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Registration No. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________
Form S-3
Registration Statement
Under
The Securities Act of 1933
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COMMONWEALTH EDISON COMPANY ILLINOIS 36-0938600
ComEd FINANCING I DELAWARE Applied For
(Exact name of registrant (State or other jurisdiction of (I.R.S. Employer
as specified in its charter) incorporation or organization) Identification No.)
John C. Bukovski, Vice President
37th Floor, 10 South Dearborn Street 37th Floor, 10 South Dearborn Street
Post Office Box 767 Post Office Box 767
Chicago, Illinois 60690-0767 Chicago, Illinois 60690-0767
312/394-4321 312/394-3117
(Address, including zip code, and telephone number, (Name, address, including zip code, and telephone
including area code, of each registrant's principal number, including area code, of agent for service for
executive offices) each registrant)
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Approximate date of commencement of proposed sale to the public: As soon
as practicable after the Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box. [_]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier registration statement for the same
offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [X]
CALCULATION OF REGISTRATION FEE
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Proposed maximum Proposed maximum Amount of
Title of each class of Amount to be offering price per aggregate offering registration
securities to be registered registered unit (2)(3) price (2)(3) fee
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Preferred Securities of ComEd
Financing I and Subordinated
Deferrable Interest Notes of
Commonwealth Edison Company (1) 8,000,000 $25.00 $200,000,000 $68,965.52
Guarantees of Preferred Securities
of ComEd Financing I by Common- Preferred
wealth Edison Company (4)....... Securities
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Total $200,000,000 $68,965.52
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(1) The Subordinated Deferrable Interest Notes will be purchased by, and
constitute assets of, ComEd Financing I. No separate consideration
therefor will be received.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(i) and Rule 457(n).
(3) Exclusive of accrued interest and distributions, if any.
(4) No separate consideration will be received for the Guarantees.
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
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* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* *
* INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A *
* REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE *
* SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR *
* MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT *
* BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR *
* THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE *
* SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE *
* UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS *
* OF ANY SUCH STATE. *
* *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
Preliminary Prospectus dated July 27, 1995
PROSPECTUS
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8,000,000 Preferred Securities
ComEd Financing I
___% Trust Originated Preferred Securities(SM) ("TOPrS(SM)")
(Liquidation Amount $25 per Preferred Security)
guaranteed to the extent set forth herein by
Commonwealth Edison Company
___________________
The ___% Trust Originated Preferred Securities (the "Preferred Securities")
offered hereby evidence preferred undivided beneficial interests in the assets
of ComEd Financing I, a statutory business trust formed under the laws of the
State of Delaware (the "Trust"). Commonwealth Edison Company, an Illinois
corporation ("ComEd" or the "Company"), will own all the common securities (the
"Common Securities" and, together with the Preferred Securities, the "Trust
Securities") representing common undivided beneficial interests in the assets of
the Trust. The Trust exists for the sole purpose of issuing the Trust
Securities and investing the proceeds thereof in an equivalent principal amount
of ___% Subordinated Deferrable Interest Notes due 2035 (the "Subordinated
Notes") of ComEd. The Subordinated Notes will be unsecured obligations of ComEd
and will
(continued on next page)
__________________
SEE "RISK FACTORS" COMMENCING ON PAGE 5 OF THIS PROSPECTUS FOR CERTAIN
INFORMATION RELEVANT TO AN INVESTMENT IN THE PREFERRED SECURITIES, INCLUDING THE
PERIOD AND CIRCUMSTANCES DURING AND UNDER WHICH PAYMENTS OF DISTRIBUTIONS ON THE
PREFERRED SECURITIES MAY BE DEFERRED AND THE RELATED UNITED STATES FEDERAL
INCOME TAX CONSEQUENCES OF SUCH DEFERRAL.
An application will be filed to list the Preferred Securities on the New
York Stock Exchange, Inc. (the "New York Stock Exchange"). If such application
is approved, trading of the Preferred Securities on the New York Stock Exchange
is expected to commence within a 30-day period after the initial delivery of the
Preferred Securities. See "Underwriting."
____________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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Initial Public Underwriting Proceeds to
Offering Price (1) Commission (2) Trust (3)(4)
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Per Preferred
Security............. $ 25.00 (3) $25.00
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Total................. $200,000,000 (3) $200,000,000
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(1) Plus accrued distributions, if any, from ________, 1995.
(2) ComEd and the Trust have agreed to indemnify the several Underwriters
against certain liabilities, including liabilities under the Securities Act
of 1933, as amended. See "Underwriting."
(3) In view of the fact that the proceeds of the sale of the Preferred
Securities will be invested in Subordinated Notes, ComEd has agreed to pay
to the Underwriters as compensation for their arranging the investment
therein of such proceeds, $________ per Preferred Security (or $________ in
the aggregate); provided, that such compensation for sales of 10,000 or
more Preferred Securities to a single purchaser will be ________ per
Preferred Security. Therefore, to the extent of such sales, the actual
amount of Underwriters' compensation will be less than the aggregate amount
specified in the preceding sentence. See "Underwriting."
(4) Expenses of the offering which are payable by ComEd are estimated to be
$500,000.
The Preferred Securities offered hereby are offered severally by the
Underwriters, as specified herein, subject to receipt and acceptance by them and
subject to their right to reject any order in whole or in part. It is expected
that delivery of the Preferred Securities will be made only in book-entry form
through the facilities of The Depository Trust Company on or about ________,
1995.
____________________
MERRILL LYNCH & CO.
PAINEWEBBER INCORPORATED
SALOMON BROTHERS INC
____________________
The date of this Prospectus is August __, 1995.
(SM)"Trust Originated Preferred Securities" and "TOPrS" are service marks of
Merrill Lynch & Co., Inc.
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[Inside cover page]
(continued from previous page.)
be subordinate and junior in right of payment to certain other indebtedness of
ComEd, as described herein. Upon an event of default under the Declaration (as
defined herein), the holders of the Preferred Securities will have a preference
over the holders of the Common Securities with respect to payments in respect of
distributions and payments upon liquidation, redemption and otherwise.
Holders of the Preferred Securities are entitled to receive cumulative
cash distributions at an annual rate of __ % of the liquidation amount of $25
per Preferred Security, accruing from the date of original issuance and payable
quarterly in arrears on March 31, June 30, September 30 and December 31 of each
year commencing September 30, 1995 ("distributions"). The payment of
distributions out of moneys held by the Trust, and payments on liquidation of
the Trust or the redemption of Preferred Securities, as set forth below, are
guaranteed by ComEd (the "Preferred Securities Guarantee") to the extent the
Trust has funds available therefor as described under "Description of the
Preferred Securities Guarantee." The obligations of ComEd under the Preferred
Securities Guarantee are subordinate and junior in right of payment to all other
liabilities of ComEd and will rank pari passu with the most senior preferred
stock issued by ComEd. The obligations of ComEd under the Subordinated Notes
are subordinate and junior in right of payment to all present and future Senior
Indebtedness (as defined herein) of ComEd. The Senior Indebtedness of ComEd
aggregated approximately $8,231 million at June 30, 1995.
The distribution rate and the distribution and other payment dates for
the Preferred Securities will correspond to the interest rate and interest and
other payment dates on the Subordinated Notes, which will be the sole assets of
the Trust. As a result, if principal or interest is not paid on the Subordinated
Notes, no amounts will be paid on the Preferred Securities. If ComEd does not
make principal or interest payments on the Subordinated Notes, the Trust will
not have sufficient funds to make distributions on the Preferred Securities, in
which event the Preferred Securities Guarantee will not apply to such
distributions until the Trust has sufficient funds available therefor.
ComEd has the right to defer payments of interest on the Subordinated
Notes by extending the interest payment period on the Subordinated Notes, at any
time, for up to 20 consecutive quarters (each, an "Extension Period"). If
interest payments are so deferred, distributions will also be deferred. Despite
such deferral, distributions will continue to accrue with interest thereon (to
the extent permitted by applicable law) at an annual rate of __% per annum,
compounded quarterly, and during any Extension Period, holders of Preferred
Securities will be required to include deferred interest income in their gross
income for United States federal income tax purposes in advance of receipt of
the cash interest payments attributable to such deferred income. There could be
multiple Extension Periods of varying lengths throughout the term of the
Subordinated Notes. See "Description of the Subordinated Notes -- Option to
Extend Interest Payment Period," "Risk Factors -- Option to Extend Interest
Payment Period" and "Certain Federal Income Tax Consequences -- Original Issue
Discount, Premium and Market Discount."
The Subordinated Notes are redeemable by ComEd (in whole or in part)
from time to time, on or after September 30, 2000 or at any time in certain
circumstances upon the occurrence of a Tax Event (as defined herein). If ComEd
redeems Subordinated Notes, the Trust must redeem Trust Securities having an
aggregate liquidation amount equal to the aggregate principal amount of the
Subordinated Notes so redeemed at $25 per Trust Security plus accrued and unpaid
distributions thereon (the "Redemption Price") to the date fixed for redemption.
See "Description of the Preferred Securities -- Mandatory Redemption." The
Preferred Securities will be redeemed upon maturity of the Subordinated Notes.
The Subordinated Notes mature on September 30, 2035. In addition, upon the
occurrence of a Special Event (as defined herein) arising from a change in law
or a change in legal interpretation, unless the Subordinated Notes are redeemed
in the limited circumstances described below, the Trust shall be dissolved with
the result that the Subordinated Notes will be distributed to the holders of the
Preferred Securities, on a pro rata basis, in lieu of any cash distribution. In
the case of the occurrence of a Special Event that is a Tax Event, ComEd will
have the right in certain circumstances to redeem the Subordinated Notes, which
would result in the redemption by the Trust of the Trust Securities in the same
amount on a pro rata basis. If the Subordinated Notes are distributed to the
holders of the Preferred Securities, ComEd will use its best efforts to have the
Subordinated Notes listed on the New York Stock Exchange or on such other
exchange as the Preferred Securities are then listed. See "Description of the
Preferred Securities -- Special Event Redemption or Distribution" and
"Description of the Subordinated Notes."
In the event of the voluntary or involuntary dissolution, winding up
or termination of the Trust, the holders of the Preferred Securities will be
entitled to receive, for each Preferred Security, a liquidation amount of $25
plus accrued and unpaid distributions thereon (including interest thereon) to
the date of payment, unless in connection with such dissolution, the
Subordinated Notes are distributed to the holders of the Preferred Securities.
See "Description of the Preferred Securities --Liquidation Distribution Upon
Dissolution."
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR
EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE
SECURITIES OFFERED HEREBY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN
THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK
EXCHANGE, IN THE OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF
COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
IT IS EXPECTED THAT DELIVERY OF THE PREFERRED SECURITIES WILL BE MADE
AGAINST PAYMENT THEREFOR ON OR ABOUT THE DATE SPECIFIED IN THE LAST PARAGRAPH OF
THE COVER PAGE, WHICH IS THE FIFTH BUSINESS DAY FOLLOWING THE DATE HEREOF (SUCH
SETTLEMENT CYCLE BEING HEREIN REFERRED TO AS "T+5"). PURCHASERS OF THE
PREFERRED SECURITIES SHOULD NOTE THAT THE ABILITY TO SETTLE SECONDARY MARKET
TRADES OF THE PREFERRED SECURITIES ON THE DATE HEREOF AND THE NEXT SUCCEEDING
DAY MAY BE EFFECTED BY THE T+5 SETTLEMENT. SEE "UNDERWRITING."
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AVAILABLE INFORMATION
ComEd and the Trust have filed with the Securities and Exchange
Commission (the "Commission") a combined registration statement on Form S-3
(herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Securities Act") with respect to the Subordinated Notes, the Preferred
Securities and the Preferred Securities Guarantee offered hereby. This
Prospectus does not contain all of the information set forth in the Registration
Statement, certain parts of which are omitted in accordance with the rules and
regulations of the Commission. For further information, reference is hereby
made to the Registration Statement. Statements or extracts presented in this
Prospectus from financial statements, contracts, agreements or other documents
included as exhibits to the Registration Statement are not necessarily complete.
With respect to each such financial statement, contract, agreement or other
document filed as an exhibit to the Registration Statement, reference is hereby
made to the exhibit for a more complete description of the matter involved.
ComEd is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, information statements and other information with the
Commission. Such reports, information statements and other information can be
inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at
the Commission's Regional Offices at Citicorp Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661, and Seven World Trade Center, 13th Floor,
New York, New York 10048. Copies of such material can also be obtained from the
Public Reference Section of the Commission at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, at prescribed rates. Such reports, information
statements and other information concerning ComEd may also be inspected at the
offices of the New York Stock Exchange, Inc., 20 Broad Street, New York, New
York 10005, the Chicago Stock Exchange, 440 South LaSalle Street, Chicago,
Illinois 60604 and the Pacific Stock Exchange, 301 Pine Street, San Francisco,
California 94104, the securities exchanges on which certain of ComEd's
securities are listed.
No separate financial statements of the Trust are included herein.
ComEd does not believe that such statements would be material to holders of the
Preferred Securities. The Trust is not currently subject to the informational
reporting requirements of the Exchange Act. The Trust will become subject to
such requirements upon the effectiveness of the Registration Statement of which
this Prospectus forms a part, although it intends to seek and expects to receive
an exemption therefrom.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by ComEd with the Commission (File No.
1-1839) are incorporated in this Prospectus by reference and made a part hereof:
(i) ComEd's Annual Report on Form 10-K for the year ended December
31, 1994 (the "1994 Form 10-K Report");
(ii) ComEd's Quarterly Report on Form 10-Q for the quarterly period
ended March 31, 1995 (the "March 31, 1995 Form 10-Q Report"); and
(iii) ComEd's Current Report on Form 8-K/A-1 dated January 27, 1995
(the "January 27, 1995 Form 8-K Report").
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All documents subsequently filed by ComEd pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act, after the date of this Prospectus and
prior to the termination of the offering made by this Prospectus, shall be
deemed to be incorporated into this Prospectus by reference and to be a part
hereof from the respective dates of filing of such documents. Any statement
contained in a document incorporated or deemed to be incorporated by reference
in this Prospectus shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained in this Prospectus or
in any other subsequently filed document which also is or is deemed to be
incorporated by reference in this Prospectus modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus.
ComEd will provide without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon written or oral
request of such person, a copy of any or all of the documents that have been or
may be incorporated in this Prospectus by reference, other than certain exhibits
to such documents. Such requests should be directed to David A. Scholz,
Secretary, Commonwealth Edison Company, 37th Floor, 10 South Dearborn Street,
P.O. Box 767, Chicago, Illinois 60690-0767 (telephone number 312/394-3126).
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by reference to the
detailed information appearing elsewhere in this Prospectus. Reference is made
to "Definitions" herein for the location herein of the definitions of certain
capitalized terms used herein.
Preferred Securities Offered. 8,000,000 ___% Trust Originated
Preferred Securities evidencing preferred undivided beneficial interests in the
assets of the Trust are offered hereby. Holders of the Preferred Securities are
entitled to receive cumulative cash distributions at an annual rate of ___% of
the liquidation amount of $25 per Preferred Security, accruing from the date of
original issuance and payable quarterly in arrears on March 31, June 30,
September 30 and December 31 of each year commencing on September 30, 1995. The
distribution rate and the distribution and other payment dates for the Preferred
Securities will correspond to the interest rate and interest and other payment
dates on the Subordinated Notes, which will be the sole assets of the Trust. As
a result, if principal or interest is not paid on the Subordinated Notes, no
amounts will be paid on the Preferred Securities. See "Description of the
Preferred Securities."
Subordinated Notes. The Trust will invest the proceeds from the
issuance of the Preferred Securities and Common Securities in an equivalent
amount of ___% Subordinated Deferrable Interest Notes due 2035 of ComEd. The
Subordinated Notes will be subordinate and junior in right of payment to all
Senior Indebtedness of ComEd. See "Description of Subordinated Notes--
Subordination."
Preferred Securities Guarantee. Payment of distributions out of
moneys held by the Trust, and payments on liquidation of the Trust or the
redemption of Preferred Securities are guaranteed by ComEd to the extent the
Trust has funds available therefor. If ComEd does not make principal or
interest payments on the Subordinated Notes, the Trust will not have sufficient
funds to make distributions on the Preferred Securities, in which event the
Preferred Securities Guarantee will not apply to such distributions until the
Trust has sufficient funds available therefor. See "Description of Preferred
Securities Guarantee" and "Effect of Obligations under the Subordinated Notes
and the Preferred Securities Guarantee" herein. The obligations of ComEd under
the Preferred Securities Guarantee are subordinate and junior in right of
payment to all other liabilities of ComEd and will rank pari passu with the most
senior preferred stock issued by ComEd. See "Risk Factors--Ranking of
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Preferred Securities Guarantee and Subordinated Notes" and "Description of the
Preferred Securities Guarantee."
Interest Deferral. ComEd has the right to defer payments of interest
on the Subordinated Notes by extending the interest payment period on the
Subordinated Notes, at any time, for up to 20 consecutive quarters. If interest
payments on the Subordinated Notes are so deferred, distributions on the
Preferred Securities will also be deferred. During any deferral, distributions
will continue to accrue with interest thereon (to the extent permitted by law)
as described herein. There could be multiple Extension Periods of varying
lengths throughout the term of the Subordinated Notes. During an Extension
Period, holders of Preferred Securities will be required to include deferred
interest income in their gross income in advance of receipt of the cash interest
payments attributable thereto. See "Description of the Subordinated Notes--
Option to Extend Interest Payment Period" and "Certain Federal Income Tax
Consequences--Original Issue Discount, Premium and Market Discount."
Redemption. The Subordinated Notes are redeemable by ComEd (in whole
or in part) from time to time, on or after September 30, 2000, or at any time in
certain circumstances upon the occurrence of a Tax Event. If the Subordinated
Notes are redeemed, the Trust must redeem Trust Securities having an aggregate
liquidation amount equal to the aggregate principal amount of Subordinated Notes
so redeemed. The Preferred Securities will be redeemed upon maturity of the
Subordinated Notes. See "Description of the Preferred Securities--Mandatory
Redemption."
RISK FACTORS
Prospective purchasers of Preferred Securities should carefully review
the information contained or incorporated by reference elsewhere in this
Prospectus and should particularly consider the following matters:
RANKING OF PREFERRED SECURITIES GUARANTEE AND SUBORDINATED NOTES
ComEd's obligations under the Preferred Securities Guarantee are
subordinate and junior in right of payment to all liabilities of ComEd and pari
passu with the most senior preferred stock now or hereafter issued by ComEd and
with any guarantee now or hereafter entered into by ComEd in respect of any
preferred stock of any affiliate of ComEd. The obligations of ComEd under the
Subordinated Notes are subordinate and junior in right of payment to all present
and future Senior Indebtedness (as defined herein) of ComEd. At June 30, 1995,
Senior Indebtedness of ComEd aggregated approximately $8,231 million. There are
no terms in the Preferred Securities, the Subordinated Notes or the Preferred
Securities Guarantee that limit ComEd's ability to incur additional
indebtedness, including indebtedness that ranks senior to the Subordinated Notes
or the Preferred Securities Guarantee. See "Description of the Preferred
Securities Guarantee" and "Description of the Subordinated Notes--
Subordination."
RIGHTS UNDER THE PREFERRED SECURITIES GUARANTEE
The Preferred Securities Guarantee guarantees to the holders of the
Preferred Securities the payment of (i) any accrued and unpaid distributions
which are required to be paid on the Preferred Securities, to the extent the
Trust shall have funds available therefor, (ii) the Redemption Price, including
all accrued and unpaid distributions, to the date of the redemption, to the
extent the Trust has funds available therefor, with respect to any Preferred
Securities called for redemption by the Trust and (iii) upon a voluntary or
involuntary dissolution, winding-up or termination of the Trust (other than in
connection with the distribution of Subordinated Notes to the holders of
Preferred Securities the lesser of (a) the aggregate of the liquidation amount
and all accrued and unpaid distributions on the Preferred Securities to the date
of payment therefor and (b) the amount of assets of the Trust
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remaining available for distribution to holders of Preferred Securities in
liquidation of the Trust. The holders of a majority in liquidation amount of
the Preferred Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Preferred Guarantee
Trustee (as defined herein) or to direct the exercise of any trust or power
conferred upon the Preferred Guarantee Trustee under the Preferred Securities
Guarantee. If the Preferred Guarantee Trustee fails to enforce the Preferred
Securities Guarantee, any holder of Preferred Securities may institute a legal
proceeding directly against ComEd to enforce the Preferred Guarantee Trustee's
rights under the Preferred Securities Guarantee, without first instituting a
legal proceeding against the Trust, the Preferred Guarantee Trustee or any other
person or entity. If ComEd were to default in its obligation to pay amounts
payable on the Subordinated Notes, the Trust would lack available funds for the
payment of distributions or amounts payable on redemption of the Preferred
Securities or otherwise, and in such event holders of the Preferred Securities
would not be able to rely upon the Preferred Securities Guarantee for payment of
such amounts. Instead, holders of the Preferred Securities would rely on the
enforcement by the Property Trustee (as defined herein) of its rights as
registered holder of the Subordinated Notes against ComEd, pursuant to the terms
of the Subordinated Notes. See "Description of the Preferred Securities
Guarantee -- Status of the Preferred Securities Guarantee" and "Description of
the Subordinated Notes -- Subordination." The Declaration (as defined herein)
provides that each holder of Preferred Securities by acceptance thereof agrees
to the provisions of the Preferred Securities Guarantee and the Indenture (as
defined herein).
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF PREFERRED SECURITIES
If a Declaration Event of Default (as defined herein) occurs and is
continuing, then the holders of Preferred Securities would rely on the
enforcement by the Property Trustee of its rights as a holder of the
Subordinated Notes against ComEd. In addition, the holders of a majority in
aggregate liquidation amount of the Preferred Securities will have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Property Trustee or to direct the exercise of any trust or
power conferred upon the Property Trustee under the Declaration, including the
right to direct the Property Trustee to exercise the remedies available to it as
a holder of the Subordinated Notes. If the Property Trustee fails to enforce
its rights under the Subordinated Notes, a 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 ComEd to enforce the Property Trustee's rights under the Subordinated
Notes without first instituting any legal proceeding against the Property
Trustee or any other person or entity, including the Trust.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
ComEd has the right under the Indenture to defer payments of interest
on the Subordinated Notes by extending the interest payment period at any time,
and from time to time, on the Subordinated Notes. As a consequence of such an
extension, quarterly distributions on the Preferred Securities would be deferred
(but despite such deferral would continue to accrue with interest thereon
compounded quarterly) by the Trust during any such extended interest payment
period. Such right to extend the interest payment period for the Subordinated
Notes is limited to a period not exceeding 20 consecutive quarters for any such
extension. In the event that ComEd exercises this right to defer payments of
interest, then (a) ComEd shall not declare or pay any dividend on, make any
distributions with respect to, or redeem, purchase or make a liquidation payment
with respect to, any of its capital stock, (b) ComEd shall not make any payment
of interest, principal or premium, if any, on or repay, repurchase or redeem any
debt securities (including guarantees) issued by ComEd which rank pari passu
with or junior to the Subordinated Notes and (c) ComEd shall not make any
guarantee payments with respect to the foregoing (other than pursuant to the
Preferred Securities Guarantee). Prior to the termination of any such Extension
Period, ComEd may further defer payments of interest by further extending the
interest payment period, provided that such Extension Period, together with all
such previous and further extensions thereof, may not exceed 20 consecutive
quarters or extend
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beyond the maturity of the Subordinated Notes. Upon the termination of any
Extension Period and the payment of all amounts then due, ComEd may select a new
Extension Period, as if no Extension Period had previously been declared,
subject to the above requirements. See "Description of the Preferred Securities
- -- Distributions" and "Description of the Subordinated Notes -- Option to Extend
Interest Payment Period."
Should ComEd exercise its rights to defer payments of interest by
extending the interest payment period, each holder of Preferred Securities will
continue to accrue income (as original issue discount) for United States federal
income tax purposes in respect of the deferred interest allocable to its
Preferred Securities. As a result, holders of Preferred Securities will
recognize income for United States federal income tax purposes in advance of the
receipt of cash and will not receive cash from the Trust related to such income
if such holder disposes of its Preferred Securities prior to the record date for
the date on which distributions of such amounts are made. ComEd has no current
intention of exercising its right to defer payments of interest by extending the
interest payment period on the Subordinated Notes. However, should ComEd
determine to exercise such right in the future, the market price of the
Preferred Securities is likely to be affected. A holder that disposes of its
Preferred Securities during an Extension Period, therefore, might not receive
the same return on its investment as a holder that continues to hold its
Preferred Securities. In addition, as a result of the existence of ComEd's
right to defer interest payments, the market price of the Preferred Securities
(which represent an undivided beneficial interest in the Subordinated Notes) may
be more volatile than other securities on which original issue discount accrues
that do not have such rights. See "Certain Federal Income Tax Consequences --
Original Issue Discount, Premium and Market Discount."
SPECIAL EVENT DISTRIBUTION
Upon the occurrence of a Special Event, the Trust will be dissolved,
except in the limited circumstances described below, with the result that the
Subordinated Notes would be distributed to the holders of the Trust Securities
in connection with the liquidation of the Trust. In the case of a Special Event
that is a Tax Event, in certain circumstances ComEd shall have the right to
redeem the Subordinated Notes, in whole or in part, in which event the Trust
will redeem the Trust Securities on a pro rata basis to the same extent as the
Subordinated Notes are redeemed. See "Description of the Preferred Securities -
- - Special Event Redemption or Distribution" and "Certain Federal Income Tax
Consequences."
There can be no assurance as to the market prices for the Preferred
Securities or the Subordinated Notes that may be distributed in exchange for
Preferred Securities if a dissolution or liquidation of the Trust were to occur.
Accordingly, the Preferred Securities that an investor may purchase, or the
Subordinated Notes that the investor may receive on dissolution and liquidation
of the Trust, may trade at a discount to the price that the investor paid to
purchase the Preferred Securities offered hereby. Because holders of Preferred
Securities may receive Subordinated Notes upon the occurrence of a Special
Event, prospective purchasers of Preferred Securities are also making an
investment decision with regard to the Subordinated Notes and should carefully
review all the information regarding the Subordinated Notes and ComEd contained
herein. See "Description of the Preferred Securities -- Special Event
Redemption or Distribution" and "Description of the Subordinated Notes."
LIMITED VOTING RIGHTS
Holders of Preferred Securities will have limited voting rights and
will not be entitled to vote to appoint, remove or replace, or to increase or
decrease the number of, ComEd Trustees (as defined herein), which voting rights
are vested exclusively in ComEd as the holder of the Common Securities.
-7-
<PAGE>
TRADING PRICE OF PREFERRED SECURITIES
The Preferred Securities may trade at a price that does not fully
reflect the value of accrued but unpaid interest with respect to the underlying
Subordinated Notes. A holder who disposes of his Preferred Securities between
record dates for payments of distributions thereon will be required to include
accrued but unpaid interest on the Subordinated Notes through the date of
disposition in income as ordinary income (i.e., OID (as defined herein)), and to
add such amount to his adjusted tax basis in his pro rata share of the
underlying Subordinated Notes deemed disposed of. To the extent the selling
price is less than the holder's adjusted tax basis (which will include, in the
form of OID, all accrued but unpaid interest), a holder will recognize a capital
loss. Subject to certain limited exceptions, capital losses cannot be applied
to offset ordinary income for United States federal income tax purposes. See
"Certain Federal Income Tax Consequences -- Original Issue Discount, Premium and
Market Discount" and "-- Sale of Preferred Securities."
COMMONWEALTH EDISON COMPANY
ComEd is engaged principally in the production, purchase,
transmission, distribution and sale of electricity to a diverse base of
residential, commercial and industrial customers. ComEd's electric service
territory has an area of approximately 11,540 square miles and an estimated
population of approximately 8.2 million as of December 31, 1994 and
approximately 8.1 million as of December 31, 1993. It includes the city of
Chicago, an area of about 225 square miles with an estimated population of three
million from which ComEd derived approximately one-third of its ultimate
consumer revenues in the twelve months ended June 30, 1995. ComEd had
approximately 3.4 million electric customers as of June 30, 1995. ComEd's
principal executive offices are located at 37th Floor, 10 South Dearborn Street,
Post Office Box 767, Chicago, Illinois 60690-0767, and its telephone number is
312/394-4321.
COMED FINANCING I
The Trust is a statutory business trust formed under Delaware law
pursuant to the filing of a certificate of trust with the Delaware Secretary of
State on July __, 1995. The Trust's business is defined in a Declaration of
Trust, executed by ComEd, as sponsor (the "Sponsor"), and the ComEd Trustees (as
defined herein). The Declaration of Trust will be amended and restated in its
entirety (as so amended and restated, the "Declaration") substantially in the
form filed as an exhibit to the Registration Statement of which this Prospectus
forms a part. The Declaration will be qualified as an indenture under the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"). Upon issuance of
the Preferred Securities, the purchasers thereof will own all of the Preferred
Securities. ComEd will acquire all of the Common Securities in an aggregate
liquidation amount equal to 3% of the total capital of the Trust. The Trust
exists for the exclusive purposes of (i) issuing the Trust Securities
representing undivided beneficial interests in the assets of the Trust, (ii)
investing the gross proceeds of the Trust Securities in the Subordinated Notes
and (iii) engaging in only those other activities necessary or incidental
thereto. The Trust has a term of approximately 45 years, but may terminate
earlier as provided in the Declaration.
The Trust's business and affairs will be conducted by the trustees
(the "ComEd Trustees") appointed by ComEd, as holder of the Common Securities.
The duties and obligations of the ComEd Trustees shall be governed by the
Declaration. Pursuant to the Declaration, the number of ComEd Trustees will
initially be three. Two of the ComEd Trustees (the "Regular Trustees") will be
persons who are employees or officers of, or affiliated with, ComEd. The third
trustee will be a financial institution unaffiliated with ComEd which maintains
a principal place of business in the State of Delaware that will serve as
property trustee under the Declaration and as indenture trustee for purposes of
the Trust Indenture Act (the "Property Trustee"). Wilmington Trust Company will
act as
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<PAGE>
the Property Trustee until removed or replaced by the holder of the Common
Securities. Wilmington Trust Company will also act as indenture trustee under
the Preferred Securities Guarantee (the "Preferred Guarantee Trustee"). See
"Description of the Preferred Securities Guarantee."
The Property Trustee will hold title to the Subordinated Notes for the
benefit of the holders of the Trust Securities and will have the power to
exercise all rights, powers and privileges under the Indenture (as defined
herein) as the holder of the Subordinated Notes. In addition, the Property
Trustee will maintain exclusive control of a segregated non-interest bearing
bank account (the "Property Account") to hold all payments made in respect of
the Subordinated Notes for the benefit of the holders of the Trust Securities.
The Property Trustee will make payments of distributions and payments on
liquidation, redemption and otherwise to the holders of the Trust Securities out
of funds from the Property Account. The Preferred Guarantee Trustee will hold
the Preferred Securities Guarantee for the benefit of the holders of the
Preferred Securities. ComEd, as the holder of all the Common Securities, will
have the right to appoint, remove or replace any ComEd Trustee and to increase
the number of ComEd Trustees, provided that the number of ComEd Trustees shall
be at least three, a majority of which shall be Regular Trustees. ComEd will
pay all fees and expenses related to the Trust, the offering of the Trust
Securities and the issuance of the Subordinated Notes. See "Description of the
Subordinated Notes -- Miscellaneous."
The rights of the holders of the Preferred Securities, including
economic rights, rights to information and voting rights, are as set forth in
the Declaration, the Delaware Business Trust Act, as amended (the "Trust Act"),
and the Trust Indenture Act. See "Description of the Preferred Securities."
The Trustee in the State of Delaware is Wilmington Trust Company,
Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890. The
principal place of business of the Trust shall be c/o Commonwealth Edison
Company, 37th Floor, 10 South Dearborn Street, Chicago, Illinois 60690-0767
(telephone number 312/394-4321).
SELECTED FINANCIAL INFORMATION
The following information is qualified in its entirety by the
information appearing elsewhere in this Prospectus and by the information and
financial statements incorporated in this Prospectus by reference.
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<PAGE>
COMMONWEALTH EDISON COMPANY
<TABLE>
<S> <C>
Estimated Population of Service Area....................................... 8,200,000
Customers (as of June 30, 1995)............................................ 3,368,000
Sales (thousands of kilowatthours--12 months ended June 30, 1995).......... 89,134,000
Net Electric Generating Capability, net of summer limitations (kilowatts).. 21,965,000
Fuel Sources of Kilowatthour Generation (12 months ended June 30, 1995):
Nuclear............................................................... 74%
Coal.................................................................. 23
Oil................................................................... 1
Natural gas........................................................... 2
---
100%
---
</TABLE>
FINANCIAL INFORMATION
<TABLE>
<CAPTION>
TWELVE
MONTHS
YEAR ENDED DECEMBER 31 ENDED
----------------------------------------------------------------------- (UNAUDITED)
JUNE 30,
1990(B) 1991(B) 1992(B) 1993(A)(B) 1994(A)(B) 1995(C)
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Electric Operating $5,310,819 $6,275,533 $6,026,321 $5,260,440 $6,277,521 $6,458,276
Revenues (thousands (1) (1) (1) (2) (2)
of dollars)
Net Income (thousands $ 128,291 $ 94,887 $ 513,981 $ 112,440 $ 423,946 $ 614,661
of dollars) (3)
Net Income on Common $ 45,796 $ 16,599 $ 443,442 $ 46,388 $ 359,019 $ 546,988
Stock (thousands (3)
of dollars)
Earnings per Common $ 0.22 $ 0.08 $ 2.08 $ 0.22 $ 1.68 $ 2.55
Share (3)
Ratios of Earnings to-
Fixed Charges (D) 1.42 1.59 2.06 1.19 1.99 2.47
Fixed Charges and 1.21 1.36 1.78 1.03 1.73 2.13
Preferred and
Preference Stock
Dividend Require-
ments (D)
- --------------------------
</TABLE>
See Notes (A) through (D) on pages 11 through 13.
(1) Reflects provisions for revenue refunds of $536.4 million, $0.9 million and
$18.4 million for the years ended December 31, 1990, 1991 and 1992,
respectively, relating to the Illinois Supreme Court's ("Supreme Court")
reversal of the Illinois Commerce Commission's ("ICC") 1988 rate order and
the Supreme Court's decision regarding Byron Unit 1.
(2) Reflects provisions for revenue refunds of $1,281 million and $16 million
for the years ended December 31, 1993 and 1994, respectively, recording the
effects of two settlements related to various proceedings and matters
concerning ComEd's rates and its fuel adjustment clause. See Note A for
additional information.
(3) In January 1993, ComEd adopted an accounting standard which requires an
asset and liability approach for financial accounting and reporting for
income taxes as opposed to the deferred method that ComEd had previously
used. ComEd adopted the standard as a cumulative effect
-10-
<PAGE>
of a change in an accounting principle, which increased net income and net
income on common stock for the year ended December 31, 1993 by $9.7 million
or $0.05 per common share.
NOTES TO FINANCIAL INFORMATION:
(A) In November 1993, two settlements related to various proceedings and
matters concerning ComEd's rates and its fuel adjustment clause became
final. One settlement (the "Rate Matters Settlement") concerned the
proceedings relating to ComEd's 1985 and 1991 ICC rate orders (which orders
related to, among other things, the recovery of costs associated with
ComEd's four most recently completed nuclear generating units, Byron Units
1 and 2 and Braidwood Units 1 and 2), the proceedings concerning the
reduction in the difference between ComEd's summer and non-summer
residential rates that was effected in the summer of 1988, outstanding
issues related to the appropriate interest rate and rate design to be
applied to a refund made by ComEd during 1990 related to a 1988 ICC rate
order, and matters related to a rider to ComEd's rates that it was required
to file as a result of the change in the federal corporate income tax rate
made by the Tax Reform Act of 1986. The other settlement (the "Fuel
Matters Settlement") related to the ICC fuel reconciliation proceedings
involving ComEd for the period from 1985 through 1988 and to future
challenges by the settling parties to the prudence of ComEd's western coal
costs for the period from 1989 through 1992.
Under the Rate Matters Settlement, effective as of November 4, 1993, ComEd
reduced its rates by approximately $339 million annually and commenced
refunding approximately $1.26 billion (including revenue taxes), plus
interest at five percent on the unpaid balance, through temporarily reduced
rates over an initial refund period which ended in November 1994 (followed
by a reconciliation period of five months). ComEd had previously deferred
the recognition of revenues during 1993 as a result of developments in the
proceedings related to the 1991 ICC rate order, which resulted in a
reduction to 1993 net income of approximately $160 million or $0.75 per
common share. The recording of the effects of the Rate Matters Settlement
in October 1993 reduced 1993 net income by approximately $292 million or
$1.37 per common share, in addition to the approximately $160 million
effect of the deferred recognition of revenues and after the partially
offsetting effect of recording approximately $269 million or $1.26 per
common share in deferred carrying charges, net of income taxes, authorized
in the ICC rate order issued on January 6, 1993 (as subsequently modified,
the "Remand Order"). The deferred recognition of revenues was eliminated
in October 1993 at the time the provisions for revenue refunds related to
the Rate Matters Settlement, which reflected those deferred revenues, were
recorded.
Under the Fuel Matters Settlement, effective as of December 2, 1993, ComEd
commenced paying approximately $108 million (including revenue taxes) to
its customers through temporarily reduced collections under its fuel
adjustment clause over a twelve-month period which ended in November 1994.
The recording of the effects of the Fuel Matters Settlement in October 1993
reduced 1993 net income by approximately $62 million or $0.29 per common
share.
(B) During the periods presented under the subcaption "Financial Information"
in "Selected Financial Information," ComEd's revenues, net income, cash
flows, plant carrying costs, ratios of earnings to fixed charges and ratios
of earnings to fixed charges and preferred and preference stock dividend
requirements were affected directly by the proceedings that are the subject
of the Rate Matters Settlement and the Fuel Matters Settlement. The
uncertainties associated with such proceedings and related issues, among
other things, led to the Rate Matters Settlement and the Fuel Matters
Settlement. See Note A for additional information.
-11-
<PAGE>
The Illinois Public Utilities Act requires the ICC to hold annual public
hearings to determine whether each utility's fuel adjustment clause
reflects actual costs of fuel and power prudently purchased and to
reconcile amounts collected with actual costs. Through its fuel adjustment
clause, ComEd recovers from its customers the cost of the fuel used to
generate electricity and of purchased power as compared to fuel costs
included in base rates.
ComEd is currently involved in proceedings relating to the amounts
collected under its fuel adjustment clause with respect to 1993. ICC
orders have been issued in fuel reconciliation proceedings for years prior
to 1993; however, certain intervenors have appealed the ICC order in the
1989 fuel reconciliation proceedings on issues relating to nuclear station
performance. Under the Fuel Matters Settlement, parties to the settlement
agreed not to challenge the prudence of ComEd's western coal costs for the
period from 1989 through 1992. ComEd's western coal contracts and its rail
contracts for delivery of the western coal were renegotiated during 1992
effective as of January 1, 1993, to provide, among other things, for
significant reductions in the delivered price of the coal over the duration
of the contracts. However, the renegotiated contracts provide for the
purchase of certain coal at prices substantially above currently prevailing
market prices and ComEd has substantial purchase commitments under its
contracts. For additional information relating to ComEd's commitments for
the purchase of coal, see "Management's Discussion and Analysis of
Financial Condition and Results of Operations," subcaption "Liquidity and
Capital Resources," and Notes 1 and 19 of Notes to Financial Statements in
the March 31, 1995 Form 10-Q Report.
(C) On January 9, 1995, the ICC issued its rate order (the "Rate Order") in the
proceedings relating to ComEd's February 10, 1994 rate increase request.
The Rate Order provides, among other things, for (i) an increase in ComEd's
total revenues of approximately $301.8 million (excluding add-on revenue
taxes) or 5.2%, on an annual basis, including a $303.2 million increase in
base rates, (ii) the collection of municipal franchise costs as an adder to
base rates until May 1, 1995, when ComEd began collecting such costs
prospectively on an individual municipality basis through a rider, and
(iii) the use of a rider, with annual review proceedings, to pass on to
ratepayers increases or decreases in estimated costs associated with the
decommissioning of ComEd's nuclear generating units. The rates provided in
the Rate Order became effective on January 14, 1995; however, they are
being collected subject to refund as a result of subsequent judicial
action. Intervenors and ComEd have filed appeals of the Rate Order with
the Illinois Appellate Court. Electric operating revenues of approximately
$139 million (excluding revenue taxes) are subject to refund.
In the Rate Order, the ICC also determined that Byron Unit 2 and Braidwood
Units 1 and 2 were 100% "used and useful" and that the previously
determined reasonable costs of such Units, as depreciated, should be
included in full in ComEd's rate base. The ICC also determined, however,
that ComEd's annual nuclear plant decommissioning cost collections from its
ratepayers should be reduced from the $127 million previously authorized in
the 1991 ICC rate order to $112.7 million. The $112.7 million annual
collection amount primarily resulted from the ICC's decision to exclude
from ComEd's costs subject to collection a contingency allowance. As noted
above, the Rate Order established a rider which allows annual adjustments
to decommissioning cost collections outside of the context of a traditional
rate proceeding. Such rider is intended to allow adjustments in
decommissioning cost recoveries from ratepayers as changes in cost
estimates become identifiable. On April 19, 1995, the ICC approved ComEd's
initial rider filing, which increased its annual collections to $113.5
million. Under Illinois law, decommissioning cost collections are required
to be deposited in external trust funds; and, consequently, such
collections do not add to the cash flows available for general corporate
purposes.
-12-
<PAGE>
(D) For purposes of computing the ratios of earnings to fixed charges and the
ratios of earnings to fixed charges and preferred and preference stock
dividend requirements: (i) earnings consist of net income before deducting
net provisions for income taxes (including deferred taxes and current
income taxes applicable to nonoperating activities), investment tax credits
deferred and fixed charges; (ii) fixed charges consist of interest on debt,
amortization of debt discount, premium and expense, and the estimated
interest component of nuclear fuel and other lease payments and rentals;
and (iii) preferred and preference stock dividend requirements represent an
amount equal to income, before income taxes, which would be required to
meet the dividends on preferred and preference stocks.
CAPITALIZATION OF COMED
The following table sets forth the unaudited consolidated
capitalization including short-term borrowings and current maturities of ComEd
at June 30, 1995, and as adjusted to reflect the sale of the Preferred
Securities offered hereby and the application of the estimated net proceeds from
such sale. See "Use of Proceeds." The table should be read in conjunction with
ComEd's consolidated financial statements and notes thereto included in the
documents incorporated by reference herein. See "Incorporation of Certain
Documents by Reference."
<TABLE>
<CAPTION>
At June 30, 1995
-----------------
(Unaudited)
Actual As Adjusted
------- -----------
(Dollars in Millions)
<S> <C> <C>
Short-term borrowings.............................. $ 47 $ 7
Long-term borrowings including current maturities.. 7,559 7,399
Company-obligated preferred securities
of subsidiary trust (1)........................... -- 200
Preferred and preference stocks without mandatory
redemption requirements........................... 508 508
Preference stock subject to mandatory redemption
requirements including current maturities......... 307 307
Common stock equity................................ 5,431 5,431
------- -------
Total capitalization including
short-term borrowings and current maturities...... $13,852 $13,852
======= =======
</TABLE>
________________________
(1) As described in this Prospectus, the sole asset of the Trust will be the
____% Subordinated Deferrable Interest Notes due 2035 of ComEd with a
principal amount of $ ________ and upon redemption of such debt, the
Preferred Securities will be mandatorily redeemable.
ACCOUNTING TREATMENT
The financial statements of the Trust will be consolidated with
ComEd's financial statements, with the Preferred Securities shown on ComEd's
consolidated financial statements as Company-obligated preferred securities of
subsidiary trust.
-13-
<PAGE>
USE OF PROCEEDS
The proceeds of the sale of the Preferred Securities will be invested
by the Trust in the Subordinated Notes of ComEd. ComEd will use the net
proceeds from the sale of such Subordinated Notes to pay approximately $140
million of short-term commercial paper notes issued to discharge previously
outstanding long-term debt and to pay approximately $60 million on an
outstanding bank loan. The commercial paper bears interest at rates ranging
from 5.89% to 6.13% and the bank loan bears interest at a variable rate of
interest (currently approximately 6 1/2%). See "Capitalization of ComEd." For
additional information concerning ComEd's outstanding long-term debt, see the
Statements of Consolidated Capitalization in the March 31, 1995 Form 10-Q
Report.
DESCRIPTION OF THE PREFERRED SECURITIES
The Preferred Securities will be issued pursuant to the terms of the
Declaration. The Declaration will be qualified as an indenture under the Trust
Indenture Act. The Property Trustee will act as the indenture trustee for
purposes of compliance with the provisions of the Trust Indenture Act. The
terms of the Preferred Securities will include those stated in the Declaration
and those made part of the Declaration by the Trust Indenture Act. The
following summary of the principal terms and provisions of the Preferred
Securities does not purport to be complete and is subject to, and qualified in
its entirety by reference to, the Declaration, a copy of which is filed as an
exhibit to the Registration Statement, of which this Prospectus is a part, the
Trust Act and the Trust Indenture Act.
GENERAL
The Declaration authorizes the Regular Trustees, on behalf of the
Trust, to issue the Preferred Securities, which represent preferred undivided
beneficial interests in the assets of the Trust, and the Common Securities,
which represent common undivided beneficial interests in the assets of the
Trust. All of the Common Securities will be owned by ComEd. The Common
Securities rank pari passu, and payments will be made thereon on a pro rata
basis, with the Preferred Securities, except that upon the occurrence and during
the continuation of a Declaration Event of Default, the rights of the holders of
the Common Securities to receive payment of periodic distributions and payments
upon liquidation, redemption and otherwise will be subordinated to the rights to
payment of the holders of the Preferred Securities. The Declaration does not
permit the issuance by the Trust of any securities other than the Trust
Securities or the incurrence of any indebtedness by the Trust. Pursuant to the
Declaration, the Property Trustee will own and hold the Subordinated Notes for
the benefit of the holders of the Trust Securities. The payment of
distributions out of money held by the Trust, and payments upon redemption of
the Preferred Securities or liquidation of the Trust, are guaranteed by ComEd to
the extent described under "Description of the Preferred Securities Guarantee."
The Preferred Guarantee Trustee will hold the Preferred Securities Guarantee for
the benefit of the holders of the Preferred Securities. The Preferred
Securities Guarantee does not cover payment of distributions on the Preferred
Securities when the Trust does not have sufficient available funds in the
Property Account to make such distributions.
DISTRIBUTIONS
Distributions on the Preferred Securities will be fixed at a rate per
annum of __% of the stated liquidation amount of $25 per Preferred Security.
Distributions in arrears will bear interest at the rate of __% per annum (to the
extent permitted by applicable law). The term "distributions" as used herein
includes any such interest payable unless otherwise stated.
Distributions on the Preferred Securities will be cumulative, will
accrue from _______ __, 1995 and will be payable quarterly in arrears on
March 31, June 30, September 30 and December 31 of each year to the holders of
record on the applicable record date, commencing
-14-
<PAGE>
September 30, 1995 when, as and if available for payment by the Property
Trustee, except as otherwise described below. The amount of distributions
payable for any full quarterly period will be computed on the basis of a 360-day
year of twelve 30-day months, and for any period shorter than a full quarter, on
the basis of the actual number of days elapsed in such a 90-day quarter.
ComEd has the right under the Indenture to defer payments of interest
on the Subordinated Notes by extending the interest payment period from time to
time on the Subordinated Notes which, if exercised, would defer quarterly
distributions on the Preferred Securities (though such distributions would
continue to accrue interest since interest would continue to accrue on the
Subordinated Notes) during any such extended interest payment period. In the
event that ComEd exercises this right, then (a) ComEd shall not declare or pay
any dividend on, make any distributions with respect to, or redeem, purchase or
make a liquidation payment with respect to, any of its capital stock, (b) ComEd
shall not make any payment of interest, principal or premium, if any, on or
repay, repurchase or redeem any debt securities (including guarantees) issued by
ComEd which rank pari passu with or junior to the Subordinated Notes, and (c)
ComEd shall not make any guarantee payments with respect to the foregoing (other
than pursuant to the Preferred Securities Guarantee). Prior to the termination
of any such Extension Period, ComEd may further extend the interest payment
period, provided that such Extension Period, together with all such previous and
further extensions thereof, may not exceed 20 consecutive quarters or extend
beyond the maturity of the Subordinated Notes. Upon the termination of any
Extension Period and the payment of all amounts then due, ComEd may select a new
Extension Period as if no Extension Period had previously been declared, subject
to the above requirements. See "Description of the Subordinated Notes --
Interest" and "-- Option to Extend Interest Payment Period." If distributions
are deferred, the deferred distributions and accrued interest thereon shall be
paid to holders of record of the Preferred Securities, if funds are available
therefor, as they appear on the books and records of the Trust on the record
date next following the termination of such Extension Period.
Distributions on the Preferred Securities must be paid on the dates
payable to the extent that the Trust has funds available for the payment of such
distributions in the Property Account. The Trust's funds available for
distribution to the holders of the Preferred Securities will be limited to
payments received under the Subordinated Notes. See "Description of the
Subordinated Notes." The payment of distributions out of moneys held by the
Trust is guaranteed by ComEd to the extent set forth under "Description of the
Preferred Securities Guarantee."
Distributions on the Preferred Securities will be payable to the
holders thereof as they appear on the books and records of the Trust on the
relevant record dates, which, as long as the Preferred Securities remain in
book-entry only form, will be one Business Day (as defined herein) prior to the
relevant payment dates, which payment dates correspond to the interest payment
dates on the Subordinated Notes. Such distributions will be paid through the
Property Trustee, who will hold amounts received in respect of the Subordinated
Notes in the Property Account for the benefit of the holders of the Trust
Securities. Subject to any applicable laws and regulations and the provisions
of the Declaration, each such payment will be made as described under "-- Book-
Entry Only Issuance --The Depository Trust Company" below. In the event the
Preferred Securities shall not continue to remain in book-entry only form, the
Regular Trustees shall have the right to select relevant record dates which
shall be at least one Business Day, but less than 60 Business Days, prior to the
relevant payment dates. In the event that any date on which distributions are
to be made on the Preferred Securities is not a Business Day, then payment of
the distributions 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. A
"Business Day" shall mean any day other than a day on which banking institutions
in Wilmington, Delaware or New York, New York are authorized or required by law
to close.
-15-
<PAGE>
MANDATORY REDEMPTION
The Subordinated Notes will mature on September 30, 2035 and may be
redeemed, in whole or in part, at any time on or after September 30, 1995, or at
any time in certain circumstances upon the occurrence of a Tax Event. Upon the
repayment of the Subordinated Notes, whether at maturity or upon acceleration,
redemption or otherwise, the proceeds from such repayment or payment shall
simultaneously be applied to redeem Trust Securities having an aggregate
liquidation amount equal to the aggregate principal amount of the Subordinated
Notes so repaid or redeemed at the Redemption Price; provided that, except in
the case of payments upon maturity, holders of Trust Securities shall be given
not less than 30 nor more than 60 days notice of such redemption. See
"Description of the Subordinated Notes." In the event that fewer than all of
the outstanding Preferred Securities are to be redeemed, the Preferred
Securities will be redeemed pro rata as described under "-- Book-Entry Only
Issuance -- The Depository Trust Company" below.
SPECIAL EVENT REDEMPTION OR DISTRIBUTION
"Tax Event" means that the Regular Trustees shall have received an
opinion from independent tax counsel experienced in such matters (a "Dissolution
Tax Opinion") to the effect that, on or after the date of this Prospectus, 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 by any legislative body, court, governmental agency or regulatory
authority, which amendment or change is enacted, promulgated, issued or
announced or which interpretation or pronouncement is issued or announced or
which action is taken, in each case on or after the date of this Prospectus,
there is more than an insubstantial risk that (i) the Trust would be subject to
United States federal income tax with respect to interest accrued or received on
the Subordinated Notes, (ii) interest payable to the Trust on the Subordinated
Notes would not be deductible in whole or in part by ComEd 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, which
change or amendment becomes effective on or after the date of this Prospectus.
"Investment Company Event" means that the Regular Trustees shall have
received an opinion from independent counsel experienced in practice under the
1940 Act (as hereinafter defined) to the effect that, as a result of the
occurrence of a change in law or regulation or a written change in
interpretation or application of law or regulation by any legislative body,
court, governmental agency or regulatory authority (a "Change in 1940 Act Law"),
there is more than an insubstantial risk that the Trust is or will be considered
an "investment company" which is required to be registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), which Change in 1940 Act Law
becomes effective on or after the date of this Prospectus.
If, at any time, a Tax Event or an Investment Company Event (each, as
defined above, a "Special Event") shall occur and be continuing, the Trust
shall, except in the circumstances described below, be dissolved with the result
that Subordinated Notes with an aggregate principal amount equal to the
aggregate stated liquidation amount of, with an interest rate identical to the
distribution rate of, and accrued and unpaid interest equal to accrued and
unpaid distributions on, the Trust Securities would be distributed to the
holders of the Trust Securities, in liquidation of such holders' interests in
the Trust on a pro rata basis, within 90 days following the occurrence of such
Special Event; provided, however, that in the case of the occurrence of a Tax
Event, as a condition of such dissolution and distribution, the Regular Trustees
shall have received an opinion from independent tax counsel experienced in such
matters (a "No Recognition Opinion"), which opinion may rely on published
revenue rulings of the Internal Revenue Service, to the effect that the holders
of the Trust Securities will not recognize any gain or loss for United States
federal income tax purposes as a result of such dissolution of the Trust and the
distribution of the Subordinated Notes; and, provided, further, that,
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if at the time there is available to the Trust the opportunity to eliminate,
within such 90-day period, the Special Event by taking some ministerial action,
such as filing a form or making an election, or pursuing some other similar
reasonable measure, which has no adverse effect on the Trust, ComEd or the
holders of the Trust Securities, the Trust will pursue such measure in lieu of
dissolution. Furthermore, if in the case of the occurrence of a Tax Event, (i)
ComEd has received an opinion (a "Redemption Tax Opinion") from independent tax
counsel experienced in such matters that, as a result of a Tax Event, there is
more than an insubstantial risk that ComEd would be precluded from deducting the
interest on the Subordinated Notes for United States federal income tax purposes
even after the Subordinated Notes were distributed to the holders of Trust
Securities in liquidation of such holders' interests in the Trust as described
above or (ii) the Regular Trustees shall have been informed by such tax counsel
that a No Recognition Opinion cannot be delivered, ComEd shall have the right,
upon not less than 30 nor more than 60 days notice, to redeem the Subordinated
Notes in whole or in part for cash within 90 days following the occurrence of
such Tax Event, and, following such redemption, Trust Securities with an
aggregate liquidation amount equal to the aggregate principal amount of the
Subordinated Notes 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 ComEd or the Trust the opportunity to eliminate, within such 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 which
has no adverse effect on the Trust, ComEd or the holders of the Trust
Securities, ComEd or the Trust will pursue such measure in lieu of redemption.
If Subordinated Notes are distributed to the holders of the Preferred
Securities, ComEd will use its best efforts to have the Subordinated Notes
listed on the New York Stock Exchange or on such other exchange as the Preferred
Securities are then listed.
After the date for any distribution of Subordinated Notes upon
dissolution of the Trust, (i) the Preferred Securities and Preferred Securities
Guarantee will no longer be deemed to be outstanding, (ii) the depositary or its
nominee, as the record holder of the Preferred Securities, will receive a
registered global certificate or certificates representing the Subordinated
Notes to be delivered upon such distribution and (iii) any certificates
representing Preferred Securities and Preferred Securities Guarantee not held by
the depositary or its nominee will be deemed to represent Subordinated Notes
having an aggregate principal amount equal to the aggregate stated liquidation
amount of, with an interest rate identical to the distribution rate of, and
accrued and unpaid interest equal to accrued and unpaid distributions on, such
Preferred Securities, until such certificates are presented to ComEd or its
agent for transfer or reissuance.
There can be no assurance as to the market prices for the Preferred
Securities or the Subordinated Notes that may be distributed in exchange for the
Preferred Securities if a dissolution and liquidation of the Trust were to
occur. Accordingly, the Preferred Securities that an investor may purchase, or
the Subordinated Notes that the investor may receive on dissolution and
liquidation of the Trust, may trade at a discount to the price that the investor
paid to purchase the Preferred Securities offered hereby.
REDEMPTION PROCEDURES
The Trust may not redeem fewer than all of the outstanding Preferred
Securities unless all accrued and unpaid distributions have been paid on all
Trust Securities for all quarterly distribution periods terminating on or prior
to the date of redemption.
If the Trust gives a notice of redemption in respect of Preferred
Securities (which notice will be irrevocable), then, by 12:00 noon, New York
City time, on the redemption date, provided that ComEd has paid to the Property
Trustee a sufficient amount of cash in connection with the related redemption or
maturity of the Subordinated Notes, the Trust will irrevocably deposit with the
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depositary funds sufficient to pay the applicable Redemption Price and will give
the depositary irrevocable instructions and authority to pay the Redemption
Price to the holders of the Preferred Securities. See "-- Book-Entry Only
Issuance -- The Depository Trust Company." If notice of redemption shall have
been given and funds deposited as required, then immediately prior to the close
of business on the date of such deposit, distributions will cease to accrue and
all rights of holders of such Preferred Securities so called for redemption will
cease, except the right of the holders of such Preferred Securities to receive
the Redemption Price, but without interest on such Redemption Price. In the
event that any date fixed for redemption of Preferred Securities is not a
Business Day, then payment of the Redemption Price 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 falls in the next calendar year, such payment will be made on the
immediately preceding Business Day. In the event that payment of the Redemption
Price in respect of Preferred Securities is improperly withheld or refused and
not paid either by the Trust or by ComEd pursuant to the Preferred Securities
Guarantee, distributions on such Preferred 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 calculating the Redemption Price.
In the event that fewer than all of the outstanding Preferred
Securities are to be redeemed, the Preferred Securities will be redeemed pro
rata as described under "-- Book-Entry Only Issuance -- The Depository Trust
Company" below.
Subject to the foregoing and to applicable law (including, without
limitation, United States federal securities laws), ComEd or its affiliates may,
at any time and from time to time, purchase outstanding Preferred Securities by
tender, in the open market or by private agreement.
LIQUIDATION DISTRIBUTION UPON DISSOLUTION
In the event of any voluntary or involuntary dissolution, winding-up
or termination of the Trust, the holders of the Preferred Securities at that
time will be entitled to receive out of the assets of the Trust, after
satisfaction of liabilities to creditors, distributions in an amount equal to
the aggregate of the stated liquidation amount of $25 per Preferred Security
plus accrued and unpaid distributions thereon to the date of payment (the
"Liquidation Distribution"), unless, in connection with such dissolution,
winding-up or termination, Subordinated Notes in an aggregate principal amount
equal to the aggregate stated liquidation amount of, with an interest rate
identical to the distribution rate of, and accrued and unpaid interest equal to
accrued and unpaid distributions on, the Preferred Securities have been
distributed on a pro rata basis to the holders of Preferred Securities in
exchange for such Preferred 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 Preferred Securities shall be paid on a pro rata basis. The
holders of the Common Securities will be entitled to receive distributions upon
any such dissolution pro rata with the holders of the Preferred Securities,
except that if a Declaration Event of Default has occurred and is continuing,
the Preferred Securities shall have a preference over the Common Securities.
Pursuant to the Declaration, the Trust shall terminate (i) on
________, the expiration of the term of the Trust, (ii) upon the bankruptcy of
ComEd, (iii) upon the filing of a certificate of dissolution or its equivalent
with respect to ComEd, the filing of a certificate of cancellation with respect
to the Trust, or the revocation of the charter of ComEd and the expiration of 90
days after the date of revocation without a reinstatement thereof, (iv) upon the
distribution of the Subordinated Notes
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following the occurrence of a Special Event, (v) upon the entry of a decree of a
judicial dissolution of ComEd or the Trust or (vi) upon the redemption of all of
the Trust Securities.
DECLARATION EVENTS OF DEFAULT
An event of default under the Indenture (an "Indenture Event of
Default") (see "Description of the Subordinated Notes -- Indenture Events of
Default") constitutes an event of default under the Declaration with respect to
the Trust Securities (a "Declaration Event of Default"), provided that pursuant
to the Declaration, the holder of the Common Securities will be deemed to have
waived any Declaration Event of Default with respect to the Common Securities or
its consequences until all Declaration Events of Default with respect to the
Preferred Securities have been cured, waived or otherwise eliminated. Until
such Declaration Events of Default with respect to the Preferred Securities 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 with respect to certain matters under the Declaration, and
therefore the Indenture.
Upon the occurrence of a Declaration Event of Default, the Property
Trustee, as the sole holder of the Subordinated Notes, will have the right under
the Indenture to declare the principal of, and interest on, the Subordinated
Notes to be immediately due and payable.
VOTING RIGHTS
Except as provided below, under the Trust Act, the Trust Indenture Act
and under "Description of the Preferred Securities Guarantee -- Amendments and
Assignment" and as otherwise required by law and the Declaration, the holders of
the Preferred Securities will have no voting rights.
The holders of a majority in aggregate liquidation amount of the
Preferred Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Property Trustee, or
to direct the exercise of any trust or power conferred upon the Property Trustee
under the Declaration, including the right to direct the Property Trustee, as
the holder of the Subordinated Notes, to (i) direct the time, method and place
of conducting any proceeding for any remedy available to the Debt Trustee (as
hereinafter defined) under the Indenture with respect to the Subordinated Notes,
(ii) waive any past Indenture Event of Default which is waivable under the Base
Indenture (as defined herein), (iii) exercise any right to rescind or annul a
declaration that the principal of all the Subordinated Notes shall be due and
payable, or (iv) consent to any amendment, modification or termination of the
Indenture or the Subordinated Notes, where such consent shall be required,
provided that where a consent under the Indenture would require the consent of
more than a majority of the holders in principal amount of Subordinated Notes
affected thereby (a "Super-Majority"), only 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 Subordinated
Notes, may direct the Property Trustee to give such consent. If the Property
Trustee fails to enforce its rights under the Declaration, a 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 any legal proceeding against the
Property Trustee or any other person or entity. The Property Trustee shall
notify all holders of the Preferred Securities of any notice of default received
from the Debt Trustee with respect to the Subordinated Notes. Such notice shall
state that such Indenture Event of Default also constitutes a Declaration Event
of Default. The Property Trustee shall not take any action described in clauses
(i), (ii), (iii) or (iv) above unless the Property Trustee has obtained an
opinion of independent tax counsel to the effect that, as a result of such
action, the Trust will not be classified as other than a grantor trust for
United States federal
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income tax purposes and each holder of Trust Securities will be treated as
owning an undivided beneficial interest in the Subordinated Notes.
In the event the consent of the Property Trustee, as the holder of the
Subordinated Notes, is required under the Indenture with respect to any
amendment, modification or termination of the Indenture, the Property Trustee
shall request the direction of the holders of the Trust Securities with respect
to such amendment, modification or termination. The Property Trustee shall vote
with respect to such amendment, modification or termination as directed by a
majority in liquidation amount of the Preferred Securities and, if no
Declaration Event of Default has occurred and is continuing, a majority in
liquidation amount of the Common Securities, voting together as separate
classes, provided that where a consent under the Indenture would require the
consent of 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 Preferred Securities and Common Securities, respectively, which the relevant
Super-Majority represents of the aggregate principal amount of the Subordinated
Notes outstanding. The Property Trustee shall not take any such action in
accordance with the directions of the holders of the Trust Securities unless the
Property Trustee has obtained an opinion of independent tax counsel to the
effect that, as a result of such action, the Trust will not be classified as
other than a grantor trust for United States federal income tax purposes.
A waiver of an Indenture Event of Default will constitute a waiver of
the corresponding Declaration Event of Default.
Any required approval or direction of holders of Preferred Securities
may be given at a separate meeting of holders of Preferred Securities convened
for such purpose, at a meeting of all of the holders of Trust Securities 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
Preferred Securities will be required for the Trust to redeem and cancel
Preferred Securities or distribute Subordinated Notes in accordance with the
Declaration.
Notwithstanding that holders of Preferred Securities are entitled to
vote or consent under any of the circumstances described above, any of the
Preferred Securities at such time that are owned by ComEd or any entity directly
or indirectly controlling or controlled by, or under direct or indirect common
control with, ComEd shall not be entitled to vote or consent and shall, for
purposes of such vote or consent, be treated as if they were not outstanding.
The procedures by which holders of Preferred Securities may exercise
their voting rights are described below. See "-- Book-Entry Only Issuance --
The Depository Trust Company."
Holders of the Preferred Securities will have no rights to appoint or
remove the ComEd Trustees, who may be appointed, removed or replaced solely by
ComEd, as the direct or indirect holder of all the Common Securities.
MODIFICATION OF THE DECLARATION
The Declaration may be amended or modified if approved and executed by
a majority of the Regular Trustees, provided that if any proposed amendment
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 Trust Securities, whether by way of amendment to the Declaration or
otherwise
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or (ii) the dissolution, winding-up or termination of the Trust other than
pursuant to the terms of the Declaration, then the holders of the Trust
Securities as a single 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 at least 66-2/3 in liquidation amount of the Trust Securities
affected thereby, provided that a reduction of the principal amount or the
distribution rate, or a change in the payment dates or maturity of the Preferred
Securities, shall not be permitted without the consent of each holder of
Preferred Securities. In the event any amendment or proposal referred to in
clause (i) above would adversely affect only the Preferred Securities or 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 Trust
Securities.
Notwithstanding the foregoing, no amendment or modification may be
made to the Declaration if such amendment or modification would (i) cause the
Trust to be classified for purposes of United States federal income taxation as
other than a grantor trust, (ii) reduce or otherwise adversely affect the powers
of the Property Trustee or (iii) cause the Trust to be deemed to be an
"investment company" which is required to be registered under the 1940 Act.
MERGERS, CONSOLIDATIONS OR AMALGAMATIONS
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 below. The Trust may, with the consent of a majority of the Regular
Trustees and without the consent of the holders of the Trust Securities,
consolidate, amalgamate, merge with or into, or be replaced by a trust organized
as such under the laws of any State; provided, that (i) such successor entity
either (x) expressly assumes all of the obligations of the Trust with respect to
the Trust Securities or (y) substitutes for the Trust Securities other
securities having substantially the same terms as the Trust Securities (the
"Successor Securities") so long as the Successor Securities rank the same as the
Trust Securities rank in priority with respect to distributions and payments
upon liquidation, redemption, maturity and otherwise, (ii) ComEd expressly
acknowledges a trustee of such successor entity which possesses the same powers
and duties as the Property Trustee as the holder of the Subordinated Notes,
(iii) the Preferred Securities or any Successor Securities are listed, or any
Successor Securities will be listed upon notification of issuance, on any
national securities exchange or other organization on which the Preferred
Securities are then listed, (iv) such merger, consolidation, amalgamation or
replacement does not cause the Preferred Securities (including any Successor
Securities) to be downgraded by any nationally recognized statistical rating
organization, (v) such merger, consolidation, amalgamation or replacement does
not adversely affect the rights, preferences and privileges of the holders of
the Trust Securities (including any Successor Securities) in any material
respect (other than with respect to any dilution of the holders' interest in the
new entity), (vi) such successor entity has a purpose identical to that of the
Trust, (vii) prior to such merger, consolidation, amalgamation or replacement,
ComEd has received an opinion from independent 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 Trust 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 such successor entity will be
required to register as an investment company under the 1940 Act and (viii)
ComEd guarantees the obligations of such successor entity under the Successor
Securities at least to the extent provided by the Preferred Securities
Guarantee. Notwithstanding the foregoing, the Trust shall not, except with the
consent of holders of 100% in liquidation amount of the Trust Securities,
consolidate, amalgamate, merge with or into, or be replaced by any other entity
or permit any other entity to consolidate, amalgamate, merge with or into, or
replace it if such consolidation, amalgamation, merger or replacement would
cause the Trust or the successor entity to be classified
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for United States federal income tax purposes as other than a grantor trust and
each holder of Trust Securities not to be treated as owning an undivided
beneficial interest in the Subordinated Notes.
BOOK-ENTRY ONLY ISSUANCE - THE DEPOSITORY TRUST COMPANY
The Depository Trust Company ("DTC") will act as securities depositary
for the Preferred Securities. The Preferred Securities will be issued only as
fully registered securities registered in the name of Cede & Co. (DTC's
nominee). One or more fully registered global Preferred Securities certificates
will be issued, representing in the aggregate the total number of Preferred
Securities, and will be deposited with DTC.
The laws of some jurisdictions require that certain purchasers of
securities take physical delivery of securities in definitive form. Such laws
may impair the ability to transfer beneficial interests in a global Preferred
Security.
DTC is a limited-purpose trust company organized under the New York
Banking Law, a "banking organization" within the meaning of the New York Banking
Law, a member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "Clearing agency"
registered pursuant to the provisions of Section 17A of the Exchange Act. DTC
holds securities that its participants ("Participants") deposit with DTC. DTC
also facilitates the settlement among Participants of securities transactions,
such as transfers and pledges, in deposited securities through electronic
computerized book-entry changes in Participants' accounts, thereby eliminating
the need for physical movement of securities certificates. Direct Participants
include securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations ("Direct Participants"). DTC is
owned by a number of its Direct Participants and by the New York Stock Exchange,
the American Stock Exchange, Inc., and the National Association of Securities
Dealers, Inc. Access to the DTC system is also available to others such as
securities brokers and dealers, banks and trust companies that clear through or
maintain a custodial relationship with a Direct Participant, either directly or
indirectly ("Indirect Participants"). The rules applicable to DTC and its
Participants are on file with the Commission.
Purchases of Preferred Securities within the DTC system must be made
by or through Direct Participants, which will receive a credit for the Preferred
Securities on DTC's records. The ownership interest of each actual purchaser of
Preferred Securities ("Beneficial Owner") is in turn to be recorded on the
Direct and Indirect Participants' records. Beneficial Owners will not receive
written confirmation from DTC of their purchases, but Beneficial Owners are
expected to receive written confirmations providing details of the transactions,
as well as periodic statements of their holdings, from the Direct or Indirect
Participants through which the Beneficial Owners purchased Preferred Securities.
Transfers of ownership interests in the Preferred Securities are to be
accomplished by entries made on the books of Participants acting on behalf of
Beneficial Owners. Beneficial Owners will not receive certificates representing
their ownership interests in Preferred Securities, except in the event that use
of the book-entry system for the Preferred Securities is discontinued.
To facilitate subsequent transfers, all the Preferred Securities
deposited by Participants with DTC are registered in the name of DTC's nominee,
Cede & Co. The deposit of Preferred Securities with DTC and their registration
in the name of Cede & Co. effect no change in beneficial ownership. DTC has no
knowledge of the actual Beneficial Owners of the Preferred Securities. DTC's
records reflect only the identity of the Direct Participants to whose accounts
such Preferred Securities are credited, which may or may not be the Beneficial
Owners. The Participants will remain responsible for keeping account of their
holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to
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Beneficial Owners will be governed by arrangements among them, subject to any
statutory or regulatory requirements as may be in effect from time to time.
Redemption notices shall be sent to Cede & Co. If less than all of the
Preferred Securities are being redeemed, DTC will reduce pro rata the amount of
the interest of each Direct Participant in the Preferred Securities to be
redeemed; provided that if, as a result of such pro rata redemption, Direct
Participants would hold fractional interests in the Preferred Securities, DTC
will adjust the amount of the interest of each Direct Participant to be redeemed
to avoid such fractional interests.
Although voting with respect to the Preferred Securities is limited,
in those cases where a vote is required neither DTC nor Cede & Co. will itself
consent or vote with respect to Preferred Securities. Under its usual
procedures, DTC would mail an Omnibus Proxy to the Trust as soon as possible
after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or
voting rights to those Direct Participants to whose accounts the Preferred
Securities are credited on the record date (identified in a listing attached to
the Omnibus Proxy).
Distribution payments on the Preferred Securities will be made to DTC.
DTC's practice is to credit Direct Participants' accounts on the relevant
payment date in accordance with their respective holdings shown on DTC's records
unless DTC has reason to believe that it will not receive payments on such
payment date. Payments by participants to Beneficial Owners will be governed by
standing instructions and customary practices, as in the case with securities
held for the account of customers in bearer form or registered in "street name,"
and will be the responsibility of such Participant and not of DTC, the Trust,
any trustee or ComEd, subject to any statutory or regulatory requirements as may
be in effect from time to time. Payment of distributions to DTC is the
responsibility of the Trust, disbursement of such payments to Direct
Participants is the responsibility of DTC, and disbursement of such payments to
the Beneficial Owners is the responsibility of Direct and Indirect Participants.
Except as provided herein, a Beneficial Owner in a global Preferred
Security will not be entitled to receive physical delivery of Preferred
Securities. Accordingly, each Beneficial Owner must rely on the procedures of
DTC to exercise any rights under the Preferred Securities.
DTC may discontinue providing its services as securities depositary
with respect to the Preferred Securities at any time by giving reasonable notice
to the Trust. Under such circumstances, in the event that a successor
securities depositary is not obtained, Preferred Securities certificates are
required to be printed and delivered. Additionally, the Regular Trustees (with
the consent of ComEd) may decide to discontinue use of the system of book-entry
transfers through DTC (or a successor depositary) with respect to the Preferred
Securities. In that event, certificates for the Preferred Securities will be
printed and delivered.
The information in this section concerning DTC and DTC's book-entry
system has been obtained from sources that ComEd and the Trust believe to be
reliable, but ComEd and the Trust take no responsibility for the accuracy
thereof.
INFORMATION CONCERNING THE PROPERTY TRUSTEE
The Property Trustee, prior to the occurrence of a default with
respect to the Trust Securities and after the curing of all such defaults that
may have occurred, undertakes to perform only such duties as are specifically
set forth in the Declaration and, after default, shall exercise the same degree
of care as a prudent individual would exercise in the conduct of his or her own
affairs. Subject to such provisions, the Property Trustee is under no
obligation to exercise any of the powers vested in it by the Declaration at the
request of any holder of Preferred Securities, unless offered reasonable
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indemnity by such holder against the costs, expenses and liabilities which might
be incurred thereby; but the foregoing shall not relieve the Property Trustee,
upon the occurrence of a Declaration Event of Default, from exercising the
rights and powers vested in it by the Declaration. The Property Trustee also
serves as trustee under the Preferred Securities Guarantee.
REGISTRAR AND TRANSFER AGENT
In the event that the Preferred Securities do not remain in book-entry
only form, the Property Trustee will act as paying agent and may designate an
additional or substitute paying agent at any time. Registration of transfers of
Preferred Securities will be effected without charge by or on behalf of the
Trust, but upon payment (with the giving of such indemnity as the Regular
Trustees may require) in respect of any tax or other government charges which
may be imposed in relation to it. The Trust will not be required to register or
cause to be registered the transfer of Preferred Securities after such Preferred
Securities have been called for redemption.
GOVERNING LAW
The Declaration and the Preferred Securities will be governed by, and
construed in accordance with, the internal laws of the State of Delaware.
MISCELLANEOUS
The Regular Trustees are authorized and directed to operate the Trust
in such a way so that the Trust will not be deemed to be an "investment company"
required to be registered under the 1940 Act or characterized for United States
federal income tax purposes as other than a grantor Trust. ComEd is authorized
and directed to conduct its affairs so that the Subordinated Notes will be
treated as indebtedness of ComEd for United States federal income tax purposes.
In this connection, the Regular Trustees and ComEd are authorized to take any
action, not inconsistent with applicable law, the restated articles of
incorporation of ComEd, that each of the Regular Trustees and ComEd determines
in their discretion to be necessary or desirable for such purposes, as long as
such action does not materially and adversely affect the interests of the
holders of the Preferred Securities.
DESCRIPTION OF THE PREFERRED SECURITIES GUARANTEE
Set forth below is a summary of information concerning the Preferred
Securities Guarantee that will be executed and delivered by ComEd for the
benefit of the holders from time to time of the Preferred Securities. The
Preferred Securities Guarantee will be qualified as an indenture under the Trust
Indenture Act. Wilmington Trust Company will act as the Preferred Guarantee
Trustee. The terms of the Preferred Securities Guarantee will be those set
forth therein and those made part thereof by the Trust Indenture Act. The
following summary does not purport to be complete and is subject in all respects
to the provisions of, and is qualified in its entirety by reference to, the
Preferred Securities Guarantee, which is filed as an exhibit to the Registration
Statement of which this Prospectus forms a part and the Trust Indenture Act.
The Preferred Securities will be held by the Preferred Guarantee Trustee for the
benefit of the holders of the Preferred Securities.
GENERAL
Pursuant to the Preferred Securities Guarantee, ComEd will irrevocably
and unconditionally agree, to the extent set forth therein, to pay in full to
the holders of the Preferred Securities the Guarantee Payments (as defined
herein) (without duplication of amounts theretofore paid by the Trust), to the
extent not paid by the Trust, regardless of any defense, right of set-off or
counterclaim that the Trust may have or assert. The following payments or
distributions with respect
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to the Preferred Securities to the extent not paid or made by the Trust (the
"Guarantee Payments") will be subject to the Preferred Securities Guarantee
(without duplication): (i) any accrued and unpaid distributions that are
required to be paid on the Preferred Securities, to the extent the Trust has
funds available therefor, (ii) the Redemption Price, including all accrued and
unpaid distributions to the date of the redemption, to the extent the Trust has
funds available therefor, with respect to any Preferred Securities called for
redemption by the Trust and (iii) upon a voluntary or involuntary dissolution,
winding-up or termination of the Trust (other than in connection with the
distribution of Subordinated Notes to the holders of Preferred Securities in
exchange for Preferred Securities), the lesser of (a) the aggregate of the
liquidation amount and all accrued and unpaid distributions on the Preferred
Securities to the date of payment and (b) the amount of assets of the Trust
remaining available for distribution to holders of Preferred Securities in
liquidation of the Trust. ComEd's obligation to make a Guarantee Payment may be
satisfied by direct payment of the required amounts by ComEd to the holders of
Preferred Securities or by causing the Trust to pay such amounts to such
holders.
The Preferred Securities Guarantee will be a full and unconditional
guarantee of the Guarantee Payments with respect to the Preferred Securities
from the time of issuance of the Preferred Securities, but will not apply to the
payment of distributions and other payments on the Preferred Securities when the
Property Trustee does not have sufficient funds in the Property Account to make
such distributions or other payments. If ComEd does not make interest payments
on the Subordinated Notes held by the Property Trustee, the Trust will not make
distributions on the Preferred Securities issued by the Trust and will not have
funds available therefor. See "Description of the Subordinated Notes -- Certain
Covenants."
ComEd has also agreed separately to irrevocably and unconditionally
guarantee the obligations of the Trust with respect to the Common Securities
(the "Common Securities Guarantee") to the same extent as the Preferred
Securities Guarantee, except that upon the occurrence and during the
continuation of an Indenture Event of Default, holders of Preferred Securities
shall have priority over holders of Common Securities with respect to
distributions and payments on liquidation, redemption or otherwise.
CERTAIN COVENANTS OF COMED
In the Preferred Securities Guarantee, ComEd will covenant that, so
long as the Preferred Securities remain outstanding, if there shall have
occurred and is continuing any event that would constitute an event of default
under the Preferred Securities Guarantee or the Declaration, then (a) ComEd
shall not declare or pay any dividend on, or make any distribution with respect
to, or redeem, purchase, acquire or make a liquidation payment with respect to,
any of its capital stock, and (b) ComEd shall not make any payment of interest,
principal or premium, if any, on or repay, repurchase or redeem any debt
securities (including guarantees) issued by ComEd which rank pari passu with or
junior to the Subordinated Notes.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes which do not materially adversely
affect the rights of holders of Preferred Securities (in which case no vote will
be required), the Preferred Securities Guarantee may be amended only with the
prior approval of the holders of not less than 66-2/3% in liquidation amount of
the outstanding Preferred Securities. The manner of obtaining any such approval
of holders of the Preferred Securities is set forth under "Description of the
Preferred Securities -- Voting Rights." All guarantees and agreements contained
in the Preferred Securities Guarantee shall bind the successors, assigns,
receivers, trustees and representatives of ComEd and shall inure to the benefit
of the Preferred Guarantee Trustee and the holders of the Preferred Securities
then outstanding.
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TERMINATION OF THE PREFERRED SECURITIES GUARANTEE
The Preferred Securities Guarantee will terminate and be of no further
force and effect as to the Preferred Securities upon full payment of the
Redemption Price of all Preferred Securities, or upon distribution of the
Subordinated Notes to the holders of the Preferred Securities, and will
terminate completely upon full payment of the amounts payable upon liquidation
of the Trust. See "Description of the Subordinated Notes -- Events of Default"
for a description of the events of default and enforcement rights of the holders
of Subordinated Notes. The Preferred Securities Guarantee will continue to be
effective or will be reinstated, as the case may be, if at any time any holder
of Preferred Securities must repay to the Trust or ComEd, or their successors,
any sums paid to them under such Preferred Securities or the Preferred
Securities Guarantee.
EVENTS OF DEFAULT
An event of default under the Preferred Securities Guarantee will
occur upon the failure of ComEd to perform any of its payment or other
obligations thereunder.
The holders of a majority in liquidation amount of the Preferred
Securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Preferred Guarantee Trustee in
respect of the Preferred Securities Guarantee or to direct the exercise of any
trust or power conferred upon the Preferred Guarantee Trustee under the
Preferred Securities Guarantee. If the Preferred Guarantee Trustee fails to
enforce the Preferred Securities Guarantee, any holder of Preferred Securities
may institute a legal proceeding directly against ComEd to enforce the Preferred
Guarantee Trustee's rights under the Preferred Securities Guarantee, without
first instituting a legal proceeding against the Trust, the Preferred Guarantee
Trustee or any other person or entity.
STATUS OF THE PREFERRED SECURITIES GUARANTEE
ComEd's obligations under the Preferred Securities Guarantee to make
the Guarantee Payments will constitute an unsecured obligation of ComEd and will
rank (i) subordinate and junior in right of payment to all other liabilities of
ComEd, including the Subordinated Notes, except those liabilities of ComEd made
pari passu or subordinate by their terms, (ii) pari passu with the most senior
preferred stock now or hereafter issued by ComEd and with any guarantee now or
hereafter entered into by ComEd in respect of any preferred stock of any
affiliate of ComEd, and (iii) senior to ComEd's common stock. The terms of the
Preferred Securities provide that each holder of Preferred Securities by
acceptance thereof agrees to the subordination provisions and other terms of the
Preferred Securities Guarantee.
The Preferred Securities Guarantee will constitute a guarantee of
payment and not of collection (that is, the guaranteed party may institute a
legal proceeding directly against the guarantor to enforce its rights under the
guarantee without instituting a legal proceeding against any other person or
entity). The Preferred Securities Guarantee will be deposited with the
Preferred Guarantee Trustee to be held for the benefit of the holders of the
Preferred Securities. Except as otherwise noted herein, the Preferred Guarantee
Trustee has the right to enforce the Preferred Securities Guarantee on behalf of
the holders of the Preferred Securities. The Preferred Securities Guarantee
will not be discharged except by payment of the Guarantee Payments in full
(without duplication of amounts theretofore paid by the Trust).
INFORMATION CONCERNING THE PREFERRED GUARANTEE TRUSTEE
The Preferred Guarantee Trustee, prior to the occurrence of a default
with respect to the Preferred Securities Guarantee and after the curing of all
such defaults that may have occurred, undertakes to perform only such duties as
are specifically set forth in the Preferred Securities
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Guarantee and, after default, shall exercise the same degree of care as a
prudent individual would exercise in the conduct of his or her own affairs.
Subject to such provisions, the Preferred Guarantee Trustee is under no
obligation to exercise any of the powers vested in it by the Preferred
Securities Guarantee at the request of any holder of Preferred Securities,
unless offered reasonable indemnity against the costs, expenses and liabilities
which might be incurred thereby; but the foregoing shall not relieve the
Preferred Guarantee Trustee, upon the occurrence of an event of default under
the Preferred Securities Guarantee, from exercising the rights and powers vested
in it by the Preferred Securities Guarantee. The Preferred Guarantee Trustee
also serves as Property Trustee.
GOVERNING LAW
The Preferred Securities Guarantee will be governed by, and construed
in accordance with, the internal laws of the State of New York.
DESCRIPTION OF THE SUBORDINATED NOTES
Set forth below is a description of the terms of the Subordinated
Notes. The following description does not purport to be complete and is subject
to, and is qualified in its entirety by reference to, the Indenture (the "Base
Indenture"), dated as of July __, 1995, between ComEd and Wilmington Trust
Company, as Trustee (the "Debt Trustee"), as supplemented by a First
Supplemental Indenture, dated as of ________, 1995 (the Base Indenture, as so
supplemented, is hereinafter referred to as the "Indenture"), the forms of which
are filed as an exhibit to the Registration Statement of which this Prospectus
forms a part. The terms of the Subordinated Notes will include those stated in
the Indenture and those made a part of the Indenture by reference to the Trust
Indenture Act. Certain capitalized terms used herein are defined in the
Indenture.
Under certain circumstances involving the dissolution of the Trust
following the occurrence of a Special Event, Subordinated Notes may be
distributed to the holders of Trust Securities in liquidation of the Trust. See
"Description of the Preferred Securities -- Special Event Redemption or
Distribution."
If the Subordinated Notes are distributed to the holders of the Trust
Securities, ComEd will use its best efforts to have the Subordinated Notes
listed on the New York Stock Exchange or on such other exchange as the Preferred
Securities are then listed.
GENERAL
The Subordinated Notes will be issued as unsecured subordinated debt
securities under the Indenture. The Subordinated Notes will be limited in
aggregate principal amount to approximately $206.2 million, such amount being
the sum of the aggregate stated liquidation amount of the Preferred Securities
and the capital contributed by ComEd in exchange for the Common Securities (the
"Payment").
The Subordinated Notes are not subject to a sinking fund provision.
The entire principal amount of the Subordinated Notes will mature and become due
and payable, together with any accrued and unpaid interest thereon, including
Additional Interest (as defined herein), if any, on September 30, 2035.
If Subordinated Notes are distributed to holders of the Preferred
Securities in liquidation of such holders' interests in the Trust, such
Subordinated Notes will initially be issued as a Global Security (as defined
below). As described herein, under certain limited circumstances, Subordinated
Notes may be issued in certificated form in exchange for a Global Security. See
"--Book Entry and Settlement." In the event Subordinated Notes are issued in
certificated form, such Subordinated Notes
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will be in denominations of $25 and integral multiples thereof and may be
transferred or exchanged at the offices described below. Payments on
Subordinated Notes issued as a Global Security will be made to the depositary
for the Subordinated Notes. In the event Subordinated Notes are issued in
certificated form, principal and interest will be payable, the transfer of the
Subordinated Notes will be registrable and Subordinated Notes will be
exchangeable for Subordinated Notes of other denominations of a like aggregate
principal amount at the corporate trust office of the Debt Trustee in
____________, _____________; provided, that payment of interest may be made at
the option of ComEd by check mailed to the address of the persons entitled
thereto.
The Indenture does not contain provisions that afford holders of the
Subordinated Notes protection in the event of a highly leveraged transaction
involving ComEd.
SUBORDINATION
The Indenture provides that the Subordinated Notes are subordinated
and junior in right of payment to all Senior Indebtedness of ComEd, whether now
existing or hereafter incurred. No payment of principal of (including
redemption payments, if any), premium, if any, or interest on, the Subordinated
Notes may be made if (a) any Senior Indebtedness of ComEd is not paid when due
and any applicable grace period with respect to such default has ended with such
default not being cured or waived or ceasing to exist, or (b) the maturity of
any Senior Indebtedness has been accelerated because of a default. Upon any
distribution of assets of ComEd to creditors upon any dissolution, winding-up,
liquidation or reorganization, whether voluntary or involuntary, or in
bankruptcy, insolvency, receivership or other proceedings, all principal of,
premium, if any, and interest due or to become due on, all Senior Indebtedness
must be paid in full before the holders of the Subordinated Notes are entitled
to receive or retain any payment. The rights of the holders of the Subordinated
Notes will be subrogated to the rights of the holders of Senior Indebtedness to
receive payments or distributions applicable to such Senior Indebtedness until
all amounts owing on the Subordinated Notes are paid in full.
The term "Senior Indebtedness" means (i) any payment in respect of (a)
indebtedness of ComEd for money borrowed and (b) indebtedness evidenced by
securities, debentures, bonds, notes or other similar instruments issued by
ComEd including, without limitation, indebtedness evidenced by securities issued
pursuant to its Mortgage dated July 1, 1923, as supplemented, and indentures
with various trustees (other than the Indenture); (ii) all capital lease
obligations of ComEd; (iii) all obligations of ComEd issued or assumed as the
deferred purchase price of property, all conditional sale obligations of ComEd
and all obligations of ComEd under any title retention agreement (but excluding
trade accounts payable arising in the ordinary course of business); (iv) all
obligations of ComEd 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) above of other
persons for the payment of which ComEd is responsible or liable as obligor,
guarantor or otherwise; and (vi) all obligations of the type referred to in
clauses (i) through (v) above of other persons secured by any lien on any
property or asset of ComEd (whether or not such obligation is assumed by ComEd),
except for (1) any such indebtedness that is by its terms subordinated to or
pari passu with the Subordinated Notes, as the case may be, including all other
debt securities and guarantees in respect of those debt securities, issued to
any other trusts, partnerships or other entities affiliated with ComEd which act
as a financing vehicle of ComEd in connection with the issuance of preferred
securities by such entity or other securities which rank pari passu with, or
junior to, the Preferred Securities, and (2) any indebtedness between or among
ComEd and its affiliates. Such Senior Indebtedness shall continue to be Senior
Indebtedness and be entitled to the benefits of the subordination provisions
irrespective of any amendment, modification or waiver of any term of such Senior
Indebtedness.
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The Indenture does not limit the aggregate amount of Senior
Indebtedness which may be issued by ComEd. As of June 30, 1995, Senior
Indebtedness of ComEd aggregated approximately $8,231 million.
CERTAIN COVENANTS
If (i) there shall have occurred any event that would constitute an
Indenture Event of Default or (ii) ComEd shall be in default with respect to its
payment of any obligations under the Preferred Securities Guarantee or the
Common Securities Guarantee, then (a) ComEd shall not declare or pay any
dividend on, make any distributions with respect to, or redeem, purchase or make
a liquidation payment with respect to, any of its capital stock, (b) ComEd shall
not make any payment of interest, principal or premium, if any, on or repay,
repurchase or redeem any debt securities issued by ComEd which rank pari passu
with or junior to the Subordinated Notes and (c) ComEd shall not make any
guarantee payments with respect to the foregoing (other than pursuant to the
Preferred Securities Guarantee).
If ComEd shall have given notice of its election of an Extension
Period as provided in the Indenture and such period, or any extension thereof,
shall be continuing, then (a) ComEd shall not declare or pay any dividend on,
make any distributions with respect to, or redeem, purchase or make a
liquidation payment with respect to, any of its capital stock, (b) ComEd shall
not make any payment of interest, principal or premium, if any, on or repay,
repurchase or redeem any debt securities (including guarantees) issued by ComEd
which rank pari passu with or junior to the Subordinated Notes and (c) ComEd
shall not make any guarantee payments with respect to the foregoing (other than
pursuant to the Preferred Securities Guarantee).
For so long as the Trust Securities remain outstanding, ComEd will
covenant (i) to directly or indirectly maintain 100% direct or indirect
ownership of the Common Securities of the Trust; provided, however, that any
permitted successor of ComEd under the Indenture may succeed to ComEd's
ownership of such Common Securities, (ii) not to cause, as sponsor of the Trust,
or to permit, as holder of the Common Securities, the dissolution, winding-up or
termination of the Trust, except in connection with a distribution of the
Subordinated Notes as provided in the Declaration and in connection with certain
mergers, consolidations or amalgamations and (iii) to use its reasonable efforts
to cause the Trust (a) to remain a statutory business trust, except in
connection with the distribution of Subordinated Notes to the holders of Trust
Securities in liquidation of the Trust, the redemption of all of the Trust
Securities of the Trust, or certain mergers, consolidations or amalgamations,
each as permitted by the Declaration, and (b) to otherwise continue to be
classified as a grantor trust for United States federal income purposes.
OPTIONAL REDEMPTION
ComEd shall have the right to redeem the Subordinated Notes, in whole
or in part, from time to time, on or after September 30, 2000, or at any time in
certain circumstances upon the occurrence of a Tax Event as described under
"Description of the Preferred Securities -- Special Event Redemption or
Distribution," upon not less than 30 nor more than 60 days' notice, at a
Redemption Price equal to 100% of the principal amount to be redeemed plus any
accrued and unpaid interest, including Additional Interest, if any, to the
redemption date. If a partial redemption of the Preferred Securities resulting
from a partial redemption of the Subordinated Notes would result in the
delisting of the Preferred Securities, ComEd may only redeem the Subordinated
Notes in whole.
INTEREST
Each Subordinated Note shall bear interest at the rate of ____% per
annum from the original date of issuance, payable quarterly in arrears on March
31, June 30, September 30 and
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December 31 of each year (each, an "Interest Payment Date"), commencing
September 30, 1995, to the person in whose name such Subordinated Note is
registered, subject to certain exceptions, at the close of business on the
Business Day next preceding such Interest Payment Date. In the event the
Subordinated Notes shall not continue to remain in book-entry only form, ComEd
shall have the right to select record dates which shall be not less than fifteen
days prior to each Interest Payment Date.
The amount of interest payable for any period will be computed on the
basis of a 360-day year of twelve 30-day months. The amount of interest payable
for any period shorter than a full quarterly period will be computed on the
basis of the actual number of days elapsed in such 90-day quarter. In the event
that any date on which interest is payable on the Subordinated Notes is not a
Business Day, then payment of the 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.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
ComEd shall have the right at any time, and from time to time, during
the term of the Subordinated Notes to defer payments of interest by extending
the interest payment period for a period not exceeding 20 consecutive quarters,
at the end of which Extension Period, ComEd shall pay all interest then accrued
and unpaid (including any Additional Interest, together with interest thereon at
the rate specified for the Subordinated Notes to the extent permitted by
applicable law); provided, that, during any such Extension Period, (a) ComEd
shall not declare or pay any dividend on, make any distributions with respect
to, or redeem, purchase or make a liquidation payment with respect to, any of
its capital stock, (b) ComEd shall not make any payment of interest, principal
or premium, if any, on or repay, repurchase or redeem any debt securities
(including guarantees) issued by ComEd which rank pari passu with or junior to
the Subordinated Notes and (c) ComEd shall not make any guarantee payments with
respect to the foregoing (other than pursuant to the Preferred Securities
Guarantee). Prior to the termination of any such Extension Period, ComEd may
further defer payments of interest by extending the interest payment period,
provided that such Extension Period together with all such previous and further
extensions thereof may not exceed 20 consecutive quarters or extend beyond the
maturity of the Subordinated Notes. Upon the termination of any Extension
Period and the payment of all amounts then due, ComEd may select a new Extension
Period, as if no Extension Period had previously been declared, subject to the
above requirements. No interest during an Extension Period, except at the end
thereof, shall be due and payable. ComEd has no present intention of exercising
its rights to defer payments of interest by extending the interest payment
period on the Subordinated Notes. If the Property Trustee shall be the sole
holder of the Subordinated Notes, ComEd shall give the Regular Trustees and the
Property Trustee notice of its selection of such Extension Period one Business
Day prior to the earlier of (i) the next succeeding date on which distributions
on the Preferred Securities are payable or (ii) the date the Trust is required
to give notice to the New York Stock Exchange or other applicable self-
regulatory organization or to holders of the Preferred Securities of the record
date or the date such distribution is payable, but in any event not less than
one Business Day prior to such record date. The Regular Trustees shall give
notice of ComEd's selection of such Extension Period to the holders of the
Preferred Securities. If the Property Trustee shall not be the sole holder of
the Subordinated Notes, ComEd shall give the holders of the Subordinated Notes
notice of its selection of such Extension Period ten Business Days prior to the
earlier of (i) the Interest Payment Date or (ii) the date ComEd is required to
give notice to the New York Stock Exchange or other applicable self-regulatory
organization or to holders of the Subordinated Notes of the record or payment
date of such related interest payment, but in any event at least two Business
Days before such record date.
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ADDITIONAL INTEREST
If at any time the Trust shall be 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
such case, ComEd will pay as additional interest ("Additional Interest") such
additional amounts as shall be required so that the net amounts received and
retained by the Trust after paying any such taxes, duties, assessments or other
governmental charges will be equal to the amounts the Trust would have received
had no such taxes, duties, assessments or other governmental charges been
imposed.
INDENTURE EVENTS OF DEFAULT
In case any Indenture Event of Default shall occur and be continuing,
the Property Trustee, as the holder of the Subordinated Notes, will have the
right to declare the principal of and the interest on the Subordinated Notes
(including any Additional Interest, if any) and any other amounts payable under
the Indenture to be forthwith due and payable and to enforce its other rights as
a creditor with respect to the Subordinated Notes.
The Indenture provides that any one or more of the following described
events, which has occurred and is continuing, constitutes an "Event of Default"
with respect to the Subordinated Notes:
(a) failure for 30 days to pay interest on the Subordinated Notes,
including any Additional Interest in respect thereof, when due; provided,
however, that a valid extension of the interest payment period by ComEd
shall not constitute a default in the payment of interest for this purpose;
or
(b) failure to pay principal or premium, if any, on the Subordinated
Notes when due whether at maturity, upon earlier redemption or otherwise;
or
(c) failure to observe or perform any other covenant (other than those
specifically relating to another series of subordinated debt securities)
contained in the Indenture for 90 days after written notice to ComEd from
the Debt Trustee or the holders of at least 25% in principal amount of the
outstanding Subordinated Notes; or
(d) certain events of bankruptcy, insolvency or reorganization of
ComEd; or
(e) the voluntary or involuntary dissolution, winding-up or
termination of the Trust, except in connection with the distribution of
Subordinated Notes to the holders of Preferred Securities in liquidation of
the Trust, the redemption of all outstanding Trust Securities of the Trust
and certain mergers, consolidations or amalgamations permitted by the
Declaration.
The holders of a majority in aggregate outstanding principal amount of
the Subordinated Notes have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Debt Trustee. The
Debt Trustee or the holders of not less than 25% in aggregate outstanding
principal amount of the Subordinated Notes may declare the principal due and
payable immediately on default, but the holders of a majority in aggregate
outstanding principal amount may annul such declaration and waive the default if
the default has been cured and a sum sufficient to pay all matured installments
of interest and principal due otherwise than by acceleration and any applicable
premium has been deposited with the Debt Trustee.
The holders of a majority in aggregate outstanding principal amount of
the Subordinated Notes affected thereby may, on behalf of the holders of all the
Subordinated Notes, waive any past
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default, except (i) a default in the payment of principal, premium, if any, or
interest (unless such default has been cured and a sum sufficient to pay all
matured installments of interest and principal due otherwise than by
acceleration and any applicable premium has been deposited with the Debt
Trustee) or (ii) a default in the covenant of ComEd not to declare or pay
dividends on, or make distributions with respect to, or redeem, purchase or
acquire any of its capital stock during an Extension Period. An Indenture Event
of Default also constitutes a Declaration Event of Default. The holders of
Preferred Securities in certain circumstances have the right to direct the
Property Trustee to exercise its rights as the holder of the Subordinated Notes.
See "Description of the Preferred Securities -- Declaration Events of Default"
and "-- Voting Rights."
BOOK-ENTRY AND SETTLEMENT
If distributed to holders of Preferred Securities in connection with
the voluntary or involuntary dissolution, winding-up or liquidation of the Trust
as a result of the occurrence of a Special Event, the Subordinated Notes will be
issued in the form of one or more global certificates (each, a "Global
Security") registered in the name of the depositary or its nominee. Except
under the limited circumstances described below, Subordinated Notes represented
by the Global Security will not be exchangeable for, and will not otherwise be
issuable as, Subordinated Notes in definitive form. The Global Securities
described above may not be transferred except by the depositary to a nominee of
the depositary or by a nominee of the depositary to the depositary or another
nominee of the depositary or to a successor depositary or its nominee.
The laws of some jurisdictions require that certain purchasers of
securities take physical delivery of such securities in definitive form. Such
laws may impair the ability to transfer beneficial interests in such a Global
Security.
Except as provided below, owners of beneficial interests in such a
Global Security will not be entitled to receive physical delivery of
Subordinated Notes in definitive form and will not be considered the holders (as
defined in the Indenture) thereof for any purpose under the Indenture, and no
Global Security representing Subordinated Notes shall be exchangeable, except
for another Global Security of like denomination and tenor to be registered in
the name of the depositary or its nominee or to a successor depositary or its
nominee. Accordingly, each beneficial owner must rely on the procedures of the
depositary and, if such person is not a Participant, on the procedures of the
Participant through which such person owns its interest, to exercise any rights
of a Holder under the Indenture.
If Subordinated Notes are distributed to holders of Preferred
Securities in liquidation of such holders' interests in the Trust, DTC will act
as securities depositary for the Subordinated Notes. For a description of DTC
and the specific terms of the depository arrangements, see "Description of the
Preferred Securities -- Book-Entry Only Issuance -- The Depository Trust
Company." The description therein of DTC's book-entry system and DTC's
practices as they relate to purchases, transfers, notices and payments with
respect to the Preferred Securities apply in all material respects to any debt
obligations represented by one or more Global Securities held by DTC. ComEd may
appoint a successor to DTC or any successor depositary in the event DTC or such
successor depositary is unable or unwilling to continue as depositary.
None of ComEd, the Trust, the Debt Trustee, any paying agent and any
other agent of ComEd or the Debt Trustee will have any responsibility or
liability for any aspect of the records relating to or payments made on account
of beneficial ownership interests in a Global Security for such Subordinated
Notes or for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.
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A Global Security shall be exchangeable for Subordinated Notes
registered in the names of persons other than the depositary or its nominee only
if (i) the depositary notifies ComEd that it is unwilling or unable to continue
as a depositary for such Global Security and no successor depositary shall have
been appointed, or if at any time the depositary ceases to be registered or in
good standing under the Exchange Act (or other applicable statute or regulation)
at a time when the depositary is required to be so registered to act as such
depositary and no successor depositary shall have been appointed by ComEd within
90 days after ComEd receives such notice or becomes aware of such condition,
(ii) ComEd in its sole discretion determines that such Global Security shall be
so exchangeable or (iii) there shall have occurred an Event of Default with
respect to such Subordinated Notes. Any Global Security that is exchangeable
pursuant to the preceding sentence shall be exchangeable for Subordinated Notes
registered in such names as the depositary shall direct. It is expected that
such instructions will be based upon directions received by the depositary from
its Participants with respect to ownership of beneficial interests in such
Global Security.
In the event the Subordinated Notes are not represented by one or more
Global Securities, certificates evidencing Subordinated Notes may be presented
for registration of transfer (with the form of transfer endorsed thereon duly
executed) or exchange, at the office of the Note Registrar or at the office of
any transfer agent designated by ComEd for such purpose with respect to the
Subordinated Notes, without service charge and upon payment of any taxes and
other governmental charges as described in the Indenture. Such transfer or
exchange will be effected upon the Note Registrar or such transfer agent, as the
case may be, being satisfied with the documents of title and identity of the
person making the request. ComEd has appointed the Debt Trustee as Note
Registrar with respect to the Subordinated Notes. ComEd may at any time rescind
the designation of any such transfer agent or approve a change in the location
through which any such transfer agent acts, except that ComEd will be required
to maintain a transfer agent at the place of payment. ComEd may at any time
designate additional transfer agents with respect to the Subordinated Notes.
In the event of any redemption in part, ComEd shall not be required to
(i) issue, exchange or register the transfer of Subordinated Notes during a
period beginning at the opening of business 15 days before the day of the
mailing of a notice of redemption of less than all of the Subordinated Notes and
ending at the close of business on the date of such mailing and (ii) register
the transfer of or exchange any Subordinated Notes so selected for redemption,
in whole or in part, except the unredeemed portion of any Subordinated Notes
being redeemed in part.
PAYMENT AND PAYING AGENTS
Payment of principal of and premium (if any) on the Subordinated Notes
will be made only against surrender to the Paying Agent of the Subordinated
Notes. Principal of and any premium and interest, if any, on Subordinated Notes
will be payable, subject to any applicable laws and regulations, at the office
of such Paying Agent or Paying Agents as ComEd may designate from time to time,
except that at the option of ComEd payment of any interest may be made by check
mailed to the address of the person entitled thereto as such address shall
appear in the Note Register with respect to the Subordinated Notes. Payment of
interest on the Subordinated Notes on any Interest Payment Date will be made to
the person in whose name the Subordinated Note (or predecessor security) is
registered at the close of business on the Regular Record Date for such interest
payment.
The Debt Trustee will act as Paying Agent with respect to the
Subordinated Notes. ComEd may at any time designate additional Paying Agents or
rescind the designation of any Paying Agents or approve a change in the office
through which any Paying Agent acts, except that ComEd will be required to
maintain a Paying Agent at the place of payment.
All moneys paid by ComEd to a Paying Agent for the payment of the
principal of or premium or interest, if any, on the Subordinated Notes which
remain unclaimed at the end of two years after such principal, premium, if any,
or interest shall have become due and payable will be repaid to
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ComEd and the holder of such Subordinated Notes will thereafter look only to
ComEd for payment thereof.
MODIFICATION OF THE INDENTURE
The Indenture contains provisions permitting ComEd and the Debt
Trustee, with the consent of the holders of not less than a majority in
principal amount of the Subordinated Notes, to modify the Indenture or any
supplemental indenture affecting that series or the rights of the holders of the
Subordinated Notes; provided that no such modification may, without the consent
of the holder of each outstanding Subordinated Note affected thereby, (i) extend
the fixed maturity of the Subordinated Notes, 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 the Subordinated Notes so affected or (ii) reduce the
percentage of Subordinated Notes, the holders of which are required to consent
to any such supplemental indenture, without the consent of the holders of each
Subordinated Note then outstanding and affected thereby.
In addition, ComEd and the Debt Trustee may execute, without the
consent of holders of the Subordinated Notes, any supplemental indenture for
certain other usual purposes including the creation of any new series of
subordinated debt securities.
CONSOLIDATION, MERGER AND SALE
The Indenture does not contain any covenant which restricts the
Trust's or ComEd's ability to merge or consolidate with or into any other
corporation, sell or convey all or substantially all of its assets to any
person, firm or corporation or otherwise engage in restructuring transactions.
DEFEASANCE AND DISCHARGE
Under the terms of the Indenture, ComEd will be discharged from any
and all obligations in respect of the Subordinated Notes (except in each case
for certain obligations with respect to denominations and provisions for payment
of the Subordinated Notes and obligations to register the transfer or exchange
of Subordinated Notes, replace stolen, lost or mutilated Subordinated Notes,
maintain paying agencies and hold moneys for payment in trust) if ComEd (i)
deposits with the Debt Trustee, in trust, moneys or governmental obligations, in
an amount sufficient to pay all the principal of, and interest on, the
Subordinated Notes on the dates such payments are due in accordance with the
terms of such Subordinated Notes and (ii) delivers to the Debt Trustee an
opinion of counsel to the effect that, based upon ComEd's receipt from, or the
publication by, the Internal Revenue Service of a ruling or a change in law, the
holders of the Subordinated Notes will not recognize income, gain or loss for
United States federal income tax purposes as a result of the deposit, defeasance
and discharge and will be subject to United States federal income tax on the
same amount and in the same manner and at the same times as would have been the
case if such deposit, defeasance or discharge had not occurred.
GOVERNING LAW
The Indenture and the Subordinated Notes will be governed by, and
construed in accordance with, the internal laws of the State of New York.
INFORMATION CONCERNING THE DEBT TRUSTEE
The Debt Trustee, prior to default, undertakes to perform only such
duties as are specifically set forth in the Indenture and, after default, shall
exercise the same degree of care as a prudent individual would exercise in the
conduct of his or her own affairs. Subject to such provision,
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<PAGE>
the Debt Trustee is under no obligation to exercise any of the powers vested in
it by the Indenture at the request of any holder of Subordinated Notes, unless
offered reasonable indemnity by such holder against the costs, expenses and
liabilities which might be incurred thereby; but the foregoing shall not relieve
the Debt Trustee, upon the occurrence of an Indenture Event of Default, from
exercising the rights and powers vested in it by the Indenture. The Debt Trustee
is not required to expand or risk its own funds or otherwise incur personal
financial liability in the performance of its duties if the Debt Trustee
reasonably believes that repayment or adequate indemnity is not reasonably
assured to it.
MISCELLANEOUS
ComEd will have the right at all times to assign any of its rights or
obligations under the Indenture to a direct or indirect wholly-owned subsidiary
of ComEd; provided that, in the event of any such assignment, ComEd will remain
liable for all of their obligations. Subject to the foregoing, the Indenture
will be binding upon and inure to the benefit of the parties thereto and their
respective successors and assigns. The Indenture provides that it may not
otherwise be assigned by the parties thereto.
The Indenture will provide that ComEd will pay all fees and expenses
related to (i) the offering of the Trust Securities and the Subordinated Notes,
(ii) the organization, maintenance and dissolution of the Trust, (iii) the
retention of the ComEd Trustees and (iv) the enforcement by the Property Trustee
of the rights of holders of Preferred Securities.
EFFECT OF OBLIGATIONS UNDER THE SUBORDINATED NOTES
AND THE PREFERRED SECURITIES GUARANTEE
As set forth in the Declaration, the sole purposes of the Trust are to
(i) issue Trust Securities, (ii) invest the proceeds thereof in the Subordinated
Notes and (iii) engage in only those other activities necessary or incidental
thereto.
As long as payments of interest and other payments are made when due
on the Subordinated Notes, such payments will be sufficient to cover
distributions and payments due on the Trust Securities primarily because (i) the
aggregate principal amount of Subordinated Notes will be equal to the sum of the
aggregate stated liquidation amount of the Trust Securities; (ii) the interest
rate and interest and other payment dates on the Subordinated Notes will match
the distribution rate and distribution and other payment dates for the Preferred
Securities; (iii) ComEd shall pay for all costs and expenses of the Trust; and
(iv) the Declaration provides that the ComEd Trustees shall not cause or permit
the Trust to, among other things, engage in any activity that is not consistent
with the purposes of the Trust.
Payments of distributions (to the extent funds therefor are available)
and other payments due on the Preferred Securities (to the extent funds therefor
are available) are guaranteed by ComEd as and to the extent set forth under
"Description of the Preferred Securities Guarantee". If ComEd does not make
interest payments on the Subordinated Notes purchased by the Trust, it is
expected that the Trust will not have sufficient funds to pay distributions on
the Preferred Securities. The Preferred Securities Guarantee is a full and
unconditional guarantee from the time of its issuance, but does not apply to any
payment of distributions unless and until the Trust has sufficient funds for the
payment of such distributions.
If ComEd fails to make interest or other payments on the Subordinated
Notes when due (taking into account any Extension Period), the Declaration
provides a mechanism whereby the holders of the Preferred Securities, using the
procedures described in "Description of the Preferred Securities -- Voting
Rights," may direct the Property Trustee to enforce its rights under the
Subordinated Notes, including proceeding directly against ComEd to enforce the
Subordinated Notes. If the Property
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Trustee fails to enforce its rights under the Subordinated Notes, a 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 ComEd to enforce the Property
Trustee's rights under the Subordinated Notes without first instituting any
legal proceeding against the Property Trustee or any other person or entity,
including the Trust.
If ComEd fails to make payments under the Preferred Securities
Guarantee, the Preferred Securities Guarantee provides a mechanism whereby the
holders of the Preferred Securities may direct the Preferred Guarantee Trustee
to enforce its rights thereunder. If the Preferred Guarantee Trustee fails to
enforce the Preferred Securities Guarantee, any holder of Preferred Securities
may institute a legal proceeding directly against ComEd to enforce the Preferred
Guarantee Trustee's rights under the Preferred Securities Guarantee, without
first instituting a legal proceeding against the Trust, the Preferred Guarantee
Trustee or any other person or entity.
ComEd and the Trust believe that the above mechanisms and obligations,
taken together, are substantially equivalent to a full and unconditional
guarantee by ComEd of payments due on the Preferred Securities. See
"Description of the Preferred Securities Guarantees -- General."
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of certain of the principal United States
federal income tax consequences of the purchase, ownership and disposition of
the Preferred Securities to a holder that is a citizen or resident of the United
States, a corporation, partnership or other entity created or organized under
the laws of the United States or any state thereof or the District of Columbia
or an estate or trust the income of which is subject to United States federal
income taxation regardless of source (a "Holder"). This summary does not
address the United States federal income tax consequences to persons other than
Holders.
This summary is based on the United States federal income tax laws,
regulations and rulings and decisions now in effect, all of which are subject to
change, possibly on a retroactive basis. This summary does not address the tax
consequences applicable to investors that may be subject to special tax rules
such as banks, thrifts, real estate investment trusts, regulated investment
companies, insurance companies, dealers in securities or currencies, tax-exempt
investors or persons that will hold the Preferred Securities as a position in a
"straddle," as part of a "synthetic security" or "hedge," as part of a
"conversion transaction" or other integrated investment or as other than a
capital asset. This summary also does not address the tax consequences to
persons that have a functional currency other than the U.S. dollar or the tax
consequences to shareholders, partners or beneficiaries of a Holder. Further,
it does not include any description of any alternative minimum tax consequences
or the tax laws of any state or local government or of any foreign government
that may be applicable to a Holder.
CLASSIFICATION OF COMED FINANCING
Sidley & Austin, counsel to ComEd and special counsel to the Trust, is
of the opinion that, under current law and assuming full compliance with the
terms of the Indenture and the Declaration (and certain other documents), the
Trust will be classified as a "grantor trust" for federal income tax purposes
and will not be classified as an association taxable as a corporation or a
partnership. Each Holder will be treated as owning an undivided beneficial
interest in the Subordinated Notes. Accordingly, each Holder will be required
to include in its gross income the original issue discount ("OID") accrued with
respect to its allocable share of Subordinated Notes. Investors should be aware
that the opinion of Sidley & Austin does not address any other issue and is not
binding on the Internal Revenue Service (the "Service") or the courts.
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ORIGINAL ISSUE DISCOUNT, PREMIUM AND MARKET DISCOUNT
Because of the option that ComEd has, under the terms of the
Subordinated Notes, to defer payments of interest by extending interest payment
periods for up to 20 quarters, the Subordinated Notes will be treated as issued
with OID in an amount equal to all of the stated interest payments on the
Subordinated Notes. Holders must include the OID attributable to the
Subordinated Notes in income on an economic accrual basis before the receipt of
cash attributable to the interest, regardless of their method of tax accounting.
The amount of OID that accrues in any month will approximately equal the amount
of the interest that accrues in that month at the stated interest rate. In the
event that the interest payment period is extended, Holders will continue to
accrue OID approximately equal to the amount of the interest payment due at the
end of the extended interest payment period on an economic accrual basis over
the length of the extended interest period. Corporate Holders will not be
entitled to a dividends-received deduction with respect to any income earned
with respect to the Preferred Securities.
To the extent a Holder acquires its Preferred Securities at a price
that is greater or less than the adjusted issue price of such Holder's share of
Subordinated Notes (which generally should approximate par plus accrued but
unpaid interest), the Holder will be deemed to have acquired its interest in the
Preferred Securities with acquisition premium or with market discount, as the
case may be. A Holder acquiring Preferred Securities at a premium will be
permitted to reduce the amount of OID required to be included in income to
reflect the acquisition premium. A Holder acquiring Preferred Securities at a
market discount will also include the amount of such discount in income in
accordance with the market discount rules described below.
A Holder acquiring Preferred Securities at a market discount generally
will be required to recognize ordinary income to the extent of accrued market
discount upon the retirement of the underlying Subordinated Notes or, to the
extent of any gain, upon the disposition of the Preferred Securities. Such
market discount would accrue ratably, or, at the election of the Holder, under a
constant yield method over the remaining term of the Subordinated Notes. A
Holder will also be required to defer the deduction of a portion of the interest
paid or accrued on indebtedness incurred to purchase or carry Preferred
Securities acquired with market discount. In lieu of the foregoing, a Holder
may elect to include market discount in income currently as it accrues on all
market discount instruments acquired by such Holder in the taxable year of the
election or thereafter, in which the interest deferral rule will not apply. A
Holder may elect, in lieu of applying the market discount or premium rules
described above, to account for all income under the Preferred Securities as if
it were OID.
RECEIPT OF SUBORDINATED NOTES UPON LIQUIDATION OF THE TRUST
Under certain circumstances, as described under the caption
"Description of the Preferred Securities -- Special Event Redemption or
Distribution," Subordinated Notes may be distributed to Holders in exchange for
the Preferred Securities and in liquidation of the Trust. Such a distribution
would be treated as a non-taxable event to each Holder and each Holder would
receive an aggregate tax basis in the Subordinated Notes equal to such Holder's
aggregate tax basis in the Preferred Securities. A Holder's holding period in
the Subordinated Notes so received in liquidation of the Trust would include the
period for which the Preferred Securities were held by such Holder.
SALE OF PREFERRED SECURITIES
A Holder that sells Preferred Securities will recognize gain or loss
equal to the difference between its adjusted tax basis in the Preferred
Securities and the amount realized on the sale. A Holder's adjusted tax basis
in the Preferred Securities generally will be its initial purchase price
increased by original issue discount previously includible in such Holder's
gross income to the date of
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disposition (and the accrual of market discount, if any) and decreased by
payments received on the Preferred Securities. Subject to the market discount
rules described above, any such gain or loss generally will be capital gain or
loss.
The Preferred Securities may trade at a price that does not accurately
reflect the value of accrued but unpaid interest with respect to the underlying
Subordinated Notes. A Holder disposing of its Preferred Securities between
record dates for payments of distributions thereon will be required to include
accrued but unpaid interest through the date of disposition in income as
ordinary income (i.e. OID), and to add such amount to its adjusted tax basis in
its Preferred Securities. To the extent the selling price is less than the
Holder's adjusted tax basis (which will include, in the form of OID, all accrued
but unpaid interest), a Holder will recognize a capital loss. Subject to
certain limited exceptions, capital losses cannot be applied to offset ordinary
income for United States federal income tax purposes.
FOREIGN INVESTORS
Subject to the discussion of backup withholding below, interest
(including OID) with respect to the Preferred Securities paid to a nonresident
alien individual, foreign corporation, foreign partnership or foreign estate or
trust will be exempt from U.S. withholding tax, provided that the holder
complies with applicable certification requirements (and does not actually or
constructively own ten percent or more of the voting stock of ComEd and is not a
controlled foreign corporation related to ComEd or its affiliates).
INFORMATION REPORTING TO HOLDERS
Subject to the qualifications discussed below, income on the Preferred
Securities will be reported to Holders on Form 1099, which forms should be
mailed to Holders of Preferred Securities by January 31 following each calendar
year.
The Trust will be obligated to report annually to Cede & Co., as
Holder of record of the Preferred Securities, the OID with respect to the
Preferred Securities that accrued during that year. The Trust currently intends
to report such information on Form 1099 prior to January 31 following each
calendar year even though the Trust is not legally required to report to record
Holders until April 15 following each calendar year. The Underwriters have
indicated to the Trust that, to the extent that they hold Preferred Securities
as nominees for beneficial Holders, they currently expect to report to such
beneficial Holders on Forms 1099 by January 31 following each calendar year.
Under current law, Holders of Preferred Securities who hold as nominees for
beneficial Holders will not have any obligation to report information regarding
the beneficial Holders to the Trust. The Trust, moreover, will not have any
obligation to report to beneficial Holders who are not also record holders.
Thus, beneficial Holders of Preferred Securities who hold their Preferred
Securities through the Underwriters will receive Forms 1099 reflecting the
income on their Preferred Securities from such nominee Holders rather than the
Trust.
BACKUP WITHHOLDING
Payments made on, and proceeds from the sale of, the Preferred
Securities may be subject to a "backup" withholding tax of 31% unless the Holder
complies with certain identification requirements. Any withheld amounts will be
allowed as a credit against the Holder's federal income tax, provided that
required information is provided to the Service.
THE FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR
GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE DEPENDING UPON A HOLDER'S
PARTICULAR SITUATION. HOLDERS SHOULD CONSULT THEIR TAX ADVISORS WITH RESPECT TO
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THE TAX CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF THE
PREFERRED SECURITIES, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL, FOREIGN
AND OTHER TAX LAWS AND THE POSSIBLE EFFECTS OF CHANGES IN FEDERAL OR OTHER TAX
LAWS.
UNDERWRITING
Subject to the terms and conditions set forth in an underwriting
agreement (the "Underwriting Agreement"), the Trust has agreed to sell to each
of the underwriters named below (the "Underwriters"), and each of the
Underwriters, for whom Merrill Lynch, Pierce, Fenner & Smith Incorporated is
acting as representative (the "Representative"), has severally agreed to
purchase the number of Preferred Securities set forth opposite its name below.
In the Underwriting Agreement, the several Underwriters have agreed, subject to
the terms and conditions set forth therein, to purchase all of the Preferred
Securities offered hereby if any of the Preferred Securities are purchased. In
the event of default by an Underwriter, the Underwriting Agreement provides
that, in certain circumstances, the purchase commitments of the nondefaulting
Underwriters may be increased or the Underwriting Agreement may be terminated.
NUMBER OF PREFERRED
UNDERWRITER SECURITIES
- ----------- -------------------
Total............................
_______
The Underwriters propose to offer the Preferred Securities in part
directly to the public at the initial public offering price, as set forth on the
cover page of this Prospectus, and in part to certain securities dealers at such
price less a concession of $ ____ per Preferred Security. The Underwriters may
allow, and such dealers may reallow, a concession not in excess of $ ____ per
Preferred Security to certain brokers and dealers. After the Preferred
Securities are released for sale to the public, the offering price and other
selling terms may from time to time be varied by the Representative.
In view of the fact that the proceeds of the sale of the Preferred
Securities will be used to purchase the Subordinated Notes of ComEd, the
Underwriting Agreement provides that ComEd will agree to pay as compensation
("Underwriters' Compensation") to the Underwriters for the Underwriters'
arranging the investment therein of such proceeds, an amount in New York
Clearing House (next day) funds of $ ____ per Preferred Security (or $ ____ in
the aggregate) for the accounts of the several Underwriters, provided that such
compensation for sales of 10,000 or more Preferred Securities to any single
purchaser will be $ ____ per Preferred Security. Therefore, to the extent of
such sales, the actual amount of Underwriters' Compensation will be less than
the aggregate amount specified in the preceding sentence.
During a period of 30 days from the date of the pricing of the
Preferred Securities, neither the Trust nor ComEd will, without the prior
written consent of the Representative, directly or indirectly, sell, offer to
sell, contract 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 the Subordinated Notes or any debt
securities substantially similar to the Subordinated
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<PAGE>
Notes or any equity securities substantially similar to the Preferred Securities
(except for any series of subordinated debt securities and the Preferred
Securities offered hereby).
An application will be filed with the New York Stock Exchange for the
listing of the Preferred Securities, subject to official notice of issuance. If
approved for listing, trading of the Preferred Securities on the New York Stock
Exchange is expected to commence within a 30 day period after the initial
delivery of the Preferred Securities. The Representative has advised the Trust
that the Underwriters intend to make a market in the Preferred Securities prior
to the commencement of trading on the New York Stock Exchange. The Underwriters
will have no obligation to make a market in the Preferred Securities, however,
and may cease market making activities, if commenced, at any time.
Prior to this offering, there has been no public market for the
Preferred Securities. In order to meet one of the requirements for listing the
Preferred Securities on the New York Stock Exchange, the Underwriters will
undertake to sell lots of 100 or more Preferred Securities to a minimum of 400
beneficial holders.
ComEd and the Trust have agreed to indemnify the Underwriters against,
or to contribute to payments that the Underwriters may be required to make in
respect of, certain liabilities, including liabilities under the Securities Act.
Certain of the Underwriters engage in transactions with, and, from
time to time, have performed services for, ComEd in the ordinary course of
business.
It is expected that delivery of the Preferred Securities will be made
against payment therefor on or about the date specified in the last paragraph of
the cover page hereof, which is the fifth business day following the date
hereof. Under Rule 15c6-1 recently adopted by the Commission under the Exchange
Act, trades in the secondary market generally are required to settle in three
business days, unless the parties to any such trade expressly agree otherwise.
Accordingly, purchasers who wish to trade the Preferred Securities on the date
hereof or the next succeeding business day will be required, by virtue of the
fact that the Preferred Securities initially will settle in T+5, to specify
alternate arrangements to prevent a failed settlement.
LEGAL MATTERS
Certain matters of Delaware law relating to the validity of the
Preferred Securities will be passed upon on behalf of the Trust by Richards,
Layton & Finger, special Delaware counsel to the Trust. The validity of the
Subordinated Notes, the Preferred Securities Guarantee and certain matters
relating thereto will be passed upon on behalf of ComEd by Sidley & Austin,
Chicago, Illinois. Certain legal matters will be passed upon on behalf of the
Underwriters by their counsel. Certain United States federal income taxation
matters will be passed upon for ComEd and the Trust by Sidley & Austin.
EXPERTS
The financial statements and schedules included or incorporated by
reference in the 1994 Form 10-K Report, the January 27, 1995 Form 8-K Report and
the March 31, 1995 Form 10-Q Report have been audited by Arthur Andersen LLP,
independent certified public accountants, as indicated in their reports with
respect thereto, and are incorporated herein in reliance upon the authority of
said firm as experts in accounting and auditing in giving said reports.
Reference is made to said reports included or incorporated by reference in the
1994 Form 10-K Report and the January 27, 1995 Form 8-K Report, each of which
includes an explanatory paragraph with respect to a change in the method of
accounting for postretirement health care benefits and income taxes, as
discussed in Notes 13 and 14 to the financial statements, respectively.
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DEFINITIONS
<TABLE>
<CAPTION>
TERM PAGE
- ---- ----
<S> <C>
Additional Interest.................................................... 31
Base Indenture......................................................... 27
Beneficial Owner....................................................... 22
Business Day........................................................... 15
Change in 1940 Act Law................................................. 16
ComEd.................................................................. 1
ComEd Trustees......................................................... 8
Commission............................................................. 3
Common Securities...................................................... 1
Common Securities Guarantee............................................ 25
Company................................................................ 1
DTC.................................................................... 22
Debt Trustee........................................................... 27
Declaration............................................................ 8
Declaration Event of Default........................................... 19
Direct Participants.................................................... 22
Dissolution Tax Opinion................................................ 16
distributions.......................................................... 2
Exchange Act........................................................... 3
Extension Period....................................................... 2
Global Security........................................................ 32
Fuel Matters Settlement................................................ 11
Guarantee Payments..................................................... 25
Holder................................................................. 36
ICC.................................................................... 10
Indenture.............................................................. 27
Indenture Event of Default............................................. 19
Indirect Participants.................................................. 22
Interest Payment Date.................................................. 30
Investment Company Event............................................... 16
January 27, 1995 Form 8-K Report....................................... 3
Liquidation Distribution............................................... 18
March 31, 1995 Form 10-Q Report........................................ 3
New York Stock Exchange................................................ 1
1940 Act............................................................... 16
1994 Form 10-K Report.................................................. 3
No Recognition Opinion................................................. 16
OID.................................................................... 36
Participants........................................................... 22
Payment................................................................ 27
Preferred Guarantee Trustee............................................ 9
Preferred Securities................................................... 1
Preferred Securities Guarantee......................................... 2
Property Account....................................................... 9
Property Trustee....................................................... 8
Rate Matters Settlement................................................ 11
Rate Order............................................................. 12
Redemption Price....................................................... 2
Redemption Tax Opinion................................................. 17
Registration Statement................................................. 3
Regular Trustees....................................................... 8
Remand Order........................................................... 11
Representative......................................................... 39
Securities Act......................................................... 3
Senior Indebtedness.................................................... 28
Service................................................................ 36
Special Event.......................................................... 16
Sponsor................................................................ 8
Successor Securities................................................... 21
Subordinated Notes..................................................... 1
Super-Majority......................................................... 19
Supreme Court.......................................................... 10
Tax Event.............................................................. 16
Trust.................................................................. 1
Trust Act.............................................................. 9
Trust Indenture Act.................................................... 8
Trust Securities....................................................... 1
Underwriters........................................................... 39
Underwriters' Compensation............................................. 39
Underwriting Agreement................................................. 39
</TABLE>
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<PAGE>
No dealer, salesperson or other individual has been authorized to give any
information or to make any representation other than those contained or
incorporated by reference in this Prospectus in connection with the offer made
by this Prospectus and, if given or made, such information or representations
must not be relied upon as having been authorized by Commonwealth Edison
Company, ComEd Financing I or the Underwriters. Neither the delivery of this
Prospectus nor any sale made hereunder shall under any circumstance create an
implication that there has been no change in the affairs of Commonwealth Edison
Company or ComEd Financing I, since the date hereof. This Prospectus does not
constitute an offer or solicitation by anyone in any state in which such offer
or solicitation is not authorized or in which the person making such offer or
solicitation is not qualified to do so or to anyone to whom it is unlawful to
make such offer or solicitation.
---------------------
TABLE OF CONTENTS
Prospectus
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information.................... 3
Incorporation of Certain Documents by
Reference.............................. 3
Prospectus Summary....................... 4
Risk Factors............................. 5
Commonwealth Edison Company.............. 8
ComEd Financing I........................ 8
Selected Financial Information........... 9
Capitalization of ComEd.................. 13
Accounting Treatment..................... 13
Use of Proceeds.......................... 14
Description of the Preferred Securities.. 14
Description of the Preferred Securities
Guarantee.............................. 24
Description of the Subordinated Notes.... 27
Effect of Obligations Under the
Subordinated Notes and the Preferred
Securities Guarantee................... 35
Certain Federal Income Tax Consequences.. 36
Underwriting............................. 39
Legal Matters............................ 40
Experts.................................. 40
Definitions.............................. 41
</TABLE>
8,000,000
PREFERRED SECURITIES
COMED FINANCING I
____% TRUST ORIGINATED
PREFERRED SECURITIES ("TOPrS")
GUARANTEED TO THE EXTENT SET
FORTH HEREIN BY
COMMONWEALTH EDISON COMPANY
_____________________
P R O S P E C T U S
_____________________
MERRILL LYNCH & CO.
PAINEWEBBER INCORPORATED
SALOMON BROTHERS INC
AUGUST , 1995
<PAGE>
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<CAPTION>
<S> <C>
Securities and Exchange Commission filing fee........... $ 68,966
New York Stock Exchange listing fee..................... 58,300
Rating Agency fees...................................... 120,000
Trustees' expenses...................................... 35,000
Printing and engraving fees............................. 70,000
Accounting fees and expenses............................ 25,000
Legal fees and expenses................................. 100,000
Miscellaneous........................................... 22,734
--------
Total................................................... $500,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Certain provisions of the Illinois Business Corporation Act of 1983
(the "BCA") provide that ComEd may, and in some circumstances must, indemnify
the directors and officers of ComEd and of each subsidiary company against
liabilities and expenses incurred by any such person by reason of the fact that
such person was serving in such capacity, subject to certain limitations and
conditions set forth in the statute. ComEd's By-laws provide that ComEd will
indemnify its directors and officers, and any person serving as a director or
officer of another business entity at ComEd's request, to the extent permitted
by the statute. In addition, ComEd's Restated Articles of Incorporation
provide, as permitted by the BCA, that directors shall not be personally liable
for monetary damages for breach of fiduciary duty as a director, except (i) for
breaches of their duty of loyalty to ComEd or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 8.65 of the BCA, and (iv) for transactions
from which a director derived an improper personal benefit.
ComEd has purchased liability insurance policies which indemnify
ComEd's directors and officers, the directors and officers of subsidiaries of
ComEd, the trustees of the Service Annuity Funds, and officers of ComEd serving
as directors and officers on behalf of ComEd with certain other entities,
against loss arising from claims by reason of their legal liability for acts as
such directors, officers or trustees, subject to certain limitations and
conditions set forth in the policies.
ComEd indemnifies assistant officers and certain other employees
against liabilities and expenses incurred by reason of acts performed in
connection with the operations of the various employee benefit systems of ComEd
and its subsidiaries.
The Declaration of Trust provides that no Regular Trustee, affiliate
of any Regular Trustee, or any officers, directors, shareholders, members,
partners, employees, representatives, or agents of any Regular Trustee, or any
employee or agent of the Trust or its affiliates (each an "Indemnified Person")
shall be liable, responsible or accountable in damages or otherwise to the 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 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 the Declaration or by law, except that
an Indemnified Person shall be liable for any such loss, damage or claim
incurred by reason of such Indemnified Person's gross negligence or willful
misconduct with respect to such act or omission. The Declaration of Trust also
provides that, to the fullest extent permitted by applicable law, ComEd 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 the Trust and in a manner such Indemnified Person
S-1
<PAGE>
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 indemnified in respect of any loss, damage or claim
incurred by such Indemnified Person by reason of gross negligence or willful
misconduct with respect to such act or omission. The Declaration of 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 ComEd prior to the final disposition of such claim, demand, action,
suit or proceeding upon receipt by ComEd 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 for the underlying cause of
action as authorized by such Declaration.
ITEM 16. EXHIBITS.
The following exhibits are filed herewith.
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- ------- ------------------------------------------------------------
(1) Form of underwriting agreement for offering of Preferred Securities.
(4)-1 Certificate of Trust of the Trust.
(4)-2 Form of Amended and Restated Declaration of Trust.
(4)-3 Form of Indenture between ComEd and Wilmington Trust Company, as
Trustee.
(4)-4 Form of Supplemental Indenture to Indenture to be used in connection
with the issuance of Subordinated Notes.
(4)-5 Form of Preferred Security (included in (4)-2).
(4)-6 Form of Subordinated Note Security (included in (4)-4).
(4)-7 Form of Preferred Securities Guarantee.
(5)-1 Opinion re legality of Preferred Securities.
(5)-2 Opinion re legality of Subordinated Notes and the Preferred
Securities Guarantee.
(8) Opinion re tax matters.
(12) Statement re Computation of Ratios of Earnings to Fixed Charges and
Ratios of Earnings to Fixed Charges and Preferred and Preference Stock
Dividend Requirements.
(23)-1 Consent of Richards, Layton & Finger (included in (5)-1).
(23)-2 Consent of Sidley & Austin (included in (5)-2).
(23)-3 Consent of Experts.
(24) Powers of attorney of Directors whose names are signed to this
registration statement pursuant to such powers.
(25)-1 Statement of Eligibility of Property Trustee.
S-2
<PAGE>
(25)-2 Statement of Eligibility of Debt Trustee.
(25)-3 Statement of Eligibility of Preferred Guarantee Trustee.
(27) Financial Data Schedule.
ITEM 17. UNDERTAKINGS.
THE UNDERSIGNED REGISTRANTS HEREBY UNDERTAKE:
(1) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to section
13(a) or section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(2) That for purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the registrants pursuant to Rule 424(b)(1) or (4) under
the Securities Act of 1933 shall be deemed to be part of this registration
statement as of the time it was declared effective.
(3) That for purposes of determining any liability under the Securities Act
of 1933, 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.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrants pursuant to the provisions described in Item 15, 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 a
registrant of expenses incurred or paid by a director, officer or controlling
person of such registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, such registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
The undersigned Trust registrant hereby undertakes to provide to the
underwriters at the closing specified in the underwriting agreement certificates
in such denominations and registered in such names as required by the
underwriters to permit prompt delivery to each purchaser.
S-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Commonwealth
Edison Company 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
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Chicago, and State of Illinois, on this 27th day
of July, 1995.
COMMONWEALTH EDISON COMPANY
By James J. O'Connor
-------------------------------------
James J. O'Connor, Chairman and Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities indicated on this 27th day of July, 1995.
Signature Title
--------- -----
James J. O'Connor Chairman and Chief Executive
--------------------------------------
James J. O'Connor Officer and Director
(principal executive officer)
John C. Bukovski Vice President
--------------------------------------
John C. Bukovski (principal financial officer)
Roger F. Kovack Comptroller
--------------------------------------
Roger F. Kovack (principal accounting officer)
Jean Allard* Director
James W. Compton* Director
Sue L. Gin* Director
Donald P. Jacobs* Director
Edgar D. Jannotta* Director
George E. Johnson* Director
Edward A. Mason* Director
Frank A. Olson* Director
Samuel K. Skinner* President and Director
*By David A. Scholz
--------------------------------------
David A. Scholz, Attorney-in-fact
S-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, ComEd Financing
I certifies that is has reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Chicago, State of Illinois, on the 27th day of
July, 1995.
COMED FINANCING I
By John C. Bukovski
------------------------------
John C. Bukovski
Trustee
By Dennis F. O'Brien
------------------------------
Dennis F. O'Brien
Trustee
WILMINGTON TRUST COMPANY, as Trustee
By ______________________________
[Name]
[Title]
S-5
<PAGE>
EXHIBIT INDEX
The following exhibits are filed herewith.
Exhibit
Number Description of Document
- ------ -----------------------------------------------------------------------
(1) Form of underwriting agreement for offering of Preferred Securities.
(4)-1 Certificate of Trust of the Trust.
(4)-2 Form of Amended and Restated Declaration of Trust.
(4)-3 Form of Indenture between ComEd and Wilmington Trust Company, as
Trustee.
(4)-4 Form of Supplemental Indenture to Indenture to be used in connection
with the issuance of Subordinated Notes.
(4)-5 Form of Preferred Security (included in (4)-2).
(4)-6 Form of Subordinated Note Security (included in (4)-4).
(4)-7 Form of Preferred Securities Guarantee.
(5)-1 Opinion re legality of Preferred Securities.
(5)-2 Opinion re legality of Subordinated Notes and the Preferred Securities
Guarantee.
(8) Opinion re tax matters.
(12) Statement re Computation of Ratios of Earnings to Fixed Charges and
Ratios of Earnings to Fixed Charges and Preferred and Preference
Stock Dividend Requirements.
(23)-1 Consent of Richards, Layton & Finger (included in (5)-1).
(23)-2 Consent of Sidley & Austin (included in (5)-2).
(23)-3 Consent of Experts.
(24) Powers of attorney of Directors whose names are signed to this
registration statement pursuant to such powers.
(25)-1 Statement of Eligibility of Property Trustee.
(25)-2 Statement of Eligibility of Debt Trustee.
(25)-3 Statement of Eligibility of Preferred Guarantee Trustee.
(27) Financial Data Schedule.
<PAGE>
Exhibit (1)
Commonwealth Edison Company
Form S-3
File No. 33-
8,000,000 PREFERRED SECURITIES
COMED FINANCING 1
(A DELAWARE TRUST)
__% TRUST ORIGINATED PREFERRED SECURITIES ("TOPRS")
(LIQUIDATION AMOUNT OF $25 PER PREFERRED SECURITY)\SM\
UNDERWRITING AGREEMENT
_____________, 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
Ladies and Gentlemen:
1. Introductory. ComEd 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. (S)(S) 3801
et seq.), and Commonwealth Edison Company, an Illinois 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 9
hereof), for whom Merrill Lynch is acting as representative (in such capacity,
Merrill Lynch shall hereinafter be referred to as the "Representative"), with
respect to the issue and 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
- ----------------
\SM\ "Trust Originated Preferred Securities" and "TOPrS" are service marks of
Merrill Lynch & Co., Inc.
<PAGE>
("Preferred Securities") set forth in said Schedule A except as may otherwise be
provided in the Pricing Agreement, as hereinafter defined. 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 _________, 1995,
between the Company and Wilmington Trust Company, as trustee (the "Guarantee
Trustee"), and entitled to the benefits of certain 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 Guarantee are referred to herein collectively as the
"Securities."
Prior to the purchase and public offering of the Preferred 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 Preferred
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-_____) and a related
preliminary prospectus for the registration under the Securities Act of 1933, as
amended (the "1933 Act"), of up to a combination of $200,000,000 of (i)
preferred securities, including the Preferred Securities, (ii) guarantees of the
preferred securities, including the Preferred Securities Guarantee and (iii)
unsecured subordinated debt securities, including the Subordinated Debt
Securities (as defined below) 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 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 hereinafter referred to as the
"Registration Statement" and the "Prospectus," respectively, except that, if any
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<PAGE>
revised prospectus shall be provided to the Underwriters by the Offerors for use
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 by the Offerors with the Commission 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 documents filed by the Company with the Commission pursuant to the 1934 Act
and incorporated by reference in the Registration Statement or the Prospectus,
as aforesaid, are hereinafter referred to as the "Incorporated Documents." 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"), as 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 ___________, 1995,
between the Company and the Guarantee Trustee, as Trustee, and will be used by
the Trust to purchase the $__________ principal amount of __% subordinated debt
securities (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 ___________,
1995 (the "Declaration"), among the Company, as Sponsor, J.C. Bukovski and
Dennis F. O'Brien (the "Regular Trustees") and Wilmington Trust Company, a
Delaware banking corporation, as property trustee (the "Property Trustee" and,
together with the Regular Trustees, 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
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<PAGE>
_____________, 1995 (the "Base Indenture"), between the Company and Wilmington
Trust Company, as trustee (the "Debt Trustee"), and a supplement to the Base
Indenture, dated as of ______________, 1995 (the "Supplemental Indenture" and,
together with the Base Indenture and any other amendments or supplements
thereto, the "Indenture"), between the Company and the Debt Trustee.
2. Representations and Warranties of the Offerors. The Offerors jointly
and severally represent and warrant to, and agree with, the Underwriters that:
(a) The Registration Statement and the Prospectus, at the time the
Registration Statement became effective, complied, and as of the date
hereof comply, and at Closing Time, as hereinafter defined, will comply, in
all material respects with the requirements of the 1933 Act and the 1934
Act and the rules and regulations of the Commission under such Acts; the
Incorporated Documents, as of their respective dates of filing with the
Commission, complied and will comply in all material respects with the
requirements of the 1934 Act and the rules and regulations of the
Commission thereunder; the Registration Statement and any amendment thereof
(including the filing of any annual report on Form 10-K), at the time it
became effective did not, and as of the date of the Pricing Agreement and
as of 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 not misleading; and the
Prospectus, at the time the Registration Statement became effective did
not, as of the date hereof does not and as of the date of the Pricing
Agreement and the Closing Time will not, contain 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 Section 2(a) shall not apply to (A) that part of the
Registration Statement which constitutes the Statements of Eligibility and
Qualification (Forms T-1 and T-2) under the 1939 Act, as amended, or (B)
statements in or omissions from the Registration Statement or the
Prospectus made in reliance upon and in conformity with information
furnished to the Offerors in writing by any Underwriter through the
Representative expressly for use in the Registration Statement or the
Prospectus.
(b) Arthur Andersen LLP, the accountants who certified certain of the
financial statements included or incorporated by reference in the
Prospectus, are independent public accountants as required by the 1933 Act
and the rules and regulations of the Commission thereunder.
-4-
<PAGE>
(c) The financial statements (together with related schedules and
notes, selected financial data and summary financial information), included
or incorporated by reference in the Prospectus present fairly the financial
position, results of operations and cash flows of the Company and its
consolidated subsidiaries as at the respective dates and for the respective
periods specified and, except as otherwise stated in the Prospectus, such
financial information has been prepared in conformity with generally
accepted accounting principles applied on a consistent basis during the
periods involved. The Company has no material contingent obligation which
is not disclosed in the Prospectus.
(d) Except as set forth in or contemplated by the Prospectus, no
material transaction has been entered into by the Company or the Trust
otherwise than in the ordinary course of business, and no materially
adverse change has occurred in the condition, financial or otherwise, of
the Company or the Trust, in each case since the respective dates as of
which information is given in the Prospectus.
(e) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Illinois with
corporate power and authority to own its properties and conduct its
business as described in the Prospectus.
(f) Each significant subsidiary of the Company, as defined in Rule 1-
02 of Regulation S-X of the Commission ("significant subsidiary"), has been
duly incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation; all of the issued
and outstanding capital stock of each significant subsidiary has been duly
and validly issued and is fully paid and non-assessable; and all of the
capital stock of each significant subsidiary is owned by the Company free
and clear of any pledge, lien, encumbrance, claim or equity.
(g) 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; the Trust is duly
qualified to transact business as a foreign company and is in good standing
in any other jurisdiction in which such qualification is 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 Trust; the Trust is not a party
to or
-5-
<PAGE>
otherwise bound by any agreement other than those described in the
Prospectus; the Trust is and will be classified for United States federal
income tax purposes as a grantor trust and not as an association taxable as
a corporation; and the Trust is and will be treated as a consolidated
subsidiary of the Company pursuant to generally accepted accounting
principles.
(h) Neither the Company nor any significant subsidiary is in violation
of its Articles or Certificate of Incorporation or by-laws; the Trust is
not in violation of the Declaration or its certificate of trust filed with
the State of Delaware on _____________, 1995 (the "Certificate of Trust");
none of the Company, any significant subsidiary or the Trust is in default
in the performance or observance of any obligation, agreement, covenant or
condition contained in any mortgage or any contract, lease, note or other
instrument to which the Company, any significant subsidiary or the Trust is
a party or by which any of them may be bound, nor is any of them in
violation of any law, administrative regulation or administrative,
arbitration or court order, except in each case to such extent as may be
set forth in the Prospectus or except to the extent that such defaults or
violations would not, in the aggregate, have a material adverse effect on
the Company, any significant subsidiary or the Trust; and the execution and
delivery of this Agreement, the incurrence of the obligations herein set
forth and the consummation of the transactions herein contemplated will not
conflict with or constitute a breach of, or default under, the Restated
Articles of Incorporation or by-laws of the Company, the Declaration or the
Certificate of Trust or any mortgage, contract, lease, note or other
instrument to which the Company, any significant subsidiary or the Trust is
a party or by which it, any significant subsidiary or the Trust may be
bound, or any law, administrative regulation or administrative, arbitration
or court order.
(i) The Company has filed with the Illinois Commerce Commission a
petition with respect to the issuance and sale of the Subordinated Debt
Securities and the Guarantees, the purchase of the Common Securities from
the Trust and the Company's participation in the transactions otherwise
contemplated by this Agreement, and said Commission has issued its order
authorizing and approving such transactions. No consent of or approval by
any other public board or body or administrative agency, federal or state,
is necessary to authorize such issue and sale, such investment or such
participation, 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, the Preferred Securities Guarantee Agreement and the Indenture
under the 1939 Act.
-6-
<PAGE>
(j) There is no pending or threatened suit or proceeding before any
court or governmental agency, authority or body or any arbitration
involving the Company, any of its significant subsidiaries or the Trust
required to be disclosed in the Prospectus which is not adequately
disclosed in the Prospectus.
(k) This Agreement has been, and at Closing Time the Pricing Agreement
will have been, duly authorized, executed and delivered by each of the
Offerors.
(l) 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 the description thereof contained in the
Prospectus; the issuance of the Common Securities is not subject to
preemptive or other similar rights; and at 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.
(m) The Declaration has been duly authorized by the Company and, at
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 Closing Time,
be a valid and binding obligation of the Company and the Regular Trustees,
enforceable against the Company and the Regular 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 the
description thereof in the Prospectus; and at Closing Time, the Declaration
will have been duly qualified under the 1939 Act.
(n) Each of the Guarantee Agreements has been duly authorized by the
Company and, when validly executed and delivered by the Company, and, in
the case of the Preferred Securities Guarantee Agreement, assuming due
authorization, execution and delivery of the Preferred Securities Guarantee
by the Guarantee Trustee, will constitute a
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<PAGE>
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 the Bankruptcy Exceptions, and each of the
Guarantees and the Guarantee Agreements will conform to the description
thereof contained in the Prospectus; and the Preferred Securities Guarantee
Agreement, at Closing Time, will have been duly qualified under the 1939
Act.
(o) 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 the
description thereof contained in the Prospectus; the issuance of the
Preferred Securities is not subject to preemptive or other similar rights;
and (subject to the terms of the Declaration) holders of Preferred
Securities will be entitled to the same limitation of personal liability
under Delaware law as extended to stockholders of private corporations for
profit organized under the Delaware General Corporation Law.
(p) 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 the Bankruptcy Exceptions; the Indenture will conform to the
description thereof contained in the Prospectus; and at Closing Time, the
Indenture will have been duly qualified under the 1939 Act.
(q) The Subordinated Debt Securities have been duly authorized by the
Company and, at 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 except to the extent
that enforcement thereof may be limited by the Bankruptcy Exceptions, will
be in the form contemplated by, and entitled to the benefits of, the
Indenture and will conform to the description thereof in the Prospectus.
(r) The Company's obligations under the Guarantees are subordinate and
junior in right of payment to all liabilities of the Company
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and are pari passu with the most senior preferred stock issued by the
Company.
(s) 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.
(t) Each of the Regular Trustees of the Trust is an employee of the
Company and has 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 except to the extent that enforcement thereof may be limited by the
Bankruptcy Exceptions.
(u) 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").
(v) The Company is a "holding company" within the meaning of the
Public Utility Holding Company Act of 1935, as amended, but the Company and
its subsidiaries are exempt from the provisions of that Act, except Section
9(a)(2) thereof, and such exemption is in full force and effect and the
Company is not aware of any existing or proposed proceedings contemplating
the revocation or modification of such exemption.
(w) The franchise granted to the Company by the City Council of the
City of Chicago under an ordinance effective January 1, 1992, is valid and
subsisting and duly authorizes the Company to engage in the electric
utility business conducted by it in such City; and the several franchises
of the Company outside of the City of Chicago are valid and subsisting and
authorize the Company to carry on its utility business in the several
communities, capable of granting franchises, located in the territory
served by the Company outside the City of Chicago.
(x) Subject to certain immaterial exceptions, the Company has good and
sufficient title to the principal plants and properties purported to be
owned by it, subject to the lien of the Company's Mortgage dated July 1,
1923, as amended and supplemented (the "Mortgage"), and subject to
permitted liens as defined in said Mortgage.
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(y) Except for changes contemplated by the Prospectus, the authorized
and outstanding capital stock of the Company is as set forth in the
Prospectus.
(z) 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.
Any certificate signed by any officer or trustee of the Offerors and
delivered to you or to counsel for the Underwriters shall be deemed a joint and
several representation and warranty by the Offerors to each Underwriter as to
the matters covered thereby.
3. Purchase, Offering and Delivery -- Closing Time. (a) Subject to
the terms and conditions herein set forth, the Trust agrees to sell to each
Underwriter, and each Underwriter agrees, severally and not jointly, to purchase
from the Trust at the purchase price set forth in the Pricing Agreement, the
number of Preferred Securities set forth opposite such Underwriter's name in
Schedule A hereto (except as otherwise provided in the Pricing Agreement), plus
any additional number of Preferred Securities that such Underwriter may become
obligated to purchase pursuant to the provisions of Section 9 hereof. The
purchase price per security to be paid by the several Underwriters for the
Preferred Securities shall be an amount equal to the initial public offering
price. The initial public offering price per Preferred 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 fourteenth
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 Preferred 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 Preferred Security determined by
agreement between the Representative and the Company for the Preferred
Securities to be delivered by the Trust hereunder at Closing. The commission,
when so determined, shall be set forth in the Pricing Agreement.
(b) Payment of the purchase price for, and delivery of certificates
for, the Preferred Securities shall be made at the office of Sidley & Austin, or
at such other
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place as shall be agreed upon by the Representative and the Trust, at 10:00 A.M.
Chicago time on the fifth business day (unless postponed in accordance with the
provisions of Section 9) 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 and the Company (such time and date of payment and
delivery being herein called "Closing Time"). 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 Preferred
Securities to be purchased by them. Certificates for the Preferred Securities
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. 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 Preferred Securities 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 Preferred Securities to be purchased by any Underwriter whose
check has not been received by the Closing Time, but such payment shall not
relieve such Underwriter from its obligations hereunder.
The certificate(s) for the Preferred Securities 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.
At Closing Time, the Company will pay, or cause to be paid, the
commission payable at such time to the Underwriters under this Section 3 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.
(c) In accordance with Rule 15c6-1(d) promulgated under the 1934 Act,
the Underwriters agree to the payment of funds and delivery of the Preferred
Securities in accordance with this Section 3 in lieu of that required by
paragraphs (a) and (c) of Rule 15c6-1 under the 1934 Act.
4. Agreements. Each of the Offerors jointly and severally agrees
with the several Underwriters that:
(a) 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
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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 may reasonably object.
Subject to the foregoing, the Offerors will promptly prepare a supplement
to the Prospectus to reflect the terms of the Preferred Securities and the
terms of the offering. The Offerors will file the Prospectus as so
supplemented pursuant to Rule 424(b) under the 1933 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 1933 Act.
(b) The Offerors will promptly advise the Representative (i) when the
Registration Statement and any amendment thereto (including any post-
effective amendment) shall have become effective, (ii) of the receipt of
any comments from the Commission, (iii) of any request by the Commission
for any amendment of the Registration Statement or amendment or supplement
to the Prospectus or for any additional information, (iv) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any proceeding
for that purpose and (v) of the receipt by the Company of any notification
with respect to the suspension of the qualification of the Preferred
Securities for sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose. The Offerors will use their best efforts
to prevent the issuance of any such stop order and, if issued, to obtain as
soon as possible the withdrawal thereof.
(c) If, at any time when a prospectus relating to the Preferred
Securities is required to be delivered under the 1933 Act, any event occurs
as a result of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it shall be
necessary to amend or supplement the Registration Statement or the
Prospectus to comply with the 1933 Act or the 1934 Act or the rules and
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regulations of the Commission under such Acts, the Offerors promptly will
prepare and file with the Commission, subject to paragraph (a) of this
Section 4, an amendment or supplement which will correct such statement or
omission or an amendment or supplement which will effect such compliance.
(d) The Company will make generally available to the Trust's security
holders and to the Representative a consolidated earnings statement (which
need not be audited) of the Company for the 12-month period beginning on
October 1, 1995, as soon as practicable after the end of such 12-month
period, which will satisfy the provisions of Section 11(a) of the 1933 Act.
(e) The Company will furnish without charge to (A) each of the
Representative and counsel for the Underwriters a signed copy of the
Registration Statement (but without exhibits incorporated by reference), as
originally filed, all amendments thereto filed prior to Closing Time and
all Incorporated Documents (including exhibits, other than exhibits
incorporated by reference), (B) each other Underwriter a conformed copy of
the Registration Statement (but without exhibits), as originally filed, all
amendments thereto (but without exhibits) and all Incorporated Documents
(but without exhibits other than the Company's latest Annual Report to
shareholders) and (C) each Underwriter as many copies of the Prospectus
and, so long as delivery of a prospectus or supplement thereto by an
Underwriter or dealer may be required under the 1933 Act, any amendments
thereof and supplements thereto (but without Incorporated Documents or
exhibits), as soon as available and in such quantities as the
Representative may reasonably request.
(f) The Offerors will use their best efforts to arrange for the
qualification of the Preferred Securities (and the Preferred Securities
Guarantee) and the Subordinated Debt Securities for sale under the laws of
such jurisdictions as the Representative may designate (provided, however,
that none of the Offerors shall be obligated to qualify as a foreign
corporation in, or to execute or file any general consent to service of
process under the laws of, any jurisdiction), will maintain such
qualifications in effect so long as required for the distribution of the
Preferred Securities and will arrange for the determination of the legality
of the Preferred Securities for purchase by institutional investors.
(g) Whether or not the transactions contemplated hereunder are
consummated or this Agreement is terminated, the Company will pay all
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costs and expenses incident to the performance of the obligations of the
Offerors hereunder, including, but not limited to, (i) the printing and
filing of the Registration Statement as originally filed and of each
amendment thereto, (ii) all costs, taxes and expenses incident to the issue
and delivery of the Preferred Securities to the Underwriters, (iii) the
fees and disbursements of the Company's and the Trustee's counsel and
accountants, (iv) the qualification of the Preferred Securities, the
Preferred Securities Guarantee and the Subordinated Debt Securities under
securities laws in accordance with the provisions of Section 4(f) hereof
(including fees of counsel for the Underwriters not exceeding $2,000 and
disbursements) incurred in connection with "Blue Sky" qualifications, (v)
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 (except the cost of amending or supplementing the
Prospectus after ninety days following the Closing Time, which shall be at
the expense of the Underwriters requesting same), (vi) the fee of the
National Association of Securities Dealers, Inc., (vii) 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, (viii) the fees and expenses of the Property
Trustee and the Guarantee Trustee, including the fees and disbursements of
counsel for the Property Trustee in connection with the Declaration and the
Certificate of Trust, (ix) any fees payable in connection with the rating
of the Preferred Securities and Subordinated Debt Securities, (x) the fees
and expenses incurred in connection with the listing of the Preferred
Securities (and the related Preferred Securities Guarantee) and, if
applicable, the Subordinated Debt Securities on the New York Stock
Exchange, (xi) the cost and charges of any transfer agent or registrar and
(xii) the cost of qualifying the Preferred Securities with The Depository
Trust Company. Except as provided in this Section 4(g), Section 7 and
Section 8 hereof, the Underwriters will pay all their own costs and
expenses, including the fees of their counsel and any advertising expenses
in connection with any offer they may make.
(h) The Offerors will use best efforts to effect the listing of the
Preferred Securities (including the Preferred Securities Guarantee with
respect thereto) on the New York Stock Exchange; if the Preferred
Securities are exchanged for Subordinated Debt Securities, the Company will
use its best efforts to effect the listing of the Subordinated Debt
Securities on the exchange on which the Preferred Securities were then
listed.
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<PAGE>
(i) During a period of 30 days from the date of the Pricing Agreement,
neither the Trust nor the Company will offer, sell, contract 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 the Subordinated Debt Securities or
any debt securities substantially similar to the Subordinated Debt
Securities or equity securities substantially similar to the Preferred
Securities (except for the Subordinated Debt Securities and the Preferred
Securities issued pursuant to this Agreement), without the prior written
consent of the Representative.
5. Conditions to the Obligations of the Underwriters. The
obligations of the several Underwriters to purchase and pay for the Preferred
Securities shall be subject to the accuracy of the representations and
warranties on the part of the Offerors contained herein as of the date hereof
and Closing Time, to the accuracy of the statements of the Offerors made in any
certificates pursuant to the provisions hereof, to the performance by the
Offerors of their obligations hereunder and to the following additional
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 Act Regulations and in accordance
with Section 4(a) hereof and prior to Closing Time the Offerors shall have
provided evidence satisfactory to the Representative of such timely filing.
(b) The Offerors shall have furnished to the Representative the
opinion of Sidley & Austin, counsel for the Offerors, at Closing Time, to
the effect that:
(i) the Company is a validly organized and existing corporation
in good standing under the laws of the State of Illinois;
(ii) to our knowledge, the Trust is not a party to or otherwise
bound by any agreement other than those described in the Prospectus;
and the Trust is duly qualified and in good standing as a foreign
company in any other jurisdiction in which such
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<PAGE>
qualification is 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 Trust;
(iii) the issue and sale of the Subordinated Debt Securities and
the execution and delivery of the Guarantees by the Company in
accordance with the terms of this Agreement, the Company's purchase of
the Common Securities from the Trust and the Company's participation
in the transactions otherwise contemplated by this Agreement have been
duly and validly authorized by the necessary corporate action of the
Company and by order duly entered by the Illinois Commerce Commission;
and no authorization, approval, consent, certificate or order of any
other state commission or regulatory authority (other than under any
applicable state securities or blue sky laws, as to which said counsel
need express no opinion) or of any federal commission or regulatory
authority is required in respect of such issue and sale, such purchase
or such participation, except (a) such as may be required under the
1933 Act or the 1933 Act Regulations and (b) the qualification of the
Declaration, the Preferred Securities Guarantee Agreement and the
Indenture under the 1939 Act and 1939 Act Regulations;
(iv) the Registration Statement has become effective under the
1933 Act and, to the knowledge of said counsel, no proceedings for a
stop order are pending or threatened under Section 8(d) or 8(e) of the
1933 Act;
(v) the Registration Statement, as of its effective date, and the
Prospectus, in the form first used by the Underwriters to confirm
sales of the Preferred Securities (or as amended or supplemented, if
applicable) (except, in each case, as to the financial statements,
financial data, statistical data and supporting schedules contained or
incorporated therein, with respect to which said counsel need express
no opinion), comply as to form, in all material respects, with the
1933 Act, the 1934 Act, the 1939 Act and the rules and regulations of
the Commission under such Acts; and the Incorporated Documents (except
as to the financial statements, financial data, statistical data and
supporting schedules contained or incorporated therein, with respect
to which said counsel need express no opinion), as of their respective
dates of filing with the Commission, complied as to form, in all
material respects, with the 1934 Act and the rules and regulations of
the Commission thereunder;
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<PAGE>
(vi) the execution and delivery of this Agreement and the Pricing
Agreement by the Company have been duly authorized by the necessary
corporate action; and this Agreement and the Pricing Agreement have
been duly executed and delivered by the Company;
(vii) the Declaration has been duly authorized, executed and
delivered by the Company, as sponsor, and has been duly executed and
delivered by each of the Regular Trustees;
(viii) the statements in the Prospectus under the captions "Risk
Factors," "Description of the Preferred Securities," "Description of
the Preferred Securities Guarantee," "Description of the Subordinated
Notes" and "Effect of Obligations Under the Subordinated Notes and the
Preferred Securities Guarantee," insofar as they pertain to
obligations of the Offerors and insofar as they purport to summarize
certain provisions of the documents referred to under said captions,
have been reviewed by them and constitute fair and accurate summaries
of such provisions; and the Declaration, the Indenture and the
Preferred Securities Guarantee Agreement filed with the Commission as
part of the Registration Statement complied as to form in all material
respects with the applicable requirements of the 1939 Act and the 1939
Act Regulations;
(ix) the Common Securities, the Preferred Securities, the
Subordinated Debt Securities, each of the Guarantees, the Declaration,
the Indenture and each of the Guarantee Agreements conform in all
material respects to the descriptions thereof contained in the
Prospectus and such descriptions fairly set forth the matters
respecting the Common Securities, the Preferred Securities, the
Subordinated Debt Securities, each of the Guarantees, the Declaration,
the Indenture and each of the Guarantee Agreements required under the
applicable provisions of the federal securities laws to be set forth
in the Prospectus;
(x) all of the issued and outstanding Common Securities of the
Trust are owned of record by the Company free and clear, to our
knowledge, of any security interest, mortgage, pledge, lien,
encumbrance, claim or equitable right;
(xi) the Declaration has been duly qualified under the 1939 Act;
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(xii) each of the Guarantee Agreements has been duly authorized,
executed and delivered by the Company; the Preferred Securities
Guarantee Agreement, assuming it is duly authorized, executed and
delivered by the Guarantee 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;
(xiii) the Indenture has been duly authorized, 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 against the Company 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;
(xiv) the Subordinated Debt Securities are in the form
contemplated by the Indenture, have been duly authorized, executed and
delivered by the Company and, when authenticated by the Debt Trustee
in the manner provided for in the Indenture and delivered against
payment therefor as provided in this Agreement, will constitute valid
and binding obligations of the Company, enforceable against the
Company in accordance with their terms and entitled to the benefits
provided by the Indenture, except to the extent that enforcement
thereof may be limited by the Bankruptcy Exceptions; and, subject to
like exception contained in the immediately preceding clause, the
holder or holders of the Subordinated Debt Securities will be entitled
to the payment of principal and interest as therein provided;
(xv) the Subordinated Debt Securities are subordinate and junior
in right of payment to all "Senior Indebtedness" (as defined in the
Supplemental Indenture) of the Company;
(xvi) 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;
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(xvii) subject to certain immaterial exceptions, the Company has
good and sufficient title to the principal plants and properties
purported to be owned by it, subject to the lien of the Mortgage and
to permitted liens as defined in said Mortgage;
(xviii) the franchise granted to the Company by the City Council
of the City of Chicago under an ordinance effective January 1, 1992,
is valid and subsisting and duly authorizes the Company to engage in
the electric utility business conducted by it in such City; the
several franchises of the Company outside the City of Chicago are
valid and subsisting and authorize the Company to carry on its utility
business in the several communities, capable of granting franchises,
located in the territory served by the Company outside the City of
Chicago;
(xix) to the knowledge of said counsel, (a) there are no
material pending legal proceedings to which the Company or the Trust
is a party or of which property of the Company or the Trust is the
subject and which are required to be set forth in the Prospectus and
(b) there are no such proceedings contemplated by governmental
authorities, in each case other than those referred to in the
Prospectus;
(xx) none of the Offerors is an "investment company" or a company
"controlled" by an "investment company" within the meaning of the 1940
Act;
(xxi) the Company is a "holding company" within the meaning of
the Public Utility Holding Company Act of 1935, as amended, but the
Company and its subsidiaries are exempt from the provisions of such
Act, except Section 9(a)(2) thereof, and such exemption is in full
force and effect and, to our knowledge, there are no existing or
overtly threatened proceedings contemplating the revocation or
modification of such exemption;
(xxii) for federal income tax purposes (i) the Subordinated Debt
Securities will constitute indebtedness of the Company and (ii) the
interest on the Subordinated Debt Securities will be deductible by the
Company on an economic accrual basis in accordance with section 163(e)
of the Internal Revenue Code of 1986, as amended, and Treasury
Regulation section 1.163-7;
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(xxiii) under current law, the Trust will be classified for
United States federal income tax purposes as a grantor trust and not
as an association taxable as a corporation; accordingly, for United
States federal income tax purposes, each holder of Preferred
Securities generally will be considered the owner of an undivided
interest in the Subordinated Debt Securities, and each holder will be
required to include in its gross income any original issue discount
accrued with respect to its allocable share of the Subordinated Debt
Securities;
(xxiv) the discussion set forth in the Prospectus under the
caption "Certain Federal Income Consequences" is a fair and accurate
summary of the matters addressed therein, based upon current law and
the assumption stated or referred to therein; and
(xxv) the statements, if any, contained or incorporated by
reference in the Prospectus which are expressed therein to have been
made on the authority of said counsel are, as to matters of law and
legal conclusions, correct in all material respects; nothing has come
to the attention of said counsel which causes them to believe that the
Registration Statement or any amendment thereof (including the filing
of any annual report on Form 10-K) at the time it became effective
(except as to the financial statements, financial data, statistical
data and supporting schedules contained or incorporated therein, with
respect to which said counsel need express no opinion) contained an
untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus as amended or
supplemented at the time it was filed pursuant to Rule 424 under the
1933 Act contained, or as amended or supplemented as of the Closing
Time (except as to the financial statements, financial data,
statistical data and supporting schedules contained or incorporated
therein, with respect to which said counsel need express no opinion)
contains, an untrue statement of a material fact, or omitted 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; and to the knowledge of said counsel, there are no
contracts or exhibits required to be filed with the Registration
Statement which are not so filed.
In giving its opinion, Sidley & Austin may rely as to certain
matters of Delaware law upon the opinion of Richards, Layton &
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Finger, special counsel to the Offerors, which shall be delivered in
accordance with Section 5(c)(i) hereto.
(c) (i) The Representative shall have received the favorable
opinion, at Closing Time, of Richards, Layton & Finger, special counsel to
the Offerors, in form and substance satisfactory to counsel for the
Underwriters, to the effect that,
(i) the Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Act, and all
filings required under the laws of the State of Delaware with respect
to the creation and valid existence of the Trust as a business trust
have been made;
(ii) under the Delaware Act and the Declaration, the Trust has
the power and authority to own property and conduct its business, all
as described in the Registration Statement and the Prospectus;
(iii) the Declaration constitutes a valid and binding obligation
of the Company and the Trustees and is enforceable against the Company
and the Trustees in accordance with its terms, except to the extent
that the enforcement thereof may be limited by the Bankruptcy
Exceptions;
(iv) under the Delaware Act and the Declaration, the Trust has
the power and authority to (i) execute and deliver, and to perform its
obligations under, this Agreement and the Pricing Agreement and (ii)
issue, and perform its obligations under, the Trust Securities;
(v) under the Delaware Act and the Declaration, the execution
and delivery by the Trust of this Agreement, the Pricing Agreement and
the performance by the Trust of its obligations hereunder and under
the Pricing Agreement, have been duly authorized by all necessary
action on the part of the Trust;
(vi) the certificates for the Preferred Securities are in due
and proper form; the Preferred Securities have been duly authorized by
the Declaration and are duly and validly issued and, subject to
qualifications hereinafter expressed in this paragraph (vi), fully
paid and nonassessable undivided beneficial interests in the assets of
the Trust; the holders of the Preferred Securities, as beneficial
owners
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of the Trust, will be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit
organized under the General Corporation Law of the State of Delaware;
said counsel may note that the holders of the Preferred Securities may
be obligated, pursuant to the Declaration, to (i) provide indemnity
and/or security in connection with, and pay taxes or governmental
charges arising from, transfers or exchanges of Preferred Securities
certificates and the issuance of replacement Preferred Securities
certificates and (ii) provide security and indemnity in connection
with requests of or directions to the Property Trustee to exercise its
rights and remedies under the Declaration;
(vii) the Common Securities have been duly authorized by the
Declaration and are duly and validly issued and fully paid and, except
as otherwise provided in Section 10.1(b) of the Declaration,
nonassessable undivided beneficial interests in the assets of the
Trust;
(viii) under the Delaware Act and Declaration the issuance of
the Trust Securities is not subject to preemptive or other similar
rights; and
(ix) the issuance and sale by the Trust of the Trust Securities,
the purchase by the Trust of the Subordinated Debt Securities, the
execution, delivery and performance by the Trust of this Agreement and
the Pricing Agreement, the consummation by the Trust of the
transactions contemplated hereby and by the Pricing Agreement and
compliance by the Trust with its obligations hereunder and thereunder
will not violate (i) any of the provisions of the Certificate of Trust
or the Declaration or (ii) any applicable Delaware law or
administrative regulation.
(ii) The Representative shall have received the favorable
opinion, at Closing Time, of Richards, Layton & Finger, counsel of
Wilmington Trust Company, as Property Trustee under the Declaration,
Guarantee Trustee under the Preferred Securities Guarantee Agreement, in
form and substance satisfactory to counsel for the Underwriters, to the
effect that,
(i) Wilmington Trust Company is duly organized and is validly
existing in good standing as a banking corporation under the laws of
the State of Delaware.
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<PAGE>
(ii) the Property Trustee has full power, authority and legal right
to execute, deliver and perform its obligations under the terms of the
Declaration and the Preferred Securities Guarantee Agreement;
(iii) the execution, delivery and performance by the Property
Trustee of the Declaration and the execution, delivery and performance
by the Guarantee Trustee of the Preferred Securities Guarantee
Agreement have been duly authorized by all necessary corporate action
on the part of the Property Trustee and the Guarantee Trustee,
respectively. The Declaration and the Preferred Securities Guarantee
Agreement have been duly executed and delivered by the Property
Trustee and the Guarantee Trustee, respectively, and constitute the
legal, valid and binding obligations of the Property Trustee and the
Guarantee Trustee, respectively, enforceable against the Property
Trustee and the Guarantee Trustee, respectively, in accordance with
their terms, except as enforcement thereof may be limited by the
Bankruptcy Exceptions;
(iv) the execution, delivery and performance of the Declaration
and the Preferred Securities Guarantee Agreement by the Property
Trustee and the Guarantee Trustee, respectively, does not conflict
with or constitute a breach of the charter or by-laws of the Property
Trustee and the Guarantee Trustee, respectively; and
(v) no consent, approval or authorization of, or registration
with or notice to, any governmental authority or agency of the State
of Delaware or the United States of America governing the banking or
trust powers of Wilmington Trust Company is required for the
execution, delivery or performance by the Property Trustee and the
Guarantee Trustee of the Declaration and the Preferred Securities
Guarantee Agreement.
(iii) The Representative shall have received the favorable opinion,
at Closing Time, of [Skadden, Arps, Slate, Meagher & Flom
("SASM&F")/Winston & Strawn ("W&S")], counsel for the Underwriters, in form
and substance satisfactory to the Underwriters with respect to the
incorporation and legal existence of the Company; the legal existence of
the Trust, the Preferred Securities, the Indenture, the Preferred
Securities Guarantee Agreement, this Agreement, the Pricing Agreement, the
Registration Statement, the Prospectus and other related matters as the
Representative may require.
-23-
<PAGE>
In giving its opinion, SASM&F/W&S may rely as to certain matters of
Delaware law upon the opinion of Richards, Layton & Finger, special counsel
for the Offerors, which shall be delivered in accordance with Section
5(c)(i) hereto.
(d) At Closing Time, there shall not have been, since the respective
dates as of which information is given in the Registration Statement and
the Prospectus (in the form first used by the Underwriters to confirm sales
of the Preferred Securities), any material adverse change in the condition,
financial or otherwise, of the Trust or of the Company and its subsidiaries
considered as one enterprise, or in the earnings, affairs or business
prospects of the Company and its subsidiaries considered as one enterprise,
in either case whether or not arising in the ordinary course of business,
and you shall have received a certificate of the Chairman, the President, a
Vice President or the Treasurer of the Company and a certificate of a
Regular Trustee of the Trust, each at Closing Time, to the effect that (i)
there has been no such material adverse change, (ii) the representations
and warranties contained in this Agreement are true and correct with the
same force and effect as though expressly made at and as of Closing Time,
(iii) the Company and the Trust have complied with all agreements and
satisfied all conditions on their 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, to his knowledge, threatened by the
Commission.
(e) (i) At the time of the execution of this Agreement, the
Representative shall receive from Arthur Andersen LLP a letter (in form and
substance satisfactory to them) dated such date to the effect that they are
independent public accountants within the meaning of the 1933 Act and the
applicable published rules and regulations thereunder and that the answer
to Item 10 of the Registration Statement is correct insofar as it relates
to them, and stating in effect that (i) in their opinion, the consolidated
financial statements examined by them and contained in the Incorporated
Documents comply as to form in all material respects with the applicable
accounting requirements of the 1934 Act and the published rules and
regulations thereunder; (ii) on the basis of a reading of the latest
available unaudited interim consolidated financial statements of the
Company, a reading of all recent minutes of meetings of the Board of
Directors, Committees of the Board of Directors and shareholders of the
Company and its subsidiaries and inquiries of officials of the Company
responsible for financial and accounting matters, nothing came to their
-24-
<PAGE>
attention which caused them to believe that as of a specified date not more
than three business days prior to the date of delivery of such letter there
was any decrease in the capital stock or any increase in the long-term debt
of the Company and subsidiaries consolidated, or any decrease in
consolidated net assets, as compared with amounts shown in the consolidated
balance sheet or consolidated statement of capitalization examined by them
and included in the Company's Annual Report on Form 10-K, Quarterly Report
on Form 10-Q or Current Report on Form 8-K, as the case may be, last filed
under the 1934 Act and incorporated by reference in the Registration
Statement or for the period from the first day of the month next following
the date of said consolidated balance sheet and said consolidated statement
of capitalization to a specified date not more than three business days
prior to the date of delivery of such letter there were any decreases, as
compared with the corresponding period in the preceding year, in
consolidated electric operating revenues, net income, net income on common
stock or earnings per common share, except in all instances for changes
which the Prospectus discloses have occurred or may occur or which are
described in such letter; (iii) they have read the dollar amounts of
electric operating revenues by user classification in the table "Operating
Statistics" in the Company's Annual Report on Form 10-K last filed under
the 1934 Act and incorporated by reference in the Registration Statement,
have performed specified procedures with respect thereto set forth in such
letter and have found such dollar amounts to be in agreement with
accounting records identified in such letter; (iv) if applicable, they have
read the dollar amount of short-term notes payable and the ratio of
earnings to fixed charges and the ratio of earnings to fixed charges and
preferred and preference stock dividend requirements set forth in the
Prospectus have performed specified procedures with respect thereto set
forth in such letter and have found such dollar amount and ratios to be in
agreement with accounting records identified in such letter; and (v) they
have read any unaudited consolidated financial statement information and
financial ratios set forth in the Prospectus and have performed specified
procedures with respect thereto set forth in such letter, and nothing came
to their attention which caused them to believe that such financial
information does not agree with the latest available unaudited interim
consolidated financial statements of the Company or was not determined on a
basis substantially consistent with that of the corresponding amounts in
the audited consolidated financial statements incorporated by reference in
the Registration Statement. If additional unaudited consolidated financial
information is included in the Prospectus, appropriate statements with
respect thereto shall also be set forth in such letter.
-25-
<PAGE>
(ii) At Closing Time, the Representative shall have received from
Arthur Andersen LLP a letter, dated as of Closing Time, to the effect that
they reaffirm the statements made in the letter furnished pursuant to
Section 5(e)(i), except that the specified date referred to shall be a date
not more than five days prior to Closing Time.
(f) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, there shall not
have been any change or decrease specified in the letters referred to in
paragraph (e) of this Section 5 which makes it impractical or inadvisable
in the judgment of the Representative to proceed with the public offering
or delivery of the Preferred Securities as contemplated by the Prospectus.
(g) 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 organization" as that term is defined by the Commission
for purposes of Rule 436(g)(1) of Regulation C under the 1933 Act, and the
Trust shall have delivered to the Representative a letter, at Closing Time,
from such nationally recognized statistical rating organization, or other
evidence satisfactory to the Representative, confirming that the Preferred
Securities and the Subordinated Debt Securities have Investment Grade
ratings; and subsequent to the date of this Agreement, no downgrading shall
have occurred in the rating accorded the Company's debt securities or
Cumulative Preference Stock by any such nationally recognized statistical
rating organization, and no such nationally recognized statistical rating
organization shall have publicly announced that it has under surveillance
or review, with possible negative implications, its ratings for such
securities.
(h) At Closing Time, the Preferred Securities shall have been approved
for listing on the New York Stock Exchange upon notice of issuance.
(i) Prior to Closing Time, the Offerors shall have furnished to the
Representative such further information, certificates and documents as the
Representative may reasonably request.
If any of the conditions specified in this Section 5 shall not have
been fulfilled when and as provided in this Agreement, or if any of the opinions
or certificates mentioned above or elsewhere in this Agreement shall not be in
all material respects reasonably satisfactory in form and substance to the
Representative and counsel for the
-26-
<PAGE>
Underwriters, this Agreement and all obligations of the Underwriters hereunder
may be canceled at, or at any time prior to, Closing Time by the Representative.
6. Conditions of the Trust's Obligation. The obligation of the
Trust to deliver the Preferred Securities upon payment therefor shall be subject
to the following conditions:
At Closing Time, the order of the Illinois Commerce Commission
referred to in subparagraph (i) of Section 2 shall be in full force and effect
substantially in the form in which originally entered and no stop order
suspending the effectiveness of the Registration Statement shall be in effect
and no proceedings for that purpose shall then be pending before, or threatened
by, the Commission.
In case any of the conditions specified above in this Section 6 shall
not have been fulfilled, this Agreement may be terminated by the Offerors by
delivering written notice of termination to the Representative. Any such
termination shall be without liability of any party to any other party except to
the extent provided in Sections 4(g), 7 and 8 hereof.
7. Reimbursement of Underwriters' Expenses. If the sale of the
Preferred Securities provided for herein is not consummated because any
condition to the obligations of the Underwriters or the Offerors set forth in
Section 5 and Section 6 hereof, respectively, is not satisfied or because of any
refusal, inability or failure on the part of the Offerors, or either of them, to
perform any agreement herein or comply with any provisions hereof other than by
reason of a default by any of the Underwriters, the Company will reimburse the
Underwriters severally upon demand for all out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been incurred by
them in connection with the proposed purchase and sale of the Preferred
Securities.
8. Indemnification and Contribution. (a) The Offerors agree jointly
and severally to indemnify and hold harmless each Underwriter and each person
who controls any Underwriter within the meaning of either the 1933 Act or the
1934 Act against any and all losses, claims, damages or liabilities, joint or
several, to which they or any of them may become subject under the 1933 Act, the
1934 Act or other federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement for
the registration of the Securities as originally filed or in any amendment
thereof, or in any preliminary prospectus or the Prospectus, or in any amendment
thereof or supplement thereto, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or
-27-
<PAGE>
necessary to make the statements therein not misleading, and agrees to reimburse
each such indemnified party for any legal or other expenses reasonably incurred
by them in connection with investigating or defending any such loss, claim,
damage, liability or action as such expenses are incurred; provided, however,
that (i) the Offerors will not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged omission
made therein in reliance upon and in conformity with written information
furnished to the Trust or the Company by or on behalf of any Underwriter through
the Representative specifically for use therein and (ii) such indemnity with
respect to any preliminary prospectus shall not inure to the benefit of any
Underwriter (or any person controlling such Underwriter) from whom the person
asserting any such loss, claim, damage or liability purchased any of the
Preferred Securities which are the subject thereof if such person did not
receive a copy of the Prospectus (or, if the Prospectus has been amended or
supplemented, the Prospectus as then amended or supplemented), excluding the
Incorporated Documents, at or prior to the confirmation of the sale of such
Preferred Securities to such person in any case where such delivery is required
by the 1933 Act and the untrue statement or omission of a material fact
contained in such preliminary prospectus was corrected in the Prospectus (or the
Prospectus as then amended or supplemented) and where the Offerors shall have
provided to the Representative in a timely manner sufficient copies of such
Prospectus. This indemnity agreement will be in addition to any liability which
the Offerors may otherwise have. The Company agrees to indemnify the Trust
against all loss, liability, claim, damage and expense whatsoever, as due from
the Trust under Section 8(a) hereunder.
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Offerors, their directors, trustees, their officers who sign the
Registration Statement and each person who controls the Offerors within the
meaning of either the 1933 Act or the 1934 Act, to the same extent as the
foregoing indemnity from the Offerors to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the
Offerors by or on behalf of such Underwriter through the Representative
specifically for use in the preparation of the documents referred to in the
foregoing indemnity. This indemnity agreement will be in addition to any
liability which any Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section
8 of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve it from
any liability which it may have to any indemnified party otherwise than under
this Section 8. In case any such action is brought against any indemnified
party, and it notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein and,
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<PAGE>
to the extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof, with counsel satisfactory to such indemnified
party, unless the defendants in any such action include both the indemnified
party and the indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it and/or other
indemnified parties which are different from or additional to those available to
the indemnifying party. Upon receipt of notice from the indemnifying party to
such indemnified party of its election so to assume the defense of such action
and approval by the indemnified party of counsel, the indemnifying party will
not be liable to such indemnified party under this Section 8 for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof unless (i) the indemnified party shall have employed
separate counsel in connection with the assertion of legal defenses in
accordance with the next preceding sentence (it being understood, however, that
in no event shall the indemnifying party be liable for the fees and expenses of
more than one separate counsel (in addition to local counsel), approved by the
Representative in the case of subparagraph (a), representing 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), (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party; and except that, if clause (i)
or (iii) is applicable, such liability shall be only in respect of the counsel
referred to in such clause (i) or (iii).
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in paragraphs (a) or (b)
of this Section 8 is due in accordance with its terms but is for any reason held
by a court to be unavailable on grounds of policy or otherwise, the Offerors and
the Underwriters shall contribute to the aggregate losses, expenses, claims,
damages and liabilities (including legal or other expenses reasonably incurred
in connection with investigating or defending same) to which the Offerors and
one or more of the Underwriters may be subject in such proportion so that the
Underwriters are responsible for that portion represented by the percentage that
the aggregate underwriting discounts appearing on the cover page of the
Prospectus bear to the aggregate public offering price for the Preferred
Securities appearing thereon and the Offerors are responsible for the balance;
provided, however, that (i) in no case shall any Underwriter (except as may be
provided in any Agreement Among Underwriters) be responsible for any amount in
excess of the aggregate underwriting discounts applicable to the Preferred
Securities purchased by such Underwriter hereunder and (ii) 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
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<PAGE>
Section 8, each person who controls an Underwriter within the meaning of the
1933 Act or the 1934 Act shall have the same rights to contribution as such
Underwriter, and each person who controls the Offerors within the meaning of
either the 1933 Act or the 1934 Act, each officer of the Company who shall have
signed the Registration Statement, each director of the Company and each trustee
of the Trust shall have the same rights to contribution as the Offerors, subject
in each case to clauses (i) and (ii) of this paragraph (d). Any party entitled
to contribution will, promptly after receipt of notice of commencement of any
action, suit or proceeding against such party in respect of which a claim for
contribution may be made against another party or parties under this paragraph
(d), notify such party from whom contribution may be sought, but the omission to
so notify such party or parties shall not relieve the party or parties from whom
contribution may be sought from any other obligation it or they may have
hereunder or otherwise than under this paragraph (d).
9. Default by an Underwriter. If any one or more of the
Underwriters shall fail to purchase and pay for the Preferred Securities agreed
to be purchased by such Underwriter or Underwriters hereunder and such failure
to purchase shall constitute a default in the performance of its or their
obligations under this Agreement, the remaining Underwriters shall be obligated
severally to take up and pay for (in the respective proportions which the number
of Preferred Securities set forth opposite their names in Schedule A hereto bear
to the aggregate number of Preferred Securities set opposite the names of all
the remaining Underwriters) the Preferred Securities which the defaulting
Underwriter or Underwriters agreed but failed to purchase; provided, however,
that in the event that the aggregate number of Preferred Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase shall
exceed 10% of the aggregate number of the Preferred Securities set forth in
Schedule A hereto, the remaining Underwriters shall have the right to purchase
all, but shall not be under any obligation to purchase any, of the Preferred
Securities and if such nondefaulting Underwriters do not purchase all the
Preferred Securities, this Agreement will terminate without liability to any
nondefaulting Underwriter or the Offerors, except as provided in Section 11
hereof. In the event of a default by any Underwriter as set forth in this
Section 9, the Closing Time shall be postponed for such period, not exceeding
seven days, as the Representative shall determine, in order that the required
changes in the Registration Statement and the Prospectus or in any other
documents or arrangements may be effected. Nothing contained in this Agreement
shall relieve any defaulting Underwriter of its liability, if any, to the
Offerors and any nondefaulting Underwriter for damages occasioned by its default
hereunder.
10. Termination. This Agreement shall be subject to termination in
the absolute discretion of the Representative, by notice given to the Offerors
prior to delivery of and payment for the Preferred Securities, if prior to such
time (i) there has been, since the date of this Agreement or since the
respective dates as of which information is given
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<PAGE>
in the Registration Statement and the Prospectus, any material adverse change in
the earnings, affairs, condition (financial or otherwise) or business prospects
of the Trust or the Company and its subsidiaries considered as one enterprise,
in either case whether or not arising in the ordinary course of business, (ii)
trading in securities of the Company or securities generally on the New York
Stock Exchange shall have been suspended or limited or minimum or maximum prices
for trading have been fixed, or maximum ranges for prices have been required by
said exchange or by order of the Commission or by order of any other
governmental authority, (iii) a banking moratorium shall have been declared
either by federal or New York State authorities or (iv) there shall have
occurred any outbreak or material escalation of hostilities or other calamity or
crisis, the effect of which on the financial markets of the United States is
such as to make it, in the judgment of the Representative, impracticable to
market the Preferred Securities or enforce contracts for the sale of the
Preferred Securities. As used in this Section, the term "Prospectus" shall mean
the Prospectus in the form first used by the Underwriters to confirm sales of
the Preferred Securities.
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Offerors or their officers or Trustees and of the Underwriters set forth in or
made pursuant to this Agreement will remain in full force and effect, regardless
of any investigation made by or on behalf of any Underwriter or the Offerors or
any of the officers, directors, trustees or controlling persons referred to in
Section 8 hereof, and will survive delivery of and payment for the Preferred
Securities. The provisions of Sections 4(g), 7 and 8 hereof shall survive the
termination or cancellation of this Agreement.
12. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representative, will be mailed,
delivered or telegraphed and confirmed to it at Merrill Lynch World
Headquarters, North Tower, World Financial Center, New York, New York 10281-
1201, attention of John Thorndike, Managing Director, or, if sent to the Trust
or the Company, will be mailed, delivered or telegraphed and confirmed to it, at
the 37th floor, One First National Plaza, Box 767, Chicago, Illinois 60690-0767,
attention of the Treasurer.
13. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and assigns and
the officers, directors, trustees and controlling persons referred to in Section
8 hereof, and no other person will have any right or obligation hereunder. The
term "successors and assigns" as used in this Agreement shall not include any
purchaser, as such purchaser, of any of the Preferred Securities from any of the
Underwriters.
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<PAGE>
14. Representation of the Underwriters. The Representative
represents and warrants to the Offerors that it is authorized to act as the
representative of the Underwriters in connection with this financing, and the
Representative's execution and delivery of this Agreement and any action under
this Agreement taken by such Representative will be binding upon all
Underwriters.
15. Counterparts. This Agreement may be executed in counterparts all
of which, taken together, shall constitute a single agreement among the parties
to such counterparts.
16. Applicable Law. This Agreement will be governed by and construed
in accordance with the laws of the State of Illinois.
-32-
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement between the
Company and the Trust and each of the several Underwriters.
Very truly yours,
COMMONWEALTH EDISON COMPANY
By: ________________________
J.C. Bukovski
Vice President
COMED FINANCING I
By: ________________________
J.C. Bukovski
Trustee
By: ________________________
Dennis F. O'Brien
Trustee
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
MERRILL LYNCH & CO
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
By:______________________________
Name:
Title:
For themselves and the other several
Underwriters named in Schedule A hereto.
-33-
<PAGE>
SCHEDULE A
----------
Number of
Name of Underwriter Preferred Securities
- ------------------- --------------------
Merrill Lynch, Pierce, Fenner &
Smith Incorporated _________
PaineWebber Incorporated _________
Salomon Brothers Inc _________
Total 8,000,000
=========
<PAGE>
EXHIBIT A
---------
_______________ Preferred Securities
ComEd FINANCING I
(a Delaware statutory business trust)
______% Trust Originated Preferred Securities ("TOPrS")
(Liquidation Amount of $25 Per Security)
PRICING AGREEMENT
-----------------
MERRILL LYNCH & CO.
___________,1995
Merrill Lynch, Pierce, Fenner
& Smith Incorporated,
as Representative of the several
Underwriters named in the within-
mentioned Underwriting Agreement
Merrill Lynch World Headquarters
North Tower
World Financial Center
New York, New York 10281
Ladies and Gentlemen:
Reference is made to the Underwriting Agreement, dated ____________,
1995 (the "Underwriting Agreement"), relating to the purchase by the several
Underwriters named in Schedule A thereto (the "Underwriters"), 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 ComEd FINANCING I, a
Delaware statutory business trust (the "Trust").
Pursuant to Section 3 of the Underwriting Agreement, the Trust and
Commonwealth Edison Company, an Illinois corporation (the "Company"), jointly
and severally agree with each Underwriter as follows:
<PAGE>
1. The initial public offering price per security for the Preferred
Securities (as defined in the Underwriting Agreement), determined as
provided in said Section 3, 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.
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 ________.
-2-
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement between the
Company and the Trust and each of the several Underwriters.
Very truly yours,
COMMONWEALTH EDISON COMPANY
By: ________________________
J.C. Bukovski
Vice President
COMED FINANCING I
By: ________________________
J.C. Bukovski
Trustee
By: ________________________
Dennis F. O'Brien
Trustee
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
MERRILL LYNCH & CO
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
By:______________________________
Name:
Title:
For themselves and the other several
Underwriters named in the
Underwriting Agreement.
-3-
<PAGE>
Exhibit (4)-1
Commonwealth Edison Company
Form S-3
File No. 33-
CERTIFICATE OF TRUST
The undersigned, the trustees of ComEd Financing I desiring to form a
business trust pursuant to Delaware Business Trust Act, 12 Del. C. (S) 3810,
hereby certify as follows:
1. The name of the business trust being formed hereby (the "Trust")
is "ComEd Financing I".
2. The name and business address of the trustee of the Trust which
has its principal place of business in the State of Delaware is as follows:
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890
3. This Certificate of Trust shall be effective as of the date of
filing.
Dated: July 19, 1995
/s/ John C. Bukovski
---------------------------------
John C. Bukovski, as Trustee
/s/ Dennis F. O'Brien
---------------------------------
Dennis F. O'Brien, as Trustee
WILMINGTON TRUST COMPANY, as
Trustee
By: /s/ Emmett R. Harmon
------------------------------
Name: Emmett R. Harmon
Title: Vice President
<PAGE>
Exhibit (4)-2
Commonwealth Edison Company
Form S-3
File No. 33-
AMENDED AND RESTATED DECLARATION OF TRUST
COMED FINANCING I
Dated as of ______________, 1995
<PAGE>
TABLE OF CONTENTS
ARTICLE I
INTERPRETATION AND DEFINITIONS.......... 1
SECTION 1.1. Definitions.................................. 1
ARTICLE II
TRUST INDENTURE ACT............... 7
SECTION 2.1. Trust Indenture Act; Application............. 7
SECTION 2.2. Lists of Holders of Securities............... 8
SECTION 2.3. Reports by the Property Trustee.............. 8
SECTION 2.4. Periodic Reports to Property Trustee......... 8
SECTION 2.5. Evidence of Compliance with Conditions
Precedent.................................. 8
SECTION 2.6. Events of Default; Waiver.................... 9
SECTION 2.7. Event of Default; Notice..................... 10
ARTICLE III
ORGANIZATION.................. 11
SECTION 3.1. Name......................................... 11
SECTION 3.2. Office....................................... 11
SECTION 3.3. Purpose...................................... 11
SECTION 3.4. Authority.................................... 11
SECTION 3.5. Title to Property of the Trust............... 11
SECTION 3.6. Powers and Duties of the Regular
Trustees................................... 12
SECTION 3.7. Prohibition of Actions by the Trust
and the Trustees........................... 15
SECTION 3.8. Powers and Duties of the Property
Trustee.................................... 15
SECTION 3.9. Certain Duties and Responsibilities of the
Property Trustee........................... 17
SECTION 3.10. Certain Rights of Property Trustee.......... 19
SECTION 3.11. Delaware Trustee............................ 21
SECTION 3.12. Execution of Documents...................... 21
SECTION 3.13. Not Responsible for Recitals or Issuance
of Securities............................. 22
SECTION 3.14. Duration of Trust........................... 22
SECTION 3.15. Mergers..................................... 22
ARTICLE IV
SPONSOR..................... 23
SECTION 4.1. Sponsor's Purchase of Common Securities...... 23
SECTION 4.2. Responsibilities of the Sponsor.............. 24
ARTICLE V
TRUSTEES..................... 24
SECTION 5.1. Number of Trustees........................... 24
SECTION 5.2. Delaware Trustee............................. 25
SECTION 5.3. Property Trustee; Eligibility................ 25
SECTION 5.4. Qualifications of Regular Trustees and
Delaware Trustee Generally................. 26
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SECTION 5.5. Initial Trustees............................. 26
SECTION 5.6. Appointment, Removal and Resignation of
Trustees................................... 26
SECTION 5.7. Vacancies among Trustees..................... 28
SECTION 5.8. Effect of Vacancies.......................... 28
SECTION 5.9. Meetings..................................... 28
SECTION 5.10. Delegation of Power.......................... 29
ARTICLE VI
DISTRIBUTIONS................. 29
SECTION 6.1. Distributions................................ 29
ARTICLE VII
ISSUANCE OF SECURITIES............. 29
SECTION 7.1. General Provisions Regarding Securities...... 29
ARTICLE VIII
TERMINATION OF TRUST.............. 30
SECTION 8.1. Termination of Trust......................... 30
ARTICLE IX
TRANSFER OF INTERESTS............. 31
SECTION 9.1. Transfer of Securities....................... 31
SECTION 9.2. Transfer of Certificates..................... 32
SECTION 9.3. Deemed Security Holders...................... 32
SECTION 9.4. Book Entry Interests......................... 32
SECTION 9.5. Notices to Clearing Agency................... 33
SECTION 9.6. Appointment of Successor Clearing
Agency..................................... 33
SECTION 9.7. Definitive Preferred Security
Certificates............................... 33
SECTION 9.8. Mutilated, Destroyed, Lost or Stolen
Certificates............................... 34
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS... 35
SECTION 10.1. Liability................................... 35
SECTION 10.2. Exculpation................................. 35
SECTION 10.3. Fiduciary Duty.............................. 35
SECTION 10.4. Indemnification............................. 36
SECTION 10.5. Outside Businesses.......................... 37
ARTICLE XI
ACCOUNTING................... 38
SECTION 11.1. Fiscal Year................................. 38
SECTION 11.2. Certain Accounting Matters.................. 38
SECTION 11.3. Banking..................................... 38
SECTION 11.4. Withholding................................. 39
ARTICLE XII
AMENDMENTS AND MEETINGS............. 39
SECTION 12.1. Amendments.................................. 39
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SECTION 12.2. Meetings of the Holders of Securities;
Action by Written Consent................. 41
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE....... 43
SECTION 13.1. Representations and Warranties of Property
Trustee................................... 43
ARTICLE XIV
MISCELLANEOUS.................. 44
SECTION 14.1. Notices..................................... 44
SECTION 14.2. Governing Law............................... 45
SECTION 14.3. Intention of the Parties.................... 45
SECTION 14.4. Headings.................................... 45
SECTION 14.5. Successors and Assigns...................... 45
SECTION 14.6. Partial Enforceability...................... 45
SECTION 14.7. Counterparts................................ 45
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CROSS-REFERENCE TABLE*
Section of
Trust Indenture Act Section of
of 1939, as amended Declaration
- -------------------- -----------
310(a) 5.3(a4)
310(b) 5.3(c)
310(c) Inapplicable
311(c) Inapplicable
312(a) 2.2(a)
312(b) 2.2(b)
313 2.3
314(a) 2.4
314(b) Inapplicable
314(c) 2.5
314(d) Inapplicable
314(f) Inapplicable
315(a) 3.9(b)
315(b) 2.8
315(c) 3.9(a)
315(d) 3.9(a)
316(a) Exhibit A, 2.6
316(c) 3.6(e)
*This Cross-Reference Table does not constitute part of the Declaration and
shall not affect the interpretation of any of its terms or provisions.
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AMENDED AND RESTATED DECLARATION OF TRUST
OF
COMED FINANCING I
THIS AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration"), dated and
effective as of ____________, 1995, by the Trustees (as defined herein), the
Sponsor (as defined herein), and by the holders, from time to time, of undivided
beneficial interests in the Trust to be issued pursuant to this Declaration;
W I T N E S S E T H:
WHEREAS, the Trustees and the Sponsor desire to establish a trust (the
"Trust") under the Business Trust Act (as defined herein) 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;
NOW, THEREFORE, it being the intention of the parties hereto to form 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 contributed to the Trust will be held in trust for the benefit
of the holders, from time to time, of the securities representing undivided
beneficial interests in the assets of the Trust issued hereunder, subject to the
provisions of this Declaration.
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1. Definitions. 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. A term defined anywhere in this Declaration has the same
meaning throughout. 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.
"Affiliate" has the same meaning as given to that term in Rule 405 of
the Securities Act or any successor rule thereunder.
"Authorized Officer" of a Person means any Person that is authorized
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.
<PAGE>
"Business Day" means any day other than a day on which banking
institutions in Wilmington, Delaware or 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. C. (S)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
depository 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 Securities.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom, from time to time, the
Clearing Agency effects book entry transfers and pledges of securities
deposited with the Clearing Agency.
"Closing Date" means ____________, 1995.
"Code" means the Internal Revenue Code of 1986.
"ComEd" means Commonwealth Edison Company, an Illinois corporation,
or any successor entity in a merger.
"Common Security" has the meaning specified in Section 7.1.
"Common Security Certificate" means a definitive certificate in fully
registered form representing a Common Security substantially in the form of
Annex II to Exhibit A.
"Common Security Guarantee" means the Common Securities Guarantee
Agreement to be dated as of ____________, 1995 of the Sponsor in respect of
the Common Securities in the form of Exhibit B.
"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
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(b) any Holder of Securities.
"Debenture Issuer" means ComEd, in its capacity as the issuer of the
Debentures.
"Debenture Trustee" means Wilmington Trust Company, not in its
individual capacity but solely 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 the Property Trustee, a specimen
certificate for such series of Debentures being set forth in Exhibit D.
"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 Securities
in accordance with Section 6.1.
"DTC" means The Depository Trust Company, the initial Clearing Agency.
"Event of Default" in respect of the Securities means an Indenture
Default has occurred and is continuing in respect of the Debentures.
"Exchange Act" means the Securities Exchange Act of 1934.
"Global Certificate" has the meaning set forth in Section 9.4.
"Holder" means the 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 any Trustee, any Affiliate of any Trustee,
or any officers, directors, shareholders, members, partners, employees,
representatives or agents of any Trustee, or any employee or agent of the
Trust or its Affiliates.
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"Indenture" means the Indenture dated as of ____________, 1995
between the Debenture Issuer and the Debenture Trustee, and any indenture
supplemental thereto pursuant to which the Debentures are to be issued.
"Indenture Default" means an "Event of Default" as such term is
defined in the Indenture.
"Investment Company" means an investment company as defined in the
Investment Company Act.
"Investment Company Act" means the Investment Company Act of 1940.
"Legal Action" has the meaning set forth in Section 3.6(g).
"Majority in liquidation amount of the Securities" means, except as
provided in the terms of the Preferred Securities or the Trust Indenture
Act, Holder(s) of outstanding Securities voting together as a single class
or, as the context may require, Holder(s) of outstanding Preferred
Securities or outstanding Common Securities voting separately as a class,
representing more than 50% of the aggregate stated liquidation amount
(including the stated amount that would be paid on redemption, liquidation
or maturity, plus accrued and unpaid Distributions to the date upon which
the voting percentages are determined) of all outstanding Securities of
such class.
"Ministerial Action" has the meaning set forth in the terms of the
Securities as set forth in Exhibit A.
"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 Declaration shall include:
(a) a statement that each officer signing the Certificate has
read the covenant or condition and the definition(s) relating thereto;
(b) a brief statement of the nature and scope of the examination
or investigation undertaken by each officer in rendering the
Certificate;
(c) a statement that each such officer has made such examination
or investigation as, in such officer's opinion, 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
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(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(i).
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company,
limited liability company, trust, unincorporated association, or government
or any agency or political subdivision thereof, or any other entity of
whatever nature.
"Preferred Securities Guarantee" means the Preferred Securities
Guarantee Agreement to be dated as of ______________, 1995 of the Sponsor
in respect of the Preferred Securities in the form of Exhibit C.
"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 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)(i).
"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
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any other Person which owns, directly or indirectly, 100% of the
outstanding voting securities of the Sponsor.
"Responsible Officer" means, with respect to the Property Trustee, the
chairman of the board of directors, the president, 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 Property Trustee customarily performing
functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of that
officer's knowledge of and familiarity with the particular subject.
"Rule 3a-7" means Rule 3a-7 under the Investment Company Act.
"Securities" mean the Common Securities and the Preferred Securities.
"Securities Act" means the Securities Act of 1933.
"Securities Guarantee" means each of the Common Securities Guarantee
and the Preferred Securities Guarantee.
"66-2/3% in liquidation amount of the Securities" means, except as
provided in the terms of the Preferred Securities or the Trust Indenture
Act, Holder(s) of outstanding Securities voting together as a single class
or, as the context may require, Holder(s) of outstanding Preferred
Securities or outstanding Common Securities, voting separately as a class,
representing 66-2/3% of the aggregate stated liquidation amount (including
the stated amount that would be paid on redemption, liquidation or
maturity, plus accrued and unpaid Distributions to the date upon which the
voting percentages are determined) of all outstanding Securities of such
class.
"Special Event" has the meaning set forth in the terms of the
Securities.
"Sponsor" means ComEd, in its capacity as sponsor of the Trust.
"Successor Property Trustee" means a successor Trustee possessing the
qualifications to act as Property Trustee under Section 5.3(a).
"10% in liquidation amount of the Securities" means, except as
provided in the terms of the Preferred Securities or the Trust Indenture
Act, Holder(s) of outstanding Securities voting together as a single class
or, as the context may
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require, Holder(s) of outstanding Preferred Securities or outstanding
Common Securities, voting separately as a class, representing 10% of the
aggregate stated liquidation amount (including the stated amount that would
be paid on redemption, liquidation or maturity, plus accrued and unpaid
Distributions to the date upon which the voting percentages are determined)
of all outstanding Securities of such class.
"Treasury Regulations" means the income tax regulations including
temporary and proposed regulations, promulgated under the Code by the
United States Treasury, as amended.
"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.
"Underwriting Agreement" means the Underwriting Agreement for the
offering and sale of Preferred Securities in the form of Exhibit E.
1.2. Interpretation. Each definition in this Declaration includes
the singular and the plural, and references to the neuter gender include the
masculine and feminine where appropriate. Terms which relate to accounting
matters shall be interpreted in accordance with generally accepted accounting
principles in effect from time to time. References to any statute mean such
statute as amended at the time and include any successor legislation. The word
"or" is not exclusive, and the words "herein," "hereof" and "hereunder" refer to
this Declaration as a whole. The headings to the Articles and Sections are for
convenience of reference and shall not affect the meaning or interpretation of
this Declaration. References to Articles, Sections, Annexes and Schedules mean
the Articles, Sections, Annexes and Schedules of this Declaration. The Annexes,
if any, and Schedules are hereby incorporated by reference into and shall be
deemed a part of this Declaration.
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.
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(b) The Property Trustee shall be the only Trustee which is a trustee
for the purposes of the Trust Indenture Act. If and to the extent that any
provision of this Declaration limits, qualifies or conflicts with the duties
imposed by sections 310 to 317, inclusive, of the Trust Indenture Act, such
imposed duties shall control.
(c) The application of the Trust Indenture Act to this Declaration
shall not affect the nature of the Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.
SECTION 2.2. Lists of Holders of Securities. (a) Each of the Sponsor
and the Regular Trustee(s) on behalf of the Trust shall provide the Property
Trustee (i) within fourteen (14) days after each record date for payment of
Distributions a list, in such form as the Property Trustee may reasonably
require, of the names and addresses of the Holders 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 obligated to provide such List
of Holders at any time the List of Holders does not differ from the most recent
List of Holders given to the Property Trustee by the Sponsor and the Regular
Trustees on behalf of the Trust, and (ii) at any other time, within thirty (30)
days of receipt by the Trust of a written request for a List of Holders as of a
date no more than fourteen (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 its capacity as Paying Agent (if acting in such
capacity) provided that the Property Trustee may destroy any List of Holders
previously given to it on receipt of a new List of Holders.
(b) The Property Trustee shall comply with its obligations under
sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3. Reports by the Property Trustee. Within 60 days after
May 15 of each year, the Property Trustee shall provide to the Holders of the
Preferred Securities and file with Persons such reports, if any, as are required
by Section 313 of the Trust Indenture Act, in the form and in the manner and to
the Person or Persons provided by section 313 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 as 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
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of the Trust shall provide to the Property Trustee such evidence of compliance
with the conditions precedent, if any, provided for in this Declaration which
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 Event of Default:
(i) is not waivable under the Indenture, the Event of Default under
this Declaration shall also not be waivable; or
(ii) which requires the consent or vote of greater than a majority in
principal amount of the holders of the Debentures (a "Super-Majority") to
be waived under the Indenture, the Event of Default under this Declaration
may only be waived by the vote of the Holders of at least the proportion in
liquidation amount of the Preferred Securities that the relevant Super
Majority represents to 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 Event of Default 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 in respect of the Common Securities
and its consequences, provided that if the Event of Default:
(i) is not waivable under the Indenture, except where the Holders of
the Common Securities are deemed to have waived such Event of Default under
this Declaration as provided below, the Event of Default under this
Declaration is not waivable; or
(ii) which requires the consent or vote of all of the holders of the
Debentures to be waived, the Event of Default
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under this Declaration may only be waived by the vote of all of the Holders
of the Preferred Securities, provided that each Holder of Common Securities
will be deemed to have waived any such Event of Default and all Events of
Default with respect to the Common Securities and its consequences 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 proviso, 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), is hereby defined as 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 the principal of
(or the premium, if any) or the 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
determine 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 knowledge of any
default except:
(i) a default arising under Sections 6.01(a)(1) and 6.01(a)(2) of the
Indenture; or
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(ii) any default as to which the Property Trustee shall have received
written notice or of which a Responsible Officer charged with the
administration of this Declaration shall have obtained written notice.
ARTICLE III
ORGANIZATION
SECTION 3.1. Name. The Trust is named "ComEd 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 activities 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 10 South Dearborn Street, 37th floor, Chicago, Illinois 60603. 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 a Trustee or the Trustees
acting on behalf of the Trust, no Person shall be required to inquire into the
authority of such Trustee or Trustees to bind the Trust. Persons dealing with
the Trust are entitled to rely conclusively on the power and authority of a
Trustee or the Trustees as set forth in this Declaration.
SECTION 3.5. Title to Property of the Trust. Except as provided in
Section 3.8 with respect to the Debentures and the Property Trustee Account or
as otherwise provided in this Declaration, legal title to all assets of the
Trust shall be vested in the Trust. The Holders shall not have legal title of
any part
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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 and authority and duty to cause the
Trust to engage in the following activities:
(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, there shall be
no interests in the Trust other than the Securities and the issuance of
Securities 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 Securities and Exchange Commission
(the "Commission") the registration statement on Form S-3 prepared by
the Sponsor in relation to the Preferred Securities, including any
amendments thereto prepared by the Sponsor;
(ii) execute and file any documents prepared by the Sponsor, or
take any acts as determined by the Sponsor as necessary in order to
qualify or register all or part of the Preferred Securities 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, Inc. or any other national stock exchange
or the Nasdaq Stock Market's National Market for listing upon notice
of issuance of any Preferred Securities;
(iv) execute and file with the Commission a registration
statement on Form 8-A prepared by the Sponsor relating to the
registration of the class of Preferred Securities under Section 12(b)
of the Exchange Act, including any amendments thereto prepared by the
Sponsor; and
(v) execute and enter into the Underwriting Agreement and the
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
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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 of the Common Securities;
(d) to give the Sponsor and the Property Trustee prompt written
notice of the occurrence of a Special Event, provided that the Regular
Trustees shall consult with the Sponsor and the Property Trustee before
taking any Ministerial Action in relation to a Special Event;
(e) to establish a record date with respect to all actions to be
taken hereunder that require a record date to be established, including for
the purposes of section 316(c) of the Trust Indenture Act and with respect
to Distributions, voting rights, redemptions and exchanges, and to issue
relevant notices to the Holders of Preferred Securities and the Holders of
Common Securities as to such actions and applicable record dates;
(f) to take all actions and perform such duties as may be required of
the Regular Trustees pursuant to the terms of the Securities;
(g) to bring or defend, pay, collect, compromise, arbitrate, resort
to legal action, or otherwise adjust claims or demands of or against the
Trust ("Legal Action"), unless pursuant to Section 3.8(f), the Property
Trustee has the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors and
consultants and pay reasonable compensation for such services;
(i) to cause the Trust to comply with the Trust's obligations under
the Trust Indenture Act;
(j) to give the certificate to the Property Trustee required by
section 314(a)(4) of the Trust Indenture Act, which certificate may be
executed by any Regular Trustee;
(k) to incur expenses which 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, 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 interest on the Debentures by extending the interest payment
period under the Indenture or (ii) to extend the scheduled maturity date on
the Debentures;
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(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 which may be necessary or appropriate for the
preservation and the continuation of the Trust's valid existence, rights,
franchises and privileges as a statutory business trust under the laws of
the State of Delaware and of each other jurisdiction in which such
existence is necessary to protect the limited liability of the Holders of
the Securities or to enable the Trust to effect the purposes for which the
Trust was created;
(p) to take any action, not inconsistent with this Declaration or
with applicable law, which the Regular Trustees determine in their
discretion to be necessary or desirable in carrying out the activities of
the Trust as set out in this Section 3.6 including, but not limited to:
(i) causing the Trust not to be deemed to be an Investment
Company required to be registered under the Investment Company Act;
(ii) causing the Trust not to be characterized for United States
federal income tax purposes as a grantor trust and causing each Holder
of Securities to be treated as owning an undivided beneficial interest
in the Debentures; and
(iii) co-operating with the Debenture Issuer to ensure that the
Debentures will be treated as indebtedness of the Debenture Issuer for
United States federal income tax purposes,
provided that such action does not adversely affect the interests of the
Holders; and
(q) to take all action necessary to cause all applicable tax returns
and tax information reports that are required to be filed with respect to
the Trust to be duly prepared and filed by the Regular Trustees, on behalf
of the Trust.
The Regular Trustees must exercise the powers set forth in this Section 3.6 in a
manner which 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 which 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.
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SECTION 3.7. Prohibition of Actions by the Trust and the Trustees.
The Trust shall not, and the Trustees (including the Property Trustee) shall
not, and shall cause the Trust not to, engage in any activity other than as
required or authorized by this Declaration. In particular, the Trust shall not,
and the Trustees (including the Property Trustee) shall not and 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 Securities;
(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) consent to the modification of the Debentures or any other asset
of the Trust, 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 characterized 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 as set forth in Section 5.6. Such vesting and
cessation of title shall be effective whether or not conveyancing documents with
respect 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).
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(c) The Property Trustee shall:
(i) establish and maintain a segregated non-interest bearing bank
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 the 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 which
is maintained with a banking institution the rating on whose long-term
unsecured indebtedness is at least equal to the rating assigned to the
Preferred Securities by a "nationally recognized statistical rating
organization", as that term is defined for purposes of Rule 436(g)(2) under
the Securities Act;
(ii) engage in such ministerial activities as shall be necessary or
appropriate to effect the redemption of the Preferred Securities and the
Common Securities to the extent the Debentures are redeemed or mature; and
(iii) upon notice of distribution issued by the Regular Trustees in
accordance with the terms of the Preferred Securities and the Common
Securities, engage in such ministerial activities as shall be necessary or
appropriate to effect the distribution of the Debentures to Holders of
Securities upon the occurrence of certain 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 Securities.
(e) The Property Trustee shall hold the Preferred Securities
Guarantee and the Common Securities Guarantee for the benefit of the Holders of
the Preferred Securities and the Common Securities, respectively.
(f) 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 (including the Securities Guarantees) or
the Trust Indenture Act.
(g) The Property Trustee shall not resign as a Trustee unless either:
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(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 accepted
that appointment in accordance with Section 5.6.
(h) 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 the Holders of the Securities, enforce its
rights under the Indenture with respect to the Debentures and its rights under
the Securities Guarantees in accordance with the terms of the Securities
Guarantees, subject to the rights of the Holders pursuant to the terms of such
Securities and Securities Guarantees.
(i) The Property Trustee may authorize one or more Persons (each, a
"Paying Agent") to pay Distributions, redemption payments or liquidation
payments on behalf of the Trust with respect to the Preferred Securities and the
Common 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.
(j) Subject to this Section 3.8, the Property Trustee shall have none
of the 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 which is consistent with the purposes and functions of
the Trust set forth in Section 3.3 and the Property Trustee shall not take any
action which 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 in the terms of the Securities, and no implied covenants
shall be read into this Declaration against the Property Trustee. In case an
Event of Default has occurred (that has not been cured or waived pursuant to
Section 2.6), 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 exercise, as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.
(b) No provision of this Declaration shall be construed to relieve
the Property Trustee from liability for its own
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negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) prior to the occurrence of any Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Property Trustee shall be
determined solely by the express provisions of this Declaration and in
the terms of the Securities, and the Property Trustee shall not be
liable except for the performance of such duties and obligations as
are specifically set forth in this Declaration, and 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 certificates or opinions furnished to the Property
Trustee and conforming to the requirements 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 pertinent 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 financial
liability in the performance of any of its duties or in the exercise of any
of its rights or powers, if there is reasonable ground for believing that
the repayment of such funds or liability is not reasonably assured to it
under the terms of this Declaration or adequate indemnity against such risk
is not reasonably assured to it;
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(v) the Property Trustee's sole duty with respect to the custody,
safe keeping and physical preservation of the Debentures and the Property
Trustee Account shall be to deal with such property in a similar manner as
the Property Trustee deals with similar property for its own account,
subject to the protections and limitations on liability afforded to the
Property Trustee under this Declaration, the Trust Indenture Act;
(vi) the Property Trustee shall have no duty or liability for or with
respect to the value, genuineness, existence or sufficiency of the
Debentures or the payment of any taxes or assessments levied thereon or in
connection therewith;
(vii) the Property Trustee shall not be liable for any interest on
any money received by it except as it may otherwise agree with the Sponsor.
Money held by the Property Trustee need not be segregated from other funds
held by it except in relation to the Property Trustee Account maintained by
the Property Trustee pursuant to Section 3.8(c)(i) and except to the extent
otherwise required by law; and
(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 Sponsor.
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 Regular Trustees
contemplated by this Declaration shall be sufficiently evidenced by a
Direction or an Officers' Certificate;
(iii) whenever in the administration of this Declaration the Property
Trustee shall deem it desirable that a matter be proved or established
before taking, suffering or omitting any action hereunder, the Property
Trustee (unless other evidence is herein specifically prescribed) may, in
the absence of bad faith on its part and, if the Trust is excluded from the
definition of Investment Company solely by means of Rule 3a-7, subject to
the requirements of Rule 3a-7, request and rely upon an Officers'
Certificate which, upon
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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, but not limited to, any
financing or continuation statement or any filing under tax or securities
laws (or any rerecording, refiling or registration thereof);
(v) the Property Trustee may consult with counsel or experts and the
written advice or opinion of such counsel or other expert with respect to
legal matters or advice within the scope of such expert's area of expertise
shall be full and complete authorization and protection in respect of any
action taken, suffered or omitted by it hereunder in good faith and in
accordance with such advice or opinion; and the Property Trustee shall have
the right at any time to seek instructions concerning the administration of
this Declaration from any court of competent jurisdiction;
(vi) the Property Trustee shall be under no obligation to exercise
any rights or powers vested in it under this Declaration at the request or
discretion 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 compliance with such request or direction,
including such reasonable advances as may be requested by the Property
Trustee, provided that nothing contained in this Section 3.10(a)(vi) shall
be taken to relieve the Property Trustee, upon the occurrence of an Event
of Default, from exercising the rights and powers vested in it by this
Declaration;
(vii) the Property Trustee shall not be bound to make any
investigatio into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Property Trustee, in its
discretion, may make such further inquiry or investigation into such facts
or matters as it may see fit;
(viii) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents 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
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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 required to inquire as to the authority of the Property
Trustee to so act, or as to its compliance with any of the terms and
provisions of this Declaration, both of which shall be conclusively
evidenced by the Property Trustee's or its agent's taking such action;
(x) whenever in the administration of this Declaration the Property
Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder, the
Property Trustee (i) may request instructions from the Holders of the
Securities representing the aggregate liquidation amount of all outstanding
Securities of such class required under the terms of the Securities to
direct the Property Trustee to enforce such remedy or right or take such
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 and 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, 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
which the Regular Trustees have the power and authority to execute pursuant to
Section 3.6, provided that any listing application prepared by the Sponsor
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referred to in Section 3.6(b)(iii) may be executed by any Regular Trustee.
SECTION 3.13. Not Responsible for Recitals or Issuance of Securities.
The recitals contained in this Declaration and the Securities shall be taken as
the statements of the Sponsor and the Trustees do not assume any responsibility
for their correctness. The Trustees make no representations as to the value or
condition of the property of the Trust or any part thereof. The Trustees make
no representations as to the validity or sufficiency of this Declaration or the
Securities.
SECTION 3.14. Duration of Trust. The Trust, unless terminated
pursuant to the provisions of Article VIII hereof, shall have existence for
forty-five (45) 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 the Regular Trustees or, if
there are more than two, a majority of the Regular Trustees and without the
consent of the Holders of the Securities, consolidate, amalgamate, merge with or
into, or be replaced by a trust organized as such under the laws of any State;
provided that:
(i) such successor entity (the "Successor Entity") either:
(A) expressly assumes all of the obligations of the Trust under
the Trust Securities; or
(B) substitutes for the Preferred Securities other securities
having substantially the same terms as the Preferred Securities and
Common Securities, respectively (the "Successor Securities") so long
as the Successor Securities rank the same as the Preferred Securities
and Common Securities rank with respect to Distributions and payments
upon liquidation, redemption, maturity and otherwise;
(ii) the Debenture Issuer expressly acknowledges a trustee of the
Successor Entity which possesses the same powers and duties as the Property
Trustee as the Holder of the Debentures;
(iii) the Preferred Securities or any Successor Securities are
listed, or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or other organization on
which the Preferred Securities are then listed;
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(iv) such merger, consolidation, amalgamation or replacement does not
cause the Preferred Securities (including any Successor Securities) to be
downgraded by any nationally recognized statistical rating organization;
(v) such 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);
(vi) such successor entity has a purpose identical to that of the
Trust;
(vii) prior to such merger, consolidation, amalgamation or
replacement, the Sponsor has received an opinion from independent 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 not consolidate,
amalgamate, merge with or into, or be replaced by any other entity or permit any
other entity to consolidate, amalgamate, merge with or into, or replace it if
such consolidation, amalgamation, merger or replacement would cause the Trust or
Successor Entity for United States federal income tax purposes to be classified
as other than a grantor trust and each Holder of the Securities not to be
treated as owning an undivided beneficial interest in the Debentures, except
with the consent of Holders of 100% in liquidation amount of the Securities.
ARTICLE IV
SPONSOR
SECTION 4.1. Sponsor's Purchase of Common Securities. On the Closing
Date, the Sponsor will purchase all of the Common
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Securities issued by the Trust, in an amount equal to 3% of the capital of the
Trust at the same time as the Preferred Securities are sold.
SECTION 4.2. Responsibilities of the Sponsor. In connection with the
issue and sale of the Preferred Securities, the Sponsor shall have the exclusive
right and responsibility 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
take 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, Inc. or any other national stock exchange or the Nasdaq
Stock Market's 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
class of 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 the
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 decrease the number of Trustees;
and
(b) after the issuance of any Securities, the number of Trustees may
be increased or decreased by vote of the Holders of a Majority in
liquidation amount of the Common Securities voting as a class at a meeting
of the Holders of the Common Securities;
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provided that in any case, the number of Trustees shall be at least five (5)
unless the Trustee that acts as the Property Trustee also acts as the Delaware
Trustee pursuant to Section 5.2, in which case the number of Trustees shall be
at least three (3).
SECTION 5.2. Delaware Trustee. If required by the Business Trust
Act, one Trustee (the "Delaware Trustee") shall be:
(a) a natural person who is a resident of the State of Delaware; or
(b) if not a natural person, an entity which has its principal place
of business in the State of Delaware and otherwise meets the requirements
of applicable law,
provided that if the Property Trustee has its principal place of business in the
State of Delaware and otherwise meets the requirements of applicable law, then
the Property Trustee shall also be the Delaware Trustee and Section 3.11 shall
have no application.
SECTION 5.3. Property Trustee; Eligibility. (a) There shall at all
times be one Trustee which shall act as Property Trustee and 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 fifty million U.S. dollars
($50,000,000), and subject to supervision or examination by federal, state,
territorial or District of Columbia authority (if such corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority referred to above,
then for the purposes of this Section 5.3(a)(ii), the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published);
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
qualifications.
(b) If at any time the Property Trustee shall cease to be eligible to
so act under Section 5.3(a), the Property Trustee
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shall immediately resign in the manner and with the effect set out in Section
5.6(c).
(c) If the Property Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Property Trustee and the Holders of the Common Securities (as if they 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.
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 twenty-one (21) years of age or a legal entity which shall act through
one or more Authorized Officers.
SECTION 5.5. Initial Trustees. The initial Regular Trustees shall
be:
John C. Bukovski
10 South Dearborn Street--37th Floor
Chicago, Illinois 60603
Dennis F. O'Brien
10 South Dearborn Street--37th Floor
Chicago, Illinois 60603
The initial Property Trustee shall be:
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890
which shall also act as the initial Delaware 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, 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.
(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
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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 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.
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 until:
(A) a Successor Property Trustee has been appointed and has
accepted such appointment by instrument executed by such Successor
Property Trustee and delivered to the Trust and the Sponsor; or
(B) if the Trust is deemed not to be an Investment Company
solely by reason of Rule 3a-7, until the assets of the Trust have been
completely liquidated and the proceeds thereof distributed to the
holders of the Securities; and
(ii) no such resignation of the Trustee that acts as the Delaware
Trustee shall be effective until a Successor Delaware Trustee has been
appointed and has accepted such appointment by instrument executed by such
Successor Delaware Trustee and delivered to the Trust and the Sponsor.
(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 appointment 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 petition any court of competent jurisdiction for appointment of
a
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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, dissolution, liquidation, incompetence or
incapacity to perform the duties of a Trustee, or any one of them, 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 resolution 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 purposes 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. In the event there is only one Regular
Trustee, any action of such Regular Trustee shall be evidenced by a written
consent of such Regular Trustee.
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SECTION 5.10. Delegation of Power. (a) Any Regular Trustee may, by
power of attorney consistent with applicable law, delegate to any other natural
person over the age of 21 his or her power for the purpose of executing any
documents contemplated in Section 3.6, including any registration statement or
amendment thereto filed with the Commission or making any other governmental
filing.
(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
contrary to the provisions of the Trust, as set forth herein.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1. Distributions. Holders shall receive Distributions in
accordance with the applicable terms of the relevant Holder's Securities.
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 Compounded 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 of the Payment
Amount to the 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 and incorporated herein by
reference (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 and incorporated herein by reference
(the "Common Securities"). The Trust shall have no securities or other
interests in the assets of the Trust other than the Preferred Securities and the
Common Securities.
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(b) The Securities 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
signatures 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 Security. 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 Security so signed shall be delivered by the Trust,
such Security nevertheless may be delivered as though the person who signed such
Security had not ceased to be such Regular Trustee; and any Security may be
signed on behalf of the Trust by such persons as, at the actual date of the
execution of such Security, the Regular Trustees of the Trust, although at the
date of the execution and delivery of the Declaration any such person was not
such a Regular Trustee.
(c) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and shall
not constitute a loan to the Trust.
(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, subject to Section 10.1(b) with respect to the Common
Securities.
(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 ninety (90) days after the date of revocation without
a reinstatement thereof;
(iii) upon the entry of a decree of judicial dissolution of the Holder
of the Common Securities, the Sponsor or the Trust;
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(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 Special Event pursuant
to which the Trust shall have been dissolved in accordance with the terms
of the Securities and all of the Debentures 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 Article X shall survive the termination of the
Trust.
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1. Transfer of Securities. (a) Securities may only be
transferred, in whole or in part, in accordance with the terms and conditions
set forth in this Declaration and in the terms of the Securities. Any 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 Sponsor 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 each Holder of Securities would
not be treated as owning an undivided beneficial interest in the
Debentures; and
(ii) the Trust would be an Investment Company or the transferee would
be an Investment Company if the transferee was not an Investment Company
before the transfer.
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SECTION 9.2. Transfer of Certificates. The Regular Trustees shall
provide for the registration of Certificates and of transfers of Certificates,
which will be effected without charge but only upon payment (with such indemnity
as the Regular Trustees may require) in respect of any tax or other government
charges which may be imposed in relation to it. Upon surrender for registration
of transfer of any Certificate, the Regular Trustees shall cause one or more new
Certificates 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
Certificate shall be entitled to the rights and subject to the obligations of a
Holder hereunder upon the receipt by such transferee of a Certificate. By
acceptance of a Certificate, each transferee shall be deemed to have agreed to
be bound by this Declaration 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 Certificate on the part of
any Person, whether or not the Trustees shall have actual or other notice
thereof.
SECTION 9.4. Book Entry Interests. Unless otherwise specified in the
terms of the Preferred Securities, the Preferred Securities Certificates, on
original issuance, will be issued in the form of one or more, fully registered,
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 Certificates, 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
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(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 Certificates 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 agreements between such Preferred Security
Beneficial Owners and the Clearing Agency and/or the Clearing Agency
Participants. DTC will make book entry transfers among the Clearing Agency
Participants and receive and transmit payments of Distributions on the
Global Certificates to such 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
Securities.
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 ninety (9O) 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 Securities,
then:
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(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 Clearing Agency,
accompanied by registration instructions, the Regular Trustees shall cause
Definitive Preferred Security Certificates 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 instructions and each of them may
conclusively rely on, and shall be protected in relying on, such
instructions. 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 destruction, 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 Certificate, 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.
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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 Debentures, 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.
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, pursuant to Section 3.9,
negligence) or willful misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Trust and upon such information, opinions, reports
or statements presented to the Trust by any Person as to matters the Indemnified
Person reasonably believes are within such other Person's professional or expert
competence and who has been selected with reasonable care by or on behalf of the
Trust, including information, opinions, reports or statements as to the value
and amount of the assets, liabilities, profits, losses, or any other facts
pertinent to the existence and amount of assets from which Distributions to
Holders of Securities might properly be paid.
SECTION 10.3. Fiduciary Duty. (a) To the extent that, at law or in
equity, an Indemnified Person has duties (including fiduciary duties) and
liabilities relating thereto to the Trust or to any other Covered Person, an
Indemnified Person acting under this Declaration, subject to any duties or
obligations imposed on
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the Property Trustee under Rule 3a-7, shall not be liable to the Trust or to any
other Covered Person for its good faith reliance on the provisions of this
Declaration. The provisions of this Declaration, to the extent that they
restrict the duties and liabilities of an Indemnified Person otherwise existing
at law or in equity (other than 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 Covered Persons; or
(ii) whenever this Declaration or any other agreement contemplated
herein or therein provides that an Indemnified Person shall act in a manner
that is, or provides terms that are, fair and reasonable to the Trust or
any Holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is permitted
or required to make a decision:
(i) in its "discretion" or under a grant of similar authority, the
Indemnified Person shall be entitled to consider such interests and factors
as it desires, including its own interests, and shall have no duty or
obligation to give any consideration to any interest of, or factors
affecting, the Trust or any other Person; or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and shall not be
subject to any other or different standard imposed by this Declaration or
by applicable law.
SECTION 10.4. Indemnification. (a) To the fullest extent permitted
by applicable law, the Sponsor shall indemnify and hold harmless each
Indemnified Person from and against any loss, damage, liability, tax, penalty,
expense or claim incurred by such
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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 Declaration, 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, pursuant to Section 3.9, 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 Indemnified Person in defending any claim,
demand, action, suit or proceeding shall, from time to time, be advanced 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 rights to indemnification set forth herein shall survive the
termination of this Declaration.
SECTION 10.5. Outside Businesses. Any Covered Person, the Sponsor,
the Delaware Trustee and the Property Trustee may engage in or possess an
interest in other business ventures of any nature or description, independently
or with others, similar or dissimilar to the business of the Trust, and the
Trust and the Holders 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 competitive with the
business of the Trust, shall not be deemed wrongful or improper. No Covered
Person, the Sponsor, the Delaware Trustee or the Property Trustee shall be
obligated to present any particular investment or other opportunity to the Trust
even if such opportunity is of a character that, if presented to the Trust,
could be taken by the Trust, and any Covered Person, the Sponsor, the Delaware
Trustee and the Property Trustee shall have the right to take for its own
account (individually or as a partner or fiduciary) or to recommend to others
any such particular investment or other opportunity. Any Covered Person, the
Delaware Trustee and the Property Trustee may engage or be interested in any
financial or other transaction with the Sponsor or any Affiliate of the Sponsor,
or may act as depository 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.
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ARTICLE XI
ACCOUNTING
SECTION 11.1. Fiscal Year. The fiscal year ("Fiscal Year") of the
Trust shall be the calendar year, or such other year as is required by the Code.
SECTION 11.2. Certain Accounting Matters. (a) At all times during
the existence of the Trust, the Regular Trustees shall keep, or cause to be
kept, full books of account, records and supporting documents, which shall
reflect in reasonable detail, each transaction of the Trust. The books of
account shall be maintained on the accrual method of accounting, in accordance
with generally accepted accounting principles, consistently applied. The Trust
shall use the accrual method of accounting for United States federal income tax
purposes. The books of account and the records of the Trust shall be examined
by and reported upon as of the end of each Fiscal Year of the Trust by a firm of
independent certified public accountants selected by the Regular Trustees.
(b) The Regular Trustees shall cause to be prepared and delivered 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, an annual United States federal
income tax information statement, if one is required by the Code, containing
such information with regard to the Securities held by each Holder as is
required by the Code and the Treasury Regulations. Notwithstanding any right
under the Code to deliver any such statement at a later date, the Regular
Trustees shall endeavor to deliver all such statements within thirty (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 sole
signatories for such accounts shall be designated by the Regular
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Trustees; provided, however, that the Property Trustee shall designate the
signatories for the Property Trustee Account.
SECTION 11.4. Withholding. The Trust and the Trustees shall comply
with all withholding requirements under United States federal, state and local
law. The Trust shall request, and the Holders shall provide to the Trust, such
forms or certificates as are necessary to establish an exemption from
withholding with respect to each Holder, and any representations and forms as
shall reasonably be requested by the Trust to assist it in determining the
extent of, and in fulfilling, its withholding obligations. The Regular
Trustee(s) 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 with-holding, Holders shall be
limited to an action against the applicable jurisdiction. If the amount
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
be amended by, and only by, a written instrument approved and executed by the
Regular Trustees (or, if there are more than two Regular Trustees, a majority of
the Regular Trustees); provided, however, that:
(i) no amendment shall be made, and any such purported amendment
shall be void and ineffective:
(1) 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);
(2) unless, in the case of any proposed amendment with affects
the rights, powers, duties, obligations or immunities of the
Property Trustee, the Property Trustee shall have first
received:
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(A) an Officers' Certificate from each of the Trust and the
Sponsor that such amendment is permitted by, and conforms to, the
terms of this Declaration (including the terms of the Securities); and
(B) an opinion of counsel (who may be counsel to the Sponsor or
the Trust) that such amendment is permitted by, and conforms to, the
terms of this Declaration (including the terms of the Securities); and
(ii) no amendment shall be made, and any such purported amendment
shall be void and ineffective, to the extent the result thereof would be to
(A) cause the Trust not to be characterized for purposes of
United States federal income taxation as a grantor trust and each
Holder of Securities not to be treated as owning an undivided
beneficial interest in the Debentures, as evidenced by an Opinion of
Counsel to the effect that such amendment shall not result in the
foregoing;
(B) affect adversely the rights, powers, duties, obligations or
immunities of the Property Trustee or the Delaware Trustee; or
(C) cause the Trust to be deemed to be an Investment Company
which is required to be registered under the Investment Company Act;
(iii) at such time after the Trust has issued any Securities which
remain outstanding, any amendment which 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;
(iv) Section 9.1(c) and this Section 12.1 shall not be amended
without the consent of all of the Holders of the Securities;
(v) Article IV shall not be amended without the consent of the
Holders of a Majority in liquidation amount of the Common Securities; and
(vi) 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.
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(b) Notwithstanding Section 12.1(a)(ii), 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) to add to the covenants, restrictions or obligations of the
Sponsor; and
(iv) to 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 such class of Holders, 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 specified shall be counted for purposes of
determining whether the required percentage set forth in the second sentence of
this paragraph has been met.
(b) Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of Holders of
Securities:
(i) Notice of any such meeting shall be given to all the Holders of
Securities having a right to vote thereat at least seven (7) days and not
more than sixty (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 approval may be given at a meeting of the Holders of Securities.
Any action that may be taken at a
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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 without 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 eleven (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.
(iv) Unless the Business Trust Act, this Declaration, the Trust
Indenture Act, the terms of the Securities 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.
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ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
SECTION 13.1. Representations and Warranties of Property Trustee.
[*To be conformed to Underwriting Agreement*]
The Trustee which acts as initial Property Trustee represents and warrants to
the Trust and to the Sponsor at the date of this Declaration, and each Successor
Property Trustee represents and warrants to the Trust and the Sponsor at the
time of the Successor Property Trustee's acceptance of its appointment as
Property Trustee that:
(a) The Property Trustee is a Delaware banking association with trust
powers, duly organized, validly existing and in good standing under the
laws of the State of Delaware, 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
executed 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 bankruptcy,
reorganization, moratorium, insolvency and other similar laws affecting
creditors' rights generally and to general principles of equity and the
discretion of the court (regardless of whether the enforcement of such
remedies is considered in a proceeding in equity or at law).
(c) The execution, delivery and performance of the Declaration 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 registration with or
notice to, any State or Federal banking authority is required for the
execution, delivery or performance by the Property Trustee of the
Declaration.
(e) The Delaware Trustee has been authorized to perform its
obligations under the Certificate of Trust and the Declaration. The
Declaration under Delaware law constitutes a legal, valid and binding
obligation of the Delaware Trustee, enforceable against it in accordance
with its terms, subject to applicable bankruptcy, reorganization,
moratorium, insolvency and other similar laws affecting creditors' rights
generally and to general principles of equity and the
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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
delivered, 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):
COMED FINANCING I
c/o Commonwealth Edison Company
10 South Dearborn Street--37th Floor
Chicago, Illinois 60603
Attention: Treasurer
(b) if given to the Property Trustee, at the mailing address set
forth below (or such other address as the Property Trustee may give notice
of to the Holders of the Securities):
Wilmington Trust Company
Rodney Square North
1100 North 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 of to the Trust):
Commonwealth Edison Company
10 South Dearborn Street--37th Floor
Chicago, Illinois 60690-0767
Attention: Treasurer
(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
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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, the Trust be characterized as a grantor trust or otherwise in a
manner that each Holder of Securities 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 convenience 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.
IN WITNESS WHEREOF, the undersigned has caused these presents to be
executed as of the day and year first above written.
__________________________
John C. Bukovski, as Trustee
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_________________________
Dennis F. O'Brien, as Trustee
WILMINGTON TRUST COMPANY,
as Trustee
By: _________________________
Name:
Title:
COMMONWEALTH EDISON COMPANY
as Sponsor
By: ______________________
Name:
Title:
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EXHIBIT A
TERMS OF SECURITIES
EXHIBIT B
COMMON SECURITIES GUARANTEE
EXHIBIT C
PREFERRED SECURITIES GUARANTEE
EXHIBIT D
SPECIMEN OF DEBENTURE
EXHIBIT E
UNDERWRITING AGREEMENT
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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, privileges, 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 Preferred Securities" (the
"Preferred Securities"). The Preferred Security Certificates evidencing the
Preferred Securities shall be substantially in the form attached hereto as Annex
I, with such changes and additions thereto or deletions therefrom as may be
required by ordinary usage, custom or practice.
(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 Debentures to be held by the Property Trustee. Distributions in
arrears will bear interest compounded quarterly at the Coupon Rate (to the
extent permitted by applicable law). The term "Distributions," as used herein,
includes any such interest payable unless otherwise
<PAGE>
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, on the basis
of the actual number of days elapsed in such a 90-day quarter.
(b) Distributions on the Securities will be cumulative, will accrue
from ________, 1995 and will be payable quarterly in arrears, on March 31, June
30, September 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 twenty
consecutive quarters (each such period, an "Extension Period") and, as a
consequence of such extension, 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 twenty consecutive
quarters or extend beyond the maturity of the Debentures. Payments of accrued
Distributions will be payable to Holders as they appear on the books and records
of the Trust on the first record date after the end of the Extension Period.
Upon the termination of any Extension Period and the payment of all amounts then
due, the Debenture Issuer may commence a new Extension Period, subject to the
above requirements.
(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 Debentures. Subject to any applicable laws and regulations and the
provisions of the Declaration, each such payment 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 dated ________, 1995 (the "Prospectus") of the Trust
included in the Registration Statement on Form S-3 of the Sponsor and the Trust.
The relevant record dates for the Common Securities, and 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
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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 payable on the Securities
is not a Business Day, then payment of the Distribution payable on such date
will be made on the next succeeding day that is a Business Day (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 Securities.
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
termination, 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
Distribution"), 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
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maturity or upon acceleration, redemption or otherwise, the proceeds from such
repayment or payment shall be simultaneously applied to redeem Securities having
an aggregate stated liquidation amount equal to the aggregate principal amount
of the Debentures so repaid or redeemed 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 except
in the case of payments upon maturity.
(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
Section 4(f)(ii) below.
(c) If, at any time, a Tax Event or an Investment Company Event (each
as defined below, and each a "Special Event") 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 Special Event (the "90 Day Period"),
provided however, that in the case of the occurrence of a Tax Event, as a
condition of such dissolution and distribution, the Regular Trustees shall have
received an opinion from independent tax counsel experienced in such matters (a
"No Recognition Opinion"), which opinion may rely on published revenue rulings
of the Internal Revenue Service, 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 dissolution of the Trust and the distribution of
the 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 Special
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 Sponsor, the Trust, the Debenture Issuer or the Holders of the
Securities ("Ministerial Action"), the Trust will pursue such Ministerial Action
in lieu of dissolution.
If, in the case of the occurrence of a Tax Event (i) the Debenture
Issuer has received an opinion (a "Redemption Tax Opinion") from 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
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federal income tax purposes even if the Debentures were distributed to the
Holders of Securities in liquidation of such Holders' interests in the Trust as
described in this Section 4(c), or (ii) the Regular Trustees shall have been
informed by such tax counsel that a No Recognition Opinion cannot be delivered
to the Trust, the Debenture Issuer shall have the right, 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 following
such redemption, Securities with an aggregate stated 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 redemption.
"Tax Event" means that the Regular Trustees shall have received an
opinion from independent tax counsel experienced in such matters (a "Dissolution
Tax Opinion") to the effect that, on or after the date of the Prospectus, 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 therefor 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, governmental agency or regulatory
authority, which amendment or change is enacted, promulgated, issued or
announced or which interpretation or pronouncement is issued or announced or
which action is taken, in each case on or after the date of the Prospectus,
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 other 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.
"Investment Company Event" means that the Regular Trustees shall have
received an opinion from independent counsel experienced in practice under the
Investment Company Act that, as a result of the occurrence of a change in law or
regulation or a written change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority (a "Change in 1940 Act Law"), there is more than an insubstantial risk
that the Trust is or will be considered an Investment Company which is required
to be registered under the Investment Company Act, which Change in 1940
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Act Law becomes effective on or after the date of the Prospectus.
On and from the date fixed by the 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 certificates representing Securities, except for
certificates representing Preferred Securities held by the Depository or its
nominee (or any successor Clearing Agency or its nominee), will be deemed to
represent beneficial interests in the Debentures 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, 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 distribution of Debentures in exchange for, the
Securities (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 purposes of the calculation of the
date of redemption or exchange and the dates on which notices are given
pursuant to this Section 4(f)(i), a Redemption/Distribution Notice shall be
deemed to be given on the day such notice is first mailed by first-class
mail, postage 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
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validity of the redemption or exchange proceedings with respect to any
other Holder.
(ii) In the event that fewer than all the outstanding Securities are
to be redeemed, the Securities to be redeemed shall be redeemed Pro Rata
from each Holder of Preferred Securities; provided that if, as a result of
such Pro Rata redemption, Clearing Agency Participants would hold
fractional interests in the Preferred Securities, the Depository will
adjust the amount of the interest of each Clearing Agency Participant 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 Section 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 Depository or its nominee (or
successor Clearing Agency or its nominee) 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) if the
Preferred Securities are issued in definitive form, with respect to the
Preferred Securities, and with respect to the Common Securities, provided
that the Debenture Issuer has paid the Property Trustee a sufficient amount
of cash in connection with the related redemption or maturity of the
Debentures, the Property Trustee will pay the relevant Redemption Price to
the Holders 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, 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 interest on such Redemption
Price. Neither the Regular Trustees nor the Trust shall be required to
register or cause to be registered the transfer of any Securities which
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
Business Day (and without any interest or other payment in respect of any
such delay)
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except that, if such Business Day falls in the next calendar year, such
payment will be made on the immediately 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 Redemption Price in respect of 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 calculating the Redemption Price.
(iv) Redemption/Distribution Notices shall be sent to (A) in respect
of the Preferred Securities, the Depository or its nominee (or any
successor Clearing Agency or its nominee) if Global Certificates have been
issued or if Definitive Preferred Security Certificates have been issued,
to the Holders thereof, and (B) in respect of the Common Securities, to the
Holders thereof.
(v) Subject to the foregoing and applicable law (including, without
limitation, United States federal securities laws), the Sponsor or any of
its Affiliates may at any time and from time to time purchase outstanding
Preferred Securities by tender, in the open market or by private agreement.
5. Voting Rights - Preferred Securities. (a) Except as provided
under Sections 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) 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 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 and place of conducting
any proceeding for any remedy available to the Debenture Trustee, or executing
any trust or power conferred on the Debenture Trustee with respect to the
Debentures, (ii) waive any past default and its consequences that is waivable
under the Indenture, (iii) exercise any right to rescind or annul a declaration
that the principal of all the Debentures shall be due and payable, or (iv)
consent to any amendment, modification or termination of the Indenture or the
Debentures, where such consent shall be required, provided, however, that where
a consent under the Indenture would require the consent 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 at the
direction of the Holders of at
- 8 -
<PAGE>
least the proportion in liquidation amount of the Preferred Securities which the
relevant Super Majority represents of the aggregate principal amount of the
Debentures. 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 independent 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 and that each Holder of the Securities will be treated as owning an
undivided beneficial interest in the Debentures on 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
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 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 Debentures 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 circumstances described above, any of the
Preferred Securities that are owned by the Sponsor, or by any entity directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Sponsor shall not be entitled to vote or consent and shall, for
purposes of such vote or consent, be treated as if they were not outstanding.
6. Voting Rights - Common Securities. (a) Except as provided under
Section 6(b) and (c) and as otherwise required by
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<PAGE>
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 increase or decrease the number of Trustees.
(c) Only after the Event of Default with respect to the Preferred
Securities has been cured, waived or otherwise eliminated, 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 and place of conducting any proceeding for any remedy
available to the Debenture Trustee, or executing any trust or power conferred on
the Debenture Trustee with respect to the Debentures, (ii) waive any past
default and its consequences that is waivable under Section 6.06 of the
Indenture, (iii) exercise any right to rescind or annul a declaration that the
principal of all the Debentures shall be due and payable, or (iv) consent to any
amendment, modification or termination of the Indenture or the Debentures, where
such consent shall be required, provided, however, that where a consent under
the Indenture would require the consent of 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 Common Securities which the relevant
Super Majority represents of the aggregate principal amount of the Debentures.
The Property Trustee shall not take any action in accordance 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 be classified
as an association taxable as a corporation or a partnership and that each Holder
of the Securities will be treated as owning an undivided beneficial interest in
the Debentures on account of such action. If the Property Trustee fails to
enforce its rights under the Declaration, 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 Securities may be given
at a separate meeting of Holders of Common Securities convened for such purpose,
at a meeting of all of the Holders of Securities in the Trust or pursuant to
written consent. The Regular Trustees will cause a notice of any meeting
- 10 -
<PAGE>
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 Securities will be
required for the Trust to redeem and cancel Common Securities or to distribute
the Debentures in accordance with the Declaration and the terms of the
Securities.
7. Amendments. 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 Trust
Securities, whether by way of amendment to the Declaration or otherwise, or (ii)
the dissolution, winding-up or termination of the Trust, other than as described
in Section 8.1 of the Declaration, then the Holders of outstanding Trust
Securities, as a single 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 Trust Securities affected thereby,
provided that a reduction of the aggregate liquidation amount or the
distribution rate, or a change in the payment dates or maturities of the
Preferred Securities shall not be permitted without the consent of each holder
of the Preferred Securities. In the event any amendment or proposal referred to
in clause (i) above would adversely affect only the Preferred Securities or 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 Trust
Securities.
8. Pro Rata. A reference in these terms of the Securities to any
payment, distribution or treatment as being "Pro Rata" shall mean pro rata to
each Holder 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
- 11 -
<PAGE>
all amounts owed to the Holders of the Preferred Securities, to each Holder of
Common Securities pro rata according to the aggregate liquidation amount of
Common Securities held by the relevant Holder relative to the aggregate
liquidation amount of all Common Securities outstanding.
9. Ranking. The Preferred Securities rank pari passu and payment
thereon shall be made Pro Rata with the Common Securities except that when an
Event of Default occurs and is continuing, the rights of Holders of the Common
Securities to payment in respect of Distributions and payments upon liquidation,
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, Inc.
11. Acceptance of Securities Guarantees 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, respectively, including the subordination provisions
therein and to the 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 and the Preferred
Securities Guarantee to a Holder without charge on written request to the
Sponsor at its principal place of business.
- 12 -
<PAGE>
Annex I
Form of Preferred Security Certificate
[IF 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 "Depository") or a nominee of the Depository. This Preferred
Security is exchangeable for Preferred Securities registered in the name of a
person other than the Depository or its nominee only in the limited
circumstances described in the Declaration and no transfer of this Preferred
Security as a whole (except 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 Preferred Security is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New York, New
York) to the Trust or its agent for registration of transfer, exchange or
payment, and any Preferred Security issued is registered in the name of Cede &
Co. or such other name as is requested by an authorized representative of The
Depository Trust Company and any payment 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
COMED FINANCING I
Preferred Securities
(Liquidation Amount $25 per Preferred Security)
COMED FINANCING I, a business trust formed under the laws of the State
of Delaware (the "Trust"), hereby certifies that ________ (the "Holder") is the
registered owner of preferred securities of the Trust representing undivided
beneficial interests in the assets of the Trust designated the ____% Trust
Originated Preferred Securities (liquidation 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
- I-1 -
<PAGE>
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 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 Preferred Securities as set forth in Exhibit A to the Declaration.
Capitalized terms used herein but not defined herein shall have the respective
meanings given them in the Declaration. The Holder is entitled to the benefits
of the Preferred Securities Guarantee to the extent provided therein. The Trust
will provide a copy of the Declaration and the Preferred Securities Guarantee to
the 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 the Debentures as
indebtedness and the Preferred Securities as evidence of indirect beneficial
ownership in the Debentures.
IN WITNESS WHEREOF, the Trust has executed this certificate this
________ day of ________, ________.
_________________________
as Trustee
By: ____________________
__________________________
as Trustee
_________________________
as Trustee
__________________________
- I-2 -
<PAGE>
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 Preferred Security
Certificate.)
- I-3 -
<PAGE>
Annex II
Form of Common Security Certificate
Certificate Number Number of Common Securities
Certificate Evidencing Common Securities
of
COMED FINANCING I
Common Securities
(Liquidation Amount $25 per Common Security)
COMED FINANCING I, a business trust formed under the laws of the State
of Delaware (the "Trust"), hereby certifies that _____ (the "Holder") is the
registered owner of common securities of the Trust representing undivided
beneficial interests in the assets of the Trust designated 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 Securities represented hereby are issued and shall in
all respects be subject to the provisions of the 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 herein shall have the respective meanings 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 and the Common Securities Guarantee to the 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 the Debentures as
indebtedness and the Common Securities as evidence of indirect beneficial
ownership in the Debentures.
- II-1 -
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate this ____
day of ________, ________.
_______________________________
as Trustee
By: __________________________
_______________________________
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 Common Security
Certificate.)
- II-2 -
<PAGE>
EXHIBIT B
=====================================
COMMON SECURITIES GUARANTEE AGREEMENT
ComEd Financing I
Dated as of ________, 1995
=====================================
<PAGE>
COMMON SECURITIES GUARANTEE AGREEMENT
THIS COMMON SECURITIES GUARANTEE AGREEMENT (this "Guarantee
Agreement"), dated as of ________, 1995, is executed and delivered by
COMMONWEALTH EDISON COMPANY, an Illinois corporation (the "Guarantor"), for the
benefit of the Holders (as defined herein) from time to time of the Common
Securities (as defined in the Declaration) of ComEd Financing I, a Delaware
business trust (the "Issuer").
W I T N E S S E T H:
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
Common Securities designated the ________% Trust Originated Common Securities
(the "Common Securities"); and
WHEREAS, as incentive for the Holders to purchase the Common
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
Common Securities the Guarantee Payments (as defined herein) and to make certain
other payments on the terms and conditions set forth herein; and
WHEREAS, the Guarantor is also executing and delivering a guarantee
agreement (the "Preferred Securities Guarantee") in substantially identical
terms to this Guarantee Agreement for the benefit of the holders of the
Preferred Securities, except that if an Event of Default (as defined in the
Indenture), has occurred and is continuing, the rights of Holders of the Common
Securities to receive Guarantee Payments under this Guarantee Agreement are
subordinated to the rights of holders of Preferred Securities to receive
guarantee payments under the Preferred Securities Guarantee Agreement;
NOW, THEREFORE, in consideration of the purchase by each Holder of
Common 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. In this Guarantee Agreement, unless the
context otherwise requires, the terms set forth below shall have the following
meanings. Terms defined in the Declara-
<PAGE>
tion as at the date of execution of this Guarantee Agreement have the same
meaning when used in this Guarantee Agreement unless otherwise defined in this
Guarantee Agreement.
"Guarantee Payments" shall mean the following payments or
distributions, without duplication, with respect to the Common Securities,
to the extent not paid or made by the Issuer: (i) any accrued and unpaid
Distributions that are required to be paid on such Common Securities to the
extent the Issuer shall have funds available therefor, (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 Common Securities called for
redemption by the Issuer, and (iii) upon a voluntary or involuntary
dissolution, winding-up or termination of the Issuer (other than in
connection with the distribution of Debentures to the Holders in exchange
for Common Securities as provided in the Declaration), the lesser of (a)
the aggregate of the liquidation amount and all accrued and unpaid
Distributions on the Common 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 (as defined in the Indenture) has
occurred and is continuing, the rights of Holders of the Preferred
Securities to receive Guarantee Payments under this Guarantee Agreement are
subordinated to the rights of holders of Preferred Securities to receive
guarantee payments under the Preferred Securities Guarantee.
"Holder" shall mean any holder, as registered on the books and records
of the Issuer, of any Common Securities.
Section 1.2. Interpretation. Each definition in this Guarantee
Agreement includes the singular and the plural, and references to the neuter
gender include the masculine and feminine where appropriate. Terms which relate
to accounting matters shall be interpreted in accordance with generally accepted
accounting principles in effect from time to time. References to any statute
mean such statute as amended at the time and include any successor legislation.
The word "or" is not exclusive, and the words "herein," "hereof" and "hereunder"
refer to this Guarantee Agreement as a whole. The headings to the Articles and
Sections are for convenience of reference and shall not affect the meaning or
interpretation of this Guarantee Agreement. References to Articles and Sections
mean the Articles and Sections of this Guarantee Agreement unless otherwise
specified.
-3-
<PAGE>
ARTICLE II
GUARANTEE
Section 2.1. 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 2.2. 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 2.3. 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 otherwise, of the
performance or observance by the Issuer of any express or implied
agreement, covenant, term or condition relating to the Common 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 Common Securities or the
extension of time for the performance of any other obligation under,
arising out of, or in connection with, the Common Securities (other than an
extension of time for payment of Distributions, Redemption Price,
Liquidation Distribution or other sum payable that results from the
extension of any interest payment period on the Debentures 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 Common
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
-4-
<PAGE>
(d) the voluntary or involuntary liquidation, dissolution, sale of
any collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or
readjustment of debt of, or other similar proceedings affecting, the Issuer
or any of the assets of the Issuer;
(e) any invalidity of, or defect or deficiency in, the Common
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute
a legal or equitable discharge or defense of a guarantor, it being the
intent of this Section 2.3 that the obligations of the Guarantor hereunder
shall be absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain consent
of, the Guarantor with respect to the occurrence of any of the foregoing.
Section 2.4. Rights of Holders. The Guarantor expressly
acknowledges that any Holder of Common Securities may institute a legal
proceeding directly against the Guarantor to enforce its rights under this
Guarantee Agreement, without first instituting a legal proceeding against the
Issuer or any other Person.
Section 2.5. Guarantee of Payment. This Guarantee Agreement creates
a guarantee of payment and not of collection.
Section 2.6. Subrogation. The Guarantor shall be subrogated to all
(if any) rights of the Holders of Common 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 rights 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 2.7. Independent Obligations. The Guarantor acknowledges
that its obligations hereunder are independent of the obligations of the Issuer
with respect to the Common Securities, and that the Guarantor shall be liable as
principal and as debtor hereunder to make Guarantee Payments pursuant to the
terms
-5-
<PAGE>
of this Guarantee Agreement notwithstanding the occurrence of any event referred
to in subsections (a) through (g), inclusive, of Section 2.3 hereof.
ARTICLE III
LIMITATION OF TRANSACTIONS; SUBORDINATION
Section 3.1. Limitation of Transactions. So long as any Common
Securities remain outstanding, if (i) the Guarantor shall be in default with
respect to its Guarantee Payments or other obligations hereunder, or (ii) there
shall have occurred any event of default under the Declaration, then (a) the
Guarantor shall not, and shall cause any subsidiary of the Guarantor which is
not a wholly-owned 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 a liquidation payment 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.
Section 3.2. 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 IV
TERMINATION
Section 4.1. Termination. This Guarantee Agreement shall terminate
(i) upon full payment of the Redemption Price of all Common Securities, (ii)
upon the distribution of the Debentures to the Holders of all of the Common
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 Common Securities must restore
payment of any sums paid under the Common Securities or under this Guarantee
Agreement.
-6-
<PAGE>
ARTICLE V
MISCELLANEOUS
Section 5.1. 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
benefit of the Holders of the Common Securities then outstanding.
Section 5.2. Amendments. Except with respect to any changes which 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 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 the outstanding Common 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 5.3. 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 Issuer, in care of the Regular Trustees at the
Issuer's mailing address set forth below (or such other address as the
Issuer may give notice of to the Holders of the Common Securities):
ComEd Financing I
c/o Commonwealth Edison Company
10 South Dearborn Street - 37th Floor
Chicago, Illinois 60697-0767
Attention: Treasurer
(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 Common Securities):
Commonwealth Edison Company
10 South Dearborn Street - 37th Floor
Chicago, Illinois 60697-0767
Attention: Treasurer
(c) if given to any Holder of Common 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
-7-
<PAGE>
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 5.4. Benefit. This Guarantee Agreement is solely for the
benefit of the Holders and is not separately transferable from the Common
Securities.
Section 5.5. Governing Law. THIS GUARANTEE AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK.
THIS GUARANTEE AGREEMENT is executed as of the day and year first
above written.
COMMONWEALTH EDISON COMPANY
By: ____________________________
Name:
Title:
-8-
<PAGE>
Exhibit (4)-3
Commonwealth Edison Company
Form S-3
File No. 33-
COMMONWEALTH EDISON COMPANY,
Issuer
AND
WILMINGTON TRUST COMPANY,
Trustee
INDENTURE
Dated as of _________________, 1995
Subordinated Debt Securities
<PAGE>
CROSS-REFERENCE TABLE*
Section of
Trust Indenture Act Section of
of 1939, as amended Indenture
- ------------------- ----------
310(a) 7.09
310(b) 7.08
7.10
310(c) Inapplicable
311(a) 7.13(a)
311(b) 7.13(b)
311(c) Inapplicable
312(a) 5.01
5.02(a)
312(b) 5.02(b)
312(c) 5.02(c)
313(a) 5.04(a)
313(b) 5.04(b)
313(c) 5.04(a)
5.04(b)
313(d) 5.04(c)
314(a) 5.03
314(b) Inapplicable
314(c) 13.06
314(d) Inapplicable
314(e) 13.06
314(f) Inapplicable
315(a) 7.01(a)
7.02
315(b) 6.07
315(c) 7.01
315(d) 7.01(b)
7.01(c)
315(e) 6.07
316(a) 6.06
8.04
316(b) 6.04
316(c) 8.01
317(a) 6.02
317(b) 4.03
318(a) 13.08
*This Cross-Reference Table does not constitute part of the Indenture and shall
not have any bearing on the interpretation of Any of its terms or provisions.
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THIS INDENTURE, dated as of ________________, 1995, between
COMMONWEALTH EDISON COMPANY, an Illinois corporation (the "Company"), WILMINGTON
TRUST COMPANY, a Delaware banking corporation, not in its individual capacity
but solely as trustee (the "Trustee"):
W I T N E S S E T H:
WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the execution and delivery of this Indenture to provide for the
issuance of unsecured subordinated debt securities (hereinafter referred to as
the "Debt Securities"), in an unlimited aggregate principal amount to be issued
from time to time in one or more series as in this Indenture provided, as
registered Debt Securities without coupons, to be authenticated by the
certificate of the Trustee;
WHEREAS, to provide the terms and conditions upon which the Debt
Securities are to be authenticated, issued and delivered, the Company has duly
authorized the execution of this Indenture; and
WHEREAS, all things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done;
NOW, THEREFORE, in consideration of the premises and the purchase of
the Debt Securities by the holders thereof, it is mutually covenanted and agreed
as follows for the equal and ratable benefit of the holders of Debt Securities:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions of Terms. The terms defined in this
Section (except as in this Indenture otherwise expressly provided or unless the
context otherwise requires) for all purposes of this Indenture and of any
indenture supplemental hereto shall have the respective meanings specified in
this Section and shall include the plural as well as the singular. All other
terms used in this Indenture that are defined in the Trust Indenture Act of
1939, as amended, or that are by reference in such Act defined in the Securities
Act of 1933, as amended (except as herein otherwise expressly provided or unless
the context otherwise requires), shall have the meanings assigned to such terms
in said Trust Indenture Act and in said Securities Act as in force at the date
of the execution of this instrument.
"Affiliate" means, with respect to a specified Person, (a) any Person
directly or indirectly owning, controlling or holding with power to vote
10% or more of the outstanding voting securities or other ownership
interests of the specified Person, (b) any Person 10% or more of whose
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outstanding voting securities or other ownership interests are directly or
indirectly owned, controlled or held with power to vote by the specified
Person, (c) any Person directly or indirectly controlling, controlled by or
under common control with the specified Person, (d) a partnership in which
the specified Person is a general partner, (e) any officer or director of
the specified Person and (f) if the specified Person is an individual, any
entity of which the specified Person is an officer, director or general
partner.
"Authenticating Agent" means an authenticating agent with respect to
all or any of the series of Debt Securities appointed with respect to all
or such series of the Debt Securities by the Trustee pursuant to Section
2.10.
"Bankruptcy Law" means Title 11, United States Code, or any similar
federal or state law for the relief of debtors.
"Board of Directors" means the board of directors of the Company, or
any duly authorized committee of such board or any officer of the Company
duly authorized by the board of directors of the Company or a duly
authorized committee of that 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; provided that any Board Resolution that is
adopted by an officer of the Company shall be accompanied by a copy of a
resolution of either the board of directors of the Company or a duly
authorized committee of that board, certified as aforesaid, authorizing
such officer to take such action.
"Business Day" means, with respect to any series of Debt Securities,
any day other than a day on which federal or state banking institutions in
Wilmington, Delaware or the Borough of Manhattan, The City of New York, are
authorized or obligated by law, executive order or regulation to close.
"Certificate" means a certificate signed by the principal executive
officer, the principal financial officer, the treasurer or the principal
accounting officer of the Company. The Certificate need not comply with
the provisions of Section 13.07.
"ComEd Trust" means a Delaware business trust formed by the Company
for the purpose of purchasing Debt Securities of the Company.
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"Common Securities" means undivided beneficial interests in the assets
of a ComEd Trust which rank pari passu with Preferred Securities issued by
such trust; provided, however, that upon 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 maturity are
subordinated to the rights of holders of Preferred Securities.
"Common Securities Guarantee" means any guarantee that the Company may
enter into with a ComEd Trust or other Persons that operate directly or
indirectly for the benefit of holders of Common Securities of such trust.
"Company" means Commonwealth Edison Company, a corporation duly
organized and existing under the laws of the State of Illinois, and,
subject to the provisions of Article X, shall also include its successors
and assigns.
"Corporate Trust Office" means the office of the Trustee at which, at
any particular time, its corporate trust business shall be principally
administered, which office at the date hereof is located at ______________,
Attention: ____________, except that whenever a provision herein refers to
an office or agency of the Trustee in the Borough of Manhattan, The City of
New York, such office is located, at the date hereof, at ____________, New
York, New York ______.
"Custodian" means any receiver, trustee, assignee, liquidator, or
similar official under any Bankruptcy Law.
"Declaration" means, in respect of a ComEd Trust, the amended and
restated declaration of trust of such ComEd Trust or any other governing
instrument of such Trust.
"Debt Securities" means the Debt Securities authenticated and
delivered under this Indenture.
"Default" means any event, act or condition that with notice or lapse
of time, or both, would constitute an Event of Default.
"Defaulted Interest" has the meaning specified in Section 2.03.
"Depositary" means, with respect to Debt Securities of any series for
which the Company shall determine that such Debt Securities will be issued
as a Global Security, The Depository Trust Company, New York, New York,
another clearing agency, or any successor registered as a clearing agency
under the Exchange Act or other applicable statute or regulation, which, in
each case, shall be designated by the Company pursuant to either Section
2.01 or 2.11.
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"Event of Default" means, with respect to Debt Securities of a
particular series, any event specified in Section 6.01, continued for the
period of time, if any, therein designated.
"Exchange Act" means the Securities Exchange Act of 1934.
"Global Security" means, with respect to any series of Securities, a
Debt Security executed by the Company and delivered by the Trustee to the
Depositary or pursuant to the Depositary's instruction, all in accordance
with the Indenture, which shall be registered in the name of the Depositary
or its nominee.
"Governmental Obligations" means securities that are (i) direct
obligations of the United States of America for the payment of which its
full faith and credit is pledged or (ii) obligations of a Person controlled
or supervised by and acting as an agency or instrumentality of the United
States of America, the payment of which is unconditionally guaranteed as a
full faith and credit obligation by the United States of America that, in
either case, are not callable or redeemable at the option of the issuer
thereof, and shall also include a depositary receipt issued by a bank (as
defined in Section 3(a)(2) of the Securities Act of 1933, as amended) as
custodian with respect to any such Governmental Obligation or a specific
payment of principal of or interest on any such Governmental Obligation
held by such custodian for the account of the holder of such depositary
receipt; provided, however, that (except as required by law) such custodian
is not authorized to make any deduction from the amount payable to the
holder of such depositary receipt from any amount received by the custodian
in respect of the Governmental Obligation or the specific payment of
principal of or interest on the Governmental Obligation evidenced by such
depositary receipt.
"herein", "hereof" and "hereunder", and other words of similar import,
refer to this Indenture as a whole and not to any particular Article,
Section or other subdivision.
"Indenture" means 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 in accordance with the terms hereof.
"Interest Payment Date", when used with respect to any installment of
interest on a Debt Security of a particular series, means the date
specified in such Debt Security or in a Board Resolution or in an indenture
supplemental hereto with respect to such series as the fixed date on which
an installment of interest with respect to Debt Securities of that series
is due and payable.
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<PAGE>
"Officers' Certificate" means a certificate signed by the President or
a Vice President and by the Treasurer or an Assistant Treasurer or the
Controller or an Assistant Controller or the Secretary or an Assistant
Secretary of the Company that is delivered to the Trustee in accordance
with the terms hereof. Each such certificate shall include the statements
provided for in Section 13.07, if and to the extent required by the
provisions thereof.
"Opinion of Counsel" means an opinion in writing of legal counsel, who
may be an employee of or counsel for the Company, that is delivered to the
Trustee in accordance with the terms hereof. Each such opinion shall
include the statements provided for in Section 13.07, if and to the extent
required by the provisions thereof.
"Outstanding", when used with reference to Debt Securities of any
series, means, subject to the provisions of Section 8.04, as of any
particular time, all Debt Securities of that series theretofore
authenticated and delivered by the Trustee under this Indenture, except (a)
Debt Securities theretofore canceled by the Trustee or any paying agent, or
delivered to the Trustee or any paying agent for cancellation or that have
previously been canceled; (b) Debt Securities or portions thereof for the
payment or redemption of which moneys or Governmental Obligations in the
necessary amount shall have been deposited in trust with the Trustee or
with any paying agent (other than the Company) or shall have been set aside
and segregated in trust by the Company (if the Company shall act as its own
paying agent); provided, however, that if such Debt Securities or portions
of such Debt Securities are to be redeemed prior to the maturity thereof,
notice of such redemption shall have been given as in Article III provided,
or provision satisfactory to the Trustee shall have been made for giving
such notice, (c) Debt Securities in lieu of or in substitution for which
other Debt Securities shall have been authenticated and delivered pursuant
to the terms of Section 2.07; and (d) Debt Securities, except to the extent
provided in Sections 15.02 and 15.03, with respect to which the Company has
effected defeasance and/or covenant defeasance as provided in Article XV.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, joint-stock company, unincorporated
organization or government or any agency or political subdivision thereof.
"Predecessor Security" of any particular Debt Security means every
previous Debt Security evidencing all or a portion of the same debt and
guarantee as that evidenced by such particular Debt Security; and, for the
purposes of this definition, any Debt Security authenticated and delivered
under Section 2.07 in lieu of a lost, destroyed or stolen Debt
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Security shall be deemed to evidence the same debt as the lost, destroyed
or stolen Debt Security.
"Preferred Securities" means undivided beneficial interests in the
assets of ComEd Trust which rank pari passu with Common Securities issued
by such trust; provided, however, that upon 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 otherwise
are subordinated to the rights of holders of Preferred Securities.
"Preferred Securities Guarantee" means any guarantee that the Company
may enter into with a ComEd Trust or other Persons that operate directly or
indirectly for the benefit of holders of Preferred Securities of such
trust.
"Property Trustee" means the entity performing the functions of the
Property Trustee of a ComEd Trust under the applicable Declaration of such
ComEd Trust.
"Responsible Officer," when used with respect to the Trustee, means
the Chairman of the Board of Directors, the President, any Vice President,
the Secretary, the Treasurer, any trust officer, any corporate trust
officer or any other officer or assistant officer of the Trustee
customarily performing functions similar to those performed by the Persons
who at the time shall be such officers, respectively, or to whom any
corporate trust matter is referred because of his or her knowledge of and
familiarity with the particular subject.
"Securityholder", "holder of Debt Securities", "registered holder", or
other similar term, means the Person or Persons in whose name or names a
particular Debt Security shall be registered on the books of the Company
kept for that purpose in accordance with the terms of this Indenture.
"Security Register" and "Security Registrar" have the respective
meanings set forth in Section 2.05.
"Subsidiary" means, with respect to any Person, (i) any corporation at
least a majority of whose outstanding Voting Stock shall at the time be
owned, directly or indirectly, by such Person or by one or more of its
Subsidiaries or by such Person and one or more of its Subsidiaries, (ii)
any general partnership, joint venture or similar entity, at least a
majority of whose outstanding partnership or similar interests shall at the
time be owned by such Person, or by one or more of its Subsidiaries, or by
such Person and one or more of its Subsidiaries and (iii) any limited
partnership of which such Person or any of its Subsidiaries is a general
partner.
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<PAGE>
"Trustee" means Wilmington Trust Company, not in its individual
capacity, and, subject to the provisions of Article VII, shall also include
its successors and assigns, and, if at any time there is more than one
Person acting in such capacity hereunder, "Trustee" shall mean each such
Person. The term "Trustee," as used with respect to a particular series of
Debt Securities, shall mean the trustee with respect to that series.
"Trust Indenture Act" means the Trust Indenture, subject to the
provisions of Sections 9.01, 9.02 and 10.01, as in effect at the date of
execution of this instrument.
"Trust Securities" means Common Securities and Preferred Securities.
"Voting Stock", as applied to stock of any Person, means shares,
interests, participations or other equivalents in the equity interest
(however designated) in such Person having ordinary voting power for the
election of a majority of the directors (or the equivalent) of such Person,
other than shares, interests, participations or other equivalents having
such power only by reason of the occurrence of a contingency.
ARTICLE II
ISSUE, DESCRIPTION, TERMS, EXECUTION,
REGISTRATION AND EXCHANGE OF DEBT SECURITIES
SECTION 2.01. Designation and Terms of Debt Securities. The
aggregate principal amount of Debt Securities that may be authenticated and
delivered under this Indenture is unlimited. The Debt Securities may be issued
in one or more series up to the aggregate principal amount of Debt Securities
of that series from time to time authorized by or pursuant to a Board
Resolution of the Company or, pursuant to one or more indentures supplemental
hereto. Prior to the initial issuance of Debt Securities of any series, there
shall be established in or pursuant to a Board Resolution of the Company, and
set forth in an Officers' Certificate of the Company, or established in one or
more indentures supplemental hereto:
(1) the title of the series of Debt Security (which shall distinguish
the Debt Securities of that series from all other series of Debt
Securities);
(2) any limit upon the aggregate principal amount of the Debt
Securities of that series that may be authenticated and delivered under
this Indenture (except for Debt Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other Debt
Securities of that series);
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(3) the date or dates on which the principal of the Debt Securities
of that series is payable;
(4) the rate or rates at which the Debt Securities of that series
shall bear interest or the manner of calculation of such rate or rates, if
any;
(5) the date or dates from which such interest shall accrue, the
Interest Payment Dates on which such interest will be payable or the manner
of determination of such Interest Payment Dates and the record date for the
determination of holders to whom interest is payable on any such Interest
Payment Dates;
(6) the right, if any, to extend the interest payment periods and the
duration of such extension;
(7) the period or periods within which, the price or prices at which,
and the terms and conditions upon which, Debt Securities of that series may
be redeemed, in whole or in part, at the option of the Company;
(8) the obligation, if any, of the Company to redeem or purchase Debt
Securities of that series pursuant to any sinking fund or analogous
provisions (including payments made in cash in participation of future
sinking fund obligations) or at the option of a holder thereof and the
period or periods within which, the price or prices at which, and the terms
and conditions upon which, Debt Securities of that series shall be redeemed
or purchased, in whole or in part, pursuant to such obligation;
(9) the subordination terms of the Debt Securities of that series;
(10) the form of the Debt Securities of that series, including the
form of the Certificate of Authentication for such series;
(11) if other than denominations of twenty-five U.S. dollars ($25) or
any integral multiple thereof, the denominations in which the Debt
Securities of that series shall be issuable;
(12) whether and under what circumstances the Company will pay
Additional Amounts as contemplated by Section 4.08 on the Debt 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 Debt Securities rather than pay such Additional
Amounts (and the terms of any such option);
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(13) any and all other terms with respect to such series (which terms
shall not be inconsistent with the terms of this Indenture), including any
terms which may be required by or advisable under United States laws or
regulations or advisable in connection with the marketing of Debt
Securities of that series; and
(14) whether the Debt Securities are issuable as a Global Security
and, in such case, the identity of the Depositary for such series.
All Debt Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided in or pursuant
to any such Board Resolution or in any indentures supplemental hereto.
If any of the terms of a series are established by action taken
pursuant to a Board Resolution of the Company, 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
Officers' Certificate of the Company setting forth the terms of such series.
SECTION 2.02. Form of Debt Securities and Trustee's Certificate. The
Debt Securities of any series and the Trustee's certificate of authentication to
be borne by such Debt Securities shall be substantially of the tenor and purport
as set forth in one or more indentures supplemental hereto or as provided in a
Board Resolution of the Company and as set forth in an Officers' Certificate of
the Company, and may have such letters, numbers or other marks of identification
or designation and such legends or endorsements printed, lithographed or
engraved thereon as the Company may deem appropriate and as are not inconsistent
with the provisions of this Indenture, 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 Debt Securities of that series may be
listed, or to conform to usage.
SECTION 2.03. Denominations; Provisions for Payment. The Debt
Securities shall be issuable as registered Debt Securities and in the
denominations of twenty-five U.S. dollars ($25) or any integral multiple
thereof, subject to Section 2.01(11). The Debt Securities of a particular series
shall bear interest payable on the dates and at the rate specified with respect
to that series. The principal of and the interest on the Debt Securities of any
series, as well as any premium thereon in case of redemption thereof prior to
maturity, shall be payable in the coin or currency of the United States of
America that at the time is legal tender for public and private debt, at the
office or agency of the Company maintained for that purpose in the Borough of
Manhattan, the City and State of New York. Each Debt Security shall be dated
the date of its authentication. Interest on the Debt Securities shall be
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computed on the basis of a 360-day year composed of twelve 30-day months.
The interest installment on any Debt Security that is payable, and is
punctually paid or duly provided for, on any Interest Payment Date for Debt
Securities of that series shall be paid to the Person in whose name said Debt
Security (or one or more Predecessor Debt Securities) is registered at the close
of business on the regular record date for such interest installment. In the
event that any Debt Security of a particular series or portion thereof is called
for redemption and the redemption date is subsequent to a regular record date
with respect to any Interest Payment Date and prior to such Interest Payment
Date, interest on such Debt Security will be paid upon presentation and
surrender of such Debt Security as provided in Section 3.03.
Any interest on any Debt Security that is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date for Debt
Securities of that series (herein called "Defaulted Interest") shall forthwith
cease to be payable to the registered holder on the relevant regular record date
by virtue of having been such holder; and such Defaulted Interest shall be paid
by the Company, at its election, as provided in clause (1) or clause (2) below:
(1) The Company may make payment of any Defaulted Interest on Debt
Securities to the Persons in whose names such Debt Securities (or their
respective Predecessor Debt Securities) are registered at the close of
business on a special record date for the payment of such Defaulted
Interest, which shall be fixed in the following manner: the Company shall
notify the Trustee in writing of the amount of Defaulted Interest proposed
to be paid on each such Debt Security and the date of the proposed payment,
and at the same time the Company shall deposit with the Trustee an amount
of money equal to the aggregate amount proposed to be paid in respect of
such Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this clause provided. Thereupon
the Trustee shall fix a special record date for the payment of such
Defaulted Interest which shall not be more than 15 nor less than 10 days
prior to the date of the proposed payment and not less than 10 days after
the receipt by the Trustee of the notice of the proposed payment. The
Trustee shall promptly notify the Company of such special record date and,
in the name and at the expense of the Company, shall cause notice of the
proposed payment of such Defaulted Interest and the special record date
therefor to be mailed, first class postage prepaid, to each Securityholder
at his or her address as it appears in the Security Register (as
hereinafter defined), not less than 10 days prior to such special record
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date. Notice of the proposed payment of such Defaulted Interest and the
special record date therefor having been mailed as aforesaid, such
Defaulted Interest shall be paid to the Persons in whose names such Debt
Securities (or their respective Predecessor Debt Securities) are registered
on such special record date and shall be no longer payable pursuant to the
following clause (2).
(2) The Company may make payment of any Defaulted Interest on any
Debt Securities in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Debt Securities may
be listed, and upon such notice as may be required by such exchange, if,
after notice given by the Company to the Trustees of the proposed payment
pursuant to this clause, such manner of payment shall be deemed practicable
by the Trustee.
Unless otherwise set forth in a Board Resolution of the Company or one
or more indentures supplemental hereto establishing the terms of any series of
Debt Securities pursuant to Section 2.01 hereof, the term "regular record date"
as used in this Section with respect to a series of Debt Securities with respect
to any Interest Payment Date for such series shall mean either the fifteenth day
of the month immediately preceding the month in which an Interest Payment Date
established for such series pursuant to Section 2.01 hereof shall occur, if such
Interest Payment Date is the first day of a month, or the last day of the month
immediately preceding the month in which an Interest Payment Date established
for such series pursuant to Section 2.01 hereof shall occur, if such Interest
Payment Date is the fifteenth day of a month, whether or not such date is a
Business Day.
Subject to the foregoing provisions of this Section, each Debt
Security of a series delivered under this Indenture upon transfer of or in
exchange for or in lieu of any other Debt Security of such series shall carry
the rights to interest accrued and unpaid, and to accrue, that were carried by
such other Debt Security.
SECTION 2.04. Execution and Authentication. The Debt Securities
shall be signed on behalf of the Company by its President or one of its Vice
Presidents, under its corporate seal attested by its Secretary or one of its
Assistant Secretaries. Signatures may be in the form of a manual or facsimile
signature. The Company may use the facsimile signature of any Person who shall
have been a President or Vice President thereof, or of any Person who shall have
been a Secretary or Assistant Secretary thereof, notwithstanding the fact that
at the time the Debt Securities shall be authenticated and delivered or disposed
of such Person shall have ceased to be the President or a Vice President, or the
Secretary or an Assistant Secretary, of the Company. The seal of the Company
may be in the form of a facsimile of such seal and may be impressed, affixed,
imprinted or otherwise reproduced on the
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Debt Securities. The Debt Securities may contain such notations, legends or
endorsements required by law, stock exchange rule or usage. Each Debt Security
shall be dated the date of its authentication by the Trustee.
A Debt Security shall not be valid until authenticated manually by an
authorized signatory of the Trustee, or by an Authenticating Agent. Such
signature shall be conclusive evidence that the Debt Security so authenticated
has been duly authenticated and delivered hereunder and that the holder is
entitled to the benefits of this Indenture.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Debt Securities of any series executed
by the Company to the Trustee for authentication, together with a written order
of the Company for the authentication and delivery of such Debt Securities,
signed by its President or any Vice President and its Treasurer or any Assistant
Treasurer, and the Trustee in accordance with such written order shall
authenticate and deliver such Debt Securities.
In authenticating such Debt Securities and accepting the additional
responsibilities under this Indenture in relation to such Debt Securities, the
Trustee shall be entitled to receive, and (subject to Section 7.01) shall be
fully protected in relying upon, an Opinion of Counsel stating that the form and
terms thereof have been established in conformity with the provisions of this
Indenture.
The Trustee shall not be required to authenticate such Securities if
the issue of such Debt Securities pursuant to this Indenture will affect the
Trustee's own rights, duties or immunities under the Debt Securities and this
Indenture or otherwise in a manner that is not reasonable acceptable to the
Trustee.
SECTION 2.05. Registration of Transfer and Exchange. (a) Debt
Securities of any series may be exchanged upon presentation thereof at the
office or agency of the Company designated for such purpose in the Borough of
Manhattan, the City and State of New York, for other Debt Securities of such
series of authorized denominations, and for a like aggregate principal amount,
upon payment of a sum sufficient to cover any tax or other governmental charge
in relation thereto, all as provided in this Section. In respect of any Debt
Securities so surrendered for exchange, the Company shall execute, the Trustee
shall authenticate and such office or agency shall deliver in exchange therefor
the Debt Security or Debt Securities of the same series that the Securityholder
making the exchange shall be entitled to receive, bearing numbers not
contemporaneously outstanding.
(b) The Company shall keep, or cause to be kept, at its office or
agency designated for such purpose in the Borough of
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Manhattan, the City and State of New York, or such other location designated by
the Company a register or registers (herein referred to as the "Security
Register") in which, subject to such reasonable regulations as it may prescribe,
the Company shall register the Debt Securities and the transfers of Debt
Securities as in this Article provided and which at all reasonable times shall
be open for inspection by the Trustee. The registrar for the purpose of
registering Securities and transfer of Securities as herein provided shall be
appointed as authorized by Board Resolution (the "Security Registrar").
Upon surrender for transfer of any Debt Security at the office or
agency of the Company designated for such purpose in the Borough of Manhattan,
the City and State of New York, the Company shall execute, the Trustee shall
authenticate and such office or agency shall deliver in the name of the
transferee or transferees a new Debt Security or Debt Securities of the same
series as the Debt Security presented for a like aggregate principal amount.
All Debt Securities presented or surrendered for exchange or
registration of transfer, as provided in this Section, shall be accompanied (if
so required by the Company or the Security Registrar) by a written instrument or
instruments of transfer, in form satisfactory to the Company or the Security
Registrar, duly executed by the registered holder or by such holder's duly
authorized attorney in writing.
(c) No service charge shall be made for any exchange or registration
of transfer of Debt Securities, or issue of new Debt Securities in case of
partial redemption of any series, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge in relation thereto,
other than exchanges pursuant to Section 2.06, Section 3.03(b) and Section 9.04
not involving any transfer.
(d) The Company shall not be required (i) to issue, exchange or
register the transfer of any Debt Securities during a period beginning at the
opening of business 15 days before the day of the mailing of a notice of
redemption of less than all the Outstanding Debt Securities of the same series
and ending at the close of business on the day of such mailing, nor (ii) to
register the transfer of or exchange any Debt Securities of any series or
portions thereof called for redemption. The provisions of this Section 2.05
are, with respect to any Global Security, subject to Section 2.11 hereof.
SECTION 2.06. Temporary Securities. Pending the preparation of
definitive Debt Securities of any series, the Company may execute, and the
Trustee shall authenticate and deliver, temporary Debt Securities (printed,
lithographed or typewritten) of any authorized denomination. Such temporary
Debt Securities shall be substantially in the form of the definitive Debt
Securities in lieu of which they are issued, but with such
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omissions, insertions and variations as may be appropriate for temporary Debt
Securities, all as may be determined by the Company. Every temporary Debt
Security of any series shall be executed by the Company and be authenticated by
the Trustee upon the same conditions and in substantially the same manner, and
with like effect, as the definitive Debt Securities of such series. Without
unnecessary delay the Company will execute and will furnish definitive Debt
Securities of such series and thereupon any or all temporary Debt Securities of
such series may be surrendered in exchange therefor (without charge to the
holders), at the office or agency of the Company designated for the purpose in
the Borough of Manhattan, the City and State of New York, and the Trustee shall
authenticate and such office or agency shall deliver in exchange for such
temporary Debt Securities an equal aggregate principal amount of definitive Debt
Securities of such series, unless the Company advises the Trustee to the effect
that definitive Debt Securities need not be executed and furnished until further
notice from the Company. Until so exchanged, the temporary Debt Securities of
such series shall be entitled to the same benefits under this Indenture as
definitive Debt Securities of such series authenticated and delivered hereunder.
SECTION 2.07. Mutilated, Destroyed, Lost or Stolen Debt Securities.
In case any temporary or definitive Debt Security shall become mutilated or be
destroyed, lost or stolen, the Company (subject to the next succeeding sentence)
shall execute, and upon the Company's request the Trustee (subject as aforesaid)
shall authenticate and deliver, a new Debt Security of the same series, bearing
a number not contemporaneously outstanding, in exchange and substitution for the
mutilated Debt Security, or in lieu of and in substitution for the Debt Security
so destroyed, lost or stolen. In every case the applicant for a substituted
Debt Security shall furnish to the Company and the Trustee such security or
indemnity as may be required by them to save each of them harmless, and, in
every case of destruction, loss or theft, the applicant shall also furnish to
the Company and the Trustee evidence to their satisfaction of the destruction,
loss or theft of the applicant's Debt Security and of the ownership thereof.
The Trustee may authenticate any such substituted Debt Security and deliver the
same upon the written request or authorization of any officer of the Company.
Upon the issuance of any substituted Debt Security, the Company may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses (including the fees
and expenses of the Trustee) connected therewith. In case any Debt Security
that has matured or is about to mature shall become mutilated or be destroyed,
lost or stolen, the Company may, instead of issuing a substitute Debt Security,
pay or authorize the payment of the same (without surrender thereof except in
the case of a mutilated Debt Security) if the applicant for such payment shall
furnish to the Company and the Trustee such security or indemnity as they may
require to save them harmless, and, in case of destruction, loss or theft,
evidence to the satisfaction of the
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Company and the Trustee of the destruction, loss or theft of such Debt Security
and of the ownership thereof.
Every replacement Debt Security issued pursuant to the provisions of
this Section shall constitute an additional contractual obligation of the
Company, whether or not the mutilated, destroyed, lost or stolen Debt Security
shall be found at any time, or be enforceable by anyone, and shall be entitled
to all the benefits of this Indenture equally and proportionately with any and
all other Debt Securities of the same series duly issued hereunder. All Debt
Securities shall be held and owned upon the express condition that the foregoing
provisions are exclusive with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Debt Securities, and shall preclude (to the
extent lawful) any and all other rights or remedies, notwithstanding any law or
statute existing or hereafter enacted to the contrary with respect to the
replacement or payment of negotiable instruments or other securities without
their surrender.
SECTION 2.08. Cancellation. All Debt Securities surrendered for the
purpose of payment, redemption, exchange or registration of transfer shall, if
surrendered to the Company or any paying agent, be delivered to the Trustee for
cancellation, or, if surrendered to the Trustee, shall be cancelled by it, and
no Debt Securities shall be issued in lieu thereof except as expressly required
or permitted by any of the provisions of this Indenture. On request of the
Company at the time of such surrender, the Trustee shall deliver to the Company
canceled Debt Securities held by the Trustee. In the absence of such request
the Trustee may dispose of canceled Debt Securities in accordance with its
standard procedures and deliver a certificate of disposition to the Company. If
the Company shall otherwise acquire any of the Debt Securities, however, such
acquisition shall not operate as a redemption or satisfaction of the
indebtedness represented by such Debt Securities unless and until the same are
delivered to the Trustee for cancellation.
SECTION 2.09. Benefits of Indenture. Nothing in this Indenture or in
the Debt Securities, express or implied, shall give or be construed to give to
any Person, other than the parties hereto and the holders of the Debt Securities
(and, with respect to the provisions of Article XIV, the holders of Senior
Indebtedness) any legal or equitable right, remedy or claim under or in respect
of this Indenture, or under any covenant, condition or provision herein
contained; all such covenants, conditions and provisions being for the sole
benefit of the parties hereto and of the holders of the Debt Securities (and,
with respect to the provisions of Article XIV, the holders of Senior
Indebtedness).
SECTION 2.10. Authenticating Agent. So long as any of the Debt
Securities of any series remain Outstanding, there may be an Authenticating
Agent for any or all such series of Debt Securities which the Trustee shall have
the right to appoint. Said
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Authenticating Agent shall be authorized to act on behalf of the Trustee to
authenticate Debt Securities of such series issued upon exchange, transfer or
partial redemption thereof, and Debt 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. All references in
this Indenture to the authentication of Debt Securities by the Trustee shall be
deemed to include authentication by an Authenticating Agent for such series.
Each Authenticating Agent shall be acceptable to the Company and shall be a
corporation that has a combined capital and surplus, as most recently reported
or determined by it, sufficient under the laws of any jurisdiction under which
it is organized or in which it is doing business to conduct a trust business,
and that is otherwise authorized under such laws to conduct such business and is
subject to supervision or examination by federal or state authorities. If at
any time any Authenticating Agent shall cease to be eligible in accordance with
these provisions, it shall resign immediately.
Any Authenticating Agent may at any time resign by giving written
notice of resignation to the Trustee and to the Company. The Trustee may at any
time (and upon request by the Company shall) terminate the agency of any
Authenticating Agent by giving written notice of termination to such
Authenticating Agent and to the Company. Upon resignation, termination or
cessation of eligibility of any Authenticating Agent, the Trustee may appoint an
eligible successor Authenticating Agent acceptable to the Company. Any
successor Authenticating Agent, upon acceptance of its appointment hereunder,
shall become vested with all the rights, powers and duties of its predecessor
hereunder as if originally named as an Authenticating Agent pursuant hereto.
SECTION 2.11. Global Securities. (a) If the Company shall establish
pursuant to Section 2.01 that the Debt Securities of a particular series are to
be issued as a Global Security or Securities, then the Company shall execute and
the Trustee shall, in accordance with Section 2.04, authenticate and deliver, a
Global Security that (i) shall represent, and shall be denominated in an amount
equal to the aggregate principal amount of, all of the Outstanding Debt
Securities of such series, (ii) shall be registered in the name of the
Depositary or its nominee, (iii) shall be delivered by the Trustee to the
Depositary or pursuant to the Depositary's instruction and (iv) shall bear a
legend substantially to the following effect: "Except as otherwise provided in
Section 2.11 of the Indenture, this Debt Security may be transferred, in whole
but not in part, only to another nominee of the Depositary or to a successor
Depositary or to a nominee of such successor Depositary."
(b) Notwithstanding the provisions of Section 2.05, the Global
Security or Securities of a series may be transferred, in whole but not in part
and in the manner provided in Section 2.05, only to another nominee of the
Depositary for such series, or to a
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successor Depositary for such series selected or approved by the Company or to a
nominee of such successor Depositary.
(c) If at any time the Depositary for a series of the Debt Securities
notifies the Company that it is unwilling or unable to continue as Depositary
for such series or if at any time the Depositary for such series shall no longer
be registered or in good standing under the Exchange Act, or other applicable
statute or regulation, at a time when the Depositary is required to be so
registered to act as such Depositary 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, this Section 2.11
shall no longer be applicable to the Debt Securities of such series and the
Company will execute, and subject to Section 2.05, the Trustee will authenticate
and deliver the Debt Securities of such series in definitive registered form
without coupons, in authorized denominations, and in an aggregate principal
amount equal to the principal amount of the Global Security or Securities of
such series in exchange for such Global Security or Securities. In addition, the
Company may at any time determine that the Debt Securities of any series shall
no longer be represented by a Global Security or Securities and that the
provisions of this Section 2.11 shall no longer apply to the Debt Securities of
such series. In such event, the Company will execute and subject to Section
2.05, the Trustee, upon receipt of an Officers' Certificate evidencing such
determination by the Company, will authenticate and deliver the Debt Securities
of such series in definitive registered form without coupons, in authorized
denominations, and in an aggregate principal amount equal to the principal
amount of the Global Security or Securities of such series in exchange for such
Global Security or Securities. Upon the exchange of the Global Security or
Securities for such Debt Securities in definitive registered form without
coupons, in authorized denominations, the Global Security or Securities shall be
canceled by the Trustee. Such Debt Securities in definitive registered form
issued in exchange for the Global Security or Securities pursuant to this
Section 2.11(c) shall be registered in such names and in such authorized
denominations as the Depositary, pursuant to instructions from its direct or
indirect participants or otherwise, shall instruct the Trustee. The Trustee
shall deliver such Debt Securities to the Depositary for delivery to the Persons
in whose names such Debt Securities are so registered.
ARTICLE III
REDEMPTION OF DEBT SECURITIES AND SINKING FUND PROVISIONS
SECTION 3.01. Redemption. The Company may redeem the Debt Securities
of any series issued hereunder on and after the dates and in accordance with the
terms established for such series pursuant to Section 2.01 hereof.
SECTION 3.02. Notice of Redemption. (a) In case the Company shall
desire to exercise such right to redeem all or, as
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the case may be, a portion of the Debt Securities of any series in accordance
with the right reserved so to do, the Company shall, or shall cause the Trustee
to, give notice of such redemption to holders of the Debt Securities of such
series to be redeemed by mailing, first class postage prepaid, a notice of such
redemption not less than 30 days and not more than 90 days before the date fixed
for redemption of that series to such holders at their last addresses as they
shall appear upon the Security Register unless a shorter period is specified in
the Debt Securities to be redeemed. Any notice that is mailed in the manner
herein provided shall be conclusively presumed to have been duly given, whether
or not the registered holder receives the notice. In any case, failure duly to
give such notice to the holder of any Debt Security of any series designated for
redemption in whole or in part, or any defect in the notice, shall not affect
the validity of the proceedings for the redemption of any other Debt Securities
of such series or any other series. In the case of any redemption of Debt
Securities prior to the expiration of any restriction on such redemption
provided in the terms of such Debt Securities or elsewhere in this Indenture,
the Company shall furnish the Trustee with an Officers' Certificate evidencing
compliance with any such restriction.
Each such notice of redemption shall specify the date fixed for
redemption and the redemption price at which Debt Securities of that series are
to be redeemed, and shall state that payment of the redemption price of such
Debt Securities to be redeemed will be made at the office or agency of the
Company in the Borough of Manhattan, the City and State of New York, upon
presentation and surrender of such Debt Securities, that interest accrued to the
date fixed for redemption will be paid as specified in said notice, that from
and after said date interest will cease to accrue and that the redemption is for
a sinking fund, if such is the case. If less than all the Debt Securities of a
series are to be redeemed, the notice to the holders of Debt Securities of that
series to be redeemed in whole or in part shall specify the particular Debt
Securities to be so redeemed. In case any Debt Security is to be redeemed in
part only, the notice that relates to such Debt Security shall state the portion
of the principal amount thereof to be redeemed, and shall state that on and
after the redemption date, upon surrender of such Debt Security, a new Debt
Security or Debt Securities of such series in principal amount equal to the
unredeemed portion thereof will be issued.
(b) If less than all the Debt Securities of a series are to be
redeemed, the Company shall give the Trustee at least 45 days' notice in advance
of the date fixed for redemption as to the aggregate principal amount of Debt
Securities of the series to be redeemed, and thereupon the Trustee shall select,
by lot or in such other manner as it shall deem appropriate and fair in its
discretion and that may provide for the selection of a portion or portions
(equal to twenty-five U.S. dollars ($25) or any integral multiple thereof) of
the principal amount of such Debt Securities of a denomination larger than $25,
the Debt Securities to be
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redeemed and shall thereafter promptly notify the Company in writing of the
numbers of the Debt Securities to be redeemed, in whole or in part.
The Company may, if and whenever it shall so elect, by delivery of
instructions signed on its behalf by its President or any Vice President,
instruct the Trustee or any paying agent to call all or any part of the Debt
Securities of a particular series for redemption and to give notice of
redemption in the manner set forth in this Section, such notice to be in the
name of the Company or its own name as the Trustee or such paying agent may deem
advisable. In any case in which notice of redemption is to be given by the
Trustee or any such paying agent, the Company shall deliver or cause to be
delivered to, or permit to remain with, the Trustee or such paying agent, as the
case may be, such Security Register, transfer books or other records, or
suitable copies or extracts therefrom, sufficient to enable the Trustee or such
paying agent to give any notice by mail that may be required under the
provisions of this Section.
SECTION 3.03. Payment Upon Redemption. (a) If the giving of notice
of redemption shall have been completed as above provided, the Debt Securities
or portions of Debt Securities of the series to be redeemed specified in such
notice shall become due and payable on the date and at the place stated in such
notice at the applicable redemption price, together with interest accrued to the
date fixed for redemption and interest on such Debt Securities or portions of
Debt Securities shall cease to accrue on and after the date fixed for
redemption, unless the Company shall default in the payment of such redemption
price and accrued interest with respect to any such Debt Security or portion
thereof. On presentation and surrender of such Debt Securities on or after the
date fixed for redemption at the place of payment specified in the notice, said
Debt Securities shall be paid and redeemed at the applicable redemption price
for such series, together with interest accrued thereon to the date fixed for
redemption (but if the date fixed for redemption is an interest payment date,
the interest installment payable on such date shall be payable to the registered
holder at the close of business on the applicable record date pursuant to
Section 2.03).
(b) Upon presentation of any Debt Security of such series that is to
be redeemed in part only, the Company shall execute and the Trustee shall
authenticate and the office or agency where the Debt Security is presented shall
deliver to the holder thereof, at the expense of the Company, a new Debt
Security or Debt Securities of the same series, of authorized denominations in
principal amount equal to the unredeemed portion of the Debt Security so
presented.
SECTION 3.04. Sinkinq Fund. The provisions of Sections 3.04, 3.05
and 3.06 shall be applicable to any sinking fund for the retirement of Debt
Securities of a series, except as otherwise
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specified as contemplated by Section 2.01 for Debt Securities of such series.
The minimum amount of any sinking fund payment provided for by the
terms of Debt 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 Debt Securities of any series is herein referred to as an
"optional sinking fund payment". If provided for by the terms of Debt
Securities of any series, the cash amount of any sinking fund payment may be
subject to reduction as provided in Section 3.05. Each sinking fund payment
shall be applied to the redemption of Debt Securities of any series as provided
for by the terms of Debt Securities of such series.
SECTION 3.05. Satisfaction of Sinking Fund Payments with Debt
Securities. The Company (i) may deliver Outstanding Debt Securities of a series
(other than any Debt Securities previously called for redemption) and (ii) may
apply as a credit Debt Securities of a series that have been redeemed either at
the election of the Company pursuant to the terms of such Debt Securities or
through the application of permitted optional sinking fund payments pursuant to
the terms of such Debt Securities, in each case in satisfaction of all or any
part of any sinking fund payment with respect to the Debt Securities of such
series required to be made pursuant to the terms of such Debt Securities as
provided for by the terms of such series, provided that such Debt Securities
have not been previously so credited. Such Debt Securities shall be received
and credited for such purpose by the Trustee at the redemption price specified
in such Debt Securities for redemption through operation of the sinking fund and
the amount of such sinking fund payment shall be reduced accordingly.
SECTION 3.06. Redemption of Debt Securities for Sinkinq Fund. Not
less than 45 days prior to each sinking fund payment date for any series of Debt
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 the series, the portion thereof, if any, that is to be
satisfied by delivering and crediting Debt Securities of that series pursuant to
Section 3.05 and the basis for such credit and will, together with such
Officers' Certificate, deliver to the Trustee any Debt Securities to be so
delivered. Not less than 30 days before each such sinking fund payment date,
the Trustee shall select the Debt Securities to be redeemed upon such sinking
fund payment date in the manner specified in Section 3.02 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 Section 3.02. Such notice having been duly
given, the redemption of such Debt Securities shall be made upon the terms and
in the manner stated in Section 3.03.
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ARTICLE IV
COVENANTS OF THE COMPANY
SECTION 4.01. Payment of Principal, Premium and Interest. The
Company will duly and punctually pay or cause to be paid the principal of (and
premium, if any) and interest on the Debt Securities of that series at the time
and place and in the manner provided herein and established with respect to
such Debt Securities.
SECTION 4.02. Maintenance of Office or Agency. So long as any
series of the Debt Securities remain Outstanding, the Company agrees to
maintain an office or agency in the Borough of Manhattan, the City and State of
New York, with respect to each such series and at such other location or
locations as may be designated as provided in this Section 4.02, where (i) Debt
Securities of that series may be presented for payment, (ii) Debt Securities of
that series may be presented as hereinabove authorized for registration of
transfer and exchange, and (iii) notices and demands to or upon the Company in
respect of the Debt Securities of that series and this Indenture may be given
or served, such designation to continue with respect to such office or agency
until the Company shall, by written notice signed by its President or a Vice
President and delivered to the trustee, designate some other office or agency
for such purposes or any of them. 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, notices and demands may
be made or served at the Corporate Trust Office of the Trustee, and the Company
hereby appoints the Trustee as its agent to receive all such presentations,
notices and demands.
SECTION 4.03. Paying Agents. (a) If the Company shall appoint one
or more paying agents for all or any series of the Debt Securities, other than
the Trustee, the Company will cause each such paying agent to execute and
deliver to the Trustee an instrument in which such agent shall agree with the
Trustee, subject to the provisions of this Section:
(1) that it will hold all sums held by it as such agent for the
payment of the principal of (and premium, if any) or interest on the Debt
Securities of that series (whether such sums have been paid to it by the
Company or by any other obligor of such Debt Securities) in trust for the
benefit of the Persons entitled thereto;
(2) that it will give the Trustee notice of any failure by the
Company to make any payment of the principal of (and premium, if any) or
interest on the Debt Securities of that series when the same shall be due
and payable;
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(3) that it will, at any time during the continuance of any failure
referred to in the preceding paragraph (a)(2) above, upon the written
request of the Trustee, forthwith pay to the Trustee all sums so held in
trust by such paying agent; and
(4) that it will perform all other duties of paying agent as set
forth in this Indenture.
(b) If the Company shall act as its own paying agent with respect to
any series of the Debt Securities, it will on or before each due date of the
principal of (and premium, if any) or interest on Debt Securities of that
series, set aside, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay such principal (and premium, if any) or
interest so becoming due on Debt Securities of that series until such sums shall
be paid to such Persons or otherwise disposed of as herein provided and will
promptly notify the Trustee of such action, or any failure by it to take such
action. Whenever the Company shall have one or more paying agents for any
series of Debt Securities, it will, prior to each due date of the principal of
(and premium, if any) or interest on any Debt Securities of that series, deposit
with the paying agent a sum 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
this action or failure so to act.
(c) Notwithstanding anything in this Section to the contrary, (i) the
agreement to hold sums in trust as provided in this Section is subject to the
provisions of Section 11.05, and (ii) 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 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 terms and conditions as those upon which such 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 money.
SECTION 4.04. Appointment to Fill Vacancy in Office of Trustee. The
Company, whenever necessary to avoid or fill a vacancy in the office of Trustee,
will appoint, in the manner provided in Section 7.10, a Trustee, so that there
shall at all times be a Trustee hereunder.
SECTION 4.05. Compliance with Consolidation Provisions. The Company
will not, while any of the Debt Securities remain Outstanding, consolidate with,
or merge into, or merge into itself, or sell or convey all or substantially all
of its property to any
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other company unless the provisions of Article X hereof are complied with.
SECTION 4.06. Limitation on Dividends; Transactions with Affiliates.
(a) If Debt Securities are issued to a ComEd Trust or a trustee of such trust
in connection with the issuance of Trust Securities by such ComEd 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 to its payment or any
obligations under the Preferred Securities Guarantee or Common Securities
Guarantee relating to such Trust Securities, then (x) the Company shall not
declare or pay any dividend on, make any distributions with respect to, or
redeem, purchase or make a liquidation payment with respect to, any of its
capital stock, (y) the Company shall not make any payment of interest, principal
or premium, if any, on or repay, repurchase or redeem any debt securities
(including guarantees) issued by the Company which rank pari passu with or
junior to such Debt Securities and (z) the Company shall not make guarantee
payments with respect to the foregoing (other than pursuant to the Preferred
Securities Guarantee).
(b) If Debt Securities are issued to a ComEd Trust or a trustee of
such trust in connection with the issuance of Trust Securities by such ComEd
Trust and the Company shall have given notice of its election to defer payments
of interest on such Debt Securities by extending the interest payment period as
provided in any indenture supplemental hereto and such period, or any extension
thereof, shall be continuing, then (i) the Company shall not declare or pay any
dividend, or make any distributions with respect to, or redeem, purchase or make
a liquidation payment with respect to, any of its capital stock, (ii) the
Company shall not make any payment of interest, principal or premium, if any, on
or repay, repurchase or redeem any debt securities (including guarantees) issued
by the Company which rank pari passu with or junior to such Debt Securities and
(iii) the Company shall not make any guarantee payments with respect to the
foregoing (other than pursuant to the Preferred Securities Guarantee).
SECTION 4.07. Covenants as to ComEd Trust. In the event Debt
Securities are issued and sold to a ComEd Trust in connection with the issuance
of Trust Securities by such 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 trust; provided, however, that any permitted
successor of the Company under the Indenture may succeed to the Company's
ownership of the Common Securities, (ii) not cause, as sponsor of such trust, or
permit, as holder of Common Securities of such trust, the dissolution, winding-
up or termination of such trust, except in connection with a distribution of
Debt Securities as provided in the Declaration and in connection with certain
mergers, consolidations or amalgamations permitted by the Declaration and (iii)
use its reasonable efforts to cause such trust (a) to remain
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a business trust, except in connection with a distribution of Debt Securities,
the redemption of all of the Trust Securities of such ComEd Trust or certain
mergers, consolidations or amalgamations, each as permitted by the Declaration
of such ComEd Trust, and (b) to otherwise continue to be classified for United
States federal income tax purposes as a grantor trust.
SECTION 4.08. Corporate Existence The Company will, subject to the
provisions of Article X, at all times maintain its corporate existence and right
to carry on business and will duly procure all renewals and extensions thereof,
and, to the extent necessary or desirable in the operation of its business, will
use its best efforts to maintain, preserve and renew all of its rights, powers,
privileges and franchises.
ARTICLE V
SECURITYHOLDERS, LISTS AND REPORTS
BY THE COMPANY AND THE TRUSTEE
SECTION 5.01. Company to Furnish Trustee Names and Addresses of
Securityholders. The Company will furnish or cause to be furnished to the
Trustee (a) on a quarterly basis on each regular record date (as defined in
Section 2.03) a list, in such form as the Trustee may reasonably require, of the
names and addresses of the holders of each series of Debt Securities as of such
regular record date, provided that the Company shall not be obligated to furnish
or cause to furnish such list at any time that the list shall not differ in any
respect from the most recent list furnished to the Trustee by the Company and
(b) at such other times as the Trustee may request in writing within 30 days
after the receipt by the Company of any such request, a list of similar form and
content as of a date not more than 15 days prior to the time such list is
furnished; provided, however, that in either case, no such list need be
furnished for any series for which the Trustee shall be the Security Registrar.
SECTION 5.02. Preservation Of Information; Communications With
Securityholders. (a) The Trustee shall preserve, in as current a form as is
reasonably practicable, all information as to the names and addresses of the
holders of Debt Securities contained in the most recent list furnished to it as
provided in Section 5.01 and as to the names and addresses of holders of Debt
Securities received by the Trustee in its capacity as Security Registrar (if
acting in such capacity).
(b) The Trustee may destroy any list furnished to it as provided in
Section 5.01 upon receipt of a new list so furnished.
(c) Securityholders may communicate as provided in Section 312(b) of
the Trust Indenture Act with other Securityholders with respect to their rights
under this Indenture or under the Debt Securities.
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SECTION 5.03. Reports By the Company. (a) The Company covenants
and agrees to 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) that the Company may be required to file with the
Commission pursuant to Section 13 or Section 15(d) of the Exchange Act; or, if
the Company is not required to file information, documents or reports pursuant
to either of such sections, then to file with the Trustee and the Commission, in
accordance with the rules and regulations prescribed from time to time by the
Commission, such of the supplementary and periodic information, documents and
reports that may be required pursuant to Section 13 of the Exchange Act, in
respect of a security listed and registered on a national securities exchange as
may be prescribed from time to time in such rules and regulations.
(b) The Company covenants and agrees to file with the Trustee and the
Commission, in accordance with the rules and regulations prescribed from to time
by the Commission, such additional information, documents and reports with
respect to compliance by the Company with the conditions and covenants provided
for in this Indenture as may be required from time to time by such rules and
regulations.
(c) The Company covenants and agrees to transmit by mail, first class
postage prepaid, or reputable overnight delivery service that provides for
evidence of receipt, to the Securityholders, as their names and addresses appear
upon the Security Register, within 30 days after the filing thereof with the
Trustee, such summaries of any information, documents and reports required to be
filed by the Company pursuant to subsections (a) and (b) of this Section as may
be required by rules and regulations prescribed from time to time by the
Commission.
SECTION 5.04. Reports by the Trustee. (a) On or before July 15 in
each year in which any of the Debt Securities are Outstanding, the Trustee shall
transmit by mail, first class postage prepaid, to the Securityholders, as their
names and addresses appear upon the Security Register, a brief report dated as
of the preceding May 15, if and to the extent required under Section 313(a) of
the Trust Indenture Act.
(b) The Trustee shall comply with Sections 313(b) and 313(c) of the
Trust Indenture Act.
(c) A copy of each such report shall, at the time of such
transmission to Securityholders, be filed by the Trustee with the Company, with
each stock exchange upon which any Debt Securities are listed (if so listed) and
also with the Commission. The Company agrees to notify the Trustee when any
Debt Securities become listed on any stock exchange.
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ARTICLE VI
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 6.01. Events of Default. (a) Whenever used herein with
respect to Debt Securities of a particular series, "Event of Default" means any
one or more of the following events that has occurred and is continuing:
(1) the Company defaults in the payment of any installment of
interest upon any of the Debt Securities of that series, as and when the
same shall become due and payable, and continuance of such default for a
period of 30 days; provided, however, that a valid extension of an interest
payment period by the Company in accordance with the terms of any indenture
supplemental hereto, shall not constitute a default in the payment of
interest for this purpose;
(2) the Company defaults in the payment of the principal of (or
premium, if any, on) any of the Debt Securities of that series as and when
the same shall become due and payable whether at maturity, upon redemption,
by declaration or otherwise, or in any payment required by any sinking or
analogous fund established with respect to that series; provided, however,
that a valid extension of the maturity of such Debt Securities in
accordance with the terms of any indenture supplemental hereto shall not
constitute a default in the payment of principal or premium, if any;
(3) the Company fails to observe or perform any other of its
covenants or agreements with respect to that series contained in this
Indenture or otherwise established with respect to that series of Debt
Securities pursuant to Section 2.01 hereof (other than a covenant or
agreement that has been expressly included in this Indenture solely for the
benefit of one or more series of Debt Securities other than such series)
for a period of 90 days after the date on which written notice of such
failure, requiring the same to be remedied and stating that such notice is
a "Notice of Default" hereunder, shall have been given to the Company by
the Trustee, by registered or certified mail, or to the Company and the
Trustee by the holders of at least 25% in principal amount of the Debt
Securities of that series at the time Outstanding;
(4) the Company pursuant to or within the meaning of any Bankruptcy
Law (i) commences a voluntary case, (ii) consents to the entry of an order
for relief against it in an involuntary case, (iii) consents to the
appointment of a Custodian of it or for all or substantially all of its
property or (iv) makes a general assignment for the benefit of its
creditors;
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(5) a court of competent jurisdiction enters an order under any
Bankruptcy Law that (i) is for relief against the Company in an involuntary
case, (ii) appoints a Custodian of the Company for all or substantially all
of its property, or (iii) orders the liquidation of the Company, and the
order or decree remains unstayed and in effect for 90 days; or
(6) in the event Debt Securities are issued and sold to a ComEd Trust
or other trust of the Company in connection with the issuance of Trust
Securities by such trust, such trust shall have voluntarily or
involuntarily dissolved, wound-up its business or otherwise terminated its
existence except in connection with (i) the distribution of Debt Securities
to holders of Trust Securities in liquidation of their interests in such
trust, (ii) the redemption of all outstanding Trust Securities of such
trust, and (iii) mergers, consolidations or amalgamations, each as
permitted by the Declaration of such trust.
(b) If an Event of Default described in clauses 1, 2, 3 or 6 of this
Section 6.01 with respect to Debt Securities of any series at the time
outstanding occurs and is continuing, unless the principal of all the Debt
Securities of that series shall have already become due and payable, either the
Trustee or the holders of not less than 25% in aggregate principal amount of the
Debt Securities of that series then Outstanding hereunder, by notice in writing
to the Company (and to the Trustee, if given by such Securityholders), may
declare the principal of all the Debt Securities of that series to be due and
payable immediately, and upon any such declaration the same shall become and
shall be immediately due and payable, notwithstanding anything contained in this
Indenture or in the Debt Securities of that series or established with respect
to that series pursuant to Section 2.01 to the contrary. If an Event of Default
specified in clause (4) or (5) of this Section 6.01 occurs or is continuing,
then the principal amount of all the Debt 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 Securityholder.
(c) At any time after the principal of the Securities of that series
shall have been so declared due and payable, and before any judgment or decree
for the payment of the moneys due shall have been obtained or entered as
hereinafter provided, the holders of a majority in aggregate principal amount of
the Securities of that series then Outstanding hereunder, by written notice to
the Company and the Trustee, may rescind and annul such declaration and its
consequences if: (i) the Company has paid or deposited with the Trustee a sum
sufficient to pay all matured installments of interest upon all the Securities
of that series and the principal of (and premium, if any, on) any and all
Securities of that series that shall have become due otherwise than by
acceleration (with interest upon such principal and premium, if any, and, to the
extent that such payment is enforceable under applicable law, upon
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overdue installments of interest, at the rate per annum expressed in the
Securities of that series to the date of such payment or deposit) and the amount
payable to the Trustee under Section 7.06, and (ii) any and all Events of
Default under the Indenture with respect to such series, other than the
nonpayment of principal on Securities of that series that shall not have become
due by their terms, shall have been remedied or waived as provided in Section
6.06.
No such rescission and annulment shall extend to or shall affect any
subsequent default or impair any right consequent thereon.
(d) In case the Trustee shall have proceeded to enforce any right
with respect to Securities of that series under this Indenture and such
proceedings shall have been discontinued or abandoned because of such rescission
or annulment or for any other reason or shall have been determined adversely to
the Trustee, then and in every such case the Company and the Trustee shall be
restored respectively to their former positions and rights hereunder, and all
rights, remedies and powers of the Company and the Trustee shall continue as
though no such proceedings had been taken.
SECTION 6.02. Collection of Indebtedness and Suits for Enforcement by
Trustee.
(a) The Company covenants that (1) in case it shall default in the
payment of any installment of interest on any of the Securities of a series, or
any payment required by any sinking or analogous fund established with respect
to that series as and when the same shall have become due and payable, and such
default shall have continued for a period of 90 days, or (2) in case it shall
default in the payment of the principal of (or premium, if any, on) any of the
Securities of a series when the same shall have become due and payable, whether
upon maturity of the Securities of a series or upon redemption or upon
declaration or otherwise, then, upon demand of the Trustee, the Company will pay
to the Trustee, for the benefit of the holders of the Securities of that series,
the whole amount that then shall have become due and payable on all such
Securities for principal (and premium, if any) or interest, or both, as the case
may be, with interest upon the overdue principal (and premium, if any) and (to
the extent that payment of such interest is enforceable under applicable law
and, if the Securities are held by a ComEd Trust, without duplication of any
other amounts paid by such trust in respect thereof) upon overdue installments
of interest at the rate per annum expressed in the Securities of that series;
and, in addition thereto, such further amount as shall be sufficient to cover
the costs and expenses of collection and the amount payable to the Trustee under
Section 7.06.
(b) If the Company shall fail to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as
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trustee of an express trust, shall be entitled and empowered to institute any
action or proceedings at law or in equity for the collection of the sums so due
and unpaid, and may prosecute any such action or proceeding to judgment or final
decree, and may enforce any such judgment or final decree against the Company or
other obligor upon the Securities of that series and collect the moneys adjudged
or decreed to be payable in the manner provided by law out of the property of
the Company or other obligor upon the Securities of that series, wherever
situated.
(c) In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, readjustment, arrangement, composition or judicial proceedings
affecting the Company or its creditors or property, the Trustee shall have power
to intervene in such proceedings and take any action therein that may be
permitted by the court and shall (except as may be otherwise provided by law) be
entitled to file such proofs of claim and other papers and documents as may be
necessary or advisable in order to have the claims of the Trustee and of the
holders of Securities of such series allowed for the entire amount due and
payable by the Company under the Indenture at the date of institution of such
proceedings and for any additional amount that may become due and payable by the
Company after such date, and to collect and receive any moneys or other property
payable or deliverable on any such claim, and to distribute the same after the
deduction of the amount payable to the Trustee under Section 7.06; and any
receiver, assignee or trustee in bankruptcy or reorganization is hereby
authorized by each of the holders of Securities of such series to make such
payments to the Trustee, and, in the event that the Trustee shall consent to the
making of such payments directly to such Securityholders, to pay to the Trustee
any amount due it under Section 7.06.
(d) All rights of action and of asserting claims under this
Indenture, or under any of the terms established with respect to Securities of
that series, may be enforced by the Trustee without the possession of any of
such Securities, or the production thereof at any trial or other proceeding
relative thereto, and any such suit or proceeding instituted by the Trustee
shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for payment to the Trustee of any
amounts due under Section 7.06, be for the ratable benefit of the holders of the
Securities of such series.
In case of an Event of Default hereunder, the Trustee may in its
discretion proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any of such rights, either at law or in
equity or in bankruptcy or otherwise, whether for the specific enforcement of
any covenant or agreement contained in the Indenture or in aid of the exercise
of any power granted in this Indenture, or to enforce any other legal
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or equitable right vested in the Trustee by this Indenture or by law.
Nothing contained herein shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Securityholder any
plan of reorganization, arrangement, adjustment or composition affecting the
Securities of that series or the rights of any holder thereof or to authorize
the Trustee to vote in respect of the claim of any Securityholder in any such
proceeding.
SECTION 6.03. Application of Moneys Collected. Any moneys collected
by the Trustee pursuant to this Article with respect to a particular series of
Securities shall be applied in the following order, at the date or dates fixed
by the Trustee and, in case of the distribution of such moneys on account of
principal (or premium, if any) or interest, upon presentation of the Securities
of that series, and notation thereon of the payment, if only partially paid, and
upon surrender thereof if fully paid:
FIRST: To the payment of costs and expenses of collection and of all
amounts payable to the Trustee under Section 7.06;
SECOND: To the payment of all Senior Indebtedness of the Company if
and to the extent required by Article XIV; and
THIRD: To the payment of the amounts then due and unpaid upon
Securities of such series for principal (and premium, if any) and interest,
in respect of which or for the benefit of which such money has been
collected, ratably, without preference or priority of any kind, according
to the amounts due and payable on such Securities for principal (and
premium, if any) and interest, respectively.
SECTION 6.04. Limitation on Suits. No holder of any Security of any
series shall have any right by virtue or by availing of any provision of this
Indenture to institute any suit, action or proceeding in equity or at law upon
or under or with respect to this Indenture or for the appointment of a receiver
or trustee, or for any other remedy hereunder, unless (i) such holder previously
shall have given to the Trustee written notice of an Event of Default and of the
continuance thereof with respect to the Securities of such series specifying
such Event of Default, as hereinbefore provided; (ii) the holders of not less
than 25% in aggregate principal amount of the Securities of such series then
Outstanding shall have made written request upon the Trustee to institute such
action, suit or proceeding in its own name as trustee hereunder; (iii) such
holder or holders shall have offered to the Trustee such reasonable indemnity as
it may require against the costs, expenses and liabilities to be incurred
therein or thereby; and (iv) the Trustee for 60 days after its receipt of such
notice, request and offer of indemnity, shall have failed to
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institute any such action, suit or proceeding; and (v) during such 60 day
period, the holders of a majority in principal amount of the Securities of that
series do not give the Trustee a direction inconsistent with the request.
Notwithstanding anything contained herein to the contrary, any other
provisions of this Indenture, the right of any holder of any Security to
receive payment of the principal of (and premium, if any) and interest on such
Security, as therein provided, on or after the respective due dates expressed
in such Security (or in the case of redemption, on the redemption date), or to
institute suit for the enforcement of any such payment on or after such
respective dates or redemption date, shall not be impaired or affected without
the consent of such holder, and by accepting a Security hereunder it is
expressly understood, intended and covenanted by the taker and holder of every
Security of such series with every other such taker and holder and the Trustee,
that no one or more holders of Securities of such series shall have any right
in any manner whatsoever by virtue or by availing of any provision of this
Indenture to affect, disturb or prejudice the rights of the holders of any
other of such Securities, or to obtain or seek to obtain priority over or
preference to any other such holder, or to enforce any right under this
Indenture, except in the manner herein provided and for the equal, ratable and
common benefit of all holders of Securities of series. For the protection and
enforcement of the provisions of this Section, each and every Securityholder
and the Trustee shall be entitled to such relief as can be given either at law
or in equity.
SECTION 6.05. Rights and Remedies Cumulative; Delay or Omission Not
Waiver. (a) Except as otherwise provided in Section 2.07, all powers and
remedies given by this Article to the Trustee or to the Securityholders shall,
to the extent permitted by law, be deemed cumulative and not exclusive of any
other powers and remedies available to the Trustee or the holders of the
Securities, by judicial proceedings or otherwise, to enforce the performance or
observance of the covenants and agreements contained in this Indenture or
otherwise established with respect to such Securities.
(b) No delay or omission of the Trustee or of any holder of any of
the Securities to exercise any right or power accruing upon any Event of
Default occurring and continuing as aforesaid shall impair any such right or
power, or shall be construed to be a waiver of any such default or an
acquiescence therein; and, subject to the provisions of Section 6.04, every
power and remedy given by this Article or by law to the Trustee or the
Securityholders may be exercised from time to time, and as often as shall be
deemed expedient, by the Trustee or by the Securityholders.
SECTION 6.06. Control by Securityholders. The holders of a majority
in aggregate principal amount of the Securities of any series at the time
Outstanding, determined in accordance with
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Section 8.04, shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee with respect to such
series; provided, however, that such direction shall not be in conflict with
any rule of law or with this Indenture or be unduly prejudicial to the rights
of holders of Securities of any other series at the time Outstanding determined
in accordance with Section 8.04. Subject to the provisions of Section 7.01, the
Trustee shall have the right to decline to follow any such direction if the
Trustee in good faith shall, by a Responsible Officer or Officers of the
Trustee, determine that the proceeding so directed would involve the Trustee in
personal liability. The holders of a majority in aggregate principal amount of
the Securities of any series at the time Outstanding affected thereby,
determined in accordance with Section 8.04, may on behalf of the holders of all
of the Securities of such series waive any past default in the performance of
any of the covenants contained herein or established pursuant to Section 2.01
with respect to such series and its consequences, except (i) a default in the
payment of the principal of, or premium, if any, or interest on, any of the
Securities of that series as and when the same shall become due by the terms of
such Securities otherwise than by acceleration (unless such default has been
cured and a sum sufficient to pay all matured installments of interest and
principal and any premium has been deposited with the Trustee (in accordance
with Section 6.01(c)) or (ii) a default in the covenants contained in Section
4.06(b). Upon any such waiver, the default covered thereby shall deemed to be
cured for all purposes of this Indenture and the Company, the Trustee and the
holders of the Securities of such series shall be restored to their former
positions and rights hereunder, respectively; but no such waiver shall extend
to any subsequent or other default or impair any right consequent thereon.
SECTION 6.07. Undertaking to Pay Costs. All parties to this
Indenture agree, and each holder of any Securities by such holder's acceptance
thereof shall be deemed to have agreed, that any court may in its discretion
require, in any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken or omitted
by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Securityholder, or group of
Securityholders, holding more than 10% in aggregate principal amount of the
Outstanding Securities of any series, or to any suit instituted by any
Securityholder for the enforcement of the payment of the principal of (or
premium, if any) or interest on any Security of such series, on or after the
respective due dates expressed in such Security or established pursuant to this
Indenture.
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ARTICLE VII
CONCERNING THE TRUSTEE
SECTION 7.01. Certain Duties and Responsibilities of Trustee. (a)
The Trustee, prior to the occurrence of an Event of Default with respect to the
Debt Securities of a series and after the curing of all Events of Default with
respect to the Debt Securities of that series that may have occurred, shall
undertake to perform with respect to the Debt Securities of such series such
duties and only such duties as are specifically set forth in this Indenture, and
no implied covenants shall be read into this Indenture against the Trustee. In
case an Event of Default with respect to the Securities of a series has occurred
(that has not been cured or waived), the Trustee shall exercise with respect to
Debt Securities of that series such of the rights and powers vested in it by
this Indenture, and use the same degree of care and skill in their exercise, as
a prudent man would exercise or use under the circumstances in the conduct of
his own affairs.
(b) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that:
(1) prior to the occurrence of an Event of Default with respect to
the Debt Securities of a series and after the curing or waiving of all such
Events of Default with respect to that series that may have occurred:
(i) the duties and obligations of the Trustee shall with respect to
the Debt Securities of such series be determined solely by the express
provisions of this Indenture, and the Trustee shall not be liable with
respect to the Debt Securities of such series except for the performance of
such duties and obligations as are specifically set forth in this
Indenture, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(ii) in the absence of bad faith on the part of the Trustee, the
Trustee may with respect to the Debt Securities of such series 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
Trustee and conforming to the requirements of this Indenture; but in the
case of any such certificates or opinions that by any provision hereof are
specifically required to be furnished to the Trustee, the Trustee shall be
under a duty to examine the same to determine whether or not they conform
to the requirement of this Indenture;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer or Responsible
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Officers of the Trustee, unless it shall be proved that the Trustee, was
negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction of
the holders of not less than a majority in principal amount of the Debt
Securities of any series at the time Outstanding relating to the time, method
and place of conducting any proceeding for any remedy available to the Trustee,
or exercising any trust or power conferred upon the Trustee under this Indenture
with respect to the Debt Securities of that series; and
(4) None of the provisions contained in this Indenture shall require
the Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the exercise
of any of its rights or powers, if there is reasonable ground for believing that
the repayment of such funds or liability is not reasonably assured to it under
the terms of this Indenture or adequate indemnity against such risk is not
reasonably assured to it.
SECTION 7.02. Certain Rights of Trustee. Except as otherwise
provided in Section 7.01:
(a) The Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond, security or
other paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) Any request, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by a Board Resolution or an instrument
signed in the name of the Company by the President, or any Vice President and by
the Secretary or an Assistant Secretary or the Treasurer or an Assistant
Treasurer thereof (unless other evidence in respect thereof is specifically
prescribed herein);
(c) 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 or suffered or omitted hereunder
in good faith and in reliance thereon;
(d) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Securityholders, pursuant to the provisions of this
Indenture, unless such Securityholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that may be incurred therein or thereby; nothing contained herein shall,
however,
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relieve the Trustee of the obligation, upon the occurrence of an Event of
Default with respect to a series of the Debt Securities (that has not been cured
or waived) to exercise with respect to Debt Securities of that series such of
the rights and powers vested in it by this Indenture, and to use the same degree
of care and skill in their exercise, as a prudent man would exercise or use
under the circumstances in the conduct of his own affairs;
(e) The Trustee shall not be liable for any action taken or omitted
to be taken 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;
(f) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond, security, or
other papers or documents, unless requested in writing so to do by the holders
of not less than a majority in principal amount of the Outstanding Debt
Securities of the particular series affected thereby (determined as provided in
Section 8.04); provided, however, that if the payment within a reasonable time
to the Trustee of the costs, expenses or liabilities likely to be incurred by it
in the making of such investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to it by the terms of
this Indenture, the Trustee may require reasonable indemnity against such costs,
expenses or liabilities as a condition to so proceeding. The reasonable expense
of every such examination shall be paid by the Company or, if paid by the
Trustee, shall be repaid by the Company upon demand;
(g) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder;
(h) 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; and
(i) 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 7.03. Trustee Not Responsible for Recitals or Issuance of
Debt Securities. (a) The recitals contained herein
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and in the Debt Securities shall be taken as the statements of the Company, and
the Trustee assumes no responsibility for the correctness of the same.
(b) The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Debt Securities.
(c) The Trustee shall not be accountable for the use or application
by the Company of any of the Debt Securities or of the proceeds of such Debt
Securities, or for the use or application of any moneys paid over by the
Trustee in accordance with any provision of this Indenture or established
pursuant to Section 2.01, or for the use or application of any moneys received
by any paying agent other than the Trustee.
SECTION 7.04. May Hold Debt Securities. The Trustee or any paying
agent or Security Registrar, in its individual or any other capacity, may become
the owner or pledgee of Debt Securities with the same rights it would have if it
were not Trustee, paying agent or Security Registrar.
SECTION 7.05. Moneys Held in Trust. Subject to the provisions of
Section 11.05, all moneys received by the Trustee shall, until used or applied
as herein provided, be held in trust for the purposes for which they were
received, but 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
moneys received by it hereunder except such as it may agree with the Company to
pay thereon.
SECTION 7.06. Compensation and Reimbursement. (a) The Company
covenants and agrees to pay to the Trustee, and the Trustee shall be entitled
to, such reasonable compensation (which shall not be limited by any provision of
law in regard to the compensation of a trustee of an express trust), as the
Company and the Trustee may from time to time agree in writing, for all services
rendered by it in the execution of the trusts hereby created and in the exercise
and performance of any of the powers and duties hereunder of the Trustee, and,
except as otherwise expressly provided herein, the Company will pay or reimburse
the Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any of the
provisions of this Indenture (including the reasonable compensation and the
expenses and disbursements of its counsel and of all Persons not regularly in
its employ) except any such expense, disbursement or advance as may arise from
its negligence or bad faith. The Company also covenants to indemnify the
Trustee (and its officers, agents, directors and employees) for, and to hold it
harmless against, any loss, liability or expense incurred without negligence or
bad faith on the part of the Trustee and arising out of or in connection with
the acceptance or administration of this trust, including the costs
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and expenses of defending itself against any claim of liability in the premises.
(b) The obligations of the Company under this Section to compensate
and indemnify the Trustee and to pay or reimburse the Trustee for expenses,
disbursements and advances shall constitute additional indebtedness hereunder
and shall survive the satisfaction and discharge of this Indenture. Such
additional indebtedness shall be secured by a lien prior to that of the Debt
Securities upon all property and funds held or collected by the Trustee as such,
except funds held in trust for the benefit of the holders of particular Debt
Securities.
SECTION 7.07. Reliance on Officers' Certificate. Except as otherwise
provided in Section 7.01, whenever in the administration of the provisions of
this Indenture the Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking or suffering or omitting to take any
action hereunder, such matter (unless other evidence in respect thereof be
herein specifically prescribed) may, in the absence of negligence or bad faith
on the part of the Trustee, be deemed to be conclusively proved and established
by an Officers' Certificate delivered to the Trustee and such certificate, in
the absence of negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken, suffered or omitted to be taken by
it under the provisions of this Indenture upon the faith thereof.
SECTION 7.08. Qualification; Conflicting Interests. If the Trustee
has or shall acquire any "conflicting interest" within the meaning of Section
310(b) of the Trust Indenture Act, the Trustee and the Company shall in all
respects comply with the provisions of Section 310(b) of the Trust Indenture
Act.
SECTION 7.09. Corporate Trustee Required; Eligibility. There shall
at all times be a Trustee with respect to the Debt Securities issued hereunder
which shall at all times be a corporation organized and doing business under the
laws of the United States of America or any State or Territory thereof or of the
District of Columbia, or a corporation or other Person permitted to act as
trustee by the Commission, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least fifty million
U.S. dollars ($50,000,000), and subject to supervision or examination by
Federal, State, Territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of the aforesaid supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. The Company may not, nor
may any Person directly or indirectly controlling, controlled by, or under
common control with the Company, serve as Trustee. In case at any
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time the Trustee shall cease to be eligible in accordance with the provisions of
this Section, the Trustee shall resign immediately in the manner and with the
effect specified in Section 7.10.
SECTION 7.10. Resignation and Removal; Appointment of Successor. (a)
The Trustee or any successor hereafter appointed, may at any time resign with
respect to the Debt Securities of one or more series by giving written notice
thereof to the Company and the Guarantor and by transmitting notice of
resignation by mail, first class postage prepaid, to the Securityholders of such
series, as their names and addresses appear upon the Security Register. Upon
receiving such notice of resignation, the Company shall promptly appoint a
successor trustee with respect to Debt Securities of such series by written
instrument, in duplicate, executed by order of the Board of Directors, one copy
of which instrument shall be delivered to the resigning Trustee and one copy to
the successor trustee. If no successor trustee shall have been so appointed and
have accepted appointment within 30 days after the mailing 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 Debt
Securities of such series, or any Securityholder of that series who has been a
bona fide holder of a Debt Security or Debt Securities for at least six months
may, subject to the provisions of Section 6.08, on behalf of himself and all
others similarly situated, petition any such court for the appointment of a
successor trustee. Such court may thereupon after such notice, if any, as it
may deem proper and prescribe, appoint a successor trustee.
(b) In case at any time any one of the following shall occur:
(1) the Trustee shall fail to comply with the provisions of
subsection (a) of Section 7.08 after written request therefor by the
Company or by any Securityholder who has been a bona fide holder of a Debt
Security or Debt Securities for at least six months; or
(2) the Trustee shall cease to be eligible in accordance with the
provisions of Section 7.09 and shall fail to resign after written request
therefor by the Company or by any such Securityholder; or
(3) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or commence a voluntary bankruptcy
proceeding, or a receiver of the Trustee or of its property shall be
appointed or consented to, or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, then, in any such case, the
Company may remove the Trustee with respect to all Debt Securities and
appoint a successor trustee by written instrument, in duplicate, executed
by order of the Board of
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Directors, one copy of which instrument shall be delivered to the Trustee
so removed and one copy to the successor trustee, or, subject to the
provisions of Section 6.08, unless the Trustee's duty to resign is stayed
as provided herein, any Securityholder who has been a bona fide holder of a
Debt Security or Debt Securities for at least six months may, on behalf of
that holder and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment
of a successor trustee. Such court may thereupon after such notice, if
any, as it may deem proper and prescribe, remove the Trustee and appoint a
successor trustee.
(c) The holders of a majority in aggregate principal amount of the
Debt Securities of any series at the time Outstanding may at any time remove the
Trustee with respect to such series by so notifying the Trustee and the Company
and may appoint a successor Trustee for such series with the consent of the
Company.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee with respect to the Debt Securities of a series pursuant to
any of the provisions of this Section shall become effective upon acceptance of
appointment by the successor trustee as provided in Section 7.11.
(e) Any successor trustee appointed pursuant to this Section may be
appointed with respect to the Debt Securities of one or more series or all of
such series, and at any time there shall be only one Trustee with respect to
the Debt Securities of any particular series.
SECTION 7.11. Acceptance of Appointment By Successor. (a) In case
of the appointment hereunder of a successor trustee with respect to all Debt
Securities, every such successor 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
successor trustee, such retiring Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor trustee all the
rights, powers, and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor trustee all property and money held by
such retiring Trustee hereunder.
(b) In case of the appointment hereunder of a successor trustee with
respect to the Debt Securities of one or more (but not all) series, the Company,
the retiring Trustee and each successor trustee with respect to the Debt
Securities of one or more series shall execute and deliver an indenture
supplemental hereto wherein
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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 Debt Securities of that or those
series to which the appointment of such successor trustee relates, (2) 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 Debt Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same trust, 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 that no Trustee shall be responsible for any act or
failure to act on the part of any other Trustee hereunder; 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,
such retiring Trustee shall with respect to the Debt Securities of that or those
series to which the appointment of such successor trustee relates have no
further responsibility for the exercise of rights and powers or for the
performance of the duties and obligations vested in the Trustee under this
Indenture, 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 Debt 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, to the extent
contemplated by such supplemental indenture, the property and money held by such
retiring Trustee hereunder with respect to the Debt Securities of that or those
series to which the appointment of such successor trustee relates.
(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 such 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.
(e) Upon acceptance of appointment by a successor trustee as provided
in this Section, the Company shall transmit notice of the succession of such
trustee hereunder by mail, first class postage prepaid, to the Securityholders,
as their names and
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addresses appear upon the Security Register. If the Company fails to transmit
such notice within ten days after acceptance of appointment by the successor
trustee, the successor trustee shall cause such notice to be transmitted at the
expense of the Company.
SECTION 7.12. 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 the corporate trust business of the Trustee, shall be
the successor of the Trustee hereunder, provided that such corporation shall be
qualified under the provisions of Section 7.08 and eligible under the provisions
of Section 7.09, without the execution or filing of any paper or any further act
on the part of any of the parties hereto, anything herein to the contrary
notwithstanding. In case any Debt Securities shall have been authenticated, but
not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Debt Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Debt
Securities.
SECTION 7.13. Preferential Collection of Claims Against the Company.
The Trustee shall comply with Section 311(a) of the Trust Indenture Act,
excluding any creditor relationship described in Section 311(b) of the Trust
Indenture Act. A Trustee who has resigned or been removed shall be subject to
Section 311(a) of the Trust Indenture Act to the extent included therein.
ARTICLE VIII
CONCERNING THE SECURITYHOLDERS
SECTION 8.01. Evidence of Action by Securityholders. Whenever in
this Indenture it is provided that the holders of a majority or specified
percentage in aggregate principal amount of the Debt Securities of a particular
series may take any action (including the making of any demand or request, the
giving of any notice, consent or waiver or the taking of any other action), the
fact that at the time of taking any such action the holders of such majority or
specified percentage of that series have joined therein may be evidenced by any
instrument or any number of instruments of similar tenor executed by such
holders of Debt Securities of that series in Person or by agent or proxy
appointed in writing.
If the Company shall solicit from the Securityholders of any series
any request, demand, authorization, direction, notice, consent, waiver or other
action, the Company may, at its option, as evidenced by an Officers'
Certificate, fix in advance a record date for such series for the determination
of Securityholders (entitled to give such request, demand, authorization,
direction, notice,
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consent, waiver or other action, but the Company shall have no obligation to do
so. If such a record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other action may be given before or after
the record date, but only the Securityholders of record at the close of business
on the record date shall be deemed to be Securityholders for the purposes of
determining whether Securityholders of the requisite proportion of Outstanding
Debt Securities of that series have authorized or agreed or consented to such
request, demand, authorization, direction, notice, consent, waiver or other
action, and for that purpose the Outstanding Debt Securities of that series
shall be computed as of the record date; provided, however, that no such
authorization, agreement or consent by such Securityholders on the record date
shall be deemed effective unless it shall become effective pursuant to the
provisions of this Indenture not later than six months after the record date.
SECTION 8.02. Proof of Execution by Securityholders. Subject to the
provisions of Section 7.01, proof of the execution of any instrument by a
Securityholder (such proof will not require notarization) or his agent or proxy
and proof of the holding by any Person of any of the Debt Securities shall be
sufficient if made in the following manner:
(a) The fact and date of the execution by any such Person of any
instrument may be proved in any reasonable manner acceptable to the
Trustee.
(b) The ownership of Debt Securities shall be proved by the Debt
Security Register of such Debt Securities or by a certificate of the Debt
Security Registrar thereof.
(c) The Trustee may require such additional proof of any matter
referred to in this Section as it shall deem necessary.
SECTION 8.03. Who May be Deemed Owners. Prior to the due presentment
for registration of transfer of any Debt Security, the Company, the Trustee, any
paying agent and any Debt Security Registrar may deem and treat the Person in
whose name such Debt Security shall be registered upon the books of the Company
as the absolute owner of such Debt Security (whether or not such Debt Security
shall be overdue and notwithstanding any notice of ownership or writing thereon
made by anyone other than the Debt Security Registrar) for the purpose of
receiving payment of or on account of the principal of, premium, if any, and
(subject to Section 2.03) interest on such Debt Security and for all other
purposes; and neither the Company nor Guarantor nor the Trustee nor any paying
agent nor any Debt Security Registrar shall be affected by any notice to the
contrary.
SECTION 8.04. Certain Debt Securities Owned by Company Disregarded.
In determining whether the holders of the requisite aggregate principal amount
of Debt Securities of a particular
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series have concurred in any direction, consent waiver under this Indenture,
the Debt Securities of that series that are owned by the Company or any other
obligor on the Debt Securities of that series or by any Person directly or
indirectly controlling or controlled by or under common control with the
Company or any other obligor on the Debt Securities of that series shall be
disregarded and deemed not to be outstanding for the purpose of any such
determination, except that for the purpose of determining whether the Trustee
shall be protected in relying on any such direction, consent or waiver, only
Debt Securities of such series that the Trustee actually knows are so owned
shall be so disregarded. The Debt Securities so owned that have been pledged
in good faith may be regarded as outstanding for the purposes of this Section,
if the pledgee shall establish to the satisfaction of the Trustee the pledgee's
right so to act with respect to such Debt Securities and that the pledgee is
not a Person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Company or the Guarantor or any such
other obligor. In case of a dispute as to such right, any decision by the
Trustee taken upon the advice of counsel shall be full protection to the
Trustee.
SECTION 8.05. Actions Binding on Future Securityholders. At any
time prior to (but not after) the evidencing to the Trustee, as provided in
Section 8.01, of the taking of any action by the holders of a majority or
specified percentage in aggregate principal amount of the Debt Securities of a
particular series in connection with such action, any holder of a Debt Security
of that series that is shown by the evidence to be included in the Debt
Securities the holders of which have consented to such action may, by filing
written notice with the Trustee, and upon proof of holding as provided in
Section 8.02, revoke such action so far as concerns such Debt Security. Except
as aforesaid, any such action taken by the holder of any Debt Security shall be
conclusive and binding upon such holder and upon all future holders and owners
of such Debt Security, and of any Debt Security issued in exchange therefor, on
registration of transfer thereof or in place thereof, irrespective of whether
or not any notation in regard thereto is made upon such Debt Security. Any
action taken by the holders of a majority or specified percentage in aggregate
principal amount of the Debt Securities of a particular series in connection
with such action shall be conclusively binding upon the Company, the Trustee
and the holders of all the Debt Securities of that series.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.01. Supplemental Indentures Without the Consent of
Securityholders. In addition to any supplemental indenture otherwise authorized
by this Indenture, the Company and the Guarantor and the Trustee may from time
to time and at any time enter into an indenture or indentures supplemental
hereto (which
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shall conform to the provisions of the Trust Indenture Act as then in effect),
without the consent of the Securityholders, for one or more of the following
purposes:
(a) to cure any ambiguity, defect or inconsistency herein or in the
Debt Securities of any series;
(b) to comply with Article X;
(c) to provide for uncertificated Debt Securities in addition to or
in place of certificated Debt Securities;
(d) to add to the covenants of the Company for the benefit of the
holders of all or any series of Debt Securities (and if such covenants are
to be for the benefit of less than all series of Debt Securities, stating
that such covenants are expressly being included solely for the benefit of
such series) or to surrender any right or power herein conferred upon the
Company;
(e) to add to, delete from, or revise the conditions, limitations and
restrictions on the authorized amount, terms or purposes of issue,
authentication and delivery of Debt Securities, as herein set forth;
(f) to make any change that does not adversely affect the rights of
any Securityholder in any material respect; or
(g) to provide for the issuance of and establish the form and terms
and conditions of the Debt Securities of any series as provided in Section
2.01, to establish the form of any certifications required to be furnished
pursuant to the terms of this Indenture or any series of Debt Securities,
or to add to the rights of the holders of any series of Debt Securities.
The Trustee is hereby authorized to join with the Company in the
execution of any such supplemental indenture, and to make any further
appropriate agreements and stipulations that may be therein contained, but the
Trustee shall not be obligated to enter into any such supplemental indenture
that affects the Trustee's own rights, duties or immunities under this Indenture
or otherwise.
Any supplemental indenture authorized by the provisions of this
Section may be executed by the Company and the Trustee without the consent of
the holders of any of the Debt Securities at the time Outstanding
notwithstanding any of the provisions of Section 9.02.
SECTION 9.02. Supplemental Indentures With Consent of
Securityholders. With the consent (evidenced as provided in Section 8.01) of
the holders of not less than a majority in aggregate principal amount of the
Debt Securities of each series
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affected by such supplemental indenture or indentures at the time Outstanding,
the Company, when authorized by a Board Resolution, and the Trustee may from
time to time and at any time enter into an indenture or indentures supplemental
hereto (which shall conform to the provisions of the Trust Indenture Act as then
in effect) for the purpose of adding any provisions to or changing in any manner
or eliminating any of the provisions of this Indenture or of any supplemental
indenture or of modifying in any manner not covered by Section 9.01 the rights
of the holders of the Debt Securities of such series under this Indenture;
provided, however, that no such supplemental indenture shall, without the
consent of the holders of each Debt Security then Outstanding and affected
thereby, (i) extend the fixed maturity of any Debt Securities 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 Debt Security so affected or
(ii) reduce the aforesaid percentage of Debt Securities, the holders of which
are required to consent to any such supplemental indenture.
It shall not be necessary for the consent of the Securityholders of
any series affected thereby under this Section to approve the particular form of
any proposed supplemental indenture, but it shall be sufficient if such consent
shall approve the substance thereof.
SECTION 9.03. Effect of Supplemental Indentures. Upon the execution
of any supplemental indenture pursuant to the provisions of this Article or of
Section 10.01, this Indenture shall, with respect to such series, be and be
deemed to be modified and amended in accordance therewith and the respective
rights, limitations of rights, obligations, duties and immunities under this
Indenture of the Trustee, the Company and the holders of Debt Securities of the
series affected thereby shall thereafter be determined, exercised and enforced
hereunder subject in all respects to such modifications and amendments, and all
the terms and conditions of any such supplemental indenture shall be and be
deemed to be part of the terms and conditions of this Indenture for any and all
purposes.
SECTION 9.04. Debt Securities Affected by Supplemental Indentures.
Debt Securities of any series, affected by a supplemental indenture,
authenticated and delivered after the execution of such supplemental indenture
pursuant to the provisions of this Article or of Section 10.01, may bear a
notation in form approved by the Company, provided such form meets the
requirements of any exchange upon which such series may be listed, as to any
matter provided for in such supplemental indenture. If the Company shall so
determine, new Debt Securities of that series so modified as to conform, in the
opinion of the Board of Directors of the Company, to any modification of this
Indenture contained in any, such supplemental indenture may be prepared by the
Company,
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authenticated by the Trustee and delivered in exchange for the Debt Securities
of that series then outstanding.
SECTION 9.05. Execution of Supplemental Indentures. Upon the request
of the Company, accompanied by a Board Resolution authorizing the execution of
any such supplemental indenture, and upon the filing with the Trustee of
evidence of the consent of Securityholders required to consent thereto as
aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise, in which
case the Trustee may in its discretion but shall not be obligated to enter into
such supplemental indenture. The Trustee, subject to the provisions of Section
7.01, may receive an Opinion of Counsel as conclusive evidence that any
supplemental indenture executed pursuant to this Article is authorized or
permitted by, and conforms to, the terms of this Article and that it is proper
for the Trustee under the provisions of this Article to join in the execution
thereof.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the Trustee
shall transmit by mail, first class postage prepaid, a notice, setting forth in
general terms the substance of such supplemental indenture, to the
Securityholders of all series affected thereby as their names and addresses
appear upon the Debt Security Register. Any failure of the Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.
ARTICLE X
SUCCESSOR CORPORATION
SECTION 10.01. Company May Consolidate, Etc. Nothing contained in
this Indenture or in any of the Debt Securities shall prevent any consolidation
or merger of the Company with or into any other corporation or corporations
(whether or not affiliated with the Company), or successive consolidations or
mergers in which the Company or its successor or successors shall be a party or
parties, or shall prevent any sale, conveyance, transfer or other disposition of
the property of the Company or its successor or successors as an entirety, or
substantially as an entirety, to any other corporation (whether or not
affiliated with the Company or the Guarantor, as the case may be, or its
successor or successors) authorized to acquire and operate the same; provided,
however, the Company hereby covenants and agrees that, upon any such
consolidation, merger, sale, conveyance, transfer or other disposition, the due
and punctual payment of the principal of (premium, if any) and interest on all
of the Debt Securities of all series in accordance with the terms of each
series, according to their tenor and the due and punctual performance and
observance of
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all the covenants and conditions of this Indenture with respect to each series
or established with respect to such series pursuant to Section 2.01 to be kept
or performed by the Company, shall be expressly assumed, by supplemental
indenture (which shall conform to the provisions of the Trust Indenture Act, as
then in effect) satisfactory in form to the Trustee executed and delivered to
the Trustee by the entity formed by such consolidation, or into which the
Company shall have been merged, or by the entity which shall have acquired such
property.
SECTION 10.02. Successor Corporation Substituted. (a) In case of
any such consolidation, merger, sale, conveyance, transfer or other disposition
and upon the assumption by the successor corporation, by supplemental indenture,
executed and delivered to the Trustee and satisfactory in form to the Trustee,
of the due and punctual payment of the principal of, premium, if any, and
interest on all of the Debt Securities of all series Outstanding and the due and
punctual performance of all of the covenants and conditions of this Indenture or
established with respect to each series of the Debt Securities pursuant to
Section 2.01 to be performed by the Company, with respect to each series, such
successor corporation shall succeed to and be substituted for the Company, with
the same effect as if it had been named as the Company herein.
(b) In case of any such consolidation, merger, sale, conveyance,
transfer or other disposition, such changes in phraseology and form (but not in
substance) may be made in the Debt Securities thereafter to be issued as may be
appropriate.
(c) Nothing contained in this Indenture or in any of the Debt
Securities shall prevent the Company from merging into itself or acquiring by
purchase or otherwise all or any part of the property of any other Person
(whether or not affiliated with the Company).
SECTION 10.03. Evidence of Consolidation, Etc. to Trustee. The
Trustee, subject to the provisions of Section 7.01, may receive an Opinion of
Counsel as conclusive evidence that any such consolidation, merger, sale,
conveyance, transfer or other disposition, and any such assumption, comply with
the provisions of this Article.
ARTICLE XI
SATISFACTION AND DISCHARGE
SECTION 11.01. Satisfaction and Discharge of Indenture. If at any
time: (a) the Company shall have delivered to the Trustee for cancellation all
Debt Securities of a series theretofore authenticated (other than any Debt
Securities that shall have been destroyed, lost or stolen and that shall have
been replaced or paid as provided in Section 2.07) and Debt Securities for whose
payment
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money or Governmental Obligations have theretofore been deposited in trust or
segregated and held in trust by the Company or the Guarantor (and thereupon
repaid to the Company or discharged from such trust, as provided in Section
11.05); or (b) all such Debt Securities of a particular series not theretofore
delivered to the Trustee for cancellation shall have become due and payable, or
are by their terms to become due and payable within one year or are to be called
for redemption within one year under arrangements satisfactory to the Trustee
for the giving of notice of redemption, and the Company shall deposit or cause
to be deposited with the Trustee as trust funds the entire amount in moneys or
Governmental Obligations or a combination 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 at maturity or
upon redemption all Debt Securities of that series not theretofore delivered to
the Trustee for cancellation, including principal (and premium, if any) and
interest due or to become due to such date of maturity or date fixed for
redemption, as the case may be, and if the Company shall also pay or cause to be
paid all other sums payable hereunder with respect to such series by the
Company; then if the Company has delivered to the Trustee an Opinion of Counsel
based on the fact that (x) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling or (y) since the date
hereof, there has been a change in the applicable United States federal income
tax law, in either case to the effect that, and such opinion shall confirm that,
the holders of the Debt Securities of such series will not recognize income,
gain or loss for United States federal income tax purposes as a result of such
deposit, defeasance and discharge and will be subject to United States federal
income tax on the same amount and in the same manner and at the same times, as
would have been the case if such deposit, defeasance and discharge had not
occurred, this Indenture shall thereupon cease to be of further effect with
respect to such series except for the provisions of Sections 2.03, 2.05, 2.07,
4.01, 4.02, 4.03 and 7.10, that shall survive until the date of maturity or
redemption date, as the case may be, and Sections 7.06 and 11.05, that shall
survive to such date and thereafter, and the Trustee, on demand of the Company
and at the cost and expense of the Company shall execute proper instruments
acknowledging satisfaction of and discharging this Indenture with respect to
such series.
SECTION 11.02. Discharge of Obligations. If at any time all Debt
Securities of a particular series not heretofore delivered to the Trustee for
cancellation or that have not become due and payable as described in Section
11.01 shall have been paid by the Company by depositing irrevocably with the
Trustee as trust funds moneys or an amount of Governmental Obligations
sufficient to pay at maturity or upon redemption all such Debt Securities of
that series not theretofore delivered to the Trustee for cancellation, including
principal (and premium, if any) and interest due or to become due to such date
of maturity or date fixed for redemption, as the case may be, and if the Company
shall also pay or cause to
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be paid all other sums payable hereunder by the Company with respect to such
series, then after the date such moneys or Governmental Obligations, as the case
may be, are deposited with the Trustee then, if the Company has delivered to the
Trustee an Opinion of Counsel based on the fact that (x) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (y) since the date hereof, there has been a change in the applicable
United States federal income tax law, in either case to the effect that, and
such opinion shall confirm that, the holders of the Debt Securities of such
series will not recognize income, gain or loss for United States federal income
tax purposes as a result of such deposit, defeasance and discharge and will be
subject to United States federal income tax on the same amount and in the same
manner and at the same times, as would have been the case if such deposit,
defeasance and discharge had not occurred, the obligations of the Company, under
this Indenture with respect to such series shall cease to be of further effect
except for the provisions of Sections 2.03, 2.05, 2.07, 4.01, 4.02, 4.03, 7.06,
7.10 and 11.05 hereof that shall survive until such Debt Securities shall mature
and be paid. Thereafter, Sections 7.06 and 11.05 shall survive.
SECTION 11.03. Deposited Moneys to be Held in Trust. All moneys or
Governmental Obligations deposited with the Trustee pursuant to Sections 3.11 or
11.02 shall be held in trust and shall be available for payment as due, either
directly or through any paying agent (including the Company acting as its own
paying agent), to the holders of the particular series of Debt Securities for
the payment or redemption of which such moneys or Governmental Obligations have
been deposited with the Trustee.
SECTION 11.04. Payment of Moneys Held by Paying Agents. In
connection with the satisfaction and discharge of this Indenture, all moneys or
Governmental Obligations then held by any paying agent under the provisions of
this Indenture shall, upon demand of the Company, be paid to the Trustee and
thereupon such paying agent shall be released from all further liability with
respect to such moneys or Governmental Obligations.
SECTION 11.05. Repayment to Company. Any moneys or Governmental
Obligations deposited with any paying agent or the Trustee, or then held by the
Company, in trust for payment of principal of or premium or interest on the Debt
Securities of a particular series that are not applied but remain unclaimed by
the holders of such Debt Securities for at least two years after the date upon
which the principal of (and premium, if any) or interest on such Debt Securities
shall have respectively become due and payable, shall be repaid to the Company
on May 31 of each year or (if then held by the Company) shall be discharged from
such trust; and thereupon the paying agent and the Trustee shall be released
from all further liability with respect to such moneys or Governmental
Obligations, and the holder of any of the Debt Securities entitled to receive
such payment shall thereafter, as an
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unsecured general creditor, look only to the Company for the payment thereof.
ARTICLE XII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS
AND DIRECTORS
SECTION 12.01. No Recourse. No recourse under or upon any
obligation, covenant or agreement of this Indenture, or of any Debt Security, or
for any claim based thereon or otherwise in respect thereof, shall be had
against any incorporator, stockholder, officer or director, past, present or
future as such, of the Company or of any predecessor or successor corporation,
either directly or through the Company or any such 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; it being expressly
understood that this Indenture and the obligations issued hereunder are solely
corporate obligations, and that no such personal liability whatever shall attach
to, or is or shall be incurred by, the incorporators, stockholders, officers or
directors as such, of the Company or of any predecessor or successor
corporation, or any of them, because of the creation of the indebtedness hereby
authorized, or under or by reason of the obligations, covenants or agreements
contained in this Indenture or in any of the Debt Securities or implied
therefrom; and that any and all such personal liability of every name and
nature, either at common law or in equity or by constitution or statute, of, and
any and all such rights and claims against, every such incorporator,
stockholder, officer or director as such, because of the creation of the
indebtedness hereby authorized, or under or by reason of the obligations,
covenants or agreements contained in this Indenture or in any of the Debt
Securities or implied therefrom, are hereby expressly waived and released as a
condition of, and as a consideration for, the execution of this Indenture and
the issuance of such Debt Securities.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.01. Effect on Successors and Assigns. All the covenants,
stipulations, promises and agreements in this Indenture contained by or on
behalf of the Company shall bind successors and assigns, whether so expressed or
not.
SECTION 13.02. Actions by Successor. Any act or proceeding by any
provision of this Indenture authorized or required to be done or performed by
any board, committee or officer of the Company or the Guarantor shall and may be
done and performed with like force and effect by the corresponding board,
committee or
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officer of any corporation that shall at the time be the lawful successor of the
Company.
SECTION 13.03. Surrender of Company Powers. The Company by
instrument in writing executed by authority of 2/3 (two-thirds) of its Board of
Directors and delivered to the Trustee may surrender any of the powers reserved
to the Company, and thereupon such power so surrendered shall terminate both as
to the Company and as to any successor corporation.
SECTION 13.04. Notices. Except as otherwise expressly provided
herein, any notice or demand that by any provision of this Indenture is required
or permitted to be given or served by the Trustee or by the holders of Debt
Securities to or on the Company may be given or served by being deposited first
class postage prepaid in a post-office letterbox addressed (until another
address is filed in writing by the Company with the Trustee), as follows:
Commonwealth Edison Company, 10 South Dearborn Street--37th Floor, Chicago,
Illinois 60690-0767, Attention: Treasurer. Any notice, election, request or
demand by the Company or any Securityholder to or upon the Trustee shall be
deemed to have been sufficiently given or made, for all purposes, if given or
made in writing at the Corporate Trust Office of the Trustee.
SECTION 13.05. Governing Law. This Indenture and each Debt Security
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 13.06. Treatment of the Debt Securities as Debt. It is
intended that the Debt Securities will be treated as indebtedness and not as
equity for federal income tax purposes. The provisions of this Indenture shall
be interpreted to further this intention.
SECTION 13.07. Compliance Certificates and Opinions. (a) Upon any
application or demand by the Company to the Trustee to take any action under any
of the provisions of this Indenture, the Company shall furnish to the Trustee an
Officers' Certificate stating that all conditions precedent provided for in this
Indenture relating to the proposed action have been complied with and an Opinion
of Counsel stating that in the opinion of such counsel all such conditions
precedent have been complied with, except that in the case of any such
application or demand as to which the furnishing of such documents is
specifically required by any provision of this Indenture relating to such
particular application or demand, no additional certificate or opinion need be
furnished.
(b) Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
in this Indenture shall include (1) a statement that the Person making such
certificate or opinion has
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read such covenant or condition; (2) a brief statement as to the nature and
scope of the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based; (3) a statement that, in the
opinion of such Person, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether or not such
covenant or condition has been complied with; and (4) a statement as to whether
or not, in the opinion of such Person, such condition or covenant has been
complied with.
SECTION 13.08. Payments on Business Days. Except as provided
pursuant to Section 2.01 pursuant to a Board Resolution, and as set forth in an
Officers' Certificate, or established in one or more indentures supplemental to
this Indenture, in any case where the date of maturity of interest or principal
of any Debt Security or the date of redemption of any Debt Security shall not be
a Business Day, then payment of interest or principal (and premium, if any) may
be made on the next succeeding Business Day with the same force and effect as if
made on the nominal date of maturity or redemption, and no interest shall accrue
for the period after such nominal date.
SECTION 13.09. Conflict with Trust Indenture Act. If and to the
extent that any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by Sections 310 to 317, inclusive, of the Trust Indenture
Act, such imposed duties shall control.
SECTION 13.10. Counterparts. This 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.
SECTION 13.11. Separability. In case any one or more of the
provisions contained in this Indenture or in the Debt Securities of any series
shall for any reason be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provisions of this Indenture or of such Debt Securities, but this
Indenture and such Debt Securities shall be construed as if such invalid or
illegal or unenforceable provision had never been contained herein or therein.
SECTION 13.12. Assignment. The Company will have the right at all
times to assign any of its respective rights or obligations under this Indenture
to a direct or indirect wholly-owned Subsidiary of the Company, provided that,
in the event of any such assignment, the Company will remain liable for all such
obligations. Subject to the foregoing, the Indenture is binding upon and inures
to the benefit of the parties thereto and their respective successors and
assigns. This Indenture may not otherwise be assigned by the parties thereto.
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<PAGE>
SECTION 13.13. Acknowledgment of Rights. The Company acknowledges
that, with respect to any Debt Securities held by a ComEd Trust or a trustee of
such trust, if the Property Trustee of such Trust fails to enforce its rights
under this Indenture as the holder of the series of Debt Securities held as the
assets of such ComEd Trust, any holder of Preferred Securities may, after a
period of 30 days has elapsed from such holder's written request to such
Property Trustee to enforce such rights, institute legal proceedings directly
against the Company to enforce such Property Trustee's rights under this
Indenture without first instituting any legal proceedings against such Property
Trustee or any other person or entity.
ARTICLE XIV
SUBORDINATION OF DEBT SECURITIES
SECTION 14.01. Subordination Terms. The payment by the Company of
the principal of, premium, if any, and interest on any series of Debt Securities
issued hereunder shall be subordinated to the extent set forth in an indenture
supplemental hereto relating to such Debt Securities.
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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.
COMMONWEALTH EDISON COMPANY
By: __________________________
Name:
Title:
Attest:
By: _________________________
Name:
Title:
WILMINGTON TRUST COMPANY,
as Trustee
By: __________________________
Name:
Title:
Attest:
By: _________________________
Name:
Title:
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<PAGE>
STATE OF ILLINOIS)
COUNTY OF COOK ) SS
On the ___ day of ____________, 1995, before me personally came
___________________________ to me known, who, being by me duly sworn, did depose
and say that he is the _________________ of COMMONWEALTH EDISON COMPANY, one of
the corporations described in and which executed the above instrument; that he
knows the corporate seal of said corporation; that the seal affixed to the said
instrument is such corporate 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 me known, who, being by me duly sworn, did depose and say
that he is the _________________________ of WILMINGTON TRUST COMPANY, one of the
corporations described in and which executed the above instrument; that he knows
the corporate seal of said corporation; that the seal affixed to the said
instrument is such corporate 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:
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<PAGE>
Exhibit (4)-4
Commonwealth Edison Company
Form S-3
File No. 33-
THIS FIRST SUPPLEMENTAL INDENTURE, dated as of _________, 1995 (the
"First Supplemental Indenture"), between Commonwealth Edison Company, an
Illinois corporation (the "Company"), and Wilmington Trust Company, not in its
individual capacity but solely as trustee (the "Trustee") under the Indenture
dated as of ________, 1995 between the Company and the Trustee (the
"Indenture").
W I T N E S S E T H:
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; and
WHEREAS, pursuant to the terms of the Indenture, the Company desires
to provide for the establishment of a new series of its Debt Securities to be
known as its __% Subordinated Deferrable Interest Notes due _____ (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 Supplemental
Indenture; and
WHEREAS, ComEd Financing I, a Delaware statutory business trust (the
"Trust"), has offered to the public $ ____ million aggregate stated liquidation
amount of its Trust Originated Preferred Securities (the "Preferred Securities")
and has offered to the Company $_____ million aggregate stated liquidation
amount of its Trust Originated Common Securities (the "Common Securities"), such
Preferred Securities and Common Securities representing undivided beneficial
interests in the assets of the Trust, and proposes to invest the proceeds from
such offering in $ ____ million aggregate principal amount of the Notes; and
WHEREAS, the Company has requested the Trustee to 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
performed, and the execution and delivery of this First Supplemental Indenture
has been duly authorized in all respects;
<PAGE>
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 and (c) the following
terms have the meanings given to them in the Declaration: (i) Clearing Agency;
(ii) Delaware Trustee; (iii) Dissolution Tax Opinion; (iv) No Recognition
Opinion; (v) Preferred Security Certificate; (vi) Property Trustee; (vii) Pro
Rata; (viii) Regular Trustees; (ix) Special Event; and (x) Tax Event.
In addition, the following terms have the following respective meanings:
"Declaration" means the Amended and Restated Declaration of Trust of
ComEd Financing I, a Delaware business trust, dated as of ________, 1995.
"Dissolution Event" means that, as a result of the occurrence and
continuation of a Special 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 _________.
"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.
"Senior Indebtedness" means (i) any payment in respect of (A)
indebtedness of the Company for money borrowed and (B) indebtedness
evidenced by securities, debentures, bonds, notes or other similar
instruments issued by the Company including, without limitation,
indebtedness evidenced by securities issued pursuant to the provisions of
the Mortgage
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<PAGE>
dated July 1, 1923, as supplemented by Supplemental Indenture dated August
1, 1944 and subsequent supplemental indentures, between the Company, as
mortgagor, and Bank of America Illinois and Robert Donahue, as trustees;
the Indenture dated as of September 1, 1987, as supplemented and amended,
between the Company and Citibank, N.A., as trustee; the Indentures dated
April 1, 1949, October 1, 1949, October 1, 1950, October 1, 1954, January
1, 1958, January 1, 1959 and December 1, 1961, between the Company and
Harris Trust and Savings Bank, as successor trustee to The First National
Bank of Chicago; and the Indenture dated February 15, 1973, as
supplemented, between the Company and LaSalle National Bank, as successor
trustee to The First National Bank of Chicago; (ii) all capital lease
obligations of the Company; (iii) all obligations of the Company issued or
assumed as the deferred purchase price of property, all conditional sale
obligations of the Company 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 the Company for
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 the Company 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 the Company (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, including
all other debt securities and guarantees in respect of those debt
securities, issued to any other trusts, partnerships or any other entity
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 or other securities which rank pari passu with, or
junior to, the Preferred Securities, and (2) any indebtedness between or
among the Company and its Affiliates.
Section 1.2. Interpretation. Each definition in this First
Supplemental Indenture includes the singular and the plural, and references to
the neuter gender include the masculine and feminine where appropriate. Terms
which relate to accounting matters shall be interpreted in accordance with
generally accepted accounting principles in effect from time to time.
References to any statute mean such statute as amended at the time and include
any successor legislation. The word "or" is not exclusive, and the words
"herein," "hereof" and "hereunder" refer to this First Supplemental Indenture as
a whole. The headings to the Articles and Sections are for convenience of
reference and shall not affect the meaning or interpretation of this First
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Supplemental Indenture. References to Articles and Sections mean the Articles
and Sections of this First Supplemental Indenture.
ARTICLE II
GENERAL TERMS AND CONDITIONS OF
THE NOTES
Section 2.1. Designation and Principal Amount. There is hereby
authorized a series of Debt Securities designated the "__% Subordinated
Deferrable Interest Notes due ________," limited in aggregate principal amount
to $________ million, which amount shall be as set forth in any written order of
the Company for the authentication and delivery of Notes pursuant to Section
2.04 of the Indenture.
Section 2.2. Maturity. The Maturity Date will be _______________.
Section 2.3. Form and Payment. Except as provided in Section 2.4,
the Notes shall be issued in fully registered certificated form without 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 in ________, 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.
Notwithstanding the foregoing, so long as the registered holder of any Notes is
the Property Trustee, the payment of the principal of and interest (including
Compounded Interest and Additional Interest, 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. In connection with a Dissolution Event:
(a) the Notes in certificated form may be presented to the Trustee by
the Property Trustee in exchange for a Global Security in an aggregate
principal amount equal to the aggregate principal amount of the Notes so
presented, to be registered in the name of the Depositary, or its nominee,
and delivered by the Trustee to the Depositary for crediting to the
accounts of its participants pursuant to the instructions of the Regular
Trustees. The Company, upon any such presentation, shall execute a Global
Security in such aggregate principal amount and deliver the same to the
Trustee for authentication and delivery in accordance with the Indenture
and this First Supplemental Indenture.
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Payments on the Notes issued as a Global security will be made to the
Depositary; and
(b) 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 Certificate
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 aggregate
principal amount equal to the aggregate stated liquidation amount of the
Non Book-Entry Preferred Securities until such Preferred Security
Certificates are presented to the Security Registrar for transfer or
reissuance at which time such Preferred 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 Certificate, as the case may be, with an aggregate principal
amount equal to the aggregate stated 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 principal amount that were
presented by the Property Trustee to the Trustee will be deemed to have
been cancelled.
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 IV) quarterly in
arrears on [March 31, June 30, September 30 and December 31] of each year (each,
an "Interest Payment 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 shall
be the close of business on the Business Day next preceding that Interest
Payment Date. If pursuant to the provisions of Section 2.11(c) of the Indenture
the Notes are no longer represented by a Global Security, the Company may select
a regular record date for such interest installment which shall be any date at
least fifteen days 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. In the event that any date
on which interest is payable on the Notes is not a Business Day, then payment of
interest
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payable on such date will be made on the next succeeding day which is a Business
Day (and without any interest or other payment in respect of any such delay),
except that, if such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date. The amount of interest
payable for any period shorter than a full quarterly period for which interest
is computed, will be computed on the basis of the actual number of days elapsed
in such a 90-day quarter.
(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 additional 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 rendering the Dissolution Tax
Opinion that a No Recognition 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 registered 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") at a redemption price equal to 100% of the principal amount to be
redeemed plus any accrued and unpaid interest thereon to the date of such
redemption (the "Special Redemption Price"), 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 ("Ministerial Action"),
such as filing a form or making an election, or pursuing some other similar
reasonable measure that
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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 Declaration. The Special 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 and specifies in the notice of
redemption, provided the Company shall deposit with the Trustee an amount
sufficient to pay the Special Redemption Price by 11:00 a.m. on the date such
Special Redemption Price is to be paid.
Section 3.2. Optional Redemption by Company. (a) Subject to the
provisions of Article III of the Indenture and to Section 3.2(b), 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 redeemed 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 days'
nor more than 60 days' notice to the registered 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 Security, the Depositary shall determine by lot
the principal amount of such Notes held by each Noteholder 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
and specifies in the notice of redemption, provided the Company shall deposit
with the Trustee an amount sufficient to pay the Optional Redemption Price by
11:00 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 and from time to
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time during the term of the Notes, to extend the interest payment period of such
Notes for up to twenty (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 compounded quarterly at the
Coupon Rate 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 Compounded Interest and Additional Interest ("Deferred Interest") which
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 twenty (20) consecutive quarters or extend beyond the maturity of the
Notes. Upon the termination of any Extended Interest Payment Period and upon
the payment of all Deferred Interest then due, the Company may select a new
Extended Interest Payment Period, subject to the foregoing requirements. No
interest shall be due and payable during an Extended Interest Payment Period,
except at the end thereof.
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 both
the Regular Trustees and the Property Trustee of its selection of such Extended
Interest Payment Period one Business Day before the earlier of (i) the next
succeeding date on which Distributions on the Trust Securities issued by the
Trust are payable, or (ii) the date the Trust is required to give notice of the
record or payment date for such Distributions 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 Interest 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 ten (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, but in any event at least
two Business Days before such record date.
(c) The quarter in which any notice is given pursuant to paragraphs
(a) or (b) of this Section 4.2 shall be counted as
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one of the twenty 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 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 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 operation 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 expenses 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 withholding 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 provisions of this Article VI; 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.
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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 subject in right of payment to the
prior payment in full of all Senior Indebtedness of the Company, whether
outstanding at the date of this First Supplemental Indenture or thereafter
incurred.
No provision of this Article VI 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, or in the event that the maturity of any Senior Indebtedness of the
Company has been accelerated because of a default, then, in either case, no
payment shall be made by the Company with respect to the principal (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 or any holder 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 Indebtedness (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 securities, to which the holders of the Notes or
the Trustee would be entitled to receive from the Company, except for the
provisions of this Article VI, shall be paid by the Company or by
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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 representative or representatives, or to the
trustee or trustees under any indenture pursuant to which any instruments
evidencing such Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay 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 distribution 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 or the holders of the Notes 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, as their respective
interests may appear, as calculated by the Company, for application to the
payment of all Senior Indebtedness of the Company 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 benefit of the holders of such Senior Indebtedness.
For purposes of this Article VI, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided in this Article VI with respect
to the Notes to the payment of all Senior Indebtedness of the Company that may
at the time be outstanding, provided that (i) such Senior Indebtedness is
assumed by the new corporation, if any, resulting from any such reorganization
or readjustment, and (ii) the rights of the holders of such Senior Indebtedness
are not, without the consent of such holders, altered by such reorganization or
readjustment. The consolidation of the Company with, or the merger of the
Company into, another 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
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corporation upon the terms and conditions provided for in Article X 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 consolidation, merger, conveyance or transfer, comply
with the conditions stated in Article X 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 7.06 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 Indebtedness to
receive payments or distributions of cash, property or securities of the Company
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 for 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
VI, and no payment over pursuant to the provisions of this Article VI, to or for
the benefit of the holders of such Senior Indebtedness by holders of the Notes
or the Trustee, shall, as between the Company, its creditors other than holders
of Senior Indebtedness of the Company, and the holders of the Notes be deemed to
be a payment by the Company to or on account of such Senior Indebtedness. It is
understood that the provisions of this Article VI 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 VI or elsewhere in this Indenture 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, other
than the holders of Senior Indebtedness of the Company, 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 VI of the holders
of such Senior Indebtedness in respect of cash, property or securities of the
Company, received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to
in this Article VI, the Trustee, subject to
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the provisions of Section 7.01 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 Indebtedness and other indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this Article
VI.
Section 6.5. Trustee to Effectuate Subordination. Each holder of a
Note 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 VI 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 VI.
Notwithstanding the provisions of this Article VI or any other provision of the
Indenture and this First Supplemental Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts that would prohibit the
making of any payment of monies to or by the Trustee in respect of the Notes
pursuant to the provisions of this Article VI unless and until a Responsible
Officer of the Trustee shall have received written notice thereof at the
Principal Office of the Trustee 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 7.01 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 payment of the principal of (or premium, if
any) or interest on any Note), then, anything herein contained to the contrary
notwithstanding, 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 7.01 of the
Indenture, shall be entitled to rely on the delivery to it
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of a written notice by a Person representing himself to be a holder of Senior
Indebtedness of the Company (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 VI, the Trustee may request
such Person to furnish evidence to the reasonable satisfaction of the Trustee as
to the amount of such Senior Indebtedness held by such Person, the extent to
which such Person is entitled to participate in such payment or distribution and
any other facts pertinent to the rights of such Person under this Article VI,
and if such evidence is not furnished, the Trustee may defer any payment to such
Person pending judicial determination as to the right of such Person to receive
such payment.
Section 6.7. Rights of the Trustee; Holders of Senior Indebtedness.
The Trustee in its individual capacity shall be entitled to all the rights set
forth in this Article VI 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 Indenture 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 VI, and no implied
covenants or obligations 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 provisions of Section 7.01 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 VI or otherwise.
Section 6.8. Subordination May Not Be Impaired. No right of any
present or future holder of any Senior Indebtedness 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 or by any act
or failure to act, in good faith, by any such holder, or by any noncompliance by
the Company with the terms, provisions and covenants of the 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
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consent of or notice to the Trustee or the holders of the Notes, without
incurring responsibility to the holders of the Notes and without impairing or
releasing the subordination provided in this Article VI 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 Indebtedness; (iii) release any Person liable in any manner for the
collection of such Senior Indebtedness; and (iv) exercise or refrain from
exercising any rights against the Company and any other Person.
ARTICLE VII
COVENANT TO LIST ON EXCHANGE
Section 7.1. Listing on Exchange. If the Notes are to be issued as a
Global Security in connection with the distribution of the Notes to the holders
of the Preferred Securities issued by the Trust upon a Dissolution Event, the
Company will use its best efforts to list such Notes on the New York Stock
Exchange or on such other exchange as the Preferred Securities 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 SECURITY, INSERT: This Note is a
Global Security 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,
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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 authorized representative of The
Depository Trust Company and any payment hereon is made to Cede & Co., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.]
No. $
CUSIP No.
COMMONWEALTH EDISON COMPANY
___% SUBORDINATED DEFERRABLE INTEREST NOTE
DUE ____
COMMONWEALTH EDISON COMPANY, an Illinois 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 ____________,
____ (or on such later date before ___________, _____ if the Company elects to
extend the maturity date as further described herein), and to pay interest on
said principal sum from ___________, ____ 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 compounded quarterly at the same rate per annum. The amount of
interest payable on any Interest Payment Date shall be computed on the basis of
a 360-day year of twelve 30-day months. 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 which is a Business
Day (and without any interest or other payment in respect of any such delay),
except that, if such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date. The interest
installment so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in the Indenture, be paid to the person
in whose name this Note (or one or more Predecessor Securities, as defined in
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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 Section 2.11(C) OF THE INDENTURE THE NOTES ARE NO LONGER
REPRESENTED BY A GLOBAL SECURITY -- which shall be the close of business on the
________ day 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 Securities) is
registered at the close of business on a special record date to be fixed by the
Trustee for the payment of such defaulted interest, notice whereof shall be
given to the registered holders of this series of Notes not less than ten (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 ________, in any
coin or currency of the United States of America which at the time of payment is
legal tender for payment of public and private debts; provided, however, that
payment of interest may be made at the option of the Company by check mailed to
the registered holder at such address as shall appear in the Security Register.
Notwithstanding 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 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 attorney-in-fact for any and all such
purposes. Each Holder hereof, by his acceptance hereof, hereby waives all
notice of the acceptance of the subordination provisions contained herein and in
the Indenture by each holder of Senior Indebtedness, whether now outstanding or
hereafter incurred, and waives reliance by each such Holder upon said
provisions.
This Note shall not be entitled to any benefit under the Indenture
hereinafter referred to, be valid or become obligatory for any purpose until the
Certificate of
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Authentication hereon shall have been signed by or on behalf of the Trustee.
Unless the Certificate of Authentication hereon has been executed by
the Trustee referred to on the reverse side hereof, this 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.
IN WITNESS WHEREOF, the Company has caused this instrument to be
executed.
Dated
COMMONWEALTH EDISON COMPANY
By
[Title]
Attest:
By
Secretary
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(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.
WILMINGTON TRUST COMPANY, _____________________
Not in Its Individual as Authentication Agent
Capacity But Solely
as Trustee
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 Wilmington Trust Company, not in its individual capacity but solely as
trustee (the "Trustee"), as supplemented by the First Supplemental 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 which may vary as to amount, date of
maturity, rate of interest and in other respects as in the Indenture provided.
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 redemption 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 Redemption"), 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 optional redemption pursuant
to this paragraph will be made upon
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not less than 30 days' 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 Security, the Depositary 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 indenture 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
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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 for
up to twenty (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 twenty (20) consecutive quarters or extend beyond the
maturity of the Notes. 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 select 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 Trustee in ________
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 purposes, and neither the Company
nor the Trustee
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<PAGE>
nor any paying agent nor any Security 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 Notes of this series are issuable only in registered form without
coupons in denominations of $25 and any integral multiple thereof.] [This Global
Security 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 which 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 11.1. Ratification of Indenture. The Indenture, as
supplemented by this First Supplemental Indenture, 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.
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<PAGE>
Section 11.2. 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 11.3. 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 11.4. 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 this First
Supplemental Indenture and the Notes shall be construed as if such invalid or
illegal or unenforceable provision had never been contained herein or therein.
Section 11.5. 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.
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<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.
COMMONWEALTH EDISON COMPANY
By
[Title]
[Corporate Seal]
Attest:
Secretary
WILMINGTON TRUST COMPANY,
Not in Its Individual Capacity
But Solely as Trustee
By:
[Title]
[Corporate Seal]
Attest:
[Title]
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<PAGE>
STATE OF ILLINOIS )
COUNTY OF COOK ) ss:
On the day of , 1995, before me personally came ____________,
to me known, who, being by me duly sworn, did depose and say that he is the
____________________ of COMMONWEALTH EDISON COMPANY, one of the corporations
described in and which executed the above instrument; that he knows the
corporate seal of said corporation; that the seal affixed to the said instrument
is such corporate 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 __________):
On the day of , 1995, before me personally came ____________,
to me known, who, being by me duly sworn, did depose and say that he is the
____________________ of WILMINGTON TRUST COMPANY, one of the corporations
described in and which executed the above instrument; that he knows the
corporate seal of said corporation; that the seal affixed to the said instrument
is such corporate 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
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<PAGE>
Exhibit (4)-7
Commonwealth Edison Company
Form S-3
File No. 33-
====================================
PREFERRED SECURITIES GUARANTEE AGREEMENT
ComEd Financing I
Dated as of ________, 1995
====================================
<PAGE>
PREFERRED SECURITIES GUARANTEE AGREEMENT
THIS PREFERRED SECURITIES GUARANTEE AGREEMENT (this "Guarantee Agreement"),
dated as of ________, 1995, is executed and delivered by COMMONWEALTH EDISON
COMPANY, an Illinois corporation (the "Guarantor"), and Wilmington Trust
Company, a Delaware corporation, not in its individual capacity but solely 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 ComEd Financing I, a Delaware statutory business trust (the
"Issuer").
W I T N E S S E T H:
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"); and
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 Payments (as defined herein) and to make certain other
payments on the terms and conditions set forth herein; and
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. In this Guarantee Agreement, unless the context
otherwise requires: (a)
<PAGE>
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; and (c) 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.
"Affiliate" has the same meaning as given to that term in Rule 405 of
the Securities Act of 1933 or any successor rule thereunder.
"Business Day" means any day other than a day on which banking
institutions in Wilmington, Delaware or New York, New York are authorized
or required by any applicable law to close.
"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.
"Debentures" means the series of subordinated debt securities of the
Guarantor designated the ___% Subordinated Deferrable Interest Notes due
2035 held by the Property Trustee of the Issuer.
"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 distributions,
without duplication, with respect to the Preferred Securities, 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 therefor, (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
Preferred Securities called for redemption by the Issuer, and (iii) upon a
voluntary or involuntary dissolution, winding-up or termination of the
Issuer (other than in connection with the distribution 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
<PAGE>
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, representatives or agents of
the Preferred Guarantee Trustee.
"Indenture" means the Indenture dated as of ________, 1995, between
the Guarantor (the "Debenture Issuer") and Wilmington Trust Company, not in
its individual capacity but solely 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;
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<PAGE>
(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, corporation,
estate, partnership, joint venture, association, joint stock company,
limited liability company, trust, unincorporated association, or government
or any agency or political subdivision thereof, or any other entity of
whatever nature.
"Preferred Guarantee Trustee" means Wilmington Trust Company, not in
its individual capacity but solely as trustee under this Guarantee
Agreement, 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 such Successor Preferred Guarantee Trustee.
"Responsible Officer" means, with respect to the Preferred Guarantee
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 Preferred
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.
Section 1.2. Interpretation. Each definition in this Guarantee
Agreement includes the singular and the plural, and references to the neuter
gender include the masculine and feminine where appropriate. Terms which relate
to accounting matters shall be interpreted in accordance with generally accepted
accounting principles in effect from time to time. All references to "the
Guarantee Agreement" or "this Guarantee
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<PAGE>
Agreement" are to this Guarantee Agreement as modified, supplemented or amended
from time to time. References to any statute mean such statute as amended at
the time and include any successor legislation. The word "or" is not exclusive,
and the words "herein," "hereof" and "hereunder" refer to this Guarantee
Agreement as a whole. The headings to the Articles and Sections are for
convenience of reference and shall not affect the meaning or interpretation of
this Guarantee Agreement. References to Articles and Sections mean the Articles
and Sections of this Guarantee Agreement unless otherwise specified.
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.
(b) If and to the extent that any provision of this Guarantee
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 Securities ("List of Holders") as of such date,
(i) within __ Business 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 Indenture Act, if any, in the form and in the manner provided
by Section 313 of the Trust Indenture Act. The Pre-
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<PAGE>
ferred 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 a Responsible Officer has knowledge of 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 committee, or a trust committee of directors
and/or Responsible Officers of the Preferred Guarantee Trustee in good faith
determines 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 Guarantee Trustee shall
have received written notice, or a Responsible Officer charged with the
administration of the Declaration shall have obtained written notice, of such
Event of Default.
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<PAGE>
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 to 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 Preferred Guarantee Trustee. The right, title and interest of the
Preferred Guarantee Trustee shall automatically 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 undertake to perform only such duties as are specifically set
forth in this Guarantee Agreement, and no implied covenants shall be read into
this Guarantee Agreement against the 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 Agreement, and use the same degree of
care and skill in its exercise thereof, as a prudent person would exercise or
use under the circumstances in the conduct of his or her own affairs.
(d) No provision of this Guarantee Agreement shall be construed to
relieve the Preferred Guarantee Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
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<PAGE>
(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 Guarantee Agreement, and no implied
covenants or obligations shall be read into this Guarantee Agreement
against the Preferred Guarantee Trustee; and
(B) in the absence of bad faith on the part of the Preferred
Guarantee Trustee, the Preferred 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 Guarantee 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 conferred
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
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<PAGE>
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 believing that the repayment of
such funds or liability is not reasonably assured to it under the terms of
this Guarantee Agreement or adequate indemnity against such risk or
liability is not reasonably assured to it.
Section 3.2. 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, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and to
have been signed, sent or presented by the proper party or parties.
(ii) Any direction or act of the Guarantor contemplated by this
Guarantee Agreement shall be sufficiently evidenced by a Direction or an
Officers' Certificate.
(iii) Whenever, in the administration of this Guarantee
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 absence of bad faith on its
part, request and rely upon an Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by the Guarantor.
(iv) The Preferred Guarantee Trustee shall have no duty to see
to any recording, filing or registration of any instrument (or any
rerecording, refiling or registration thereof).
(v) The 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 protection in respect
of any action taken, suffered or omitted by it hereunder in good faith and
in accordance with such advice or opinion. Such counsel may be counsel to
the Guarantor or any of its Affiliates and may include any of its
employees. The Preferred Guarantee Trustee shall have the right at any
time to seek instructions
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<PAGE>
concerning the administration of this Guarantee Agreement from any court of
competent 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, unless such
Holder shall have provided to the Preferred Guarantee Trustee such adequate
security and indemnity as would satisfy a reasonable person 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 reasonable
advances as may be requested by the Preferred 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,
certificate, 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 effective 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.
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<PAGE>
(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 a Majority in liquidation amount 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 instructions.
(b) No provision of this Guarantee Agreement shall be deemed to impose
any duty or obligation on the Preferred 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
Preferred 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 Indenture Act, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least fifty
million U.S. dollars ($50,000,000), and subject to supervision or
examination by Federal, State, Territorial or District of Columbia
authority. If such corporation publishes reports of condi-
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<PAGE>
tion at least annually, pursuant to law or to the requirements of the
supervising or examining authority referred to above, then, for the
purposes of this Section 4.1(a)(ii), the combined capital and surplus of
such corporation shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published.
(b) If at any time the Preferred Guarantee Trustee shall cease to be
eligible so to 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 Section 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 Trustee. (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(a) until a Successor Preferred Guarantee Trustee has been
appointed and has accepted such appointment by written instrument executed 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 subsequent 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
instrument 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 Guarantee Trustee.
-12-
<PAGE>
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 otherwise, 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 results 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
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
-13-
<PAGE>
(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or
readjustment of debt of, or other similar proceedings affecting, the Issuer
or any of the assets of the Issuer;
(e) any invalidity of, or defect or deficiency in, the Preferred
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute
a legal or equitable discharge or defense of a guarantor, it being the
intent of this Section 5.3 that the obligations of the Guarantor hereunder
shall be absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain consent
of, the Guarantor with respect to the happening of any of the foregoing.
Section 5.4. 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 Guarantee Trustee
under this Guarantee Agreement.
(b) If the Preferred Guarantee Trustee fails to enforce this Guarantee
Agreement, any Holder of Preferred Securities may institute a legal proceeding
directly against the Guarantor to enforce its rights under this Guarantee
Agreement, 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
-14-
<PAGE>
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 Transaction. 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 which is not a wholly-owned
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 a liquidation
payment 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.
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, including the
Subordinated Notes, except those liabilities of Guarantor made pari passu or
subordinate by their terms, (ii) pari passu with the most senior preferred stock
now or hereafter issued by the Guarantor and with any guarantee now or hereafter
entered into by the Guarantor in respect of any preferred 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 Preferred Securities, (ii)
upon the distribution of the Debentures to the Holders 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
-15-
<PAGE>
time any 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 pertinent to the existence and amount of assets from
which Distributions 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 Indemnified Person reasonably believed to be within the scope
of authority conferred on such Indemnified Person by 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
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 Indemnified Person in defending any claim,
demand, action, suit or proceeding shall, from time to time, be advanced by the
Guarantor prior to the final disposition of such claim, demand, action, suit or
proceeding upon receipt by the Guarantor of an undertaking by or on
-16-
<PAGE>
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
benefit of the Holders of the Preferred Securities then outstanding.
Section 9.2. Amendments. Except with respect to any changes that do
not materially adversely affect the rights of Holders (in which case, no consent
of Holders will be required), this Guarantee Agreement may only be amended with
the prior approval of the Holders of at least 66-2/3% in liquidation amount 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
Preferred Securities):
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890
Attention: _______________
(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 Preferred Securities):
Commonwealth Edison Company
10 South Dearborn Street - 37th Floor
Chicago, Illinois 60690-0767
Attention: Treasurer
-17-
<PAGE>
(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.
THIS GUARANTEE AGREEMENT is executed as of the day and year first
above written.
COMMONWEALTH EDISON COMPANY
By:
Name:
Title:
WILMINGTON TRUST COMPANY, as
Preferred Guarantee Trustee
By:
Name:
Title:
-18-
<PAGE>
Exhibit (5)-1
Commonwealth Edison Company
Form S-3
File No. 33-
Richards, Layton & Finger
One Rodney Square
P.O. Box 551
Wilmington, Delaware 19899
July 27, 1995
ComEd Financing I
c/o Commonwealth Edison Company
10 South Dearborn Street
37th Floor
Chicago, Illinois 60603
Re: ComEd Financing I
-----------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for Commonwealth Edison Company,
an Illinois corporation ("ComEd"), and ComEd Financing I, a Delaware business
trust (the "Trust"), in connection with the matters set forth herein. At your
request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our examination
of documents has been limited to the examination of originals or copies of the
following:
(a) The Certificate of Trust of the Trust, dated July 19, 1995 (the
"Certificate"), as filed in the office of the Secretary of State of the
State of Delaware (the "Secretary of State") on July 21, 1995;
(b) The Declaration of Trust, dated as of July 19, 1995, between
ComEd, as Sponsor, and the trustees of the Trust named therein;
(c) The preliminary prospectus, dated ___________, 1995 (the
"Prospectus"), relating to the __% Trust Originated Preferred Securities of
the Trust representing preferred undivided beneficial interests in the
assets of the Trust (each, a "Preferred Security" and collectively, the
"Preferred Securities");
<PAGE>
ComEd Financing I
July 27, 1995
Page 2
(d) The Registration Statement on Form S-3 (the "Registration
Statement"), including a form of Amended and Restated Declaration of Trust,
to be entered into among ComEd, as Sponsor, and the trustees of the Trust
named therein (the "Trust Agreement"), as proposed to be filed by ComEd and
the Trust with the Securities and Exchange Commission on or about July 27,
1995;
(e) A Certificate of Good Standing for the Trust, dated July 21,
1995, obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are
used as defined in the Trust Agreement.
For purposes of this opinion, we have not reviewed any documents other
than the documents listed in paragraphs (a) through (e) above. In particular,
we have not reviewed any document (other than the documents listed in paragraphs
(a) through (e) above) that is referred to in or incorporated by reference into
the documents reviewed by us. We have assumed that there exists no provision in
any document that we have not reviewed that is inconsistent with the opinions
stated herein. We have conducted no independent factual investigation of our
own but rather have relied solely upon the foregoing documents, the statements
and information set forth therein and the additional matters recited or assumed
herein, all of which we have assumed to be true, complete and accurate in all
material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) the Trust Agreement
and the Certificate are in full force and effect and have not been amended, (ii)
except to the extent provided in paragraph 1 below, the due organization or due
formation, as the case may be, and valid existence in good standing of each
party to the documents examined by us under the laws of the jurisdiction
governing its organization or formation, (iii) the legal capacity of natural
persons who are parties to the documents examined by us, (iv) the power and
authority to each of the parties to the documents examined by us to execute and
deliver, and to perform its obligations under, such documents, (v) the due
authorization, execution and delivery by all parties thereto of all documents
examined by us, (vi) the receipt by each Person to whom a Preferred Security is
to be issued by the Trust (collectively, the "Preferred Security Holders") of a
Preferred Securities Certificate for such Preferred Security and the payment for
the Preferred Security acquired by it, in accordance with the Trust Agreement,
<PAGE>
ComEd Financing I
July 27, 1995
Page 3
the Registration Statement and the Prospectus, and (vii) the issuance and sale
of the Preferred Securities to the Preferred Security Holders in accordance with
the Trust Agreement, the Registration Statement and the Prospectus. We have not
participated in the preparation of the Registration Statement or the Prospectus
and assume no responsibility for their contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and we express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such questions
of law and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act, 12 Del.
C. (S) 3801, et seq.
2. The Preferred Securities will represent valid and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interest in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the Trust,
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Preferred
Security Holders may be obligated, pursuant to the Trust Agreement, to (i)
provide indemnity and/or security in connection with and pay taxes or
governmental charges arising from transfers or exchanges of Preferred
Securities Certificates and the issuance of replacement Preferred
Securities Certificates and (ii) provide security or indemnity in
connection with requests of or directions to the Property Trustee to
exercise its rights and powers under the Trust Agreement.
We consent to the filing of this opinion with the Securities and
Exchange Commission as an exhibit to the Registration Statement. We hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus. In giving the foregoing consents, we do not thereby admit that we
come within the category of Persons whose consent is required under Section 7 of
the Securities Act of 1933, as amended, or the rules
<PAGE>
ComEd Financing I
July 27, 1995
Page 4
and regulations of the Securities and Exchange Commission thereunder. Except as
stated above, without our prior written consent, this opinion may not be
furnished or quoted to, or relied upon by, any other Person for any purpose.
Very truly yours,
Richards, Layton & Finger
<PAGE>
ComEd Financing I
July 27, 1995
Page 5
<PAGE>
Exhibit (5)-2
Commonwealth Edison Company
Form S-3
File No. 33-
SIDLEY & AUSTIN
One First National Plaza
Chicago, Illinois 60603
July __, 1995
ComEd Financing I
Commonwealth Edison Company
37th Floor, 10 South Dearborn Street
Post Office Box 767
Chicago, Illinois 60690
Re: ComEd Financing I
_____% Trust Originated
Preferred Securities ("TOPrS")
------------------------------
Ladies and Gentlemen:
We refer to the Registration Statement on Form S-3 (the "Registration
Statement") being filed by Commonwealth Edison Company (the "Company") and ComEd
Financing I (the "Trust") with the Securities and Exchange Commission (the
"SEC") under the Securities Act of 1933, as amended (the "Securities Act"),
relating to the registration of (i) not to exceed $200,000,000 of % Trust
Originated Preferred Securities ($25 liquidation amount) (the "Preferred
Securities") of the Trust, (ii) the guarantee of the Preferred Securities by the
Company (the "Preferred Securities Guarantee") and (iii) % Subordinated Debt
Securities (the "Debt Securities") of the Company. The Preferred Securities
Guarantee is to be issued pursuant to the Preferred Securities Guarantee
Agreement dated as of , 1995 (the "Preferred Securities Guarantee
Agreement") between the Company and Wilmington Trust Company, as trustee (the
"Agreement Trustee"). The Debt Securities are to be issued under an Indenture
dated as of , 1995 between the Company and Wilmington Trust Company,
as trustee (the "Indenture Trustee"), and a supplemental indenture thereto dated
as of , 1995 (collectively, the "Indenture").
We are familiar with the proceedings to date with respect to the
proposed execution and delivery of the Preferred Securities Guarantee and the
proposed issuance and sale of the Debt Securities and have examined such
records, documents and questions of law, and satisfied ourselves as to such
matters of fact, as we have considered relevant and necessary as a basis for
this opinion.
<PAGE>
ComEd Financing I
Commonwealth Edison Company
July __, 1995
Page 2
Based on the foregoing, we are of the opinion that:
1. The Company is duly incorporated and validly existing under the
laws of the State of Illinois.
2. The Company has corporate power and authority to execute and
deliver the Preferred Securities Guarantee Agreement and the Indenture and to
authorize and sell the Debt Securities.
3. The Preferred Securities Guarantee will be a legally issued and
binding obligation of the Company (except to the extent enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent transfer or other similar laws affecting the enforcement of
creditors' rights generally and by the effect of general principles of equity,
regardless of whether enforceability is considered in a proceeding in equity or
at law) when (i) the Registration Statement, as finally amended, shall have
become effective under the Securities Act; (ii) the Preferred Securities
Guarantee Agreement shall have been qualified under the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act"), and duly executed and delivered by
the Company and the Agreement Trustee; (iii) the Preferred Securities shall have
been legally issued, as contemplated by paragraph 4 below; and (iv) the
Preferred Securities Guarantees shall have been duly executed and delivered as
provided in the Preferred Securities Guarantee Agreement.
4. The Debt Securities will be legally issued and binding
obligations of the Company (except to the extent enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or other similar laws affecting the enforcement of creditors' rights
generally and by the effect of general principles of equity, regardless of
whether enforceability is considered in a proceeding in equity or at law) when
(i) the Registration Statement, as finally amended, shall have become effective
under the Securities Act; (iii) the Indenture shall have been qualified under
the Trust Indenture Act and duly executed and delivered by the Company and the
Indenture Trustee; (iii) the Company's Board of Directors or duly authorized
officers of the Company shall have duly adopted final resolutions authorizing
the issuance and sale of the Debt Securities, as contemplated by the
Registration Statement and the Indenture; and (iv) the Debt Securities shall
have been duly executed and authenticated as provided in the Indenture and shall
have been duly delivered to the purchasers thereof against payment of the agreed
consideration therefor.
We do not find it necessary for the purposes of this opinion to cover,
and accordingly we express no opinion as to,
<PAGE>
ComEd Financing I
Commonwealth Edison Company
July , 1995
Page 3
the application of the securities or blue sky laws of the various states to the
execution and delivery of the Preferred Securities Guarantee or the sale of the
Debt Securities.
We hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement and to all references to our firm included in or made a
part of the Registration Statement. In giving such consent, we do not thereby
admit that we are within the category of persons whose consent is required by
Section 7 of the Securities Act or the related Rules promulgated by the SEC.
Very truly yours,
Sidley & Austin
<PAGE>
Exhibit (8)
Commonwealth Edison Company
Form S-3
File No. 33-
SIDLEY & AUSTIN
One First National Plaza
Chicago, Illinois 60603
July 26, 1995
ComEd Financing I
Commonwealth Edison Company
37th Floor, 10 South Dearborn Street
Post Office Box 767
Chicago, Illinois 60690
Re: ComEd Financing I
__% Trust Originated Preferred
Securities ("TOPrS")
-------------------------------
Ladies and Gentlemen:
Reference is made to the Registration Statement on Form S-3 (the
"Registration Statement") being filed with the Securities and Exchange
Commission by Commonwealth Edison Company ("ComEd") and ComEd Financing I (the
"Trust") and the prospectus contained therein (the "Prospectus") which forms a
part of the Registration Statement.
We have acted as special tax counsel to ComEd and the Trust in connection
with the preparation of the Registration Statement and the Prospectus. The
statements contained in the Prospectus under the caption "Certain Federal Income
Tax Consequences," to the extent they constitute matters of federal income tax
law or legal conclusions with respect thereto, have been prepared or reviewed by
us, and, in our opinion, are correct in all material respects.
This opinion is provided to you only and, without our prior written
consent, may not be relied upon, used, circulated, quoted or otherwise referred
to in any manner by any person, firm governmental authority or entity
whatsoever. This opinion letter is limited to the matters stated herein and no
opinion is implied or may be inferred beyond the matters expressly stated
herein. This opinion letter shall not be construed as or deemed to be a
guaranty or insuring agreement.
<PAGE>
ComEd Financing I
Commonwealth Edison Company
July __, 1995
Page 2
Notwithstanding the immediately preceding paragraph, we hereby consent
to the filing of this opinion as an exhibit to the Registration Statement and to
the reference to this Firm under the captions "Certain Federal Income Tax
Consequences" and "Legal Matters" in the Prospectus. By giving such consent, we
do not thereby admit that we are within the category of persons whose consent is
required under Section 7 of the Securities Act of 1933, as amended, or the rules
promulgated thereunder.
This opinion is rendered as of the date hereof based on the law and
facts in existence on the date hereof, and we do not undertake, and hereby
disclaim, any obligation to advise you of any changes in law or fact, whether or
not material, which may be brought to our attention at a later date.
Very truly yours,
Sidley & Austin
-2-
<PAGE>
Exhibit (12)
Commonwealth Edison Company
Form S-3 File No. 33-
Commonwealth Edison Company and Subsidiary Companies Consolidated
------------------------------------------------------------------
Computation of Ratios of Earnings to Fixed Charges
and Ratios of Earnings to Fixed Charges and
Preferred and Preference Stock Dividend Requirements
-----------------------------------------------------
(Thousands of Dollars)
<TABLE>
<CAPTION>
Line
- --- Year Ended December 31
------------------------------------------------ 12 Months Ended
June 30,
1990 1991 1992 1993 1994 1995
-------- -------- -------- -------- -------- ---------------
<C> <S> <C> <C> <C> <C> <C> <C>
1 Net income $128,291 $ 94,887 $513,981 $112,440 $423,946 $614,661
-------- -------- -------- -------- -------- --------
2 Net provisions for
3 income taxes and
4 investment tax
5 credits deferred
6 charged to --
7 Operations $188,059 $419,855 $271,777 $ 66,406 $300,764 $424,005
8 Cumulative
9 effect of
10 change in
11 accounting
12 for income
13 taxes - - - (9,738) - -
14 Other income 5,634 (65,263) (6,537) (31,655) (23,062) (2,322)
-------- -------- -------- -------- -------- --------
15 $193,693 $354,592 $265,240 $ 25,013 $277,702 $421,683
-------- -------- -------- -------- -------- --------
</TABLE>
<PAGE>
<TABLE>
<C> <S> <C> <C> <C> <C> <C> <C>
16 Fixed charges --
17 Interest on debt $649,467 $665,308 $661,348 $651,639 $621,909 $611,874
18 Estimated interest
19 component of
20 nuclear fuel and
21 other lease payments,
22 rentals and other
23 interest 90,485 79,583 53,348 49,021 64,885 72,533
24 Amortization of
25 debt discount,
26 premium and
27 expense 22,473 21,927 20,178 20,966 22,804 22,572
-------- -------- -------- -------- -------- --------
28 $762,425 $766,818 $734,874 $721,626 $709,598 $706,979
-------- -------- -------- -------- -------- --------
29 Preferred and
30 preference
31 stock dividend
32 requirements --
33 Provisions for
34 preferred and
35 preference stock
36 dividends $ 82,495 $ 78,288 $ 70,539 $ 66,052 $ 64,927 $ 67,673
37 Taxes on income
38 required to meet
39 provisions for
40 preferred and
41 preference stock
42 dividends 52,499 49,675 44,646 43,596 42,854 44,582
-------- -------- -------- -------- -------- --------
43 $134,994 $127,963 $115,185 $109,648 $107,781 $112,255
-------- -------- -------- -------- -------- --------
44 Fixed charges and
45 preferred and
46 preference
47 stock dividend
48 requirements $897,419 $894,781 $850,059 $831,274 $817,379 $819,234
-------- -------- -------- -------- -------- --------
49 Earned for fixed
</TABLE>
<PAGE>
<TABLE>
<C> <S> <C> <C> <C> <C> <C> <C>
50 charges and
51 preferred and
52 preference
53 stock dividend
54 requirements $1,084,409 $1,216,297 $1,514,095 $859,079 $1,411,246 $1,743,323
========== ========== ========== ======== ========== ==========
55 Ratios of earnings
56 to --
57 Fixed charges
58 (line 54 divided
59 by line 28) 1.42 1.59 2.06 1.19 1.99 2.47
========== ========== ========== ======== ========== ==========
60 Fixed charges and
61 preferred and
62 preference
63 stock dividend
64 requirements
65 (line 54 divided
66 by line 48) 1.21 1.36 1.78 1.03 1.73 2.13
========== ========== ========== ======== ========== ==========
</TABLE>
<PAGE>
Exhibit (23)-3
Commonwealth Edison Company
Form S-3
File No. 33-
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this Form S-3 Registration Statement of our reports dated
January 27, 1995, included or incorporated by reference in Commonwealth Edison
Company's Annual Report on Form 10-K for the year ended December 31, 1994 and
our report dated May 9, 1995, included in Commonwealth Edison Company's
Quarterly Report on Form 10-Q for the quarterly period ended March 31, 1995. We
also hereby consent to all references to our Firm included in this Form S-3
Registration Statement.
ARTHUR ANDERSEN LLP
Chicago, Illinois
July 27, 1995
<PAGE>
Exhibit (24)
Commonwealth Edison Company
Form S-3 File No. 33-
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS:
That the undersigned, a Director of Commonwealth Edison Company, an
Illinois corporation, does hereby constitute and appoint JAMES J. O'CONNOR,
SAMUEL K. SKINNER and DAVID A. SCHOLZ, and each of them, her true and lawful
attorneys and agents, each with full power and authority (acting alone and
without the others) to execute in the name and on behalf of the undersigned as
such Director, a Registration Statement on Form S-3 relating to the registration
of subordinated deferrable interest notes of Commonwealth Edison Company and
guarantees of preferred securities of a related business trust by Commonwealth
Edison Company, and any and all amendments or supplements to such Registration
Statement; hereby granting to such attorneys and agents, and each of them, full
power of substitution and revocation in the premises; and hereby ratifying and
confirming all that such attorneys and agents, or any of them, may do or cause
to be done by virtue of these presents.
IN WITNESS WHEREOF, I have hereunto set my hand this 11th day of July,
1995.
Jean Allard
------------------------------
STATE OF ILLINOIS )
) SS
COUNTY OF COOK )
I, Mary T. Snyder, a Notary Public in and for said County, in the State
aforesaid, DO HEREBY CERTIFY that JEAN ALLARD, personally known to me to be the
same person whose name is subscribed to the foregoing instrument, appeared
before me this day in person, and acknowledged that she signed and delivered
said instrument as her free and voluntary act, for the uses and purposes therein
set forth.
GIVEN under my hand and the notarial seal this 11th day of July, 1995.
Mary T. Snyder
------------------------------
Mary T. Snyder
Notary Public
(Notary Public Seal)
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS:
That the undersigned, a Director of Commonwealth Edison Company, an
Illinois corporation, does hereby constitute and appoint JAMES J. O'CONNOR,
SAMUEL K. SKINNER and DAVID A. SCHOLZ, and each of them, her true and lawful
attorneys and agents, each with full power and authority (acting alone and
without the others) to execute in the name and on behalf of the undersigned as
such Director, a Registration Statement on Form S-3 relating to the registration
of subordinated deferrable interest notes of Commonwealth Edison Company and
guarantees of preferred securities of a related business trust by Commonwealth
Edison Company, and any and all amendments or supplements to such Registration
Statement; hereby granting to such attorneys and agents, and each of them, full
power of substitution and revocation in the premises; and hereby ratifying and
confirming all that such attorneys and agents, or any of them, may do or cause
to be done by virtue of these presents.
IN WITNESS WHEREOF, I have hereunto set my hand this 11th day of July,
1995.
Sue L. Gin
------------------------------
STATE OF ILLINOIS )
) SS
COUNTY OF COOK )
I, Mary T. Snyder, a Notary Public in and for said County, in the State
aforesaid, DO HEREBY CERTIFY that SUE L. GIN, personally known to me to be the
same person whose name is subscribed to the foregoing instrument, appeared
before me this day in person, and acknowledged that she signed and delivered
said instrument as her free and voluntary act, for the uses and purposes therein
set forth.
GIVEN under my hand and the notarial seal this 11th day of July, 1995.
Mary T. Snyder
------------------------------
Mary T. Snyder
Notary Public
(Notary Public Seal)
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS:
That the undersigned, a Director of Commonwealth Edison Company, an
Illinois corporation, does hereby constitute and appoint JAMES J. O'CONNOR,
SAMUEL K. SKINNER and DAVID A. SCHOLZ, and each of them, his true and lawful
attorneys and agents, each with full power and authority (acting alone and
without the others) to execute in the name and on behalf of the undersigned as
such Director, a Registration Statement on Form S-3 relating to the registration
of subordinated deferrable interest notes of Commonwealth Edison Company and
guarantees of preferred securities of a related business trust by Commonwealth
Edison Company, and any and all amendments or supplements to such Registration
Statement; hereby granting to such attorneys and agents, and each of them, full
power of substitution and revocation in the premises; and hereby ratifying and
confirming all that such attorneys and agents, or any of them, may do or cause
to be done by virtue of these presents.
IN WITNESS WHEREOF, I have hereunto set my hand this 11th day of July,
1995.
James W. Compton
------------------------------
STATE OF ILLINOIS )
) SS
COUNTY OF COOK )
I, Mary T. Snyder, a Notary Public in and for said County, in the State
aforesaid, DO HEREBY CERTIFY that JAMES W. COMPTON, personally known to me to be
the same person whose name is subscribed to the foregoing instrument, appeared
before me this day in person, and acknowledged that he signed and delivered said
instrument as his free and voluntary act, for the uses and purposes therein set
forth.
GIVEN under my hand and the notarial seal this 11th day of July, 1995.
Mary T. Snyder
------------------------------
Mary T. Snyder
Notary Public
(Notary Public Seal)
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS:
That the undersigned, a Director of Commonwealth Edison Company, an
Illinois corporation, does hereby constitute and appoint JAMES J. O'CONNOR,
SAMUEL K. SKINNER and DAVID A. SCHOLZ, and each of them, his true and lawful
attorneys and agents, each with full power and authority (acting alone and
without the others) to execute in the name and on behalf of the undersigned as
such Director, a Registration Statement on Form S-3 relating to the registration
of subordinated deferrable interest notes of Commonwealth Edison Company and
guarantees of preferred securities of a related business trust by Commonwealth
Edison Company, and any and all amendments or supplements to such Registration
Statement; hereby granting to such attorneys and agents, and each of them, full
power of substitution and revocation in the premises; and hereby ratifying and
confirming all that such attorneys and agents, or any of them, may do or cause
to be done by virtue of these presents.
IN WITNESS WHEREOF, I have hereunto set my hand this 11th day of July,
1995.
Donald P. Jacobs
------------------------------
STATE OF ILLINOIS )
) SS
COUNTY OF COOK )
I, Mary T. Snyder, a Notary Public in and for said County, in the State
aforesaid, DO HEREBY CERTIFY that DONALD P. JACOBS, personally known to me to be
the same person whose name is subscribed to the foregoing instrument, appeared
before me this day in person, and acknowledged that he signed and delivered said
instrument as his free and voluntary act, for the uses and purposes therein set
forth.
GIVEN under my hand and the notarial seal this 11th day of July, 1995.
Mary T. Snyder
------------------------------
Mary T. Snyder
Notary Public
(Notary Public Seal)
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS:
That the undersigned, a Director of Commonwealth Edison Company, an
Illinois corporation, does hereby constitute and appoint JAMES J. O'CONNOR,
SAMUEL K. SKINNER and DAVID A. SCHOLZ, and each of them, his true and lawful
attorneys and agents, each with full power and authority (acting alone and
without the others) to execute in the name and on behalf of the undersigned as
such Director, a Registration Statement on Form S-3 relating to the registration
of subordinated deferrable interest notes of Commonwealth Edison Company and
guarantees of preferred securities of a related business trust by Commonwealth
Edison Company, and any and all amendments or supplements to such Registration
Statement; hereby granting to such attorneys and agents, and each of them, full
power of substitution and revocation in the premises; and hereby ratifying and
confirming all that such attorneys and agents, or any of them, may do or cause
to be done by virtue of these presents.
IN WITNESS WHEREOF, I have hereunto set my hand this 11th day of July,
1995.
Edgar D. Jannotta
------------------------------
STATE OF ILLINOIS )
) SS
COUNTY OF COOK )
I, Mary T. Snyder, a Notary Public in and for said County, in the State
aforesaid, DO HEREBY CERTIFY that EDGAR D. JANNOTTA, personally known to me to
be the same person whose name is subscribed to the foregoing instrument,
appeared before me this day in person, and acknowledged that he signed and
delivered said instrument as his free and voluntary act, for the uses and
purposes therein set forth.
GIVEN under my hand and the notarial seal this 11th day of July, 1995.
Mary T. Snyder
------------------------------
Mary T. Snyder
Notary Public
(Notary Public Seal)
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS:
That the undersigned, a Director of Commonwealth Edison Company, an
Illinois corporation, does hereby constitute and appoint JAMES J. O'CONNOR,
SAMUEL K. SKINNER and DAVID A. SCHOLZ, and each of them, his true and lawful
attorneys and agents, each with full power and authority (acting alone and
without the others) to execute in the name and on behalf of the undersigned as
such Director, a Registration Statement on Form S-3 relating to the registration
of subordinated deferrable interest notes of Commonwealth Edison Company and
guarantees of preferred securities of a related business trust by Commonwealth
Edison Company, and any and all amendments or supplements to such Registration
Statement; hereby granting to such attorneys and agents, and each of them, full
power of substitution and revocation in the premises; and hereby ratifying and
confirming all that such attorneys and agents, or any of them, may do or cause
to be done by virtue of these presents.
IN WITNESS WHEREOF, I have hereunto set my hand this 11th day of July,
1995.
George E. Johnson
------------------------------
STATE OF ILLINOIS )
) SS
COUNTY OF COOK )
I, Mary T. Snyder, a Notary Public in and for said County, in the State
aforesaid, DO HEREBY CERTIFY that GEORGE E. JOHNSON, personally known to me to
be the same person whose name is subscribed to the foregoing instrument,
appeared before me this day in person, and acknowledged that he signed and
delivered said instrument as his free and voluntary act, for the uses and
purposes therein set forth.
GIVEN under my hand and the notarial seal this 11th day of July, 1995.
Mary T. Snyder
------------------------------
Mary T. Snyder
Notary Public
(Notary Public Seal)
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS:
That the undersigned, a Director of Commonwealth Edison Company, an
Illinois corporation, does hereby constitute and appoint JAMES J. O'CONNOR,
SAMUEL K. SKINNER and DAVID A. SCHOLZ, and each of them, his true and lawful
attorneys and agents, each with full power and authority (acting alone and
without the others) to execute in the name and on behalf of the undersigned as
such Director, a Registration Statement on Form S-3 relating to the registration
of subordinated deferrable interest notes of Commonwealth Edison Company and
guarantees of preferred securities of a related business trust by Commonwealth
Edison Company, and any and all amendments or supplements to such Registration
Statement; hereby granting to such attorneys and agents, and each of them, full
power of substitution and revocation in the premises; and hereby ratifying and
confirming all that such attorneys and agents, or any of them, may do or cause
to be done by virtue of these presents.
IN WITNESS WHEREOF, I have hereunto set my hand this 11th day of July,
1995.
Edward A. Mason
------------------------------
STATE OF ILLINOIS )
) SS
COUNTY OF COOK )
I, Mary T. Snyder, a Notary Public in and for said County, in the State
aforesaid, DO HEREBY CERTIFY that EDWARD A. MASON, personally known to me to be
the same person whose name is subscribed to the foregoing instrument, appeared
before me this day in person, and acknowledged that he signed and delivered said
instrument as his free and voluntary act, for the uses and purposes therein set
forth.
GIVEN under my hand and the notarial seal this 11th day of July, 1995.
Mary T. Snyder
------------------------------
Mary T. Snyder
Notary Public
(Notary Public Seal)
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS:
That the undersigned, a Director of Commonwealth Edison Company, an
Illinois corporation, does hereby constitute and appoint JAMES J. O'CONNOR,
SAMUEL K. SKINNER and DAVID A. SCHOLZ, and each of them, his true and lawful
attorneys and agents, each with full power and authority (acting alone and
without the others) to execute in the name and on behalf of the undersigned as
such Director, a Registration Statement on Form S-3 relating to the registration
of subordinated deferrable interest notes of Commonwealth Edison Company and
guarantees of preferred securities of a related business trust by Commonwealth
Edison Company, and any and all amendments or supplements to such Registration
Statement; hereby granting to such attorneys and agents, and each of them, full
power of substitution and revocation in the premises; and hereby ratifying and
confirming all that such attorneys and agents, or any of them, may do or cause
to be done by virtue of these presents.
IN WITNESS WHEREOF, I have hereunto set my hand this 11th day of July,
1995.
F. A. Olson
------------------------------
STATE OF ILLINOIS )
) SS
COUNTY OF COOK )
I, Mary T. Snyder, a Notary Public in and for said County, in the State
aforesaid, DO HEREBY CERTIFY that FRANK A. OLSON, personally known to me to be
the same person whose name is subscribed to the foregoing instrument, appeared
before me this day in person, and acknowledged that he signed and delivered said
instrument as his free and voluntary act, for the uses and purposes therein set
forth.
GIVEN under my hand and the notarial seal this 11th day of July, 1995.
Mary T. Snyder
------------------------------
Mary T. Snyder
Notary Public
(Notary Public Seal)
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS:
That the undersigned, a Director and Officer of Commonwealth Edison
Company, an Illinois corporation, does hereby constitute and appoint JAMES J.
O'CONNOR and DAVID A. SCHOLZ, and each of them, his true and lawful attorneys
and agents, each with full power and authority (acting alone and without the
other) to execute in the name and on behalf of the undersigned as such Director
and Officer, a Registration Statement on Form S-3 relating to the registration
of subordinated deferrable interest notes of Commonwealth Edison Company and
guarantees of preferred securities of a related business trust by Commonwealth
Edison Company, and any and all amendments or supplements to such Registration
Statement; hereby granting to such attorneys and agents, and each of them, full
power of substitution and revocation in the premises; and hereby ratifying and
confirming all that such attorneys and agents, or any of them, may do or cause
to be done by virtue of these presents.
IN WITNESS WHEREOF, I have hereunto set my hand this 11th day of July,
1995.
Samuel K. Skinner
------------------------------
STATE OF ILLINOIS )
) SS
COUNTY OF COOK )
I, Mary T. Snyder, a Notary Public in and for said County, in the State
aforesaid, DO HEREBY CERTIFY that SAMUEL K. SKINNER, personally known to me to
be the same person whose name is subscribed to the foregoing instrument,
appeared before me this day in person, and acknowledged that he signed and
delivered said instrument as his free and voluntary act, for the uses and
purposes therein set forth.
GIVEN under my hand and the notarial seal this 11th day of July, 1995.
Mary T. Snyder
------------------------------
Mary T. Snyder
Notary Public
(Notary Public Seal)
<PAGE>
Exhibit (25)-1
Commonwealth Edison Company
Form S-3 File No. 33-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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)
Myfanwy P. Bonilla
Assistant Vice President and Trust Counsel
Wilmington Trust Company
Rodney Square North
Wilmington, Delaware 19890
(302) 651-8914
(Name, address and telephone number of agent for service)
COMMONWEALTH EDISON COMPANY
COMED FINANCING I
(Exact name of obligor as specified in its charter)
Illinois 36-0938600
Delaware Applied For
(State of incorporation) (I.R.S. employer identification no.)
10 South Dearborn Street-37th Floor
Post Office Box 767
Chicago, Illinois 60690-0767
(Address of principal executive offices) (Zip Code)
____ % Trust Originated Preferred Securities of ComEd 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 Commissioner
Five Penn Center Dover, Delaware
Suite #2901
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. Copy of the 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.
B. Copy of By-Laws of Wilmington Trust Company.
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 17th day of July, 1995.
WILMINGTON TRUST COMPANY
[SEAL]
By: /s/ Emmett R. Harmon
-------------------------
Attest: /s/ Donald G. MacKelcan Name: Emmett R. Harmon
--------------------------- Title: Vice President
Assistant Secretary
2
<PAGE>
EXHIBIT A
AMENDED CHARTER
WILMINGTON TRUST COMPANY
WILMINGTON, DELAWARE
AS EXISTING ON MAY 9, 1987
<PAGE>
AMENDED CHARTER
OR
ACT OF INCORPORATION
OF
WILMINGTON TRUST COMPANY
WILMINGTON TRUST COMPANY, originally incorporated by an Act of the General
Assembly of the State of Delaware, entitled "An Act to Incorporate the Delaware
Guarantee and Trust Company", approved March 2, A.D. 1901, and the name of which
company was changed to "WILMINGTON TRUST COMPANY" by an amendment filed in the
Office of the Secretary of State on March 18, A.D. 1903, and the Charter or Act
of Incorporation of which company has been from time to time amended and changed
by merger agreements pursuant to the corporation law for state banks and trust
companies of the State of Delaware, does hereby alter and amend its Charter or
Act of Incorporation so that the same as so altered and amended shall in its
entirety read as follows:
FIRST: - The name of this corporation is WILMINGTON TRUST COMPANY.
SECOND: - The location of its principal office in the State of Delaware is
at Rodney Square North, in the City of Wilmington, County of New Castle;
the name of its resident agent is WILMINGTON TRUST COMPANY whose address is
Rodney Square North, in said City. In addition to such principal office,
the said corporation maintains and operates branch offices in the City of
Newark, New Castle County, Delaware, the Town of Newport, New Castle
County, Delaware, at Claymont, New Castle County, Delaware, at Greenville,
New Castle County Delaware, and at Milford Cross Roads, New Castle County,
Delaware, and shall be empowered to open, maintain and operate branch
offices at Ninth and Shipley Streets, 418 Delaware Avenue, 2120 Market
Street, and 3605 Market Street, all in the City of Wilmington, New Castle
County, Delaware, and such other branch offices or places of business as
may be authorized from time to time by the agency or agencies of the
government of the State of Delaware empowered to confer such authority.
THIRD: - (a) The nature of the business and the objects and purposes
proposed to be transacted, promoted or carried on by this Corporation are
to do any or all of the things herein mentioned as fully and to the same
extent as natural persons might or could do and in any part of the world,
viz.:
(1) To sue and be sued, complain and defend in any Court of law or
equity and to make and use a common
<PAGE>
seal, and alter the seal at pleasure, to hold, purchase, convey,
mortgage or otherwise deal in real and personal estate and property,
and to appoint such officers and agents as the business of the
Corporation shall require, to make by-laws not inconsistent with the
Constitution or laws of the United States or of this State, to
discount bills, notes or other evidences of debt, to receive deposits
of money, or securities for money, to buy gold and silver bullion and
foreign coins, to buy and sell bills of exchange, and generally to
use, exercise and enjoy all the powers, rights, privileges and
franchises incident to a corporation which are proper or necessary for
the transaction of the business of the Corporation hereby created.
(2) To insure titles to real and personal property, or any estate or
interests therein, and to guarantee the holder of such property, real
or personal, against any claim or claims, adverse to his interest
therein, and to prepare and give certificates of title for any lands
or premises in the State of Delaware, or elsewhere.
(3) To act as factor, agent, broker or attorney in the receipt,
collection, custody, investment and management of funds, and the
purchase, sale, management and disposal of property of all
descriptions, and to prepare and execute all papers which may be
necessary or proper in such business.
(4) To prepare and draw agreements, contracts, deeds, leases,
conveyances, mortgages, bonds and legal papers of every description,
and to carry on the business of conveyancing in all its branches.
(5) To receive upon deposit for safekeeping money, jewelry, plate,
deeds, bonds and any and all other personal property of every sort and
kind, from executors, administrators, guardians, public officers,
courts, receivers, assignees, trustees, and from all fiduciaries, and
from all other persons and individuals, and from all corporations
whether state, municipal, corporate or private, and to rent boxes,
safes, vaults and other receptacles for such property.
(6) To act as agent or otherwise for the purpose of registering,
issuing, certificating, countersigning, transferring or underwriting
the stock, bonds or other obligations of any corporation, association,
state or municipality, and may receive and manage any sinking fund
therefor on such terms as may be agreed upon between the two parties,
and in like manner may act as Treasurer of any corporation or
municipality.
2
<PAGE>
(7) To act as Trustee under any deed of trust, mortgage, bond or
other instrument issued by any state, municipality, body politic,
corporation, association or person, either alone or in conjunction
with any other person or persons, corporation or corporations.
(8) To guarantee the validity, performance or effect of any contract
or agreement, and the fidelity of persons holding places of
responsibility or trust; to become surety for any person, or persons,
for the faithful performance of any trust, office, duty, contract or
agreement, either by itself or in conjunction with any other person,
or persons, corporation, or corporations, or in like manner become
surety upon any bond, recognizance, obligation, judgment, suit, order,
or decree to be entered in any court of record within the State of
Delaware or elsewhere, or which may now or hereafter be required by
any law, judge, officer or court in the State of Delaware or
elsewhere.
(9) To act by any and every method of appointment as trustee, trustee
in bankruptcy, receiver, assignee, assignee in bankruptcy, executor,
administrator, guardian, bailee, or in any other trust capacity in the
receiving, holding, managing, and disposing of any and all estates and
property, real, personal or mixed, and to be appointed as such
trustee, trustee in bankruptcy, receiver, assignee, assignee in
bankruptcy, executor, administrator, guardian or bailee by any
persons, corporations, court, officer, or authority, in the State of
Delaware or elsewhere; and whenever this Corporation is so appointed
by any person, corporation, court, officer or authority such trustee,
trustee in bankruptcy, receiver, assignee, assignee in bankruptcy,
executor, administrator, guardian, bailee, or in any other trust
capacity, it shall not be required to give bond with surety, but its
capital stock shall be taken and held as security for the performance
of the duties devolving upon it by such appointment.
(10) And for its care, management and trouble, and the exercise of
any of its powers hereby given, or for the performance of any of the
duties which it may undertake or be called upon to perform, or for the
assumption of any responsibility the said Corporation may be entitled
to receive a proper compensation.
(11) To purchase, receive, hold and own bonds, mortgages, debentures,
shares of capital stock, and other securities, obligations, contracts
and evidences of indebtedness, of any private, public or municipal
3
<PAGE>
corporation within and without the State of Delaware, or of the
Government of the United States, or of any state, territory, colony,
or possession thereof, or of any foreign government or country; to
receive, collect, receipt for, and dispose of interest, dividends and
income upon and from any of the bonds, mortgages, debentures, notes,
shares of capital stock, securities, obligations, contracts, evidences
of indebtedness and other property held and owned by it, and to
exercise in respect of all such bonds, mortgages, debentures, notes,
shares of capital stock, securities, obligations, contracts, evidences
of indebtedness and other property, any and all the rights, powers and
privileges of individual owners thereof, including the right to vote
thereon; to invest and deal in and with any of the moneys of the
Corporation upon such securities and in such manner as it may think
fit and proper, and from time to time to vary or realize such
investments; to issue bonds and secure the same by pledges or deeds of
trust or mortgages of or upon the whole or any part of the property
held or owned by the Corporation, and to sell and pledge such bonds,
as and when the Board of Directors shall determine, and in the
promotion of its said corporate business of investment and to the
extent authorized by law, to lease, purchase, hold, sell, assign,
transfer, pledge, mortgage and convey real and personal property of
any name and nature and any estate or interest therein.
(b) In furtherance of, and not in limitation, of the powers conferred by
the laws of the State of Delaware, it is hereby expressly provided that the
said Corporation shall also have the following powers:
(1) To do any or all of the things herein set forth, to the same
extent as natural persons might or could do, and in any part of the
world.
(2) To acquire the good will, rights, property and franchises and to
undertake the whole or any part of the assets and liabilities of any
person, firm, association or corporation, and to pay for the same in
cash, stock of this Corporation, bonds or otherwise; to hold or in any
manner to dispose of the whole or any part of the property so
purchased; to conduct in any lawful manner the whole or any part of
any business so acquired, and to exercise all the powers necessary or
convenient in and about the conduct and management of such business.
(3) To take, hold, own, deal in, mortgage or otherwise lien, and to
lease, sell, exchange, transfer, or in any
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manner whatever dispose of property, real, personal or mixed, wherever
situated.
(4) To enter into, make, perform and carry out contracts of every
kind with any person, firm, association or corporation, and, without
limit as to amount, to draw, make, accept, endorse, discount, execute
and issue promissory notes, drafts, bills of exchange, warrants,
bonds, debentures, and other negotiable or transferable instruments.
(5) To have one or more offices, to carry on all or any of its
operations and businesses, without restriction to the same extent as
natural persons might or could do, to purchase or otherwise acquire,
to hold, own, to mortgage, sell, convey or otherwise dispose of, real
and personal property, of every class and description, in any State,
District, Territory or Colony of the United States, and in any foreign
country or place.
(6) It is the intention that the objects, purposes and powers
specified and clauses contained in this paragraph shall (except where
otherwise expressed in said paragraph) be nowise limited or restricted
by reference to or inference from the terms of any other clause of
this or any other paragraph in this charter, but that the objects,
purposes and powers specified in each of the clauses of this paragraph
shall be regarded as independent objects, purposes and powers.
FOURTH: - (a) The total number of shares of all classes of stock which the
Corporation shall have authority to issue is forty-one million (41,000,000)
shares, consisting of:
(1) One million (1,000,000) shares of Preferred stock, par value
$10.00 per share (hereinafter referred to as "Preferred Stock"); and
(2) Forty million (40,000,000) shares of Common Stock, par value
$1.00 per share (hereinafter referred to as "Common Stock").
(b) Shares of Preferred Stock may be issued from time to time in one or
more series as may from time to time be determined by the Board of
Directors each of said series to be distinctly designated. All shares of
any one series of Preferred Stock shall be alike in every particular,
except that there may be different dates from which dividends, if any,
thereon shall be cumulative, if made cumulative. The voting powers and the
preferences and relative, participating, optional and other special rights
of each
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such series, and the qualifications, limitations or restrictions thereof,
if any, may differ from those of any and all other series at any time
outstanding; and, subject to the provisions of subparagraph 1 of Paragraph
(c) of this Article FOURTH, the Board of Directors of the Corporation is
hereby expressly granted authority to fix by resolution or resolutions
adopted prior to the issuance of any shares of a particular series of
Preferred Stock, the voting powers and the designations, preferences and
relative, optional and other special rights, and the qualifications,
limitations and restrictions of such series, including, but without
limiting the generality of the foregoing, the following:
(1) The distinctive designation of, and the number of shares of
Preferred Stock which shall constitute such series, which number may
be increased (except where otherwise provided by the Board of
Directors) or decreased (but not below the number of shares thereof
then outstanding) from time to time by like action of the Board of
Directors;
(2) The rate and times at which, and the terms and conditions on
which, dividends, if any, on Preferred Stock of such series shall be
paid, the extent of the preference or relation, if any, of such
dividends to the dividends payable on any other class or classes, or
series of the same or other class of stock and whether such dividends
shall be cumulative or non-cumulative;
(3) The right, if any, of the holders of Preferred Stock of such
series to convert the same into or exchange the same for, shares of
any other class or classes or of any series of the same or any other
class or classes of stock of the Corporation and the terms and
conditions of such conversion or exchange;
(4) Whether or not Preferred Stock of such series shall be subject to
redemption, and the redemption price or prices and the time or times
at which, and the terms and conditions on which, Preferred Stock of
such series may be redeemed.
(5) The rights, if any, of the holders of Preferred Stock of such
series upon the voluntary or involuntary liquidation, merger,
consolidation, distribution or sale of assets, dissolution or winding-
up, of the Corporation.
(6) The terms of the sinking fund or redemption or purchase account,
if any, to be provided for the Preferred Stock of such series; and
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(7) The voting powers, if any, of the holders of such series of
Preferred Stock which may, without limiting the generality of the
foregoing include the right, voting as a series or by itself or
together with other series of Preferred Stock or all series of
Preferred Stock as a class, to elect one or more directors of the
Corporation if there shall have been a default in the payment of
dividends on any one or more series of Preferred Stock or under such
circumstances and on such conditions as the Board of Directors may
determine.
(c) (1) After the requirements with respect to preferential dividends on
the Preferred Stock (fixed in accordance with the provisions of section (b)
of this Article FOURTH), if any, shall have been met and after the
Corporation shall have complied with all the requirements, if any, with
respect to the setting aside of sums as sinking funds or redemption or
purchase accounts (fixed in accordance with the provisions of section (b)
of this Article FOURTH), and subject further to any conditions which may be
fixed in accordance with the provisions of section (b) of this Article
FOURTH, then and not otherwise the holders of Common Stock shall be
entitled to receive such dividends as may be declared from time to time by
the Board of Directors.
(2) After distribution in full of the preferential amount, if any,
(fixed in accordance with the provisions of section (b) of this
Article FOURTH), to be distributed to the holders of Preferred Stock
in the event of voluntary or involuntary liquidation, distribution or
sale of assets, dissolution or winding-up, of the Corporation, the
holders of the Common Stock shall be entitled to receive all of the
remaining assets of the Corporation, tangible and intangible, of
whatever kind available for distribution to stockholders ratably in
proportion to the number of shares of Common Stock held by them
respectively.
(3) Except as may otherwise be required by law or by the provisions
of such resolution or resolutions as may be adopted by the Board of
Directors pursuant to section (b) of this Article FOURTH, each holder
of Common Stock shall have one vote in respect of each share of Common
Stock held on all matters voted upon by the stockholders.
(d) No holder of any of the shares of any class or series of stock or of
options, warrants or other rights to purchase shares of any class or series
of stock or of other securities of the Corporation shall have any
preemptive right to purchase or subscribe for any unissued stock of any
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class or series or any additional shares of any class or series to be
issued by reason of any increase of the authorized capital stock of the
Corporation of any class or series, or bonds, certificates of indebtedness,
debentures or other securities convertible into or exchangeable for stock
of the Corporation of any class or series, or carrying any right to
purchase stock of any class or series, but any such unissued stock,
additional authorized issue of shares of any class or series of stock or
securities convertible into or exchangeable for stock, or carrying any
right to purchase stock, may be issued and disposed of pursuant to
resolution of the Board of Directors to such persons, firms, corporations
or associations, whether such holders or others, and upon such terms as may
be deemed advisable by the Board of Directors in the exercise of its sole
discretion.
(e) The relative powers, preferences and rights of each series of
Preferred Stock in relation to the relative powers, preferences and rights
of each other series of Preferred Stock shall, in each case, be as fixed
from time to time by the Board of Directors in the resolution or
resolutions adopted pursuant to authority granted in section (b) of this
Article FOURTH and the consent, by class or series vote or otherwise, of
the holders of such of the series of Preferred Stock as are from time to
time outstanding shall not be required for the issuance by the Board of
Directors of any other series of Preferred Stock whether or not the powers,
preferences and rights of such other series shall be fixed by the Board of
Directors as senior to, or on a parity with, the powers, preferences and
rights of such outstanding series, or any of them; provided, however, that
the Board of Directors may provide in the resolution or resolutions as to
any series of Preferred Stock adopted pursuant to section (b) of this
Article FOURTH that the consent of the holders of a majority (or such
greater proportion as shall be therein fixed) of the outstanding shares of
such series voting thereon shall be required for the issuance of any or all
other series of Preferred Stock.
(f) Subject to the provisions of section (e), shares of any series of
Preferred Stock may be issued from time to time as the Board of Directors
of the Corporation shall determine and on such terms and for such
consideration as shall be fixed by the Board of Directors.
(g) Shares of Common Stock may be issued from time to time as the Board of
Directors of the Corporation shall determine and on such terms and for such
consideration as shall be fixed by the Board of Directors.
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(h) The authorized amount of shares of Common Stock and of Preferred Stock
may, without a class or series vote, be increased or decreased from time to
time by the affirmative vote of the holders of a majority of the stock of
the Corporation entitled to vote thereon.
FIFTH: - (a) The business and affairs of the Corporation shall be
conducted and managed by a Board of Directors. The number of directors
constituting the entire Board shall be not less than five nor more than
twenty-five as fixed from time to time by vote of a majority of the whole
Board, provided, however, that the number of directors shall not be reduced
so as to shorten the term of any director at the time in office, and
provided further, that the number of directors constituting the whole Board
shall be twenty-four until otherwise fixed by a majority of the whole
Board.
(b) The Board of Directors shall be divided into three classes, as nearly
equal in number as the then total number of directors constituting the
whole Board permits, with the term of office of one class expiring each
year. At the annual meeting of stockholders in 1982, directors of the
first class shall be elected to hold office for a term expiring at the next
succeeding annual meeting, directors of the second class shall be elected
to hold office for a term expiring at the second succeeding annual meeting
and directors of the third class shall be elected to hold office for a term
expiring at the third succeeding annual meeting. Any vacancies in the
Board of Directors for any reason, and any newly created directorships
resulting from any increase in the directors, may be filled by the Board of
Directors, acting by a majority of the directors then in office, although
less than a quorum, and any directors so chosen shall hold office until the
next annual election of directors. At such election, the stockholders
shall elect a successor to such director to hold office until the next
election of the class for which such director shall have been chosen and
until his successor shall be elected and qualified. No decrease in the
number of directors shall shorten the term of any incumbent director.
(c) Notwithstanding any other provisions of this Charter or Act of
Incorporation or the By-Laws of the Corporation (and notwithstanding the
fact that some lesser percentage may be specified by law, this Charter or
Act of Incorporation or the By-Laws of the Corporation), any director or
the entire Board of Directors of the Corporation may be removed at any time
without cause, but only by the affirmative vote of the holders of two-
thirds or more of the outstanding shares of capital stock of the
Corporation entitled to vote generally in the election of directors
(considered for this purpose as one class) cast at a meeting of the
stockholders called for
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that purpose.
(d) Nominations for the election of directors may be made by the Board of
Directors or by any stockholder entitled to vote for the election of
directors. Such nominations shall be made by notice in writing, delivered
or mailed by first class United States mail, postage prepaid, to the
Secretary of the Corporation not less than 14 days nor more than 50 days
prior to any meeting of the stockholders called for the election of
directors; provided, however, that if less than 21 days' notice of the
meeting is given to stockholders, such written notice shall be delivered or
mailed, as prescribed, to the Secretary of the Corporation not later than
the close of the seventh day following the day on which notice of the
meeting was mailed to stockholders. Notice of nominations which are
proposed by the Board of Directors shall be given by the Chairman on behalf
of the Board.
(e) Each notice under subsection (d) shall set forth (i) the name, age,
business address and, if known, residence address of each nominee proposed
in such notice, (ii) the principal occupation or employment of such nominee
and (iii) the number of shares of stock of the Corporation which are
beneficially owned by each such nominee.
(f) The Chairman of the meeting may, if the facts warrant, determine and
declare to the meeting that a nomination was not made in accordance with
the foregoing procedure, and if he should so determine, he shall so declare
to the meeting and the defective nomination shall be disregarded.
(g) No action required to be taken or which may be taken at any annual or
special meeting of stockholders of the Corporation may be taken without a
meeting, and the power of stockholders to consent in writing, without a
meeting, to the taking of any action is specifically denied.
SIXTH: - The Directors shall choose such officers, agent and servants as
may be provided in the By-Laws as they may from time to time find necessary
or proper.
SEVENTH: - The Corporation hereby created is hereby given the same powers,
rights and privileges as may be conferred upon corporations organized under
the Act entitled "An Act Providing a General Corporation Law", approved
March 10, 1899, as from time to time amended.
EIGHTH: - This Act shall be deemed and taken to be a private Act.
NINTH: - This Corporation is to have perpetual existence.
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TENTH: - The Board of Directors, by resolution passed by a majority of the
whole Board, may designate any of their number to constitute an Executive
Committee, which Committee, to the extent provided in said resolution, or
in the By-Laws of the Company, shall have and may exercise all of the
powers of the Board of Directors in the management of the business and
affairs of the Corporation, and shall have power to authorize the seal of
the Corporation to be affixed to all papers which may require it.
ELEVENTH: - The private property of the stockholders shall not be liable
for the payment of corporate debts to any extent whatever.
TWELFTH: - The Corporation may transact business in any part of the world.
THIRTEENTH: - The Board of Directors of the Corporation is expressly
authorized to make, alter or repeal the By-Laws of the Corporation by a
vote of the majority of the entire Board. The stockholders may make, alter
or repeal any By-Law whether or not adopted by them, provided however, that
any such additional By-Laws, alterations or repeal may be adopted only by
the affirmative vote of the holders of two-thirds or more of the
outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors (considered for this purpose as one
class).
FOURTEENTH: - Meetings of the Directors may be held outside of the State of
Delaware at such places as may be from time to time designated by the
Board, and the Directors may keep the books of the Company outside of the
State of Delaware at such places as may be from time to time designated by
them.
FIFTEENTH: - (a) In addition to any affirmative vote required by law, and
except as otherwise expressly provided in sections (b) and (c) of this
Article FIFTEENTH:
(A) any merger or consolidation of the Corporation or any Subsidiary
(as hereinafter defined) with or into (i) any Interested Stockholder
(as hereinafter defined) or (ii) any other corporation (whether or not
itself an Interested Stockholder), which, after such merger or
consolidation, would be an Affiliate (as hereinafter defined) of an
Interested Stockholder, or
(B) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition (in one transaction or a series of related transactions)
to or with any Interested Stockholder or any Affiliate of any
Interested Stockholder of any assets of the Corporation or any
Subsidiary having an aggregate fair market value
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of $1,000,000 or more, or
(C) the issuance or transfer by the Corporation or any Subsidiary (in
one transaction or a series of related transactions) of any securities
of the Corporation or any Subsidiary to any Interested Stockholder or
any Affiliate of any Interested Stockholder in exchange for cash,
securities or other property (or a combination thereof) having an
aggregate fair market value of $1,000,000 or more, or
(D) the adoption of any plan or proposal for the liquidation or
dissolution of the Corporation, or
(E) any reclassification of securities (including any reverse stock
split), or recapitalization of the Corporation, or any merger or
consolidation of the Corporation with any of its Subsidiaries or any
similar transaction (whether or not with or into or otherwise
involving an Interested Stockholder) which has the effect, directly or
indirectly, of increasing the proportionate share of the outstanding
shares of any class of equity or convertible securities of the
Corporation or any Subsidiary which is directly or indirectly owned by
any Interested Stockholder, or any Affiliate of any Interested
Stockholder,
shall require the affirmative vote of the holders of at least two-thirds of the
outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors, considered for the purpose of this
Article FIFTEENTH as one class ("Voting Shares"). Such affirmative vote shall
be required notwithstanding the fact that no vote may be required, or that some
lesser percentage may be specified, by law or in any agreement with any national
securities exchange or otherwise.
(2) The term "business combination" as used in this Article
FIFTEENTH shall mean any transaction which is referred to any one
or more of clauses (A) through (E) of paragraph 1 of the section
(a).
(b) The provisions of section (a) of this Article FIFTEENTH shall not
be applicable to any particular business combination and such business
combination shall require only such affirmative vote as is required by
law and any other provisions of the Charter or Act of Incorporation of
By-Laws if such business combination has been approved by a majority
of the whole Board.
(c) For the purposes of this Article FIFTEENTH:
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(1) A "person" shall mean any individual firm, corporation or other
entity.
(2) "Interested Stockholder" shall mean, in respect of any business
combination, any person (other than the Corporation or any Subsidiary) who
or which as of the record date for the determination of stockholders
entitled to notice of and to vote on such business combination, or
immediately prior to the consummation of any such transaction:
(A) is the beneficial owner, directly or indirectly, of more than 10%
of the Voting Shares, or
(B) is an Affiliate of the Corporation and at any time within two
years prior thereto was the beneficial owner, directly or indirectly,
of not less than 10% of the then outstanding voting Shares, or
(C) is an assignee of or has otherwise succeeded in any share of
capital stock of the Corporation which were at any time within two
years prior thereto beneficially owned by any Interested Stockholder,
and such assignment or succession shall have occurred in the course of
a transaction or series of transactions not involving a public
offering within the meaning of the Securities Act of 1933.
(3) A person shall be the "beneficial owner" of any Voting Shares:
(A) which such person or any of its Affiliates and Associates (as
hereafter defined) beneficially own, directly or indirectly, or
(B) which such person or any of its Affiliates or Associates has (i)
the right to acquire (whether such right is exercisable immediately or
only after the passage of time), pursuant to any agreement,
arrangement or understanding or upon the exercise of conversion
rights, exchange rights, warrants or options, or otherwise, or (ii)
the right to vote pursuant to any agreement, arrangement or
understanding, or
(C) which are beneficially owned, directly or indirectly, by any
other person with which such first mentioned person or any of its
Affiliates or Associates has any agreement, arrangement or
understanding for the purpose of acquiring, holding, voting or
disposing of any shares of capital stock of the Corporation.
(4) The outstanding Voting Shares shall include shares
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deemed owned through application of paragraph (3) above but shall not
include any other Voting Shares which may be issuable pursuant to any
agreement, or upon exercise of conversion rights, warrants or options or
otherwise.
(5) "Affiliate" and "Associate" shall have the respective meanings given
those terms in Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as in effect on December 31, 1981.
(6) "Subsidiary" shall mean any corporation of which a majority of any
class of equity security (as defined in Rule 3a11-1 of the General Rules
and Regulations under the Securities Exchange Act of 1934, as in effect in
December 31, 1981) is owned, directly or indirectly, by the Corporation;
provided, however, that for the purposes of the definition of Investment
Stockholder set forth in paragraph (2) of this section (c), the term
"Subsidiary" shall mean only a corporation of which a majority of each
class of equity security is owned, directly or indirectly, by the
Corporation.
(d) majority of the directors shall have the power and duty to
determine for the purposes of this Article FIFTEENTH on the basis of
information known to them, (1) the number of Voting Shares
beneficially owned by any person (2) whether a person is an Affiliate
or Associate of another, (3) whether a person has an agreement,
arrangement or understanding with another as to the matters referred
to in paragraph (3) of section (c), or (4) whether the assets subject
to any business combination or the consideration received for the
issuance or transfer of securities by the Corporation, or any
Subsidiary has an aggregate fair market value of $1,00,000 or more.
(e) Nothing contained in this Article FIFTEENTH shall be construed to
relieve any Interested Stockholder from any fiduciary obligation
imposed by law.
SIXTEENTH: Notwithstanding any other provision of this Charter or Act of
Incorporation or the By-Laws of the Corporation (and in addition to any
other vote that may be required by law, this Charter or Act of
Incorporation by the By-Laws), the affirmative vote of the holders of at
least two-thirds of the outstanding shares of the capital stock of the
Corporation entitled to vote generally in the election of directors
(considered for this purpose as one class) shall be required to amend,
alter or repeal any provision of Articles FIFTH, THIRTEENTH, FIFTEENTH or
SIXTEENTH of this Charter or Act of Incorporation.
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SEVENTEENTH: (a) a Director of this Corporation shall not be liable to the
Corporation or its stockholders for monetary damages for breach of
fiduciary duty as a Director, except to the extent such exemption from
liability or limitation thereof is not permitted under the Delaware General
Corporation Laws as the same exists or may hereafter be amended.
(b) Any repeal or modification of the foregoing paragraph shall not
adversely affect any right or protection of a Director of the
Corporation existing hereunder with respect to any act or omission
occurring prior to the time of such repeal or modification."
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I ___________________________________________
_________________ Secretary of WILMINGTON TRUST COMPANY, do
hereby certify that the foregoing is a true and correct copy of
the Charter or Act of Incorporation of WILMINGTON TRUST COMPANY,
as heretofore amended and changed from time to time, copies of
which, certified by the Secretary of the State of Delaware, are
on file in the office of WILMINGTON TRUST COMPANY.
Date __________________
_______________________________________
Secretary
<PAGE>
EXHIBIT B
BY-LAWS
WILMINGTON TRUST COMPANY
WILMINGTON, DELAWARE
AS EXISTING ON FEBRUARY 21, 1991
<PAGE>
BY-LAWS OF WILMINGTON TRUST COMPANY
ARTICLE I
STOCKHOLDERS' MEETINGS
Section 1. The Annual Meeting of Stockholders shall be held on the third
Thursday in April each year at the principal office at the Company or at such
other date, time, or place as may be designated by resolution by the Board of
Directors.
Section 2. Special meetings of all stockholders may be called at any time
by the Board of Directors, the Chairman of the Board or the President.
Section 3. Notice of all meetings of the stockholders shall be given by
mailing to each stockholder at least ten (10 days before said meeting, at his
last known address, a written or printed notice fixing the time and place of
such meeting.
Section 4. A majority in the amount of the capital stock of the Company
issued and outstanding on the record date, as herein determined, shall
constitute a quorum at all meetings of stockholders for the transaction of any
business, but the holders of a small number of shares may adjourn, from time to
time, without further notice, until a quorum is secured. At each annual or
special meeting of stockholders, each stockholder shall be entitled to one vote,
either in person or by proxy, for each shares of stock registered in the
stockholder's name on the books of the Company on the record date for any such
meeting as determined herein.
ARTICLE II
DIRECTORS
Section 1. The number and classification of the Board of Directors shall
be as set forth in the Charter of the Bank.
Section 2. No person who has attained the age of seventy-two (72) years
shall be nominated for election to the Board of Directors of the Company,
provided, however, that this limitation shall not apply to any person who was
serving as director of the Company on September 16, 1971.
Section 3. The class of Directors so elected shall hold office for three
years or until their successors are elected and qualified.
Section 4. The affairs and business of the Company shall be managed and
conducted by the Board of Directors.
Section 5. Regular meetings of the Board of Directors shall
<PAGE>
be held on the third Thursday of each month at the principal office of the
Company, or at such other place and time as may be designated by the Board of
Directors, the Chairman of the Board, or the President.
Section 6. Special meetings of the Board of Directors may be called at any
time by the Chairman of the Board of Directors or by the President, and shall be
called upon the written request of a majority of the directors.
Section 7. A majority of the directors elected and qualified shall be
necessary to constitute a quorum for the transaction of business at any meeting
of the Board of Directors.
Section 8. Written notice shall be sent by mail to each director of any
special meeting of the Board of Directors, and of any change in the time or
place of any regular meeting, stating the time and place of such meeting, which
shall be mailed not less than two days before the time of holding such meeting.
Section 9. In the event of the death, resignation, removal, inability to
act, or disqualification of any director, the Board of Directors, although less
than a quorum, shall have the right to elect the successor who shall hold office
for the remainder of the full term of the class of directors in which the
vacancy occurred, and until such director's successor shall have been duly
elected and qualified.
Section 10. The Board of Directors at its first meeting after its election
by the stockholders shall appoint an Executive Committee, a Trust Committee, an
Audit Committee and a Compensation Committee, and shall elect from its own
members a Chairman of the Board of Directors and a President who may be the same
person. The Board of Directors shall also elect at such meeting a Secretary and
a Treasurer, who may be the same person, may appoint at any time such other
committees and elect or appoint such other officers as it may deem advisable.
The Board of Directors may also elect at such meeting one or more Associate
Directors.
Section 11. The Board of Directors may at any time remove, with or without
cause, any member of any Committee appointed by it or any associate director or
officer elected by it and may appoint or elect his successor.
Section 12. The Board of Directors may designate an officer to be in
charge of such of the departments or division of the Company as it may deem
advisable.
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ARTICLE III
COMMITTEES
Section I. Executive Committee
(A) The Executive Committee shall be composed of not more than nine
members who shall be selected by the Board of Directors from its own members and
who shall hold office during the pleasure of the Board.
(B) The Executive Committee shall have all the powers of the Board of
Directors when it is not in session to transact all business for and in behalf
of the Company that may be brought before it.
(C) The Executive Committee shall meet at the principal office of the
Company or elsewhere in its discretion at least once a week in each week the
Board is not regularly scheduled to meet. A majority of its members shall be
necessary to constitute a quorum for the transaction of business. Special
meetings of the Executive Committee may be held at any time when a quorum is
present.
(D) Minutes of each meeting of the Executive Committee shall be kept
and submitted to the Board of Directors at its next meeting.
(E) The Executive Committee shall advise and superintend all
investments that may be made of the funds of the Company, and shall direct the
disposal of the same, in accordance with such rules and regulations as the Board
of Directors from time to time make.
(F) In the event of a state of disaster of sufficient severity to
prevent the conduct and management of the affairs and business of the Company by
its directors and officers as contemplated by these By-Laws any two available
members of the Executive Committee as constituted immediately prior to such
disaster shall constitute a quorum of that Committee for the full conduct and
management of the affairs and business of the Company in accordance with the
provisions of Article III of these By-Laws; and if less than three members of
the Trust Committee is constituted immediately prior to such disaster shall be
available for the transaction of its business, such Executive Committee shall
also be empowered to exercise all of the powers reserved to the Trust Committee
under Article III Section 2 hereof. In the event of the unavailability, at such
time, of a minimum of two members of such Executive Committee, any three
available directors shall constitute the Executive Committee for the full
conduct and management of the affairs and business of the Company in accordance
with the foregoing provisions of this Section.
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This By-Law shall be subject to implementation by Resolutions of the Board of
Directors presently existing or hereafter passed from time to time for that
purpose, and any provisions of these By-Laws(other than this Section) and any
resolutions which are contrary to the provisions of this Section or to the
provisions of any such implementary Resolutions shall be suspended during such a
disaster period until it shall be determined by any interim Executive Committee
acting under this section that it shall be to the advantage of the Company to
resume the conduct and management of its affairs and business under all of the
other provisions of these By-Laws.
Section 2. Trust Committee
(A) The Trust Committee shall be composed of not more than thirteen
members who shall be selected by the Board of Directors, a majority of whom
shall be members of the Board of Directors and who shall hold office during the
pleasure of the Board.
(B) The Trust Committee shall have general supervision over the Trust
Department and the investment of trust funds, in all matters, however, being
subject to the approval of the Board of Directors.
(C) The Trust Committee shall meet at the principal office of the
Company or elsewhere in its discretion at least once a month. A majority of its
members shall be necessary to constitute a quorum for the transaction of
business. Special meetings of the Trust Committee may be held at any time when
a quorum is present.
(D) Minutes of each meeting of the Trust Committee shall be kept and
promptly submitted to the Board of Directors.
(E) The Trust Committee shall have the power to appoint Committees
and/or designate officers or employees of the Company to whom supervision over
the investment of trust funds may be delegated when the Trust Committee is not
in session.
Section 3. Audit Committee
(A) The Audit Committee shall be composed of five members who shall
be selected by the Board of Directors from its own members, none of whom shall
be an officer of the Company, and shall hold office at the pleasure of the
Board.
(B) The Audit Committee shall have general supervision over the Audit
Division in all matters however subject to the approval of the Board of
Directors; it shall consider all matters brought to its attention by the officer
in
4
<PAGE>
charge of the Audit Division, review all reports of examination of the Company
made by any governmental agency or such independent auditor employed for that
purpose, and make such recommendations to the Board of Directors with respect
thereto or with respect to any other matters pertaining to auditing the Company
as it shall deem desirable.
(C) The Audit Committee shall meet whenever and wherever the majority
of its members shall deem it to be proper for the transaction of its business,
and a majority of its Committee shall constitute a quorum.
Section 4. Compensation Committee
(A) The Compensation Committee shall be composed of not more than
five (5) members who shall be selected by the Board of Directors from its own
members who are not officers of the Company and who shall hold office during the
pleasure of the Board.
(B) The Compensation Committee shall in general advise upon all
matters of policy concerning the Company brought to its attention by the
management and from time to time review the management of the Company, major
organizational matters, including salaries and employee benefits and
specifically shall administer the Executive Incentive Compensation Plan.
(C) Meetings of the Compensation Committee may be called at any time
by the Chairman of the Compensation Committee, the Chairman of the Board of
Directors, or the President of the Company.
Section 5. Associate Directors
(A) Any person who has served as a director may be elected by the
Board of Directors as an associate director, to serve during the pleasure of the
Board.
(B) An associate director shall be entitled to attend all directors
meetings and participate in the discussion of all matters brought to the Board,
with the exception that he would have no right to vote. An associate director
will be eligible for appointment to Committees of the Company, with the
exception of the Executive Committee, Audit Committee and Compensation
Committee, which must be comprised solely of active directors.
Section 6. Absence or Disqualification of Any Member of a Committee
(A) In the absence or disqualification of any member of any Committee
created under Article III of the By-Laws
5
<PAGE>
of this Company, the member or members thereof present at any meeting and not
disqualified from voting, whether or not he or they constitute a quorum, may
unanimously appoint another member of the Board of Directors to act at the
meeting in the place of any such absence or disqualified member.
ARTICLE IV
OFFICERS
Section 1. The Chairman of the Board of Directors shall preside at all
meetings of the Board and shall have such further authority and powers and shall
perform such duties as the Board of Directors may from time to time confer and
direct. He shall also exercise such powers and perform such duties as may from
time to time be agreed upon between himself and the President of the Company.
Section 2. The President shall have the powers and duties pertaining to
the office of the President conferred or imposed upon him by statute or assigned
to him by the Board of Directors in the absence of the Chairman of the Board the
President shall have the powers and duties of the Chairman of the Board.
Section 3. The Chairman of the Board of Directors or the President as
designated by the Board of Directors, shall carry into effect all legal
directions of the Executive Committee and of the Board of Directors, and shall
at all times exercise general supervision over the interest, affairs and
operations of the Company and perform all duties incident to his office.
Section 4. There may be one or more Vice Presidents, however denominated
by the Board of Directors, who may at any time perform all the duties of the
Chairman of the Board of Directors and/or the President and such other powers
and duties as may from time to time be assigned to them by the Board of
Directors, the Executive Committee, the Chairman of the Board or the President
and by the officer in charge of the department or division to which they are
assigned.
Section 5. The Secretary shall attend to the giving of notice of meetings
of the stockholders and the Board of Directors, as well as the Committees
thereof, to the keeping of accurate minutes of all such meetings and to
recording the same in the minute books of the Company. In addition to the other
notice requirements of these By-Laws and as may be practicable under the
circumstances, all such notices shall be in writing and mailed well in advance
of the scheduled date of any other meeting. He shall have custody of the
corporate seal and shall affix the same to any documents requiring such
corporate seal and to attest the same.
6
<PAGE>
Section 6. The Treasurer shall have general supervision over all assets
and liabilities of the Company. He shall be custodian of and responsible for
all monies, funds and valuables of the Company and for the keeping of proper
records of the evidence of property or indebtedness and of all the transactions
of the Company. He shall have general supervision of the expenditures of the
Company and shall report to the Board of Directors at each regular meeting of
the condition of the Company, and perform such other duties as may be assigned
to him from time to time by the Board of Directors of the Executive Committee.
Section 7. There may be a Controller who shall exercise general
supervision over the internal operations of the Company, including accounting,
and shall render to the Board of Directors at appropriate times a report
relating to the general condition and internal operations of the Company.
There may be one or more subordinate accounting or controller officers
however denominated, who may perform the duties of the Controller and such
duties as may be prescribed by the Controller.
Section 8. The officer designated by the Board of Directors to be in
charge of the Audit Division of the Company with such title as the Board of
Directors shall prescribe, shall report to and be directly responsible only to
the Board of Directors.
There shall be an Auditor and there may be one or more Audit Officers,
however denominated, who may perform all the duties of the Auditor and such
duties as may be prescribed by the officer in charge of the Audit Division.
Section 9. There may be one or more officers, subordinate in rank to all
Vice Presidents with such functional titles as shall be determined from time to
time by the Board of Directors, who shall ex officio hold the office Assistant
Secretary of this Company and who may perform such duties as may be prescribed
by the officer in charge of the department or division to whom they are
assigned.
Section 10. The powers and duties of all other officers of the Company
shall be those usually pertaining to their respective offices, subject to the
direction of the Board of Directors, the Executive Committee, Chairman of the
Board of Directors or the President and the officer in charge of the department
or division to which they are assigned.
ARTICLE V
STOCK AND STOCK CERTIFICATES
Section 1. Shares of stock shall be transferrable on the
7
<PAGE>
books of the Company and a transfer book shall be kept in which all transfers of
stock shall be recorded.
Section 2. Certificate of stock shall bear the signature of the
President or any Vice President, however denominated by the Board of Directors
and countersigned by the Secretary or Treasurer or an Assistant Secretary, and
the seal of the corporation shall be engraved thereon. Each certificate shall
recite that the stock represented thereby is transferrable only upon the books
of the Company by the holder thereof or his attorney, upon surrender of the
certificate properly endorsed. Any certificate of stock surrendered to the
Company shall be cancelled at the time of transfer, and before a new certificate
or certificates shall be issued in lieu thereof. Duplicate certificates of
stock shall be issued only upon giving such security as may be satisfactory to
the Board of Directors or the Executive Committee.
Section 3. The Board of Directors of the Company is authorized to fix in
advance a record date for the determination of the stockholders entitled to
notice of, and to vote at, any meeting of stockholders and any adjournment
thereof, or entitled to receive payment of any dividend, or to any allotment or
rights, or to exercise any rights in respect of any change, conversion or
exchange of capital stock, or in connection with obtaining the consent of
stockholders for any purpose, which record date shall not be more than 60 nor
less than 10 days proceeding the date of any meeting of stockholders or the date
for the payment of any dividend, or the date for the allotment of rights, or the
date when any change or conversion or exchange of capital stock shall go into
effect, or a date in connection with obtaining such consent.
ARTICLE VI
SEAL
Section 1. The corporate seal of the Company shall be in the following
form:
Between two concentric circles the words
"Wilmington Trust Company" within the inner
circle the words "Wilmington, Delaware."
8
<PAGE>
ARTICLE VII
FISCAL YEAR
Section 1. The fiscal year of the Company shall be the calendar year.
ARTICLE VIII
EXECUTION OF INSTRUMENTS OF THE COMPANY
Section 1. The Chairman of the Board, the President or any Vice President,
however denominated by the Board of Directors, shall have full power and
authority to enter into, make, sign, execute, acknowledge and/or deliver and the
Secretary or any Assistant Secretary shall have full power and authority to
attest and affix the corporate seal of the Company to any and all deeds,
conveyances, assignments, releases, contracts, agreements, bonds, notes,
mortgages and all other instruments incident to the business of this Company or
in acting as executor, administrator, guardian, trustee, agent or in any other
fiduciary or representative capacity by any and every method of appointment or
by whatever person, corporation, court officer or authority in the State of
Delaware, or elsewhere, without any specific authority, ratification, approval
or confirmation by the Board of Directors or the Executive Committee, and any
and all such instruments shall have the same force and validity as although
expressly authorized by the Board of Directors and/or the Executive Committee.
ARTICLE IX
COMPENSATION OF DIRECTORS AND MEMBERS OF COMMITTEES
Section 1. Directors and associate directors of the Company, other than
salaried officers of the Company, shall be paid such reasonable honoraria or
fees for attending meetings of the Board of Directors as the Board of Directors
may from time to time determine. Directors and associate directors who serve as
members of committees, other than salaried employees of the Company, shall be
paid such reasonable honoraria or fees for services as members of committees as
the Board of Directors shall from time to time determine and directors and
associate directors may be employed by the Company for such special services as
the Board of Directors may from time to time determine and shall be paid for
such special services so performed reasonable compensation as may be determined
by the Board of Directors.
9
<PAGE>
ARTICLE X
INDEMNIFICATION
Section 1. (A) The Corporation shall indemnify and hold harmless, to the
fullest extent permitted by applicable law as it presently exists or may
hereafter be amended, any person who was or is made or is threatened to be made
a party or is otherwise involved in any action, suit or proceeding, whether
civil, criminal, administrative or investigative (a "proceeding") by reason of
the fact that he, or a person for whom he is the legal representative, is or was
a director, officer, employee or agent of the Corporation or is or was serving
at the request of the Corporation as a director, officer, employee, fiduciary or
agent of another corporation or of a partnership, joint venture, trust,
enterprise or non-profit entity, including service with respect to employee
benefit plans, against all liability and loss suffered and expenses reasonably
incurred by such person. The Corporation shall indemnify a person in connection
with a proceeding initiated by such person only if the proceeding was authorized
by the Board of Directors of the Corporation.
(B) The Corporation shall pay the expenses incurred in defending any
proceeding in advance of its final disposition, provided, however, that the
payment of expenses incurred by a Director officer in his capacity as a Director
or officer in advance of the final disposition of the proceeding shall be made
only upon receipt of an undertaking by the Director or officer to repay all
amounts advanced if it should be ultimately determined that the Director or
officer is not entitled to be indemnified under this Article or otherwise.
(C) If a claim for indemnification or payment of expenses, under this
Article X is not paid in full within ninety days after a written claim therefor
has been received by the Corporation the claimant may file suit to recover the
unpaid amount of such claim and, if successful in whole or in part, shall be
entitled to be paid the expense of prosecuting such claim. In any such action
the Corporation shall have the burden of proving that the claimant was not
entitled to the requested indemnification of payment of expenses under
applicable law.
(D) The rights conferred on any person by this Article X shall not be
exclusive of any other rights which such person may have or hereafter acquire
under any statute, provision of the Charter or Act of Incorporation, these By-
Laws, agreement, vote of stockholders or disinterested Directors or otherwise.
(E) Any repeal or modification of the foregoing provisions of this
Article X shall not adversely affect any right or protection hereunder of any
person in respect of any act or omission occurring prior to the time of such
repeal or modification.
10
<PAGE>
ARTICLE XI
AMENDMENTS TO THE BY-LAWS
Section 1. These By-Laws may be altered, amended or repealed, in whole or
in part, and any new By-Law or By-Laws adopted at any regular or special
meeting of the Board of Directors by a vote of the majority of all the members
of the Board of Directors then in office.
I, . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Assistant Secretary of Wilmington Trust Company, do hereby
certify that the foregoing is a true and correct copy of the
By-Laws of the Wilmington Trust Company.
Date . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Assistant Secretary
11
<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: July 17, 1995 By: /s/ Emmett R. Harmon
--------------------------
Name: Emmett R. Harmon
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 March 31, 1995.
------------
<TABLE>
<CAPTION>
ASSETS
Thousands of dollars
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coins............... 224,132
Interest-bearing balances......................................... 0
Held-to-maturity securities............................................. 866,133
Available-for-sale securities........................................... 242,355
Federal funds sold...................................................... 5,000
Securities purchased under agreements to resell......................... 198,831
Loans and lease financing receivables:
Loans and leases, net of unearned income....... 3,207,574
LESS: Allowance for loan and lease losses..... 45,956
LESS: Allocated transfer risk reserve......... 0
Loans and leases, net of unearned income, allowance, and reserve.. 3,161,618
Assets held in trading accounts......................................... 0
Premises and fixed assets (including capitalized leases)................ 69,039
Other real estate owned................................................. 14,430
Investments in unconsolidated subsidiaries and associated companies..... 2,481
Customers' liability to this bank on acceptances outstanding............ 0
Intangible assets....................................................... 4,917
Other assets............................................................ 94,393
Total assets............................................................ 4,883,329
</TABLE>
CONTINUED ON NEXT PAGE
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES
<S> <C>
Deposits:
In domestic offices..................................................... 3,075,750
Noninterest-bearing..................... 595,708
Interest-bearing........................ 2,480,042
Federal funds purchased................................................. 243,700
Securities sold under agreements to repurchase.......................... 230,426
Demand notes issued to the U.S. Treasury................................ 27,650
Trading liabilities..................................................... 0
Other borrowed money:................................................... ///////
With original maturity of one year or less........................ 820,000
With original maturity of more than one year...................... 0
Mortgage indebtedness and obligations under capitalized leases.......... 1,887
Bank's liability on acceptances executed and outstanding................ 0
Subordinated notes and debentures....................................... 0
Other liabilities....................................................... 86,776
Total liabilities....................................................... 4,486,189
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.................................. 334,615
Net unrealized holding gains (losses) on available-for-sale securities.. (93)
Total equity capital.................................................... 397,140
Total liabilities, limited-life preferred stock, and equity capital..... 4,883,329
</TABLE>
We, the undersigned directors, attest to I, David R. Gibson
the correctness of this statement of -------------------
resources and liabilities. We declare Name
that it has been examined by us, and
to the best of our knowledge and belief Senior Vice President
has been prepared in conformance with ---------------------
the instructions and is true and correct. Title
/s/ Richard R. Collins ] of the above-named bank
- ------------------------ ] do hereby declare that
] this Report of Condition
/s/ Carolyn S. Burger ] Directors is true and correct to
- ------------------------ ] the best of my knowledge
] and belief.
/s/ Thomas P. Sweeney ]
- ------------------------ ]
/s/ David R. Gibson
------------------------
Signature
04/27/95
------------------------
2
<PAGE>
Exhibit (25)-2
Commonwealth Edison Company
Form S-3 File No. 33-
================================================================================
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)
Myfanwy P. Bonilla
Assistant Vice President and Trust Counsel
Wilmington Trust Company
Rodney Square North
Wilmington, Delaware 19890
(302) 651-8914
(Name, address and telephone number of agent for service)
COMMONWEALTH EDISON COMPANY
ComEd FINANCING I
(Exact name of obligor as specified in its charter)
Illinois 36-0938600
Delaware Applied For
(State of incorporation) (I.R.S. employer identification no.)
10 South Dearborn Street-37th Floor
Post Office Box 767
Chicago, Illinois 60690-0767
(Address of principal executive offices) (Zip Code)
____ % Subordinated Deferrable Interest Notes due 2035
of Commonwealth Edison Company
(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 Commissioner
Five Penn Center Dover, Delaware
Suite #2901
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. Copy of the 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.
B. Copy of By-Laws of Wilmington Trust Company.
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 17th day of July, 1995.
WILMINGTON TRUST COMPANY
[SEAL]
By: /s/ Emmett R. Harmon
Attest: /s/ Donald G. MacKelcan -------------------------
------------------------ Name: Emmett R. Harmon
Assistant Secretary Title: Vice President
2
<PAGE>
EXHIBIT A
AMENDED CHARTER
WILMINGTON TRUST COMPANY
WILMINGTON, DELAWARE
AS EXISTING ON MAY 9, 1987
<PAGE>
AMENDED CHARTER
OR
ACT OF INCORPORATION
OF
WILMINGTON TRUST COMPANY
WILMINGTON TRUST COMPANY, originally incorporated by an Act of the General
Assembly of the State of Delaware, entitled "An Act to Incorporate the Delaware
Guarantee and Trust Company", approved March 2, A.D. 1901, and the name of which
company was changed to "WILMINGTON TRUST COMPANY" by an amendment filed in the
Office of the Secretary of State on March 18, A.D. 1903, and the Charter or Act
of Incorporation of which company has been from time to time amended and changed
by merger agreements pursuant to the corporation law for state banks and trust
companies of the State of Delaware, does hereby alter and amend its Charter or
Act of Incorporation so that the same as so altered and amended shall in its
entirety read as follows:
FIRST: - The name of this corporation is WILMINGTON TRUST COMPANY.
SECOND: - The location of its principal office in the State of Delaware is
at Rodney Square North, in the City of Wilmington, County of New Castle;
the name of its resident agent is WILMINGTON TRUST COMPANY whose address is
Rodney Square North, in said City. In addition to such principal office,
the said corporation maintains and operates branch offices in the City of
Newark, New Castle County, Delaware, the Town of Newport, New Castle
County, Delaware, at Claymont, New Castle County, Delaware, at Greenville,
New Castle County Delaware, and at Milford Cross Roads, New Castle County,
Delaware, and shall be empowered to open, maintain and operate branch
offices at Ninth and Shipley Streets, 418 Delaware Avenue, 2120 Market
Street, and 3605 Market Street, all in the City of Wilmington, New Castle
County, Delaware, and such other branch offices or places of business as
may be authorized from time to time by the agency or agencies of the
government of the State of Delaware empowered to confer such authority.
THIRD: - (a) The nature of the business and the objects and purposes
proposed to be transacted, promoted or carried on by this Corporation are
to do any or all of the things herein mentioned as fully and to the same
extent as natural persons might or could do and in any part of the world,
viz.:
(1) To sue and be sued, complain and defend in any Court of law or
equity and to make and use a common
<PAGE>
seal, and alter the seal at pleasure, to hold, purchase, convey,
mortgage or otherwise deal in real and personal estate and property,
and to appoint such officers and agents as the business of the
Corporation shall require, to make by-laws not inconsistent with the
Constitution or laws of the United States or of this State, to
discount bills, notes or other evidences of debt, to receive deposits
of money, or securities for money, to buy gold and silver bullion and
foreign coins, to buy and sell bills of exchange, and generally to
use, exercise and enjoy all the powers, rights, privileges and
franchises incident to a corporation which are proper or necessary for
the transaction of the business of the Corporation hereby created.
(2) To insure titles to real and personal property, or any estate or
interests therein, and to guarantee the holder of such property, real
or personal, against any claim or claims, adverse to his interest
therein, and to prepare and give certificates of title for any lands
or premises in the State of Delaware, or elsewhere.
(3) To act as factor, agent, broker or attorney in the receipt,
collection, custody, investment and management of funds, and the
purchase, sale, management and disposal of property of all
descriptions, and to prepare and execute all papers which may be
necessary or proper in such business.
(4) To prepare and draw agreements, contracts, deeds, leases,
conveyances, mortgages, bonds and legal papers of every description,
and to carry on the business of conveyancing in all its branches.
(5) To receive upon deposit for safekeeping money, jewelry, plate,
deeds, bonds and any and all other personal property of every sort and
kind, from executors, administrators, guardians, public officers,
courts, receivers, assignees, trustees, and from all fiduciaries, and
from all other persons and individuals, and from all corporations
whether state, municipal, corporate or private, and to rent boxes,
safes, vaults and other receptacles for such property.
(6) To act as agent or otherwise for the purpose of registering,
issuing, certificating, countersigning, transferring or underwriting
the stock, bonds or other obligations of any corporation, association,
state or municipality, and may receive and manage any sinking fund
therefor on such terms as may be agreed upon between the two parties,
and in like manner may act as Treasurer of any corporation or
municipality.
2
<PAGE>
(7) To act as Trustee under any deed of trust, mortgage, bond or
other instrument issued by any state, municipality, body politic,
corporation, association or person, either alone or in conjunction
with any other person or persons, corporation or corporations.
(8) To guarantee the validity, performance or effect of any contract
or agreement, and the fidelity of persons holding places of
responsibility or trust; to become surety for any person, or persons,
for the faithful performance of any trust, office, duty, contract or
agreement, either by itself or in conjunction with any other person,
or persons, corporation, or corporations, or in like manner become
surety upon any bond, recognizance, obligation, judgment, suit, order,
or decree to be entered in any court of record within the State of
Delaware or elsewhere, or which may now or hereafter be required by
any law, judge, officer or court in the State of Delaware or
elsewhere.
(9) To act by any and every method of appointment as trustee, trustee
in bankruptcy, receiver, assignee, assignee in bankruptcy, executor,
administrator, guardian, bailee, or in any other trust capacity in the
receiving, holding, managing, and disposing of any and all estates and
property, real, personal or mixed, and to be appointed as such
trustee, trustee in bankruptcy, receiver, assignee, assignee in
bankruptcy, executor, administrator, guardian or bailee by any
persons, corporations, court, officer, or authority, in the State of
Delaware or elsewhere; and whenever this Corporation is so appointed
by any person, corporation, court, officer or authority such trustee,
trustee in bankruptcy, receiver, assignee, assignee in bankruptcy,
executor, administrator, guardian, bailee, or in any other trust
capacity, it shall not be required to give bond with surety, but its
capital stock shall be taken and held as security for the performance
of the duties devolving upon it by such appointment.
(10) And for its care, management and trouble, and the exercise of
any of its powers hereby given, or for the performance of any of the
duties which it may undertake or be called upon to perform, or for the
assumption of any responsibility the said Corporation may be entitled
to receive a proper compensation.
(11) To purchase, receive, hold and own bonds, mortgages, debentures,
shares of capital stock, and other securities, obligations, contracts
and evidences of indebtedness, of any private, public or municipal
3
<PAGE>
corporation within and without the State of Delaware, or of the
Government of the United States, or of any state, territory, colony,
or possession thereof, or of any foreign government or country; to
receive, collect, receipt for, and dispose of interest, dividends and
income upon and from any of the bonds, mortgages, debentures, notes,
shares of capital stock, securities, obligations, contracts, evidences
of indebtedness and other property held and owned by it, and to
exercise in respect of all such bonds, mortgages, debentures, notes,
shares of capital stock, securities, obligations, contracts, evidences
of indebtedness and other property, any and all the rights, powers and
privileges of individual owners thereof, including the right to vote
thereon; to invest and deal in and with any of the moneys of the
Corporation upon such securities and in such manner as it may think
fit and proper, and from time to time to vary or realize such
investments; to issue bonds and secure the same by pledges or deeds of
trust or mortgages of or upon the whole or any part of the property
held or owned by the Corporation, and to sell and pledge such bonds,
as and when the Board of Directors shall determine, and in the
promotion of its said corporate business of investment and to the
extent authorized by law, to lease, purchase, hold, sell, assign,
transfer, pledge, mortgage and convey real and personal property of
any name and nature and any estate or interest therein.
(b) In furtherance of, and not in limitation, of the powers conferred by
the laws of the State of Delaware, it is hereby expressly provided that the
said Corporation shall also have the following powers:
(1) To do any or all of the things herein set forth, to the same
extent as natural persons might or could do, and in any part of the
world.
(2) To acquire the good will, rights, property and franchises and to
undertake the whole or any part of the assets and liabilities of any
person, firm, association or corporation, and to pay for the same in
cash, stock of this Corporation, bonds or otherwise; to hold or in any
manner to dispose of the whole or any part of the property so
purchased; to conduct in any lawful manner the whole or any part of
any business so acquired, and to exercise all the powers necessary or
convenient in and about the conduct and management of such business.
(3) To take, hold, own, deal in, mortgage or otherwise lien, and to
lease, sell, exchange, transfer, or in any
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manner whatever dispose of property, real, personal or mixed, wherever
situated.
(4) To enter into, make, perform and carry out contracts of every
kind with any person, firm, association or corporation, and, without
limit as to amount, to draw, make, accept, endorse, discount, execute
and issue promissory notes, drafts, bills of exchange, warrants,
bonds, debentures, and other negotiable or transferable instruments.
(5) To have one or more offices, to carry on all or any of its
operations and businesses, without restriction to the same extent as
natural persons might or could do, to purchase or otherwise acquire,
to hold, own, to mortgage, sell, convey or otherwise dispose of, real
and personal property, of every class and description, in any State,
District, Territory or Colony of the United States, and in any foreign
country or place.
(6) It is the intention that the objects, purposes and powers
specified and clauses contained in this paragraph shall (except where
otherwise expressed in said paragraph) be nowise limited or restricted
by reference to or inference from the terms of any other clause of
this or any other paragraph in this charter, but that the objects,
purposes and powers specified in each of the clauses of this paragraph
shall be regarded as independent objects, purposes and powers.
FOURTH: - (a) The total number of shares of all classes of stock which the
Corporation shall have authority to issue is forty-one million (41,000,000)
shares, consisting of:
(1) One million (1,000,000) shares of Preferred stock, par value
$10.00 per share (hereinafter referred to as "Preferred Stock"); and
(2) Forty million (40,000,000) shares of Common Stock, par value
$1.00 per share (hereinafter referred to as "Common Stock").
(b) Shares of Preferred Stock may be issued from time to time in one or
more series as may from time to time be determined by the Board of
Directors each of said series to be distinctly designated. All shares of
any one series of Preferred Stock shall be alike in every particular,
except that there may be different dates from which dividends, if any,
thereon shall be cumulative, if made cumulative. The voting powers and the
preferences and relative, participating, optional and other special rights
of each
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such series, and the qualifications, limitations or restrictions thereof,
if any, may differ from those of any and all other series at any time
outstanding; and, subject to the provisions of subparagraph 1 of Paragraph
(c) of this Article FOURTH, the Board of Directors of the Corporation is
hereby expressly granted authority to fix by resolution or resolutions
adopted prior to the issuance of any shares of a particular series of
Preferred Stock, the voting powers and the designations, preferences and
relative, optional and other special rights, and the qualifications,
limitations and restrictions of such series, including, but without
limiting the generality of the foregoing, the following:
(1) The distinctive designation of, and the number of shares of
Preferred Stock which shall constitute such series, which number may
be increased (except where otherwise provided by the Board of
Directors) or decreased (but not below the number of shares thereof
then outstanding) from time to time by like action of the Board of
Directors;
(2) The rate and times at which, and the terms and conditions on
which, dividends, if any, on Preferred Stock of such series shall be
paid, the extent of the preference or relation, if any, of such
dividends to the dividends payable on any other class or classes, or
series of the same or other class of stock and whether such dividends
shall be cumulative or non-cumulative;
(3) The right, if any, of the holders of Preferred Stock of such
series to convert the same into or exchange the same for, shares of
any other class or classes or of any series of the same or any other
class or classes of stock of the Corporation and the terms and
conditions of such conversion or exchange;
(4) Whether or not Preferred Stock of such series shall be subject to
redemption, and the redemption price or prices and the time or times
at which, and the terms and conditions on which, Preferred Stock of
such series may be redeemed.
(5) The rights, if any, of the holders of Preferred Stock of such
series upon the voluntary or involuntary liquidation, merger,
consolidation, distribution or sale of assets, dissolution or
winding-up, of the Corporation.
(6) The terms of the sinking fund or redemption or purchase account,
if any, to be provided for the Preferred Stock of such series; and
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(7) The voting powers, if any, of the holders of such series of
Preferred Stock which may, without limiting the generality of the
foregoing include the right, voting as a series or by itself or
together with other series of Preferred Stock or all series of
Preferred Stock as a class, to elect one or more directors of the
Corporation if there shall have been a default in the payment of
dividends on any one or more series of Preferred Stock or under such
circumstances and on such conditions as the Board of Directors may
determine.
(c) (1) After the requirements with respect to preferential dividends on
the Preferred Stock (fixed in accordance with the provisions of section (b)
of this Article FOURTH), if any, shall have been met and after the
Corporation shall have complied with all the requirements, if any, with
respect to the setting aside of sums as sinking funds or redemption or
purchase accounts (fixed in accordance with the provisions of section (b)
of this Article FOURTH), and subject further to any conditions which may be
fixed in accordance with the provisions of section (b) of this Article
FOURTH, then and not otherwise the holders of Common Stock shall be
entitled to receive such dividends as may be declared from time to time by
the Board of Directors.
(2) After distribution in full of the preferential amount, if any,
(fixed in accordance with the provisions of section (b) of this
Article FOURTH), to be distributed to the holders of Preferred Stock
in the event of voluntary or involuntary liquidation, distribution or
sale of assets, dissolution or winding-up, of the Corporation, the
holders of the Common Stock shall be entitled to receive all of the
remaining assets of the Corporation, tangible and intangible, of
whatever kind available for distribution to stockholders ratably in
proportion to the number of shares of Common Stock held by them
respectively.
(3) Except as may otherwise be required by law or by the provisions
of such resolution or resolutions as may be adopted by the Board of
Directors pursuant to section (b) of this Article FOURTH, each holder
of Common Stock shall have one vote in respect of each share of Common
Stock held on all matters voted upon by the stockholders.
(d) No holder of any of the shares of any class or series of stock or of
options, warrants or other rights to purchase shares of any class or series
of stock or of other securities of the Corporation shall have any
preemptive right to purchase or subscribe for any unissued stock of any
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class or series or any additional shares of any class or series to be
issued by reason of any increase of the authorized capital stock of the
Corporation of any class or series, or bonds, certificates of indebtedness,
debentures or other securities convertible into or exchangeable for stock
of the Corporation of any class or series, or carrying any right to
purchase stock of any class or series, but any such unissued stock,
additional authorized issue of shares of any class or series of stock or
securities convertible into or exchangeable for stock, or carrying any
right to purchase stock, may be issued and disposed of pursuant to
resolution of the Board of Directors to such persons, firms, corporations
or associations, whether such holders or others, and upon such terms as may
be deemed advisable by the Board of Directors in the exercise of its sole
discretion.
(e) The relative powers, preferences and rights of each series of
Preferred Stock in relation to the relative powers, preferences and rights
of each other series of Preferred Stock shall, in each case, be as fixed
from time to time by the Board of Directors in the resolution or
resolutions adopted pursuant to authority granted in section (b) of this
Article FOURTH and the consent, by class or series vote or otherwise, of
the holders of such of the series of Preferred Stock as are from time to
time outstanding shall not be required for the issuance by the Board of
Directors of any other series of Preferred Stock whether or not the powers,
preferences and rights of such other series shall be fixed by the Board of
Directors as senior to, or on a parity with, the powers, preferences and
rights of such outstanding series, or any of them; provided, however, that
the Board of Directors may provide in the resolution or resolutions as to
any series of Preferred Stock adopted pursuant to section (b) of this
Article FOURTH that the consent of the holders of a majority (or such
greater proportion as shall be therein fixed) of the outstanding shares of
such series voting thereon shall be required for the issuance of any or all
other series of Preferred Stock.
(f) Subject to the provisions of section (e), shares of any series of
Preferred Stock may be issued from time to time as the Board of Directors
of the Corporation shall determine and on such terms and for such
consideration as shall be fixed by the Board of Directors.
(g) Shares of Common Stock may be issued from time to time as the Board of
Directors of the Corporation shall determine and on such terms and for such
consideration as shall be fixed by the Board of Directors.
8
<PAGE>
(h) The authorized amount of shares of Common Stock and of Preferred Stock
may, without a class or series vote, be increased or decreased from time to
time by the affirmative vote of the holders of a majority of the stock of
the Corporation entitled to vote thereon.
FIFTH: - (a) The business and affairs of the Corporation shall be
conducted and managed by a Board of Directors. The number of directors
constituting the entire Board shall be not less than five nor more than
twenty-five as fixed from time to time by vote of a majority of the whole
Board, provided, however, that the number of directors shall not be reduced
so as to shorten the term of any director at the time in office, and
provided further, that the number of directors constituting the whole Board
shall be twenty-four until otherwise fixed by a majority of the whole
Board.
(b) The Board of Directors shall be divided into three classes, as nearly
equal in number as the then total number of directors constituting the
whole Board permits, with the term of office of one class expiring each
year. At the annual meeting of stockholders in 1982, directors of the
first class shall be elected to hold office for a term expiring at the next
succeeding annual meeting, directors of the second class shall be elected
to hold office for a term expiring at the second succeeding annual meeting
and directors of the third class shall be elected to hold office for a term
expiring at the third succeeding annual meeting. Any vacancies in the
Board of Directors for any reason, and any newly created directorships
resulting from any increase in the directors, may be filled by the Board of
Directors, acting by a majority of the directors then in office, although
less than a quorum, and any directors so chosen shall hold office until the
next annual election of directors. At such election, the stockholders
shall elect a successor to such director to hold office until the next
election of the class for which such director shall have been chosen and
until his successor shall be elected and qualified. No decrease in the
number of directors shall shorten the term of any incumbent director.
(c) Notwithstanding any other provisions of this Charter or Act of
Incorporation or the By-Laws of the Corporation (and notwithstanding the
fact that some lesser percentage may be specified by law, this Charter or
Act of Incorporation or the By-Laws of the Corporation), any director or
the entire Board of Directors of the Corporation may be removed at any time
without cause, but only by the affirmative vote of the holders of two-
thirds or more of the outstanding shares of capital stock of the
Corporation entitled to vote generally in the election of directors
(considered for this purpose as one class) cast at a meeting of the
stockholders called for
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that purpose.
(d) Nominations for the election of directors may be made by the Board of
Directors or by any stockholder entitled to vote for the election of
directors. Such nominations shall be made by notice in writing, delivered
or mailed by first class United States mail, postage prepaid, to the
Secretary of the Corporation not less than 14 days nor more than 50 days
prior to any meeting of the stockholders called for the election of
directors; provided, however, that if less than 21 days' notice of the
meeting is given to stockholders, such written notice shall be delivered or
mailed, as prescribed, to the Secretary of the Corporation not later than
the close of the seventh day following the day on which notice of the
meeting was mailed to stockholders. Notice of nominations which are
proposed by the Board of Directors shall be given by the Chairman on behalf
of the Board.
(e) Each notice under subsection (d) shall set forth (i) the name, age,
business address and, if known, residence address of each nominee proposed
in such notice, (ii) the principal occupation or employment of such nominee
and (iii) the number of shares of stock of the Corporation which are
beneficially owned by each such nominee.
(f) The Chairman of the meeting may, if the facts warrant, determine and
declare to the meeting that a nomination was not made in accordance with
the foregoing procedure, and if he should so determine, he shall so declare
to the meeting and the defective nomination shall be disregarded.
(g) No action required to be taken or which may be taken at any annual or
special meeting of stockholders of the Corporation may be taken without a
meeting, and the power of stockholders to consent in writing, without a
meeting, to the taking of any action is specifically denied.
SIXTH: - The Directors shall choose such officers, agent and servants as
may be provided in the By-Laws as they may from time to time find necessary
or proper.
SEVENTH: - The Corporation hereby created is hereby given the same powers,
rights and privileges as may be conferred upon corporations organized under
the Act entitled "An Act Providing a General Corporation Law", approved
March 10, 1899, as from time to time amended.
EIGHTH: - This Act shall be deemed and taken to be a private Act.
NINTH: - This Corporation is to have perpetual existence.
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TENTH: - The Board of Directors, by resolution passed by a majority of the
whole Board, may designate any of their number to constitute an Executive
Committee, which Committee, to the extent provided in said resolution, or
in the By-Laws of the Company, shall have and may exercise all of the
powers of the Board of Directors in the management of the business and
affairs of the Corporation, and shall have power to authorize the seal of
the Corporation to be affixed to all papers which may require it.
ELEVENTH: - The private property of the stockholders shall not be liable
for the payment of corporate debts to any extent whatever.
TWELFTH: - The Corporation may transact business in any part of the world.
THIRTEENTH: - The Board of Directors of the Corporation is expressly
authorized to make, alter or repeal the By-Laws of the Corporation by a
vote of the majority of the entire Board. The stockholders may make, alter
or repeal any By-Law whether or not adopted by them, provided however, that
any such additional By-Laws, alterations or repeal may be adopted only by
the affirmative vote of the holders of two-thirds or more of the
outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors (considered for this purpose as one
class).
FOURTEENTH: - Meetings of the Directors may be held outside
of the State of Delaware at such places as may be from time to time
designated by the Board, and the Directors may keep the books of the
Company outside of the State of Delaware at such places as may be from time
to time designated by them.
FIFTEENTH: - (a) In addition to any affirmative vote required by law, and
except as otherwise expressly provided in sections (b) and (c) of this
Article FIFTEENTH:
(A) any merger or consolidation of the Corporation or any Subsidiary
(as hereinafter defined) with or into (i) any Interested Stockholder
(as hereinafter defined) or (ii) any other corporation (whether or not
itself an Interested Stockholder), which, after such merger or
consolidation, would be an Affiliate (as hereinafter defined) of an
Interested Stockholder, or
(B) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition (in one transaction or a series of related transactions)
to or with any Interested Stockholder or any Affiliate of any
Interested Stockholder of any assets of the Corporation or any
Subsidiary having an aggregate fair market value
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of $1,000,000 or more, or
(C) the issuance or transfer by the Corporation or any Subsidiary (in
one transaction or a series of related transactions) of any securities
of the Corporation or any Subsidiary to any Interested Stockholder or
any Affiliate of any Interested Stockholder in exchange for cash,
securities or other property (or a combination thereof) having an
aggregate fair market value of $1,000,000 or more, or
(D) the adoption of any plan or proposal for the liquidation or
dissolution of the Corporation, or
(E) any reclassification of securities (including any reverse stock
split), or recapitalization of the Corporation, or any merger or
consolidation of the Corporation with any of its Subsidiaries or any
similar transaction (whether or not with or into or otherwise
involving an Interested Stockholder) which has the effect, directly or
indirectly, of increasing the proportionate share of the outstanding
shares of any class of equity or convertible securities of the
Corporation or any Subsidiary which is directly or indirectly owned by
any Interested Stockholder, or any Affiliate of any Interested
Stockholder,
shall require the affirmative vote of the holders of at least two-thirds of the
outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors, considered for the purpose of this
Article FIFTEENTH as one class ("Voting Shares"). Such affirmative vote shall
be required notwithstanding the fact that no vote may be required, or that some
lesser percentage may be specified, by law or in any agreement with any national
securities exchange or otherwise.
(2) The term "business combination" as used in this Article
FIFTEENTH shall mean any transaction which is referred to any one
or more of clauses (A) through (E) of paragraph 1 of the section
(a).
(b) The provisions of section (a) of this Article FIFTEENTH shall not
be applicable to any particular business combination and such business
combination shall require only such affirmative vote as is required by
law and any other provisions of the Charter or Act of Incorporation of
By-Laws if such business combination has been approved by a majority
of the whole Board.
(c) For the purposes of this Article FIFTEENTH:
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(1) A "person" shall mean any individual firm, corporation or other
entity.
(2) "Interested Stockholder" shall mean, in respect of any business
combination, any person (other than the Corporation or any Subsidiary) who
or which as of the record date for the determination of stockholders
entitled to notice of and to vote on such business combination, or
immediately prior to the consummation of any such transaction:
(A) is the beneficial owner, directly or indirectly, of more than 10%
of the Voting Shares, or
(B) is an Affiliate of the Corporation and at any time within two
years prior thereto was the beneficial owner, directly or indirectly,
of not less than 10% of the then outstanding voting Shares, or
(C) is an assignee of or has otherwise succeeded in any share of
capital stock of the Corporation which were at any time within two
years prior thereto beneficially owned by any Interested Stockholder,
and such assignment or succession shall have occurred in the course of
a transaction or series of transactions not involving a public
offering within the meaning of the Securities Act of 1933.
(3) A person shall be the "beneficial owner" of any Voting Shares:
(A) which such person or any of its Affiliates and Associates (as
hereafter defined) beneficially own, directly or indirectly, or
(B) which such person or any of its Affiliates or Associates has (i)
the right to acquire (whether such right is exercisable immediately or
only after the passage of time), pursuant to any agreement,
arrangement or understanding or upon the exercise of conversion
rights, exchange rights, warrants or options, or otherwise, or (ii)
the right to vote pursuant to any agreement, arrangement or
understanding, or
(C) which are beneficially owned, directly or indirectly, by any
other person with which such first mentioned person or any of its
Affiliates or Associates has any agreement, arrangement or
understanding for the purpose of acquiring, holding, voting or
disposing of any shares of capital stock of the Corporation.
(4) The outstanding Voting Shares shall include shares
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deemed owned through application of paragraph (3) above but shall not
include any other Voting Shares which may be issuable pursuant to any
agreement, or upon exercise of conversion rights, warrants or options or
otherwise.
(5) "Affiliate" and "Associate" shall have the respective meanings given
those terms in Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as in effect on December 31, 1981.
(6) "Subsidiary" shall mean any corporation of which a majority of any
class of equity security (as defined in Rule 3a11-1 of the General Rules
and Regulations under the Securities Exchange Act of 1934, as in effect in
December 31, 1981) is owned, directly or indirectly, by the Corporation;
provided, however, that for the purposes of the definition of Investment
Stockholder set forth in paragraph (2) of this section (c), the term
"Subsidiary" shall mean only a corporation of which a majority of each
class of equity security is owned, directly or indirectly, by the
Corporation.
(d) majority of the directors shall have the power and duty to
determine for the purposes of this Article FIFTEENTH on the basis of
information known to them, (1) the number of Voting Shares
beneficially owned by any person (2) whether a person is an Affiliate
or Associate of another, (3) whether a person has an agreement,
arrangement or understanding with another as to the matters referred
to in paragraph (3) of section (c), or (4) whether the assets subject
to any business combination or the consideration received for the
issuance or transfer of securities by the Corporation, or any
Subsidiary has an aggregate fair market value of $1,00,000 or more.
(e) Nothing contained in this Article FIFTEENTH shall be construed to
relieve any Interested Stockholder from any fiduciary obligation
imposed by law.
SIXTEENTH: Notwithstanding any other provision of this Charter or Act of
Incorporation or the By-Laws of the Corporation (and in addition to any
other vote that may be required by law, this Charter or Act of
Incorporation by the By-Laws), the affirmative vote of the holders of at
least two-thirds of the outstanding shares of the capital stock of the
Corporation entitled to vote generally in the election of directors
(considered for this purpose as one class) shall be required to amend,
alter or repeal any provision of Articles FIFTH, THIRTEENTH, FIFTEENTH or
SIXTEENTH of this Charter or Act of Incorporation.
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SEVENTEENTH: (a) a Director of this Corporation shall not be liable to the
Corporation or its stockholders for monetary damages for breach of
fiduciary duty as a Director, except to the extent such exemption from
liability or limitation thereof is not permitted under the Delaware General
Corporation Laws as the same exists or may hereafter be amended.
(b) Any repeal or modification of the foregoing paragraph shall not
adversely affect any right or protection of a Director of the
Corporation existing hereunder with respect to any act or omission
occurring prior to the time of such repeal or modification."
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I ___________________________________________
_________________ Secretary of WILMINGTON TRUST COMPANY, do
hereby certify that the foregoing is a true and correct copy of
the Charter or Act of Incorporation of WILMINGTON TRUST COMPANY,
as heretofore amended and changed from time to time, copies of
which, certified by the Secretary of the State of Delaware, are
on file in the office of WILMINGTON TRUST COMPANY.
Date __________________
_______________________________________
Secretary
<PAGE>
EXHIBIT B
BY-LAWS
WILMINGTON TRUST COMPANY
WILMINGTON, DELAWARE
AS EXISTING ON FEBRUARY 21, 1991
<PAGE>
BY-LAWS OF WILMINGTON TRUST COMPANY
ARTICLE I
STOCKHOLDERS' MEETINGS
Section 1. The Annual Meeting of Stockholders shall be held on the third
Thursday in April each year at the principal office at the Company or at such
other date, time, or place as may be designated by resolution by the Board of
Directors.
Section 2. Special meetings of all stockholders may be called at any time
by the Board of Directors, the Chairman of the Board or the President.
Section 3. Notice of all meetings of the stockholders shall be given by
mailing to each stockholder at least ten (10 days before said meeting, at his
last known address, a written or printed notice fixing the time and place of
such meeting.
Section 4. A majority in the amount of the capital stock of the Company
issued and outstanding on the record date, as herein determined, shall
constitute a quorum at all meetings of stockholders for the transaction of any
business, but the holders of a small number of shares may adjourn, from time to
time, without further notice, until a quorum is secured. At each annual or
special meeting of stockholders, each stockholder shall be entitled to one vote,
either in person or by proxy, for each shares of stock registered in the
stockholder's name on the books of the Company on the record date for any such
meeting as determined herein.
ARTICLE II
DIRECTORS
Section 1. The number and classification of the Board of Directors shall
be as set forth in the Charter of the Bank.
Section 2. No person who has attained the age of seventy-two (72) years
shall be nominated for election to the Board of Directors of the Company,
provided, however, that this limitation shall not apply to any person who was
serving as director of the Company on September 16, 1971.
Section 3. The class of Directors so elected shall hold office for three
years or until their successors are elected and qualified.
Section 4. The affairs and business of the Company shall be managed and
conducted by the Board of Directors.
Section 5. Regular meetings of the Board of Directors shall
<PAGE>
be held on the third Thursday of each month at the principal office of the
Company, or at such other place and time as may be designated by the Board of
Directors, the Chairman of the Board, or the President.
Section 6. Special meetings of the Board of Directors may be called at any
time by the Chairman of the Board of Directors or by the President, and shall be
called upon the written request of a majority of the directors.
Section 7. A majority of the directors elected and qualified shall be
necessary to constitute a quorum for the transaction of business at any meeting
of the Board of Directors.
Section 8. Written notice shall be sent by mail to each director of any
special meeting of the Board of Directors, and of any change in the time or
place of any regular meeting, stating the time and place of such meeting, which
shall be mailed not less than two days before the time of holding such meeting.
Section 9. In the event of the death, resignation, removal, inability to
act, or disqualification of any director, the Board of Directors, although less
than a quorum, shall have the right to elect the successor who shall hold office
for the remainder of the full term of the class of directors in which the
vacancy occurred, and until such director's successor shall have been duly
elected and qualified.
Section 10. The Board of Directors at its first meeting after its election
by the stockholders shall appoint an Executive Committee, a Trust Committee, an
Audit Committee and a Compensation Committee, and shall elect from its own
members a Chairman of the Board of Directors and a President who may be the same
person. The Board of Directors shall also elect at such meeting a Secretary and
a Treasurer, who may be the same person, may appoint at any time such other
committees and elect or appoint such other officers as it may deem advisable.
The Board of Directors may also elect at such meeting one or more Associate
Directors.
Section 11. The Board of Directors may at any time remove, with or without
cause, any member of any Committee appointed by it or any associate director or
officer elected by it and may appoint or elect his successor.
Section 12. The Board of Directors may designate an officer to be in
charge of such of the departments or division of the Company as it may deem
advisable.
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ARTICLE III
COMMITTEES
Section I. Executive Committee
(A) The Executive Committee shall be composed of not more than nine
members who shall be selected by the Board of Directors from its own members and
who shall hold office during the pleasure of the Board.
(B) The Executive Committee shall have all the powers of the Board of
Directors when it is not in session to transact all business for and in behalf
of the Company that may be brought before it.
(C) The Executive Committee shall meet at the principal office of the
Company or elsewhere in its discretion at least once a week in each week the
Board is not regularly scheduled to meet. A majority of its members shall be
necessary to constitute a quorum for the transaction of business. Special
meetings of the Executive Committee may be held at any time when a quorum is
present.
(D) Minutes of each meeting of the Executive Committee shall be kept
and submitted to the Board of Directors at its next meeting.
(E) The Executive Committee shall advise and superintend all
investments that may be made of the funds of the Company, and shall direct the
disposal of the same, in accordance with such rules and regulations as the Board
of Directors from time to time make.
(F) In the event of a state of disaster of sufficient severity to
prevent the conduct and management of the affairs and business of the Company by
its directors and officers as contemplated by these By-Laws any two available
members of the Executive Committee as constituted immediately prior to such
disaster shall constitute a quorum of that Committee for the full conduct and
management of the affairs and business of the Company in accordance with the
provisions of Article III of these By-Laws; and if less than three members of
the Trust Committee is constituted immediately prior to such disaster shall be
available for the transaction of its business, such Executive Committee shall
also be empowered to exercise all of the powers reserved to the Trust Committee
under Article III Section 2 hereof. In the event of the unavailability, at such
time, of a minimum of two members of such Executive Committee, any three
available directors shall constitute the Executive Committee for the full
conduct and management of the affairs and business of the Company in accordance
with the foregoing provisions of this Section.
3
<PAGE>
This By-Law shall be subject to implementation by Resolutions of the Board of
Directors presently existing or hereafter passed from time to time for that
purpose, and any provisions of these By-Laws(other than this Section) and any
resolutions which are contrary to the provisions of this Section or to the
provisions of any such implementary Resolutions shall be suspended during such a
disaster period until it shall be determined by any interim Executive Committee
acting under this section that it shall be to the advantage of the Company to
resume the conduct and management of its affairs and business under all of the
other provisions of these By-Laws.
Section 2. Trust Committee
(A) The Trust Committee shall be composed of not more than thirteen
members who shall be selected by the Board of Directors, a majority of whom
shall be members of the Board of Directors and who shall hold office during the
pleasure of the Board.
(B) The Trust Committee shall have general supervision over the Trust
Department and the investment of trust funds, in all matters, however, being
subject to the approval of the Board of Directors.
(C) The Trust Committee shall meet at the principal office of the
Company or elsewhere in its discretion at least once a month. A majority of its
members shall be necessary to constitute a quorum for the transaction of
business. Special meetings of the Trust Committee may be held at any time when
a quorum is present.
(D) Minutes of each meeting of the Trust Committee shall be kept and
promptly submitted to the Board of Directors.
(E) The Trust Committee shall have the power to appoint Committees
and/or designate officers or employees of the Company to whom supervision over
the investment of trust funds may be delegated when the Trust Committee is not
in session.
Section 3. Audit Committee
(A) The Audit Committee shall be composed of five members who shall
be selected by the Board of Directors from its own members, none of whom shall
be an officer of the Company, and shall hold office at the pleasure of the
Board.
(B) The Audit Committee shall have general supervision over the Audit
Division in all matters however subject to the approval of the Board of
Directors; it shall consider all matters brought to its attention by the officer
in
4
<PAGE>
charge of the Audit Division, review all reports of examination of the Company
made by any governmental agency or such independent auditor employed for that
purpose, and make such recommendations to the Board of Directors with respect
thereto or with respect to any other matters pertaining to auditing the Company
as it shall deem desirable.
(C) The Audit Committee shall meet whenever and wherever the majority
of its members shall deem it to be proper for the transaction of its business,
and a majority of its Committee shall constitute a quorum.
Section 4. Compensation Committee
(A) The Compensation Committee shall be composed of not more than
five (5) members who shall be selected by the Board of Directors from its own
members who are not officers of the Company and who shall hold office during the
pleasure of the Board.
(B) The Compensation Committee shall in general advise upon all
matters of policy concerning the Company brought to its attention by the
management and from time to time review the management of the Company, major
organizational matters, including salaries and employee benefits and
specifically shall administer the Executive Incentive Compensation Plan.
(C) Meetings of the Compensation Committee may be called at any time
by the Chairman of the Compensation Committee, the Chairman of the Board of
Directors, or the President of the Company.
Section 5. Associate Directors
(A) Any person who has served as a director may be elected by the
Board of Directors as an associate director, to serve during the pleasure of the
Board.
(B) An associate director shall be entitled to attend all directors
meetings and participate in the discussion of all matters brought to the Board,
with the exception that he would have no right to vote. An associate director
will be eligible for appointment to Committees of the Company, with the
exception of the Executive Committee, Audit Committee and Compensation
Committee, which must be comprised solely of active directors.
Section 6. Absence or Disqualification of Any Member of a
Committee
(A) In the absence or disqualification of any member of any Committee
created under Article III of the By-Laws
5
<PAGE>
of this Company, the member or members thereof present at any meeting and not
disqualified from voting, whether or not he or they constitute a quorum, may
unanimously appoint another member of the Board of Directors to act at the
meeting in the place of any such absence or disqualified member.
ARTICLE IV
OFFICERS
Section 1. The Chairman of the Board of Directors shall preside at all
meetings of the Board and shall have such further authority and powers and shall
perform such duties as the Board of Directors may from time to time confer and
direct. He shall also exercise such powers and perform such duties as may from
time to time be agreed upon between himself and the President of the Company.
Section 2. The President shall have the powers and duties pertaining to
the office of the President conferred or imposed upon him by statute or assigned
to him by the Board of Directors in the absence of the Chairman of the Board the
President shall have the powers and duties of the Chairman of the Board.
Section 3. The Chairman of the Board of Directors or the President as
designated by the Board of Directors, shall carry into effect all legal
directions of the Executive Committee and of the Board of Directors, and shall
at all times exercise general supervision over the interest, affairs and
operations of the Company and perform all duties incident to his office.
Section 4. There may be one or more Vice Presidents, however denominated
by the Board of Directors, who may at any time perform all the duties of the
Chairman of the Board of Directors and/or the President and such other powers
and duties as may from time to time be assigned to them by the Board of
Directors, the Executive Committee, the Chairman of the Board or the President
and by the officer in charge of the department or division to which they are
assigned.
Section 5. The Secretary shall attend to the giving of notice of meetings
of the stockholders and the Board of Directors, as well as the Committees
thereof, to the keeping of accurate minutes of all such meetings and to
recording the same in the minute books of the Company. In addition to the other
notice requirements of these By-Laws and as may be practicable under the
circumstances, all such notices shall be in writing and mailed well in advance
of the scheduled date of any other meeting. He shall have custody of the
corporate seal and shall affix the same to any documents requiring such
corporate seal and to attest the same.
6
<PAGE>
Section 6. The Treasurer shall have general supervision over all assets
and liabilities of the Company. He shall be custodian of and responsible for
all monies, funds and valuables of the Company and for the keeping of proper
records of the evidence of property or indebtedness and of all the transactions
of the Company. He shall have general supervision of the expenditures of the
Company and shall report to the Board of Directors at each regular meeting of
the condition of the Company, and perform such other duties as may be assigned
to him from time to time by the Board of Directors of the Executive Committee.
Section 7. There may be a Controller who shall exercise general
supervision over the internal operations of the Company, including accounting,
and shall render to the Board of Directors at appropriate times a report
relating to the general condition and internal operations of the Company.
There may be one or more subordinate accounting or controller officers
however denominated, who may perform the duties of the Controller and such
duties as may be prescribed by the Controller.
Section 8. The officer designated by the Board of Directors to be in
charge of the Audit Division of the Company with such title as the Board of
Directors shall prescribe, shall report to and be directly responsible only to
the Board of Directors.
There shall be an Auditor and there may be one or more Audit Officers,
however denominated, who may perform all the duties of the Auditor and such
duties as may be prescribed by the officer in charge of the Audit Division.
Section 9. There may be one or more officers, subordinate in rank to all
Vice Presidents with such functional titles as shall be determined from time to
time by the Board of Directors, who shall ex officio hold the office Assistant
Secretary of this Company and who may perform such duties as may be prescribed
by the officer in charge of the department or division to whom they are
assigned.
Section 10. The powers and duties of all other officers of the Company
shall be those usually pertaining to their respective offices, subject to the
direction of the Board of Directors, the Executive Committee, Chairman of the
Board of Directors or the President and the officer in charge of the department
or division to which they are assigned.
ARTICLE V
STOCK AND STOCK CERTIFICATES
Section 1. Shares of stock shall be transferrable on the
7
<PAGE>
books of the Company and a transfer book shall be kept in which all transfers of
stock shall be recorded.
Section 2. Certificate of stock shall bear the signature of the
President or any Vice President, however denominated by the Board of Directors
and countersigned by the Secretary or Treasurer or an Assistant Secretary, and
the seal of the corporation shall be engraved thereon. Each certificate shall
recite that the stock represented thereby is transferrable only upon the books
of the Company by the holder thereof or his attorney, upon surrender of the
certificate properly endorsed. Any certificate of stock surrendered to the
Company shall be cancelled at the time of transfer, and before a new certificate
or certificates shall be issued in lieu thereof. Duplicate certificates of
stock shall be issued only upon giving such security as may be satisfactory to
the Board of Directors or the Executive Committee.
Section 3. The Board of Directors of the Company is authorized to fix
in advance a record date for the determination of the stockholders entitled to
notice of, and to vote at, any meeting of stockholders and any adjournment
thereof, or entitled to receive payment of any dividend, or to any allotment or
rights, or to exercise any rights in respect of any change, conversion or
exchange of capital stock, or in connection with obtaining the consent of
stockholders for any purpose, which record date shall not be more than 60 nor
less than 10 days proceeding the date of any meeting of stockholders or the date
for the payment of any dividend, or the date for the allotment of rights, or the
date when any change or conversion or exchange of capital stock shall go into
effect, or a date in connection with obtaining such consent.
ARTICLE VI
SEAL
Section 1. The corporate seal of the Company shall be in the following
form:
Between two concentric circles the words
"Wilmington Trust Company" within the inner
circle the words "Wilmington, Delaware."
8
<PAGE>
ARTICLE VII
FISCAL YEAR
Section 1. The fiscal year of the Company shall be the calendar year.
ARTICLE VIII
EXECUTION OF INSTRUMENTS OF THE COMPANY
Section 1. The Chairman of the Board, the President or any Vice President,
however denominated by the Board of Directors, shall have full power and
authority to enter into, make, sign, execute, acknowledge and/or deliver and the
Secretary or any Assistant Secretary shall have full power and authority to
attest and affix the corporate seal of the Company to any and all deeds,
conveyances, assignments, releases, contracts, agreements, bonds, notes,
mortgages and all other instruments incident to the business of this Company or
in acting as executor, administrator, guardian, trustee, agent or in any other
fiduciary or representative capacity by any and every method of appointment or
by whatever person, corporation, court officer or authority in the State of
Delaware, or elsewhere, without any specific authority, ratification, approval
or confirmation by the Board of Directors or the Executive Committee, and any
and all such instruments shall have the same force and validity as although
expressly authorized by the Board of Directors and/or the Executive Committee.
ARTICLE IX
COMPENSATION OF DIRECTORS AND MEMBERS OF COMMITTEES
Section 1. Directors and associate directors of the Company, other than
salaried officers of the Company, shall be paid such reasonable honoraria or
fees for attending meetings of the Board of Directors as the Board of Directors
may from time to time determine. Directors and associate directors who serve as
members of committees, other than salaried employees of the Company, shall be
paid such reasonable honoraria or fees for services as members of committees as
the Board of Directors shall from time to time determine and directors and
associate directors may be employed by the Company for such special services as
the Board of Directors may from time to time determine and shall be paid for
such special services so performed reasonable compensation as may be determined
by the Board of Directors.
9
<PAGE>
ARTICLE X
INDEMNIFICATION
Section 1. (A) The Corporation shall indemnify and hold harmless, to the
fullest extent permitted by applicable law as it presently exists or may
hereafter be amended, any person who was or is made or is threatened to be made
a party or is otherwise involved in any action, suit or proceeding, whether
civil, criminal, administrative or investigative (a "proceeding") by reason of
the fact that he, or a person for whom he is the legal representative, is or was
a director, officer, employee or agent of the Corporation or is or was serving
at the request of the Corporation as a director, officer, employee, fiduciary or
agent of another corporation or of a partnership, joint venture, trust,
enterprise or non-profit entity, including service with respect to employee
benefit plans, against all liability and loss suffered and expenses reasonably
incurred by such person. The Corporation shall indemnify a person in connection
with a proceeding initiated by such person only if the proceeding was authorized
by the Board of Directors of the Corporation.
(B) The Corporation shall pay the expenses incurred in defending any
proceeding in advance of its final disposition, provided, however, that the
payment of expenses incurred by a Director officer in his capacity as a Director
or officer in advance of the final disposition of the proceeding shall be made
only upon receipt of an undertaking by the Director or officer to repay all
amounts advanced if it should be ultimately determined that the Director or
officer is not entitled to be indemnified under this Article or otherwise.
(C) If a claim for indemnification or payment of expenses, under this
Article X is not paid in full within ninety days after a written claim therefor
has been received by the Corporation the claimant may file suit to recover the
unpaid amount of such claim and, if successful in whole or in part, shall be
entitled to be paid the expense of prosecuting such claim. In any such action
the Corporation shall have the burden of proving that the claimant was not
entitled to the requested indemnification of payment of expenses under
applicable law.
(D) The rights conferred on any person by this Article X shall not be
exclusive of any other rights which such person may have or hereafter acquire
under any statute, provision of the Charter or Act of Incorporation, these By-
Laws, agreement, vote of stockholders or disinterested Directors or otherwise.
(E) Any repeal or modification of the foregoing provisions of this
Article X shall not adversely affect any right or protection hereunder of any
person in respect of any act or omission occurring prior to the time of such
repeal or modification.
10
<PAGE>
ARTICLE XI
AMENDMENTS TO THE BY-LAWS
Section 1. These By-Laws may be altered, amended or repealed, in
whole or in part, and any new By-Law or By-Laws adopted at any regular or
special meeting of the Board of Directors by a vote of the majority of all the
members of the Board of Directors then in office.
I, ........................................................
Assistant Secretary of Wilmington Trust Company, do hereby
certify that the foregoing is a true and correct copy of the
By-Laws of the Wilmington Trust Company.
Date ......................................................
.........................................................
Assistant Secretary
11
<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: July 17, 1995 By: /s/ Emmett R. Harmon
----------------------------
Name: Emmett R. Harmon
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 March 31, 1995.
--------
<TABLE>
<CAPTION>
ASSETS
Thousands of dollars
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coins............... 224,132
Interest-bearing balances......................................... 0
Held-to-maturity securities............................................. 866,133
Available-for-sale securities........................................... 242,355
Federal funds sold...................................................... 5,000
Securities purchased under agreements to resell......................... 198,831
Loans and lease financing receivables:
Loans and leases, net of unearned income............... 3,207,574
LESS: Allowance for loan and lease losses............. 45,956
LESS: Allocated transfer risk reserve................. 0
Loans and leases, net of unearned income, allowance, and reserve.. 3,161,618
Assets held in trading accounts......................................... 0
Premises and fixed assets (including capitalized leases)................ 69,039
Other real estate owned................................................. 14,430
Investments in unconsolidated subsidiaries and associated companies..... 2,481
Customers' liability to this bank on acceptances outstanding............ 0
Intangible assets....................................................... 4,917
Other assets............................................................ 94,393
Total assets............................................................ 4,883,329
</TABLE>
CONTINUED ON NEXT PAGE
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES
<S> <C>
Deposits:
In domestic offices..................................................... 3,075,750
Noninterest-bearing................ 595,708
Interest-bearing................... 2,480,042
Federal funds purchased................................................. 243,700
Securities sold under agreements to repurchase.......................... 230,426
Demand notes issued to the U.S. Treasury................................ 27,650
Trading liabilities..................................................... 0
Other borrowed money:................................................... ///////
With original maturity of one year or less........................ 820,000
With original maturity of more than one year...................... 0
Mortgage indebtedness and obligations under capitalized leases.......... 1,887
Bank's liability on acceptances executed and outstanding................ 0
Subordinated notes and debentures....................................... 0
Other liabilities....................................................... 86,776
Total liabilities....................................................... 4,486,189
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.................................. 334,615
Net unrealized holding gains (losses) on available-for-sale securities.. (93)
Total equity capital.................................................... 397,140
Total liabilities, limited-life preferred stock, and equity capital..... 4,883,329
</TABLE>
We, the undersigned directors, attest to I, David R. Gibson
the correctness of this statement of ---------------------
resources and liabilities. We declare Name
that it has been examined by us, and
to the best of our knowledge and belief Senior Vice President
has been prepared in conformance with ---------------------
the instructions and is true and correct. Title
/s/ Richard R. Collins ] of the above-named bank
- ------------------------ ] do hereby declare that
] this Report of Condition
/s/ Carolyn S. Burger ] Directors is true and correct to
- ------------------------ ] the best of my knowledge
] and belief.
/s/ Thomas P. Sweeney ]
- ------------------------ ] /s/ David R. Gibson
-----------------------
Signature
04/27/95
-----------------------
2
<PAGE>
Exhibit (25)-3
Commonwealth Edison Company
Form S-3 File No. 33-
================================================================================
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)
Myfanwy P. Bonilla
Assistant Vice President and Trust Counsel
Wilmington Trust Company
Rodney Square North
Wilmington, Delaware 19890
(302) 651-8914
(Name, address and telephone number of agent for service)
COMMONWEALTH EDISON COMPANY
ComEd FINANCING I
(Exact name of obligor as specified in its charter)
Illinois 36-0938600
Delaware Applied For
(State of incorporation) (I.R.S. employer identification no.)
10 South Dearborn Street-37th Floor
Post Office Box 767
Chicago, Illinois 60690-0767
(Address of principal executive offices) (Zip Code)
Guarantee of Trust Originated Preferred Securities of
ComEd Financing I by Commonwealth Edison Company
(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 Commissioner
Five Penn Center Dover, Delaware
Suite #2901
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. Copy of the 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.
B. Copy of By-Laws of Wilmington Trust Company.
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 17th day of July, 1995.
WILMINGTON TRUST COMPANY
[SEAL]
By: /s/ Emmett R. Harmon
-------------------------
Attest: /s/ Donald G. MacKelcan Name: Emmett R. Harmon
---------------------------- Title: Vice President
Assistant Secretary
2
<PAGE>
EXHIBIT A
AMENDED CHARTER
WILMINGTON TRUST COMPANY
WILMINGTON, DELAWARE
AS EXISTING ON MAY 9, 1987
<PAGE>
AMENDED CHARTER
OR
ACT OF INCORPORATION
OF
WILMINGTON TRUST COMPANY
WILMINGTON TRUST COMPANY, originally incorporated by an Act of the General
Assembly of the State of Delaware, entitled "An Act to Incorporate the Delaware
Guarantee and Trust Company", approved March 2, A.D. 1901, and the name of which
company was changed to "WILMINGTON TRUST COMPANY" by an amendment filed in the
Office of the Secretary of State on March 18, A.D. 1903, and the Charter or Act
of Incorporation of which company has been from time to time amended and changed
by merger agreements pursuant to the corporation law for state banks and trust
companies of the State of Delaware, does hereby alter and amend its Charter or
Act of Incorporation so that the same as so altered and amended shall in its
entirety read as follows:
FIRST: - The name of this corporation is WILMINGTON TRUST COMPANY.
SECOND: - The location of its principal office in the State of Delaware is
at Rodney Square North, in the City of Wilmington, County of New Castle;
the name of its resident agent is WILMINGTON TRUST COMPANY whose address is
Rodney Square North, in said City. In addition to such principal office,
the said corporation maintains and operates branch offices in the City of
Newark, New Castle County, Delaware, the Town of Newport, New Castle
County, Delaware, at Claymont, New Castle County, Delaware, at Greenville,
New Castle County Delaware, and at Milford Cross Roads, New Castle County,
Delaware, and shall be empowered to open, maintain and operate branch
offices at Ninth and Shipley Streets, 418 Delaware Avenue, 2120 Market
Street, and 3605 Market Street, all in the City of Wilmington, New Castle
County, Delaware, and such other branch offices or places of business as
may be authorized from time to time by the agency or agencies of the
government of the State of Delaware empowered to confer such authority.
THIRD: - (a) The nature of the business and the objects and purposes
proposed to be transacted, promoted or carried on by this Corporation are
to do any or all of the things herein mentioned as fully and to the same
extent as natural persons might or could do and in any part of the world,
viz.:
(1) To sue and be sued, complain and defend in any Court of law or
equity and to make and use a common
<PAGE>
seal, and alter the seal at pleasure, to hold, purchase, convey,
mortgage or otherwise deal in real and personal estate and property,
and to appoint such officers and agents as the business of the
Corporation shall require, to make by-laws not inconsistent with the
Constitution or laws of the United States or of this State, to
discount bills, notes or other evidences of debt, to receive deposits
of money, or securities for money, to buy gold and silver bullion and
foreign coins, to buy and sell bills of exchange, and generally to
use, exercise and enjoy all the powers, rights, privileges and
franchises incident to a corporation which are proper or necessary for
the transaction of the business of the Corporation hereby created.
(2) To insure titles to real and personal property, or any estate or
interests therein, and to guarantee the holder of such property, real
or personal, against any claim or claims, adverse to his interest
therein, and to prepare and give certificates of title for any lands
or premises in the State of Delaware, or elsewhere.
(3) To act as factor, agent, broker or attorney in the receipt,
collection, custody, investment and management of funds, and the
purchase, sale, management and disposal of property of all
descriptions, and to prepare and execute all papers which may be
necessary or proper in such business.
(4) To prepare and draw agreements, contracts, deeds, leases,
conveyances, mortgages, bonds and legal papers of every description,
and to carry on the business of conveyancing in all its branches.
(5) To receive upon deposit for safekeeping money, jewelry, plate,
deeds, bonds and any and all other personal property of every sort and
kind, from executors, administrators, guardians, public officers,
courts, receivers, assignees, trustees, and from all fiduciaries, and
from all other persons and individuals, and from all corporations
whether state, municipal, corporate or private, and to rent boxes,
safes, vaults and other receptacles for such property.
(6) To act as agent or otherwise for the purpose of registering,
issuing, certificating, countersigning, transferring or underwriting
the stock, bonds or other obligations of any corporation, association,
state or municipality, and may receive and manage any sinking fund
therefor on such terms as may be agreed upon between the two parties,
and in like manner may act as Treasurer of any corporation or
municipality.
2
<PAGE>
(7) To act as Trustee under any deed of trust, mortgage, bond or
other instrument issued by any state, municipality, body politic,
corporation, association or person, either alone or in conjunction
with any other person or persons, corporation or corporations.
(8) To guarantee the validity, performance or effect of any contract
or agreement, and the fidelity of persons holding places of
responsibility or trust; to become surety for any person, or persons,
for the faithful performance of any trust, office, duty, contract or
agreement, either by itself or in conjunction with any other person,
or persons, corporation, or corporations, or in like manner become
surety upon any bond, recognizance, obligation, judgment, suit, order,
or decree to be entered in any court of record within the State of
Delaware or elsewhere, or which may now or hereafter be required by
any law, judge, officer or court in the State of Delaware or
elsewhere.
(9) To act by any and every method of appointment as trustee, trustee
in bankruptcy, receiver, assignee, assignee in bankruptcy, executor,
administrator, guardian, bailee, or in any other trust capacity in the
receiving, holding, managing, and disposing of any and all estates and
property, real, personal or mixed, and to be appointed as such
trustee, trustee in bankruptcy, receiver, assignee, assignee in
bankruptcy, executor, administrator, guardian or bailee by any
persons, corporations, court, officer, or authority, in the State of
Delaware or elsewhere; and whenever this Corporation is so appointed
by any person, corporation, court, officer or authority such trustee,
trustee in bankruptcy, receiver, assignee, assignee in bankruptcy,
executor, administrator, guardian, bailee, or in any other trust
capacity, it shall not be required to give bond with surety, but its
capital stock shall be taken and held as security for the performance
of the duties devolving upon it by such appointment.
(10) And for its care, management and trouble, and the exercise of
any of its powers hereby given, or for the performance of any of the
duties which it may undertake or be called upon to perform, or for the
assumption of any responsibility the said Corporation may be entitled
to receive a proper compensation.
(11) To purchase, receive, hold and own bonds, mortgages, debentures,
shares of capital stock, and other securities, obligations, contracts
and evidences of indebtedness, of any private, public or municipal
3
<PAGE>
corporation within and without the State of Delaware, or of the
Government of the United States, or of any state, territory, colony,
or possession thereof, or of any foreign government or country; to
receive, collect, receipt for, and dispose of interest, dividends and
income upon and from any of the bonds, mortgages, debentures, notes,
shares of capital stock, securities, obligations, contracts, evidences
of indebtedness and other property held and owned by it, and to
exercise in respect of all such bonds, mortgages, debentures, notes,
shares of capital stock, securities, obligations, contracts, evidences
of indebtedness and other property, any and all the rights, powers and
privileges of individual owners thereof, including the right to vote
thereon; to invest and deal in and with any of the moneys of the
Corporation upon such securities and in such manner as it may think
fit and proper, and from time to time to vary or realize such
investments; to issue bonds and secure the same by pledges or deeds of
trust or mortgages of or upon the whole or any part of the property
held or owned by the Corporation, and to sell and pledge such bonds,
as and when the Board of Directors shall determine, and in the
promotion of its said corporate business of investment and to the
extent authorized by law, to lease, purchase, hold, sell, assign,
transfer, pledge, mortgage and convey real and personal property of
any name and nature and any estate or interest therein.
(b) In furtherance of, and not in limitation, of the powers conferred by
the laws of the State of Delaware, it is hereby expressly provided that the
said Corporation shall also have the following powers:
(1) To do any or all of the things herein set forth, to the same
extent as natural persons might or could do, and in any part of the
world.
(2) To acquire the good will, rights, property and franchises and to
undertake the whole or any part of the assets and liabilities of any
person, firm, association or corporation, and to pay for the same in
cash, stock of this Corporation, bonds or otherwise; to hold or in any
manner to dispose of the whole or any part of the property so
purchased; to conduct in any lawful manner the whole or any part of
any business so acquired, and to exercise all the powers necessary or
convenient in and about the conduct and management of such business.
(3) To take, hold, own, deal in, mortgage or otherwise lien, and to
lease, sell, exchange, transfer, or in any
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manner whatever dispose of property, real, personal or mixed, wherever
situated.
(4) To enter into, make, perform and carry out contracts of every
kind with any person, firm, association or corporation, and, without
limit as to amount, to draw, make, accept, endorse, discount, execute
and issue promissory notes, drafts, bills of exchange, warrants,
bonds, debentures, and other negotiable or transferable instruments.
(5) To have one or more offices, to carry on all or any of its
operations and businesses, without restriction to the same extent as
natural persons might or could do, to purchase or otherwise acquire,
to hold, own, to mortgage, sell, convey or otherwise dispose of, real
and personal property, of every class and description, in any State,
District, Territory or Colony of the United States, and in any foreign
country or place.
(6) It is the intention that the objects, purposes and powers
specified and clauses contained in this paragraph shall (except where
otherwise expressed in said paragraph) be nowise limited or restricted
by reference to or inference from the terms of any other clause of
this or any other paragraph in this charter, but that the objects,
purposes and powers specified in each of the clauses of this paragraph
shall be regarded as independent objects, purposes and powers.
FOURTH: - (a) The total number of shares of all classes of stock which the
Corporation shall have authority to issue is forty-one million (41,000,000)
shares, consisting of:
(1) One million (1,000,000) shares of Preferred stock, par value
$10.00 per share (hereinafter referred to as "Preferred Stock"); and
(2) Forty million (40,000,000) shares of Common Stock, par value
$1.00 per share (hereinafter referred to as "Common Stock").
(b) Shares of Preferred Stock may be issued from time to time in one or
more series as may from time to time be determined by the Board of
Directors each of said series to be distinctly designated. All shares of
any one series of Preferred Stock shall be alike in every particular,
except that there may be different dates from which dividends, if any,
thereon shall be cumulative, if made cumulative. The voting powers and the
preferences and relative, participating, optional and other special rights
of each
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such series, and the qualifications, limitations or restrictions thereof,
if any, may differ from those of any and all other series at any time
outstanding; and, subject to the provisions of subparagraph 1 of Paragraph
(c) of this Article FOURTH, the Board of Directors of the Corporation is
hereby expressly granted authority to fix by resolution or resolutions
adopted prior to the issuance of any shares of a particular series of
Preferred Stock, the voting powers and the designations, preferences and
relative, optional and other special rights, and the qualifications,
limitations and restrictions of such series, including, but without
limiting the generality of the foregoing, the following:
(1) The distinctive designation of, and the number of shares of
Preferred Stock which shall constitute such series, which number may
be increased (except where otherwise provided by the Board of
Directors) or decreased (but not below the number of shares thereof
then outstanding) from time to time by like action of the Board of
Directors;
(2) The rate and times at which, and the terms and conditions on
which, dividends, if any, on Preferred Stock of such series shall be
paid, the extent of the preference or relation, if any, of such
dividends to the dividends payable on any other class or classes, or
series of the same or other class of stock and whether such dividends
shall be cumulative or non-cumulative;
(3) The right, if any, of the holders of Preferred Stock of such
series to convert the same into or exchange the same for, shares of
any other class or classes or of any series of the same or any other
class or classes of stock of the Corporation and the terms and
conditions of such conversion or exchange;
(4) Whether or not Preferred Stock of such series shall be subject to
redemption, and the redemption price or prices and the time or times
at which, and the terms and conditions on which, Preferred Stock of
such series may be redeemed.
(5) The rights, if any, of the holders of Preferred Stock of such
series upon the voluntary or involuntary liquidation, merger,
consolidation, distribution or sale of assets, dissolution or winding-
up, of the Corporation.
(6) The terms of the sinking fund or redemption or purchase account,
if any, to be provided for the Preferred Stock of such series; and
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(7) The voting powers, if any, of the holders of such series of
Preferred Stock which may, without limiting the generality of the
foregoing include the right, voting as a series or by itself or
together with other series of Preferred Stock or all series of
Preferred Stock as a class, to elect one or more directors of the
Corporation if there shall have been a default in the payment of
dividends on any one or more series of Preferred Stock or under such
circumstances and on such conditions as the Board of Directors may
determine.
(c) (1) After the requirements with respect to preferential dividends on
the Preferred Stock (fixed in accordance with the provisions of section (b)
of this Article FOURTH), if any, shall have been met and after the
Corporation shall have complied with all the requirements, if any, with
respect to the setting aside of sums as sinking funds or redemption or
purchase accounts (fixed in accordance with the provisions of section (b)
of this Article FOURTH), and subject further to any conditions which may be
fixed in accordance with the provisions of section (b) of this Article
FOURTH, then and not otherwise the holders of Common Stock shall be
entitled to receive such dividends as may be declared from time to time by
the Board of Directors.
(2) After distribution in full of the preferential amount, if any,
(fixed in accordance with the provisions of section (b) of this
Article FOURTH), to be distributed to the holders of Preferred Stock
in the event of voluntary or involuntary liquidation, distribution or
sale of assets, dissolution or winding-up, of the Corporation, the
holders of the Common Stock shall be entitled to receive all of the
remaining assets of the Corporation, tangible and intangible, of
whatever kind available for distribution to stockholders ratably in
proportion to the number of shares of Common Stock held by them
respectively.
(3) Except as may otherwise be required by law or by the provisions
of such resolution or resolutions as may be adopted by the Board of
Directors pursuant to section (b) of this Article FOURTH, each holder
of Common Stock shall have one vote in respect of each share of Common
Stock held on all matters voted upon by the stockholders.
(d) No holder of any of the shares of any class or series of stock or of
options, warrants or other rights to purchase shares of any class or series
of stock or of other securities of the Corporation shall have any
preemptive right to purchase or subscribe for any unissued stock of any
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class or series or any additional shares of any class or series to be
issued by reason of any increase of the authorized capital stock of the
Corporation of any class or series, or bonds, certificates of indebtedness,
debentures or other securities convertible into or exchangeable for stock
of the Corporation of any class or series, or carrying any right to
purchase stock of any class or series, but any such unissued stock,
additional authorized issue of shares of any class or series of stock or
securities convertible into or exchangeable for stock, or carrying any
right to purchase stock, may be issued and disposed of pursuant to
resolution of the Board of Directors to such persons, firms, corporations
or associations, whether such holders or others, and upon such terms as may
be deemed advisable by the Board of Directors in the exercise of its sole
discretion.
(e) The relative powers, preferences and rights of each series of
Preferred Stock in relation to the relative powers, preferences and rights
of each other series of Preferred Stock shall, in each case, be as fixed
from time to time by the Board of Directors in the resolution or
resolutions adopted pursuant to authority granted in section (b) of this
Article FOURTH and the consent, by class or series vote or otherwise, of
the holders of such of the series of Preferred Stock as are from time to
time outstanding shall not be required for the issuance by the Board of
Directors of any other series of Preferred Stock whether or not the powers,
preferences and rights of such other series shall be fixed by the Board of
Directors as senior to, or on a parity with, the powers, preferences and
rights of such outstanding series, or any of them; provided, however, that
the Board of Directors may provide in the resolution or resolutions as to
any series of Preferred Stock adopted pursuant to section (b) of this
Article FOURTH that the consent of the holders of a majority (or such
greater proportion as shall be therein fixed) of the outstanding shares of
such series voting thereon shall be required for the issuance of any or all
other series of Preferred Stock.
(f) Subject to the provisions of section (e), shares of any series of
Preferred Stock may be issued from time to time as the Board of Directors
of the Corporation shall determine and on such terms and for such
consideration as shall be fixed by the Board of Directors.
(g) Shares of Common Stock may be issued from time to time as the Board of
Directors of the Corporation shall determine and on such terms and for such
consideration as shall be fixed by the Board of Directors.
8
<PAGE>
(h) The authorized amount of shares of Common Stock and of Preferred Stock
may, without a class or series vote, be increased or decreased from time to
time by the affirmative vote of the holders of a majority of the stock of
the Corporation entitled to vote thereon.
FIFTH: - (a) The business and affairs of the Corporation shall be
conducted and managed by a Board of Directors. The number of directors
constituting the entire Board shall be not less than five nor more than
twenty-five as fixed from time to time by vote of a majority of the whole
Board, provided, however, that the number of directors shall not be reduced
so as to shorten the term of any director at the time in office, and
provided further, that the number of directors constituting the whole Board
shall be twenty-four until otherwise fixed by a majority of the whole
Board.
(b) The Board of Directors shall be divided into three classes, as nearly
equal in number as the then total number of directors constituting the
whole Board permits, with the term of office of one class expiring each
year. At the annual meeting of stockholders in 1982, directors of the
first class shall be elected to hold office for a term expiring at the next
succeeding annual meeting, directors of the second class shall be elected
to hold office for a term expiring at the second succeeding annual meeting
and directors of the third class shall be elected to hold office for a term
expiring at the third succeeding annual meeting. Any vacancies in the
Board of Directors for any reason, and any newly created directorships
resulting from any increase in the directors, may be filled by the Board of
Directors, acting by a majority of the directors then in office, although
less than a quorum, and any directors so chosen shall hold office until the
next annual election of directors. At such election, the stockholders
shall elect a successor to such director to hold office until the next
election of the class for which such director shall have been chosen and
until his successor shall be elected and qualified. No decrease in the
number of directors shall shorten the term of any incumbent director.
(c) Notwithstanding any other provisions of this Charter or Act of
Incorporation or the By-Laws of the Corporation (and notwithstanding the
fact that some lesser percentage may be specified by law, this Charter or
Act of Incorporation or the By-Laws of the Corporation), any director or
the entire Board of Directors of the Corporation may be removed at any time
without cause, but only by the affirmative vote of the holders of two-
thirds or more of the outstanding shares of capital stock of the
Corporation entitled to vote generally in the election of directors
(considered for this purpose as one class) cast at a meeting of the
stockholders called for
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that purpose.
(d) Nominations for the election of directors may be made by the Board of
Directors or by any stockholder entitled to vote for the election of
directors. Such nominations shall be made by notice in writing, delivered
or mailed by first class United States mail, postage prepaid, to the
Secretary of the Corporation not less than 14 days nor more than 50 days
prior to any meeting of the stockholders called for the election of
directors; provided, however, that if less than 21 days' notice of the
meeting is given to stockholders, such written notice shall be delivered or
mailed, as prescribed, to the Secretary of the Corporation not later than
the close of the seventh day following the day on which notice of the
meeting was mailed to stockholders. Notice of nominations which are
proposed by the Board of Directors shall be given by the Chairman on behalf
of the Board.
(e) Each notice under subsection (d) shall set forth (i) the name, age,
business address and, if known, residence address of each nominee proposed
in such notice, (ii) the principal occupation or employment of such nominee
and (iii) the number of shares of stock of the Corporation which are
beneficially owned by each such nominee.
(f) The Chairman of the meeting may, if the facts warrant, determine and
declare to the meeting that a nomination was not made in accordance with
the foregoing procedure, and if he should so determine, he shall so declare
to the meeting and the defective nomination shall be disregarded.
(g) No action required to be taken or which may be taken at any annual or
special meeting of stockholders of the Corporation may be taken without a
meeting, and the power of stockholders to consent in writing, without a
meeting, to the taking of any action is specifically denied.
SIXTH: - The Directors shall choose such officers, agent and servants as
may be provided in the By-Laws as they may from time to time find necessary
or proper.
SEVENTH: - The Corporation hereby created is hereby given the same powers,
rights and privileges as may be conferred upon corporations organized under
the Act entitled "An Act Providing a General Corporation Law", approved
March 10, 1899, as from time to time amended.
EIGHTH: - This Act shall be deemed and taken to be a private Act.
NINTH: - This Corporation is to have perpetual existence.
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TENTH: - The Board of Directors, by resolution passed by a majority of the
whole Board, may designate any of their number to constitute an Executive
Committee, which Committee, to the extent provided in said resolution, or
in the By-Laws of the Company, shall have and may exercise all of the
powers of the Board of Directors in the management of the business and
affairs of the Corporation, and shall have power to authorize the seal of
the Corporation to be affixed to all papers which may require it.
ELEVENTH: - The private property of the stockholders shall not be liable
for the payment of corporate debts to any extent whatever.
TWELFTH: - The Corporation may transact business in any part of the world.
THIRTEENTH: - The Board of Directors of the Corporation is expressly
authorized to make, alter or repeal the By-Laws of the Corporation by a
vote of the majority of the entire Board. The stockholders may make, alter
or repeal any By-Law whether or not adopted by them, provided however, that
any such additional By-Laws, alterations or repeal may be adopted only by
the affirmative vote of the holders of two-thirds or more of the
outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors (considered for this purpose as one
class).
FOURTEENTH: - Meetings of the Directors may be held outside of the State of
Delaware at such places as may be from time to time designated by the
Board, and the Directors may keep the books of the Company outside of the
State of Delaware at such places as may be from time to time designated by
them.
FIFTEENTH: - (a) In addition to any affirmative vote required by law, and
except as otherwise expressly provided in sections (b) and (c) of this
Article FIFTEENTH:
(A) any merger or consolidation of the Corporation or any Subsidiary
(as hereinafter defined) with or into (i) any Interested Stockholder
(as hereinafter defined) or (ii) any other corporation (whether or not
itself an Interested Stockholder), which, after such merger or
consolidation, would be an Affiliate (as hereinafter defined) of an
Interested Stockholder, or
(B) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition (in one transaction or a series of related transactions)
to or with any Interested Stockholder or any Affiliate of any
Interested Stockholder of any assets of the Corporation or any
Subsidiary having an aggregate fair market value
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of $1,000,000 or more, or
(C) the issuance or transfer by the Corporation or any Subsidiary (in
one transaction or a series of related transactions) of any securities
of the Corporation or any Subsidiary to any Interested Stockholder or
any Affiliate of any Interested Stockholder in exchange for cash,
securities or other property (or a combination thereof) having an
aggregate fair market value of $1,000,000 or more, or
(D) the adoption of any plan or proposal for the liquidation or
dissolution of the Corporation, or
(E) any reclassification of securities (including any reverse stock
split), or recapitalization of the Corporation, or any merger or
consolidation of the Corporation with any of its Subsidiaries or any
similar transaction (whether or not with or into or otherwise
involving an Interested Stockholder) which has the effect, directly or
indirectly, of increasing the proportionate share of the outstanding
shares of any class of equity or convertible securities of the
Corporation or any Subsidiary which is directly or indirectly owned by
any Interested Stockholder, or any Affiliate of any Interested
Stockholder,
shall require the affirmative vote of the holders of at least two-thirds of the
outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors, considered for the purpose of this
Article FIFTEENTH as one class ("Voting Shares"). Such affirmative vote shall
be required notwithstanding the fact that no vote may be required, or that some
lesser percentage may be specified, by law or in any agreement with any national
securities exchange or otherwise.
(2) The term "business combination" as used in this Article
FIFTEENTH shall mean any transaction which is referred to any one
or more of clauses (A) through (E) of paragraph 1 of the section
(a).
(b) The provisions of section (a) of this Article FIFTEENTH shall not
be applicable to any particular business combination and such business
combination shall require only such affirmative vote as is required by
law and any other provisions of the Charter or Act of Incorporation of
By-Laws if such business combination has been approved by a majority
of the whole Board.
(c) For the purposes of this Article FIFTEENTH:
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(1) A "person" shall mean any individual firm, corporation or other
entity.
(2) "Interested Stockholder" shall mean, in respect of any business
combination, any person (other than the Corporation or any Subsidiary) who
or which as of the record date for the determination of stockholders
entitled to notice of and to vote on such business combination, or
immediately prior to the consummation of any such transaction:
(A) is the beneficial owner, directly or indirectly, of more than 10%
of the Voting Shares, or
(B) is an Affiliate of the Corporation and at any time within two
years prior thereto was the beneficial owner, directly or indirectly,
of not less than 10% of the then outstanding voting Shares, or
(C) is an assignee of or has otherwise succeeded in any share of
capital stock of the Corporation which were at any time within two
years prior thereto beneficially owned by any Interested Stockholder,
and such assignment or succession shall have occurred in the course of
a transaction or series of transactions not involving a public
offering within the meaning of the Securities Act of 1933.
(3) A person shall be the "beneficial owner" of any Voting Shares:
(A) which such person or any of its Affiliates and Associates (as
hereafter defined) beneficially own, directly or indirectly, or
(B) which such person or any of its Affiliates or Associates has (i)
the right to acquire (whether such right is exercisable immediately or
only after the passage of time), pursuant to any agreement,
arrangement or understanding or upon the exercise of conversion
rights, exchange rights, warrants or options, or otherwise, or (ii)
the right to vote pursuant to any agreement, arrangement or
understanding, or
(C) which are beneficially owned, directly or indirectly, by any
other person with which such first mentioned person or any of its
Affiliates or Associates has any agreement, arrangement or
understanding for the purpose of acquiring, holding, voting or
disposing of any shares of capital stock of the Corporation.
(4) The outstanding Voting Shares shall include shares
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deemed owned through application of paragraph (3) above but shall not
include any other Voting Shares which may be issuable pursuant to any
agreement, or upon exercise of conversion rights, warrants or options or
otherwise.
(5) "Affiliate" and "Associate" shall have the respective meanings given
those terms in Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as in effect on December 31, 1981.
(6) "Subsidiary" shall mean any corporation of which a majority of any
class of equity security (as defined in Rule 3a11-1 of the General Rules
and Regulations under the Securities Exchange Act of 1934, as in effect in
December 31, 1981) is owned, directly or indirectly, by the Corporation;
provided, however, that for the purposes of the definition of Investment
Stockholder set forth in paragraph (2) of this section (c), the term
"Subsidiary" shall mean only a corporation of which a majority of each
class of equity security is owned, directly or indirectly, by the
Corporation.
(d) majority of the directors shall have the power and duty to
determine for the purposes of this Article FIFTEENTH on the basis of
information known to them, (1) the number of Voting Shares
beneficially owned by any person (2) whether a person is an Affiliate
or Associate of another, (3) whether a person has an agreement,
arrangement or understanding with another as to the matters referred
to in paragraph (3) of section (c), or (4) whether the assets subject
to any business combination or the consideration received for the
issuance or transfer of securities by the Corporation, or any
Subsidiary has an aggregate fair market value of $1,00,000 or more.
(e) Nothing contained in this Article FIFTEENTH shall be construed to
relieve any Interested Stockholder from any fiduciary obligation
imposed by law.
SIXTEENTH: Notwithstanding any other provision of this Charter or Act of
Incorporation or the By-Laws of the Corporation (and in addition to any
other vote that may be required by law, this Charter or Act of
Incorporation by the By-Laws), the affirmative vote of the holders of at
least two-thirds of the outstanding shares of the capital stock of the
Corporation entitled to vote generally in the election of directors
(considered for this purpose as one class) shall be required to amend,
alter or repeal any provision of Articles FIFTH, THIRTEENTH, FIFTEENTH or
SIXTEENTH of this Charter or Act of Incorporation.
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SEVENTEENTH: (a) a Director of this Corporation shall not be liable to the
Corporation or its stockholders for monetary damages for breach of
fiduciary duty as a Director, except to the extent such exemption from
liability or limitation thereof is not permitted under the Delaware General
Corporation Laws as the same exists or may hereafter be amended.
(b) Any repeal or modification of the foregoing paragraph shall not
adversely affect any right or protection of a Director of the
Corporation existing hereunder with respect to any act or omission
occurring prior to the time of such repeal or modification."
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I ___________________________________________
_________________ Secretary of WILMINGTON TRUST COMPANY, do
hereby certify that the foregoing is a true and correct copy of
the Charter or Act of Incorporation of WILMINGTON TRUST COMPANY,
as heretofore amended and changed from time to time, copies of
which, certified by the Secretary of the State of Delaware, are
on file in the office of WILMINGTON TRUST COMPANY.
Date __________________
_______________________________________
Secretary
<PAGE>
EXHIBIT B
BY-LAWS
WILMINGTON TRUST COMPANY
WILMINGTON, DELAWARE
AS EXISTING ON FEBRUARY 21, 1991
<PAGE>
BY-LAWS OF WILMINGTON TRUST COMPANY
ARTICLE I
STOCKHOLDERS' MEETINGS
Section 1. The Annual Meeting of Stockholders shall be held on the third
Thursday in April each year at the principal office at the Company or at such
other date, time, or place as may be designated by resolution by the Board of
Directors.
Section 2. Special meetings of all stockholders may be called at any time
by the Board of Directors, the Chairman of the Board or the President.
Section 3. Notice of all meetings of the stockholders shall be given by
mailing to each stockholder at least ten (10 days before said meeting, at his
last known address, a written or printed notice fixing the time and place of
such meeting.
Section 4. A majority in the amount of the capital stock of the Company
issued and outstanding on the record date, as herein determined, shall
constitute a quorum at all meetings of stockholders for the transaction of any
business, but the holders of a small number of shares may adjourn, from time to
time, without further notice, until a quorum is secured. At each annual or
special meeting of stockholders, each stockholder shall be entitled to one vote,
either in person or by proxy, for each shares of stock registered in the
stockholder's name on the books of the Company on the record date for any such
meeting as determined herein.
ARTICLE II
DIRECTORS
Section 1. The number and classification of the Board of Directors shall
be as set forth in the Charter of the Bank.
Section 2. No person who has attained the age of seventy-two (72) years
shall be nominated for election to the Board of Directors of the Company,
provided, however, that this limitation shall not apply to any person who was
serving as director of the Company on September 16, 1971.
Section 3. The class of Directors so elected shall hold office for three
years or until their successors are elected and qualified.
Section 4. The affairs and business of the Company shall be managed and
conducted by the Board of Directors.
Section 5. Regular meetings of the Board of Directors shall
<PAGE>
be held on the third Thursday of each month at the principal office of the
Company, or at such other place and time as may be designated by the Board of
Directors, the Chairman of the Board, or the President.
Section 6. Special meetings of the Board of Directors may be called at any
time by the Chairman of the Board of Directors or by the President, and shall be
called upon the written request of a majority of the directors.
Section 7. A majority of the directors elected and qualified shall be
necessary to constitute a quorum for the transaction of business at any meeting
of the Board of Directors.
Section 8. Written notice shall be sent by mail to each director of any
special meeting of the Board of Directors, and of any change in the time or
place of any regular meeting, stating the time and place of such meeting, which
shall be mailed not less than two days before the time of holding such meeting.
Section 9. In the event of the death, resignation, removal, inability to
act, or disqualification of any director, the Board of Directors, although less
than a quorum, shall have the right to elect the successor who shall hold office
for the remainder of the full term of the class of directors in which the
vacancy occurred, and until such director's successor shall have been duly
elected and qualified.
Section 10. The Board of Directors at its first meeting after its election
by the stockholders shall appoint an Executive Committee, a Trust Committee, an
Audit Committee and a Compensation Committee, and shall elect from its own
members a Chairman of the Board of Directors and a President who may be the same
person. The Board of Directors shall also elect at such meeting a Secretary and
a Treasurer, who may be the same person, may appoint at any time such other
committees and elect or appoint such other officers as it may deem advisable.
The Board of Directors may also elect at such meeting one or more Associate
Directors.
Section 11. The Board of Directors may at any time remove, with or without
cause, any member of any Committee appointed by it or any associate director or
officer elected by it and may appoint or elect his successor.
Section 12. The Board of Directors may designate an officer to be in
charge of such of the departments or division of the Company as it may deem
advisable.
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ARTICLE III
COMMITTEES
Section I. Executive Committee
(A) The Executive Committee shall be composed of not more than nine
members who shall be selected by the Board of Directors from its own members and
who shall hold office during the pleasure of the Board.
(B) The Executive Committee shall have all the powers of the Board of
Directors when it is not in session to transact all business for and in behalf
of the Company that may be brought before it.
(C) The Executive Committee shall meet at the principal office of the
Company or elsewhere in its discretion at least once a week in each week the
Board is not regularly scheduled to meet. A majority of its members shall be
necessary to constitute a quorum for the transaction of business. Special
meetings of the Executive Committee may be held at any time when a quorum is
present.
(D) Minutes of each meeting of the Executive Committee shall be kept
and submitted to the Board of Directors at its next meeting.
(E) The Executive Committee shall advise and superintend all
investments that may be made of the funds of the Company, and shall direct the
disposal of the same, in accordance with such rules and regulations as the Board
of Directors from time to time make.
(F) In the event of a state of disaster of sufficient severity to
prevent the conduct and management of the affairs and business of the Company by
its directors and officers as contemplated by these By-Laws any two available
members of the Executive Committee as constituted immediately prior to such
disaster shall constitute a quorum of that Committee for the full conduct and
management of the affairs and business of the Company in accordance with the
provisions of Article III of these By-Laws; and if less than three members of
the Trust Committee is constituted immediately prior to such disaster shall be
available for the transaction of its business, such Executive Committee shall
also be empowered to exercise all of the powers reserved to the Trust Committee
under Article III Section 2 hereof. In the event of the unavailability, at such
time, of a minimum of two members of such Executive Committee, any three
available directors shall constitute the Executive Committee for the full
conduct and management of the affairs and business of the Company in accordance
with the foregoing provisions of this Section.
3
<PAGE>
This By-Law shall be subject to implementation by Resolutions of the Board of
Directors presently existing or hereafter passed from time to time for that
purpose, and any provisions of these By-Laws(other than this Section) and any
resolutions which are contrary to the provisions of this Section or to the
provisions of any such implementary Resolutions shall be suspended during such a
disaster period until it shall be determined by any interim Executive Committee
acting under this section that it shall be to the advantage of the Company to
resume the conduct and management of its affairs and business under all of the
other provisions of these By-Laws.
Section 2. Trust Committee
(A) The Trust Committee shall be composed of not more than thirteen
members who shall be selected by the Board of Directors, a majority of whom
shall be members of the Board of Directors and who shall hold office during the
pleasure of the Board.
(B) The Trust Committee shall have general supervision over the Trust
Department and the investment of trust funds, in all matters, however, being
subject to the approval of the Board of Directors.
(C) The Trust Committee shall meet at the principal office of the
Company or elsewhere in its discretion at least once a month. A majority of its
members shall be necessary to constitute a quorum for the transaction of
business. Special meetings of the Trust Committee may be held at any time when
a quorum is present.
(D) Minutes of each meeting of the Trust Committee shall be kept and
promptly submitted to the Board of Directors.
(E) The Trust Committee shall have the power to appoint Committees
and/or designate officers or employees of the Company to whom supervision over
the investment of trust funds may be delegated when the Trust Committee is not
in session.
Section 3. Audit Committee
(A) The Audit Committee shall be composed of five members who shall
be selected by the Board of Directors from its own members, none of whom shall
be an officer of the Company, and shall hold office at the pleasure of the
Board.
(B) The Audit Committee shall have general supervision over the Audit
Division in all matters however subject to the approval of the Board of
Directors; it shall consider all matters brought to its attention by the officer
in
4
<PAGE>
charge of the Audit Division, review all reports of examination of the Company
made by any governmental agency or such independent auditor employed for that
purpose, and make such recommendations to the Board of Directors with respect
thereto or with respect to any other matters pertaining to auditing the Company
as it shall deem desirable.
(C) The Audit Committee shall meet whenever and wherever the majority
of its members shall deem it to be proper for the transaction of its business,
and a majority of its Committee shall constitute a quorum.
Section 4. Compensation Committee
(A) The Compensation Committee shall be composed of not more than
five (5) members who shall be selected by the Board of Directors from its own
members who are not officers of the Company and who shall hold office during the
pleasure of the Board.
(B) The Compensation Committee shall in general advise upon all
matters of policy concerning the Company brought to its attention by the
management and from time to time review the management of the Company, major
organizational matters, including salaries and employee benefits and
specifically shall administer the Executive Incentive Compensation Plan.
(C) Meetings of the Compensation Committee may be called at any time
by the Chairman of the Compensation Committee, the Chairman of the Board of
Directors, or the President of the Company.
Section 5. Associate Directors
(A) Any person who has served as a director may be elected by the
Board of Directors as an associate director, to serve during the pleasure of the
Board.
(B) An associate director shall be entitled to attend all directors
meetings and participate in the discussion of all matters brought to the Board,
with the exception that he would have no right to vote. An associate director
will be eligible for appointment to Committees of the Company, with the
exception of the Executive Committee, Audit Committee and Compensation
Committee, which must be comprised solely of active directors.
Section 6. Absence or Disqualification of Any Member of a Committee
(A) In the absence or disqualification of any member of any Committee
created under Article III of the By-Laws
5
<PAGE>
of this Company, the member or members thereof present at any meeting and not
disqualified from voting, whether or not he or they constitute a quorum, may
unanimously appoint another member of the Board of Directors to act at the
meeting in the place of any such absence or disqualified member.
ARTICLE IV
OFFICERS
Section 1. The Chairman of the Board of Directors shall preside at all
meetings of the Board and shall have such further authority and powers and shall
perform such duties as the Board of Directors may from time to time confer and
direct. He shall also exercise such powers and perform such duties as may from
time to time be agreed upon between himself and the President of the Company.
Section 2. The President shall have the powers and duties pertaining to
the office of the President conferred or imposed upon him by statute or assigned
to him by the Board of Directors in the absence of the Chairman of the Board the
President shall have the powers and duties of the Chairman of the Board.
Section 3. The Chairman of the Board of Directors or the President as
designated by the Board of Directors, shall carry into effect all legal
directions of the Executive Committee and of the Board of Directors, and shall
at all times exercise general supervision over the interest, affairs and
operations of the Company and perform all duties incident to his office.
Section 4. There may be one or more Vice Presidents, however denominated
by the Board of Directors, who may at any time perform all the duties of the
Chairman of the Board of Directors and/or the President and such other powers
and duties as may from time to time be assigned to them by the Board of
Directors, the Executive Committee, the Chairman of the Board or the President
and by the officer in charge of the department or division to which they are
assigned.
Section 5. The Secretary shall attend to the giving of notice of meetings
of the stockholders and the Board of Directors, as well as the Committees
thereof, to the keeping of accurate minutes of all such meetings and to
recording the same in the minute books of the Company. In addition to the other
notice requirements of these By-Laws and as may be practicable under the
circumstances, all such notices shall be in writing and mailed well in advance
of the scheduled date of any other meeting. He shall have custody of the
corporate seal and shall affix the same to any documents requiring such
corporate seal and to attest the same.
6
<PAGE>
Section 6. The Treasurer shall have general supervision over all assets
and liabilities of the Company. He shall be custodian of and responsible for
all monies, funds and valuables of the Company and for the keeping of proper
records of the evidence of property or indebtedness and of all the transactions
of the Company. He shall have general supervision of the expenditures of the
Company and shall report to the Board of Directors at each regular meeting of
the condition of the Company, and perform such other duties as may be assigned
to him from time to time by the Board of Directors of the Executive Committee.
Section 7. There may be a Controller who shall exercise general
supervision over the internal operations of the Company, including accounting,
and shall render to the Board of Directors at appropriate times a report
relating to the general condition and internal operations of the Company.
There may be one or more subordinate accounting or controller officers
however denominated, who may perform the duties of the Controller and such
duties as may be prescribed by the Controller.
Section 8. The officer designated by the Board of Directors to be in
charge of the Audit Division of the Company with such title as the Board of
Directors shall prescribe, shall report to and be directly responsible only to
the Board of Directors.
There shall be an Auditor and there may be one or more Audit Officers,
however denominated, who may perform all the duties of the Auditor and such
duties as may be prescribed by the officer in charge of the Audit Division.
Section 9. There may be one or more officers, subordinate in rank to all
Vice Presidents with such functional titles as shall be determined from time to
time by the Board of Directors, who shall ex officio hold the office Assistant
Secretary of this Company and who may perform such duties as may be prescribed
by the officer in charge of the department or division to whom they are
assigned.
Section 10. The powers and duties of all other officers of the Company
shall be those usually pertaining to their respective offices, subject to the
direction of the Board of Directors, the Executive Committee, Chairman of the
Board of Directors or the President and the officer in charge of the department
or division to which they are assigned.
ARTICLE V
STOCK AND STOCK CERTIFICATES
Section 1. Shares of stock shall be transferrable on the
7
<PAGE>
books of the Company and a transfer book shall be kept in which all transfers of
stock shall be recorded.
Section 2. Certificate of stock shall bear the signature of the
President or any Vice President, however denominated by the Board of Directors
and countersigned by the Secretary or Treasurer or an Assistant Secretary, and
the seal of the corporation shall be engraved thereon. Each certificate shall
recite that the stock represented thereby is transferrable only upon the books
of the Company by the holder thereof or his attorney, upon surrender of the
certificate properly endorsed. Any certificate of stock surrendered to the
Company shall be cancelled at the time of transfer, and before a new certificate
or certificates shall be issued in lieu thereof. Duplicate certificates of
stock shall be issued only upon giving such security as may be satisfactory to
the Board of Directors or the Executive Committee.
Section 3. The Board of Directors of the Company is authorized to fix in
advance a record date for the determination of the stockholders entitled to
notice of, and to vote at, any meeting of stockholders and any adjournment
thereof, or entitled to receive payment of any dividend, or to any allotment or
rights, or to exercise any rights in respect of any change, conversion or
exchange of capital stock, or in connection with obtaining the consent of
stockholders for any purpose, which record date shall not be more than 60 nor
less than 10 days proceeding the date of any meeting of stockholders or the date
for the payment of any dividend, or the date for the allotment of rights, or the
date when any change or conversion or exchange of capital stock shall go into
effect, or a date in connection with obtaining such consent.
ARTICLE VI
SEAL
Section 1. The corporate seal of the Company shall be in the following
form:
Between two concentric circles the words
"Wilmington Trust Company" within the inner
circle the words "Wilmington, Delaware."
8
<PAGE>
ARTICLE VII
FISCAL YEAR
Section 1. The fiscal year of the Company shall be the calendar year.
ARTICLE VIII
EXECUTION OF INSTRUMENTS OF THE COMPANY
Section 1. The Chairman of the Board, the President or any Vice President,
however denominated by the Board of Directors, shall have full power and
authority to enter into, make, sign, execute, acknowledge and/or deliver and the
Secretary or any Assistant Secretary shall have full power and authority to
attest and affix the corporate seal of the Company to any and all deeds,
conveyances, assignments, releases, contracts, agreements, bonds, notes,
mortgages and all other instruments incident to the business of this Company or
in acting as executor, administrator, guardian, trustee, agent or in any other
fiduciary or representative capacity by any and every method of appointment or
by whatever person, corporation, court officer or authority in the State of
Delaware, or elsewhere, without any specific authority, ratification, approval
or confirmation by the Board of Directors or the Executive Committee, and any
and all such instruments shall have the same force and validity as although
expressly authorized by the Board of Directors and/or the Executive Committee.
ARTICLE IX
COMPENSATION OF DIRECTORS AND MEMBERS OF COMMITTEES
Section 1. Directors and associate directors of the Company, other than
salaried officers of the Company, shall be paid such reasonable honoraria or
fees for attending meetings of the Board of Directors as the Board of Directors
may from time to time determine. Directors and associate directors who serve as
members of committees, other than salaried employees of the Company, shall be
paid such reasonable honoraria or fees for services as members of committees as
the Board of Directors shall from time to time determine and directors and
associate directors may be employed by the Company for such special services as
the Board of Directors may from time to time determine and shall be paid for
such special services so performed reasonable compensation as may be determined
by the Board of Directors.
9
<PAGE>
ARTICLE X
INDEMNIFICATION
Section 1. (A) The Corporation shall indemnify and hold harmless, to the
fullest extent permitted by applicable law as it presently exists or may
hereafter be amended, any person who was or is made or is threatened to be made
a party or is otherwise involved in any action, suit or proceeding, whether
civil, criminal, administrative or investigative (a "proceeding") by reason of
the fact that he, or a person for whom he is the legal representative, is or was
a director, officer, employee or agent of the Corporation or is or was serving
at the request of the Corporation as a director, officer, employee, fiduciary or
agent of another corporation or of a partnership, joint venture, trust,
enterprise or non-profit entity, including service with respect to employee
benefit plans, against all liability and loss suffered and expenses reasonably
incurred by such person. The Corporation shall indemnify a person in connection
with a proceeding initiated by such person only if the proceeding was authorized
by the Board of Directors of the Corporation.
(B) The Corporation shall pay the expenses incurred in defending any
proceeding in advance of its final disposition, provided, however, that the
payment of expenses incurred by a Director officer in his capacity as a Director
or officer in advance of the final disposition of the proceeding shall be made
only upon receipt of an undertaking by the Director or officer to repay all
amounts advanced if it should be ultimately determined that the Director or
officer is not entitled to be indemnified under this Article or otherwise.
(C) If a claim for indemnification or payment of expenses, under this
Article X is not paid in full within ninety days after a written claim therefor
has been received by the Corporation the claimant may file suit to recover the
unpaid amount of such claim and, if successful in whole or in part, shall be
entitled to be paid the expense of prosecuting such claim. In any such action
the Corporation shall have the burden of proving that the claimant was not
entitled to the requested indemnification of payment of expenses under
applicable law.
(D) The rights conferred on any person by this Article X shall not be
exclusive of any other rights which such person may have or hereafter acquire
under any statute, provision of the Charter or Act of Incorporation, these By-
Laws, agreement, vote of stockholders or disinterested Directors or otherwise.
(E) Any repeal or modification of the foregoing provisions of this
Article X shall not adversely affect any right or protection hereunder of any
person in respect of any act or omission occurring prior to the time of such
repeal or modification.
10
<PAGE>
ARTICLE XI
AMENDMENTS TO THE BY-LAWS
Section 1. These By-Laws may be altered, amended or repealed, in whole or
in part, and any new By-Law or By-Laws adopted at any regular or special
meeting of the Board of Directors by a vote of the majority of all the members
of the Board of Directors then in office.
I, . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Assistant Secretary of Wilmington Trust Company, do hereby
certify that the foregoing is a true and correct copy of the
By-Laws of the Wilmington Trust Company.
Date . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Assistant Secretary
11
<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: July 17, 1995 By: /s/ Emmett R. Harmon
-----------------------------
Name: Emmett R. Harmon
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 March 31, 1995.
--------
<TABLE>
<CAPTION>
ASSETS
Thousands of dollars
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coins............... 224,132
Interest-bearing balances......................................... 0
Held-to-maturity securities............................................. 866,133
Available-for-sale securities........................................... 242,355
Federal funds sold...................................................... 5,000
Securities purchased under agreements to resell......................... 198,831
Loans and lease financing receivables:
Loans and leases, net of unearned income............. 3,207,574
LESS: Allowance for loan and lease losses........... 45,956
LESS: Allocated transfer risk reserve............... 0
Loans and leases, net of unearned income, allowance, and reserve.. 3,161,618
Assets held in trading accounts......................................... 0
Premises and fixed assets (including capitalized leases)................ 69,039
Other real estate owned................................................. 14,430
Investments in unconsolidated subsidiaries and associated companies..... 2,481
Customers' liability to this bank on acceptances outstanding............ 0
Intangible assets....................................................... 4,917
Other assets............................................................ 94,393
Total assets............................................................ 4,883,329
</TABLE>
CONTINUED ON NEXT PAGE
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES
<S> <C>
Deposits:
In domestic offices..................................................... 3,075,750
Noninterest-bearing................ 595,708
Interest-bearing................... 2,480,042
Federal funds purchased................................................. 243,700
Securities sold under agreements to repurchase.......................... 230,426
Demand notes issued to the U.S. Treasury................................ 27,650
Trading liabilities..................................................... 0
Other borrowed money:................................................... ///////
With original maturity of one year or less........................ 820,000
With original maturity of more than one year...................... 0
Mortgage indebtedness and obligations under capitalized leases.......... 1,887
Bank's liability on acceptances executed and outstanding................ 0
Subordinated notes and debentures....................................... 0
Other liabilities....................................................... 86,776
Total liabilities....................................................... 4,486,189
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.................................. 334,615
Net unrealized holding gains (losses) on available-for-sale securities.. (93)
Total equity capital.................................................... 397,140
Total liabilities, limited-life preferred stock, and equity capital..... 4,883,329
</TABLE>
We, the undersigned directors, attest to I, David R. Gibson
the correctness of this statement of ---------------------
resources and liabilities. We declare Name
that it has been examined by us, and
to the best of our knowledge and belief Senior Vice President
has been prepared in conformance with ---------------------
the instructions and is true and correct. Title
/s/ Richard R. Collins ] of the above-named bank
- ------------------------ ] do hereby declare that
] this Report of Condition
/s/ Carolyn S. Burger ] Directors is true and correct to
- ------------------------ ] the best of my knowledge
] and belief.
/s/ Thomas P. Sweeney ]
- ------------------------ ] /s/ David R. Gibson
-----------------------
Signature
04/27/95
-----------------------
2
<TABLE> <S> <C>
<PAGE>
<ARTICLE> UT
<LEGEND> This schedule contains Commonwealth Edison Company's summary financial
information extracted from the Consolidated Balance Sheet and Statement of
Consolidated Capitalization as of June 30, 1995, and the related Statements of
Consolidated Income, Retained Earnings and Cash Flows for the six months ended
June 30, 1995, and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000022606
<NAME> Commonwealth Edison Company
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> JUN-30-1995
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 17,147,592
<OTHER-PROPERTY-AND-INVEST> 1,232,730
<TOTAL-CURRENT-ASSETS> 1,387,854
<TOTAL-DEFERRED-CHARGES> 0<F1>
<OTHER-ASSETS> 3,295,066
<TOTAL-ASSETS> 23,063,242
<COMMON> 2,677,406
<CAPITAL-SURPLUS-PAID-IN> 2,206,728
<RETAINED-EARNINGS> 546,624
<TOTAL-COMMON-STOCKHOLDERS-EQ> 5,430,758
289,183
508,109
<LONG-TERM-DEBT-NET> 7,290,677<F2>
<SHORT-TERM-NOTES> 7,150
<LONG-TERM-NOTES-PAYABLE> 0<F2>
<COMMERCIAL-PAPER-OBLIGATIONS> 40,000
<LONG-TERM-DEBT-CURRENT-PORT> 268,756
17,801
<CAPITAL-LEASE-OBLIGATIONS> 394,624
<LEASES-CURRENT> 181,811
<OTHER-ITEMS-CAPITAL-AND-LIAB> 8,634,373
<TOT-CAPITALIZATION-AND-LIAB> 23,063,242
<GROSS-OPERATING-REVENUE> 3,137,671
<INCOME-TAX-EXPENSE> 163,582<F3>
<OTHER-OPERATING-EXPENSES> 2,433,184
<TOTAL-OPERATING-EXPENSES> 2,597,292
<OPERATING-INCOME-LOSS> 540,379
<OTHER-INCOME-NET> 3,345<F3>
<INCOME-BEFORE-INTEREST-EXPEN> 537,560
<TOTAL-INTEREST-EXPENSE> 303,137
<NET-INCOME> 234,423
33,773
<EARNINGS-AVAILABLE-FOR-COMM> 200,650
<COMMON-STOCK-DIVIDENDS> 171,354
<TOTAL-INTEREST-ON-BONDS> 0<F4>
<CASH-FLOW-OPERATIONS> 1,065,734
<EPS-PRIMARY> 0.94
<EPS-DILUTED> 0
<FN>
<F1> This item is not disclosed as a separate line item on the Consolidated
Balance Sheet.
<F2> $1,263,750 thousand of notes and long-term notes payable to banks is
included in LONG-TERM-DEBT-NET.
<F3> A tax benefit of $526 thousand related to nonoperating activities is
included in INCOME-TAX-EXPENSE.
<F4> This item is not disclosed as a separate line item on the Statement of
Consolidated Income.
</FN>
</TABLE>
