuate
the subordination provided in this Article Six and appoints the
Trustee such Holder's attorney-in-fact for any and all such
purposes.
SECTION 6.6. Notice by the Company.
The Company shall give prompt written notice to a Responsible
Officer of the Trustee of any fact known to the Company that
would prohibit the making of any payment of monies to or by the
Trustee in respect of the Notes pursuant to the provisions of
this Article Six. Notwithstanding the provisions of this Article
Six or any other provision of the Indenture and this First Sup-
plemental Indenture, the Trustee shall not be charged with knowl-
edge of the existence of any facts that would prohibit the making
of any payment of monies to or by the Trustee in respect of the
Notes pursuant to the provisions of this Article Six, unless and
until a Responsible Officer of the Trustee shall have received
written notice thereof from the Company or a holder or holders of
Senior Indebtedness or from any trustee therefor; and before the
receipt of any such written notice, the Trustee, subject to the
provisions of Section 602 of the Indenture, shall be entitled in
all respects to assume that no such facts exist; provided,
________
however, that, if the Trustee shall not have received the notice
_______
provided for in this Section 6.6 at least two Business Days prior
to the date upon which by the terms hereof any money may become
payable for any purpose (including, without limitation, the pay-
ment of the principal of (or premium, if any) or interest on any
Note), then, anything herein contained to the contrary notwith-
standing, the Trustee shall have full power and authority to
receive such money and to apply the same to the purposes for
which they were received, and shall not be affected by any notice
to the contrary that may be received by it within two Business
Days prior to such date.
The Trustee, subject to the provisions of Section 602 of the
Indenture, shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself to be a holder of
Senior Indebtedness of the Company, as the case may be (or a
trustee on behalf of such holder) to establish that such notice
has been given by a holder of such Senior Indebtedness or a
trustee on behalf of any such holder or holders. In the event
that the Trustee determines in good faith that further evidence
is required with respect to the right of any Person as a holder
of such Senior Indebtedness to participate in any payment or
distribution pursuant to this Article Six, the Trustee may
request such Person to furnish evidence to the reasonable satis-
faction of the Trustee as to the amount of such Senior Indebted-
ness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any
other facts pertinent to the rights of such Person under this
Article Six, and, if such evidence is not furnished, the Trustee
may defer any payment to such Person pending judicial determina-
tion as to the right of such Person to receive such payment.
SECTION 6.7. Rights of the Trustee; Holders of Senior Indebted-
ness.
The Trustee in its individual capacity shall be entitled to all
the rights set forth in this Article Six in respect of any Senior
Indebtedness at any time held by it, to the same extent as any
other holder of Senior Indebtedness, and nothing in this Inden-
ture shall deprive the Trustee of any of its rights as such
holder.
With respect to the holders of Senior Indebtedness of the
Company, the Trustee undertakes to perform or to observe only
such of its covenants and obligations as are specifically set
forth in this Article Six, and no implied covenants or obliga-
tions with respect to the holders of such Senior Indebtedness
shall be read into this Indenture against the Trustee. The
Trustee shall not be deemed to owe any fiduciary duty to the
holders of such Senior Indebtedness and, subject to the provi-
sions of Section 602 of the Indenture, the Trustee shall not be
liable to any holder of such Senior Indebtedness if it shall pay
over or deliver to Holders of Notes, the Company or any other
Person money or assets to which any holder of such Senior
Indebtedness shall be entitled by virtue of this Article Six or
otherwise.
SECTION 6.8. Subordination May Not Be Impaired.
No right of any present or future holder of any Senior Indebted-
ness of the Company to enforce subordination as herein provided
shall at any time in any way be prejudiced or impaired by any act
or failure to act on the part of the Company, as the case may be,
or by any act or failure to act, in good faith, by any such
holder, or by any noncompliance by the Company, as the case may
be, with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof that any such holder may have
or otherwise be charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness of the Company may,
at any time and from time to time, without the consent of or
notice to the Trustee or the Holders of the Notes, without incur-
ring responsibility to the Holders of the Notes and without
impairing or releasing the subordination provided in this Article
Six or the obligations hereunder of the Holders of the Notes to
the holders of such Senior Indebtedness, do any one or more the
following: (i) change the manner, place or terms of payment or
extend the time of payment of, or renew or alter, such Senior
Indebtedness, or otherwise amend or supplement in any manner such
Senior Indebtedness or any instrument evidencing the same or any
agreement under which such Senior Indebtedness is outstanding;
(ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing such Senior Indebted-
ness; (iii) release any Person liable in any manner for the col-
lection of such Senior Indebtedness; and (iv) exercise or
refrain from exercising any rights against the Company, as the
case may be, and any other Person.
ARTICLE VII
COVENANT TO LIST ON EXCHANGE
SECTION 7.1. Listing on an Exchange.
If the Notes are to be issued as a Global Note in connection with
the distribution of the Notes to the holders of the Preferred
Securities issued by the Trust upon a Dissolution Event, the Com-
pany will use its best efforts to list such Notes on the New York
Stock Exchange or on such other exchange as the Preferred Securi-
ties are then listed.
ARTICLE VIII
FORM OF NOTE
SECTION 8.1. Form of Note.
The Notes and the Trustee's Certificate of Authentication to be
endorsed thereon are to be substantially in the following forms:
(FORM OF FACE OF NOTE)
[IF THE NOTE IS TO BE A GLOBAL NOTE, INSERT - This Note is a
Global Note within the meaning of the Indenture hereinafter
referred to and is registered in the name of a Depository or a
nominee of a Depository. This Note is exchangeable for Notes
registered in the name of a person other than the Depository or
its nominee only in the limited circumstances described in the
Indenture, and no transfer of this Note (other than a transfer of
this Note 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) may be registered except in
limited circumstances.
Unless this Note is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York, New
York) to the issuer or its agent for registration of transfer,
exchange or payment, and any Note issued is registered in the
name of Cede & Co. or such other name as requested by an autho-
rized representative of The Depository Trust Company and any
payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL
since the registered owner hereof, Cede & Co., has an interest
herein.]
No. __________________
$_____________
CUSIP No._____________
[ ]
____% SUBORDINATED DEFERRABLE INTEREST NOTE
DUE 2025
Southern Union Company, a Delaware corporation (the "Company",
which term includes any successor corporation under the Indenture
hereinafter referred to), for value received, hereby promises to
pay to _______________, or registered assigns, the principal sum
of _____________ Dollars on ____________, 2025, (or on such later
date before ______, 2044, if the Company elects to extend the
maturity date as further described herein), and to pay interest
on said principal sum from ____________, 1995, or from the most
recent interest payment date (each such date, an "Interest
Payment Date") to which interest has been paid or duly provided
for, quarterly (subject to deferral as set forth herein) in
arrears on March 31, June 30, September 30 and December 31 of
each year commencing _____________, 1995, at the rate of _____%
per annum until the principal hereof shall have become due and
payable, and on any overdue principal and premium, if any, and
(without duplication and to the extent that payment of such
interest is enforceable under applicable law) on any overdue
installment of interest at the same rate per annum compounded
quarterly. The amount of interest payable on any Interest
Payment Date shall be computed on the basis of a 360-day year of
twelve 30-day months. In the event that any date on which
interest is payable on this Note is not a Business Day, then
payment of interest payable on such date will be made on the next
succeeding day that is a Business Day (and without any interest
or other payment in respect of any such delay), except that, if
such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day,
in each case with the same force and effect as if made on such
date. The interest installment so payable, and punctually paid
or duly provided for, on any Interest Payment Date will, as
provided in the Indenture, be paid to the person in whose name
this Note (or one or more Predecessor Notes, as defined in said
Indenture) is registered at the close of business on the regular
record date for such interest installment, which shall be the
close of business on the business day next preceding such
Interest Payment Date. [IF PURSUANT TO THE PROVISIONS OF THE
INDENTURE THE NOTES ARE NO LONGER REPRESENTED BY A GLOBAL NOTE --
which shall be the close of business on the ____ business day
next preceding such Interest Payment Date.] Any such interest
installment not punctually paid or duly provided for shall
forthwith cease to be payable to the registered Holders on such
regular record date and may be paid to the Person in whose name
this Note (or one or more Predecessor Notes) is registered at the
close of business on a special record date to be fixed by the
Trustee for the payment of such defaulted interest, notice
whereof shall be given to the registered Holders of this series
of Notes not less than 10 days prior to such special record date,
or may be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on
which the Notes may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the
Indenture. The principal of (and premium, if any) and the
interest on this Note shall be payable at the office or agency of
the Trustee maintained for that purpose in any coin or currency
of the United States of America that at the time of payment is
legal tender for payment of public and private debts; provided,
however, that payment of interest may be made at the option of
the Company by check mailed to the registered Holder at such
address as shall appear in the Security Register. Notwith-
standing the foregoing, so long as the Holder of this Note is the
Property Trustee, the payment of the principal of (and premium,
if any) and interest on this Note will be made at such place and
to such account as may be designated by the Property Trustee.
The indebtedness evidenced by this Note is, to the extent
provided in the Indenture, subordinate and junior in right of
payment to the prior payment in full of all Senior Indebtedness,
and this Note is issued subject to the provisions of the
Indenture with respect thereto. Each Holder of this Note, by
accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his or her
behalf to take such action as may be necessary or appropriate to
acknowledge or effectuate the subordination so provided and (c)
appoints the Trustee his or her attorney-in-fact for any and all
such purposes. Each Holder hereof, by his or her acceptance
hereof, hereby waives all notice of the acceptance of the subor-
dination provisions contained herein and in the Indenture by each
holder of Senior Indebtedness, whether now outstanding or here-
after incurred, and waives reliance by each such holder upon
said provisions.
This Note shall not be entitled to any benefit under the Inden-
ture Indenture hereinafter referred to, be valid or become
obligatory for any purpose until the Certificate of Authentica-
cation hereon shall have been signed by or on behalf of the
Trustee.
Unless the Certificate of Authentication hereon has been executed
by the Trustee referred to on the reverse side hereof, this Note
shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
The provisions of this Note are continued on the reverse side
hereof and such continued provisions shall for all purposes have
the same effect as though fully set forth at this place.
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be
executed.
Dated___________________
SOUTHERN UNION COMPANY
By______________________
[ ]
Attest:
By_____________________
Secretary
<PAGE>
(FORM OF CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is one of the Notes of the series of Notes described in the
within-mentioned Indenture.
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION)
_________________________ _______________________
as Trustee or as Authentication Agent
By_______________________ By_____________________
Authorized Signatory Authorized Signatory
(FORM OF REVERSE OF NOTE)
This Note is one of a duly authorized series of Notes of the
Company (herein sometimes referred to as the "Notes"), specified
in the Indenture, all issued or to be issued in one or more
series under and pursuant to an Indenture dated as of
______________, 1995, duly executed and delivered between the
Company and The Chase Manhattan Bank, National Association, as
Trustee (the "Trustee"), as supplemented by the First Supplemented
Indenture dated as of ____________, 1995, between the Company and
the Trustee (the Indenture as so supplemented, the "Indenture"), to
which Indenture and all indentures supplemental thereto reference
is hereby made for a description of the rights, limitations of
rights, obligations, duties and immunities thereunder of the
Trustee, the Company and the Holders of the Notes. By the terms
of the Indenture, the Notes are issuable in series that may vary
as to amount, date of maturity, rate of interest and in other
respects as provided in the Indenture. This series of Notes is
limited in aggregate principal amount as specified in said First
Supplemental Indenture.
Because of the occurrence and continuation of a Tax Event, in
certain circumstances, this Note will become due and payable at
the principal amount together with any interest accrued thereon
(the "Redemption Price"). The Redemption Price shall be paid
prior to 12:00 noon, New York time, on the date of such redempt-
tion or at such earlier time as the Company determines. The
Company shall have the right to redeem this Note at the option of
the Company, without premium or penalty, in whole or in part at
any time on or after _____________, 2000 (an "Optional Redemp-
tion") or at any time in certain circumstances upon the
occurrence of a Tax Event, at a redemption price equal to 100% of
the principal amount plus any accrued but unpaid interest, to the
date of such redemption (the "Optional Redemption Price"). Any
redemption pursuant to this paragraph will be made upon not less
than 30 nor more than 60 days' notice, at the Optional Redemption
Price. If the Notes are only partially redeemed by the Company
pursuant to an Optional Redemption, the Notes will be redeemed
pro rata or by lot or by any other method utilized by the
Trustee; provided that if, at the time of redemption, the Notes
are registered as a Global Note, the Depository shall determine
by lot the principal amount of such Notes held by each Noteholder
to be redeemed.
In the event of redemption of this Note in part only, a new Note
or Notes of this series for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation
hereof.
In case an Event of Default, as defined in the Indenture, shall
have occurred and be continuing, the principal of all of the
Notes may be declared, and upon such declaration shall become,
due and payable, in the manner, with the effect and subject to
the conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the Holders of not less than a
majority in aggregate principal amount of the Notes of each
series affected at the time outstanding, as defined in the
Indenture, to execute supplemental indentures for the purpose of
adding any provisions to or changing in any manner or eliminating
any of the provisions of the Indenture or of any supplemental
indenture or of modifying in any manner the rights of the Holders
of the Notes; provided, however, that no such supplemental inden-
ture shall (i) extend the fixed maturity of any Notes of any
series, or reduce the principal amount thereof, or reduce the
rate or extend the time of payment of interest thereon, or reduce
any premium payable upon the redemption thereof, without the
consent of the Holder of each Note so affected, or (ii) reduce
the aforesaid percentage of Notes, the Holders of which are
required to consent to any such supplemental indenture, without
the consent of the Holders of each Note then outstanding and
affected thereby. The Indenture also contains provisions
permitting the Holders of a majority in aggregate principal
amount of the Notes of any series at the time outstanding
affected thereby, on behalf of all of the Holders of the Notes of
such series, to waive any past default in the performance of any
of the covenants contained in the Indenture, or established
pursuant to the Indenture with respect to such series, and its
consequences, except a default in the payment of the principal of
or premium, if any, or interest on any of the Notes of such
series. Any such consent or waiver by the registered Holder of
this Note (unless revoked as provided in the Indenture) shall be
conclusive and binding upon such Holder and upon all future
Holders and owners of this Note and of any Note issued in
exchange herefor or in place hereof (whether by registration of
transfer or otherwise), irrespective of whether or not any
notation of such consent or waiver is made upon this Note.
No reference herein to the Indenture and no provision of this
Note or of the Indenture shall alter or impair the obligation of
the Company, which is absolute and unconditional, to pay the
principal of and premium, if any, and interest on this Note at
the time and place and at the rate and in the money herein
prescribed.
The Company shall have the right at any time during the term of
the Notes from time to time to extend the interest payment period
of such Notes to up to 20 consecutive quarters (an "Extended
Interest Payment Period"), at the end of which period the Company
shall pay all interest then accrued and unpaid (together with
interest thereon at the rate specified for the Notes to the
extent that payment of such interest is enforceable under
applicable law). Before the termination of any such Extended
Interest Payment Period, the Company may further extend such
Extended Interest Payment Period, provided that such Extended
Interest Payment Period together with all such further extensions
thereof shall not exceed 20 consecutive quarters. At the
termination of any such Extended Interest Payment Period and upon
the payment of all accrued and unpaid interest and any additional
amounts then due, the Company may commence a new Extended
Interest Payment Period.
As provided in the Indenture and subject to certain limitations
therein set forth, this Note is transferable by the registered
Holder hereof on the Security Register of the Company, upon
surrender of this Note for registration of transfer at the office
or agency of the Company in the City and State of New York
accompanied by a written instrument or instruments of transfer in
form satisfactory to the Company or the Trustee duly executed by
the registered Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Notes of authorized
denominations and for the same aggregate principal amount and
series will be issued to the designated transferee or transferees.
No service charge will be made for any such transfer, but the
Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in relation thereto.
Prior to due presentment for registration of transfer of this
Note, the Company, the Trustee, any paying agent and any Security
Registrar may deem and treat the registered holder hereof as the
absolute owner hereof (whether or not this Note shall be overdue
and notwithstanding any notice of ownership or writing hereon
made by anyone other than the Security Registrar) for the purpose
of receiving payment of or on account of the principal hereof and
premium, if any, and interest due hereon and for all other pur-
poses, and neither the Company nor the Trustee nor any paying
agent nor any Note Registrar shall be affected by any notice to
the contrary.
No recourse shall be had for the payment of the principal of or
the interest on this Note, or for any claim based hereon, or
otherwise in respect hereof, or based on or in respect of the
Indenture, against any incorporator, stockholder, officer or
director, past, present or future, as such, of the Company or of
any predecessor or successor corporation, whether by virtue of
any constitution, statute or rule of law, or by the enforcement
of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration
for the issuance hereof, expressly waived and released.
The debentures of this series are issuable only in registered
form without coupons in denominations of $25 and any integral
multiple thereof. This Global Note is exchangeable for Notes in
definitive form only under certain limited circumstances set
forth in the Indenture. Notes of this series so issued are
issuable only in registered form without coupons in denominations
of $25 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations [herein and] therein
set forth, Notes of this series [so issued] are exchangeable for
a like aggregate principal amount of Notes of this series of a
different authorized denomination, as requested by the Holder
surrendering the same.
All terms used in this Note that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
ARTICLE IX
ORIGINAL ISSUE OF NOTES
SECTION 9.1. Original Issue of Notes.
Notes in the aggregate principal amount of $________ may, upon
execution of this First Supplemental Indenture, be executed by
the Company and delivered to the Trustee for authentication, and
the Trustee shall thereupon authenticate and deliver said Notes
to or upon the written order of the Company, signed by its
Chairman, its President, or any Vice President and its Treasurer
or an Assistant Treasurer, without any further action by the
Company.
ARTICLE X
MISCELLANEOUS
SECTION 10.1. Ratification of Indenture.
The Indenture, as supplemented by this First Supplemental Inden-
ture, is in all respects ratified and confirmed, and this First
Supplemental Indenture shall be deemed part of the Indenture in
the manner and to the extent herein and therein provided.
SECTION 10.2. Trustee Not Responsible for Recitals.
The recitals herein contained are made by the Company and not by
the Trustee, and the Trustee assumes no responsibility for the
correctness thereof. The Trustee makes no representation as to
the validity or sufficiency of this First Supplemental Indenture.
SECTION 10.3. Governing Law.
This First Supplemental Indenture and each Note shall be deemed
to be a contract made under the internal laws of the State of New
York, and for all purposes shall be construed in accordance with
the laws of said State.
SECTION 10.4. Separability.
In case any one or more of the provisions contained in this First
Supplemental Indenture or in the Notes shall for any reason be
held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any
other provisions of this First Supplemental Indenture or of the
Notes, but First Supplemental Indenture and the Notes shall be
construed as if such invalid or illegal or unenforceable provi-
sion had never been contained herein or therein.
SECTION 10.5. Counterparts.
This First Supplemental Indenture may be executed in any number
of counterparts each of which shall be an original; but such
counterparts shall together constitute but one and the same
instrument.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed, and their respective
corporate seals to be hereunto affixed and attested, on the date
or dates indicated in the acknowledgements and as of the day and
year first above written.
SOUTHERN UNION COMPANY
By___________________________
Attest:
________________________
Secretary
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION)
as Trustee
By_____________________________
Attest:
__________________________________
Secretary
<PAGE>
STATE OF )
COUNTY OF ) ss.:
On the _______ day of_______________, 1995, before me personally
came ____________________________ to be known, who, being by me
duly sworn, did depose and say that he is the _______________
_____________________ of Southern Union Company, one of the
corporations described in and which executed the above instru-
ment; that he knows the corporate seal of said corporation; that
the seal affixed to the said instrument is such corporation seal;
that it was so affixed by authority of the Board of Directors of
said corporation, and that he signed his name thereto by like
authority.
_______________________________
NOTARY PUBLIC
[seal] Commission expires
STATE OF )
COUNTY OF ) SS.:
On the ______ day of _____________, 1995, before me personally
came _____________________________ to be known, who, being by me
duly sworn, did depose and say that he is the ________________
_____________________ of The Chase Manhattan Bank, N.A., one of the
corporations described in and which executed the above instru-
ment; that he knows the corporate seal of said corporation; that
the seal affixed to the said instrument is such corporation seal;
that it was so affixed by authority of the Board of Directors of
said corporation, and that he signed his name thereto by like
authority.
_____________________________________
NOTARY PUBLIC
[seal] Commission expires
<PAGE>
EXHIBIT 4-K
PREFERRED SECURITIES GUARANTEE AGREEMENT
<PAGE>
====================================
PREFERRED SECURITIES GUARANTEE AGREEMENT
[ ]
Dated as of __________, 1995
====================================
<PAGE>
PREFERRED SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT ("Guarantee Agreement"), dated as of
_____________, 1995, is executed and delivered by Southern Union
Company, a Delaware corporation (the "Guarantor"), and
Wilmington Trust Company, a Delaware banking Corporation, as
trustee (the "Preferred Guarantee Trustee"), for the benefit of the
Holders (as defined herein) from time to time of the Preferred
Securities (as defined herein) of Southern Union Financing [ ],
a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust
(the "Declaration"), dated as of __________, 1995, among the
trustees of the Issuer named therein, the Guarantor as Sponsor
and the holders from time to time of undivided beneficial
interests in the assets of the Issuer, the Issuer is issuing on
the date hereof $__________ aggregate stated liquidation amount
of Preferred Securities designated the ____% Trust Originated
Preferred Securities (the "Preferred Securities");
WHEREAS, as incentive for the Holders to purchase the Preferred
Securities, the Guarantor desires irrevocably and unconditionally
to agree, to the extent set forth in this Guarantee Agreement, to
pay to the Holders of the Preferred Securities the Guarantee Pay-
ments (as defined herein) and to make certain other payments on
the terms and conditions set forth herein.
WHEREAS, the Guarantor is also executing and delivering a
guarantee agreement (the "Common Securities Guarantee Agreement")
in substantially identical terms to this Guarantee Agreement for
the benefit of the holders of the Common Securities (as defined
herein) except that if an Event of Default (as defined in the
Indenture (as defined herein)), has occurred and is continuing,
the rights of holders of the Common Securities to receive
Guarantee Payments under the Common Securities Guarantee are
subordinated to the rights of Holders of Preferred Securities to
receive Guarantee Payments under this Guarantee Agreement.
NOW, THEREFORE, in consideration of the purchase by each Holder
of Preferred Securities, which purchase the Guarantor hereby
agrees shall benefit the Guarantor, the Guarantor executes and
delivers this Guarantee Agreement for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1. Definitions and Interpretation
In this Guarantee Agreement, unless the context otherwise
requires:
(a) Capitalized terms used in this Guarantee Agreement but
not defined in the preamble above have the respective
meanings assigned to them in this Section 1.1;
(b) a term defined anywhere in this Guarantee Agreement has
the same meaning throughout;
(c) all references to "the Guarantee Agreement" or "this
Guarantee Agreement" are to this Guarantee Agreement as
modified, supplemented or amended from time to time;
(d) all references in this Guarantee Agreement to Articles
and Sections are to Articles and Sections of this
Guarantee Agreement unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Guarantee Agreement unless
otherwise defined in this Guarantee Agreement or unless
the context otherwise requires; and
(f) a reference to the singular includes the plural and
vice versa.
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act of 1933, as amended, or any successor
rule thereunder.
"Common Securities" means the securities representing common
undivided beneficial interests in the assets of the Issuer.
"Covered Person" means any Holder or beneficial owner of Preferred
Securities.
"Event of Default" means a default by the Guarantor on any of its
payment or other obligations under this Guarantee Agreement.
"Guarantee Payments" means the following payments or distribu-
tions, without duplication, with respect to the Preferred Securi-
ties, to the extent not paid or made by the Issuer: (i) any
accrued and unpaid Distributions (as defined in the Declaration)
that are required to be paid on such Preferred Securities to the
extent the Issuer shall have funds available therefore, (ii) the
redemption price, including all accrued and unpaid Distributions
to the date of redemption (the "Redemption Price") to the extent
the Issuer has funds available therefor, with respect to any Pre-
ferred Securities called for redemption by the Issuer, and (iii)
upon a voluntary or involuntary dissolution, winding-up or termi-
nation of the Issuer (other than in connection with the distribu-
tion of Debentures to the Holders in exchange for Preferred
Securities as provided in the Declaration), the lesser of (a) the
aggregate of the liquidation amount and all accrued and unpaid
Distributions on the Preferred Securities to the date of payment,
and (b) the amount of assets of the Issuer remaining available
for distribution to Holders in liquidation of the Issuer (in
either case, the "Liquidation Distribution"). If an event of
default under the Indenture has occurred and is continuing, the
rights of holders of the Common Securities to receive payments
under the Common Securities Guarantee Agreement are subordinated
to the rights of Holders of Preferred Securities to receive
Guarantee Payments.
"Holder" shall mean any holder, as registered on the books and
records of the Issuer of any Preferred Securities; provided,
however, that, in determining whether the holders of the
requisite percentage of Preferred Securities have given any
request, notice, consent or waiver hereunder, "Holder" shall not
include the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Preferred Guarantee Trustee, any
Affiliate of the Preferred Guarantee Trustee, or any officers,
directors, shareholders, members, partners, employees, represen-
tatives or agents of the Preferred Guarantee Trustee.
"Indenture" means the Indenture dated as of ___________, 1995,
among the Guarantor (the "Debenture Issuer") and The Chase
Manhattan Bank, N. A., as trustee and any indenture supplemental
thereto pursuant to which certain subordinated debt securities of
the Debenture Issuer are to be issued to the Property Trustee of
the Issuer.
"Majority in liquidation amount of the Securities" means, except
as provided by the Trust Indenture Act, a vote by Holder(s) of
Preferred Securities, voting separately as a class, of more than
50% of the liquidation amount (including the stated amount that
would be paid on redemption, liquidation or otherwise, plus
accrued and unpaid Distributions to the date upon which the
voting percentages are determined) of all Preferred Securities.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person.
Any Officers' Certificate delivered with respect to compliance
with a condition or covenant provided for in this Guarantee
Agreement shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the
definition relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer
in rendering the Officers' Certificate;
(c) a statement that each such officer has made such
examination or investigation as, in such officer's
opinion, is necessary to enable such officer to express
an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied
with.
"Person" means a legal person, including any individual, corpora-
tion, estate, partnership, joint venture, association, joint
stock company, limited liability company, trust, unincorporated
association, or government or any agency or political subdivision
thereof, or any other entity of whatever nature.
"Preferred Guarantee Trustee" means Wilmington Trust Company
until a Successor Preferred Guarantee Trustee has been appointed
and has accepted such appointment pursuant to the terms of this
Guarantee Agreement and thereafter means each such Successor Pre-
ferred Guarantee Trustee.
"Responsible Officer" means, with respect to the Preferred Guar-
antee Trustee, any vice-president, any assistant vice-president,
the secretary, any assistant secretary, the treasurer, any
assistant treasurer, any trust officer or assistant trust officer
or any other officer of the Corporate Trust Department of the
Preferred Guarantee Trustee customarily performing functions
similar to those performed by any of the above designated officers
and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because
of that officer's knowledge of and familiarity with the particular
subject.
"Successor Preferred Guarantee Trustee" means a successor Pre-
ferred Guarantee Trustee possessing the qualifications to act
as Preferred Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1. Trust Indenture Act; Application.
(a) This Guarantee Agreement is subject to the provisions
of the Trust Indenture Act that are required to be part
of this Guarantee Agreement and shall, to the extent
applicable, be governed by such provisions; and
(b) if and to the extent that any provision of this Guaran-
tee Agreement limits, qualifies or conflicts with the
duties imposed by Section 310 to 317, inclusive, of the
Trust Indenture Act, such imposed duties shall control;
SECTION 2.2. Lists of Holders of Securities.
(a) The Guarantor shall provide the Preferred Guarantee
Trustee with a list, in such form as the Preferred
Guarantee Trustee may reasonably require, of the names
and addresses of the Holders of the Preferred Securi-
ties ("List of Holders") as of such date, (i) within 14
days after January 1 and June 30 of each year, and (ii)
at any other time within 30 days of receipt by the
Guarantor of a written request for a List of Holders as
of a date no more than 14 days before such List of
Holders is given to the Preferred Guarantee Trustee
provided that the Guarantor shall not be obligated to
provide such List of Holders at any time the List of
Holders does not differ from the most recent List of
Holders given to the Preferred Guarantee Trustee by the
Guarantor. The Preferred Guarantee Trustee may destroy
any List of Holders previously given to it on receipt
of a new List of Holders.
(b) The Preferred Guarantee Trustee shall comply with its
obligations under Section 311(a), 311(b) and Section
312(b) of the Trust Indenture Act.
SECTION 2.3. Reports by the Preferred Guarantee Trustee.
Within 60 days after May 15 of each year, the Preferred Guarantee
Trustee shall provide to the Holders of the Preferred Securities
such reports as are required by Section 313 of the Trust Inden-
ture Act, if any, in the form and in the manner provided by Sec-
tion 313 of the Trust Indenture Act. The Preferred Guarantee
Trustee shall also comply with the requirements of Section 313(d)
of the Trust Indenture Act.
SECTION 2.4. Periodic Reports to Preferred Guarantee Trustee.
The Guarantor shall provide to the Preferred Guarantee Trustee
such documents, reports and information as required by Section
314 (if any) and the compliance certificate required by Section
314 of the Trust Indenture Act in the form, in the manner and at
the times required by Section 314 of the Trust Indenture Act.
SECTION 2.5. Evidence of Compliance with Conditions Precedent.
The Guarantor shall provide to the Preferred Guarantee Trustee
such evidence of compliance with any conditions precedent, if
any, provided for in this Guarantee Agreement that relate to any
of the matters set forth in Section 314(c) of the Trust Indenture
Act. Any certificate or opinion required to be given by an
officer pursuant to Section 314(c)(1) may be given in the form of
an Officers' Certificate.
SECTION 2.6. Events of Default; Waiver.
The Holders of a Majority in liquidation amount of Preferred
Securities may, by vote, on behalf of the Holders of all of the
Preferred Securities, waive any past Event of Default and its
consequences. Upon such waiver, any such Event of Default shall
cease to exist, and any Event of Default arising therefrom shall
be deemed to have been cured, for every purpose of this Guarantee
Agreement, but no such waiver shall extend to any subsequent or
other default or Event of Default or impair any right consequent
thereon.
SECTION 2.7. Event of Default; Notice
(a) The Preferred Guarantee Trustee shall, within 90 days
after the occurrence of an Event of Default, transmit by mail,
first class postage prepaid, to the Holders of the Preferred
Securities, notices of all Events of Default known to the
Preferred Guarantee Trustee, unless such defaults have been cured
before the giving of such notice, provided, that, the Preferred
________ ____
Guarantee Trustee shall be protected in withholding such notice
if and so long as the board of directors, the executive com-
mittee, or a trust committee of directors and/or Responsible
Officers of the Preferred Guarantee Trustee in good faith deter-
mines that the withholding of such notice is in the interests of
the Holders of the Preferred Securities.
(b) The Preferred Guarantee Trustee shall not be deemed to
have knowledge of any Event of Default unless the Preferred Guar-
antee Trustee shall have received written notice, or a Responsi-
ble Officer charged with the administration of the Declaration
shall have obtained written notice, of such Event of Default.
SECTION 2.8 Conflicting Interests
The Declaration shall be deemed to be specifically described in
this Guarantee Agreement for the purposes of clause (i) of the
first proviso contained in Section 310(b) of the Trust Indenture
Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE
SECTION 3.1. Powers and Duties of the Preferred Guarantee
Trustee.
(a) This Guarantee Agreement shall be held by the Preferred
Guarantee Trustee for the benefit of the Holders of the
Preferred Securities, and the Preferred Guarantee
Trustee shall not transfer this Guarantee Agreement to
any Person except a Holder of Preferred Securities
exercising his or her rights pursuant to Section 5.4(b)
or to a Successor Preferred Guarantee Trustee on
acceptance by such Successor Preferred Guarantee
Trustee of its appointment to act as Successor Pre-
Preferred Guarantee Trustee. The right, title and
interest of the Preferred Guarantee Trustee shall auto-
matically vest in any Successor Preferred Guarantee
Trustee, and such vesting and cessation of title shall
be effective whether or not conveyancing documents have
been executed and delivered pursuant to the appointment
of such Successor Preferred Guarantee Trustee.
(b) If an Event of Default has occurred and is continuing,
the Preferred Guarantee Trustee shall enforce this
Guarantee Agreement for the benefit of the Holders of
the Preferred Securities.
(c) The Preferred Guarantee Trustee, before the occurrence
of any Event of Default and after the curing of all
Events of Default that may have occurred, shall under-
undertake to perform only such duties as are specifi-
cally set forth in this Guarantee Agreement, and no im-
plied covenants shall be read into this Guarantee
Agreement against the Preferred Guarantee Trustee. In
case an Event of Default has occurred (that has not
been cured or waived pursuant to Section 2.6), the
Preferred Guarantee Trustee shall exercise such of the
rights and powers vested in it by this Guarantee Agree-
ment, and use the same degree of care and skill in its
exercise thereof, as a prudent person would exercise or
use under the circumstances in the conduct of his or
her own affairs.
(d) No provision of this Guarantee Agreement shall be con-
strued to relieve the Preferred Guarantee Trustee from
liability for its own negligent action, its own negli-
negligent failure to act, or its own willful miscon-
duct, except that:
(i) prior to the occurrence of any Event of Default
and after the curing or waiving of all such
Events of Default that may have occurred:
(A) the duties and obligations of the Preferred
Guarantee Trustee shall be determined solely
by the express provisions of this Guarantee
Agreement, and the Preferred Guarantee
Trustee shall not be liable except for the
performance of such duties and obligations
as are specifically set forth in this Guar-
antee Agreement, and no implied covenants or
obligations shall be read into this Guaran-
tee Agreement against the Preferred Guaran-
tee Trustee; and
(B) in the absence of bad faith on the part of
the Preferred Guarantee Trustee, the Pre-
ferred Guarantee Trustee may conclusively
rely, as to the truth of the statements and
the correctness of the opinions expressed
therein, upon any certificates or opinions
furnished to the Preferred Guarantee Trustee
and conforming to the requirements of this
Guarantee Agreement; but in the case of any
such certificates or opinions that by any
provision hereof are specifically required
to be furnished to the Preferred Guarantee
Trustee, the Preferred Guarantee Trustee
shall be under a duty to examine the same to
determine whether or not they conform to the
requirements of this Declaration;
(ii) the Preferred Guaranty Trustee shall not be
liable for any error of judgment made in good
faith by a Responsible Officer of the Preferred
Guarantee Trustee, unless it shall be proved that
the Preferred Guarantee Trustee was negligent in
ascertaining the pertinent facts upon which such
judgment was made;
(iii) the Preferred Guarantee Trustee shall not be
liable with respect to any action taken or
omitted to be taken by it in good faith in
accordance with the direction of the Holders
of not less than a Majority in liquidation amount
of the Preferred Securities relating to the time,
method and place of conducting any proceeding for
any remedy available to the Preferred Guarantee
Trustee, or exercising any trust or power con-
ferred upon the Preferred Guarantee Trustee under
this Guarantee Agreement; and
(iv) no provision of this Guarantee Agreement shall
require the Preferred Guarantee Trustee to expend
or risk its own funds or otherwise incur personal
financial liability in the performance of any of
its duties or in the exercise of any of its
rights or powers, if the Preferred Guarantee
Trustee shall have reasonable grounds for be-
lieving that the repayment of such funds or lia-
bility is not reasonably assured to it under the
terms of this Guarantee Agreement or adequate in-
demnity against such risk or liability is not
reasonably assured to it.
SECTION 3.2. Certain Rights of Preferred Guarantee Trustee.
(a) Subject to the provisions of Section 3.1:
(i) The Preferred Guarantee Trustee may rely and
shall be fully protected in acting or refraining
from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, deben-
ture, note, other evidence of indebtedness or
other paper or document believed by it to be
genuine and to have been signed, sent or pre-
sented by the proper party or parties.
(ii) Any direction or act of the Guarantor contem-
plated by this Guarantee Agreement shall be suf-
ficiently evidenced by a Direction or an
Officers' Certificate.
(iii) Whenever, in the administration of this Guaran-
tee Agreement, the Preferred Guarantee Trustee
shall deem it desirable that a matter be proved
or established before taking, suffering or
omitting any action hereunder, the Preferred
Guarantee Trustee (unless other evidence is
herein specifically prescribed) may, in the ab-
sence of bad faith on its part, request and rely
upon an Officers' Certificate which, upon
receipt of such request, shall be promptly de-
livered by the Guarantor.
(iv) The Preferred Guarantee Trustee shall have no
duty to see to any recording, filing or regis-
tration of any instrument (or any rerecording,
refiling or registration thereof).
(v) The Preferred Guarantee Trustee may consult with
counsel, and the written advice or opinion of
such counsel with respect to legal matters shall
be full and complete authorization and protec-
tion in respect of any action taken, suffered or
omitted by it hereunder in good faith and in
accordance with such advice or opinion. Such
counsel may be counsel to the Guarantor or any
of its Affiliates and may include any of its
employees. The Preferred Guarantee Trustee
shall have the right at any time to seek
instructions concerning the administration of
this Guarantee Agreement from any court of com-
petent jurisdiction.
(vi) The Preferred Guarantee Trustee shall be under
no obligation to exercise any of the rights or
powers vested in it by this Guarantee Agreement
at the request or direction of any Holder, un-
less such Holder shall have provided to the Pre-
ferred Guarantee Trustee such adequate security
and indemnity as would satisfy a reasonable per-
son in the position of the Preferred Guarantee
Trustee, against the costs, expenses (including
attorneys' fees and expenses) and liabilities
that might be incurred by it in complying with
such request or direction, including such rea-
sonable advances as may be requested by the Pre-
ferred Guarantee Trustee; provided that, nothing
contained in this Section 3.2(a)(vi) shall be
taken to relieve the Preferred Guarantee
Trustee, upon the occurrence of an Event of
Default, of its obligation to exercise the
rights and powers vested in it by this Guarantee
Agreement.
(vii) The Preferred Guarantee Trustee shall not be
bound to make any investigation into the facts
or matters stated in any resolution, certifi-
cate, statement, instrument, opinion, report,
notice, request, direction, consent, order,
bond, debenture, note, other evidence of
indebtedness or other paper or document, but the
Preferred Guarantee Trustee, in its discretion,
may make such further inquiry or investigation
into such facts or matters as it may see fit.
(viii) The Preferred Guarantee Trustee may execute any
of the trusts or powers hereunder or perform any
duties hereunder either directly or by or
through agents or attorneys, and the Preferred
Guarantee Trustee shall not be responsible for
any misconduct or negligence on the part of any
agent or attorney appointed with due care by it
hereunder.
(ix) Any action taken by the Preferred Guarantee
Trustee or its agents hereunder shall bind the
Holders of the Preferred Securities, and the
signature of the Preferred Guarantee Trustee or
its agents alone shall be sufficient and effec-
tive to perform any such action. No third party
shall be required to inquire as to the authority
of the Preferred Guarantee Trustee to so act or
as to its compliance with any of the terms and
provisions of this Guarantee Agreement, both of
which shall be conclusively evidenced by the
Preferred Guarantee Trustee's or its agent's
taking such action.
(x) Whenever in the administration of this Guarantee
Agreement the Preferred Guarantee Trustee shall
deem it desirable to receive instructions with
respect to enforcing any remedy or right or
taking any other action hereunder, the Preferred
Guarantee Trustee (i) may request instructions
from the Holders of the Preferred Securities,
(ii) may refrain from enforcing such remedy or
right or taking such other action until such
instructions are received, and (iii) shall be
protected in acting in accordance with such in-
structions.
(b) No provision of this Guarantee Agreement shall be
deemed to impose any duty or obligation on the Pre-
ferred Guarantee Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred
or imposed on it in any jurisdiction in which it shall
be illegal, or in which the Preferred Guarantee Trustee
shall be unqualified or incompetent in accordance with
applicable law, to perform any such act or acts or to
exercise any such right, power, duty or obligation. No
permissive power or authority available to the Pre-
ferred Guarantee Trustee shall be construed to be a
duty.
SECTION 3.3. Not Responsible for Recitals or Issuance of
Guarantee.
The recitals contained in this Guarantee shall be taken as the
statements of the Guarantor, and the Preferred Guarantee Trustee
does not assume any responsibility for their correctness. The
Preferred Guarantee Trustee makes no representation as to the
validity or sufficiency of this Guarantee Agreement.
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
SECTION 4.1. Preferred Guarantee Trustee; Eligibility.
(a) There shall at all times be a Preferred Guarantee
Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business
under the laws of the United States of America or
any State or Territory thereof or of the District
of Columbia, or a corporation or Person permitted
by the Securities and Exchange Commission to act
as an institutional trustee under the Trust Inden-
ture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital
and surplus of at least 50 million U.S. dollars
($50,000,000), and subject to supervision or
examination by Federal, State, Territorial or
District of Columbia authority. If such corpora-
tion publishes reports of condition at least
annually, pursuant to law or to the requirements
of the supervising or examining authority referred
to above, then, for the purposes of this Section
4.1(a)(ii), the combined capital and surplus of
such corporation shall be deemed to be its com-
bined capital and surplus as set forth in its most
recent report of condition so published.
(b) If at any time the Preferred Guarantee Trustee shall
cease to be eligible to so act under Section 4.1(a),
the Preferred Guarantee Trustee shall immediately
resign in the manner and with the effect set out in
Section 4.2(c).
(c) If the Preferred Guarantee Trustee has or shall acquire
any "conflicting interest" within the meaning of Sec-
tion 310(b) of the Trust Indenture Act, the Preferred
Guarantee Trustee and Guarantor shall in all respects
comply with the provisions of Section 310(b) of the
Trust Indenture Act.
SECTION 4.2. Appointment, Removal and Resignation of Preferred
Guarantee Trustees.
(a) Subject to Section 4.2(b), the Preferred Guarantee
Trustee may be appointed or removed without cause at
any time by the Guarantor.
(b) The Preferred Guarantee Trustee shall not be removed
in accordance with Section 4.2(b) until a Successor
Preferred Guarantee Trustee has been appointed and has
accepted such appointment by written instrument exe-
cuted by such Successor Preferred Guarantee Trustee and
delivered to the Guarantor.
(c) The Preferred Guarantee Trustee appointed to office
shall hold office until a Successor Preferred Guarantee
Trustee shall have been appointed or until its removal
or resignation. The Preferred Guarantee Trustee may
resign from office (without need for prior or subse-
quent accounting) by an instrument in writing executed
by the Preferred Guarantee Trustee and delivered to the
Guarantor, which resignation shall not take effect
until a Successor Preferred Guarantee Trustee has been
appointed and has accepted such appointment by instru-
ment in writing executed by such Successor Preferred
Guarantee Trustee and delivered to the Guarantor and
the resigning Preferred Guarantee Trustee.
(d) If no Successor Preferred Guarantee Trustee shall have
been appointed and accepted appointment as provided in
this Section 4.2 within 60 days after delivery to the
Guarantor of an instrument of resignation, the
resigning Preferred Guarantee Trustee may petition any
court of competent jurisdiction for appointment of a
Successor Preferred Guarantee Trustee. Such court may
thereupon, after prescribing such notice, if any, as it
may deem proper, appoint a Successor Preferred Guaran-
tee Trustee.
ARTICLE V
GUARANTEE
SECTION 5.1. Guarantee.
The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Payments (without duplication
of amounts theretofore paid by the Issuer), as and when due,
regardless of any defense, right of set-off or counterclaim that
the Issuer may have or assert. The Guarantor's obligation to
make a Guarantee Payment may be satisfied by direct payment of
the required amounts by the Guarantor to the Holders or by
causing the Issuer to pay such amounts to the Holders.
SECTION 5.2. Waiver of Notice and Demand.
The Guarantor hereby waives notice of acceptance of this
Guarantee Agreement and of any liability to which it applies or
may apply, presentment, demand for payment, any right to require
a proceeding first against the Issuer or any other Person before
proceeding against the Guarantor, protest, notice of nonpayment,
notice of dishonor, notice of redemption and all other notices
and demands.
SECTION 5.3. Obligations Not Affected
The obligations, covenants, agreements and duties of the
Guarantor under this Guarantee Agreement shall in no way be
affected or impaired by reason of the happening from time to time
of any of the following:
(a) the release or waiver, by operation of law or other-
wise, of the performance or observance by the Issuer of
any express or implied agreement, covenant, term or
condition relating to the Preferred Securities to be
performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer
of all or any portion of the Distributions, Redemption
Price, Liquidation Distribution or any other sums
payable under the terms of the Preferred Securities or
the extension of time for the performance of any other
obligation under, arising out of, or in connection
with, the Preferred Securities (other than an extension
of time for payment of Distributions, Redemption Price,
Liquidation Distribution or other sum payable that re-
sults from the extension of any interest payment period
on the Debentures or any extension of the maturity date
of the Debentures permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence on
the part of the Holders to enforce, assert or exercise
any right, privilege, power or remedy conferred on the
Holders pursuant to the terms of the Preferred Securi-
ties, or any action on the part of the Issuer granting
indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bank-
ruptcy, assignment for the benefit of creditors, reor-
ganization, arrangement, composition or readjustment of
debt of, or other similar proceedings affecting, the
Issuer or any of the assets of the Issuer;
(e) any invalidity of, or defect or deficiency in the Pre-
ferred Securities;
(f) the settlement or compromise of any obligation guaran-
teed hereby or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of
a guarantor, it being the intent of this Section 2.3
that the obligations of the Guarantor hereunder shall
be absolute and unconditional under any and all circum-
stances.
There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of
any of the foregoing.
SECTION 5.4. Rights of Holders.
(a) The Holders of a Majority in liquidation amount of the
Preferred Securities have the right to direct the time,
method and place of conducting of any proceeding for
any remedy available to the Preferred Guarantee Trustee
in respect of this Guarantee Agreement or exercising
any trust or power conferred upon the Preferred Guaran-
tee Trustee under this Guarantee Agreement.
(b) If the Preferred Guarantee Trustee fails to enforce
this Guarantee Agreement, any Holder of Preferred
Securities may, after a period of 30 days has elapsed
from such Holder's written request to the Preferred
Guarantee Trustee to enforce this Guarantee Agreement,
institute a legal proceeding directly against the Guar-
antor to enforce its rights under this Guarantee Agree-
ment, without first instituting a legal proceeding
against the Issuer, the Preferred Guarantee Trustee or
any other Person.
SECTION 5.5. Guarantee of Payment.
This Guarantee Agreement creates a guarantee of payment and not
of collection.
SECTION 5.6. Subrogation.
The Guarantor shall be subrogated to all (if any) rights of the
Holders of Preferred Securities against the Issuer in respect of
any amounts paid to such Holders by the Guarantor under this
Guarantee Agreement; provided, however, that the Guarantor shall
________ _______
not (except to the extent required by mandatory provisions of
law) be entitled to enforce or exercise any right that it may
acquire by way of subrogation or any indemnity, reimbursement or
other agreement, in all cases as a result of payment under this
Guarantee Agreement, if, at the time of any such payment, any
amounts are due and unpaid under this Guarantee Agreement. If
any amount shall be paid to the Guarantor in violation of the
preceding sentence, the Guarantor agrees to hold such amount in
trust for the Holders and to pay over such amount to the Holders.
SECTION 5.7. Independent Obligations.
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the
Preferred Securities, and that the Guarantor shall be liable as
principal and as debtor hereunder to make Guarantee Payments
pursuant to the terms of this Guarantee Agreement notwithstanding
the occurrence of any event referred to in subsections (a)
through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1. Limitation of Transactions.
So long as any Preferred Securities remain outstanding, if there
shall have occurred an Event of Default or an Event of Default
under the Declaration, then (a) the Guarantor shall not, and shall
cause any subsidiary of the Guarantor not to, declare or pay any
dividend on, or make any distribution with respect to, or redeem,
purchase, acquire or make any distribution with respect to, any of
its capital stock or the capital stock of any such subsidiary, and
(b) the Guarantor shall not make any payment of interest, principal
or premium, if any, on or repay, repurchase or redeem any debt
securities issued by the Guarantor which rank pari passu with or
junior to the Debentures, provided, that, the foregoing restriction
in this Section 6.1 (a) shall not apply to any stock dividends paid
by Southern Union, or any of its subsidiaries, where the dividend
stock is the same stock as that on which the dividend is being
paid.
SECTION 6.2. Ranking.
This Guarantee Agreement will constitute an unsecured obligation
of the Guarantor and will rank (i) subordinate and junior in
right of payment to all other liabilities of the Guarantor, (ii)
pari passu with the most senior preferred or preference stock now
or hereafter issued by the Guarantor and with any guarantee now
or hereafter entered into by the Guarantor in respect of any
preferred or preference stock of any Affiliate of the Guarantor,
and (iii) senior to the Guarantor's common stock.
ARTICLE VII
TERMINATION
SECTION 7.1. Termination.
This Guarantee Agreement shall terminate upon (i) full payment of
the Redemption Price of all Securities, (ii) upon the distribu-
tion of the Debentures to the Holder's of all of the Preferred
Securities or (iii) upon full payment of the amounts payable in
accordance with the Declaration upon liquidation of the Issuer.
Notwithstanding the foregoing, this Guarantee Agreement will
continue to be effective or will be reinstated, as the case may
be, if at any time any Holder of Preferred Securities must
restore payment of any sums paid under the Preferred Securities
or under this Preferred Securities Guarantee.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1. Exculpation.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Guarantor or any
Covered Person for any loss, damage or claim incurred by reason
of any act or omission performed or omitted by such Indemnified
Person in good faith in accordance with this Guarantee Agreement
and in a manner that such Indemnified Person reasonably believed
to be within the scope of the authority conferred on such
Indemnified Person by this Guarantee Agreement or by law, except
that an Indemnified Person shall be liable for any such loss,
damage or claim incurred by reason of such Indemnified Person's
negligence or willful misconduct with respect to such acts or
omissions.
(b) An Indemnified Person shall be fully protected in
relying in good faith upon the records of the Guarantor and upon
such information, opinions, reports or statements presented to
the Guarantor by any Person as to matters the Indemnified Person
reasonably believes are within such other Person's professional
or expert competence and who has been selected with reasonable
care by or on behalf of the Guarantor, including information,
opinions, reports or statements as to the value and amount of the
assets, liabilities, profits, losses, or any other facts perti-
nent to the existence and amount of assets from which Distribu-
tions to Holders of Preferred Securities might properly be paid.
SECTION 8.2. Indemnification.
(a) To the fullest extent permitted by applicable law, the
Guarantor shall indemnify and hold harmless each
Indemnified Person from and against any loss, damage or
claim incurred by such Indemnified Person by reason of
any act or omission performed or omitted by such
Indemnified Person in good faith in accordance with
this Guarantee Agreement and in a manner such Indemni-
fied Person reasonably believed to be within the scope
of authority conferred on such Indemnified Person by
this in accordance with this Guarantee Agreement,
except that no Indemnified Person shall be entitled to
be indemnified in respect of any loss, damage or claim
incurred by such Indemnified Person by reason of negli-
gence or willful misconduct with respect to such acts
or omissions.
(b) To the fullest extent permitted by applicable law,
expenses (including legal fees) incurred by an Indemni-
fied Person in defending any claim, demand, action,
suit or proceeding shall, from time to time, be
advanced by the Guarantor prior to the final disposi-
tion of such claim, demand, action, suit or proceeding
upon receipt by the Guarantor of an undertaking by or
on behalf of the Indemnified Person to repay such
amount if it shall be determined that the Indemnified
Person is not entitled to be indemnified as authorized
in Section 8.2(a).
ARTICLE IX
MISCELLANEOUS
SECTION 9.1. Successors and Assigns.
All guarantees and agreements contained in this Guarantee
Agreement shall bind the successors, assigns, receivers, trustees
and representatives of the Guarantor and shall inure to the bene-
fit of the Holders of the Preferred Securities then outstanding.
SECTION 9.2. Amendments.
Except with respect to any changes that do not adversely affect
the rights of Holders (in which case no consent of Holders will
be required), this Guarantee Agreement may only be amended with
the prior approval of the Holders of at least 66-2/3% in liquida-
tion amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accrued and unpaid
Distributions to the date upon which the voting percentages are
determined) of all the outstanding Preferred Securities. The
provisions of Section 12.2 of the Declaration with respect to
meetings of Holders of the Securities apply to the giving of such
approval.
SECTION 9.3. Notices.
All notices provided for in this Guarantee Agreement shall be in
writing, duly signed by the party giving such notice, and shall
be delivered, telecopied or mailed by registered or certified
mail, as follows:
(a) If given to the Preferred Guarantee Trustee, at the
Preferred Guarantee Trustee's mailing address set forth
below (or such other address as the Preferred Guarantee
Trustee may give notice of to the Holders of the Pre-
ferred Securities):
Wilmington Trust Company
1100 N. Market Street
Wilmington, Delaware 19890
(b) If given to the Guarantor, at the Guarantor's mailing
address set forth below (or such other address as the
Guarantor may give notice of to the Holders of the Pre-
ferred Securities):
Southern Union Company
504 Lavaca Street, Suite 800
Austin, Texas 78701
(c) If given to any Holder of Preferred Securities, at the
address set forth on the books and records of the
Issuer.
All such notices shall be deemed to have been given when received
in person, telecopied with receipt confirmed, or mailed by first
class mail, postage prepaid except that if a notice or other
document is refused delivery or cannot be delivered because of a
changed address of which no notice was given, such notice or
other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 9.4. Benefit.
This Guarantee Agreement is solely for the benefit of the Holders
of the Preferred Securities and, subject to Section 3.1(a), is
not separately transferable from the Preferred Securities.
SECTION 9.5. Governing Law.
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
<PAGE>
THIS GUARANTEE AGREEMENT is executed as of the day and year first
above written.
Southern Union Company
By:_________________________
Name:
Title:
Wilmington Trust Company
as Preferred Guarantee Trustee
By:__________________________
Name:
Title:
<PAGE>
EXHIBIT 5
OPINION OF FLEISCHMAN AND WALSH, L.L.P.
<PAGE>
FLEISCHMAN AND WALSH, L.L.P.
1400 Sixteenth Street, N.W.
Sixth Floor
Washington, DC 20036
(202) 939-7900
May 5, 1995
Southern Union Company
504 Lavaca Street, Suite 800
Austin, Texas 78701
Dear Ladies and Gentlemen:
We have acted as counsel to Southern Union Company, a Delaware
corporation (the "Company"), and Southern Union Financing I,
Southern Union Financing II and Southern Union Financing III,
each a Delaware statutory business trust sponsored by the Company
(each, a "Trust" and, collectively, the "Trusts"), in connection
with the preparation and filing with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933,
as amended (the "Act"), of a Registration Statement on Form S-3
(the "Registration Statement"), relating to the proposed
issuance and sale of debt securities (the "Debt Securities"),
from time to time, by the Company, and the proposed issuance
and sale of Trust Originated Preferred Securities[SM] (the
"Preferred Securities"), from time to time, by the Trusts
(Commission File No. 033-58297). In addition, the Company will
guarantee the Preferred Securities to the extent set forth in one
or more guarantee agreements (each, a "Guarantee" and,
collectively, the "Guarantees") substantially similar to the form
of Guarantee (the "Form of Guarantee") that is part of the
Registration Statement as Exhibit 4-K thereto. Each Guarantee
shall apply exclusively to the Preferred Securities issued by a
single Trust, as described in the prospectus (the "Prospectus") and
the prospectus supplement (the "Supplement") that form a part
of the Registration Statement, which also relates to the
issuance of the Guarantees. (Initially capitalized terms that
are used but not defined herein shall have the meanings
ascribed to them in the Prospectus and the Supplement.)
Debt Securities may be issued either as Senior Debt Securities
pursuant to the Senior Debt Securities Indenture or as Subordinated
Debt Securities pursuant to an Indenture that is substantially
similar to the form of the Subordinated Debt Securities Indenture
(the "Form of Indenture"), which is part of the Registration
Statement as Exhibit 4-G thereto, that is to be executed by The
Chase Manhattan Bank, N.A., as trustee, and the Company. Preferred
Securities may be issued by each Trust pursuant to its Declaration,
which shall be substantially similar to the form of the Declaration
of Southern Union Financing I (the "Form of Declaration"), that is
part of the Registration Statement as Exhibit 4-D thereto. The
Company and the Guarantee Trustee will execute and deliver to the
Property Trustee of each Trust issuing Preferred Securities a
Guarantee prior to and with respect to the issuance by such Trust
of such Preferred Securities, and the Property Trustee will hold
the Guarantee for the benefit of the holders of Preferred
Securities of such Trust.
As counsel to the Company and the Trusts, we have examined: (i)
the Registration Statement and exhibits thereto, including the
Prospectus, the Supplement, the Form of Indenture, the certificate
of trust of each Trust, the initial declaration of trust of each
Trust, dated as of March 28, 1995, the Form of Declaration, the
Form of Guarantee, the Senior Debt Securities Indenture and the
form of the Underwriting Agreement; (ii) the Company's Restated
Certificate of Incorporation and Bylaws; (iii) pertinent
resolutions adopted by the Company's Board of Directors and the
Executive Committee thereof; (iv) certificates of public officials,
the Company's officers and the Trusts' trustees; and (v) such other
documents and records of the Company and the Trusts, and such
matters of law, as we have considered necessary for the purpose of
rendering this opinion. In our examinations of documents submitted
to us, we have assumed (i) the genuineness of all such documents as
originals and the conformity to original and certified documents of
all copies submitted to us as conformed or photocopied copies
thereof, (ii) the genuineness of all signatures thereon, (iii) the
power and authority of all signatories thereto and (iv) the due
execution and delivery thereof by all parties thereto. As to the
various questions of fact material to our opinion, we have relied
upon representations, statements or certificates of officers and
representatives of the Company, trustees of the Trusts and other
persons with responsibility for such matters.
Based upon and subject to the foregoing, we are of the following
opinions:
1. The Company has been duly incorporated and is validly existing
in good standing under the laws of the State of Delaware.
2. Each of the Trusts has been duly created and is validly
existing in good standing as a statutory business trust under
the laws of the State of Delaware.
3. The Senior Debt Securities Indenture has been duly and validly
authorized, executed and delivered by the Company.
4. Subject to the final approval of the forms and terms thereof
by the Board (directly or by action of the Executive Committee
thereof), the Company has duly and validly authorized the
execution and delivery of the Subordinated Debt Securities
Indenture, the Guarantees and the Declarations of the Trusts.
5. Senior Debt Securities issued pursuant to the Registration
Statement will constitute valid and binding obligations of the
Company, assuming that their issuance, any applicable
supplemental indenture or officer's certificate with respect
to the Senior Debt Securities Indenture, and the issuance of
such Senior Debt Securities have been duly authorized by the
Company, when (a) the Registration Statement and the
applicable prospectus supplement thereto have become effective
under the Act, (b) any necessary supplemental indenture or
officer's certificate with respect to the Senior Debt
Securities Indenture has been duly executed and delivered by
the Company and the Senior Debt Securities Trustee, (c) the
terms of such Senior Debt Securities have been duly
established in accordance with the Senior Debt Securities
Indenture and any applicable supplemental indenture or
officer's certificate with respect thereto, (d) such Senior
Debt Securities have been duly executed and authenticated in
accordance with the Senior Debt Securities Indenture and any
applicable supplemental indenture or officer's certificate
with respect thereto and (e) such Senior Debt Securities have
been issued and delivered in accordance with the Registration
Statement and the applicable prospectus supplement thereto.
Subject to the foregoing, such Senior Debt Securities will be
enforceable in accordance with their terms against the
Company, except as (x) the enforceability thereof may be
limited by bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium or other similar laws now or hereafter in
effect relating to or affecting the enforcement of creditors'
rights generally and (y) the availability of equitable
remedies may be limited by equitable principles of general
applicability (regardless of whether considered in a
proceeding at law or in equity).
6. Subordinated Debt Securities issued pursuant to the Registra-
tion Statement will, subject to paragraph 4 above, constitute
valid and binding obligations of the Company, assuming that
the Subordinated Debt Securities Indenture, any applicable
supplemental indenture or officer's certificate with respect
thereto, and the issuance of such Subordinated Debt Securities
have been duly authorized by the Company, when (a) the Regis-
tration Statement and the applicable prospectus supplement
thereto have become effective under the Act, (b) the Subordi-
nated Debt Securities Indenture and any necessary supplemental
indenture or officer's certificate with respect thereto have
been duly executed and delivered by the Company and the
Subordinated Debt Securities Trustee, (c) the terms of such
Subordinated Debt Securities have been duly established in
accordance with the Subordinated Debt Securities Indenture and
any applicable supplemental indenture or officer's certificate
with respect thereto, (d) such Subordinated Debt Securities
have been duly executed and authenticated in accordance with
the Subordinated Debt Securities Indenture and any applicable
supplemental indenture or officer's certificate with respect
thereto and (e) such Subordinated Debt Securities have been
issued and delivered as contemplated by the Registration
Statement and the applicable prospectus supplement thereto.
Subject to the foregoing, such Subordinated Debt Securities
will be enforceable in accordance with their terms against the
Company, except as (x) the enforceability thereof may be
limited by bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium or other similar laws now or hereafter in
effect relating to or affecting the enforcement of creditors'
rights generally and (y) the availability of equitable
remedies may be limited by equitable principles of general
applicability (regardless of whether considered in a pro-
ceeding at law or in equity).
7. The Preferred Securities of a Trust will, subject to paragraph
4 above, represent valid and, subject to paragraph 8 below,
fully paid and nonassessable undivided beneficial interests in
the assets of such Trust when (a) the Registration Statement
and the applicable prospectus supplement thereto have become
effective under the Act, (b) the Declaration of such Trust has
been duly executed by the Trust's trustees and by the Company
as such Trust's sponsor, (c) the Guarantee applicable to such
Preferred Securities has been duly executed and delivered to
the Property Trustee of such Trust by the Company and the
Guarantee Trustee of such Guarantee as contemplated in para-
graph 9 below, (d) such Preferred Securities have been issued
in accordance with the terms and provisions of the Declaration
of such Trust and (e) such Preferred Securities have been
issued and delivered as contemplated by the Registration
Statement and the applicable prospectus supplement thereto.
8. Holders of Preferred Securities validly issued by a Trust, as
beneficial owners of such Trust, will be entitled to the same
limitation of personal liability extended to stockholders of
private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note, however,
that holders of Preferred Securities may be obligated,
pursuant to and to the extent provided for in the Declaration,
to (a) provide indemnity and security in connection with and
pay taxes or governmental charges arising from transfers of
Preferred Security certificates and the issuance of replace-
ment Preferred Security certificates, (b) provide security and
indemnity in connection with requests of or directions to the
Property Trustee to exercise certain rights and remedies under
the Declaration and (c) undertake as a party litigant to pay
costs in any suit for the enforcement of any right or remedy
under the Declaration or against the Property Trustee.
9. Each Guarantee issued with respect to the issuance by a Trust
of Preferred Securities will, subject to paragraph 4 above,
constitute a valid and binding obligation of the Company,
assuming that it has been duly authorized by the Company, when
(a) the Registration Statement and the applicable prospectus
supplement thereto have become effective under the Act, (b)
such Guarantee has been duly executed and delivered to the
Property Trustee of such Trust by the Company and the
Guarantee Trustee of such Guarantee, (c) such Preferred
Securities have been issued as contemplated in paragraph 7
above and (d) such Guarantee has been issued and delivered as
contemplated in the Regisrtation Statement and the applicable
prospectus supplement thereto. Subject to the foregoing, such
Guarantee will be enforceable against the Company in
accordance with its terms, except as (x) the enforceability
thereof may be limited by bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or similar
laws now or hereafter in effect relating to or affecting the
enforcement of creditors' rights generally and (y) the
availability of equitable remedies may be limited by equitable
principles of general applicability (regardless of whether
considered in a proceeding at law or in equity).
The opinions we have expressed herein are limited to the laws of
the District of Columbia, applicable federal securities laws, the
General Corporation Law of the State of Delaware and the Delaware
Business Trust Act of the State of Delaware. We assume no
responsibility as to the applicability of the laws of any other
jurisdiction to the subject transactions or the effect of such laws
thereon.
We hereby consent to the filing of this opinion as an exhibit to
the Registration Statement and to the use of our name under the
headings of "Validity of Securities" in the Prospectus and "Legal
Matters" in the Supplement. In giving such consent, we do not
thereby concede that we are within the category of persons whose
consent is required under Section 7 of the Act or the Rules and
Regulations of the Commission thereunder.
Please be advised that Aaron I. Fleischman, Senior Partner of
Fleischman and Walsh, L.L.P., is a director of the Company, and
that he, Fleischman and Walsh, L.L.P., and certain other attorneys
with Fleischman and Walsh, L.L.P., have beneficial interests in
shares of the Company's common stock.
Also, please be advised that the terms "Trust Originated Preferred
Securities" and "TOPrS" are service marks of Merrill Lynch & Co.,
Inc.
If you have any questions regarding the opinions expressed herein,
please contact Stephen A. Bouchard, a partner with this firm, at
(202) 939-7911 or Mark G. Johnston, an associate with this firm, at
(202) 939-7918.
Very truly yours,
FLEISCHMAN AND WALSH, L.L.P.
<PAGE>
EXHIBIT 8
May 8, 1995
Southern Union Company
504 Lavaca Street, Suite 800
Austin, Texas 78701
Southern Union Financing I
c/o Southern Union Company
504 Lavaca Street, Suite 800
Austin, Texas 78701
Re: Registration No. 33-58297
Registration Statement on Form S-3
Exhibit Number 8.
Ladies & Gentlemen:
We have acted as special tax counsel for
Southern Union Company, a Delaware corporation ("Southern
Union"), and Southern Union Financing I, a Delaware
business trust ("Southern Union Trust"), in connection
with the above-captioned Registration Statement on Form
S-3 filed with the Securities and Exchange Commission on
March 29, 1995, and as amended through May 8, 1995 (the
"Registration Statement"), for the purpose of registering
Trust Originated Preferred Securities (the "Preferred
Securities") of Southern Union Trust, liquidation amount
of $25 per Preferred Security, and Subordinated
Deferrable Interest Notes of Southern Union due 2025 (the
"Debentures"). In connection therewith, we have
participated in the preparation of, and have reviewed,
the Registration Statement, including the prospectus (the
"Prospectus") and the form of prospectus supplement (the
"Prospectus Supplement") included therewith.
We have examined and relied upon the
Registration Statement and, in each case as filed with
the Registration Statement, (i) the form of indenture
(the "Indenture") between Southern Union and The Chase
Manhattan Bank, N.A., as trustee, (ii) the form of
supplemental indenture to be used in connection with the
issuance of the Debentures (the "Supplemental
Indenture"), which Supplemental Indenture includes the
form of the Debentures, (iii) the form of declaration of
trust for Southern Union Trust (the "Declaration"), which
Declaration includes the form of the Preferred
Securities, (iv) the form of guarantee with respect to
the Preferred Securities, and (v) certain other relevant
documents used in connection with the issuance of the
Debentures and the Preferred Securities (collectively the
"Operative Documents").
Based on the foregoing and assuming that the
Operative Documents are executed and delivered in
substantially the form we have examined and that the
transactions contemplated to occur under the Operative
Documents in fact occur in accordance with the terms
thereof, we hereby confirm, in all material respects,
that the discussion set forth in the Prospectus
Supplement under the heading "UNITED STATES FEDERAL
INCOME TAXATION" is a fair and accurate summary of the
matters addressed therein, based upon current law and the
assumptions stated or referred to therein. There can be
no assurance that contrary positions may not be taken by
the Internal Revenue Service.
We hereby consent to the use of our name in the
above-captioned Registration Statement and to the filing
of this opinion as Exhibit 8 to the Registration
Statement. In giving such consent, we do not thereby
admit that we are in the category of persons whose
consent is required under Section 7 of the Securities Act
of 1933.
Very truly yours,
<PAGE>
EXHIBIT 25.A
Securities Act of 1933 File No. ________
(If application to determine eligibility of trustee
for delayed offering pursuant to Section 305 (b) (2))
_________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE
PURSUANT TO SECTION 305(b)(2)___________
__________________
THE CHASE MANHATTAN BANK
(National Association)
(Exact name of trustee as specified in its charter)
13-2633612
(I.R.S. Employer Identification Number)
1 Chase Manhattan Plaza, New York, New York
(Address of principal executive offices)
10081
(Zip Code)
________________
SOUTHERN UNION COMPANY
(Exact name of obligor as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
75-0571592
(I.R.S. Employer Identification No.)
504 Lavaca Street, Suite 800
Austin, Texas
(Address of principal executive offices)
78701
(Zip Code)
__________________________________
Subordinated Debt Securities
(Title of the indenture securities)
___________________________________________________________________
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising
authority to which it is subject.
Comptroller of the Currency, Washington, D.C.
Board of Governors of The Federal Reserve
System, Washington, D. C.
(b) Whether it is authorized to exercise corporate trust
powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe
each such affiliation.
The Trustee is not the obligor, nor is the Trustee
directly or indirectly controlling, controlled by, or
under common control with the obligor.
(See Note on Page 2.)
Item 16. List of Exhibits.
List below all exhibits filed as a part of this statement
of eligibility.
*1. -- A copy of the articles of association of the
trustee as now in effect. (See Exhibit T-1 (Item
12), Registration No. 33-55626.)
*2. -- Copies of the respective authorizations of The
Chase Manhattan Bank (National Association)
and The Chase Bank of New York (National
Association) to commence business and a copy of
approval of merger of said corporations, all of
which documents are still in effect. (See Exhibit
T-1 (Item 12), Registration No. 2-67437.)
*3. -- Copies of authorizations of The Chase Manhattan
Bank (National Association) to exercise corporate
trust powers, both of which documents are still in
effect. (See Exhibit T-1 (Item 12), Registration
No. 2-67437).
*4. -- A copy of the existing by-laws of the trustee.
(See Exhibit T-1 (Item 12(a)), Registration
No. 33-28806.)
*5. -- A copy of each indenture referred to in Item 4, if
the obligor is in default. (Not applicable).
*6. -- The consents of United States institutional
trustees required by Section 321(b) of the Act.
(See Exhibit T-1, (Item 12), Registration No.
22-19019.)
7. -- A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
___________________
* The Exhibits thus designated are incorporated herein by
reference. Following the description of such Exhibits is
a reference to the copy of the Exhibit heretofore filed with the
Securities and Exchange Commission, to which there have been no
amendments or changes.
NOTE
Inasmuch as this Form T-1 is filed prior to the ascertainment by
the trustee of all facts on which to base a responsive answer to
Item 2 the answer to said Item is based on incomplete information.
Item 2 may, however, be considered as correct unless amended by an
amendment to this Form T-1.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939,
the trustee, The Chase Manhattan Bank (National Association), a
corporation organized and existing under the laws of the United
States of America, has duly caused this statement of eligibility to
be signed on its behalf by the undersigned, thereunto duly
authorized, all in the City of New York, and the State of New York,
on the 26th day April, 1995.
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION)
By Timothy E. Burke
_____________________
Second Vice President
<PAGE>
Exhibit 7
REPORT OF CONDITION
Consolidating domestic and foreign subsidiaries of the
The Chase Manhattan Bank, N.A.
of New York in the State of New York, at the close of business on
December 31, 1994, published in response to call made by
Comptroller of the Currency, under title 12, United States Code,
Section 161.
Charter Number 2370 Comptroller of the Currency
Northeastern District
Statement of Resources and Liabilities
ASSETS Thousands
of Dollars
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency
and coin. . . . . . . . . . . . . . . . . . . . . $ 4,517,179
Interest-bearing balances . . . . . . . . . . . . . 7,001,642
Held to maturity securities . . . . . . . . . . . . . 1,593,325
Available-for-sale securities . . . . . . . . . . . . 4,669,255
Federal funds sold and securities purchased under
agreements to resell in domestic offices of the
bank and of its Edge and Agreement subsidiaries,
and in IBFs:
Federal funds sold. . . . . . . . . . . . . . . . 3,651,850
Securities purchased under agreements to resell 0
Loans and lease financing receivable:
Loans and leases, net of unearned income. . .$50,879,818
LESS: Allowance for loan and lease losses . . 1,073,196
LESS: Allocated transfer risk reserve. . . . 0
___________
Loans and leases, net of unearned income,
allowance, and reserve. . . . . . . . . . . . . . 49,806,622
Assets held in trading accounts . . . . . . . . . . . 13,112,807
Premises and fixed assets (including capitalized
leases) . . . . . . . . . . . . . . . . . . . . . . 1,758,500
Other real estate owned . . . . . . . . . . . . . . . 480,982
Investments in unconsolidated subsidiaries and
associated companies. . . . . . . . . . . . . . . . 55,722
Customers' liability to this bank on acceptances
outstanding . . . . . . . . . . . . . . . . . . . . 611,839
Intangible assets . . . . . . . . . . . . . . . . . . 787,948
Other assets. . . . . . . . . . . . . . . . . . . . . 6,145,452
___________
TOTAL ASSETS. . . . . . . . . . . . . . . . . . . . . $94,193.123
===========
LIABILITIES
Deposits:
In domestic offices . . . . . . . . . . . . . . . . $29,536,028
Noninterest-bearing. . . . . . . . . . . .$11,648,377
Interest-bearing . . . . . . . . . . . . . 17,887,651
___________
In foreign offices, Edge and Agreement
subsidiaries, and IBFs . . . . . . . . . . . . . 36,020,612
Noninterest-bearing. . . . . . . . . . .$ 2,320,293
Interest-bearing . . . . . . . . . . . . 33,700,319
___________
Federal funds purchased and securities sold
under agreements to repurchase in domestic
offices of the bank and of its Edge and
Agreement subsidiaries, and in IBFs:
Federal funds purchased. . . . . . . . . . . . . 1,014,936
Securities sold under agreements to repurchase . 678,033
Demand notes issued to the U.S. Treasury. . . . . . . 300,000
Trading liabilities . . . . . . . . . . . . . . . . . 8,066,477
Other borrowed money:
With original maturity of one year or less. . . . . 2,940,252
With original maturity of more than one year. . . . 427,525
Mortgage indebtedness and obligations under
capitalized leases . . . . . . . . . . . . . . . . 40,550
Bank's liability on acceptances executed and
outstanding. . . . . . . . . . . . . . . . . . . . 616,531
Subordinated notes and debentures . . . . . . . . . . 2,360,000
Other liabilities . . . . . . . . . . . . . . . . . . 5,195,890
___________
TOTAL LIABILITIES . . . . . . . . . . . . . . . . . . 87,196,834
___________
Limited-life preferred stock and related surplus. . 0
EQUITY CAPITAL
Perpetual preferred stock and related surplus . . . 0
Common stock. . . . . . . . . . . . . . . . . . . . 915,576
Surplus . . . . . . . . . . . . . . . . . . . . . . 4,656,010
Undivided profits and capital reserves. . . . . . . 1,478,713
Net unrealized holding gains (losses) on
available-for-sale securities . . . . . . . . . . (64,959)
Cumulative foreign currency translation
adjustments . . . . . . . . . . . . . . . . . . . 10,949
___________
TOTAL EQUITY CAPITAL. . . . . . . . . . . . . . . . 6,996,289
___________
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED STOCK,
AND EQUITY CAPITAL. . . . . . . . . . . . . . . . $94,193,123
I, Lester J. Stephens, Jr., Senior Vice President and Controller of
the above named bank do hereby declare that this Report of
Condition is true and correct to the best of my knowledge and
belief.
(Signed) Lester J. Stephens, Jr.
We the undersigned directors, attest to the correctness of this
statement of resources and liabilities. We declare that it has
been examined by us, and to the best of our knowledge and belief
has been prepared in conformance with the instructions and is true
and correct.
(Signed) Thomas G. Labrecque
(Signed) Richard J. Boyle Directors
(Signed) Donald H. Trautlein
<PAGE>
EXHIBIT 25-B
Securities Act of 1933 File No. _________
(If application to determine eligibility of
trustee for delayed offering pursuant to
Section 305 (b) (2))
_________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE
PURSUANT TO SECTION
305(b)(2)__________
___________________
THE CHASE MANHATTAN BANK
(National Association)
(Exact name of trustee as specified in its charter)
13-2633612
(I.R.S. Employer Identification Number)
1 Chase Manhattan Plaza, New York, New York
(Address of principal executive offices)
10081
(Zip Code)
________________
SOUTHERN UNION COMPANY
(Exact name of obligor as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
75-0571592
(I.R.S. Employer Identification No.)
504 Lavaca Street, Suite 800
Austin, Texas
(Address of principal executive offices)
78701
(Zip Code)
__________________________________
Senior Debt Securities
(Title of the indenture securities)
_________________________________________________________________
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising
authority to which it is subject.
Comptroller of the Currency, Washington, D.C.
Board of Governors of The Federal Reserve System,
Washington, D. C.
(b) Whether it is authorized to exercise corporate
trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe
each such affiliation.
The Trustee is not the obligor, nor is the Trustee
directly or indirectly controlling, controlled by, or
under common control with the obligor. (See Note on Page
2.)
Item 16. List of Exhibits.
List below all exhibits filed as a part of this
statement of eligibility.
*1. -- A copy of the articles of association of the
trustee as now in effect .(See Exhibit T-1 (Item
12) , Registration No. 33-55626.)
*2. -- Copies of the respective authorizations of The
Chase Manhattan Bank (National Association) and
The Chase Bank of New York (National Association)
to commence business and a copy of approval of
merger of said corporations, all of which
documents are still in effect. (See Exhibit T-1
(Item 12), Registration No. 2-67437.)
*3. -- Copies of authorizations of the Chase Manhattan
Bank (National Association) to exercise corporate
trust powers, both of which documents are still in
effect. (See Exhibit T-1 (Item 12), Registration
No. 2-67437).
*4. -- A copy of the existing by-laws of the trustee.
(See Exhibit T-1 (Item 12(a)), Registration No.
33-28806.)
*5. -- A copy of each indenture referred to in Item 4, if
the obligor is in default. (Not applicable).
*6. -- The consents of United States institutional
trustees required by Section 321(b) of the Act.
See Exhibit T-1, (Item 12), Registration No. 22
-19019.)
7. -- A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
___________________
*The Exhibits thus designated are incorporated herein by
reference. Following the description of such Exhibits is a
reference to the copy of the Exhibit heretofore filed with
the Securities and Exchange Commission, to which there have
been no amendments or changes.
NOTE
Inasmuch as this Form T-1 is filed prior to the
ascertainment by the trustee of all facts on which to base a
responsive answer to Item 2 the answer to said Item is based on
incomplete information.
Item 2 may, however, be considered as correct unless
amended by an amendment to this Form T-1.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act
of 1939, the trustee, The Chase Manhattan Bank (National
Association), a corporation organized and existing under the laws
of the United States of America, has duly caused this statement of
eligibility to be signed on its behalf by the undersigned,
thereunto duly authorized, all in the City of New York, and the
State of New York, on the 4th day of May, 1995.
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION)
By Timothy E. Burke
___________________
Second Vice President
Exhibit 7
---------
REPORT OF CONDITION
Consolidating domestic and foreign subsidiaries of the
THE CHASE MANHATTAN BANK, N.A.
of New York in the State of New York, at the close of business on
December 31, 1994, published in response to call made by
Comptroller of the Currency, under title 12, United States Code,
Section 161.
Charter Number 2370
Comptroller of the Currency Northeastern District
Statement of Resources and Liabilities
Thousands
ASSETS of Dollars
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and
coin...................................... $ 4,517,179
Interest-bearing bearing............... 7,001,642
Held to maturity securities..................... 1,593,325
Available-for-sale securities................... 4,669,255
Federal funds sold and securities purchased under
agreement to resell in domestic offices of
the bank and of its Edge and Agreement
subsidiaries, and in IBFs:
Federal funds sold.......................... 3,651,850
Securities purchased under
agreements to resell...................... 0
Loans and lease financing receivable:
Loans and leases, net
of unearned income........... $ 50,879,818
LESS: Allowance for
loan and lease losses........ 1,073,196
LESS: Allocated transfer
risk reserve................. 0
------------
Loans and leases, net of unearned income,
allowance, and reserve................... 49,806,622
Assets held in trading accounts................ 13,112,807
Premises and fixed assets (including
capitalized leases).......................... 1,758,500
Other real estate owned........................ 480,982
Investments in unconsolidated subsidiaries
and associated companies..................... 55,722
Customers' liability to this bank on acceptances
outstanding ................................. 611,839
Intangible assets.............................. 787,948
Other assets................................... 6,145,452
-------------
TOTAL ASSETS................................... $ 94,193,123
=============
LIABILITIES
Deposits:
In domestic offices....................... $ 29,536,028
Noninterest-bearing....... $ 11,648,377
Interest-bearing.......... 17,887,651
------------
In foreign offices, Edge and Agreement
subsidiaries, and IBFs................. 36,020,612
Noninterest-bearing....... $ 2,320,293
Interest-bearing.......... 33,700,319
------------
Federal funds purchased and securities sold
under agreements to repurchase in domestic
offices of the bank and of its Edge and
Agreement subsidiaries, and in IBFs:
Federal funds purchased................ 1,014,936
Securities sold under agreements
to repurchase........................ 678,033
Demand notes issued to the U.S. Treasury....... 300,000
Trading liabilities............................ 8,066,477
Other borrowed money:
With original maturity of one year
or less................................ 2,940,252
With original maturity of more than
one year............................... 427,525
Mortgage indebtedness and obligations
under capitalized leases.................. 40,550
Bank's liability on acceptances executed
and outstanding........................... 616,531
Subordinated notes and debentures.............. 2,360,000
Other liabilities.............................. 5,195,890
-------------
TOTAL LIABILITIES.............................. 87,196,834
-------------
Limited-life preferred stock and
related surplus........................... 0
EQUITY CAPITAL
Perpetual preferred stock and
related surplus........................... 0
Common stock................................... 915,576
Surplus........................................ 4,656,010
Undivided profits and capital reserves......... 1,478,713
Net unrealized holding gains (losses) on
available-for-sale securities............. (64,959)
Cumulative foreign currency translation
adjustments............................... 10,949
-------------
TOTAL EQUITY CAPITAL........................... 6,996,289
-------------
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED
STOCK, AND EQUITY CAPITAL................. $ 94,193,123
=============
I, Lester J. Stephens, Jr., Senior Vice President and Controller of
the above named bank do hereby declare that this Report of
Condition is true and correct to the best of my knowledge and
belief.
(Signed) Lester J. Stephens, Jr.
We the undersigned directors, attest to the correctness of this
statement of resources and liabilities. We declare that it has
been examined by us, and to the best of our knowledge and belief
has been prepared in conformance with the instructions and is true
and correct.
(Signed) Thomas G. Labrecque
(Signed) Richard J. Boyle Directors
(Signed) Donald H. Trautlein
<PAGE>
EXHIBIT 25.C
Registration No.
________________________________________________________________
________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE
PURSUANT TO SECTION 305(b)(2) X
WILMINGTON TRUST COMPANY
(Exact name of trustee as specified in its charter)
Delaware 51-0055023
(State of incorporation) (I.R.S. employer
identification no.)
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890
(Address of principal executive offices)
Cynthia L. Corliss
Vice President and Trust Counsel
Wilmington Trust Company
Rodney Square North
Wilmington, Delaware 19890
(302) 651-8516
(Name, address and telephone number of agent for service)
SOUTHERN UNION COMPANY
SOUTHERN UNION FINANCING I
(Exact name of obligor as specified in its charter)
Delaware 75-0571592
Delaware To Be Applied For
(State of incorporation) (I.R.S. employer identification no.)
504 Levaca Street, Suite 800
Austin, Texas 78701
(Address of principal executive offices (Zip Code)
of each obligor)
Preferred Securities of Southern Union Financing I
(Title of the indenture securities)
_________________________________________________________________
<PAGE>
ITEM 1. GENERAL INFORMATION.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising
authority to which it is subject.
Federal Deposit Insurance Co. State Bank
Five Penn Center Commissioner
Suite #2901 Dover, Delaware
Philadelphia, PA
(b) Whether it is authorized to exercise corporate trust
powers.
The trustee is authorized to exercise corporate
trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR.
If the obligor is an affiliate of the trustee, describe
each affiliation:
Based upon an examination of the books and records of
the trustee and upon information furnished by the
obligor, the obligor is not an affiliate of the
trustee.
ITEM 3. LIST OF EXHIBITS.
List below all exhibits filed as part of this Statement
of Eligibility and Qualification.
A. Charter of Wilmington Trust Company, which includes
the certificate of authority of Wilmington Trust
Company to commence business and the authorization
of Wilmington Trust Company to exercise corporate
trust powers. Said Charter is incorporated herein
by reference to Registration No. 22-21841/Pre-
Effective Amendment No. 3 to Form T-1 filed by
Wilmington Trust Company in May, 1992, with respect
to Subordinated Notes due 2002 of Supermarkets
General Holdings Corporation.
B. By-Laws of Wilmington Trust Company. Said By-Laws
are incorporated herein by reference to
Registration No. 22-21841/Pre-Effective Amendment
No. 3 to Form T-1 filed by Wilmington Trust Company
in May, 1992, with respect to Subordinated Notes
due 2002 of Supermarket Generals Holdings
Corporation.
C. Consent of Wilmington Trust Company required by
Section 321(b) of Trust Indenture Act.
D. Copy of most recent Report of Condition of
Wilmington Trust Company.
Pursuant to the requirements of the Trust Indenture Act
of 1939, the trustee, Wilmington Trust Company, a
corporation organized and existing under the laws of
Delaware, has duly caused this Statement of Eligibility
to be signed on its behalf by the undersigned, thereunto
duly authorized, all in the City of Wilmington and State
of Delaware on the 4th day of May, 1995.
WILMINGTON TRUST COMPANY
[SEAL]
By: /s/ Cynthia L. Corliss
______________________
Attest: /s/ Kimberly A. Haren Name: Cynthia L. Corliss
______________________
Assistant Secretary Title: Vice President
<PAGE>
EXHIBIT C
Section 321(b) Consent
Pursuant to Section 321(b) of the Trust Indenture Act of 1939,
Wilmington Trust Company hereby consents that reports of
examinations by Federal, State, Territorial or District authorities
may be furnished by such authorities to the Securities Exchange
Commission upon requests therefor.
WILMINGTON TRUST COMPANY
Dated: May 4, 1995 By: /s/ Cynthia L. Corliss
______________________
Name: Cynthia L. Corliss
Title: Vice President
<PAGE>
EXHIBIT D
NOTICE
This form is intended to assist state nonmember banks and savings
banks with state publication requirements. It has not been
approved by any state banking authorities. Refer to your
appropriate state banking authorities for your state publication
requirements.
R E P O R T O F C O N D I T I O N
Consolidating domestic subsidiaries of the
WILMINGTON TRUST COMPANY of WILMINGTON
________________________________________ __________________
Name of Bank City
in the State of DELAWARE , at the close of business on
____________
December 31, 1994.
ASSETS
Thousands of dollars
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coins . 196,088
Interest-bearing balances . . . . . . . . . . . . . . 0
Held-to-maturity securities . . . . . . . . . . . . . . 706,396
Available-for-sale securities . . . . . . . . . . . . . 252,556
Federal funds sold. . . . . . . . . . . . . . . . . . . 15,860
Securities purchased under agreements to resell . . . . 116,500
Loans and lease financing receivables:
Loans and leases, net of unearned income. . . . . . . 3,189,633
LESS: Allowance for loan and lease losses. . . . . 46,554
LESS: Allocated transfer risk reserve. . . . . . . 0
Loans and leases, net of unearned income, allowance,
and reserve . . . . . . . . . . . . . . . . . . . . 3,143,079
Assets held in trading accounts . . . . . . . . . . . . 0
Premises and fixed assets (including capitalized
leases) . . . . . . . . . . . . . . . . . . . . . . . 66,834
Other real estate owned . . . . . . . . . . . . . . . . 21,404
Investments in unconsolidated subsidiaries and
associated companies. . . . . . . . . . . . . . . . . 2,415
Customers' liability to this bank on acceptances
outstanding . . . . . . . . . . . . . . . . . . . . . 0
Intangible assets . . . . . . . . . . . . . . . . . . . 5,129
Other assets. . . . . . . . . . . . . . . . . . . . . . 98,605
Total assets. . . . . . . . . . . . . . . . . . . . . . 4,624,866
LIABILITIES
Deposits:
In domestic offices . . . . . . . . . . . . . . . . . . 3,200,395
Noninterest-bearing. . . . . . . . . . . . . . . . 700,402
Interest-bearing . . . . . . . . . . . . . . . . . 2,499,993
Federal funds purchased . . . . . . . . . . . . . . . . 153,625
Securities sold under agreements to repurchase . . . . 126,856
Demand notes issued to the U.S. Treasury . . . . . . . 37,308
Trading liabilities . . . . . . . . . . . . . . . . . . 0
Other borrowed money: . . . . . . . . . . . . . . . . . ///////
With original maturity of one year or less. . . . . . 621,800
With original maturity of more than one year. . . . . 0
Mortgage indebtedness and obligations under
capitalized leases. . . . . . . . . . . . . . . . . 2,093
Bank's liability on acceptances executed and
outstanding . . . . . . . . . . . . . . . . . . . . 0
Subordinated notes and debentures . . . . . . . . . . . 0
Other liabilities . . . . . . . . . . . . . . . . . . . 88,513
Total liabilities . . . . . . . . . . . . . . . . . . . 4,230,590
Limited-life preferred stock and related surplus. . . . 0
EQUITY CAPITAL
Perpetual preferred stock and related surplus . . . . . 0
Common Stock. . . . . . . . . . . . . . . . . . . . . . 500
Surplus . . . . . . . . . . . . . . . . . . . . . . . . 62,118
Undivided profits and capital reserves. . . . . . . . . 331,953
Net unrealized holding gains (losses) on
available-for-sale securities . . . . . . . . . . . . (295)
Total equity capital. . . . . . . . . . . . . . . . . . 394,276
Total liabilities, limited-life preferred stock,
and equity capital. . . . . . . . . . . . . . . . . . 4,624,866
We, the undersigned directors, attest to
the correctness of this statement of
resources and liabilities. We declare
that it has been examined by us, and
to the best of our knowledge and belief
has been prepared in conformance with
the instructions and is true and correct.
/s/ Carolyn S. Burger ]
_____________________
/s/ David P. Roselle ] Directors
____________________
/s/ Leonard W. Quill ]
____________________
I, David R. Gibson , Senior Vice President of the above named
_____________________ _____________________
bank do hereby declare that this Report of Condition is true and
correct to the best of my knowledge and belief.
/s/ David R. Gibson
___________________
Signature
<PAGE>
EXHIBIT 25.D
Registration No.
________________________________________________________________
________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE
PURSUANT TO SECTION 305(b)(2) X
WILMINGTON TRUST COMPANY
(Exact name of trustee as specified in its charter)
Delaware 51-0055023
(State of incorporation) (I.R.S. employer
identification no.)
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890
(Address of principal executive offices)
Cynthia L. Corliss
Vice President and Trust Counsel
Wilmington Trust Company
Rodney Square North
Wilmington, Delaware 19890
(302) 651-8516
(Name, address and telephone number of agent for service)
SOUTHERN UNION COMPANY
SOUTHERN UNION FINANCING II
(Exact name of obligor as specified in its charter)
Delaware 75-0571592
Delaware To Be Applied For
(State of incorporation) (I.R.S. employer identification no.)
504 Levaca Street, Suite 800
Austin, Texas 78701
(Address of principal executive offices (Zip Code)
of each obligor)
Preferred Securities of Southern Union Financing II
(Title of the indenture securities)
_________________________________________________________________
<PAGE>
ITEM 1. GENERAL INFORMATION.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising
authority to which it is subject.
Federal Deposit Insurance Co. State Bank
Five Penn Center Commissioner
Suite #2901 Dover, Delaware
Philadelphia, PA
(b) Whether it is authorized to exercise corporate trust
powers.
The trustee is authorized to exercise corporate
trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR.
If the obligor is an affiliate of the trustee, describe
each affiliation:
Based upon an examination of the books and records of
the trustee and upon information furnished by the
obligor, the obligor is not an affiliate of the
trustee.
ITEM 3. LIST OF EXHIBITS.
List below all exhibits filed as part of this Statement
of Eligibility and Qualification.
A. Charter of Wilmington Trust Company, which includes
the certificate of authority of Wilmington Trust
Company to commence business and the authorization
of Wilmington Trust Company to exercise corporate
trust powers. Said Charter is incorporated herein
by reference to Registration No. 22-21841/Pre-
Effective Amendment No. 3 to Form T-1 filed by
Wilmington Trust Company in May, 1992, with respect
to Subordinated Notes due 2002 of Supermarkets
General Holdings Corporation.
B. By-Laws of Wilmington Trust Company. Said By-Laws
are incorporated herein by reference to
Registration No. 22-21841/Pre-Effective Amendment
No. 3 to Form T-1 filed by Wilmington Trust Company
in May, 1992, with respect to Subordinated Notes
due 2002 of Supermarket Generals Holdings
Corporation.
C. Consent of Wilmington Trust Company required by
Section 321(b) of Trust Indenture Act.
D. Copy of most recent Report of Condition of
Wilmington Trust Company.
Pursuant to the requirements of the Trust Indenture Act
of 1939, the trustee, Wilmington Trust Company, a
corporation organized and existing under the laws of
Delaware, has duly caused this Statement of Eligibility
to be signed on its behalf by the undersigned, thereunto
duly authorized, all in the City of Wilmington and State
of Delaware on the 4th day of May, 1995.
WILMINGTON TRUST COMPANY
[SEAL]
By: /s/ Cynthia L. Corliss
______________________
Attest: /s/ Kimberly A. Haren Name: Cynthia L. Corliss
______________________
Assistant Secretary Title: Vice President
<PAGE>
EXHIBIT C
Section 321(b) Consent
Pursuant to Section 321(b) of the Trust Indenture Act of 1939,
Wilmington Trust Company hereby consents that reports of
examinations by Federal, State, Territorial or District authorities
may be furnished by such authorities to the Securities Exchange
Commission upon requests therefor.
WILMINGTON TRUST COMPANY
Dated: May 4, 1995 By: /s/ Cynthia L. Corliss
______________________
Name: Cynthia L. Corliss
Title: Vice President
<PAGE>
EXHIBIT D
NOTICE
This form is intended to assist state nonmember banks and savings
banks with state publication requirements. It has not been
approved by any state banking authorities. Refer to your
appropriate state banking authorities for your state publication
requirements.
R E P O R T O F C O N D I T I O N
Consolidating domestic subsidiaries of the
WILMINGTON TRUST COMPANY of WILMINGTON
________________________________________ __________________
Name of Bank City
in the State of DELAWARE , at the close of business on
____________
December 31, 1994.
ASSETS
Thousands of dollars
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coins . 196,088
Interest-bearing balances . . . . . . . . . . . . . . 0
Held-to-maturity securities . . . . . . . . . . . . . . 706,396
Available-for-sale securities . . . . . . . . . . . . . 252,556
Federal funds sold. . . . . . . . . . . . . . . . . . . 15,860
Securities purchased under agreements to resell . . . . 116,500
Loans and lease financing receivables:
Loans and leases, net of unearned income. . . . . . . 3,189,633
LESS: Allowance for loan and lease losses. . . . . 46,554
LESS: Allocated transfer risk reserve. . . . . . . 0
Loans and leases, net of unearned income, allowance,
and reserve . . . . . . . . . . . . . . . . . . . . 3,143,079
Assets held in trading accounts . . . . . . . . . . . . 0
Premises and fixed assets (including capitalized
leases) . . . . . . . . . . . . . . . . . . . . . . . 66,834
Other real estate owned . . . . . . . . . . . . . . . . 21,404
Investments in unconsolidated subsidiaries and
associated companies. . . . . . . . . . . . . . . . . 2,415
Customers' liability to this bank on acceptances
outstanding . . . . . . . . . . . . . . . . . . . . . 0
Intangible assets . . . . . . . . . . . . . . . . . . . 5,129
Other assets. . . . . . . . . . . . . . . . . . . . . . 98,605
Total assets. . . . . . . . . . . . . . . . . . . . . . 4,624,866
LIABILITIES
Deposits:
In domestic offices . . . . . . . . . . . . . . . . . . 3,200,395
Noninterest-bearing. . . . . . . . . . . . . . . . 700,402
Interest-bearing . . . . . . . . . . . . . . . . . 2,499,993
Federal funds purchased . . . . . . . . . . . . . . . . 153,625
Securities sold under agreements to repurchase . . . . 126,856
Demand notes issued to the U.S. Treasury . . . . . . . 37,308
Trading liabilities . . . . . . . . . . . . . . . . . . 0
Other borrowed money: . . . . . . . . . . . . . . . . . ///////
With original maturity of one year or less. . . . . . 621,800
With original maturity of more than one year. . . . . 0
Mortgage indebtedness and obligations under
capitalized leases. . . . . . . . . . . . . . . . . 2,093
Bank's liability on acceptances executed and
outstanding . . . . . . . . . . . . . . . . . . . . 0
Subordinated notes and debentures . . . . . . . . . . . 0
Other liabilities . . . . . . . . . . . . . . . . . . . 88,513
Total liabilities . . . . . . . . . . . . . . . . . . . 4,230,590
Limited-life preferred stock and related surplus. . . . 0
EQUITY CAPITAL
Perpetual preferred stock and related surplus . . . . . 0
Common Stock. . . . . . . . . . . . . . . . . . . . . . 500
Surplus . . . . . . . . . . . . . . . . . . . . . . . . 62,118
Undivided profits and capital reserves. . . . . . . . . 331,953
Net unrealized holding gains (losses) on
available-for-sale securities . . . . . . . . . . . . (295)
Total equity capital. . . . . . . . . . . . . . . . . . 394,276
Total liabilities, limited-life preferred stock,
and equity capital. . . . . . . . . . . . . . . . . . 4,624,866
We, the undersigned directors, attest to
the correctness of this statement of
resources and liabilities. We declare
that it has been examined by us, and
to the best of our knowledge and belief
has been prepared in conformance with
the instructions and is true and correct.
/s/ Carolyn S. Burger ]
_____________________
/s/ David P. Roselle ] Directors
____________________
/s/ Leonard W. Quill ]
____________________
I, David R. Gibson , Senior Vice President of the above named
_____________________ _____________________
bank do hereby declare that this Report of Condition is true and
correct to the best of my knowledge and belief.
/s/ David R. Gibson
___________________
Signature
<PAGE>
EXHIBIT 25.E
Registration No.
________________________________________________________________
________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE
PURSUANT TO SECTION 305(b)(2) X
WILMINGTON TRUST COMPANY
(Exact name of trustee as specified in its charter)
Delaware 51-0055023
(State of incorporation) (I.R.S. employer
identification no.)
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890
(Address of principal executive offices)
Cynthia L. Corliss
Vice President and Trust Counsel
Wilmington Trust Company
Rodney Square North
Wilmington, Delaware 19890
(302) 651-8516
(Name, address and telephone number of agent for service)
SOUTHERN UNION COMPANY
SOUTHERN UNION FINANCING III
(Exact name of obligor as specified in its charter)
Delaware 75-0571592
Delaware To Be Applied For
(State of incorporation) (I.R.S. employer identification no.)
504 Levaca Street, Suite 800
Austin, Texas 78701
(Address of principal executive offices (Zip Code)
of each obligor)
Preferred Securities of Southern Union Financing III
(Title of the indenture securities)
_________________________________________________________________
<PAGE>
ITEM 1. GENERAL INFORMATION.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising
authority to which it is subject.
Federal Deposit Insurance Co. State Bank
Five Penn Center Commissioner
Suite #2901 Dover, Delaware
Philadelphia, PA
(b) Whether it is authorized to exercise corporate trust
powers.
The trustee is authorized to exercise corporate
trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR.
If the obligor is an affiliate of the trustee, describe
each affiliation:
Based upon an examination of the books and records of
the trustee and upon information furnished by the
obligor, the obligor is not an affiliate of the
trustee.
ITEM 3. LIST OF EXHIBITS.
List below all exhibits filed as part of this Statement
of Eligibility and Qualification.
A. Charter of Wilmington Trust Company, which includes
the certificate of authority of Wilmington Trust
Company to commence business and the authorization
of Wilmington Trust Company to exercise corporate
trust powers. Said Charter is incorporated herein
by reference to Registration No. 22-21841/Pre-
Effective Amendment No. 3 to Form T-1 filed by
Wilmington Trust Company in May, 1992, with respect
to Subordinated Notes due 2002 of Supermarkets
General Holdings Corporation.
B. By-Laws of Wilmington Trust Company. Said By-Laws
are incorporated herein by reference to
Registration No. 22-21841/Pre-Effective Amendment
No. 3 to Form T-1 filed by Wilmington Trust Company
in May, 1992, with respect to Subordinated Notes
due 2002 of Supermarket Generals Holdings
Corporation.
C. Consent of Wilmington Trust Company required by
Section 321(b) of Trust Indenture Act.
D. Copy of most recent Report of Condition of
Wilmington Trust Company.
Pursuant to the requirements of the Trust Indenture Act
of 1939, the trustee, Wilmington Trust Company, a
corporation organized and existing under the laws of
Delaware, has duly caused this Statement of Eligibility
to be signed on its behalf by the undersigned, thereunto
duly authorized, all in the City of Wilmington and State
of Delaware on the 4th day of May, 1995.
WILMINGTON TRUST COMPANY
[SEAL]
By: /s/ Cynthia L. Corliss
______________________
Attest: /s/ Kimberly A. Haren Name: Cynthia L. Corliss
______________________
Assistant Secretary Title: Vice President
<PAGE>
EXHIBIT C
Section 321(b) Consent
Pursuant to Section 321(b) of the Trust Indenture Act of 1939,
Wilmington Trust Company hereby consents that reports of
examinations by Federal, State, Territorial or District authorities
may be furnished by such authorities to the Securities Exchange
Commission upon requests therefor.
WILMINGTON TRUST COMPANY
Dated: May 4, 1995 By: /s/ Cynthia L. Corliss
______________________
Name: Cynthia L. Corliss
Title: Vice President
<PAGE>
EXHIBIT D
NOTICE
This form is intended to assist state nonmember banks and savings
banks with state publication requirements. It has not been
approved by any state banking authorities. Refer to your
appropriate state banking authorities for your state publication
requirements.
R E P O R T O F C O N D I T I O N
Consolidating domestic subsidiaries of the
WILMINGTON TRUST COMPANY of WILMINGTON
________________________________________ __________________
Name of Bank City
in the State of DELAWARE , at the close of business on
____________
December 31, 1994.
ASSETS
Thousands of dollars
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coins . 196,088
Interest-bearing balances . . . . . . . . . . . . . . 0
Held-to-maturity securities . . . . . . . . . . . . . . 706,396
Available-for-sale securities . . . . . . . . . . . . . 252,556
Federal funds sold. . . . . . . . . . . . . . . . . . . 15,860
Securities purchased under agreements to resell . . . . 116,500
Loans and lease financing receivables:
Loans and leases, net of unearned income. . . . . . . 3,189,633
LESS: Allowance for loan and lease losses. . . . . 46,554
LESS: Allocated transfer risk reserve. . . . . . . 0
Loans and leases, net of unearned income, allowance,
and reserve . . . . . . . . . . . . . . . . . . . . 3,143,079
Assets held in trading accounts . . . . . . . . . . . . 0
Premises and fixed assets (including capitalized
leases) . . . . . . . . . . . . . . . . . . . . . . . 66,834
Other real estate owned . . . . . . . . . . . . . . . . 21,404
Investments in unconsolidated subsidiaries and
associated companies. . . . . . . . . . . . . . . . . 2,415
Customers' liability to this bank on acceptances
outstanding . . . . . . . . . . . . . . . . . . . . . 0
Intangible assets . . . . . . . . . . . . . . . . . . . 5,129
Other assets. . . . . . . . . . . . . . . . . . . . . . 98,605
Total assets. . . . . . . . . . . . . . . . . . . . . . 4,624,866
LIABILITIES
Deposits:
In domestic offices . . . . . . . . . . . . . . . . . . 3,200,395
Noninterest-bearing. . . . . . . . . . . . . . . . 700,402
Interest-bearing . . . . . . . . . . . . . . . . . 2,499,993
Federal funds purchased . . . . . . . . . . . . . . . . 153,625
Securities sold under agreements to repurchase . . . . 126,856
Demand notes issued to the U.S. Treasury . . . . . . . 37,308
Trading liabilities . . . . . . . . . . . . . . . . . . 0
Other borrowed money: . . . . . . . . . . . . . . . . . ///////
With original maturity of one year or less. . . . . . 621,800
With original maturity of more than one year. . . . . 0
Mortgage indebtedness and obligations under
capitalized leases. . . . . . . . . . . . . . . . . 2,093
Bank's liability on acceptances executed and
outstanding . . . . . . . . . . . . . . . . . . . . 0
Subordinated notes and debentures . . . . . . . . . . . 0
Other liabilities . . . . . . . . . . . . . . . . . . . 88,513
Total liabilities . . . . . . . . . . . . . . . . . . . 4,230,590
Limited-life preferred stock and related surplus. . . . 0
EQUITY CAPITAL
Perpetual preferred stock and related surplus . . . . . 0
Common Stock. . . . . . . . . . . . . . . . . . . . . . 500
Surplus . . . . . . . . . . . . . . . . . . . . . . . . 62,118
Undivided profits and capital reserves. . . . . . . . . 331,953
Net unrealized holding gains (losses) on
available-for-sale securities . . . . . . . . . . . . (295)
Total equity capital. . . . . . . . . . . . . . . . . . 394,276
Total liabilities, limited-life preferred stock,
and equity capital. . . . . . . . . . . . . . . . . . 4,624,866
We, the undersigned directors, attest to
the correctness of this statement of
resources and liabilities. We declare
that it has been examined by us, and
to the best of our knowledge and belief
has been prepared in conformance with
the instructions and is true and correct.
/s/ Carolyn S. Burger ]
_____________________
/s/ David P. Roselle ] Directors
____________________
/s/ Leonard W. Quill ]
____________________
I, David R. Gibson , Senior Vice President of the above named
_____________________ _____________________
bank do hereby declare that this Report of Condition is true and
correct to the best of my knowledge and belief.
/s/ David R. Gibson
___________________
Signature
<PAGE>
EXHIBIT 25.F
Registration No.
________________________________________________________________
________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE
PURSUANT TO SECTION 305(b)(2) X
WILMINGTON TRUST COMPANY
(Exact name of trustee as specified in its charter)
Delaware 51-0055023
(State of incorporation) (I.R.S. employer
identification no.)
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890
(Address of principal executive offices)
Cynthia L. Corliss
Vice President and Trust Counsel
Wilmington Trust Company
Rodney Square North
Wilmington, Delaware 19890
(302) 651-8516
(Name, address and telephone number of agent for service)
SOUTHERN UNION COMPANY
(Exact name of obligor as specified in its charter)
Delaware 75-0571592
(State of incorporation) (I.R.S. employer identification no.)
504 Levaca Street, Suite 800
Austin, Texas 78701
(Address of principal executive offices (Zip Code)
of each obligor)
Guarantees of
Preferred Securities of Southern Union Financing I,
Preferred Securities of Southern Union Financing II, and
Preferred Securities of Southern Union Financing III
(Title of the indenture securities)
_________________________________________________________________
<PAGE>
ITEM 1. GENERAL INFORMATION.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising
authority to which it is subject.
Federal Deposit Insurance Co. State Bank
Five Penn Center Commissioner
Suite #2901 Dover, Delaware
Philadelphia, PA
(b) Whether it is authorized to exercise corporate trust
powers.
The trustee is authorized to exercise corporate
trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR.
If the obligor is an affiliate of the trustee, describe
each affiliation:
Based upon an examination of the books and records of
the trustee and upon information furnished by the
obligor, the obligor is not an affiliate of the
trustee.
ITEM 3. LIST OF EXHIBITS.
List below all exhibits filed as part of this Statement
of Eligibility and Qualification.
A. Charter of Wilmington Trust Company, which includes
the certificate of authority of Wilmington Trust
Company to commence business and the authorization
of Wilmington Trust Company to exercise corporate
trust powers. Said Charter is incorporated herein
by reference to Registration No. 22-21841/Pre-
Effective Amendment No. 3 to Form T-1 filed by
Wilmington Trust Company in May, 1992, with respect
to Subordinated Notes due 2002 of Supermarkets
General Holdings Corporation.
B. By-Laws of Wilmington Trust Company. Said By-Laws
are incorporated herein by reference to
Registration No. 22-21841/Pre-Effective Amendment
No. 3 to Form T-1 filed by Wilmington Trust Company
in May, 1992, with respect to Subordinated Notes
due 2002 of Supermarket Generals Holdings
Corporation.
C. Consent of Wilmington Trust Company required by
Section 321(b) of Trust Indenture Act.
D. Copy of most recent Report of Condition of
Wilmington Trust Company.
Pursuant to the requirements of the Trust Indenture Act
of 1939, the trustee, Wilmington Trust Company, a
corporation organized and existing under the laws of
Delaware, has duly caused this Statement of Eligibility
to be signed on its behalf by the undersigned, thereunto
duly authorized, all in the City of Wilmington and State
of Delaware on the 4th day of May, 1995.
WILMINGTON TRUST COMPANY
[SEAL]
By: /s/ Cynthia L. Corliss
______________________
Attest: /s/ Kimberly A. Haren Name: Cynthia L. Corliss
______________________
Assistant Secretary Title: Vice President
<PAGE>
EXHIBIT C
Section 321(b) Consent
Pursuant to Section 321(b) of the Trust Indenture Act of 1939,
Wilmington Trust Company hereby consents that reports of
examinations by Federal, State, Territorial or District authorities
may be furnished by such authorities to the Securities Exchange
Commission upon requests therefor.
WILMINGTON TRUST COMPANY
Dated: May 4, 1995 By: /s/ Cynthia L. Corliss
______________________
Name: Cynthia L. Corliss
Title: Vice President
<PAGE>
EXHIBIT D
NOTICE
This form is intended to assist state nonmember banks and savings
banks with state publication requirements. It has not been
approved by any state banking authorities. Refer to your
appropriate state banking authorities for your state publication
requirements.
R E P O R T O F C O N D I T I O N
Consolidating domestic subsidiaries of the
WILMINGTON TRUST COMPANY of WILMINGTON
________________________________________ __________________
Name of Bank City
in the State of DELAWARE , at the close of business on
____________
December 31, 1994.
ASSETS
Thousands of dollars
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coins . 196,088
Interest-bearing balances . . . . . . . . . . . . . . 0
Held-to-maturity securities . . . . . . . . . . . . . . 706,396
Available-for-sale securities . . . . . . . . . . . . . 252,556
Federal funds sold. . . . . . . . . . . . . . . . . . . 15,860
Securities purchased under agreements to resell . . . . 116,500
Loans and lease financing receivables:
Loans and leases, net of unearned income. . . . . . . 3,189,633
LESS: Allowance for loan and lease losses. . . . . 46,554
LESS: Allocated transfer risk reserve. . . . . . . 0
Loans and leases, net of unearned income, allowance,
and reserve . . . . . . . . . . . . . . . . . . . . 3,143,079
Assets held in trading accounts . . . . . . . . . . . . 0
Premises and fixed assets (including capitalized
leases) . . . . . . . . . . . . . . . . . . . . . . . 66,834
Other real estate owned . . . . . . . . . . . . . . . . 21,404
Investments in unconsolidated subsidiaries and
associated companies. . . . . . . . . . . . . . . . . 2,415
Customers' liability to this bank on acceptances
outstanding . . . . . . . . . . . . . . . . . . . . . 0
Intangible assets . . . . . . . . . . . . . . . . . . . 5,129
Other assets. . . . . . . . . . . . . . . . . . . . . . 98,605
Total assets. . . . . . . . . . . . . . . . . . . . . . 4,624,866
LIABILITIES
Deposits:
In domestic offices . . . . . . . . . . . . . . . . . . 3,200,395
Noninterest-bearing. . . . . . . . . . . . . . . . 700,402
Interest-bearing . . . . . . . . . . . . . . . . . 2,499,993
Federal funds purchased . . . . . . . . . . . . . . . . 153,625
Securities sold under agreements to repurchase . . . . 126,856
Demand notes issued to the U.S. Treasury . . . . . . . 37,308
Trading liabilities . . . . . . . . . . . . . . . . . . 0
Other borrowed money: . . . . . . . . . . . . . . . . . ///////
With original maturity of one year or less. . . . . . 621,800
With original maturity of more than one year. . . . . 0
Mortgage indebtedness and obligations under
capitalized leases. . . . . . . . . . . . . . . . . 2,093
Bank's liability on acceptances executed and
outstanding . . . . . . . . . . . . . . . . . . . . 0
Subordinated notes and debentures . . . . . . . . . . . 0
Other liabilities . . . . . . . . . . . . . . . . . . . 88,513
Total liabilities . . . . . . . . . . . . . . . . . . . 4,230,590
Limited-life preferred stock and related surplus. . . . 0
EQUITY CAPITAL
Perpetual preferred stock and related surplus . . . . . 0
Common Stock. . . . . . . . . . . . . . . . . . . . . . 500
Surplus . . . . . . . . . . . . . . . . . . . . . . . . 62,118
Undivided profits and capital reserves. . . . . . . . . 331,953
Net unrealized holding gains (losses) on
available-for-sale securities . . . . . . . . . . . . (295)
Total equity capital. . . . . . . . . . . . . . . . . . 394,276
Total liabilities, limited-life preferred stock,
and equity capital. . . . . . . . . . . . . . . . . . 4,624,866
We, the undersigned directors, attest to
the correctness of this statement of
resources and liabilities. We declare
that it has been examined by us, and
to the best of our knowledge and belief
has been prepared in conformance with
the instructions and is true and correct.
/s/ Carolyn S. Burger ]
_____________________
/s/ David P. Roselle ] Directors
____________________
/s/ Leonard W. Quill ]
____________________
I, David R. Gibson , Senior Vice President of the above named
_____________________ _____________________
bank do hereby declare that this Report of Condition is true and
correct to the best of my knowledge and belief.
/s/ David R. Gibson
___________________
Signature
