<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 9, 1999
REGISTRATION NO. 333-
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
<TABLE>
<S> <C>
COX COMMUNICATIONS, INC. COX TRUST I
(Exact name of Registrant as specified (Exact name of Registrant as specified in its trust agreement)
in its charter)
DELAWARE DELAWARE
(State or other jurisdiction of (State or other jurisdiction of
incorporation or organization) incorporation or organization)
58-2112251 TO BE APPLIED FOR
(I.R.S. Employer (I.R.S. Employer
Identification No.) Identification No.)
</TABLE>
1400 LAKE HEARN DRIVE
ATLANTA, GEORGIA 30319
(404) 843-5000
(Address, including zip code, and telephone number, including, area code, of
Registrants' principal executive offices)
------------------------
JIMMY W. HAYES
EXECUTIVE VICE PRESIDENT, FINANCE AND ADMINISTRATION
AND
CHIEF FINANCIAL OFFICER
COX COMMUNICATIONS, INC.
1400 LAKE HEARN DRIVE
ATLANTA, GEORGIA 30319
(404) 843-5000
(Name, address, including zip code and telephone number, including area code, of
agent for service)
------------------------
PLEASE ADDRESS A COPY OF ALL COMMUNICATIONS TO:
<TABLE>
<S> <C>
STUART A. SHELDON NORMAN D. SLONAKER
THOMAS D. TWEDT MICHAEL J. SCHIAVONE
DOW, LOHNES & ALBERTSON, PLLC BROWN & WOOD LLP
1200 NEW HAMPSHIRE AVENUE, NW ONE WORLD TRADE CENTER
WASHINGTON, D.C. 20036 NEW YORK, NEW YORK 10048
(202) 776-2000 (212) 839-5300
</TABLE>
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to
time after the effective date of this Registration Statement, as determined by
market conditions.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [X]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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AGGREGATE PROPOSED PROPOSED
TITLE OF EACH AMOUNT MAXIMUM MAXIMUM AMOUNT OF
CLASS OF SECURITIES TO BE OFFERING PRICE AGGREGATE REGISTRATION
TO BE REGISTERED(1) REGISTERED(1)(2) PER UNIT(2) OFFERING PRICE(2) FEE(2)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt Securities of Cox Communications,
Inc....................................
Trust Preferred Securities of Cox Trust
I......................................
Junior Subordinated Debentures of Cox $1,600,000,000 N/A $1,600,000,000 $444,800
Communications, Inc.(3)................
Cox Communications, Inc. Guarantee with
respect to the Trust Preferred
Securities(4)..........................
- --------------------------------------------------------------------------------------------------------------------------
Total.................................... $1,600,000,000 $1,600,000,000 $444,800
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</TABLE>
(1) Such indeterminate number or amount of debt securities and junior
subordinated debentures of Cox Communications, Inc., and trust preferred
securities of Cox Trust I, as may from time to time be issued at
indeterminate prices, with an aggregate initial offering price not to exceed
$1,600,000,000 or the equivalent thereof in one or more foreign currencies,
foreign currency units or composite currencies. Securities registered
hereunder may be sold separately, together or as units with other securities
registered hereunder.
(2) United States dollars or the equivalent thereof in one or more foreign
currencies, foreign currency units or composite currencies estimated in
accordance with Rule 457(o) under the Securities Act of 1933, as amended.
Pursuant to Rule 457(o), which permits the registration fee to be calculated
on the basis of the maximum offering price of all the securities listed, the
table does not specify by each class information as to the amount to be
registered, proposed maximum offering price per unit or proposed maximum
aggregate offering price.
(3) Junior subordinated debentures may be issued and sold to Cox Trust I in
connection with the issuance of trust preferred securities by Cox Trust I,
in which event such debentures may later be distributed to the holders of
trust preferred securities upon a dissolution and liquidation of Cox Trust
I. No separate consideration will be received for the junior subordinated
debentures of Cox Communications, Inc. distributed upon any liquidation of
Cox Trust I.
(4) No separate consideration will be received for the Cox Communications, Inc.
Guarantee.
------------------------
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, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
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<PAGE> 2
THE INFORMATION IN THIS PRELIMINARY PROSPECTUS IS NOT COMPLETE AND MAY BE
CHANGED. COX AND COX TRUST MAY NOT SELL THESE SECURITIES UNTIL THE SECURITIES
AND EXCHANGE COMMISSION DECLARES THE REGISTRATION STATEMENT EFFECTIVE. THIS
PRELIMINARY PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IS NOT
SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE
IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED JULY 9, 1999
PROSPECTUS
$1,600,000,000
COX COMMUNICATIONS, INC.
DEBT SECURITIES
COX TRUST I
TRUST PREFERRED SECURITIES
FULLY AND UNCONDITIONALLY GUARANTEED
TO THE EXTENT PROVIDED IN THIS PROSPECTUS BY
COX COMMUNICATIONS, INC.
------------------------
This prospectus is part of a shelf registration statement which Cox and Cox
Trust have filed with the Securities and Exchange Commission. Under the shelf
registration statement, Cox may offer unsecured debentures, notes, bonds or
other evidences of indebtedness, and Cox Trust may offer its trust preferred
securities, all of which securities combined will have an aggregate initial
public offering price of $1.6 billion, including the U.S. dollar equivalent if
the initial public offering is denominated in one or more foreign currencies,
foreign currency units or composite currencies.
Under the shelf registration process, Cox and Cox Trust may sell the
securities from time to time in one or more separate offerings, in amounts, at
prices and on terms to be determined at the time of sale. Cox's debt securities
may be issuable in global form, in registered form without coupons attached, or
in bearer form with or without coupons attached.
This prospectus provides a general description of the securities Cox and
Cox Trust may offer. Each time Cox sells a particular series of debt securities,
or Cox Trust sells trust preferred securities, it will provide a prospectus
supplement which will contain the specific terms of the securities being offered
at that time. Unless otherwise specified in the prospectus supplement, the debt
securities will be senior debt securities of Cox.
The prospectus supplement may add, update or change information contained
in this prospectus. You should read both this prospectus and the prospectus
supplement in conjunction with the additional information described under the
headings "Where You Can Find More Information" and "Information Incorporated by
Reference."
------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------------
The date of this prospectus is , 1999.
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Cox Communications, Inc..................................... 1
Cox Trust I................................................. 2
Use of Proceeds............................................. 3
Ratio of Earnings to Fixed Charges.......................... 3
Description of Debt Securities.............................. 4
Description of Junior Subordinated Debentures............... 15
Description of Trust Preferred Securities................... 23
Description of Preferred Securities Guarantee............... 32
Relationship Among the Trust Preferred Securities, the
Corresponding Junior Subordinated Debentures and the
Preferred Securities Guarantee............................ 35
Plan of Distribution........................................ 37
Legal Matters............................................... 38
Experts..................................................... 38
Where You Can Find More Information......................... 38
Information Incorporated by Reference....................... 38
</TABLE>
---------------------------
You should rely only on the information contained or incorporated by
reference in this prospectus or any prospectus supplement. Neither Cox nor Cox
Trust has authorized anyone else to provide you with different information. Cox
and Cox Trust are offering these securities only in states where the offer is
permitted. You should not assume that the information in this prospectus or any
prospectus supplement is accurate as of any date other than the date on the
front of those documents. Cox's business, financial condition, results of
operations and prospects may have changed since that date.
i
<PAGE> 4
COX COMMUNICATIONS, INC.
Cox is one of the largest broadband communications companies in the United
States. Cox has extensive broadband network operations in the United States as
well as investments in cable television programming, telecommunications, and
technology and broadband networks.
At present, Cox is focused primarily on developing new and advanced
communications services. Cox believes that it has a number of advantages that
will allow it to implement this strategy successfully, including:
- ownership of highly clustered cable television systems;
- being on the cutting edge in upgrading the technological capabilities of
its broadband networks; and
- a strong commitment to and reputation for superior customer service.
In addition, Cox leads the communications industry in creating and offering
integrated packages of telecommunications services. Cox believes that such
integration will allow it to retain existing customers, acquire new customers
and increase the revenue stream from each customer. Cox is bundling services
like:
- multichannel video;
- digital video;
- high-speed Internet access;
- local and long-distance telephone services; and
- commercial local exchange carrier operations.
Cox also has invested in programming, telecommunications and technology
companies that complement its business strategy. Cox believes that its
investments have been vital to its growth into a communications industry leader.
Cox Enterprises, Inc., a privately held corporation based in Georgia and
one of the largest media companies in the U.S., controls approximately 72.7% of
Cox. In addition to Cox, Cox Enterprises publishes, owns or operates newspapers,
television and radio stations, Internet web sites, and Manheim Auctions, the
world's largest auto auction operator.
Cox's principal executive offices are located at 1400 Lake Hearn Drive,
Atlanta, Georgia 30319. Its telephone number is (404) 843-5000.
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<PAGE> 5
COX TRUST I
Cox Trust I is a statutory business trust created under Delaware law
pursuant to:
1. a trust agreement executed by Cox, as sponsor for Cox Trust, and by
the initial trustees of Cox Trust; and
2. the filing of a certificate of trust with the Delaware Secretary of
State on July 7, 1999.
Cox Trust exists for the exclusive purposes of:
- issuing and selling trust preferred securities representing undivided
beneficial interests in the assets of Cox Trust and trust common
securities representing undivided beneficial interests in the assets
of Cox Trust;
- using the proceeds from the sale of such trust securities to acquire
the related junior subordinated debentures of Cox; and
- engaging in only those other activities necessary, advisable or
incidental to these purposes.
Cox's junior subordinated debentures will be the sole assets of Cox Trust and,
accordingly, payments under the related junior subordinated debentures will be
the sole revenues of Cox Trust.
All of the trust common securities of Cox Trust will be owned by Cox and
will rank equally, and payments will be made on trust common securities pro
rata, with the trust preferred securities of Cox Trust, except that upon the
occurrence and continuance of an event of default under the trust agreement
resulting from an event of default under the junior subordinated debenture
indenture, the rights of Cox as the trust common securities holder to payments
in respect of distributions and payments upon liquidation, redemption or
otherwise will be subordinated to the rights of the holders of trust preferred
securities of Cox Trust. See "Description of Trust Preferred Securities --
Subordination of Trust Common Securities." Cox will acquire trust common
securities of Cox Trust in an aggregate liquidation amount equal to at least 3%
of the total capital of Cox Trust. Cox Trust has a term of 35 years, but may
dissolve earlier as provided in the trust agreement.
Cox Trust's business and affairs are conducted by trustees who are
appointed by Cox as the trust common securities holder. Unless otherwise
specified in the prospectus supplement, the issuer trustees for Cox Trust will
be The Bank of New York, as property trustee, The Bank of New York (Delaware),
as Delaware trustee, and three individual trustees, which are referred to as
administrative trustees, who are officers or employees of Cox. The Bank of New
York, as property trustee, will act as sole indenture trustee under the trust
agreement. The Bank of New York will also act as indenture trustee under the
preferred securities guarantee and the junior subordinated debenture indenture.
See "Description of Preferred Securities Guarantee" and "Description of Junior
Subordinated Debentures." The trust common securities holder of Cox Trust or, if
an event of default under the trust agreement has occurred and is continuing,
the holders of a majority in liquidation amount of the trust preferred
securities of Cox Trust will be entitled to appoint, remove or replace Cox
Trust's property trustee and the Delaware trustee. In no event will the holders
of trust preferred securities have the right to vote to appoint, remove or
replace the administrative trustees; such voting rights will be vested
exclusively in Cox as the trust common securities holder. The duties and
obligations of the trustees will be governed by the trust agreement.
Cox, as issuer of the junior subordinated debentures, will pay all fees,
expenses, debts and obligations, other than payments in respect of trust
securities, related to Cox Trust and the offering of the trust preferred
securities and will pay, directly or indirectly, all ongoing costs, expenses and
liabilities of Cox Trust, other than payments in respect of trust securities.
The principal executive office of Cox Trust is c/o Cox Communications,
Inc., 1400 Lake Hearn Drive, Atlanta, Georgia 30319.
2
<PAGE> 6
USE OF PROCEEDS
Unless otherwise stated in the accompanying prospectus supplement, Cox
intends to use the net proceeds from the sale of any offered debt securities for
general corporate purposes, which may include additions to working capital,
repayment or redemption of existing indebtedness and financing of capital
expenditures and acquisitions. Cox may borrow additional funds from time to time
from public and private sources on both a long-term and short-term basis and may
sell commercial paper to fund its future capital and working capital
requirements in excess of internally generated funds.
The proceeds from the sale of trust preferred securities by Cox Trust will
be invested in the junior subordinated debentures of Cox. Except as may
otherwise be described in the prospectus supplement relating to such trust
preferred securities, Cox expects to use the net proceeds from the sale of such
junior subordinated debentures to Cox Trust for general corporate purposes. Any
specific allocation of the proceeds to a particular purpose that has been made
at the date of any prospectus supplement will be described therein.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of earnings to fixed charges of
Cox for the periods indicated:
<TABLE>
<CAPTION>
THREE MONTHS ENDED
YEAR ENDED DECEMBER 31, MARCH 31,
- --------------------------------- -------------------
1994 1995 1996 1997 1998 1998 1999
- ---- ---- ---- ---- ----- -------- --------
<S> <C> <C> <C> <C> <C> <C>
2.7x 2.7x 1.5x 2.0x 12.3x 0.9x 8.8x
</TABLE>
Earnings for the years ended December 31, 1995, 1996, 1997 and 1998 and for
the three months ended March 31, 1999 include $188.8 million, $4.6 million,
$116.6 million, $2.5 billion and $419.5 million, respectively, of net investment
gains.
For purposes of this computation, earnings are defined as income before
income taxes and, excluding losses and undistributed earnings on equity method
investments, minority interests and fixed charges excluding capitalized
interest. Fixed charges are the sum of:
- interest cost including capitalized interest;
- estimated interest component of rent expense; and
- dividends on subsidiary preferred stock.
3
<PAGE> 7
DESCRIPTION OF DEBT SECURITIES
GENERAL
The following description of the terms of the debt securities sets forth
selected general terms and provisions of the particular issuance of debt
securities to which any prospectus supplement may relate. The prospectus
supplement will describe the particular terms of any debt securities and the
extent, if any, to which such general provisions will not apply to those debt
securities.
The debt securities will be issued from time to time in series under an
indenture, dated as of June 27, 1995, between Cox and The Bank of New York, as
trustee. A copy of the indenture is incorporated by reference as an exhibit to
the registration statement of which this prospectus is a part.
The indenture does not limit the aggregate principal amount of debt
securities Cox may issue, and the indenture provides that Cox may issue debt
securities from time to time in one or more series. The following summary of
selected provisions of the indenture and the debt securities does not purport to
be complete and is subject to, and is qualified in its entirety by reference to,
all the provisions of the indenture, including the definitions of selected terms
which it contains as well as those terms which the Trust Indenture Act of 1939,
as amended, requires be incorporated.
Cox refers you to the prospectus supplement for the following terms and
other possible terms of each series of debt securities in respect of which this
prospectus is being delivered, to the extent such terms are applicable to such
debt securities:
- the classification, specific designation, date, aggregate principal
amount, purchase price and denomination of the debt securities;
- currency or units based on or relating to currencies in which such debt
securities are denominated and/or in which principal, premium, if any,
and/or interest will or may be payable;
- the formula, if any, upon which Cox may determine from time to time the
principal amount of debt securities outstanding;
- any date of maturity, which may be fixed or extendible;
- the interest rate or rates or the method by which the interest rate or
rates will be determined, if any;
- the dates on which any interest will be payable, Cox's right, if any, to
extend or defer the interest period and the duration of extensions or
deferrals;
- the place or places where the principal of, premium, if any, and interest
on the debt securities will be payable;
- any repayment, redemption, prepayment or sinking fund provisions and any
provisions related to the purchase of debt securities at the option of
the holders;
- whether the debt securities will be issuable in global form, and, if so,
the identity of the depositary, or in registered and/or bearer form and,
if bearer securities are issuable, any restrictions applicable to the
exchange of one form for another and to the offer, sale and delivery of
bearer securities;
- the terms, if any, on which debt securities may be converted into or
exchanged for stock or other securities of Cox or other entities or for
cash, any specific terms relating to the adjustment of the conversion or
exchange terms, and the period during which debt securities may be so
converted or exchanged;
- any applicable United States federal income tax consequences, including
whether and under what circumstances Cox will pay additional amounts on
debt securities held by a person who is not a U.S. person, as defined in
the prospectus supplement, in respect of any tax, assessment or
4
<PAGE> 8
governmental charge withheld or deducted and, if so, whether Cox will have the
option to redeem debt securities rather than pay such additional amounts;
- the subordination provisions, if any, relating to the debt securities;
and
- any other specific terms of the debt securities, including any additional
events of default or covenants provided for with respect to debt
securities, and any terms which may be required by or advisable under
applicable laws or regulations.
Holders may present debt securities for exchange, and holders of registered
debt securities may present them for transfer, in the manner, at the places and
subject to the restrictions set forth in the debt securities and the prospectus
supplement. Cox will provide these services without charge, other than any tax
or other governmental charge payable in that connection, but subject to the
limitations provided in the indenture. Debt securities in bearer form and the
coupons, if any, pertaining to such debt securities will be transferable by
delivery.
Debt securities will bear interest at a fixed rate or a floating rate. Debt
securities bearing no interest or interest at a rate that at the time of
issuance is below the prevailing market rate will be sold at a discount below
their stated principal amount. Special United States federal income tax
considerations applicable to any discounted debt securities or to certain debt
securities issued at par, which are treated as having been issued at a discount
for United States federal income tax purposes, will be described in the
accompanying prospectus supplement.
Cox may issue debt securities from time to time, with the principal amount
payable on any principal payment date, or the amount of interest payable on any
interest payment date, to be determined by reference to one or more currency
exchange rates, commodity prices, equity indices or other factors. Holders of
these debt securities may receive a payment of principal on any principal
payment date, or a payment of interest on any interest payment date, that is
greater or less than the amount of principal or interest otherwise payable on
those dates, depending upon the value of the applicable currency, commodity,
equity index or other factor on those dates. Information as to the methods Cox
will use to determine the amount of principal or interest payable on any date,
the currencies, commodities, equity indices or other factors to which the amount
payable on that date is linked and certain additional tax considerations will be
set forth in the applicable prospectus supplement.
Unless Cox indicates otherwise in the accompanying prospectus supplement,
the debt securities will be issued only in fully registered form, without
coupons, in denominations of $1,000 and any integral multiples of $1,000. Unless
Cox specifies otherwise in the prospectus supplement, the principal amount of
the debt securities will be payable at the corporate trust office of the trustee
in New York, New York. Holders may present the debt securities for transfer or
exchange at that office unless Cox specifies otherwise in the prospectus
supplement, subject to the limitations provided in the indenture and without any
service charge, but Cox may require payment of a sum sufficient to cover any tax
or other governmental charges payable.
CONCERNING THE TRUSTEE
The Bank of New York is the trustee under the indenture and has been
appointed by Cox as registrar and paying agent with regard to the debt
securities. The trustee is a depository for funds and performs other services
for, and transacts other banking business with, Cox in the normal course of
business.
RANKING
Unless Cox specifies otherwise in a prospectus supplement for a particular
series of debt securities, all series of debt securities will be senior
indebtedness of Cox and will be direct, unsecured obligations, ranking equally
with all of Cox's other unsecured and unsubordinated obligations.
Cox conducts most of its operations through its subsidiaries. Therefore,
Cox's rights and the rights of Cox's creditors, including debt securities
holders, to participate in the assets of any subsidiary upon such
5
<PAGE> 9
subsidiary's liquidation or recapitalization will be subject to the prior claims
of the subsidiary's creditors, except to the extent Cox may be a creditor with
recognized claims against the subsidiary.
CERTAIN COVENANTS
The indenture contains covenants, including, among others, the following:
Limitation on liens. Cox will not, and will not permit any restricted
subsidiary to, create, incur or assume any lien, other than permitted liens on
restricted property incurred to secure the payment of Indebtedness of Cox or any
restricted subsidiary, if, immediately after the creation, incurrence or
assumption of such lien, the aggregate outstanding principal amount of all
Indebtedness of Cox and its restricted subsidiaries that is secured by liens
other than permitted liens on restricted property would exceed the greater of:
- $200 million or
- 15% of the aggregate outstanding principal amount of all Indebtedness of
Cox and the restricted subsidiaries, whether or not so secured,
unless effective provision is made such that, at Cox's determination, the debt
securities together with any other Indebtedness of equal ranking, whether then
existing or later created, are secured equally and ratably with, or prior to,
such Indebtedness, but only for as long as such Indebtedness is so secured.
Limitation on Indebtedness of restricted subsidiaries. Cox will not permit
any restricted subsidiary to incur any Indebtedness if, immediately after the
incurrence or assumption of such Indebtedness, the aggregate outstanding
principal amount of all indebtedness of the restricted subsidiaries would exceed
the greater of:
- $200 million; or
- 15% of the aggregate outstanding principal amount of all Indebtedness of
Cox and the restricted subsidiaries;
provided that, in any event, a restricted subsidiary may incur Indebtedness to
extend, renew or replace its own Indebtedness to the extent that the principal
amount of the Indebtedness so incurred does not exceed the level of the
principal amount of the Indebtedness immediately prior to such extension,
renewal or replacement plus any premium, accrued and unpaid interest or
capitalized interest payable on the previous amount.
Designation of subsidiaries. Cox may designate a restricted subsidiary as
an unrestricted subsidiary or designate an unrestricted subsidiary as a
restricted subsidiary at any time, provided that:
- immediately after giving effect to such designation, the restricted
group's leverage ratio is not greater than 7:1 and Cox and the restricted
subsidiaries are in compliance with the "Limitation on Liens" and
"Limitation on Indebtedness of Restricted Subsidiaries" covenants; and
- Cox delivers an officers' certificate with respect to such designation,
to the trustee, within 75 days after the end of Cox's fiscal quarter in
which it made such designation, or, in the case of a designation made
during the last fiscal quarter of Cox's fiscal year, within 120 days
after the end of such fiscal year. The officers' certificate shall state
the effective date of such designation.
Mergers or sales of assets. The indenture provides that Cox may not merge
with or into or consolidate with another entity or lease, convey or transfer all
or substantially all of its assets to another entity unless either:
- Cox is the surviving corporation; or
- the resulting, surviving or transferee entity is a corporation organized
under the laws of a state of the United States or the District of
Columbia and expressly assumes all of Cox's obligations under the debt
securities and the indenture; and
- immediately after and giving effect to such transaction, no event of
default has occurred.
The indenture does not contain any provisions affording debt securities
holders any additional protection in the event that Cox enters into a
highly-leveraged transaction.
6
<PAGE> 10
DEFINITIONS
Indebtedness means, without duplication, with respect to any entity:
- any indebtedness of such entity for borrowed money or evidenced by a
note, debenture or similar instrument, including a purchase money
obligation which was given in connection with the acquisition of any
property or assets, including securities;
- any guarantee by such entity of any indebtedness of others as described
in the preceding clause; and
- any amendment, extension, renewal or refunding of any such indebtedness
or guarantee.
The term Indebtedness excludes:
- any indebtedness of Cox or of any its restricted subsidiaries to Cox or
another restricted subsidiary;
- any guarantee by Cox or any restricted subsidiary of indebtedness of Cox
or another restricted subsidiary;
- trade accounts payable; and
- letters of credit, performance bonds and similar obligations issued in
favor of governmental or franchising authorities as a term of a cable
television franchise or other governmental franchise, license, permit or
authorization held by such entity or any of its subsidiaries.
Leverage ratio with respect to the restricted group means, as of the date
of and after giving effect to any designation of an unrestricted subsidiary as a
restricted subsidiary, or any designation of a restricted subsidiary as an
unrestricted subsidiary, in each case in accordance with the "Designation of
Subsidiaries" covenant, the ratio of:
- the aggregate outstanding principal amount of all Indebtedness of the
restricted group as of such date;
to
- the product of four times the restricted group cash flow for the most
recent full fiscal quarter for which financial information is available
on such date.
Permitted liens means:
1. Any lien which arises out of a judgment or award against Cox or any
restricted subsidiary, with respect to which Cox or such restricted
subsidiary, at the time, shall be prosecuting an appeal or proceeding
for review, or with respect to which the period within which such
appeal or proceeding for review may be initiated shall not have
expired, and with respect to which:
- Cox or such restricted subsidiary shall have secured a stay of
execution pending such appeal or proceeding for review; or
- Cox or such restricted subsidiary shall have posted a bond or
established adequate reserves, in accordance with generally
accepted accounting principles, for the payment of such judgment or
award;
2. Any lien upon any real or personal property or interest in such
property belonging to Cox or a restricted subsidiary and existing at
the time the property or interest was acquired, or securing payment
of Indebtedness which Cox or the restricted subsidiary incurred to
finance some or all of the purchase price of, or cost of construction
of or improvements on, any such property or interest therein;
provided that:
- the outstanding principal amount of the Indebtedness secured by
such lien does not at any time exceed 100% of the greater of the
purchase price for or the fair value of such real or personal
property or interest;
7
<PAGE> 11
- such lien does not encumber or constitute a charge against any
other restricted property owned by the restricted group, except
that in the case of construction or improvement, the lien may
extend to unimproved real property on which the property so
constructed or the improvement is located; and
- the indebtedness secured by such lien would be permitted to be
incurred under the covenant described under "Limitation on
Indebtedness of Restricted Subsidiaries;" and
3. Any lien representing the extension, renewal or replacement, or
successive extensions, renewals or replacements, of liens referred to
in paragraph (2) above, provided that the principal of the
Indebtedness thus secured does not exceed
- the principal of the Indebtedness secured immediately prior to such
extension, renewal or replacement,
plus
- any accrued and unpaid interest or capitalized interest payable;
and such extension, renewal or replacement shall be limited to
- all or a part of the property or interest subject to the lien so
extended, renewed or replaced,
plus
- improvements and construction on such property.
The outstanding principal amount of Indebtedness secured by a lien
permitted by paragraph (2) or (3) above or, if less, the fair value of the
property or interest thus secured, shall be included in the calculation of the
aggregate outstanding principal amount of Indebtedness secured by liens on
restricted property, for purposes of determining whether a lien, other than a
permitted lien, may be incurred in compliance with the covenant described under
"Limitation on Liens."
Principal property means, as of any date of determination, any property or
assets which any restricted subsidiary owns other than:
- any such property which, in the good faith opinion of Cox's board of
directors, is not of material importance to the business conducted by Cox
and its restricted subsidiaries taken as a whole; and
- any shares of any class of stock or any other security of any
unrestricted subsidiary.
Restricted group means, as of any date of determination, Cox and the
restricted subsidiaries as of such date and after giving effect to any
designation being made on such date in accordance with the "Designation of
Subsidiaries" covenant.
Restricted group cash flow for any period means the restricted group's net
income for such period,
plus
the sum, without duplication, of the aggregate of each of the following
items of Cox and the restricted subsidiaries for such period, to the extent
taken into account as charges to restricted group net income for such period:
- interest expense;
- income tax expense;
- depreciation and amortization expense and other noncash charges;
- extraordinary items; and
- after-tax losses on sales of assets outside of the ordinary course of
business, which otherwise are not included in extraordinary items in
accordance with generally accepted accounting principles;
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minus
the sum, without duplication, of the aggregate of each of the following
items of Cox and the restricted subsidiaries for such period, to the extent
taken into account as credits to restricted group net income for such period:
- noncash credits;
- extraordinary items; and
- after-tax gains on sales of assets outside of the ordinary course of
business, which otherwise are not included in extraordinary items in
accordance with generally accepted accounting principles.
For purposes of this definition:
- Restricted group net income for any period means the aggregate of the net
income or loss of Cox and its restricted subsidiaries for such period,
determined on a consolidated basis in accordance with generally accepted
accounting principles; provided that the net income or loss of any entity
accounted for by the equity method of accounting, and the net income or
loss of any unrestricted subsidiary, shall be excluded. However, the net
income of any such entity or unrestricted subsidiary shall be included to
the extent of the amount of dividends or distributions such entity or
unrestricted subsidiary pays to Cox or a restricted subsidiary during
such period; and
- if Cox or any restricted subsidiary consummated any acquisition or
disposition of assets during the period for which restricted group cash
flow is being calculated, or consummated any acquisition or disposition
of assets subsequent to such period and on or prior to the date as of
which the leverage ratio is to be determined, then, in each such case,
the restricted group cash flow for such period shall be calculated on a
pro forma basis, instead of as a pooling of interests, if applicable, as
if such acquisition or disposition had occurred at the beginning of such
period.
Restricted property means, as of any date of determination, any principal
property and any shares of stock of a restricted subsidiary which Cox or a
restricted subsidiary owns.
DEFAULTS
An event of default with respect to debt securities of any series is
defined in the indenture as:
1. a default in the payment of interest when due on the debt securities
of that series which continues for 30 days;
2. a default in the payment of principal of any debt security of that
series when due, whether at its stated maturity, upon redemption,
upon required repurchase, by declaration or otherwise;
3. Cox's failure to comply with its obligations under "-- Certain
Covenants Mergers or Sales of Assets" above;
4. Cox's failure to comply, within 60 days after notice provided in
accordance with the terms of the indenture, with any of its other
covenants or agreements contained in the indenture with respect to
that series of debt securities, including its obligations under the
covenants described above under "-- Certain Covenants -- Limitation
on Liens," "-- Limitation on Indebtedness of Restricted Subsidiaries"
or "-- Designation of Subsidiaries," provided that this provision
does not apply to defaults in covenants for which the indenture
specifically provides otherwise;
5. Indebtedness of Cox or any restricted subsidiary is not paid within
any applicable grace period after final maturity or is accelerated by
its holders because of a default and the total amount of such
Indebtedness unpaid or accelerated exceeds 5% of the aggregate
outstanding principal amount of all Indebtedness of Cox and the
restricted subsidiaries;
6. certain events of bankruptcy, insolvency or reorganization of Cox or
a restricted subsidiary;
7. failure to make a sinking fund payment when due on the debt
securities of that series; or
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8. any other events of default specified for that series of debt
securities.
Except as described in the second to last sentence of this paragraph, if an
event of default occurs and is continuing with respect to a particular series of
debt securities, the trustee or the holders of at least 25% in principal amount
of the outstanding debt securities of such series may declare the principal of
and accrued but unpaid interest on all the debt securities of such series to be
due and payable. Upon such a declaration, such principal and interest shall be
due and payable immediately. If an event of default relating to specific events
of bankruptcy, insolvency or reorganization of Cox occurs and is continuing, the
principal of and interest on all the debt securities will become and be
immediately due and payable without any declaration or other act on the part of
the trustee or any holders of the debt securities. Under some circumstances, the
holders of a majority in principal amount of the outstanding debt securities of
a series may rescind any acceleration and its consequences with respect to the
debt securities of that series.
Subject to the provisions of the indenture relating to the duties of the
trustee, if an event of default occurs and is continuing, the trustee will be
under no obligation to exercise any of its rights or powers under the indenture
at the request or direction of any of the holders of the debt securities of any
series, unless such holders have offered to the trustee reasonable indemnity or
security against any loss, liability or expense. Except to enforce the right to
receive payment of principal, premium, if any, or interest when due, no debt
security holder may pursue any remedy with respect to the indenture or the debt
securities of its series unless:
- that holder has previously given the trustee notice that an event of
default is continuing;
- holders of at least 25% in principal amount of the outstanding debt
securities of such series have requested the trustee to pursue the
remedy;
- those holders have offered the trustee reasonable security or indemnity
against any loss, liability or expense;
- the trustee has not complied with such request within 60 days of
receiving it with an offer of security or indemnity; and
- the holders of a majority in principal amount of the outstanding debt
securities of such series have not given the trustee a direction
inconsistent with such request within such 60-day period.
Subject to some restrictions, the holders of a majority in principal amount
of the outstanding debt securities of any series are given the right to direct
the time, method and place of conducting any proceeding for any remedy available
to the trustee, or of exercising any trust or power conferred on the trustee.
The trustee, however, may refuse to follow any direction that conflicts with law
or the indenture or that the trustee determines is unduly prejudicial to the
rights of any other holder of a debt security of the same series, or that would
involve the trustee in personal liability.
The indenture provides that if a default occurs and is continuing with
respect to a particular series of debt securities and is known to the trustee,
the trustee must mail notice of the default within 90 days after it occurs to
each holder of the debt securities of such series. Except in the case of a
default in the payment of principal of, premium, if any, or interest on any debt
security, the trustee may withhold notice if and so long as a committee of its
trust officers determines that withholding notice is in the interests of the
holders of the debt securities of such series. In addition, Cox must deliver to
the trustee, within 120 days after the end of each fiscal year, an officers'
certificate indicating whether the signers thereof know of any default that
occurred during the previous year. Cox also is required to deliver to the
trustee, within 30 days after its occurrence, written notice of any events which
would constitute certain defaults, their status and what action Cox is taking or
proposes to take.
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Prior to the acceleration of the maturity of the debt securities of any
series, the holders of a majority in aggregate principal amount of the
outstanding debt securities of that series may on behalf of all the debt
securities and any related coupons of that series waive any past default or
event of default, except:
- a default in the payment of the principal of, and premium, if any, or
interest on, any of the debt securities or in the payment of any related
coupon; and
- a default that cannot be waived without the consent of each holder
affected.
A waiver will serve to end such default, to cure any event of default, and to
restore Cox, the trustee and holders of the affected debt securities to their
former positions and rights. No such waiver will extend to any subsequent or
other default.
AMENDMENTS AND WAIVERS
Subject to specific exceptions, the indenture may be amended with respect
to a series of debt securities with the consent of the holders of a majority in
principal amount then outstanding of the debt securities of that series,
including consents obtained in connection with a tender offer or exchange for
the debt securities. Any past default or compliance with any provisions also may
be waived with such a consent of the holders of a majority in principal amount
then outstanding of the debt securities of such series. However, without the
consent of each holder of an outstanding debt security of that series, no
amendment may, among other things:
- reduce the amount of debt securities of that series whose holders must
consent to an amendment;
- reduce the rate of, or extend the time for, payment of interest on any
debt security of that series;
- reduce the principal of or extend the stated maturity of any debt
security of that series;
- reduce the premium payable upon the redemption of any debt security of
that series, or change the time at which any debt security of that series
may or shall be redeemed;
- make any debt securities of that series payable in a currency other than
that stated in the debt securities of such series;
- release any security that may have been granted in respect of the debt
securities; or
- make any change (1) affecting the rights of holders of a majority in
principal amount of the outstanding debt securities of that series to
direct the time, method and place of conducting proceedings for any
remedy available to the trustee, (2) in the amendment provisions which
requires each holder's consent, or (3) in the waiver provisions.
Without the consent of any of the debt securities holders, Cox and the
trustee may amend the indenture:
- to cure any ambiguity, omission, defect or inconsistency;
- to provide for the assumption by a successor entity of Cox's obligations
under the indenture;
- to provide for uncertificated debt securities in addition to or in place
of certificated debt securities;
- to add guarantees with respect to the debt securities;
- to secure the debt securities;
- to add to the covenants for the benefit of holders of all or any series
of the debt securities and to make a default of that additional covenant
an event of default under the indenture for all or any series of debt
securities;
- to surrender any right or power conferred upon Cox;
- to convey, transfer, assign, mortgage or pledge any property to or with
the trustee, or to make such other provisions in regard to matters or
questions arising under the indenture as shall not adversely affect the
interests of any holders of debt securities;
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- to make any change that does not adversely affect the rights of any debt
securities holder;
- to provide for a successor or separate trustee with respect to the debt
securities of one or more series; or
- to comply with any SEC requirement in connection with the qualification
of the indenture under the Trust Indenture Act.
The indenture does not require the debt securities holders to give consent
approving of the particular form of any proposed amendment. It is sufficient if
such consent approves the substance of the proposed amendment.
After an amendment under the indenture becomes effective, Cox is required
to mail to holders of the debt securities of the affected series a notice
briefly describing such amendment. However, Cox's failure to give such notice to
all holders of the debt securities of such series, or any defect in such notice,
will not impair or affect the validity of the amendment.
DEFEASANCE
Cox at any time may terminate all its obligations with respect to a
particular series of debt securities, and under the indenture, with respect to
the legal defeasance of such series, except for specific obligations including:
- those respecting the defeasance trust;
- to register the transfer or exchange of the debt securities;
- to replace mutilated, destroyed, lost or stolen debt securities; and
- to maintain a registrar and paying agent in respect of the debt
securities.
Cox at any time may terminate its obligations with respect to a series of
debt securities under the covenants described under "-- Certain Covenants,"
other than the covenants described under "-- Mergers or Sales of Assets," and
any other restrictive covenants described in the accompanying prospectus
supplement relating to that series, as well as the operation of the
cross-acceleration provision and the bankruptcy provisions described under
"-- Defaults" above.
Cox may exercise its legal defeasance option notwithstanding its prior
exercise of the covenant defeasance option. If Cox exercises its legal
defeasance option with respect to a particular series of debt securities,
payment of the debt securities of that series may not be accelerated because of
an event of default with respect thereto. If Cox exercises its covenant
defeasance option with respect to a particular series of debt securities,
payment of the debt securities of such series may not be accelerated because of
an event of default as specified in paragraphs (4), (5) or (6) under
"-- Defaults" above, with respect to restricted subsidiaries only, or paragraph
(8) above, except to the extent that any of the agreements or covenants
referenced in such paragraphs remain applicable.
In order to exercise either defeasance option with respect to a particular
series of debt securities, Cox must deposit irrevocably in trust, with the
trustee, money or U.S. Government obligations, which trust will be known as the
defeasance trust. Through the payment of interest and principal on the debt
securities in accordance with their terms the defeasance trust will provide
money in an amount sufficient to pay all the principal, including any mandatory
sinking fund payments, of, premium, if any, on, and interest on the debt
securities of that series, to redemption or maturity, as the case may be. Cox
also must comply with other specified conditions, including delivery to the
trustee of an opinion of counsel to the effect that:
- holders of the debt securities of that series will not recognize income
gain or loss for United States federal income tax purposes as a result of
such deposit and defeasance;
- holders of the debt securities of that series will be subject to United
States federal income tax on the same amount, in the same manner and at
the same times as would have been the case if such deposit and defeasance
had not occurred;
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- in the case of legal defeasance only, that opinion of counsel must be
based on a ruling of the Internal Revenue Service or other change in
applicable federal income tax law; and
- the creation of the defeasance trust will not violate the Investment
Company Act of 1940, as amended.
In addition, Cox must deliver to the trustee an officers' certificate
stating that Cox did not make such deposit with the intent of preferring the
debt securities holders over other of Cox's creditors, or with the intent of
defeating, hindering, delaying or defrauding its creditors or the creditors of
others.
TRANSFER
Holders may transfer or exchange the debt securities in accordance with the
indenture. Unless Cox indicates otherwise in the applicable prospectus
supplement, Cox will issue the debt securities in registered form and they will
be transferable only upon the surrender of such debt securities for registration
of transfer. Cox may require payment of a sum sufficient to cover any tax,
assessment or other governmental charge payable in connection with certain
transfers or exchanges. Cox is not required to transfer or exchange any debt
security selected for redemption. In addition, Cox is not required to transfer
or exchange any debt security for a period of 15 days before a selection of debt
securities to be redeemed or before any interest payment date.
GOVERNING LAW
The indenture provides that it and the debt securities will be governed by,
and construed in accordance with, the laws of the State of New York without
giving effect to applicable principles of conflicts of law to the extent that
the application of the law of another jurisdiction would be required thereby.
GLOBAL SECURITIES
Cox may issue the registered debt securities of a series in the form of one
or more fully registered global securities which will be deposited with a
depositary, or with a nominee for the depositary, as identified in the
prospectus supplement relating to such series. A registered global security will
be registered in the name of the depositary or its nominee. If registered debt
securities are issued in global form, one or more registered global securities
will be issued in a denomination or aggregate denominations equal to the portion
of the aggregate principal amount of outstanding registered debt securities of
the series to be represented by those registered global securities. Unless and
until it is exchanged in whole for debt securities in definitive registered
form, a registered global security may not be transferred except as a whole by
the depositary:
- to its nominee;
- by its nominee to such depositary or another such nominee; or
- by the depositary or any of its nominees to a successor of that
depositary or the successor's nominee.
The specific terms of the depositary arrangement with respect to any
portion of a series of debt securities to be represented by a registered global
security will be described in the prospectus supplement relating to such series.
Cox anticipates that the following provisions will apply to all depositary
arrangements.
Ownership of beneficial interests in a registered global security will be
limited to persons, who will be referred to as participants, who have accounts
with the depositary for such registered global security, or persons that may
hold interests through participants. Upon the issuance of a registered global
security, the depositary will credit the participants' accounts, on its
book-entry registration and transfer system, with the respective principal
amounts of the debt securities represented by such registered global security
and beneficially owned by those participants. The accounts to be credited shall
be designated by any dealers,
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underwriters or agents participating in the distribution of those debt
securities, or by Cox if it offers and sells such debt securities directly.
Ownership of beneficial interests in such registered global security will be
shown on, and the transfer of those ownership interests will be effected only
through, records maintained by the depositary with respect to participants'
interests, and on the records of participants with respect to interests of
persons holding through participants. The laws of some states may require that
some purchasers of securities take physical delivery of such securities in
definitive form. Such laws may impair the ability of those purchasers to own,
transfer or pledge beneficial interests in registered global securities.
So long as the depositary for a registered global security, or its nominee,
is the registered owner of that registered global security, that depositary or
that nominee, as the case may be, will be considered the sole owner or holder of
the debt securities represented by such registered global security for all
purposes under the indenture. Except as set forth below, owners of beneficial
interests in a registered global security will not be entitled to have the debt
securities registered in their names, will not receive or be entitled to receive
physical delivery of such debt securities in definitive form and will not be
considered the owners or holders of the debt securities under the indenture.
Accordingly, each person owning a beneficial interest in a registered global
security must rely on the procedures of the depositary for such registered
global security and, if such person is not a participant, on the procedures of
the participant through which that person owns its interest, to exercise any
rights a holder possesses under the indenture. Cox understands that under
existing industry practices, if Cox requests any action of holders or if an
owner of a beneficial interest in a registered global security desires to give
or take any action which a holder is entitled to give or take under the
indenture, as the case may be, the depositary for such registered global
security would authorize the participants holding the relevant beneficial
interests to give or take that action, and such participants would authorize
beneficial owners owning through such participants to give or take that action
or would otherwise act upon the instructions of beneficial owners holding
through them.
Principal, premium, if any, and interest payments on debt securities
represented by a registered global security registered in the name of a
depositary or its nominee will be made to such depositary or its nominee, as the
case may be, as the registered owner of such registered global security. None of
Cox, the trustee, the registrar or any other agent of Cox, of the trustee or of
the registrar will have any responsibility or liability for any aspect of the
records relating to, or payments made on account of, beneficial ownership
interests in such registered global security, or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
Cox expects that the depositary for any debt securities represented by a
registered global security, or its nominee, upon receipt of any payment of
principal, premium or interest in respect of the registered global security,
will immediately credit participants' accounts with payments in amounts
proportionate to their respective beneficial interests as shown on the records
of such depositary or its nominee. Cox also expects that payments by
participants to owners of beneficial interests in the registered global security
held through such participants will be governed by standing customer
instructions and customary practices, and will be the responsibility of those
participants, as is now the case with the securities held for the accounts of
customers in bearer form or registered in street name.
If the depositary for any debt securities represented by a registered
global security is at any time unwilling or unable to continue as depositary, or
ceases to be a clearing agency registered under the Securities Exchange Act of
1934, as amended, and Cox does not appoint a successor depositary registered as
a clearing agency under the Exchange Act within 90 days, Cox will issue such
debt securities in definitive form in exchange for such registered global
security. In addition, Cox may at any time and in its sole discretion determine
not to have any of the debt securities of a series represented by one or more
registered global securities and, in such event, will issue such debt securities
in definitive form in exchange for all of the registered global securities
representing such debt securities. Any debt securities issued in definitive form
in exchange for a registered global security will be registered in such name or
names as the depositary shall instruct the trustee or the registrar. Cox expects
that such instructions, with respect to ownership of beneficial interests in the
registered global security, will be based upon directions received by the
depositary from participants.
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DESCRIPTION OF JUNIOR SUBORDINATED DEBENTURES
GENERAL
The junior subordinated debentures will be issued in one or more series
under a junior subordinated debenture indenture, as supplemented from time to
time, between Cox and The Bank of New York, as the debenture trustee. The junior
subordinated debenture indenture has been qualified under the Trust Indenture
Act, and is subject to, and governed by, the Trust Indenture Act and is included
as an exhibit to the registration statement of which this prospectus is a part.
This summary of certain terms and provisions of the junior subordinated
debentures and the junior subordinated debenture indenture does not purport to
be complete and is subject to, and is qualified in its entirety by reference to,
all of the provisions of such junior subordinated debentures and the junior
subordinated debenture indenture, including the definitions therein of certain
terms, and those terms made a part of the junior subordinated debenture
indenture by the Trust Indenture Act.
The prospectus supplement will describe the specific terms of the junior
subordinated debentures offered thereby, including:
- the specific title and designation, aggregate principal amount, including
any limit on the principal amount, purchase price and denominations of
those junior subordinated debentures;
- the date or dates on which the principal of those junior subordinated
debentures is payable or the method of determining the same, if
applicable;
- the rate or rates, which may be fixed or variable, at which those junior
subordinated debentures will bear interest, if any, or the method of
determining the same, if applicable;
- the date or dates from which interest, if any, shall accrue or the method
of determining the same, if applicable, the interest payment dates, if
any, on which interest will be payable or the manner of determining the
same, if applicable, and the record dates for the determination of
holders to whom interest is payable on those junior subordinated
debentures;
- the duration of the maximum consecutive period that Cox may elect to
defer payments of interest on those junior subordinated debentures;
- any redemption, repayment or sinking fund provisions;
- whether those junior subordinated debentures are convertible into or
exchangeable for Class A common stock or other securities or rights of
Cox or other issuers, or a combination of the foregoing and, if so, the
applicable conversion or exchange terms and conditions;
- any applicable material United States federal income tax consequences;
and
- any other specific terms pertaining to those junior subordinated
debentures, whether in addition to, or modification or deletion of, the
terms described herein.
RANKING
Each series of junior subordinated debentures will rank equally with all
other junior subordinated debentures to be issued by Cox and sold to other
trusts or other entities to be established by Cox that are similar to Cox Trust
and will be unsecured and will rank subordinate and junior in right of payment,
to the extent and in the manner set forth in the junior subordinated debenture
indenture, to all senior indebtedness of Cox as defined in the junior
subordinated debenture indenture. The junior subordinated debenture indenture
will not limit the amount of secured or unsecured debt, including senior
indebtedness as defined in the junior subordinated debenture indenture, that may
be incurred by Cox or its subsidiaries. See "-- Subordination." As of March 31,
1999, the aggregate principal amount of senior indebtedness as defined in the
junior subordinated debenture indenture was approximately $3.5 billion.
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FORM, REGISTRATION AND TRANSFER
The junior subordinated debentures will be issued in fully registered form.
Until any dissolution of Cox Trust, the junior subordinated debentures will be
held in the name of the property trustee in trust for the benefit of the holders
of the related trust securities. If the junior subordinated debentures are
distributed to the holders of the related trust securities, the junior
subordinated debentures will be issued to such holders in the same form as the
trust securities were held. Accordingly, any depositary arrangements for such
junior subordinated debentures are expected to be substantially similar to those
in effect for the trust preferred securities. See "Description of Trust
Preferred Securities -- Global Trust Preferred Securities."
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in the applicable prospectus supplement, payment
of principal of and premium, if any, on and interest on the junior subordinated
debentures will be made at the office of the debenture trustee in The City of
New York or at the office of such paying agent or paying agents as Cox may
designate from time to time, except that at the option of Cox payment of any
interest may be made, except in the case of a global certificate representing
junior subordinated debentures, by:
1. check mailed to the address of the person entitled thereto as such
address shall appear in the applicable securities register for
junior subordinated debentures or
2. transfer to an account maintained by the person entitled thereto as
specified in such securities register, provided that proper
transfer instructions have been received by the relevant record
date.
Payment of any interest on any junior subordinated debenture will be made to the
person in whose name such junior subordinated debenture is registered at the
close of business on the record date for such interest, except in the case of
defaulted interest. Cox may at any time designate additional paying agents or
rescind the designation of any paying agent; provided, however, Cox will at all
times be required to maintain a paying agent in each place of payment for the
junior subordinated debentures.
Any moneys deposited with the debenture trustee or any paying agent, or
then held by Cox in trust, for the payment of the principal of and premium, if
any, on or interest on any junior subordinated debentures and remaining
unclaimed for two years after such principal and premium, if any, or interest
has become due and payable shall, at the request of Cox, be repaid to Cox and
the holder of such junior subordinated debentures shall thereafter look, as a
general unsecured creditor, only to Cox for payment thereof.
OPTION TO EXTEND INTEREST PAYMENT DATE
So long as no debenture event of default has occurred and is continuing,
Cox will have the right under the junior subordinated debenture indenture to
defer the payment of interest on the junior subordinated debentures at any time
or from time to time up to the maximum period specified in the applicable
prospectus supplement for the deferral of interest. Each of these deferral
periods is referred to in this prospectus as an extension period. An extension
period must end on an interest payment date and may not extend beyond the stated
maturity of such junior subordinated debentures. At the end of an extension
period, Cox must pay all interest then accrued and unpaid, together with
interest on the accrued and unpaid interest, to the extent permitted by
applicable law. During an extension period, interest will continue to accrue and
holders of junior subordinated debentures, and holders of the related trust
securities that are outstanding, will be required to accrue such deferred
interest income for United States federal income tax purposes prior to the
receipt of cash attributable to such income, regardless of the method of
accounting used by the holders.
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Prior to the termination of any extension period, Cox may extend such
extension period, provided that such extension does not
- cause such extension period to exceed the maximum extension period,
- end on a date other than an interest payment date, or
- extend beyond the stated maturity of the related junior subordinated
debentures.
Upon the termination of any extension period, or any extension of the related
extension period, and the payment of all amounts then due, Cox may begin a new
extension period, subject to the limitations described above. No interest shall
be due and payable during an extension period except at the end thereof. Cox
must give the debenture trustee notice of its election to begin or extend an
extension period at least five business days prior to the earlier of:
- the date cash distributions on the related trust securities would have
been payable except for the election to begin or extend such extension
period or
- the date Cox Trust is required to give notice to any securities exchange
or to holders of its trust preferred securities of the record date or the
date cash distributions are payable, but in any event not less than five
business days prior to such record date.
The debenture trustee shall give notice of Cox's election to begin or
extend an extension period to the holders of the trust preferred securities.
Subject to the foregoing limitations, there is no limitation on the number of
times that Cox may begin or extend an extension period.
RESTRICTIONS ON CERTAIN PAYMENTS
Cox will covenant that if at any time:
1. there shall have occurred any event of which Cox has actual
knowledge that is, or with the giving of notice or the lapse of
time, or both, would be, a debenture event of default;
2. Cox shall be in default with respect to any of its payment
obligations under the preferred securities guarantee; or
3. Cox shall have given notice of its election to exercise its right
to begin or extend an extension period as provided in the junior
subordinated debenture indenture and shall not have rescinded such
notice, and such extension period, or any extension thereof, shall
have commenced and be continuing,
then it will not:
- declare or pay any dividends or distributions on, or redeem, purchase,
acquire, or make a liquidation payment with respect to, any of Cox's
capital stock; or
- make any payment of principal of or premium, if any, on or interest on or
repay or repurchase or redeem any debt securities of Cox, including other
junior subordinated debentures, that rank equally with or junior in right
of payment to the junior subordinated debentures; or
- make any guarantee payments with respect to any guarantee by Cox of the
debt securities of any subsidiary of Cox, including under any guarantees
to be issued by Cox with respect to securities of other Cox trusts or
entities to be established by Cox similar to Cox Trust, if such guarantee
ranks equally with or junior in right of payment to the junior
subordinated debentures.
These restrictions will not apply to:
- dividends or distributions in shares of, or options, warrants or rights
to subscribe for or purchase shares of, Class A common stock and Class C
common stock of Cox;
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- any declaration of a dividend in connection with the implementation of a
stockholders' rights plan, or the issuance of stock under any such plan
in the future, or the redemption or repurchase of any such rights
pursuant thereto;
- payments under the preferred securities guarantee;
- as a result of reclassification of Cox's capital stock or the exchange or
conversion of one class or series of Cox's capital stock for another
class or series of Cox's capital stock;
- the purchase of fractional interests in shares of Cox's capital stock
pursuant to the conversion or exchange provisions of such capital stock
or the security being converted or exchanged; and
- purchases of Class A and Class C common stock related to the issuance of
Class A and Class C common stock or rights under any of Cox's benefit
plans for its directors, officers, or employees or any of Cox's dividend
reinvestment plans.
So long as the trust securities remain outstanding, Cox also will covenant:
- to maintain 100% direct or indirect ownership of the related trust common
securities, provided that any permitted successor of Cox under the junior
subordinated debenture indenture may succeed to Cox's ownership of such
trust common securities;
- to use its best efforts to cause Cox Trust
- to remain a business trust, except in connection with the distribution
of junior subordinated debentures to the holders of related trust
securities in liquidation of Cox Trust, the conversion, exchange or
redemption of all of such trust securities, or certain mergers,
consolidations or amalgamations, each as permitted by the trust
agreement,
- to otherwise continue to be classified as a grantor trust for United
States federal income tax purposes;
- to use its best efforts to cause each holder of its trust securities to
be treated as owning an undivided beneficial interest in the related
junior subordinated debentures; and
- not to cause, as sponsor of Cox Trust, or to permit, as the trust common
securities holder, the dissolution, liquidation or winding-up of Cox
Trust, except as provided in the trust agreement.
MODIFICATION OF JUNIOR SUBORDINATED DEBENTURE INDENTURE
From time to time, Cox and the debenture trustee may, without the consent
of the holders of the junior subordinated debentures, amend, waive or supplement
the junior subordinated debenture indenture for specified purposes, including,
among other things, curing ambiguities or adding provisions, provided that any
such action does not materially adversely affect the interests of the holders of
the junior subordinated debentures, and maintaining the qualification of the
junior subordinated debenture indenture under the Trust Indenture Act. The
junior subordinated debenture indenture will permit Cox and the debenture
trustee, with the consent of the holders of a majority in principal amount of
all outstanding junior subordinated debentures affected thereby, to modify the
junior subordinated debenture indenture in a manner affecting the rights of the
holders of junior subordinated debentures; provided, however, that no such
modification may, without the consent of the holder of each outstanding junior
subordinated debenture so affected:
- change the stated maturity or reduce the principal of any such junior
subordinated debentures;
- change the interest rate or the manner of calculation of the interest
rate or extend the time of payment of interest on any such junior
subordinated debentures except pursuant to Cox's right under the junior
subordinated debenture indenture to defer the payment of interest as
provided therein (see "-- Option to Extend Interest Payment Date");
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- change any of the conversion, exchange or redemption provisions
applicable to any such junior subordinated debentures;
- change the currency in respect of which payments of principal of or any
premium or interest on any such junior subordinated debentures are to be
made;
- change the right of holders of trust securities to bring a direct action
in respect of any required payments or conversion or exchange rights;
- impair or affect the right of any holder of any such junior subordinated
debentures to institute suit for the payment of the principal thereof or
premium, if any, or interest thereon or for the conversion or exchange of
any such junior subordinated debentures in accordance with their terms;
- change the subordination provisions adversely to the holders of the
junior subordinated debentures; or
- reduce the percentage of principal amount of junior subordinated
debentures the holders of which are required to consent to any such
modification of the junior subordinated debenture indenture.
DEBENTURE EVENTS OF DEFAULT
The following described events with respect to any series of junior
subordinated debentures will constitute a debenture event of default, whatever
the reason for such debenture event of default and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body, unless such event is specifically deleted
or modified in or pursuant to the supplemental indenture, board resolution or
officers' certificate establishing the terms of such series pursuant to the
junior subordinated debenture indenture:
1. failure for 30 days to pay any interest on that series of junior
subordinated debentures when due, subject to any permitted
deferral; provided that, during any extension period for such
series of junior subordinated debentures, failure to pay interest
on such series of junior subordinated debentures shall not
constitute a debenture event of default; or
2. failure to pay any principal of or premium, if any, on that series
of junior subordinated debentures when due, whether at maturity,
upon any redemption, by declaration of acceleration of maturity or
otherwise; or
3. if applicable, failure by Cox to deliver the required securities or
other rights upon an appropriate conversion or exchange election by
holders of that series of junior subordinated debentures or the
related trust preferred securities; or
4. failure to observe or perform any other agreement or covenant
contained in the junior subordinated debenture indenture in respect
of that series of junior subordinated debentures for 90 days after
written notice to Cox from the debenture trustee or the holders of
at least 25% in aggregate outstanding principal amount of that
series of junior subordinated debentures; or
5. certain events in bankruptcy, insolvency or reorganization of Cox.
The holders of a majority in aggregate outstanding principal amount of the
junior subordinated debentures of any series have, subject to certain
exceptions, the right to direct the time, method and place of conducting any
proceeding for any remedy available to the debenture trustee in respect of such
junior subordinated debentures. The debenture trustee or the holders of at least
25% in aggregate outstanding principal amount of the junior subordinated
debentures of any series may declare the principal of and any accrued interest
on such junior subordinated debentures due and payable immediately upon a
debenture event of default, other than a debenture event of default referred to
in paragraph (5) above, which shall result in the immediate acceleration of the
junior subordinated debentures. The holders of a majority in aggregate
outstanding principal amount of the junior subordinated debentures of any series
may annul such
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declaration and waive the default in respect of such junior subordinated
debentures if the default, other than the non-payment of the principal and
interest of the junior subordinated debentures which has become due solely by
such acceleration, has been cured and a sum sufficient to pay all matured
installments of interest and premium, if any, and principal due otherwise than
by acceleration has been deposited with the debenture trustee.
The holders of a majority in aggregate outstanding principal amount of the
junior subordinated debentures of any series may, on behalf of the holders of
all of the junior subordinated debentures of such series, waive any past
default, except:
- a default in the payment of the principal of or premium, if any, on or
interest on the junior subordinated debentures, unless that default has
been cured and a sum sufficient to pay all matured installments of
interest and premium, if any, and principal due otherwise than by
acceleration has been deposited with the debenture trustee; or
- a default in respect of a covenant or provision which under the junior
subordinated debenture indenture cannot be modified or amended without
the consent of the holder of each outstanding junior subordinated
debenture of such series.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF TRUST PREFERRED SECURITIES
To the extent any action under the junior subordinated debenture indenture
is entitled to be taken by the holders of at least a specified percentage of
junior subordinated debentures, holders of the corresponding trust preferred
securities may take such action if such action is not taken by the property
trustee of Cox Trust. Notwithstanding the foregoing, if a debenture event of
default has occurred and is continuing and is attributable either to:
- the failure of Cox to pay the principal of or premium, if any, on or
interest on the junior subordinated debentures on the due date or
- the failure by Cox to deliver the required securities or other rights
upon an appropriate conversion or exchange right election,
a holder of the related trust preferred securities may institute a legal
proceeding directly against Cox for enforcement of payment to such holder of the
principal of or premium, if any, on or interest on such junior subordinated
debentures having a principal amount equal to the liquidation amount of the
trust preferred securities held by such holder or for enforcement of such
conversion or exchange rights, as the case may be, which is referred to as a
direct action. Cox may not amend the junior subordinated debenture indenture to
remove the foregoing right to bring a direct action without the prior written
consent of the holders of all of the trust preferred securities outstanding. If
the right to bring a direct action is removed, Cox Trust may become subject to
the reporting obligations under the Exchange Act. Notwithstanding any payments
made to a holder of trust preferred securities by Cox in connection with a
direct action, Cox shall remain obligated to pay the principal of and premium,
if any, on and interest on the related junior subordinated debentures, and Cox
shall be subrogated to the rights of the holder of such trust preferred
securities with respect to payments on the trust preferred securities to the
extent of any payments made by Cox to such holder in any direct action.
The holders of the trust preferred securities will not be able to exercise
directly any remedies, other than those set forth in the preceding paragraph,
available to the holders of the related junior subordinated debentures unless an
event of default has occurred and is continuing under the trust agreement. See
"Description of Trust Preferred Securities -- Events of Default; Notice."
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CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS
Cox shall not consolidate with or merge into any other person or convey,
transfer or lease its properties and assets as an entirety or substantially as
an entirety to any person, and no person shall consolidate with or merge into
Cox or convey, transfer or lease its properties and assets as an entirety or
substantially as an entirety to Cox, unless:
- in case Cox consolidates with or merges into another person or conveys or
transfers its properties and assets as an entirety or substantially as an
entirety to any person, the successor person is organized under the laws
of the United States or any State or the District of Columbia, and such
successor person expressly assumes Cox's obligations under the junior
subordinated debentures and the preferred securities guarantee;
- immediately after giving effect thereto, no debenture event of default,
and no event which, after notice or lapse of time or both, would become a
debenture event of default, shall have occurred and be continuing; and
- certain other conditions as prescribed in the junior subordinated
debenture indenture are met.
SATISFACTION AND DISCHARGE
The junior subordinated debenture indenture will cease to be of further
effect, except as to Cox's obligations to pay all other sums due pursuant to the
junior subordinated debenture indenture and to provide the required officers'
certificates and opinions of counsel, and Cox will be deemed to have satisfied
and discharged the junior subordinated debenture indenture, when, among other
things, all junior subordinated debentures not previously delivered to the
debenture trustee for cancellation
- have become due and payable or
- will become due and payable at maturity or upon redemption within one
year,
and Cox deposits or causes to be deposited with the debenture trustee funds, in
trust, for the purpose and in an amount sufficient to pay and discharge the
entire indebtedness on the junior subordinated debentures not previously
delivered to the debenture trustee for cancellation, for the principal and
premium, if any, and interest to the date of the deposit or to the stated
maturity thereof, as the case may be.
SUBORDINATION
The junior subordinated debentures will rank subordinate and junior in
right of payment to all senior indebtedness to the extent provided in the junior
subordinated debenture indenture. Upon any payment or distribution of assets to
creditors upon any liquidation, dissolution, winding-up, reorganization,
assignment for the benefit of creditors, marshaling of assets or any bankruptcy,
insolvency, debt restructuring or similar proceedings in connection with any
insolvency or bankruptcy proceeding of Cox, the holders of senior indebtedness
will first be entitled to receive payment in full of such senior indebtedness
before the holders of junior subordinated debentures will be entitled to receive
or retain any payment in respect thereof.
In the event of the acceleration of the maturity of junior subordinated
debentures, the holders of all senior indebtedness outstanding at the time of
such acceleration will first be entitled to receive payment in full of such
senior indebtedness before the holders of junior subordinated debentures will be
entitled to receive or retain any payment in respect of the junior subordinated
debentures.
No payments on account of principal or premium, if any, or interest in
respect of the junior subordinated debentures may be made if there shall have
occurred and be continuing a default in any payment with respect to senior
indebtedness, or an event of default with respect to any senior indebtedness
resulting in the acceleration of the maturity thereof, or if any judicial
proceeding shall be pending with respect to any such default.
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Indebtedness shall mean:
1. every obligation of Cox for money borrowed;
2. every obligation of Cox evidenced by bonds, debentures, notes or
other similar instruments, including obligations incurred in
connection with the acquisition of property, assets or businesses;
3. every reimbursement obligation of Cox with respect to letters of
credit, banker's acceptances or similar facilities issued for the
account of Cox;
4. every obligation of Cox issued or assumed as the deferred purchase
price of property or services, excluding trade accounts payable or
accrued liabilities arising in the ordinary course of business;
5. every capital lease obligation of Cox which generally accepted
accounting principles require to be classified and accounted for as
a capital lease on Cox's balance sheet;
6. all indebtedness of Cox, whether incurred on or prior to the date
of the junior subordinated debenture indenture or thereafter
incurred, for claims in respect of derivative products, including
interest rate, foreign exchange rate and commodity forward
contracts, options and swaps and similar arrangements;
7. every obligation of the type referred to in paragraphs (1) through
(6) of another person and all dividends of another person the
payment of which, in either case, Cox has guaranteed or is
responsible or liable for, directly or indirectly, as obligor or
otherwise; and
8. obligations of the type referred to in paragraphs (1) through (7)
of another person secured by any lien on any property or asset of
Cox, whether or not such obligation is assumed by Cox; and all
deferrals, renewals, extensions and refundings of, and amendments,
modifications and supplements to, any of the foregoing obligations.
Indebtedness ranking on a parity with the junior subordinated debentures
shall mean
1. Indebtedness, whether outstanding on the date of execution of the
junior subordinated debenture indenture or thereafter created,
assumed or incurred, to the extent such Indebtedness specifically
by its terms ranks equally with and not prior to the junior
subordinated debentures in the right of payment upon the happening
of the dissolution, winding-up, liquidation or reorganization of
Cox, and
2. all other debt securities, and guarantees in respect of those debt
securities, issued to any other trust, or a trustee of such trust,
partnership or other entity affiliated with Cox that is a financing
vehicle of Cox, which is referred to as a financing entity, in
connection with the issuance by such financing entity of equity
securities or other securities guaranteed by Cox pursuant to an
instrument that ranks equally with or junior in right of payment to
the preferred securities guarantee.
The securing of any Indebtedness otherwise constituting indebtedness ranking on
a parity with the junior subordinated debentures shall not prevent such
Indebtedness from constituting indebtedness ranking on a parity with the junior
subordinated debentures.
Indebtedness ranking junior to the junior subordinated debentures shall
mean any Indebtedness, whether outstanding on the date of execution of the
junior subordinated debenture indenture or thereafter created, assumed or
incurred, to the extent such Indebtedness by its terms ranks junior to and not
equally with or prior to:
- the junior subordinated debentures; and
- any other Indebtedness ranking equally with the junior subordinated
debentures in right of payment upon the happening of the dissolution,
winding-up, liquidation or reorganization of Cox.
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The securing of any Indebtedness otherwise constituting indebtedness ranking
junior to the junior subordinated debentures shall not be deemed to prevent such
Indebtedness from constituting Indebtedness ranking junior to the junior
subordinated debentures.
Senior indebtedness shall mean all Indebtedness, whether outstanding on the
date of execution of the junior subordinated debenture indenture or thereafter
created, assumed or incurred, except indebtedness ranking on a parity with the
junior subordinated debentures or indebtedness ranking junior to the junior
subordinated debentures.
GOVERNING LAW
The junior subordinated debenture indenture and the junior subordinated
debentures will be governed by and construed in accordance with the laws of the
State of New York.
INFORMATION CONCERNING THE DEBENTURE TRUSTEE
The debenture trustee shall be subject to all the duties and
responsibilities specified with respect to an indenture trustee under the Trust
Indenture Act. Subject to the foregoing, the debenture trustee will not be under
any obligation to exercise any of the powers vested in it by the junior
subordinated debenture indenture at the request of any holder of junior
subordinated debentures, unless offered reasonable indemnity by such holder
against the costs, expenses and liabilities which might be incurred thereby. The
debenture trustee will not be required to expend or risk its own funds or
otherwise incur personal financial liability in the performance of its duties if
the debenture trustee reasonably believes that repayment or adequate indemnity
is not reasonably assured to it.
DESCRIPTION OF TRUST PREFERRED SECURITIES
The trust preferred securities will be issued by Cox Trust under the trust
agreement and will represent beneficial interests in Cox Trust. The holders of
such beneficial interests will be entitled to a preference over the trust common
securities of Cox Trust with respect to the payment of distributions and amounts
payable on redemption of the trust preferred securities or the liquidation of
Cox Trust under the circumstances described under "-- Subordination of Trust
Common Securities." The trust agreement has been qualified under the Trust
Indenture Act and is subject to, and governed by, the Trust Indenture Act. This
summary of certain terms and provisions of the trust preferred securities and
the trust agreement does not purport to be complete and is subject to, and is
qualified in its entirety by reference to, all of the provisions of the trust
preferred securities and the trust agreement, including the definitions therein
of certain terms, and those made a part of the trust agreement by the Trust
Indenture Act.
Reference is made to the prospectus supplement for a description of the
specific terms of the trust preferred securities offered thereby, including:
- the annual distribution rate or method of calculation of the distribution
rate for such trust preferred securities and, if applicable, the dates
from which and upon which such distributions shall accumulate and be
payable and the record dates therefor, and the maximum extension period
for which such distributions may be deferred;
- the liquidation amount per trust preferred security which shall be paid
out of the assets of Cox Trust to the holders thereof upon voluntary or
involuntary dissolution, winding-up and liquidation of Cox Trust;
- the obligation or right, if any, of Cox Trust to purchase or redeem its
trust preferred securities and the price or prices at which, the date or
dates on which or period or periods within which and the terms and
conditions upon which, such trust preferred securities shall or may be
purchased or redeemed, in whole or in part, pursuant to such obligation
or right;
- the terms and conditions, if any, upon which such trust preferred
securities may be converted or exchanged, in addition to the
circumstances described herein, into other securities or rights, or a
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combination of the foregoing, including the name of the issuer of such
securities or rights, the initial conversion or exchange price or rate
per trust preferred security and the date or dates on which or period or
periods within which such conversion or exchange may be effected;
- if applicable, any securities exchange upon which such trust preferred
securities shall be listed;
- whether such trust preferred securities are issuable in book-entry form
only and, if so, the identity of the depositary and disclosure relating
to the depositary arrangements; and
- any other rights, preferences, privileges, limitations or restrictions of
such trust preferred securities consistent with the trust agreement or
with law which may differ from those described in this prospectus.
Certain material United States federal income tax considerations applicable to
any offering of trust preferred securities will also be described in the
applicable prospectus supplement.
GENERAL
The trust preferred securities of Cox Trust will rank equally, and payments
will be made thereon pro rata, with the trust common securities of Cox Trust
except as described under "-- Subordination of Trust Common Securities." The
proceeds from the sale of trust preferred securities and trust common securities
by Cox Trust will be used by Cox Trust to purchase an aggregate principal amount
of junior subordinated debentures of Cox equal to the aggregate liquidation
amount of such trust preferred securities and trust common securities. Legal
title to such junior subordinated debentures will be held by the property
trustee of Cox Trust for the benefit of the holders of the related trust
securities. In addition, Cox will execute a preferred securities guarantee for
the benefit of the holders of the related trust preferred securities. The
preferred securities guarantee will not guarantee payment of distributions or
amounts payable on redemption of the trust preferred securities or liquidation
of Cox Trust when Cox Trust does not have funds legally available for the
payment thereof. See "Description of Preferred Securities Guarantee."
The revenue of Cox Trust available for distribution to holders of its trust
preferred securities will be limited to payments received under the related
junior subordinated debentures which Cox Trust purchased with the proceeds from
the sale of its trust securities. If Cox fails to make a required payment in
respect of such junior subordinated debentures, Cox Trust will not have
sufficient funds to make the related payments, including distributions, in
respect of its trust preferred securities.
DEFERRAL OF DISTRIBUTIONS
So long as no debenture event of default has occurred and is continuing,
Cox will have the right under the junior subordinated debenture indenture to
defer the payment of interest on the junior subordinated debentures at any time
or from time to time for up to the maximum extension period specified in the
applicable prospectus supplement, provided that an extension period must end on
an interest payment date and may not extend beyond the stated maturity of such
junior subordinated debentures. If Cox elects to exercise such right,
distributions on the related trust preferred securities will be deferred during
any such extension period. Distributions to which holders of the trust preferred
securities are entitled during any extension period will continue to accumulate
additional distributions thereon. Cox has no current intention to exercise its
right to defer payments of interest on the junior subordinated debentures Cox
may issue and, accordingly, distributions on the related trust preferred
securities.
REDEMPTION
Upon the repayment at the stated maturity or redemption, in whole or in
part, prior to the stated maturity of the junior subordinated debentures, the
proceeds from such repayment or redemption shall be applied by the property
trustee to redeem an aggregate liquidation amount of the related trust
securities equal to the aggregate principal amount of such junior subordinated
debentures so repaid or redeemed, upon not less than 30 nor more than 60 days
prior written notice, at a redemption price equal to such
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aggregate liquidation amount plus accumulated distributions to the redemption
date. Any redemption of trust securities shall be made and the applicable
redemption price shall be payable on the redemption date only to the extent that
Cox Trust has funds legally available for the payment thereof. See
"-- Subordination of Trust Common Securities."
If less than all of the junior subordinated debentures are to be redeemed
prior to the stated maturity thereof, then the proceeds of such redemption shall
be used to redeem the related trust securities on a pro rata basis among the
trust preferred securities and the trust common securities of Cox Trust except
as described under "-- Subordination of Trust Common Securities." If less than
all of the trust preferred securities held in book-entry form, if any, are to be
redeemed, such trust preferred securities will be redeemed in accordance with
the procedures of The Depository Trust Corporation. See "-- Global Trust
Preferred Securities."
REDEMPTION PROCEDURES
If Cox Trust gives a notice of redemption in respect of its trust preferred
securities, then, by 12:00 noon, New York City time, on the redemption date, to
the extent funds are legally available,
- with respect to trust preferred securities held by The Depository Trust
Corporation or its nominee, the property trustee will deposit, or cause
the paying agent to deposit, irrevocably with The Depository Trust
Corporation funds sufficient to pay the applicable redemption price, and
- with respect to trust preferred securities held in certificated form, the
property trustee will irrevocably deposit with the paying agent funds
sufficient to pay the applicable redemption price and will give such
paying agent irrevocable instructions and authority to pay the applicable
redemption price to the holders thereof upon surrender of their
certificates evidencing the trust preferred securities.
If notice of redemption shall have been given and funds irrevocably
deposited as required, then, upon the date of such deposit, all rights of the
holders of the trust preferred securities called for redemption will cease,
except the right of such holders to receive the applicable redemption price, but
without interest thereon, and such trust preferred securities will cease to be
outstanding. In the event that any redemption date is not a business day, then
the applicable redemption price payable on that date will be paid on the next
succeeding day that is a business day, without any interest or other payment in
respect of any such delay, with the same force and effect as if made on that
date. In the event that payment of the applicable redemption price is improperly
withheld or refused and not paid either by Cox Trust or by Cox pursuant to the
preferred securities guarantee as described under "Description of Preferred
Securities Guarantee,"
- distributions on the related trust preferred securities will continue to
accumulate from the redemption date originally established by Cox Trust
to the date such applicable redemption price is actually paid, and
- the actual payment date will be the redemption date for purposes of
calculating the applicable redemption price.
Subject to applicable law, including, without limitation, United States
federal securities law, Cox or its subsidiaries may at any time and from time to
time purchase outstanding trust preferred securities by tender, in the open
market or by private agreement.
LIQUIDATION OF COX TRUST AND DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES
Cox will have the right at any time to dissolve Cox Trust and cause the
related junior subordinated debentures to be distributed to the holders of the
trust securities of Cox Trust in liquidation of Cox Trust after satisfaction, or
reasonable provision for satisfaction, of liabilities to creditors of Cox Trust
as required by applicable law. Such right is subject to Cox having received an
opinion of counsel to the effect that such distribution will not be a taxable
event to holders of the trust preferred securities of Cox Trust.
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Cox Trust shall automatically dissolve upon the first to occur of:
1. certain events of bankruptcy, dissolution or liquidation of Cox;
2. the distribution of the related junior subordinated debentures to
the holders of the trust securities of Cox Trust, if Cox, as
sponsor, has given written direction to the property trustee to
dissolve Cox Trust, which direction is optional and, except as
described above, wholly within the discretion of Cox, as sponsor;
3. the conversion, exchange or redemption of all of the trust
securities of Cox Trust;
4. expiration of the term of Cox Trust; and
5. the entry of an order for the dissolution of Cox Trust by a court
of competent jurisdiction.
If a dissolution occurs as described in paragraph (1), (2), (4) or (5)
above, Cox Trust shall be liquidated by the issuer trustees as expeditiously as
the issuer trustees determine to be possible by distributing, after
satisfaction, or reasonable provision for satisfaction, of liabilities to
creditors of Cox Trust as provided by applicable law, to the holders of the
trust securities and the related junior subordinated debentures, unless such
distribution is determined by the property trustee not to be practicable, in
which event such holders will be entitled to receive out of the assets of Cox
Trust legally available for distribution to holders, after satisfaction of
liabilities to creditors of Cox Trust as provided by applicable law, an amount
equal to the aggregate of the liquidation amount per trust security specified in
the applicable prospectus supplement plus accumulated distributions thereon to
the date of payment. If the liquidation distribution can be paid only in part
because Cox Trust has insufficient assets legally available to pay in full the
aggregate liquidation distribution, then the amounts payable directly by Cox
Trust on its trust securities shall be paid on a pro rata basis, except that if
a debenture event of default has occurred and is continuing, the trust preferred
securities of Cox Trust shall have a priority over the trust common securities
of Cox Trust in respect of such amounts. See "-- Subordination of Trust Common
Securities."
After a date is fixed for any distribution of junior subordinated
debentures to holders of the related trust securities:
- such trust securities will no longer be deemed to be outstanding;
- each registered global certificate, if any, representing such trust
securities will be exchanged for a registered global certificate
representing the junior subordinated debentures to be delivered upon such
distribution; and
- any trust securities in certificated form will be deemed to represent
junior subordinated debentures having a principal amount equal to the
liquidation amount of such trust securities, and bearing accrued interest
in an amount equal to the accumulated distributions on such trust
securities until such certificates are presented to the administrative
trustees or their agent for cancellation, whereupon Cox will issue to
such holder, and the debenture trustee will authenticate, junior
subordinated debentures in certificated form.
There can be no assurance as to the market prices for the trust preferred
securities or the junior subordinated debentures that may be distributed in
exchange for such trust preferred securities if a dissolution and liquidation of
Cox Trust were to occur. Accordingly, the trust preferred securities that an
investor may purchase, or the junior subordinated debentures that the investor
may receive on dissolution and liquidation of Cox Trust, may trade at a discount
to the price that the investor paid to purchase such trust preferred securities.
SUBORDINATION OF TRUST COMMON SECURITIES
Payment of distributions on, and the applicable redemption price of, trust
securities shall be made pro rata among the trust preferred securities and the
trust common securities of Cox Trust based on their respective liquidation
amounts; provided, however, that if on any distribution date or redemption date
a debenture event of default has occurred and is continuing, no payment of any
distribution on, or applicable
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redemption price of, any of the trust common securities of Cox Trust, and no
other payment on account of the redemption, liquidation or other acquisition of
such trust common securities, shall be made unless payment in full in cash of
all accumulated distributions on all of the outstanding trust preferred
securities of Cox Trust for all distribution periods terminating on or prior
thereto, or in the case of payment of the applicable redemption price, the full
amount of such redemption price, shall have been made or provided for, and all
funds available to the property trustee shall first be applied to the payment in
full in cash of all distributions on, or applicable redemption price of, such
trust preferred securities then due and payable.
Upon the occurrence and continuance of an event of default under the trust
agreement, Cox, as the trust common securities holder of Cox Trust, will be
deemed to have waived any right to act with respect to such event of default
until the effect of such event of default shall have been cured, waived or
otherwise eliminated. Until any such event of default has been so cured, waived
or otherwise eliminated, the property trustee shall act solely on behalf of the
holders of the trust preferred securities of Cox Trust and not on behalf of Cox
as the trust common securities holder, and only the holders of such trust
preferred securities will have the right to direct the property trustee to act
on their behalf.
EVENTS OF DEFAULT; NOTICE
The occurrence of a debenture event of default will constitute an event of
default under the trust agreement. See "Description of Junior Subordinated
Debentures -- Debenture Events of Default". Within ten business days after the
occurrence of an event of default under the trust agreement actually known to
the property trustee, the property trustee shall transmit notice of such event
of default to the holders of the trust preferred securities of Cox Trust, the
administrative trustees and Cox, as sponsor, unless such event of default shall
have been cured or waived.
For a discussion of the limited circumstances in which holders of trust
preferred securities may bring a direct action against Cox, see "Description of
Junior Subordinated Debentures -- Enforcement of Certain Rights by Holders of
Trust Preferred Securities."
REMOVAL OF TRUSTEES
Unless a debenture event of default has occurred and is continuing, any
issuer trustee may be removed at any time by Cox as the trust common securities
holder of Cox Trust. If a debenture event of default has occurred and is
continuing, the property trustee and the Delaware trustee may be removed at such
time only by the holders of a majority in liquidation amount of the outstanding
trust preferred securities of Cox Trust. In no event will the holders of the
trust preferred securities have the right to vote to appoint, remove or replace
the administrative trustees, which voting rights are vested exclusively in Cox
as the trust common securities holder. No resignation or removal of an issuer
trustee, and no appointment of a successor trustee, shall be effective until the
acceptance of appointment by the successor trustee in accordance with the
provisions of the trust agreement.
MERGER OR CONSOLIDATION OF TRUSTEES
Any person into which the property trustee, the Delaware trustee or any
administrative trustee that is not a natural person may be merged or converted
or with which it may be consolidated, or any person resulting from any merger,
conversion or consolidation to which such issuer trustee shall be a party, or
any person succeeding to all or substantially all the corporate trust business
of such issuer trustee, shall be the successor of such issuer trustee under the
trust agreement, provided such person shall be otherwise qualified and eligible.
MERGERS, CONVERSIONS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF COX TRUST
Cox Trust may not merge with or into, convert into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets as an entirety or substantially as an entirety to any corporation or
other person, except as described below or as otherwise described under
"-- Liquidation of Cox Trust and Distribution of Junior Subordinated
Debentures." Cox Trust may, at the request of Cox, as
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sponsor, with the consent of the administrative trustees but without the consent
of the holders of its trust preferred securities, merge with or into, convert
into, consolidate, amalgamate, or be replaced by or convey, transfer or lease
its properties and assets as an entirety or substantially as an entirety to a
trust organized as such under the laws of any State; provided that:
- such successor entity either
- expressly assumes all of the obligations of Cox Trust with respect to
the trust securities of Cox Trust, or
- substitutes for the trust securities of Cox Trust other securities
having substantially the same terms as such trust securities so long as
the successor securities rank the same as such trust securities rank in
priority with respect to distributions and payments upon liquidation,
redemption and otherwise;
- Cox expressly appoints a trustee of such successor entity possessing the
same powers and duties as the property trustee with respect to the
related junior subordinated debentures;
- the successor securities are listed, or any successor securities will be
listed upon notification of issuance, on each national securities
exchange or other organization on which the trust securities of Cox Trust
are then listed, if any;
- such merger, conversion, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not cause the trust securities,
including any successor securities, of Cox Trust or the related junior
subordinated debentures to be downgraded or placed under surveillance or
review by any nationally recognized statistical rating organization;
- such merger, conversion, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the holders of the trust securities,
including any successor securities, of Cox Trust in any material respect,
other than any dilution of such holders' interests in the new entity;
- such successor entity has a purpose substantially identical to that of
Cox Trust;
- prior to such merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease, Cox has received an opinion
from independent counsel to Cox Trust experienced in such matters to the
effect that
- such merger, conversion, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the holders of the trust securities,
including any successor securities, of Cox Trust in any material
respect, other than any dilution of such holders' interests in the new
entity, and
- following such merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither Cox Trust nor such
successor entity will be required to register as an investment company
under the Investment Company Act of 1940, as amended; and
- Cox or any permitted successor or assignee owns all of the common
securities of such successor entity and guarantees the obligations of
such successor entity under the successor securities at least to the
extent provided by the preferred securities guarantee and the common
securities guarantee for the benefit of the owner of the common
securities of Cox Trust.
Notwithstanding the foregoing, Cox Trust shall not, except with the consent of
each holder of its trust securities, consolidate, amalgamate, merge with or
into, or be replaced by or convey, transfer or lease its properties and assets
as an entirety or substantially as an entirety to any other entity or permit any
other entity to consolidate, amalgamate, merge with or into, or replace it, if
such consolidation, amalgamation, merger, replacement, conveyance, transfer or
lease would cause Cox Trust or the successor entity not to be classified as a
grantor trust for United States federal income tax purposes.
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VOTING RIGHTS; AMENDMENT OF THE TRUST AGREEMENT
Except as provided below and under "-- Mergers, Conversions,
Consolidations, Amalgamations or Replacements of Cox Trust" and "Description of
Preferred Securities Guarantee -- Amendments and Assignment" and as otherwise
required by law and the trust agreement, the holders of trust preferred
securities will have no voting rights.
The trust agreement may be amended from time to time by Cox, the property
trustee and the administrative trustees, without the consent of the holders of
the trust securities of Cox Trust,
- to cure any ambiguity, correct or supplement any provisions in the trust
agreement that may be inconsistent with any other provision, or to make
any other provisions with respect to matters or questions arising under
the trust agreement, which shall not be inconsistent with the other
provisions of such trust agreement, or
- to modify, eliminate or add to any provisions of such trust agreement to
such extent as shall be necessary to ensure that Cox Trust will be
classified for United States federal income tax purposes as a grantor
trust at all times that any of its trust securities are outstanding or to
ensure that Cox Trust will not be required to register as an investment
company under the Investment Company Act;
provided, however, that in each case, such action shall not adversely affect in
any material respect the interests of the holders of such trust securities.
A trust agreement may be amended by the issuer trustees and Cox
- with the consent of holders of a majority in liquidation amount of the
outstanding trust securities of Cox Trust, and
- upon receipt by the issuer trustees of an opinion of counsel experienced
in such matters to the effect that such amendment or the exercise of any
power granted to the issuer trustees in accordance with such amendment
will not affect Cox Trust's status as a grantor trust for United States
federal income tax purposes or Cox Trust's exemption from status as an
investment company under the Investment Company Act;
provided, however, that, without the consent of each holder of such trust
securities, the trust agreement may not be amended to:
- change the distribution rate or manner of calculation of the distribution
rate, amount, timing or currency or otherwise adversely affect the method
of any required payment;
- change the purpose of Cox Trust;
- authorize the issuance of any additional beneficial interests in Cox
Trust;
- change the conversion, exchange or redemption provisions;
- change the conditions precedent for Cox to elect to dissolve Cox Trust
and distribute the related junior subordinated debentures to the holders
of such trust securities;
- change the liquidation distribution or other provisions relating to the
distribution of amounts payable upon the dissolution and liquidation of
Cox Trust;
- affect the limited liability of any holder of such trust securities; or
- restrict the right of a holder of such trust securities to institute suit
for the enforcement of any required payment on or after the due date
therefor or for the conversion or exchange of such trust securities in
accordance with their terms.
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So long as any junior subordinated debentures are held by the property
trustee, the issuer trustees shall not:
- direct the time, method and place of conducting any proceeding for any
remedy available to such debenture trustee, or execute any trust or power
conferred on the debenture trustee, with respect to the junior
subordinated debentures;
- waive certain past defaults under the junior subordinated debenture
indenture;
- exercise any right to rescind or annul a declaration of acceleration of
the maturity of the principal of such junior subordinated debentures; or
- consent to any amendment, modification or termination of the junior
subordinated debenture indenture or such junior subordinated debentures
where such consent shall be required, without, in each case, obtaining
the prior approval of the holders of a majority in liquidation amount of
all outstanding trust preferred securities of Cox Trust;
provided, however, that where a consent under the junior subordinated debenture
indenture would require the consent of each holder of junior subordinated
debentures affected thereby, no such consent shall be given by the property
trustee without the prior approval of each holder of the related trust preferred
securities. The issuer trustees shall not revoke any action previously
authorized or approved by a vote of the holders of trust preferred securities
except by subsequent vote of such holders. The property trustee shall notify
each holder of trust preferred securities of any notice of default with respect
to the related junior subordinated debentures. In addition to obtaining
approvals of holders of trust preferred securities referred to above, prior to
taking any of the foregoing actions, the issuer trustees shall obtain an opinion
of counsel experienced in such matters to the effect that Cox Trust will not be
classified as an association taxable as a corporation for United States federal
income tax purposes on account of such action.
Any required approval of holders of trust preferred securities may be given
at a meeting of such holders convened for such purpose or pursuant to written
consent. The property trustee will cause a notice of any meeting at which
holders of trust preferred securities are entitled to vote to be given to each
holder of record of trust preferred securities in the manner set forth in the
trust agreement.
Notwithstanding that holders of trust preferred securities are entitled to
vote or consent under any of the circumstances referred to above, any trust
preferred securities that are owned by Cox or any affiliate of Cox shall, for
purposes of such vote or consent, be treated as if they were not outstanding.
GLOBAL TRUST PREFERRED SECURITIES
If specified in the prospectus supplement, trust preferred securities may
be represented by one or more global certificates deposited with, or on behalf
of, The Depository Trust Corporation, or other depositary identified in such
prospectus supplement, or a nominee thereof, in each case for credit to an
account of a participant in The Depository Trust Corporation or other
depositary. The identity of the depositary and the specific terms of the
depositary arrangements with respect to the trust preferred securities to be
represented by one or more global certificates will be described in the
prospectus supplement. However, unless otherwise specified in the prospectus
supplement, The Depository Trust Corporation will be the depositary and the
depositary arrangements described with respect to the debt securities will apply
to such trust preferred securities as well, except all references to Cox shall
include Cox Trust and all references to the applicable indenture will refer to
the trust agreement. See "Description of Debt Securities -- Global Securities."
PAYMENT AND PAYING AGENT
Payments in respect of any global certificate representing trust preferred
securities shall be made to Cede & Co. as nominee of The Depository Trust
Corporation, or other applicable depositary or its nominee, which shall credit
the relevant accounts at The Depository Trust Corporation or such other
depositary on the applicable payment dates, while payments in respect of trust
preferred securities in
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certificated form shall be made by check mailed to the address of the holder
entitled thereto as such address shall appear on the register. The paying agent
shall initially be the property trustee and any co-paying agent chosen by the
property trustee and acceptable to the administrative trustees and Cox. The
paying agent shall be permitted to resign as paying agent upon 30 days prior
written notice to the property trustee, the administrative trustees and Cox. In
the event that the property trustee shall no longer be the paying agent, the
administrative trustees shall appoint a successor, which shall be a bank or
trust company acceptable to the administrative trustees and Cox, to act as
paying agent.
REGISTRAR AND TRANSFER AGENT
The property trustee will act as registrar and transfer agent for the trust
preferred securities.
Registration of transfers of trust preferred securities will be effected
without charge by or on behalf of Cox Trust, but upon payment of any tax or
other governmental charges that may be imposed in connection with any transfer
or exchange. Cox Trust will not be required to register or cause to be
registered the transfer of its trust preferred securities after they have been
converted, exchanged, redeemed or called for redemption.
INFORMATION CONCERNING THE PROPERTY TRUSTEE
The property trustee, other than during the occurrence and continuance of
an event of default under the trust agreement, will undertake to perform only
such duties as are specifically set forth in the trust agreement and, during the
continuance of such event of default, must exercise the same degree of care and
skill as a prudent person would exercise or use in the conduct of his or her own
affairs. Subject to the foregoing, the property trustee will not be under any
obligation to exercise any of the powers vested in it by the trust agreement at
the request of any holder of the related trust securities unless it is offered
reasonable indemnity against the costs, expenses and liabilities that might be
incurred thereby. If no such event of default has occurred and is continuing and
the property trustee is required to decide between alternative causes of action,
construe ambiguous provisions in the trust agreement or is unsure of the
application of any provision of the trust agreement, and the matter is not one
on which holders of trust preferred securities or trust common securities are
entitled under the trust agreement to vote, then the property trustee shall take
such action as is directed by Cox and if not so directed, shall take such action
as it deems advisable and in the best interests of the holders of the related
trust securities and will have no liability except for its own bad faith,
negligence or willful misconduct.
MISCELLANEOUS
The administrative trustees are authorized and directed to conduct the
affairs of and to operate Cox Trust in such a way that:
- Cox Trust will not be deemed to be an investment company required to be
registered under the Investment Company Act;
- Cox Trust will be classified as a grantor trust for United States federal
income tax purposes; and
- the related junior subordinated debentures will be treated as
indebtedness of Cox for United States federal income tax purposes.
Cox and the administrative trustees are authorized to take any action, not
inconsistent with applicable law, the certificate of trust of Cox Trust or the
trust agreement, that the administrative trustees determine in their discretion
to be necessary or desirable for such purposes, as long as such action does not
materially adversely affect the interests of the holders of the related trust
securities.
Holders of trust preferred securities will not have any preemptive or
similar rights.
Cox Trust may not borrow money, issue debt, execute mortgages or pledge any
of its assets.
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DESCRIPTION OF PREFERRED SECURITIES GUARANTEE
The preferred securities guarantee will be executed and delivered by Cox
concurrently with the issuance by Cox Trust of its trust preferred securities
for the benefit of the holders from time to time of such trust preferred
securities and will be held for such holders by The Bank of New York, as
preferred securities guarantee trustee. The preferred securities guarantee has
been qualified as an indenture under the Trust Indenture Act and is subject to,
and governed by, the Trust Indenture Act. This summary of certain terms and
provisions of the preferred securities guarantee does not purport to be complete
and is subject to, and qualified in its entirety by reference to, all of the
provisions of the preferred securities guarantee, including the definitions
therein of certain terms, and those made a part of the preferred securities
guarantee by the Trust Indenture Act.
GENERAL
Cox will irrevocably agree to pay in full on a subordinated basis, to the
extent set forth herein, the guarantee payments to the holders of the related
trust preferred securities, as and when due, regardless of any defense, right of
set-off or counterclaim that Cox Trust may have or assert other than the defense
of payment. The following payments, which are referred to as guarantee payments,
with respect to trust preferred securities, to the extent not paid by or on
behalf of Cox Trust, will be subject to the preferred securities guarantee:
- any accumulated distributions required to be paid on such trust preferred
securities, to the extent that Cox Trust has funds legally available
therefor at such time;
- the applicable redemption price with respect to such trust preferred
securities called for redemption, to the extent that Cox Trust has funds
legally available therefor at such time; or
- upon a voluntary or involuntary dissolution and liquidation of Cox Trust,
other than in connection with the distribution of the related junior
subordinated debentures to holders of such trust preferred securities or
the redemption, conversion or exchange of the trust preferred securities,
the lesser of
- the amounts due upon the dissolution and liquidation of Cox Trust, to
the extent that Cox Trust has funds legally available therefor at the
time, and
- the amount of assets of Cox Trust remaining available for distribution
to holders of its trust preferred securities after satisfaction of
liabilities to creditors of Cox Trust as required by applicable law.
Cox's obligation to make a guarantee payment may be satisfied by direct
payment of the required amounts by Cox to the holders of the trust preferred
securities entitled thereto or by causing Cox Trust to pay such amounts to such
holders.
Cox will, through the preferred securities guarantee, the trust agreement,
the related junior subordinated debentures and the junior subordinated debenture
indenture, taken together, fully, irrevocably and unconditionally guarantee all
of Cox Trust's obligations under its trust preferred securities. No single
document standing alone or operating in conjunction with fewer than all of the
other documents constitutes such guarantee. It is only the combined operation of
these documents that has the effect of providing a full, irrevocable and
unconditional guarantee of Cox Trust's obligations under its trust preferred
securities.
RANKING
The preferred securities guarantee will constitute an unsecured obligation
of Cox and will rank
- subordinate and junior in right of payment to all other liabilities of
Cox, including all senior debt securities, any subordinated debt
securities and the junior subordinated debentures, except those made
ratable or subordinate by their terms, and
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- senior to all capital stock now or hereafter issued by Cox and to any
guarantee now or hereafter entered into by Cox in respect of any of its
capital stock.
The trust agreement provides that each holder of trust preferred securities
by acceptance thereof agrees to the subordination provisions and other terms of
the preferred securities guarantee. The preferred securities guarantee will rank
equally with all other guarantees to be issued by Cox with respect to securities
of other trusts or other entities to be established by Cox that are similar to
Cox Trust.
The preferred securities guarantee will not limit the amount of secured or
unsecured debt, including senior indebtedness as defined in the junior
subordinated debenture indenture, that may be incurred by Cox or any of its
subsidiaries.
PREFERRED SECURITIES GUARANTEE OF PAYMENT
The preferred securities guarantee will constitute a guarantee of payment
and not of collection. In other words, the guaranteed party may institute a
legal proceeding directly against Cox to enforce its rights under such preferred
securities guarantee without first instituting a legal proceeding against any
other person or entity. The preferred securities guarantee will not be
discharged except by payment of the related preferred securities guarantee
payments in full to the extent not paid by Cox Trust or upon distribution of its
trust preferred securities to the holders of the related junior subordinated
debentures.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes that do not materially adversely affect
the rights of holders of the related trust preferred securities, in which case
no approval will be required, the preferred securities guarantee may not be
amended without the prior approval of the holders of a majority of the
liquidation amount of such outstanding trust preferred securities. The manner of
obtaining any such approval will be as set forth under "Description of Trust
Preferred Securities -- Voting Rights; Amendment of the Trust Agreement." All
guarantees and agreements contained in the preferred securities guarantee shall
bind the successors, assigns, receivers, trustees and representatives of Cox and
shall inure to the benefit of the holders of the related trust preferred
securities then outstanding.
EVENTS OF DEFAULT
An event of default under the preferred securities guarantee will occur
upon the failure of Cox to perform any of its payment or other obligations
thereunder, provided that, except with respect to a default in respect of any
preferred securities guarantee payment, Cox shall have received notice of such
default and shall not have cured such default within 60 days of such receipt.
The holders of a majority in liquidation amount of the related trust preferred
securities will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the preferred securities
guarantee trustee in respect of the preferred securities guarantee or to direct
the exercise of any trust or power conferred upon the preferred securities
guarantee trustee under the preferred securities guarantee.
If the preferred securities guarantee trustee fails to enforce the
preferred securities guarantee, any holder of the related trust preferred
securities may institute a legal proceeding directly against Cox to enforce its
rights under the preferred securities guarantee without first instituting a
legal proceeding against Cox Trust, the preferred securities guarantee trustee
or any other person or entity.
TERMINATION
The preferred securities guarantee will terminate and be of no further
force and effect upon:
- full payment of the applicable redemption price of the related trust
preferred securities;
- full payment of all amounts due upon the dissolution and liquidation of
Cox Trust; or
- the conversion or exchange of all of the related trust preferred
securities, whether upon distribution of junior subordinated debentures
to the holders of such trust preferred securities or otherwise.
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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 the related trust
preferred securities must restore payment of any sums paid under such trust
preferred securities or the preferred securities guarantee.
GOVERNING LAW
The preferred securities guarantee will be governed by and construed in
accordance with the laws of the State of New York.
INFORMATION CONCERNING THE PREFERRED SECURITIES GUARANTEE TRUSTEE
The preferred securities guarantee trustee, other than during the
occurrence and continuance of a default by Cox in performance of the preferred
securities guarantee, will undertake to perform only such duties as are
specifically set forth in the preferred securities guarantee and, during the
continuance of such default, must exercise the same degree of care and skill as
a prudent person would exercise or use in the conduct of his or her own affairs.
Subject to the foregoing, the preferred securities guarantee trustee will not be
under any obligation to exercise any of the powers vested in it by the preferred
securities guarantee at the request of any holder of the related trust preferred
securities unless it is offered reasonable indemnity against the costs, expenses
and liabilities that might be incurred thereby.
LIMITED PURPOSE OF COX TRUST
The trust preferred securities will represent preferred beneficial
interests in Cox Trust, and Cox Trust exists for the sole purpose of issuing and
selling its trust securities, using the proceeds from the sale of its trust
securities to acquire the related junior subordinated debentures of Cox and
engaging in only those other activities necessary, advisable or incidental
thereto.
RIGHTS UPON DISSOLUTION
Unless the junior subordinated debentures are distributed to holders of the
related trust securities, upon any voluntary or involuntary dissolution and
liquidation of Cox Trust, after satisfaction of the liabilities of creditors of
Cox Trust as required by applicable law, the holders of such trust securities
will be entitled to receive, out of assets held by Cox Trust, the liquidation
distribution in cash. See "Description of Trust Preferred
Securities -- Liquidation of Cox Trust and Distribution of Junior Subordinated
Debentures." Upon any voluntary or involuntary liquidation or bankruptcy of Cox,
the property trustee, as holder of the junior subordinated debentures, would be
a creditor of Cox, subordinated in right of payment to all senior indebtedness
as set forth in the junior subordinated debenture indenture, but entitled to
receive payment in full of principal and premium, if any, and interest in
respect of such junior subordinated debentures, before any stockholders of Cox
receive payments or distributions.
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RELATIONSHIP AMONG THE TRUST PREFERRED SECURITIES,
THE CORRESPONDING JUNIOR SUBORDINATED DEBENTURES
AND THE PREFERRED SECURITIES GUARANTEE
Full and Unconditional Guarantee. Cox will irrevocably guarantee payments
of distributions and other amounts due on the trust preferred securities to the
extent Cox Trust has funds available for the payment of the distributions as and
to the extent set forth under "Description of Preferred Securities Guarantee."
Taken together, Cox's obligations under the junior subordinated debentures, the
securities resolution, the junior subordinated debenture indenture, the trust
agreement and the preferred securities guarantee agreement provide, in the
aggregate, a full, irrevocable and unconditional guarantee of payments of
distributions and other amounts due on the trust preferred securities. No single
document standing alone or operating in conjunction with fewer than all of the
other documents constitutes the full guarantee. It is only the combined
operation of these documents that has the effect of providing a full,
irrevocable and unconditional guarantee of Cox Trust's obligations under the
trust preferred securities.
If and to the extent that Cox does not make payments on the junior
subordinated debentures, Cox Trust will not pay distributions or other amounts
due on its trust preferred securities. The preferred securities guarantee does
not cover payment of distributions when Cox Trust does not have sufficient funds
to pay the distributions. In that event, the remedy for a holder of trust
preferred securities is to institute a legal proceeding directly against Cox for
enforcement of payment of the distributions to such holder. Cox's obligations
under the preferred securities guarantee are subordinate and junior in right of
payment to all of Cox's senior indebtedness and subordinated indebtedness.
Sufficiency of Payments. As long as all payments are made when due on the
junior subordinated debentures, those payments will be sufficient to cover
distributions and other payments due on the trust preferred securities. This is
primarily because:
- the aggregate principal amount of the junior subordinated debentures will
be equal to the sum of the aggregate stated liquidation amount of the
trust preferred securities and trust common securities;
- the interest rate and interest and other payment dates on the junior
subordinated debentures will match the distribution rate and distribution
and other payment dates for the trust preferred securities;
- Cox, as borrower, has promised to pay any and all costs, expenses and
liabilities of Cox Trust except Cox Trust's obligations under its trust
preferred securities; and
- the trust agreement provides that Cox Trust will not engage in any
activity that is not consistent with the limited purposes of Cox Trust.
Cox has the right to set-off any payment Cox is otherwise required to make
under the junior subordinated debenture indenture if and to the extent Cox has
already made, or is concurrently making, a payment under the preferred
securities guarantee agreement.
Enforcement Rights of Holders of Trust Preferred Securities. A holder of a
trust preferred security may institute a legal proceeding directly against Cox
to enforce its rights under the preferred securities guarantee agreement without
first instituting a legal proceeding against the preferred securities guarantee
trustee, Cox Trust or anyone else.
Cox's default or event of default under any other senior or subordinated
indebtedness would not necessarily constitute a trust event of default. However,
in the event of payment defaults under, or acceleration of, Cox's senior or
subordinated indebtedness, the subordination provisions of the applicable
securities resolution will provide that no payments may be made in respect of
the junior subordinated debentures until the senior or subordinated indebtedness
has been paid in full or any payment default thereunder has been cured or
waived. Cox's failure to make required payments on any junior subordinated
debentures would constitute a trust event of default.
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Limited Purpose of Cox Trust. Cox Trust's trust preferred securities
evidence undivided beneficial ownership interests in the assets of Cox Trust,
and Cox Trust exists for the sole purposes of issuing its trust preferred
securities and trust common securities, investing the proceeds in junior
subordinated debentures and engaging in only those other activities necessary,
convenient or incidental to those purposes. A principal difference between the
rights of a holder of a trust preferred security and a holder of a corresponding
junior subordinated debenture is that a holder of a junior subordinated
debenture is entitled to receive from Cox the principal amount of and interest
accrued on the corresponding junior subordinated debentures, while a holder of
trust preferred securities is entitled to receive distributions from Cox Trust,
or from Cox under the preferred securities guarantee agreement, if and to the
extent Cox Trust has funds available for the payment of the distributions.
Rights Upon Dissolution. Upon any voluntary or involuntary dissolution of
Cox Trust involving the liquidation of the junior subordinated debentures, the
holders of the trust preferred securities will be entitled to receive the
liquidation distribution in cash, out of assets of Cox Trust and after
satisfaction of creditors of Cox Trust as provided by applicable law. See
"Description of Trust Preferred Securities -- Liquidation of Cox Trust and
Distribution of Junior Subordinated Debentures." If Cox becomes subject to any
voluntary or involuntary liquidation or bankruptcy, the property trustee, as
holder of the junior subordinated debentures, would be one of Cox's junior
subordinated creditors. The property trustee would be subordinated in right of
payment to all of Cox's senior indebtedness and subordinated indebtedness, but
it would be entitled to receive payment in full of principal and interest before
Cox's stockholders receive payments or distributions. Cox is the guarantor under
the preferred securities guarantee agreement and pursuant to the junior
subordinated debenture indenture, as borrower, has agreed to pay all costs,
expenses and liabilities of Cox Trust other than Cox Trust's obligations to the
holders of the trust preferred securities. Accordingly, in the event of Cox's
liquidation or bankruptcy the positions of a holder of trust preferred
securities and of a holder of junior subordinated debentures are expected to be
substantially the same relative to Cox's other creditors and to Cox's
stockholders.
36
<PAGE> 40
PLAN OF DISTRIBUTION
Cox and Cox Trust may sell securities to one or more underwriters or
dealers for public offering and sale by them, or it may sell the securities to
investors directly or through agents. The accompanying prospectus supplement
will set forth the terms of the offering and the method of distribution and will
identify any firms acting as underwriters, dealers or agents in connection with
the offering, including:
- the name or names of any underwriters;
- the purchase price of the securities and the proceeds to Cox or Cox Trust
from the sale;
- any underwriting discounts and other items constituting underwriters'
compensation;
- any public offering price;
- any discounts or concessions allowed or reallowed or paid to dealers; and
- any securities exchange or market on which the securities offered in the
prospectus supplement may be listed.
Only those underwriters identified in such prospectus supplement are deemed
to be underwriters in connection with the securities offered in the prospectus
supplement.
Cox and Cox Trust may distribute the securities from time to time in one or
more transactions at a fixed price or prices, which may be changed, or at prices
determined as the prospectus supplement specifies. Cox may sell securities
through forward contracts or similar arrangements. In connection with the sale
of the securities, underwriters, dealers or agents may be deemed to have
received compensation from Cox in the form of underwriting discounts or
commissions and also may receive commissions from securities purchasers for whom
they may act as agent. Underwriters may sell the securities to or through
dealers, and such dealers may receive compensation in the form of discounts,
concessions or commissions from the underwriters or commissions from the
purchasers for whom they may act as agent. Some of the underwriters, dealers or
agents who participate in the securities distribution may engage in other
transactions with, and perform other services for, Cox and its subsidiaries in
the ordinary course of business.
Any underwriting or other compensation which Cox pays to underwriters or
agents in connection with the securities offering, and any discounts,
concessions or commissions which underwriters allow to dealers, will be set
forth in the prospectus supplement. Underwriters, dealers and agents
participating in the securities distribution may be deemed to be underwriters,
and any discounts and commissions they receive and any profit they realize on
the resale of the securities may be deemed to be underwriting discounts and
commissions under the Securities Act. Underwriters and their controlling
persons, dealers and agents may be entitled, under agreements entered into with
Cox and Cox Trust, to indemnification against and contribution toward specific
civil liabilities, including liabilities under the Securities Act.
37
<PAGE> 41
LEGAL MATTERS
Dow, Lohnes & Albertson, PLLC, of Washington, D.C., and Richards, Layton &
Finger, P.A., of Wilmington, Delaware, will pass upon the validity of the
securities offered in the applicable prospectus supplement for Cox and Cox
Trust, respectively. Unless otherwise specified in the applicable prospectus
supplement, Brown & Wood LLP, of New York, New York, will pass upon certain
matters for any underwriters.
EXPERTS
The consolidated financial statements of Cox and Cox Communications PCS,
L.P. and subsidiaries incorporated in this prospectus by reference from Cox's
Annual Report on Form 10-K for the year ended December 31, 1998 have been
audited by Deloitte & Touche LLP, independent auditors, as stated in their
reports, which are incorporated herein by reference into this prospectus, and
have been so incorporated in reliance upon the reports of such firm given upon
their authority as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
Cox is subject to the informational requirements of the Exchange Act and
files reports, proxy statements and other information with the SEC. Cox's SEC
filings are available over the Internet at the SEC's web site at
http://www.sec.gov. You also may read and copy any document Cox files at the
SEC's public reference rooms in Washington, D.C., New York and Chicago or obtain
copies of such materials by mail. Please call the SEC at 1-800-SEC-0330 for more
information on the public reference rooms and their copy charges, as well as the
Public Reference Section's charges for mailing copies of the documents Cox has
filed.
You can also inspect and copy any of Cox's SEC filings at the offices of
the New York Stock Exchange, Inc., located at 20 Broad Street, New York, New
York, 10005.
INFORMATION INCORPORATED BY REFERENCE
Cox files periodic reports with the SEC. SEC rules permit Cox to
incorporate these filings by reference into this prospectus. By incorporating
Cox's SEC filings by reference, the following documents are made a part of this
prospectus:
- Cox's annual report on Form 10-K for the year ended December 31, 1998;
- Cox's quarterly report on Form 10-Q for the quarter ended March 31, 1998;
- Cox's current report on Form 8-K, dated July 7, 1999;
- Cox's current report on Form 8-K, dated May 17, 1999;
- Cox's current report on Form 8-K, dated May 12, 1999;
- Cox's current report on Form 8-K, dated April 22, 1999;
- Cox's current report on Form 8-K, dated January 8, 1999; and
- Cox's definitive proxy statement for the 1999 annual meeting of
stockholders, dated March 29, 1999.
All documents which Cox will file with the SEC, pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act, after the date of the initial filing of
the registration statement and prior to the termination of the securities
offering shall be deemed to be incorporated by reference in, and to be a part
of, this prospectus from the date such documents are filed. Cox's SEC file
number for Exchange Act documents is 1-6590. Cox will provide without charge, to
any person who receives a copy of this prospectus and the accompanying
prospectus supplement, upon such recipient's written or oral request, a copy of
any document this prospectus incorporates by reference, other than exhibits to
such incorporated
38
<PAGE> 42
documents, unless such exhibits are specifically incorporated by reference in
such incorporated document. Requests should be directed to:
Dallas S. Clement,
Vice President and Treasurer
Cox Communications, Inc.
1400 Lake Hearn Drive
Atlanta, Georgia 30319
Telephone: (404) 843-5000
Any statement contained in this prospectus or in a document incorporated by
reference in, 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
- the prospectus,
- the accompanying prospectus supplement, or
- any other subsequently filed document which also is incorporated by
reference in, 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.
Cox has not included or incorporated by reference separate financial
statements of Cox Trust into this prospectus. Cox does not consider such
financial statements to be material to holders of the trust preferred securities
of Cox Trust because:
- all of the voting securities of Cox Trust will be owned, directly or
indirectly, by Cox, a reporting company under the Exchange Act;
- Cox Trust is a special purpose entity, has no operating history, has no
independent operations and is not engaged in, and does not propose to
engage in, any activity other than issuing securities representing
undivided beneficial interests in the assets of Cox Trust and investing
the proceeds thereof in junior subordinated debentures issued by Cox; and
- Cox's obligations described in this prospectus and in any accompanying
prospectus supplement under the trust agreement of Cox Trust, the
preferred securities guarantee issued by Cox with respect to the trust
preferred securities issued by Cox Trust, the junior subordinated
debentures of Cox purchased by Cox Trust and the junior subordinated
debenture indenture pursuant to which such junior subordinated debentures
are issued, taken together, constitute direct obligations of Cox and a
full and unconditional guarantee of the trust of Cox Trust.
39
<PAGE> 43
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following are the expenses of issuance and distribution of the
securities registered hereunder on Form S-3, other than underwriting discounts
and commissions. All amounts except the registration fee are estimated.
<TABLE>
<S> <C>
Registration fee............................................ $444,800
Rating Agency fees.......................................... *
Legal fees and expenses..................................... *
Accounting fees and expenses................................ *
Printing and engraving expenses............................. *
Trustee's fees.............................................. *
New York Stock Exchange listing fee......................... *
Miscellaneous............................................... *
--------
Total............................................. $ *
========
All of the above expenses have been or will be paid by Cox.
</TABLE>
- ---------------
* To be completed by amendment.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Reference is made to Section 102(b)(7) of the Delaware General Corporation
Law (the "DGCL"), which enables a corporation in its original certificate of
incorporation or an amendment thereto to eliminate or limit the personal
liability of a director for violations of the director's fiduciary duty, except
(i) for any breach of the director's duty of loyalty to the corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) pursuant to Section
174 of the DGCL (providing for liability of directors for unlawful payment of
dividends or unlawful stock purchases or redemptions), or (iv) for any
transaction from which a director derived an improper personal benefit. Cox's
Amended Certificate of Incorporation contains a provision which eliminates the
liability of directors to the extent permitted by Section 102(b)(7) of the DGCL.
Reference is made to Section 145 of the DGCL, which provides that a
corporation may indemnify directors and officers as well as other employees and
individuals against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement in connection with specified actions, suits or
proceedings, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the corporation (a "derivative action")),
if they acted in good faith and in a manner they reasonably believed to be in or
not opposed to the best interests of the corporation and, with respect to any
criminal action or proceeding, had no reasonable cause to believe their conduct
was unlawful. A similar standard is applicable in the case of derivative
actions, except that indemnification only extends to expenses (including
attorneys' fees) incurred in connection with the defense or settlement of such
action, and the statute requires court approval before there can be any
indemnification where the person seeking indemnification has been found liable
to the corporation. The statute provides that it is not exclusive of other
indemnification that may be granted by a corporation's charter, by-laws,
disinterested director vote, stockholder vote, agreement or otherwise. The
Amended Certificate of Incorporation of Cox provides that Cox shall indemnify
its directors and officers to the fullest extent permitted by Delaware law.
The declaration of trust, referred to as the trust agreement, provides that
no trustee, affiliate of any trustee or any officers, directors, stockholders,
members, partners, employees, representatives or agents of any trustee or any
employee or agent of Cox Trust or its affiliates, each referred to as an
indemnified person, shall be liable, responsible or accountable in damages or
otherwise to any employee or agent of Cox Trust or its affiliates or any
officers, directors, stockholders, employees, representatives or agents of
II-1
<PAGE> 44
Cox or its affiliates, or to any holders of trust securities of Cox Trust 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 Cox 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 trust agreement of Cox
Trust 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 of Cox Trust, negligence) or
willful misconduct with respect to such acts or omissions. The trust agreement
also provides that, to the fullest extent permitted by applicable law, Cox 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 Cox Trust and in a manner such indemnified person reasonably believed to be
within the scope of authority conferred on such indemnified person by the trust
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 gross negligence (or, in the case of the property trustee of Cox
Trust, negligence) or willful misconduct with respect to such acts or omissions.
The trust agreement 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 the final disposition of
such claim, demand, action, suit or proceeding shall, from time to time, be
advanced by Cox prior to the final disposition of such claim, demand, action,
suit or proceeding upon receipt by Cox 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 pursuant to the trust
agreement.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <C> <S>
*1.1 -- Form of Underwriting Agreement relating to debt securities
of Cox Communications, Inc.
*1.2 -- Form of Underwriting Agreement relating to Trust Preferred
Securities of Cox Trust I and Preferred Securities Guarantee
of Cox Communications, Inc.
4.1 -- Indenture dated as of June 27, 1995 between Cox
Communications, Inc. and The Bank of New York, as trustee,
relating to the debt securities (previously filed as an
exhibit to Cox's Registration Statement on Form S-1 (File
No. 33-99116) and incorporated herein by this reference).
**4.2 -- Form of Indenture for Junior Subordinated Debentures of Cox
Communications, Inc.
4.3 -- Certificate of Trust of Cox Trust I.
**4.4 -- Form of Preferred Securities Guarantee Agreement.
4.5 -- Declaration of Trust of Cox Trust I.
**4.6 -- Form of Amended and Restated Trust Agreement for Cox Trust
I.
**4.7 -- Form of Preferred Security Certificate of Cox Trust I
(incorporated by reference to Exhibit A-1 of Exhibit 4.6).
**5.1 -- Opinion of Dow, Lohnes & Albertson, PLLC.
**5.2 -- Opinion of Richards, Layton & Finger, P.A.
12.1 -- Statement setting forth computation of ratio of earnings to
fixed charges.
23.1 -- Consent of Deloitte & Touche LLP, Atlanta, Georgia.
23.2 -- Consent of Deloitte & Touche LLP, Kansas City, Missouri.
**23.3 -- Consent of Dow, Lohnes & Albertson, PLLC (contained in their
opinion filed as Exhibit 5.1).
**23.4 -- Consent of Richards, Layton & Finger, P.A. (contained in
their opinion filed as Exhibit 5.2).
24.1 -- Powers of Attorney (included on the signature page).
</TABLE>
II-2
<PAGE> 45
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <C> <S>
24.2 -- Powers of Attorney for Cox, as Sponsor, to sign the
Registration Statement on behalf of Cox Trust I (included in
Exhibit 4.5).
*25.1 -- Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of The Bank of New York, as trustee under the
indenture.
*25.2 -- Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of The Bank of New York (Delaware), as trustee
under the Junior Subordinated Debenture Indenture.
*25.3 -- Form T-1 Statement of Eligibility for The Bank of New York,
as property trustee and The Bank of New York (Delaware), as
Delaware trustee under the Amended and Restated Trust
Agreement for Cox Trust I.
*25.4 -- Form T-1 Statement of Eligibility for The Bank of New York,
as guarantee trustee under the Preferred Securities
Guarantee Agreement.
</TABLE>
- ---------------
* To be filed by post-effective amendment or by a Current Report on Form 8-K.
** To be filed by pre-effective amendment.
ITEM 17. UNDERTAKINGS.
Each Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(a) to include any prospectus required by Section 10(a)(3) of the
Securities Act;
(b) to reflect in the prospectus any facts or events arising after
the effective date of this registration statement (or the most recent
post-effective amendment thereof) which individually or in the
aggregate, represent a fundamental change in the information set forth
in this registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement; and
(c) to include any material information with respect to the plan of
distribution not previously disclosed in this registration statement or
any material change to such information in this registration statement;
provided, however, that the undertakings set forth in paragraphs (a) and
(b) above do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by a Registrant pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934, as amended, that are incorporated by
reference in this registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
II-3
<PAGE> 46
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of a Registrant's annual report
pursuant to section 13(a) or 15(d) of the Securities Exchange Act of 1934
that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of a Registrant pursuant to the foregoing provisions,
or otherwise, each Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than
the payment by a Registrant of expenses incurred or paid by a director,
officer or controlling person of a 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.
Each Registrant hereby undertakes that:
(1) 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 such Registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act of 1933 shall be deemed to be part
of this registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the 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.
II-4
<PAGE> 47
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Cox
Communications, Inc. certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Atlanta, State of Georgia, on July 8, 1999.
COX COMMUNICATIONS, INC.
By: /s/ JAMES O. ROBBINS
------------------------------------
James O. Robbins
President and Chief Executive
Officer
POWER OF ATTORNEY
Cox Communications, Inc., a Delaware corporation, and each person whose
signature appears below, constitutes and appoints James O. Robbins and Jimmy W.
Hayes, and either of them, with full power to act without the other, such
person's true and lawful attorneys-in-fact, with full power of substitution and
resubstitution, for him or her and in his or her name, place and stead, in any
and all capacities, to sign this Registration Statement, any subsequent related
registration statement filed pursuant to Rule 462(b) or Rule 462(d) promulgated
under the Securities Act of 1933, and any and all amendments to such
registration statements and other documents in connection therewith, and to file
the same, and all exhibits thereto and other documents in connection therewith,
with the Securities and Exchange Commission, granting unto said
attorneys-in-fact, and each of them, full power and authority to do and perform
each and every act and thing necessary or desirable to be done in and about the
premises, as fully to all intents and purposes as he or she might or could do in
person, thereby ratifying and confirming all that said attorneys-in-fact, or any
of them, or their or his or her substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons on
behalf of Cox Communications, Inc. and in the capacities and on the dates
indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ JAMES C. KENNEDY Chairman of the Board of Directors July 8, 1999
- -----------------------------------------------------
James C. Kennedy
/s/ JAMES O. ROBBINS President and Chief Executive July 8, 1999
- ----------------------------------------------------- Officer, Director
James O. Robbins
/s/ JIMMY W. HAYES Executive Vice President, Finance July 8, 1999
- ----------------------------------------------------- and Administration, and Chief
Jimmy W. Hayes Financial Officer (Principal
Financial Officer)
/s/ JOHN M. DYER Vice President, Mergers and July 8, 1999
- ----------------------------------------------------- Acquisitions and Chief
John M. Dyer Accounting Officer (Principal
Accounting Officer)
</TABLE>
II-5
<PAGE> 48
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ DAVID E. EASTERLY Director July 8, 1999
- -----------------------------------------------------
David E. Easterly
/s/ ROBERT F. ERBURU Director July 8, 1999
- -----------------------------------------------------
Robert F. Erburu
/s/ ROBERT C. O'LEARY Director July 8, 1999
- -----------------------------------------------------
Robert C. O'Leary
</TABLE>
II-6
<PAGE> 49
SIGNATURE
Pursuant to the requirements of the Securities Act of 1933, Cox Trust I
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 Atlanta, State of Georgia, on July 8, 1999.
COX TRUST I
By: Cox Communications, Inc.,
as Sponsor
By: /s/ JIMMY W. HAYES
------------------------------------
Name: Jimmy W. Hayes
Title: Executive Vice President,
Finance and
Administration, and Chief
Financial Officer
II-7
<PAGE> 1
Exhibit 4.3
CERTIFICATE OF TRUST
OF
COX TRUST I
THIS CERTIFICATE OF TRUST of Cox Trust I (the "Trust"), dated as of
July 7, 1999, is being duly executed and filed by the undersigned, as trustees,
to form a business trust under the Delaware Business Trust Act (12 Del. C. ss.
3801, et seq.) (the "Act").
(i) Name. The name of the business trust being formed hereby is Cox
Trust I.
(ii) Delaware Trustee. The name and business address of the trustee of
the Trust in the State of Delaware are The Bank of New York (Delaware), White
Clay Center, Route 273, Newark, Delaware 19711, Attention: Corporate Trust
Administration.
(iii) Effective Date. This Certificate of Trust shall be effective as
of its filing with the Secretary of State of the State of Delaware.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have duly executed this Certificate of Trust in accordance with Section
3811(a)(1) of the Act as of the date first above written.
THE BANK OF NEW YORK, as trustee
By: /s/ MARIE E. TRIMBOLI
-----------------------------------------
Name: Marie E. Trimboli
Title: Assistant Treasurer
THE BANK OF NEW YORK (DELAWARE), as trustee
By: /s/ WALTER N. GITLIN
-----------------------------------------
Name: Walter N. Gitlin
Title: Authorized Signatory
<PAGE> 1
Exhibit 4.5
DECLARATION OF TRUST
OF
COX TRUST I
THIS DECLARATION OF TRUST is made as of July 7, 1999 (this
"Declaration of Trust"), by and among Cox Communications, Inc., a Delaware
corporation, as sponsor (the "Sponsor"), The Bank of New York, as trustee (the
"Property Trustee"), and The Bank of New York (Delaware), as trustee (the
"Delaware Trustee") (the Property Trustee and the Delaware Trustee being
hereinafter jointly referred to as the "Trustees"). The Sponsor and the Trustees
hereby agree as follows:
1. The trust created hereby shall be known as Cox Trust I (the
"Trust"), in which name the Trustees or the Sponsor, to the extent provided
herein, may conduct the business of the Trust, make and execute contracts, and
sue and be sued.
2. The Sponsor hereby assigns, transfers, conveys and sets over to the
Trust the sum of $10. It is the intention of the parties hereto that the Trust
created hereby constitute a business trust under Chapter 38 of Title 12 of the
Delaware Code, 12 Del. C. ss. 3801, et seq. (the "Business Trust Act"), and that
this document constitute the governing instrument of the Trust. The Trustees are
hereby authorized and directed to execute and file a certificate of trust with
the Delaware Secretary of State in accordance with the provisions of the
Business Trust Act.
3. An amended and restated Declaration of Trust satisfactory to each
party to it, in such form as the parties thereto may approve, will be entered
into to provide for the contemplated operation of the Trust created hereby and
the issuance of the Preferred or Capital Securities and Common Securities
referred to therein. Prior to the execution and delivery of such amended and
restated Declaration of Trust, the Trustees shall not have any duty or
obligation hereunder or with respect to the trust estate, except as otherwise
required by applicable law or as may be necessary to obtain prior to such
execution and delivery any licenses, consents or approvals required by
applicable law or otherwise. Notwithstanding the foregoing, the Trustees may
take all actions deemed proper as are necessary to effect the transactions
contemplated herein.
4. The Sponsor, as sponsor of the Trust, is hereby authorized, in its
discretion, (i) to prepare and file with the Securities and Exchange Commission
(the "Commission") and to execute, in the case of the 1933 Act Registration
Statement and 1934 Act Registration Statement (as herein defined), on behalf of
the Trust, (a) a Registration Statement (the "1933 Act Registration Statement"),
including all pre-effective and post-effective amendments thereto, relating to
the registration under the Securities Act of 1933, as amended (the "1933 Act"),
of the Preferred or Capital Securities of the Trust, (b) any preliminary
prospectus or prospectus or supplement thereto relating to the Preferred or
Capital Securities of the Trust required to be filed pursuant to the 1933 Act,
and (c) a Registration Statement on Form 8-A or other appropriate form (the
"1934 Act Registration Statement"), including all pre-effective and
post-effective amendments thereto, relating to the registration of the Preferred
or Capital Securities of the Trust under the Securities Exchange Act of 1934, as
amended; (ii) if and at such time as determined by the Sponsor, to file with the
New York Stock Exchange or other exchange, or the National
<PAGE> 2
Association of Securities Dealers ("NASD"), and execute on behalf of the Trust a
listing application and all other applications, statements, certificates,
agreements and other instruments as shall be necessary or desirable to cause the
Preferred or Capital Securities of the Trust to be listed on the New York Stock
Exchange or such other exchange, or the NASD's Nasdaq National Market; (iii) to
file and execute on behalf of the Trust, such applications, reports, surety
bonds, irrevocable consents, appointments of attorney for service of process and
other papers and documents that shall be necessary or desirable to register the
Preferred or Capital Securities of the Trust under the securities or "Blue Sky"
laws of such jurisdictions as the Sponsor, on behalf of the Trust, may deem
necessary or desirable; (iv) to execute and deliver letters or documents to, or
instruments for filing with, a depository relating to the Preferred or Capital
Securities of the Trust; and (v) to execute, deliver and perform on behalf of
the Trust an underwriting agreement with one or more underwriters relating to
the offering of the Preferred or Capital Securities of the Trust.
In the event that any filing referred to in this Section 4 is required
by the rules and regulations of the Commission, the New York Stock Exchange or
other exchange, NASD, or state securities or "Blue Sky" laws to be executed on
behalf of the Trust by the Trustees, the Trustees, in their capacity as trustees
of the Trust, are hereby authorized to join in any such filing and to execute on
behalf of the Trust any and all of the foregoing, it being understood that the
Trustees, in their capacity as trustees of the Trust, shall not be required to
join in any such filing or execute on behalf of the Trust any such document
unless required by the rules and regulations of the Commission, the New York
Stock Exchange or other exchange, NASD, or state securities or "Blue Sky" laws.
5. This Declaration of Trust may be executed in one or more
counterparts.
6. The number of trustees of the Trust initially shall be two and
thereafter the number of trustees of the Trust shall be such number as shall be
fixed from time to time by a written instrument signed by the Sponsor which may
increase or decrease the number of trustees of the Trust; provided, however,
that to the extent required by the Business Trust Act, one trustee of the Trust
shall either be a natural person who is a resident of the State of Delaware or,
if not a natural person, an entity which has its principal place of business in
the State of Delaware. Subject to the foregoing, the Sponsor is entitled to
appoint or remove without cause any trustee of the Trust at any time. Any
trustee of the Trust may resign upon thirty days' prior notice to the Sponsor.
7. This Declaration of Trust shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws principles).
8. The Sponsor hereby agrees to indemnify the Trustees and any of the
officers, directors, employees and agents of the Trustees (the "Indemnified
Persons") for, and to hold each Indemnified Person harmless against, any
liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of the
trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against or investigating
any claim or liability in connection with the exercise or performance of any of
its powers or duties hereunder.
2
<PAGE> 3
IN WITNESS WHEREOF, the parties hereto have caused this Declaration of
Trust to be duly executed as of the day and year first above written.
COX COMMUNICATIONS, INC.,
as Sponsor
By: /s/ JIMMY W. HAYES
-----------------------------------------
Name: Jimmy W. Hayes
Title: Exec. V.P., Finance & Administration,
Chief Financial Officer
THE BANK OF NEW YORK,
as Property Trustee
By: /s/ MARIE E. TRIMBOLI
-----------------------------------------
Name: Marie E. Trimboli
Title: Assistant Treasurer
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
By: /s/ WALTER N. GITLIN
-----------------------------------------
Name: Walter N. Gitlin
Title: Authorized Signatory
3
<PAGE> 1
EXHIBIT 12.1
COX COMMUNICATIONS, INC.
STATEMENT SETTING FORTH COMPUTATION OF
RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
Year ended December 31
1998 1997 1996 1995 1994
----------------------------------------------------------------------
(Dollars in Millions)
<S> <C> <C> <C> <C> <C>
Earnings available for Fixed Charges:
- -------------------------------------
Income (loss) before income taxes and minority interest $ 1,207.7 $ (136.5) $ (51.6) $ 103.8 $ 26.6
Income tax expense (benefit) 822.8 (53.5) 23.0 99.9 25.7
Equity in net losses of affiliated companies 547.2 404.4 170.4 79.7 43.9
Fixed Charges (see below), excluding capitalized interest 233.2 213.9 157.9 143.3 55.7
--------------------------------------------------------------------
Total $ 2,873.9 $ 428.3 $ 299.7 $ 426.7 $ 151.9
====================================================================
Fixed Charges:
- -------------------------------------
Interest expense $ 223.3 $ 202.1 $ 146.1 $ 132.3 $ 46.1
Capitalized interest 0.0 0.1 43.2 14.2 0.1
Interest component of rentals charged to income 9.9 8.5 5.1 4.3 2.9
Dividends on subsidiary preferred stock 0.0 3.4 6.7 6.7 6.7
---------------------------------------------------------------------
Total fixed charges including capitalized interest $ 233.2 $ 214.0 $ 201.1 $ 157.5 $ 55.8
=====================================================================
Ratio of earnings to fixed charges 12.3 x 2.0 x 1.5 x 2.7 x 2.7 x
<CAPTION>
Three Months Ended March 31
1999 1998
--------------------------------
(Dollars in Millions)
<S> <C> <C>
Earnings available for Fixed Charges:
- -------------------------------------
Income (loss) before income taxes and minority interest $ 251.2 $ (101.9)
Income tax expense (benefit) 144.0 (48.2)
Equity in net losses of affiliated companies 46.5 141.8
Fixed Charges (see below), excluding capitalized interest 56.8 55.4
-------------------------------
Total $ 498.5 $ 47.1
===============================
Fixed Charges:
- -------------------------------------
Interest expense $ 54.0 $ 53.1
Capitalized interest 0.0 0.0
Interest component of rentals charged to income 2.8 2.3
Dividends on subsidiary preferred stock 0.0 0.0
--------------------------------
Total fixed charges including capitalized interest $ 56.8 $ 55.4
================================
Ratio of earnings to fixed charges 8.8 x 0.9 x
</TABLE>
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by the reference in this Registration Statement
of Cox Communications, Inc. on Form S-3 of our report dated February 10, 1999
(March 18, 1999 as to Note 18), appearing in the Annual Report on Form 10-K of
Cox Communications, Inc. for the year ended December 31, 1998 and to the
reference to us under the heading "Experts" in the Prospectus, which is part of
this Registration Statement.
Deloitte & Touche LLP
Atlanta, Georgia
July 9, 1999
<PAGE> 1
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of Cox Communications, Inc. on Form S-3 of our report dated February
2, 1999 on the consolidated financial statements of Cox Communications PCS, L.P.
and subsidiaries for each of the three years in the period ended December 31,
1998, appearing in the Annual Report on Form 10-K of Cox Communications, Inc.
for the year ended December 31, 1998 and to the reference to us under the
heading "Experts" in the Prospectus, which is part of this Registration
Statement.
Deloitte & Touche LLP
Kansas City, Missouri
July 9, 1999
