As filed with the Securities and Exchange Commission on December 18, 1996
Registration No. 333-_____
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Illinois Central Railroad Company
(Exact name of Registrant as specified in its charter)
Delaware 4011 36-2728842
(State of other (Primary Standard (I.R.S. Employer
jurisdiction of Industrial Identification Number)
incorporation or Classification Code
organization) Number)
455 North Cityfront Plaza Drive
Chicago, Illinois 60611-5504
(312) 755-7500
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
Ronald A. Lane
Vice President and General Counsel and Secretary
Illinois Central Railroad Company
455 North Cityfront Plaza Drive
Chicago, Illinois 60611-5504
(312) 755-7500
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copy to:
Winthrop B. Conrad, Jr.
Davis Polk & Wardwell
450 Lexington Avenue
New York, NY 10017
(212) 450-4000
Approximate date of commencement of proposed sale to public: As
soon as practicable after the effective date of this Registration Statement.
If the securities being registered on this Form are being
offered in connection with the formation of a holding company and there is
compliance with General Instruction G, check the following box. [ ]
CALCULATION OF REGISTRATION FEE
- ------------------------------------------------------------------------------
Proposed
Maximum Proposed
Title of Each Offering Maximum Amount
Class of Price Aggregate of
of Securities Amount to be Per Offering Registration
to be Registered Registered Unit Price Fee
- ------------------------------------------------------------------------------
7.70% Debentures
due 2096.......... $125,000,000 100% $125,000,000 $37,878.79
- ------------------------------------------------------------------------------
The Registrant hereby amends this Registration Statement on such
date or dates as may be necessary to delay its effective date until the
Registrant shall file a further amendment which specifically states that
this Registration Statement shall thereafter become effective in accordance
with Section 8(a) of the Securities Act of 1933 or until this Registration
Statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
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INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF
ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED DECEMBER , 1996
Prospectus
ILLINOIS CENTRAL RAILROAD COMPANY
OFFER TO EXCHANGE $1,000 IN PRINCIPAL AMOUNT OF 7.70% DEBENTURES DUE 2096 FOR
EACH $1,000 IN PRINCIPAL AMOUNT OF OUTSTANDING 7.70% DEBENTURES DUE 2096
THAT WERE ISSUED AND SOLD IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED
_____________________
The Exchange Offer will expire at 5:00 P.M.,
New York City time, on , 1997, unless extended
Illinois Central Railroad Company, a Delaware corporation (the
"Company"), hereby offers to exchange (the "Exchange Offer") $125,000,000 in
aggregate principal amount of its 7.70% Debentures due 2096 (the "Exchange
Debentures") for $125,000,000 in aggregate principal amount of its outstanding
7.70% Debentures due 2096 that were issued and sold in a transaction exempt
from registration under the Securities Act of 1933, as amended (the "Original
Debentures" and, together with the Exchange Debentures, the "Debentures").
The terms of the Exchange Debentures are substantially similar
(including principal amount, interest rate, redemption provisions, maturity
and ranking) to the terms of the Original Debentures for which they may be
exchanged pursuant to the Exchange Offer, except that the Exchange Debentures
(i) are freely transferable by holders thereof (except as provided below) and
(ii) are issued without any covenant regarding their registration. The
Exchange Debentures will be issued under the indenture governing the Original
Debentures. The Exchange Debentures will be, and the Original Debentures are,
unsecured obligations of the Company and will rank pari passu with all
existing and future senior unsecured indebtedness of the Company. As of
September 30, 1996, after giving pro forma effect to the offering of the
Original Debentures, the Company would have had approximately $567 million of
outstanding senior unsecured indebtedness. For a complete description of the
terms of the Exchange Debentures, see "Description of Debentures." There will
be no cash proceeds to the Company from the Exchange Offer.
Interest on the Exchange Debentures will accrue (i) from the
last interest payment date on which interest was paid on the Original
Debentures surrendered in exchange therefor or (ii) if no interest has been
paid on the Original Debentures, from the original issue date of the Original
Debentures.
The Original Debentures were originally issued and sold on
December 17, 1996 in a transaction not registered under the Securities Act of
1933, as amended (the "Securities Act"), in reliance upon the exemption
provided in Section 4(2) of the Securities Act and Rule 144A of the Securities
Act (the "Initial Offering"). Accordingly, the Original Debentures may not be
reoffered, resold or otherwise pledged, hypothecated or transferred in the
United States unless so registered or unless an applicable exemption from the
registration requirements of the Securities Act is available. Based upon its
view of interpretations provided to third parties by the Staff (the "Staff")
of the Securities and Exchange Commission (the "Commission"), the Company
believes that the Exchange Debentures issued pursuant to the Exchange Offer in
exchange for the Original Debentures may be offered for resale, resold and
otherwise transferred by holders thereof (other than any holder of any such
other person which is (i) an "affiliate" of the Company within the meaning of
Rule 405 under the Securities Act (an "Affiliate"), (ii) a broker-dealer who
acquired Original Debentures directly from the Company or (iii) a
broker-dealer who acquired Original Debentures as a result of market making or
other trading activities) without compliance with the registration and
prospectus delivery provisions of the Securities Act, provided that such
Exchange Debentures are acquired in the ordinary course of business of such
holder and any beneficial owner, and such holders are not engaged in, and do
not intend to engage in, and have no arrangement or understanding with any
person to participate in, a distribution of such Exchange Debentures. Each
broker-dealer who acquired Original Debentures directly from the Company and
is participating in the Exchange Offer must comply with the registration and
prospectus delivery provisions of the Securities Act. Broker-dealers who
acquired Original Debentures as a result of market making or other trading
activities may use this Prospectus, as supplemented or amended, in connection
with resales of the Exchange Debentures. The Company has agreed that, for a
period of 120 days after this Registration Statement is declared effective by
the Commission, it will make this Prospectus available to any broker-dealer
for use in connection with any such resale. Each broker-dealer who receives
Exchange Debentures pursuant to the Exchange Offer must acknowledge that it
will deliver a prospectus in connection with any resale of such Exchange
Debentures. The Letter of Transmittal that is filed as an exhibit to the
Registration Statement of which this Prospectus is a part (the "Letter of
Transmittal") states that by so acknowledging and by delivering a prospectus,
a broker-dealer will not be deemed to admit that it is an "underwriter" within
the meaning of the Securities Act. Any holder that cannot rely upon such
interpretations must comply with the registration and prospectus delivery
requirements of the Securities Act in connection with a secondary resale
transaction.
The Original Debentures and the Exchange Debentures constitute
new issues of securities with no established public trading market. Any
Original Debentures not tendered and accepted in the Exchange Offer will
remain outstanding. To the extent that Original Debentures are tendered and
accepted in the Exchange Offer, a holder's ability to sell untendered, and
tendered but unaccepted, Original Debentures could be adversely affected.
Following consummation of the Exchange Offer, the holders of Original
Debentures will continue to be subject to the existing restrictions on
transfer thereof and the Company will have no further obligation to such
holders to provide for the registration under the Securities Act of the
Original Debentures except under certain limited circumstances. (See
"Original Debentures Registration Rights.") No assurance can be given as to
the liquidity of the trading market for either the Original Debentures of the
Exchange Debentures.
The Exchange Offer is not conditioned upon any minimum
aggregate principal amount of Original Debentures being tendered or accepted
for exchange. The Exchange Offer will expire at 5:00 p.m., New York City
time, on , 1997, unless extended (the "Expiration Date"). The
date of acceptance for exchange of the Original Debentures (the "Exchange
Date") will be the first business day following the Expiration Date, upon
surrender of the Original Debentures. Original Debentures tendered pursuant
to the Exchange Offer may be withdrawn at any time prior to the Expiration
Date; otherwise such tenders are irrevocable.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
The date of this Prospectus is , 1997.
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED
TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE EXCHANGE OFFER COVERED BY THIS PROSPECTUS.
IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON
AS HAVING BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE
AN OFFER TO SELL, OR A SOLICITATION OF AN OFFER TO BUY, THE EXCHANGE
DEBENTURES IN ANY JURISDICTION WHERE, OR TO ANY PERSON TO WHOM, IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS
NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY
IMPLICATIONS THAT THERE HAS NOT BEEN ANY CHANGE IN THE FACTS SET FORTH IN THIS
PROSPECTUS OR IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
TABLE OF CONTENTS
Page Page
---- ----
Available Information........... 3 Federal Income Tax Consequences... 15
Incorporation of Certain Consequences of Failure to
Documents by Reference.......... 4 Exchange......................... 15
Prospectus Summary.............. 5 Capitalization..................... 16
The Company..................... 9 Selected Historical
Use of Proceeds................. 9 Financial Information............. 17
The Exchange Offer.............. 9 Description of Debentures.......... 19
Purpose of the Exchange Offer.. 9 General........................... 19
Terms and Conditions of Redemption........................ 19
the Letter of Transmittal..... 13 Conditional Right to Shorten
Withdrawal Rights.............. 13 Maturity........................ 20
Acceptance of Original Limitation on Liens............... 22
Debentures for Exchange; Modification of the Indenture..... 23
Delivery of Exchange Defeasance and Covenant Defeasance 23
Debentures.................... 14 Delivery and Form; Book-Entry
Conditions to the Procedures....................... 24
Exchange Offer................ 14 Governing Law..................... 25
Exchange Agent................. 15 Original Debentures Registration
Solicitation of Tenders........ 15 Rights............................ 25
Appraisal Rights............... 15 Plan of Distribution............... 26
Legal Matters...................... 27
Experts............................ 27
_____________________
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange
Commission (the "Commission") a Registration Statement on Form S-4 (which term
shall include all amendments, exhibits and schedules thereto) under the
Securities Act of 1933, as amended (the "Securities Act"), with respect to the
Exchange Debentures being offered hereby. This Prospectus does not contain
all the information set forth in the Registration Statement, certain parts of
which are omitted in accordance with the rules and regulations of the
Commission, and to which reference is hereby made. Statements made in this
Prospectus as to the contents of any document referred to are not necessarily
complete. With respect to each such document filed as an exhibit to the
Registration Statement, reference is made to the exhibit for a more complete
description of the matter involved, and each such statement shall be deemed
qualified in its entirety by such reference. The Registration Statement may
be inspected, without charge, at the public reference facilities maintained by
the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549. Copies of such material can be obtained from the
Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington. D.C. 20549 at prescribed rates.
The Company is subject to the information requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith is required to file reports and other information with
the Commission. Such reports and other information filed by the Company can
be inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549 or at
the Commission's regional offices located at 7 World Trade Center, Suite 1300,
New York, New York 10048; and Citicorp Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661. Copies of such material may be obtained at
prescribed rates from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Room 1024, Washington, D.C. 20549. Such reports and other
information can also be inspected at the offices of the New York Stock
Exchange, Inc., where certain of the Company's debt securities are listed, 20
Broad Street, New York, New York 10005. In addition, the Commission maintains
a Web site that contains reports, proxy and information statements and other
information regarding registrants that file electronically with the
Commission. The Company files electronically with the Commission. The
address of that Web site is http://www.sec.gov.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the year ended
December 31, 1995, Quarterly Reports on Form 10-Q for the quarters ended March
31, 1996, June 30, 1996 and September 30, 1996 and Current Reports on Form 8-K
dated May 15, 1996 (as amended by Amendment No. 1 thereto), July 29, 1996 and
December 4, 1996 are incorporated by reference and made a part of this
Prospectus.
All documents filed by the Company with the Commission pursuant
to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of
this Prospectus and prior to the termination of this offering shall be deemed
to be incorporated by reference into this Prospectus and to be a part hereof
from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein or
contained in this Prospectus shall be deemed to be supplemented, modified or
superseded for purposes of this Prospectus to the extent that a statement
contained herein or in any other subsequently filed document which also is, or
is deemed to be, incorporated by reference herein supplements, modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of
this Prospectus.
The Company hereby undertakes to provide without charge to each
person to whom this Prospectus has been delivered, upon written or oral
request of any such person, a copy (without exhibits) of any and all of the
documents which have been or may be incorporated in this Prospectus by
reference to such documents. Requests for such copies should be directed to
Illinois Central Railroad Company, 455 North Cityfront Plaza Drive,
Chicago, Illinois 60611-5504, Attention: Corporate Relations, telephone
number (312) 755-7500.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE
NOT PRESENTED HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS ARE AVAILABLE
WITHOUT CHARGE UPON WRITTEN OR ORAL REQUEST FROM THE CORPORATE RELATIONS
DEPARTMENT AT THE COMPANY'S PRINCIPAL EXECUTIVE OFFICES LOCATED AT 455 NORTH
CITYFRONT PLAZA DRIVE, CHICAGO, ILLINOIS, 60611-5504, TELEPHONE NUMBER (312)
755-7500. IN ORDER TO ENSURE TIMELY DELIVERY OF SUCH DOCUMENTS, ANY REQUEST
SHOULD BE MADE BY , 1996.
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by reference
to the more detailed information included elsewhere or incorporated by
reference into this Prospectus. Unless the context otherwise required, the
term "Company" refers to Illinois Central Railroad Company and its
subsidiaries.
The Exchange Offer
The Exchange Offer... The Company is offering to exchange (the "Exchange
Offer") $125,000,000 aggregate principal amount of
7.70% Debentures due 2096 (the "Exchange
Debentures") for $125,000,000 aggregate principal
amount of its outstanding 7.70% Debentures due 2096
(the "Original Debentures"). The Original
Debentures were issued and sold by the Company on
December 17, 1996 in a transaction exempt from
registration under Section 4(2) of, and Rule 144A
under, the Securities Act. See "The Exchange
Offer--Purpose of the Exchange Offer." The form and
terms of the Exchange Debentures are substantially
similar (including principal amount, interest rate,
redemption provisions, maturity and ranking) to the
form and terms of the Debentures for which they may
be exchanged pursuant to the Exchange Offer, except
that the Exchange Debentures are freely
transferable by holders thereof except as provided
herein (see "The Exchange Offer--Terms of the
Exchange" and "--Terms and Conditions of the Letter
of Transmittal") and are not subject to any
covenant regarding registration under the
Securities Act.
Exchange Debentures issued pursuant to the Exchange
Offer in exchange for the Original Debentures may
be offered for resale, resold or otherwise
transferred by holders thereof (other than any
holder which is (i) an Affiliate of the Company,
(ii) a broker-dealer who acquired Original
Debentures directly from the Company or (iii) a
broker-dealer who acquired Original Debentures as a
result of market making or other trading
activities), without compliance with the
registration and prospectus delivery provisions of
the Securities Act provided that such Exchange
Debentures are acquired in the ordinary course of
such holders' business and such holders are not
engaged in, and do not intend to engage in, and
have no arrangement or understanding with any
person to participate in, a distribution of such
Exchange Debentures. Each broker-dealer who
acquired Original Debentures directly from the
Company and is participating in the Exchange Offer
must comply with the registration and prospectus
delivery provisions of the Securities Act. Each
broker-dealer who receives Exchange Debentures
pursuant to the Exchange Offer must acknowledge
that it will deliver a prospectus in connection
with any resale of such Exchange Debentures. The
Letter of Transmittal states that by so
acknowledging, and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it
is an "underwriter" within the meaning of the
Securities Act.
Minimum Condition.... The Exchange Offer is not conditioned upon any
minimum aggregate principal amount of Original
Debentures being tendered or accepted for exchange.
Expiration Date...... The Exchange Offer will expire at 5:00 p.m., New York
City time, on , 1997 unless extended (the
"Expiration Date").
Exchange Date........ Letters of Transmittal must be received no later than
the Expiration Date to reflect an exchange of
Original Debentures for Exchange Debentures on the
Exchange Date. The first date of acceptance for
exchange for the Original Debentures will be the
first business day following the Expiration Date.
Conditions to the
Exchange Offer...... The obligation of the Company to consummate the
Exchange Offer is subject to certain conditions.
See "The Exchange Offer--Conditions to the Exchange
Offer." The Company reserves the right to terminate
or amend the Exchange Offer at any time prior to
the Expiration Date upon the occurrence of any such
condition.
Withdrawal Rights.... Tenders may be withdrawn at any time prior to the
Expiration Date. Any Original Debentures not
accepted for any reason will be returned without
expense to the tendering holders thereof as
promptly as practicable after the expiration or
termination of the Exchange Offer.
Procedures for
Tendering Original
Debentures......... See "The Exchange Offer--How to Tender."
Federal Income Tax
Consequences....... There will be no Federal income tax consequences to
Holders exchanging Original Debentures for Exchange
Debentures pursuant to the Exchange Offer. An
exchanging Holder will have the same adjusted basis
and holding period in the Exchange Debentures as it
had in the Original Debentures immediately before
the exchange and in general will be subject to the
same Federal income tax treatment as if it had
continued to hold the Original Debentures.
Effect on Holders of
Original Debentures.. As a result of the making of this Exchange Offer, and
upon acceptance for exchange of all validly
tendered Original Debentures pursuant to the terms
of this Exchange Offer, the Company will have
fulfilled a covenant contained in the terms of the
Original Debentures and the Registration Rights
Agreement (the "Registration Rights Agreement")
dated as of December 17, 1996 among the Company,
Lehman Brothers Inc. and Merrill Lynch, Pierce,
Fenner & Smith Incorporated as initial purchasers
(collectively, the "Initial Purchasers"), and,
accordingly, the holders of the Original Debentures
will have no further registration or other rights
under the Registration Rights Agreement, except
under certain limited circumstances. See "Original
Debentures Registration Rights." Holders of the
Original Debentures who do not tender their
Original Debentures in the Exchange Offer will
continue to hold such Original Debentures and will
be entitled to all the rights and limitations
applicable thereto under the Indenture. All
untendered, and tendered but unaccepted, Original
Debentures will continue to be subject to the
restrictions on transfer provided for in the
Original Debentures and the Indenture. To the
extent that Original Debentures are tendered and
accepted in the Exchange Offer, the trading market,
if any, for the Original Debentures could be
adversely affected.
Consequences of
Failure to Exchange.. Holders of Original Debentures who do not exchange
their Original Debentures for Exchange Debentures
pursuant to the Exchange Offer will continue to be
subject to the restrictions on transfer of such
Original Debentures as set forth in the legend
thereon as a consequence of the issuance of the
Original Debentures pursuant to exemptions from, or
in transactions not subject to, the registration
requirements of the Securities Act and applicable
state securities laws. In general, the Original
Debentures may not be offered or sold, unless
registered under the Securities Act and applicable
state securities laws, or pursuant to an exemption
therefrom. Except under certain limited
circumstances, the Company does not intend to
register the Original Debentures under the
Securities Act. In addition, any holder of
Original Debentures who tenders in the Exchange
Offer for the purpose of participating in a
distribution of the Exchange Debentures may be
deemed to have received restricted securities and,
if so, will be required to comply with the
registration and prospectus delivery requirements
of the Securities Act in connection with any resale
transaction. To the extent Original Debentures are
tendered and accepted in the Exchange Offer, the
trading market, if any, for the Original Debentures
could be adversely affected. See "The Exchange
Offer" and "Original Debentures Registration
Rights."
Terms of the Debentures
Securities Offered... $125,000,000 principal amount of 7.70% Debentures due
2096.
Maturity Date........ September 15, 2096.
Interest Payment
Dates.............. Interest on the Debentures will be payable in cash
semi-annually on March 15 and September 15 of each
year, commencing March 15, 1997.
Optional Redemption.. The Debentures are not redeemable prior to September
15, 2026. On and after September 15, 2026, the
Debentures are redeemable at the option of the
Company, in whole or in part, initially at a
redemption price equal to 102.92% of the principal
amount of such Debentures and thereafter up to and
including September 14, 2046 at declining prices
and thereafter at a redemption price equal to 100%
of the principal amount of such Debentures, in each
case together with accrued and unpaid interest and
Liquidated Damages, if any, to the date of
redemption. See "Description of Debentures--
Optional Redemption."
Conditional Right
to Shorten Maturity.. Upon occurrence of a "Tax Event" relating to the
deductibility of interest paid by the Company on
the Debentures, the Company will have the right to
shorten the maturity of the Debentures to the
extent required, in the opinion of a nationally
recognized independent tax counsel, so that, after
the shortening of the maturity, interest paid on
the Debentures will be deductible for Federal
income tax purposes.
Ranking.............. The Debentures will be general unsecured obligations
of the Company, and will rank pari passu in right
of payment to all existing and future senior
unsecured indebtedness of the Company. As of
September 30, 1996, after giving pro forma effect
to the issuance of the Debentures, the Company
would have had approximately $567 million of senior
unsecured indebtedness outstanding. See
"Capitalization" and "Description of Debentures."
THE COMPANY
The Company traces its origin to 1851, when the Railroad was
incorporated as the nation's first land grant railroad. Today, the Railroad
operates 2,700 miles of main line track between Chicago and the Gulf of
Mexico, primarily carrying chemicals, coal and paper north, with coal, grain
and milled grain products moving south along its lines. The Railroad is a
wholly-owned subsidiary and a principal asset of Illinois Central Corporation
("IC"). The principal executive office of the Railroad is located at 455
North Cityfront Plaza Drive, Chicago, Illinois 60611-5504 and its telephone
number is (312) 755-7500.
USE OF PROCEEDS
There will be no proceeds to the Company from the exchange
pursuant to the Exchange Offer. The net proceeds from the issuance of the
Original Debentures were approximately $123 million. The Company intends to
use such net proceeds for general corporate purposes, including but not
limited to paying commercial paper as it matures, funding the cost of any
settlement with one of the Company's unions and expenditures with respect to
the bulk commodities terminal facility being constructed in Louisiana. At
October 31, 1996, the total indebtedness of the Company was $513 million, of
which $64 million was commercial paper with an average maturity of 38.9 days
and an average interest rate per annum of 5.621%. Initially, the Company will
repay $50 million of its commercial paper. The balance of the net proceeds
will be invested in investment grade temporary cash investments pending the
outcome of the vote on three settlement options contained in a proposed
contract settlement with the United Transportation Union (the "UTU"). The
Company estimates that one of the three options contained in the agreement
could require a one-time payment of up to $40 million. If the UTU does not
elect the option requiring the one-time payment, then the net proceeds may be
used to fund a portion of the estimated $45 million construction cost of the
bulk commodities terminal facility in Louisiana to be incurred in 1997.
THE EXCHANGE OFFER
Purpose of the Exchange Offer
The sole purpose of the Exchange Offer is to fulfill the
obligations of the Company with respect to the registration of the Original
Debentures.
The Original Debentures were originally issued and sold on
December 17, 1996 (the "Issue Date"). Such sales were not registered under
the Securities Act in reliance upon the exemption provided by Section 4(2) of
the Securities Act and Rule 144A under the Securities Act. In connection with
the sale of the Original Debentures, the Company agreed to file with the
Commission a registration statement relating to an exchange offer (the
"Exchange Offer Registration Statement") pursuant to which the Exchange
Debentures, another form of debentures of the Company covered by such
registration statement and containing substantially similar terms as the
Original Debentures, except as set forth in this Prospectus, would be offered
in exchange for Original Debentures tendered at the option of the holders
thereof. If (i) the Company determines in reasonably good faith that (x) any
changes in the law of the applicable interpretations of the Staff of the
Commission do not permit the Company to effect the Exchange Offer, or (y) that
the Exchange Debentures would not be tradeable upon receipt by the holders of
Original Debentures that participate in the Exchange Offer without restriction
under state and federal securities laws (other than due solely to the status
of a holder of Original Debentures as an Affiliate of the Company), (ii) the
Exchange Offer is not consummated within 210 days of the Issue Date, (iii) in
certain circumstances, certain holders of unregistered Exchange Debentures so
request within 180 days after the consummation of the Exchange Offer or (iv)
in the case of any holder of Original Debentures that participates in the
Exchange Offer, such holder of Original Debentures does not receive Exchange
Debentures on the date of the exchange that may be sold without restriction
under state and federal securities laws (other than due solely to the status
of such holder of Original Debentures as an Affiliate of the Company) and so
notifies the Company within 60 days after such holder of Original Debentures
first becomes aware of such restriction and provides the Company with a
reasonable basis for its conclusion, in the case of each of clauses (i)-(iv)
of this sentence, the Company will file with the Commission a registration
statement (the "Shelf Registration Statement") to cover resales of the
Original Debentures by the holders thereof who satisfy certain conditions
relating to the provision of information in connection with the Shelf
Registration Statement. In the event that (i) the Company fails to file the
Exchange Offer Registration Statement, (ii) the Exchange Offer Registration
Statement or, if applicable, the Shelf Registration Statement, is not declared
effective by the Commission, or (iii) the Exchange Offer is not consummated
or the Shelf Registration Statement ceases to be effective, in each case
within specified time periods, the Company is required to pay liquidated
damages to the holders of the Original Debentures. See "Original Debentures
Registration Rights."
Terms of the Exchange
The Company hereby offers to exchange, upon the terms and
subject to the conditions set forth herein and in the Letter of Transmittal
accompanying this Registration Statement of which this Prospectus is a part
(the "Letter of Transmittal"), $1,000 in principal amount of Exchange
Debentures for each $1,000 in principal amount of Original Debentures. The
terms of the Exchange Debentures are substantially similar to the terms of the
Original Debentures for which they may be exchanged pursuant to this Exchange
Offer, except that the Exchange Debentures will generally be freely
transferable by holders thereof, and the holders of the Exchange Debentures
(as well as remaining holders of any Original Debentures) will not be entitled
to registration rights under the Registration Rights Agreement. The Exchange
Debentures will evidence the same debt as the Original Debentures and will be
entitled to the benefits of the Indenture. See "Description of the
Debentures."
The Exchange Offer is not conditioned upon any minimum
aggregate principal amount of Original Debentures being tendered or accepted
for exchange.
Based on its view of interpretations set forth in no-action
letters issued by the Staff to third parties, the Company believes that
Exchange Debentures issued pursuant to the Exchange Offer in exchange for the
Original Debentures may be offered for resale, resold and otherwise
transferred by holders thereof (other than any holder of any such other person
which is (i) an Affiliate of the Company, (ii) a broker-dealer who acquired
Original Debentures directly from the Company or (iii) a broker-dealer who
acquired Original Debentures as a result of market making or other trading
activities) without compliance with the registration and prospectus delivery
provisions of the Securities Act provided that such Exchange Debentures are
acquired in the ordinary course of business of such holder and any beneficial
owner, and such holders are not engaged in, and do not intend to engage in,
and have no arrangement or understanding with any person to participate in, a
distribution of such Exchange Debentures. Each broker-dealer who acquired
Original Debentures directly from the Company and is participating in the
Exchange Offer must comply with the registration and prospectus delivery
provisions of the Securities Act. Broker-dealers who acquired Original
Debentures as a result of market making or other trading activities may use
this Prospectus, as supplemented or amended, in connection with resales of the
Exchange Debentures. The Company has agreed that, for a period of 120 days
after this Registration Statement is declared effective, it will make this
Prospectus available to any broker-dealer for use in connection with any such
resale. Each broker-dealer who receives Exchange Debentures pursuant to the
Exchange Offer must acknowledge that it will deliver a prospectus in
connection with any resale of such Exchange Debentures. The Letter of
Transmittal states that by so acknowledging, and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within
the meaning of the Securities Act. Any holder that cannot rely upon such
interpretations must comply with the registration and prospectus delivery
requirements of the Securities Act in connection with a secondary resale
transaction.
Tendering holders of Original Debentures will not be required
to pay brokerage commissions or fees or, subject to the instructions in the
Letter of Transmittal, transfer taxes with respect to the exchange of the
Original Debentures pursuant to the Exchange Offer.
Interest on the Exchange Debentures will accrue (i) from the
last interest payment date on which interest was paid on the Original
Debentures surrendered in exchange therefor or (ii) if no interest has been
paid on the Original Debentures, from the original issue date of the Original
Debentures.
Expiration Date; Extensions; Termination; Amendments
The Exchange Offer expires on the Expiration Date. The term
"Expiration Date" means 5:00 p.m., New York City time, on ,
1997 unless the Company in its sole discretion extends the period during which
the Exchange Offer is open, in which event the term "Expiration Date" means
the latest time and date on which the Exchange Offer, as so extended by the
Company, expires. The Company reserves the right to extend the Exchange Offer
at any time and from time to time prior to the Expiration Date by giving
written notice to The Chase Manhattan Bank (the "Exchange Agent") and by
timely public announcement communicated by no later than 5:00 p.m. on the next
business day following the Expiration date, unless otherwise required by
applicable law or regulation, but making a release to the Dow Jones News
Service. During any extension of the Exchange Offer, all Original Debentures
previously tendered pursuant to the Exchange Offer will remain subject to the
Exchange Offer.
The initial Exchange Date will be the first business day
following the Expiration Date. The Company expressly reserves the right to
(i) terminate the Exchange Offer and not accept for exchange any Original
Debentures for any reason, including if any of the events set forth below
under "Condition to the Exchange Offer" shall have occurred and shall not have
been waived by the Company and (ii) amend the terms of the Exchange Offer in
any manner, whether before or after any tender of the Original Debentures. If
any such termination or amendment occurs, the Company will notify the Exchange
Agent in writing and will either issue a press release or give written notice
to the holders of the Original Debentures as promptly as practicable. Unless
the Company terminates the Exchange Offer prior to 5:00 p.m., New York City
time, on the Expiration Date, the Company will exchange the Exchange
Debentures for the Original Debentures on the Exchange Date.
If the Company waives any material condition to the Exchange
Offer, or amends the Exchange Offer in any other material respect, and if at
the time that notice of such waiver or amendment is first published, sent or
given to holders of Original Debentures in the manner specified above, the
Exchange Offer is scheduled to expire at any time earlier than the expiration
of a period ending on the fifth business day from and including, the date that
such notice is first so published, sent or given, then the Exchange Offer will
be extended until the expiration of such period of five business days. If
there is an increase or decrease in the consideration offered for the Original
Debentures, or a decrease in the percentage of Exchange Debentures offered by
the Company in exchange for Original Debentures, notice of such increase or
decrease shall be published, sent or given to all holders of Original
Debentures in the manner specified above and the Exchange Offer will be
extended at least ten business days from when such notice is first published,
sent or given to the holders of Original Debentures.
The Company will file a post-effective amendment to the
Registration Statement of which this Prospectus is a part, and mail or
otherwise deliver copies of such amendment to holders of the Original
Debentures, if any one of the following events arises after the Registration
Statement of which this Prospectus is a part has been declared effective by
the Commission: (a) the Company materially amends the Exchange Offer or (b)
any facts or events arise which individually, or in the aggregate, represent a
fundamental change in the information set forth in the Registration Statement,
or the information set forth under the caption "Plan of Distribution" therein.
This Prospectus and the related Letter of Transmittal and other
relevant materials will be mailed by the Company to record holders of Original
Debentures and will be furnished to brokers, banks and similar persons whose
names, or the names of whose nominees, appear on the lists of holders for
subsequent transmittal to beneficial owners of Original Debentures.
How to Tender
The tender to the Company of Original Debentures by a holder
thereof pursuant to one of the procedures set forth below will constitute an
agreement between such holder and the Company in accordance with the terms and
subject to the conditions set forth herein and in the Letter of Transmittal.
General Procedures. A holder of an Original Debenture may
tender the same by (i) properly completing and signing the Letter of
Transmittal or a facsimile thereof (all references in this Prospectus to the
Letter of Transmittal shall be deemed to include a facsimile thereof) and
delivering the same, together with the certificate or certificates
representing the Original Debentures being tendered and any required signature
guarantees (or a timely confirmation of a book entry transfer (a "Book Entry
Confirmation") pursuant to the procedure described below), to the Exchange
Agent at its address set forth on the back cover of this Prospectus on or
prior to the Expiration Date or (ii) complying with the guaranteed delivery
procedures described below.
If tendered Original Debentures are registered in the name of
the signer of the Letter of Transmittal and the Exchange Debentures to be
issued in exchange therefor are to be issued (and any untendered Original
Debentures are to be reissued) in the name of the registered holder, the
signature of such signer need not be guaranteed. In any other case, the
tendered Original Debentures must be endorsed or accompanied by written
instruments of transfer in form satisfactory to the Company and duly executed
by the registered holder and the signature on the endorsement or instrument of
transfer must be guaranteed by a bank, broker, dealer, credit union, savings
association, clearing agency or other institution (each an "Eligible
Institution") that is a member of a recognized signature guarantee medallion
program within the meaning of Rule 17Ad-15 under the Exchange Act. If the
Exchange Debentures and/or Original Debentures not exchanged are to be
delivered to an address other than that of the registered holder appearing on
the Debenture register for the Original Debentures, the signature on the
Letter of Transmittal must be guaranteed by an Eligible Institution.
Any beneficial owner whose Original Debentures are registered
in the name of a broker, dealer, commercial bank, trust company or other
nominee and who wishes to tender Original Debentures should contact such
holder promptly and instruct such holder to tender Original Debentures on such
beneficial owner's behalf. If such beneficial owner wishes to tender such
Original Debentures himself, such beneficial owner must, prior to completing
and executing the Letter of Transmittal and delivering such Original
Debentures either make appropriate arrangements to register ownership of the
Original Debentures in such beneficial owner's name or follow the procedures
described in the immediately preceding paragraph. The transfer of record
ownership may take considerable time.
Book-Entry Transfer. The Exchange Agent will make a request to
establish an account with respect to the Original Debentures at the Depository
Trust Company (the "Depositary") for purposes of the Exchange Offer within two
business days after receipt of this Prospectus, and any financial institution
that is a participant in the Depositary may make book-entry delivery of
Original Debentures by causing the Depositary to transfer such Original
Debentures into the Exchange Agent's account at the Depositary in accordance
with the Depositary's procedures for transfer. However, although delivery of
Original Debentures may be effected through book entry transfer at the
Depositary, the Letter of Transmittal, with any required signature guarantees
or an Agent's Message (as defined below) in connection with a book-entry
transfer and any other required documents, must, in any case, be transmitted
to and received by the Exchange Agent at the address specified on the back
cover page of this Prospectus on or prior to the Expiration Date or the
guaranteed delivery procedures describe below must be complied with.
A holder may tender Original Debentures that are held through
the Depositary by transmitting its acceptance through the Depositary's
Automatic Tender Offer Program ("ATOP"), for which the transaction will be
eligible, and the Depositary will then edit and verify the acceptance and send
an Agent's Message to the Exchange Agent for its acceptance. The term
"Agent's Message" means a message transmitted by the Depositary to, and
received by, the Exchange Agent and forming part of the Book-Entry
Confirmation, which states that the Depositary has received an express
acknowledgment from each participant in the Depositary tendering the Original
Debentures and that such participant has received the Letter of Transmittal
and agrees to be bound by the terms of the Letter of Transmittal and the
Company may enforce such agreement against such participant.
THE METHOD OF DELIVERY OF ORIGINAL DEBENTURES AND ALL OTHER
DOCUMENTS IS AT THE ELECTION AND RISK OF THE HOLDER. IF SENT BY MAIL, IT IS
RECOMMENDED THAT REGISTERED MAIL, RETURN RECEIPT REQUESTED, BE USED, PROPER
INSURANCE BE OBTAINED, AND THE MAILING BE MADE SUFFICIENTLY IN ADVANCE OF THE
EXPIRATION DATE TO PERMIT DELIVERY TO THE EXCHANGE AGENT ON OR BEFORE THE
EXPIRATION DATE.
Guaranteed Delivery Procedures. If a holder desires to accept
the Exchange Offer and time will not permit a Letter of Transmittal or
Original Debentures to reach the Exchange Agent before the Expiration Date, a
tender may be effected if the Exchange Agent has received at its office listed
on the back cover hereof on or prior to the Expiration Date a letter, telegram
or facsimile transmission from an Eligible Institution setting forth the name
and address of the tendering holder, the principal amount of the Original
Debentures being tendered, the names in which the Original Debentures are
registered and, if possible, and if applicable, the certificate numbers of the
Original Debentures to be tendered, and stating that the tender is being made
thereby and guaranteeing that within three New York Stock Exchange trading
days after the date of execution of such letter, telegram or facsimile
transmission by the Eligible Institution, the Original Debentures, in proper
form for transfer, will be delivered by such Eligible Institution together
with a properly completed and duly executed Letter of Transmittal (and any
other required documents). Unless Original Debentures being tendered by the
above-described method (or a timely Book-Entry Confirmation) are deposited
with the Exchange Agent within the time period set forth above (accompanied or
preceded by a properly completed Letter of Transmittal (or facsimile thereof)
and any other required documents), or a properly completed Agent's Message is
received by the Exchange Agent within the time period set forth above, the
Company may, at its option, reject the tender. Copies of a Notice of
Guaranteed Delivery which may be used by Eligible Institutions for the
purposes described in this paragraph are available from the Exchange Agent.
A tender will be deemed to have been received as of the date
when the tendering holder's properly completed and duly signed Letter of
Transmittal accompanied by the Original Debentures (or a timely Book-Entry
Confirmation) or properly completed Agent's Message, is received by the
Exchange Agent. Issuances of Exchange Debentures in exchange for Original
Debentures tendered pursuant to a Notice of Guaranteed Delivery or letter,
telegram or facsimile transmission to similar effect (as provided above) by an
Eligible Institution will be made only against deposit of the Letter of
Transmittal (and any other required documents) and the tendered Original
Debentures (or a timely Book-Entry Confirmation).
All questions as to the validity, form, eligibility (including
time of receipt) and acceptance for exchange of any tender of Original
Debentures will be determined by the Company, whose determination will be
final and binding. The Company reserves the absolute right to reject any or
all tenders not in proper form or the acceptances for exchange of which may,
in the opinion of counsel to the Company, be unlawful. The Company also
reserves the absolute right to waive any of the conditions of the Exchange
Offer or any defect or irregularities in tenders of any particular holder
whether or not similar defects or irregularities are waived in the case of
other holders. Neither the Company, the Exchange Agent nor any other person
will be under any duty to give notification of any defects or irregularities in
tenders or shall incur any liability for failure to give any such
notification. The Company's interpretation of the terms and conditions of the
Exchange Offer (including the Letter of Transmittal and the instructions
thereto) will be final and binding.
Terms and Conditions of the Letter of Transmittal
The Letter of Transmittal contains, among other things, the
following terms and conditions, which are part of the Exchange Offer.
The party tendering Original Debentures for exchange (the
"Transferor") thereby exchanges, assigns and transfers the Original Debentures
to the Company and irrevocably constitutes and appoints the Exchange Agent as
the Transferor's agent and attorney-in-fact to cause the Original Debentures
to be assigned, transferred and exchanged. The Transferor represents and
warrants that it has full power and authority to tender, exchange, assign and
transfer the Original Debentures and to acquire Exchange Debentures issuable
upon the exchange of such tendered Original Debentures, and that, when the
same are accepted for exchange, the Company will acquire good and unencumbered
title to the tendered Original Debentures, free and clear of all liens,
restrictions, charges and encumbrances and not subject to any adverse claim.
The Transferor also warrants that it will, upon request, execute and deliver
any additional documents deemed by the Company to be necessary or desirable to
complete the exchange, assignment and transfer of tendered Original
Debentures. The Transferor further agrees that acceptance of any tendered
Original Debentures by the Company and the issuance of Exchange Debentures in
exchange therefor shall constitute performance in full by the Company of its
obligations under the Registration Rights Agreement and that the Company shall
have no further obligations or liabilities thereunder (except in certain
limited circumstances). All authority conferred by the Transferor will
survive the death or incapacity of the Transferor and every obligation of the
Transferor shall be binding upon the heirs, legal representatives, successors,
assigns, executors and administrators of such Transferor.
By tendering Original Debentures and executing the Letter of
Transmittal, the Transferor certifies (a) that it is not an Affiliate of the
Company, that it is not a broker-dealer that owns Original Debentures acquired
directly from the Company or an affiliate of the Company, that it is acquiring
the Exchange Debentures offered hereby in the ordinary course of such
Transferor' business and that such Transferor has no arrangement with any
person to participate in the distribution of such Exchange Debentures; (b)
that it is an Affiliate of the Company or of the Initial Purchasers of the
Original Debentures in the Initial Offering and that it will comply with the
registration and prospectus delivery requirements of the Securities Act to the
extent applicable to it; or (c) that it is a participating broker-dealer and
that it will deliver a prospectus in connection with any resale of the
Exchange Debentures.
Withdrawal Rights
Original Debentures tendered pursuant to the Exchange Offer may
be withdrawn at any time prior to the Expiration Date.
For a withdrawal to be effective, a written or facsimile
transmission notice of withdrawal must be timely received by the Exchange
Agent at its address set forth on the back cover of this Prospectus prior to
the Expiration Date. Any such notice of withdrawal must specify the person
named in the Letter of Transmittal as having tendered Original Debentures to
be withdrawn, the certificate numbers of Original Debentures to be withdrawn,
the principal amount of Original Debentures to be withdrawn, a statement that
such holder is withdrawing his election to have such Original Debentures
exchanged, and the name of the registered holder of such Original Debentures,
and must be signed by the holder in the same manner as the original signature
on the Letter of Transmittal (including any required signature guarantees) or
be accompanied by evidence satisfactory to the Company that the person
withdrawing the tender has succeeded to the beneficial ownership of the
Original Debentures being withdrawn. The Exchange Agent will return the
properly withdrawn Original Debentures promptly following receipt of notice of
withdrawal. All questions as to the validity of notices of withdrawals,
including time of receipt, will be determined by the Company, and such
determination will be final and binding on all parties.
Acceptance of Original Debentures for Exchange; Delivery of Exchange
Debentures
Upon the terms and subject to the conditions of the Exchange
Offer, the acceptance for exchange of Original Debentures validly tendered and
not withdrawn and the issuance of the Exchange Debentures will be made on the
Exchange Date. For the purposes of the Exchange Offer, the Company shall be
deemed to have accepted for exchange validly tendered Original Debentures
when, as and if the Company has given written notice thereof to the Exchange
Agent.
The Exchange Agent will act as agent for the tendering holders
of Original Debentures for the purposes of receiving Exchange Debentures from
the Company and causing the Original Debentures to be assigned, transferred
and exchanged. Upon the terms and subject to the conditions of the Exchange
Offer, delivery of Exchange Debentures to be issued in exchange for accepted
Original Debentures will be made by the Exchange Agent promptly after
acceptance of the tendered Original Debentures not accepted for exchange by
the Company will be returned without expense to the tendering holders (or in
the case of Original Debentures tendered by book-entry transfer into the
Exchange Agent's account at the Depositary pursuant to the procedures
described above, such non-exchanged Original Debentures will be credited to an
account maintained with such Depositary) promptly following the Expiration Date
or, if the Company terminates the Exchange Offer prior to the Expiration Date,
promptly after the Exchange Offer is so terminated.
Conditions to the Exchange Offer
Notwithstanding any other provision of the Exchange Offer, or
any extension of the Exchange Offer, the Company will not be required to issue
Exchange Debentures in respect of any properly tendered Original Debentures not
previously accepted and may terminate the Exchange Offer (by oral or written
notice to the Exchange Agent and by timely public announcement communicated by
no later than 9:00 a.m. on the next business day following the Expiration
Date, unless otherwise required by applicable law or regulation, by making a
release to the Dow Jones News Serviced or, at its option, modify or otherwise
amend the Exchange Offer, if (a) there shall be threatened, instituted or
pending any action or proceeding before, or any injunction, order or decree
shall have been issued by, any court or governmental agency or other
governmental regulatory or administrative agency or commission, (i) seeking to
restrain or prohibit the making of consummation of the Exchange Offer or any
other transaction contemplated by the Exchange Offer, (ii) assessing or
seeking any damages as a result thereof, or (iii) resulting in a material
delay in the ability of the Company to accept for exchange or exchange some or
all of the Original Debentures pursuant to the Exchange Offer; (b) any
statute, rule, regulation, order or injunction shall be sought, proposed,
introduced, enacted, promulgated or deemed applicable to the Exchange Offer or
any of the transactions contemplated by the Exchange Offer by any government
or governmental authority, domestic or foreign, or any action shall have been
taken, proposed or threatened, by any government, governmental authority,
agency or court, domestic or foreign that in the reasonable judgment of the
Company might directly or indirectly result in any of the consequences
referred to in clauses (a)(i) or (ii) above or, in the reasonable judgment of
the Company, might result in the holders of Exchange Debentures having
obligations with respect to resales and transfers of Exchange Debentures which
are greater than those described in the interpretations of the Commission
referred to on the cover page of this Prospectus, or would otherwise make it
inadvisable to proceed with the Exchange Offer; or (c) a material adverse
change shall have occurred in the business, condition (financial or
otherwise), operations, or prospects of the Company.
The foregoing conditions are for the sole benefit of the
Company and may be asserted by it with respect to all or any portion of the
Exchange Offer regardless of the circumstances (including any action or
inaction by the Company) giving rise to such condition or may be waived by the
Company in whole or in part at any time or from time to time in their sole
discretion. The failure by the Company at any time to exercise any of the
foregoing rights will not be deemed a waiver of any such right, and each right
will be deemed an ongoing right which may be asserted at any time or from time
to time. In addition, the Company has reserved the right, notwithstanding the
satisfaction of each of the foregoing conditions, to terminate or amend the
Exchange Offer.
Any determination by the Company concerning the fulfillment or
non-fulfillment of any conditions will be final and binding upon all parties.
In addition, the Company will not accept for exchange any
Original Debentures tendered and no Exchange Debentures will be issued in
exchange for any such Original Debentures, if at such time any stop order
shall be threatened or in effect with respect to the Registration Statement of
which this Prospectus constitutes a part or qualification of the Indenture
under the Trust Indenture Act of 1939 as amended (the "Trust Indenture Act").
Exchange Agent
The Chase Manhattan Bank has been appointed as the Exchange
Agent for the Exchange Offer. Letters of Transmittal must be addressed to the
Exchange Agent at its address set forth on the back cover page of this
Prospectus.
Delivery to an address other than as set forth herein, or
transmissions of instructions via a facsimile or telex number other than the
ones set forth herein, will not constitute a valid delivery.
Solicitation of Tenders
The Company has not retained any dealer-manager or similar
agent in connection with the Exchange Offer and will not make any payments to
brokers, dealers or others for soliciting acceptances of the Exchange Offer.
The Company will, however, pay the Exchange Agent reasonable and customary
fees for its services, and will reimburse it for reasonable out-of-pocket
expenses in connection therewith. The Company will also pay brokerage houses
and other custodians, nominees and fiduciaries the reasonable out-of-pocket
expenses incurred by them in forwarding tenders for their customers. The
expenses to be incurred in connection with the Exchange Offer, including the
fees and expenses of the Exchange Agent and printing, accounting and legal
fees, will be paid by the Company and are estimated at approximately $ .
No person has been authorized to give any information or to
make any representations in connection with the Exchange Offer other than
those contained in this Prospectus. If given or made, such information or
representations should not be relied upon as having been authorized by the
Company. Neither the delivery of this Prospectus nor any exchange made
hereunder shall, under any circumstances, create any implication that there
has been no change in the affairs of the Company since the respective dates as
of which information is given herein. The Exchange Offer is not being made to
(nor will tenders be accepted from or on behalf of) holders of Original
Debentures in any jurisdiction in which the making of the Exchange Offer or
the acceptance thereof would not be in compliance with the laws of such
jurisdiction. However, the Company may, at its discretion, take such action
as it may deem necessary to make the Exchange Offer in any such jurisdiction
and extend the Exchange Offer to holders of Original Debentures in such
jurisdiction. In any jurisdiction the securities laws or blue sky laws of
which require the Exchange Offer to be made by a licensed broker or dealer,
the Exchange Offer is being made on behalf of the Company by one or more
registered brokers or dealers which are licensed under the laws of such
jurisdiction.
Appraisal Rights
HOLDERS OF ORIGINAL DEBENTURES WILL NOT HAVE DISSENTERS' RIGHTS
OR APPRAISAL RIGHTS IN CONNECTION WITH THE EXCHANGE OFFER.
Federal Income Tax Consequences
There will be no Federal income tax consequences to Holders
exchanging Original Debentures for Exchange Debentures pursuant to the
Exchange Offer. An exchanging Holder will have the same adjusted basis and
holding period in the Exchange Debentures as it had in the Original Debentures
immediately before the exchange and in general will be subject to the same
Federal income tax treatment as if it had continued to hold the Original
Debentures.
Consequences of Failure to Exchange
Participation in the Exchange Offer is voluntary and holders
should carefully consider whether to accept. Holders of the Original
Debentures are urged to consult their financial and tax advisors in making
their own decisions on what action to take.
As a result of the making of, and upon acceptance for exchange
of all validly tendered Original Debentures pursuant to the terms of this
Exchange Offer, the Company will have fulfilled a covenant contained in the
terms of the Original Debentures and the Registration Rights Agreement.
Holders of the Original Debentures who do not tender their certificates in the
Exchange Offer will continue to hold such certificates and will be entitled to
all the rights, and limitations applicable thereto, under the Indenture,
except for any such rights under the Registration Rights Agreement, which by
their terms terminate or cease to have further effect as a result of the
making of this Exchange Offer. See "Description of the Debentures." Holders
of Original Debentures who do not exchange their Original Debentures for
Exchange Debentures pursuant to the Exchange Offer will continue to be subject
to the restrictions on transfer of such Original Debentures as set forth in
the legend thereon as a consequence of the issuance of the Original Debentures
pursuant to exemptions from, or in transactions not subject to, the
registration requirements of the Securities Act and applicable state
securities laws. In general, the Original Debentures may not be offered or
sold, unless registered under the Securities Act and applicable state
securities laws, or pursuant to an exemption therefrom. Except under certain
limited circumstances, the Company does not intend to register the Original
Debentures under the Securities Act. In addition, any holder of Original
Debentures who tenders in the Exchange Offer for the purpose of participating
in a distribution of the Exchange Debentures may be deemed to have received
restricted securities and, if so, will be required to comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any resale transaction. To the extent that Original
Debentures are tendered and accepted in the Exchange Offer, the trading
market, if any, for the Original Debentures could be adversely affected.
The Company may in the future seek to acquire untendered
Original Debentures in open market or privately negotiated transactions,
through subsequent exchange offers or otherwise. The Company has no present
plan to acquire any Original Debentures which are not tendered in the Exchange
Offer.
CAPITALIZATION
The following table sets forth the consolidated capitalization
of the Company as of September 30, 1996 and as adjusted to give effect to the
issuance of the Original Debentures and application of the net proceeds
thereof.
September 30, 1996
-------------------------
Outstanding As Adjusted
------------ -----------
(dollars in millions)
Cash and temporary cash investments.............. $ 8.5 $ 81.5
====== ========
Total debt....................................... $511.4 $586.4
Stockholder's equity:
Common stock, $1.00 par value; 100 shares
authorized; 100 shares issued
and outstanding............................... - -
Additional paid-in capital...................... 129.5 129.5
Retained income................................. 331.0 331.0
------ --------
Total capitalization.......................... $971.9 $1,046.9
====== ========
The holders of the Debentures may be entitled to liquidated
damages in certain circumstances if the Company does not meet its registration
requirements with respect to the Debentures. See "Original Debentures
Registration Rights."
SELECTED HISTORICAL FINANCIAL INFORMATION
The selected historical financial information set forth below
at December 31, 1995, 1994, 1993, 1992 and 1991 and for the years then ended
has been derived from the Company's consolidated financial statements, which
have been audited by Arthur Andersen LLP, independent public accountants. The
selected historical financial information set forth below at September 30,
1996 and for the nine month periods ended September 30, 1996 and 1995 has been
derived from the Company's unaudited interim financial statements, which in
the opinion of the Company's management include all adjustments, consisting
only of normal recurring adjustments, necessary for a fair presentation of the
results of operations for the unaudited interim periods. Interim operating
results and balance sheet information are not necessarily indicative of the
operating results or financial condition that may be expected for the full
year. The selected historical financial information set forth below should be
read in conjunction with the Company's consolidated financial statements and
Debentures thereto and Management's Discussion and Analysis of Financial
Condition and Results of Operations with respect thereto incorporated herein
by reference.
<TABLE>
<CAPTION>
Nine Months ended
September 30,
(unaudited) Year Ended December 31,
-------------------- ---------------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Income Statement Data:
Revenues............................. $462.8 $485.8 $643.8 $593.9 $564.7 $547.4 $549.7
Operating expenses before
special charge...................... 297.8 319.1 421.9 401.5 387.1 388.2 404.6
Special charge....................... -- -- -- -- -- 8.9 --
Operating income..................... 165.0 166.7 221.9 192.4 177.6 150.3 145.1
Other income (expense), net.......... 1.7 2.2 2.7 4.5 2.8 3.6 7.0
Interest expense, net................ (19.7) (20.4) (26.3) (26.0) (31.8) (42.9) (56.1)
Income before income taxes,
extraordinary item and
cumulative effect of changes
in accounting principles............ 147.0 148.5 198.3 170.9 148.6 111.0 96.0
Provisions for income taxes.......... 57.1 55.7 67.1 58.2 56.6 37.7 30.7
Income before extraordinary
item and cumulative effect of
changes in accounting
principles.......................... 89.9 92.8 131.2 112.7 92.0 73.3 65.3
Extraordinary item, net.............. -- (11.4) (11.4) -- (23.4) -- --
Cumulative effect of changes in
accounting principles................ -- -- -- -- (0.1) 23.7 --
Net income........................... $89.9 $81.4 $119.8 $112.7 $68.5 $97.0 $65.3
Ratio of earnings to fixed
charges (1)......................... 5.67 6.26 5.68 4.75 3.96 2.81 2.26
Pro forma ratio of earnings to fixed
charges (2).......................... 4.95 4.92
</TABLE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
September 30,
(unaudited) December 31,
-------------------- ---------------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
(dollars in millions)
Balance Sheet Data:
Total assets.............. $1,517.8 $1,378.3 $1,392.8 $1,258.4 $1,213.7 $1,187.4 $1,153.8
Long-term debt............ 508.5 347.6 373.9 297.6 347.3 356.9 403.2
Stockholder's equity...... 460.5 (3) 437.4 465.0 392.4 366.8 331.5 243.7
Working capital (deficit). (33.8) (87.7) (55.6) (116.3) (12.6) (9.4) (18.6)
</TABLE>
- ----------
(1) For purposes of these computations, earnings before fixed charges consist
of income before income taxes, extraordinary item and cumulative effect of
accounting changes plus fixed charges less capitalized interest. Fixed
charges consist of interest on indebtedness including the amortization of
debt issuance costs, capitalized interest and the portion of
non-capitalized lease expense representative of interest.
(2) After giving effect to the issuance of the Debentures and the application
of the proceeds thereof to repay approximately $50 million of the
Company's commercial paper.
(3) In October 1996, the Company declared and paid a $14.5 million dividend
to IC.
DESCRIPTION OF DEBENTURES
The Exchange Debentures will be issued, and the Original
Debentures were issued, under an indenture dated as of July 25, 1996, as
supplemented (the "Indenture"), between the Company and The Chase Manhattan
Bank, as trustee (the "Trustee"). The terms of the Debentures include those
stated in the Indenture or established pursuant to the terms thereof and
those made part of the Indenture by reference to the Trust Indenture Act of
1939 (the "Trust Indenture Act"), as in effect on the date of the Indenture.
The Debentures are subject to all such terms, and prospective investors are
referred to the Indenture and the Trust Indenture Act for a statement of such
terms.
The Indenture provides for issuance of debentures, Debentures
or other evidences of indebtedness by the Company ("Securities") in one or
more series in an unlimited amount from time to time. The Debentures
constitute a series of Securities under the Indenture.
The statements under this caption relating to the Debentures
and the Indenture are summaries and do not purport to be complete. Such
summaries make use of certain terms defined in the Indenture and are qualified
in their entirety by express reference to the Indenture, a copy of which is
available upon request from the Company or the Trustee. Whenever particular
Sections or defined terms of the Indenture are referred to herein, such
Sections or defined terms are incorporated herein by reference.
General
The Exchange Debentures will bear interest at a rate of 7.70%
per annum from the date such Exchange Debentures are first issued under the
Indenture, payable semiannually on March 15 and September 15 of each year,
commencing March 15, 1997, to Holders of record at the close of business on
the March 1 or September 1 immediately preceding each such interest payment
date. Holders whose Original Debentures are accepted for exchange will
receive accrued interest thereon to, but not including, the date of issuance
of the Exchange Debentures. The Debentures will be due on September 15, 2096,
and will be issued only in registered form, without coupons, in denominations
of $1,000 and integral multiples thereof.
The holders of the Debentures may be entitled to liquidated
damages in certain circumstances if the Company does not meet its registration
requirements with respect to the Debentures. See "Original Debentures
Registration Rights."
The Debentures are unsecured obligations of the Company limited
to an aggregate amount of $125 million. The Debentures will rank senior in
right of payment to all subordinated indebtedness of the Company and pari
passu with all existing and future senior unsecured indebtedness of the
Company.
Redemption
Optional Redemption. The Debentures may not be redeemed prior
to September 15, 2026. The Debentures will be subject to redemption at any
time on or after September 15, 2026, at the option of the Company, in whole or
in part, at the following redemption prices (expressed as percentages of the
principal amount), plus accrued and unpaid interest and Liquidated Damages, if
any, to the redemption date, if redeemed during the 12-month period beginning
September 15 of the years indicated below:
Redemption Redemption Redemption
Year Price Year Price Year Price
- ---- ---------- ---- ---------- ----
----------
2026.... 102.92% 2033... 101.90% 2040.................. 100.88%
2027.... 102.77% 2034... 101.75% 2041.................. 100.73%
2028.... 102.63% 2035... 101.60% 2042.................. 100.58%
2029.... 102.48% 2036... 101.46% 2043.................. 100.44%
2030.... 102.33% 2037... 101.31% 2044.................. 100.29%
2031.... 102.19% 2038... 101.17% 2045.................. 100.15%
2032.... 102.04% 2039... 101.02% 2046 and thereafter... 100.00%
If the maturity is shortened as provided below under
"Conditional Right to Shorten Maturity", then the redemption prices set forth
above will remain unchanged to but excluding the shortened maturity date and
the amount payable by the Company at maturity with respect to outstanding
Debentures will be 100% of the principal amount thereof, together with accrued
and unpaid interest and Liquidated Damages, if any.
Selection and Notice of Redemption. In the event that less
than all of the Debentures are to be redeemed at any time, selection of
Debentures for redemption will be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which
the Debentures are listed or, if the Debentures are not listed on a national
securities exchange, on a pro rata basis, provided, however, that the
Debentures will be redeemed only in the amount of $1,000 or integral multiples
thereof. Notice of redemption to the Holders of Debentures to be redeemed as
a whole or in part shall be given by mailing notice of such redemption by
first-class mail, postage prepaid, at least 30 days and not more than 60 days
prior to the date fixed for redemption to such Holders of Debentures at their
last addresses as they shall appear upon the registry books. Unless the
Company defaults in payment of the redemption price, on and after the
redemption date, interest and Liquidated Damages, if any, cease to accrue on
Debentures or portions thereof called for redemption. (Section 3.2)
Sinking Fund. There will be no sinking fund for the Debentures.
Conditional Right to Shorten Maturity
The Company intends to deduct interest paid on the Debentures
for Federal income tax purposes. However, the Clinton Administration's budget
proposal for fiscal year 1997, released on March 19, 1996, contains a series of
proposed tax law changes that, among other things, would prohibit an issuer
from deducting interest payments on debt instruments with a maturity of more
than 40 years. On March 29, 1996, the Chairmen of the Senate Finance Committee
and the House Ways and Means Committee issued a statement to the effect that
this proposal, if enacted, would not be effective prior to the date of
"appropriate congressional action." There can be no assurance, however, that
this proposal or similar legislation affecting the Company's ability to deduct
interest paid on the Debentures will not be enacted in the future or that any
such legislation would not have a retroactive effective date.
Upon occurrence of a Tax Event (as defined below), the Company
will have the right to shorten the maturity of the Debentures to the extent
required, in the opinion of a nationally recognized independent tax counsel,
so that, after the shortening of the maturity, interest paid on the Debentures
will be deductible for Federal income tax purposes. The Company may exercise
its right to shorten the maturity of the Debentures upon the occurrence of a
Tax Event.
In the event that the Company elects to exercise its right to
shorten the maturity of the Debentures on the occurrence of a Tax Event, the
Company will mail a notice of shortened maturity to each Holder of record of
the Debentures by first-class mail not more than 60 days after the occurrence
of such Tax Event, stating the new maturity date of the Debentures. Such
notice shall be effective immediately upon mailing.
The Company believes that under current law the Debentures
should constitute indebtedness for Federal income tax purposes and an exercise
of its right to shorten the maturity of the Debentures should not be a taxable
event to Holders. Prospective investors should be aware, however, that the
Company's exercise of its right to shorten the maturity of the Debentures
would be a taxable event to Holders if the Debentures were treated as equity
for purposes of Federal income taxation due to the original term of the
Debentures before the maturity is shortened, assuming that the Debentures of
shortened maturity are treated as debt for such purposes.
"Tax Event" means that the Company shall have received an
opinion of a nationally recognized independent tax counsel to the effect that
on or after the date of the Offering Memorandum, as a result of (a) any
amendment to, clarification of, or change (including any announced prospective
change) in laws, or any regulations thereunder, of the United States, (b) any
judicial decision, official administrative pronouncement, ruling, regulatory
procedure, notice or announcement, including any notice or announcement of
intent to adopt such procedures or regulations (an "Administrative Action"),
or (c) any amendment to, clarification of, or change in the official position
or the interpretation of an Administrative Action or judicial decision that
differs from the theretofore generally accepted position, in each case, on or
after the date of the Offering Memorandum, such change in tax law creates a
more than insubstantial risk that interest paid by the Company on the
Debentures is not, or will not be, deductible, in whole or in part, by the
Company for purposes of Federal income tax.
Consolidation, Merger or Sale by the Company
The Company shall not consolidate or merge with any other
Person or sell, convey, assign, transfer, lease or otherwise dispose of all or
substantially all of its properties and assets as an entirety in one
transaction or series of transactions to any Person, unless (1) either (a) the
Company shall be the continuing Person or (b) such Person shall be a
corporation organized and validly existing under the laws of the United States
of America or any State thereof or the District of Columbia and shall
expressly assume by a supplemental indenture all of the Company's obligations
under the Securities and under the Indenture; (2) immediately before and after
such transaction or each element of such series, no Default or Event of
Default shall have occurred and be continuing; and (3) giving effect to such
transaction will not cause an event of default under any mortgage, bond,
debenture, Debenture or other instrument or obligation that the Company or any
Subsidiary of the Company is a party to or bound by. Upon any such
consolidation, merger, sale, conveyance, assignment, transfer, lease or other
disposition, the successor corporation formed by such consolidation, or into
which the Company is merged or to which such sale, conveyance, assignment,
transfer, lease or other disposition is made, shall succeed to, and be
substituted for, and may exercise every right and power of the Company under
the Indenture and under the Securities. (Sections 5.1 and 5.2)
Events of Default, Notice and Certain Rights on Default
Events of Default with respect to the Securities of any series
are defined in the Indenture as being: (a) failure to pay any installment of
interest on any Securities of such series when due and the continuance of such
failure for 30 days; (b) failure to pay the principal of any Securities of
such series when due; (c) failure for 60 days after notice to the Company by
the Trustee, or by the Holders of 25% in aggregate principal amount of the
Securities of such series then outstanding, to perform or observe any other
covenant, condition or agreement in the Securities of such series or in the
Indenture; (d) the Holders of other indebtedness of the Company or any
Subsidiary shall have declared an aggregate amount in excess of $20,000,000
thereof to be due and payable prior to the date on which it would otherwise
have become due or payable and such declaration shall not have been cured,
waived, rescinded or annulled or such indebtedness shall not have been
discharged within a period of 30 days; or (e) certain events of bankruptcy,
insolvency or reorganization of the Company or a Material Subsidiary; or (f)
any other Event of Default established for the Securities of such series.
(Section 6.1)
The Indenture provides that, if an Event of Default with
respect to the Securities of any series then outstanding thereunder occurs and
is continuing, then, either the Trustee for or the Holders of not less than
25% in aggregate principal amount of the Securities of any such affected
series then outstanding (each such series treated as a separate class) by
notice in writing to the Company (and to the Trustee if given by
Securityholders), may declare the entire principal (or, if the Securities of
any such series are Original Issue Discount Securities, such portion of the
principal amount as may be established for such series) of all Securities of
such affected series, and the interest accrued thereon, if any, to be due and
payable immediately, and upon any such declaration the same shall become
immediately due and payable, except that, if an Event of Default described in
clause (e) occurs and is continuing, then the principal amount (or, if any
Securities are Original Issue Discount Securities, such portion of the
principal as may be established for such series) of all the Securities then
outstanding and interest accrued thereon, if any, shall be and become
immediately due and payable, without any notice or other action by any Holder
or the Trustee therefor, to the full extent permitted by applicable law.
(Section 6.2)
The Indenture provides that the Trustee thereunder will, within
60 days after the occurrence of a Default with respect to the Securities, give
to the Holders of the Securities notice of all Defaults known to such Trustee,
provided that, except in the case of a Default in payment on the Securities,
the Trustee may withhold such notice if and so long as a Responsible Officer
in good faith determines that withholding such notice is in the interest of
the Holders of the Securities. (Section 7.5) "Default" means any event which
is, or after notice or passage of time or both would be, an Event of Default.
(Section 1.1)
The Indenture provides that the Holders of a majority in
aggregate principal amount of the then outstanding Securities thereunder, by
notice to the Trustee therefor, may direct the time, method and place of
conducting any proceeding for any remedy available to such Trustee, or
exercising any trust or power conferred on such Trustee. (Section 6.5)
Subject to the further conditions contained in the Indenture,
the Holders of a majority in aggregate principal amount outstanding of the
Securities of any series may waive, on behalf of the Holders of all Securities
of such series, any past Default or Event of Default and its consequences
except a Default or Event of Default (i) in the payment of the principal of or
interest, if any, on any Securities of such series or (ii) in respect of a
covenant or provision of the Indenture which cannot under the terms of the
Indenture be amended or modified without the consent of the Holder of each
outstanding Securities adversely affected thereby. (Section 6.4)
The term "Material Subsidiary" means each existing Subsidiary
of the Company and each Subsidiary hereafter acquired or formed by the Company
which, in each case, for the most recent fiscal year of the Company, was the
owner of 5% or more of the consolidated assets of the Company and its
Subsidiaries taken as a whole, as set forth on the consolidated financial
statements of the Company for such fiscal year. (Section 1.1)
The term "Subsidiary" means, with respect to any Person, any
corporation or other entity of which more than 50% of the shares of Voting
Stock are, at the time directly or indirectly owned by such Person. Unless
otherwise indicated, "Subsidiary" refers only to Subsidiaries of the Company.
(Section 1.1)
The term "Voting Stock" means stock of the class or classes
having general voting power under ordinary circumstances to elect at least a
majority of the board of directors, managers or trustees of a corporation or
other entity (irrespective of whether or not at the time stock of any other
class or classes shall have or might have voting power by reason of the
happening of any contingency). (Section 1.1)
Limitation on Liens
The Indenture provides that the Company will not, and will not
permit any Subsidiary to (a) create, issue, assume, incur or guarantee any
Debentures, bonds, debentures or other similar evidences of indebtedness for
money borrowed ("Debt") if such Debt is secured by a mortgage, pledge or lien
("Lien") upon, or (b) directly or indirectly secure any outstanding Debt by a
Lien upon, any Principal Property of the Company or any Subsidiary, now owned
or hereafter acquired, without effectively providing that the Securities shall
be secured equally and ratably with such Debt, except that the foregoing
restrictions shall not apply to (i) Liens on any Principal Property acquired
after the date of the Indenture to secure or provide for the payment or
refinancing of the purchase price or acquisition cost thereof, (ii) Liens on
any Principal Property to finance improvements thereof which do not exceed in
the aggregate $10,000,000 at any time, (iii) Liens on any Principal Property
of any corporation existing at the time such corporation becomes a Subsidiary
after the date of the Indenture, (iv) Liens in existence on Principal Property
on the date of the Indenture, (v) Liens to secure Debt of a Subsidiary to the
Company or another Subsidiary, (vi) Liens in favor of governmental bodies to
secure advance or progress payments pursuant to any contract or statute, (vii)
pledges or deposits in connection with workers' compensation, unemployment
insurance and other social security legislation and deposits securing
liability to insurance carriers under insurance or self-insurance
arrangements, (viii) Liens for taxes not yet due or which are being contested
in good faith by appropriate proceedings, (ix) any materialmen's, carriers',
mechanics', workmen's, repairmen's or other like Liens arising in the ordinary
course of business in respect of obligations which are not yet overdue or
which are being contested in good faith by appropriate proceedings, (x) Liens
arising in connection with surety, appeal and similar bonds incidental to the
conduct of litigation, (xi) Liens arising in connection with bid, performance
or similar bonds which do not exceed in the aggregate $5,000,000, (xii)
easements, rights of way, general real estate taxes not yet due and payable,
municipal and zoning restrictions, restrictions on the use of real property
and defects and irregularities in the title thereto and (xiii) any extension,
renewal, substitution or replacement (or successive extensions, renewals,
substitutions or replacements), in whole or in part, of any Lien referred to
in the foregoing clauses (i) through (xii), inclusive, or the Debt secured
thereby. (Section 4.5(a))
Notwithstanding the foregoing, the Company and any Subsidiary
may, without equally and ratably securing the Securities, create, issue,
assume, incur or guarantee secured Debt (which would otherwise be subject to
the foregoing Lien restrictions) in an aggregate amount which, together with
all other such secured Debt of the Company and its Subsidiaries (that is, not
including secured Debt of the Company and its Subsidiaries permitted pursuant
to the preceding paragraph) does not at any time exceed 10% of Consolidated
Net Tangible Assets of the Company. (Section 4.5(b))
The term "Principal Property" of any Person means, at any date
of determination, (a) any line or segment of track, together with signaling or
communication systems appurtenant thereto, owned by such Person as of such
date of determination over which at least 10 million gross tons of revenue
freight moved in the calendar year next preceding such date of determination;
(b) all locomotives and freight cars owned by such Person as of such date of
determination; (c) all freight yards and repair facilities owned by such
Person as of such date of determination; and (d) all real estate related to
the property described in (a), (b) or (c) owned by such Person as of such date
of determination. (Section 1.1)
The term "Consolidated Net Tangible Assets" with respect to any
Person means, as at any date of determination, the total amount of assets
(less applicable reserves and other properly deductible items) of such Person
and its Subsidiaries determined on a consolidated basis in conformity with
GAAP and set forth on the most recent consolidated balance sheet of such
Person and its Subsidiaries preceding such date of determination after
deducting therefrom (i) all current liabilities (excluding any thereof which
are by their terms extendible or renewable at the option of the obligor
thereon to a time more than 12 months after such date of determination), (ii)
all goodwill, trade names, trademarks, patents, unamortized debt discount and
expense and other like intangibles, and (iii) appropriate adjustments on
account of minority interests of other persons holding stock in the
Subsidiaries, all as determined on a consolidated basis in conformity with
GAAP and set forth on such most recent consolidated balance sheet of such
Person and its Subsidiaries. (Section 1.1)
Modification of the Indenture
The Indenture contains provisions permitting the Company and
the Trustee to enter into one or more supplemental indentures without the
consent of the Holders of Securities in order (i) to evidence the succession
of another corporation to the Company and the assumption of the covenants of
the Company by such successor, (ii) to comply with any requirements of the
Commission in connection with the qualification of the Indenture under the
Trust Indenture Act of 1939 as then in effect, (iii) to provide for a
successor Trustee with respect to the Securities of all or any series, (iv)
to establish the forms and terms of the Securities of any series, (v) to
provide for uncertificated or Unregistered Securities, or (vi) to cure any
ambiguity or correct any mistake or to make any change that does not materially
adversely affect the legal rights of any Holder of the Securities under such
Indenture. (Section 9.1)
The Indenture also contains provisions permitting the Company
and the Trustee, with the consent of the Holders of a majority in aggregate
principal amount of the then outstanding Securities of any series, to execute
supplemental indentures adding any provisions to or changing or eliminating
any of the provisions of the Indenture or any supplemental indenture or
modifying the rights of the Holders of such Securities, except that no such
supplemental indenture, or any amendment or waiver, may, without the consent
of the Holder of each Security, (i) extend the stated maturity of the
principal of, or any sinking fund obligation or any installment of interest
on, such Holder's Security, or reduce the principal amount thereof or the rate
of interest thereon (including any amount in respect of original issue
discount), or any premium payable with respect thereto, or adversely affect
the rights of such Holder under any mandatory redemption or repurchase
provision or any right of redemption or repurchase at the option of the Company
or such Holder, or reduce the amount of the principal of an Original Issue
Discount Security that would be due and payable upon an acceleration of the
maturity thereof or the amount thereof provable in bankruptcy, or change any
place of payment where, or the currency in which, any Security or any premium
or the interest thereon is payable, or impair the right to institute suit for
the enforcement of any such payment on or after the due date therefor, or
change the manner of determining any of the foregoing; (ii) reduce the
percentage in principal amount of outstanding Securities of the relevant
series the consent of whose Holders is required for any such supplemental
indenture, for any waiver of compliance with certain provisions of this
Indenture or certain Defaults and their consequences provided for in this
Indenture; (iii) waive a Default in the payment of principal of or interest
on any Security of such Holder; (iv) change any obligation of the Company to
maintain an office or agency in the places and for the purposes in the
Indenture provided; or (v) modify any of the foregoing provisions, except to
increase any such percentage or to provide that certain other provisions of
the Indenture cannot be modified or waived without the consent of the Holder
of each outstanding Security affected thereby. (Section 9.2) After a
supplemental indenture, amendment or waiver becomes effective, the Company
shall mail a notice to the Holders of the Securities affected thereby briefly
describing the supplemental indenture, amendment or waiver. (Section 9.2)
Defeasance and Covenant Defeasance
The Company may elect either (1) to defease and be discharged
from any and all obligations with respect to (a) Securities of any series
payable within one year or (b) other Securities of any series upon certain
additional conditions described below (except as otherwise provided in the
Indenture) ("defeasance") or (2) to be released from its obligations with
respect to certain covenants applicable to the Securities of any series
("covenant defeasance"), upon the deposit with the Trustee, in trust for such
purpose, of money and/or U.S. Government Obligations which through the payment
of principal and interest in accordance with their terms will provide money in
an amount sufficient without reinvestment to pay the principal of and interest
on the Securities and the satisfaction of certain other conditions set forth
in the Indenture. As a condition to defeasance of any Securities of any
series payable later than one year from the time of defeasance, the Company
must deliver to the Trustee an Opinion of Counsel or a ruling of the Internal
Revenue Service to the effect that the Holders of the Securities will not
recognize income, gain or loss for Federal income tax purposes as a result of
such defeasance and will be subject to Federal income tax on the same amount
and in the same manner and at the same times as would have been the case if
such defeasance or covenant defeasance had not occurred. (Article 8)
The Company may exercise either defeasance option with respect
to the Securities of any series notwithstanding its prior exercise of its
covenant defeasance option with respect thereto. If the Company exercises its
defeasance option, payment of the Securities of any series may not be
accelerated because of a Default or an Event of Default. If the Company
exercises its covenant defeasance option, payment of the Securities of any
series may not be accelerated by reason of an Event of Default with respect to
the covenants to which such covenant defeasance is applicable. If such
acceleration were to occur by reason of another Event of Default, the
realizable value at the acceleration date of the money and U.S. Government
Obligations in the defeasance trust could be less than the principal and
interest then due on the Securities, in that the required deposit in the
defeasance trust is based upon scheduled cash flow rather than market value,
which will vary depending upon interest rates and other factors. The Company
will, however, remain liable for such payments at the time of the acceleration.
Delivery and Form; Book-Entry Procedures
Book-Entry; Delivery and Form
The certificates representing the Exchange Debentures will be
issued in fully registered form and may, if agreed by the Company and the
Holder, be issued in the form of a permanent global certificate in fully
registered form (the "Global Debenture") and will be deposited with the
Trustee as custodian for The Depositary Trust Company (the "Depositary") and
registered in the name of Cede & Co., as nominee of the Depositary.
So long as the Depositary, or its nominee, is the registered
owner or holder of the Global Debenture, the Depositary or such nominee, as
the case may be, will be considered the sole owner or holder of the Exchange
Debentures represented by such Global Debenture for all purposes under the
Indenture and the Exchange Debentures. No beneficial owner of an interest in
the Global Debenture will be able to transfer that interest except in
accordance with the Depositary's applicable procedures, in addition to those
provided for under the Indenture.
The Depositary is a limited-purpose trust company that was
created to hold securities for its participating organizations (collectively,
the "Participants" or the "Depositary's Participants") and to facilitate the
clearance and settlement of transactions in such securities between
Participants through electronic computerized book-entry changes in accounts of
its Participants. The Depositary's Participants include securities brokers
and dealers (including the Initial Purchasers), banks and trust companies,
clearing corporations and certain other organizations. Access to the
Depositary's system is also available to other entities such as banks,
brokers, dealers and trust companies (collectively, the "Depositary's Indirect
Participants") that clear through or maintain a custodial relationship with a
Participant, either directly or indirectly. Persons who are not Participants
may beneficially own securities held by or on behalf of the Depositary only
through the Depositary's Participants or the Depositary's Indirect
Participants.
The Company expects that pursuant to procedures established by
the Depositary (i) upon deposit of the Global Debenture, the Depositary will
credit the accounts of participants with portions of the principal amount of
the Global Debenture and (ii) ownership of the Exchange Debentures evidenced
by the Global Debenture will be shown on, and the transfer of ownership
thereof will be effected on thought, records maintained by the Depositary
(with respect to the interests of the Depositary's participants, the
Depositary's Participants and the Depositary's Indirect Participants. The
Depositary's records reflect only the identity of the participants to whose
accounts portions of the principal amount of the Global Debenture are
credited, which may or may not be the beneficial owners of such interest in
the Global Debenture. Prospective purchasers are advised that the laws of
some states require that certain persons take physical delivery in definitive
form of securities that they own. Consequently, the ability to transfer
Exchange Debentures evidenced by the Global Debenture will be limited to such
extent.
Except as described below, owners of interest in the Global
Debenture will not have Debentures registered in their names, will not receive
physical delivery of Exchange Debentures in definitive form and will not be
considered the registered owners or holders thereof under the Indenture for
any purpose. The deposit of the Global Debenture with the Depositary and its
registration in the name of Cede & Co. effects no change in the beneficial
owners of interests in Global Debenture.
Payments of the principal of, premium (if any) and interest on,
the Global Debenture will be made to the Depositary or its nominee, as the
case may be, as the registered owner thereof. Neither the Company, the
Trustee nor any Paying Agent will have any responsibility or liability for any
aspect of the record relating to or payments made on account of beneficial
ownership interests in the Global Debenture or for maintaining, supervising or
reviewing any record relating to such beneficial ownership interest. The
Company believes, however, that it is currently the policy of the Depositary
to immediately credit the accounts of the relevant Participants with such
payments, in amounts proportionate to their respective holdings of beneficial
interest in the relevant security as shown on the records of the Depositary.
Payments by the Depositary's Participants and the Depositary's Indirect
Participants to the beneficial owners of the Debentures will be governed by
standing instructions and customary practice and will be the responsibility of
the Depositary's Participants or the Depositary's Indirect Participants.
The Depositary has advised the Company that it will take any
action permitted to be taken by a holder of Exchange Debentures (including the
presentation of Exchange Debentures for exchange as described below) only at
the direction of one or more Participants to whose account the Depositary
interest in the Global Debenture is credited and only in respect of such
portion of the aggregate principal amount of Exchange Debentures as to which
such participant or participants has or have given such direction. However,
if there is an Event of default under the Exchange Debentures or the
Indenture, the Depositary will exchange the Global Debenture for Exchange
Debentures in definitive form, which it will distribute to its Participants.
Although the Depositary customarily agrees to the foregoing
procedures in order to facilitate transfers of interests in global debentures
among participants of the Depositary, it is under no obligation to perform
such procedures, and such procedures may be discontinued at any time. Neither
the Company nor the Trustee will have any responsibility for the performance
by the Depositary or its participants or indirect participants of their
respective obligations under the rules and procedures governing their
operations.
Certificated Securities. If the Depositary is at any time
unwilling or unable to continue as a depository for the Global Debenture and a
successor depository is not appointed by the Company within 90 days, Exchange
Debentures in definitive form will be issued in exchange for the Global
Debenture.
Same-Day Settlement and Payment
The Indenture will require that payments in respect of the
Debentures represented by the Global Debenture (including principal, premium,
if any, interest and Liquidated Damages, if any) be made by wire transfer of
immediately available funds to the accounts specified by the Global
Debentureholder. The Debentures represented by the Global Debenture are
expected to trade in the Depositary's Same-Day Funds Settlement System, and
any permitted secondary market trading activity in such Debentures will,
therefore, be required by the Depositary to be settled in immediately
available funds.
Governing Law
The Indenture and the Debentures are governed by and construed
in accordance with the laws of the State of New York.
ORIGINAL DEBENTURES REGISTRATION RIGHTS
The Company and the Initial Purchasers entered into the
Registration Rights Agreement dated as of December 17, 1996 pursuant to which
the Company agreed, for the benefit of the holders of the Original Debentures,
at the Company's cost , (i) within 90 days after the Issue Date, to file this
Exchange Offer Registration Statement pursuant to which the Original
Debentures will be exchanged for the Exchange Debentures, which will have the
terms substantially similar to the Original Debentures (except that the
Exchange Debentures will not contain terms with respect to transfer
restrictions), and (ii) to cause this Exchange Offer Registration Statement to
be declared effective under the Securities Act within 180 days after the Issue
Date. Upon this Exchange Offer Registration Statement being declared
effective, the Company will offer the Exchange Debentures in exchange for
surrender of the Original Debentures. The Company agreed to keep the Exchange
Offer open for 20 business days (or longer if required by applicable law)
after the date notice of the Exchange Offer is mailed to the holders of the
Original Debentures. For each Original Debenture surrendered to the Company
pursuant to the Exchange Offer, the holder of such Original Debenture will
receive an Exchange Debenture having a principal amount equal to that of the
surrendered Original Debenture. Interest on each Exchange Debenture will
accrue from (i) the last interest payment date on which interest was paid on
the Original Debenture surrendered in exchange therefor or (ii) if no interest
has been paid on the Original Debenture, from the date of original issuance of
the Original Debentures. See "The Exchange Offer."
In the event that (i) the Company determines in reasonably good
faith that (x) any changes in the law or the applicable interpretations of the
Staff of the Commission do not permit the Company to effect the Exchange
Offer, or (y) that the Exchange Debentures would not be tradeable upon receipt
by the Holders that participate in the Exchange Offer without restriction
under state and federal securities laws (other than due solely to the status
of a Holder as an Affiliate of the Company), (ii) the Exchange Offer is not
consummated within 210 days of the Issue Date, (iii) in certain circumstances,
certain holders of unregistered Exchange Debentures so request within 180 days
after the consummation of the Exchange Offer or (iv) in the case of any holder
of Original Debentures that participates in the Exchange Offer, such holder of
Original Debentures does not receive Exchange Debentures on the date of the
exchange that may be sold without restriction under state and federal
securities laws (other than due solely to the status of such holder of Original
Debentures as an affiliate of the Company) and so notifies the Company within
60 days after such holder of Original Debentures first becomes aware of such
restriction and provides the Company with a reasonable basis for its
conclusion, in the case of each of clauses (i)-(iv) of this sentence, then the
company will promptly deliver to the holders of Original Debentures and the
Trustee written notice thereof and, at its cost, (a) as promptly as
practicable, file the Shelf Registration Statement, (b) use all reasonable
efforts to cause the Shelf Registration Statement to be declared effective
under the Securities Act by the 210th day after the Issue Date and (c) use all
reasonable efforts to keep the Shelf Registration Statement effective until
three years after its effective date, or such shorter period ending when (i)
all Original Debentures covered by the Shelf Registration Statement have been
sold in the manner set forth and as contemplated therein or (ii) a subsequent
Shelf Registration Statement covering all unregistered Original Debentures has
been declared effective under the Securities Act. The Company will, in the
event of the filing of the Shelf Registration Statement, provide to each
holder of the Original Debentures copies of the prospectus which is a part of
the Shelf Registration Statement, notify each such holder when the Shelf
Registration Statement for the Original Debentures has become effective and
take certain other actions as are required to permit unrestricted resales of
the Original Debentures. A holder of Original Debentures that sells such
Original Debentures pursuant to the Shelf Registration Statement generally
will be required to be named as a selling securityholder in the related
prospectus and to deliver a prospectus to purchasers, will be subject to
certain of the civil liability provisions under the Securities Act in
connection with such sales and will be bound by the provisions of the
Registration Rights Agreement which are applicable to such a holder (including
certain indemnification obligations). In addition, each holder of the Original
Debentures will be required to deliver information to be used in connection
with the Shelf Registration Statement and to provide comments on the Shelf
Registration Statement within the time periods set forth in the Registration
Rights Agreement in order to have its Original Debentures included in the
Shelf Registration Statement and to benefit from the provisions regarding
liquidated damages set forth in the following paragraph.
In the event that either (i) the Exchange Offer Registration
Statement is not filed with the Commission on or prior to the 90th calendar
day following the Issue Date, (ii) the Exchange Offer Registration Statement
is not declared effective on or prior to the 180th calendar day following the
Issue Date or (iii) the Exchange Offer is not consummated or the Shelf
Registration Statement is not declared effective on or prior to the 210th
calendar day following the Issue Date or the Shelf Registration Statement
ceases to be effective (each such event referred to in clauses (i) through
(iii), a "Registration Default"), then the Company will be required to pay to
each holder of Original Debentures accruing from the date of the first such
Registration Default (or if such Registration Default has been cured, from the
date of the next Registration Default), to the date such Registration Default
has been cured. Liquidated damages ("Liquidated Damages") at a rate per annum
equal to 0.5% of the principal amount of the Debentures held by such Holder.
All accrued Liquidated Damages will be paid by the Company on each interest
payment date to the Global Debenture Holder by wire transfer of same day funds
and to holders of Certificated Securities by wire transfer to the accounts
specified by them or by mailing checks to their registered addresses if no
such accounts have been specified. Following the cure of all Registration
Defaults, the accrual of Liquidated Damages shall cease.
The summary herein of certain provision of the Registration
Rights Agreement does not purport to be complete and is subject to, and is
qualified in its entirety by reference to, all the provisions of the
Registration Rights Agreement, a copy of which has been filed as an exhibit to
the Registration Statement of which this Prospectus is a part.
PLAN OF DISTRIBUTION
Based on interpretations by the Staff set forth in no-action
letters issued to third parties, the Company believes that Exchange Debentures
issued pursuant to the Exchange Offer in exchange for the Original Debentures
may be offered for resale, resold and otherwise transferred by holders thereof
(other than any holder which is (i) an Affiliate of the Company, (ii) a
broker-dealer who acquired Original Debentures directly from the Company or
(iii) a broker-dealer who acquired Original Debentures as a result of
market making or other trading activities) without compliance with the
registration and prospectus delivery provisions of the Securities Act
provided that such Exchange Debentures are acquired in the ordinary course
of such holders' business, and such holders are not engaged in, and do not
intend to engage in, and have no arrangement or understanding with any
person to participate in, a distribution of such Exchange Debentures;
provided that broker-dealers ("Participant Broker-Dealers") receiving
Exchange Debentures in the Exchange Offer will be subject to a prospectus
delivery requirement with respect to resales of such Exchange Debentures.
To date, the Staff has taken the position that Participating Broker-Dealers
may fulfill their prospectus delivery requirements with respect to
transactions involving an exchange of securities such as the exchange
pursuant to the Exchange Offer (other than a resale of an unsold allotment
from the sale of the Original Debentures to the Initial Purchasers, or a
Participating Broker-Dealer who acquires Exchange Debentures directly from
the Company other than as a result of market-making activity or ordinary
trading activities) with the prospectus contained in the Exchange Offer
Registration Statement. Pursuant to the Registration Rights Agreement, the
Company has agreed to permit Participating Broker-Dealers and other
persons, if any, subject to similar prospectus delivery requirements to use
this Prospectus in connection with the resale of such Exchange Debentures.
The Company has agreed that, for a period of 120 days after the Exchange
Date, it will make this Prospectus, and any amendment or supplement to this
Prospectus, available to any broker-dealer that requests such documents in
the Letter of Transmittal. However, Participating Broker-Dealers who
acquired Debentures directly from the Company other than as a result of
market-making activities or ordinary trading activities may not fulfill
their Prospectus delivery requirements with this Prospectus, but must
comply with the registration and prospectus delivery requirements of the
Securities Act.
Each holder of the Original Debentures who wishes to exchange
its Original Debentures for Exchange Debentures in the Exchange Offer will be
required to make certain representation to the Company as set forth in "The
Exchange Offer--Terms and Conditions of the Letter of Transmittal." In
addition, each holder who is a broker-dealer and who receives Exchange
Debentures for its own account in exchange for Original Debentures that were
acquired by it as a result of market making activities or other trading
activities, will be required to acknowledge that it will deliver a prospectus
in connection with any resale by it of such Exchange Debentures.
The company will not receive any proceeds from any sale of
Exchange Debentures by broker-dealers. Exchange Debentures received by
broker-dealers for their own account pursuant to the Exchange Offer may be
sold from time to time in one or more transactions in the over-the-counter
market, in negotiated transactions, through the writing options on the
Exchange Debentures or a combination of such methods of resale, at market
prices prevailing at the time of resale, at prices related to such prevailing
market prices or at negotiated prices. Any such resale may be made directly
to purchasers or to or through brokers or dealers who may receive compensation
in the form of commissions or concessions from any such broker-dealer and/or
the purchasers of any such Exchange Debentures. Any broker-dealer that
resells Exchange Debentures that were received by it for its own account
pursuant to the Exchange Offer and any broker or dealer that participates
in a distribution of such Exchange Debentures may be deemed to be an
"underwriter" within the meaning of the Securities Act and any profit on
any such resale of Exchange Debentures and any commissions or concessions
received by any such persons may be deemed to be underwriting compensation
under the Securities Act. The Letter of Transmittal states that by
acknowledging that it will deliver and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter"
within the meaning of the Securities Act.
The Company has agreed to pay all expenses incidental to the
Exchange Offer other than commissions and concessions of any brokers or
dealers and will indemnify holders of the Debentures (including any
broker-dealers) against certain liabilities, including liabilities under the
Securities Act, as set forth in the Registration Rights Agreement.
LEGAL MATTERS
Certain legal matters with respect to the validity of the
Exchange Debentures will be passed upon for the Company by Davis Polk &
Wardwell, New York, New York.
EXPERTS
The audited consolidated financial statements and financial
statement schedule incorporated by reference in this Prospectus and
Registration Statement have been audited by Arthur Andersen LLP, independent
public accountants, as indicated in their report with respect thereto, which
is incorporated by reference herein, and is incorporated herein in reliance
upon the authority of said firm as experts in accounting and auditing in
giving said report.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 20. 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
the unlawful payment of dividends or unlawful stock purchases or redemptions)
or (iv) for any transaction from which a director derived an improper personal
benefit. Section 145 of the DGCL empowers the Company to indemnify, subject
to the standards set forth therein, any person in connection with any action,
suit or proceeding brought before or threatened by reason of the fact that the
person was a director, officer, employee or agent of such company, or is or
was serving as such with respect to another entity at the request of such
company. The DGCL also provides that the Company may purchase insurance on
behalf of any such director, officer, employee or agent.
Article Tenth ("Article Tenth") of the Company's Certificate
of Incorporation (the "Certificate") limits the scope of personal liability of
the Company's directors to the Company or its stockholders for monetary
damages for breach of fiduciary duty as a director. In addition, Article VI
of the By-Laws of the Company ("Article VI") defines the rights of Company
directors and officers to indemnification by the Company in the event of
personal liability or expenses incurred by them as a result of certain
litigation against them. Set forth below are descriptions of Article Tenth and
Article VI.
Elimination of Liability in Certain Circumstances
Article Tenth protects the directors against personal liability
for breaches of their duty of care. Such Article absolves directors of
liability for negligence in the performance of their duties, including gross
negligence. Directors continue to remain liable for breaches of their duty of
loyalty to the Company and its stockholders as well as for acts or omissions
not in good faith or which involve intentional misconduct or a knowing
violation of law and transactions from which a director derived improper
personal benefit. In addition, Article Tenth does not absolve directors liable
for unlawful dividends or stock repurchases or redemptions to which an express
negligence standard presently applies under the Delaware General Corporation
Law (the "Delaware Law"). Also, there may be certain liabilities, such as
those under the federal securities laws or other state or federal laws, which
a court may hold are unaffected by Article Tenth.
Article Tenth further provides that if the Delaware Law is
hereafter amended to further eliminate or limit the liability of directors,
then the liability of a director of the Company shall be eliminated or
limited, without further stockholder action, to the fullest extent permitted
by the Delaware Law as so amended.
Although Article Tenth provides directors with protection
against personal liability for monetary damages for breaches of the duty of
care, it does not eliminate the directors' duty of care. Accordingly, Article
Tenth would have no effect on the availability of equitable remedies such as
an injunction to stop a proposed action or recision of a contract based upon a
director's breach of the duty of care.
Although both directors and officers of the Company are covered
by indemnification provisions under Article VI (see below), Article Tenth
limits liability only with respect to a person acting in the capacity of a
director.
Indemnification and Insurance
Article VI provides that the Company shall indemnify and hold
harmless each person who was or is made a party to, or is involved in, any
action, suit or proceeding by reason of the fact that such person is or was a
director or officer of the Company (or was serving at the request of the
Company as a director, officer, employee or agent for another entity,
including service with respect to employee benefit plans of the Company) while
serving in such capacity, to the fullest extent permitted or allowed by
Delaware Law, as in effect (or, to the extent indemnification is broadened, as
it may be amended) against all expense, liability and loss (including
attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts
to be paid in settlement) reasonably incurred by such person in connection
therewith. Article VI provides that the right conferred thereby shall be a
contract right and shall include the right to be paid by the Company for the
expenses incurred in defending the proceedings specified above, in advance of
their final disposition, provided that, if the Delaware Law so requires, such
payment, in the case of a director or officer in his or her capacity as such,
shall only be made upon delivery to the Company by the indemnified party of an
undertaking to repay all amounts so advanced if it shall ultimately be
determined that the person receiving such payments is not entitled to be
indemnified under such provision or otherwise. Article VI provides that the
Company may, by action of its Board of Directors, provide indemnification to
its employees and agents with the same scope and effect as the foregoing
indemnification of directors and officers.
Article VI provides that persons indemnified thereunder may
bring suit against the Company to recover unpaid amounts claimed thereunder,
and that if such suit is successful, the expense of bringing such a suit shall
be reimbursed by the Company. Article VI further provides that while it is a
defense to such a suit that the person claiming the indemnification has not
met the standard of conduct making indemnification permissible under the
Delaware Law, the burden of proving the defense shall be on the Company and
neither the failure of the Company to have made a determination that
indemnification is proper, nor an actual determination that the claimant has
not met the applicable standard of conduct shall be a defense to the action or
create a presumption that the claimant has not met the applicable standard of
conduct.
Article VI provides that the right to indemnification and the
payment of expenses incurred in defending a proceeding in advance of its final
disposition conferred therein shall not be exclusive of any other right which
any person may have or acquire under any statute, provision of the Company's
Certificate or By-Laws, or otherwise. Finally, Article VI provides that the
Company may maintain insurance, at its expense, to protect itself and any of
its directors, officers, employees or agents against any expense, liability or
loss, whether or not the Company would have the power to indemnify such person
against such expenses, liability or loss under the Delaware Law. The Company
expects to purchase insurance on behalf of directors, officers and other
persons which may cover certain such expenses, liability or loss.
Item 21. Exhibits and Financial Statement Schedules
(a) Exhibits
Exhibits Description
- -------- -----------
4.1 Indenture dated as of July 25 , 1996 (the "Indenture") between
Illinois Central Railroad Company and The Chase Manhattan Bank,
as Trustee.(1)
4.2 First Supplemental Indenture dated as of December 17, 1996 between
Illinois Central Railroad Company and The Chase Manhattan Bank, as
Trustee.
4.3 Registration Rights Agreement dated as of December 10, 1996 among
Illinois Central Railroad Company, Lehman Brothers Inc. and Merrill
Lynch, Pierce, Fenner & Smith Incorporated.
5 Opinion of Davis Polk & Wardwell (legality opinion).*
12 Statement regarding Computation of Ratio of Earnings to Fixed Changes.
23.1 Consent of Arthur Andersen LLP relating to the financial statements
of Illinois Central Railroad Company.
23.2 Consent of Arthur Andersen LLP relating to the financial statements
of CCP Holdings, Inc.
23.3 Consent of Davis Polk & Wardwell (included in Exhibit 5).
25 Statement of eligibility and qualification on Form T-1 of The Chase
Manhattan Bank.
99.1 Form of Letter of Transmittal.*
99.2 Form of Notice of Guaranteed Delivery.*
99.3 Form of Letter to Clients.*
99.4 Form of Letter to Nominees.*
- ------------
* To be filed by amendment.
(1) Incorporated herein by reference to the Company's Registration Statement
on Form S-3, filed on May 15, 1996 (SEC File No. 333-03825).
(b) Financial Statement Schedule:
Incorporated herein by reference to the Company's Annual Report
on Form 10-K for the year ended December 31, 1995.
Item 22. Undertakings.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of Registrant pursuant to the provisions, the foregoing provisions
described under Item 20 above, or otherwise, the Registrant has been advised
that in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the 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, the 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
Securities Act and will be governed by the final adjudication of such issue.
The undersigned registrant hereby undertakes to respond to
requests for information that is incorporated by reference into this
Prospectus pursuant to Item 4, 10(b), 11 or 13 of Form S-4 of the Securities
Act, within one business day of receipt of such request, and to send the
incorporated documents by first class mail or other equally prompt means.
This includes information contained in documents filed subsequent to the
effective date of this Registration Statement through the date of responding
to the request.
The undersigned registrant hereby undertakes to supply by means
of a post-effective amendment all information concerning a transaction, and
the company being acquired involved therein, that was not the subject of and
included in the registration statement when it became effective.
The undersigned registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933, each filing of
the registrant's annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in The
City of Chicago, State of Illinois, on December 18, 1996.
ILLINOIS CENTRAL RAILROAD COMPANY
/s/ Dale W. Phillips
--------------------------------
By: Dale W. Phillips
Title: Vice President and Chief
Financial Officer
POWER OF ATTORNEY
The Registrant and each person whose signature appears below
constitutes and appoints E. Hunter Harrison, Ronald A. Lane and Dale W.
Phillips, and any agent for service named in this Registration Statement and
each of them, his, her or its true and lawful attorneys-in-fact and agents,
with full power of substitution and resubstitution, for him, her or it and in
his, her, or its name, place and stead, in any and all capacities, to sign any
and all amendments (including post-effective amendments) to this Registration
Statement, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully to all
intents and purposes as he, she, or it might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents or any of
them, or their or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Gilbert H. Lamphere Chairman of the Board, December 18, 1996
- ---------------------------- Director
Gilbert H. Lamphere
/s/ E. Hunter Harrison President and Chief December 18, 1996
- ---------------------------- Executive Officer
E. Hunter Harrison (principal executive
officer), Director
/s/ Dale W. Phillips Vice President and December 18, 1996
- ---------------------------- Chief Financial
Dale W. Phillips Officer(principal
financial officer),
Director
/s/ John V. Mulvaney Controller (principal December 18, 1996
- ---------------------------- accounting officer)
John V. Mulvaney
/s/ Ronald A. Lane Director December 18, 1996
- ----------------------------
Ronald A. Lane
/s/ John D. McPherson Director December 18, 1996
- ----------------------------
John D. McPherson
/s/ Donald H. Skelton Director December 18, 1996
- ----------------------------
Donald H. Skelton
EXHIBIT INDEX
Exhibits Description
- -------- -----------
4.1 Indenture dated as of July 25 , 1996 (the "Indenture")
between Illinois Central Railroad Company and The Chase Manhattan
Bank, as Trustee.(1)
4.2 First Supplemental Indenture dated as of December 17, 1996 between
Illinois Central Railroad Company and The Chase Manhattan Bank,
as Trustee.
4.3 Registration Rights Agreement dated as of December 10, 1996 among
Illinois Central Railroad Company, Lehman Brothers Inc. and
Merrill Lynch, Pierce, Fenner & Smith Incorporated.
5 Opinion of Davis Polk & Wardwell (legality opinion).*
12 Statement regarding Computation of Ratio of Earnings to Fixed Charges.
23.1 Consent of Arthur Andersen LLP relating to the financial statements
of Illinois Central Railroad Company.
23.2 Consent of Arthur Andersen LLP relating to the financial statements
of CCP Holdings, Inc.
23.3 Consent of Davis Polk & Wardwell (included in Exhibit 5).*
25 Statement of eligibility and qualification on Form T-1 of The Chase
Manhattan Bank.
99.1 Form of Letter of Transmittal.*
99.2 Form of Notice of Guaranteed Delivery.*
99.3 Form of Letter to Clients.*
99.4 Form of Letter to Nominees.*
- ----------
* To be filed by amendment.
(1) Incorporated herein by reference to the Company's Registration Statement
on Form S-3, filed on May 15, 1996 (SEC File No. 333-03825).
Exhibit 4.2
=======================================
FIRST SUPPLEMENTAL INDENTURE
between
Illinois Central Railroad Company
and
The Chase Manhattan Bank
Dated as of December 17, 1996
========================================
FIRST SUPPLEMENTAL INDENTURE, dated as of December 17, 1996
(the "First Supplemental Indenture"), between Illinois Central Railroad
Company, a Delaware corporation (the "Company"), and The Chase Manhattan Bank,
as trustee (the "Trustee") under the Indenture dated as of July 25, 1996
between the Company and the Trustee (the "Base Indenture" and together with
this First Supplemental Indenture, the "Indenture").
WHEREAS, the Company executed and delivered the Base Indenture
to the Trustee to provide for the future issuance of the Company's unsecured
senior debt securities to be issued from time to time in one or more series as
might be determined by the Company under the Indenture, in an unlimited
aggregate principal amount which may be authenticated and delivered as
provided in the Base Indenture;
WHEREAS, Section 9.1(5) of the Base Indenture provides that,
without the consent of or notice to any Holder, the Company and the Trustee
may amend or supplement the Indenture to establish the form or forms or terms
of the Securities of any series pursuant to Section 2.3 thereof, and the
Company and the Trustee are entering into this Supplement Indenture to
establish the forms and terms of a series of Securities to be known as the
"7.70% Debentures due 2006" (the "Debentures"); and
WHEREAS, the Company has requested that the Trustee execute and
deliver this First Supplemental Indenture and all requirements necessary to
make this First Supplemental Indenture a valid instrument in accordance with
its terms, and to make the Debentures, when executed by the Company and
authenticated and delivered by the Trustee, the valid obligations of the
Company, have been performed, and the execution and delivery of this First
Supplemental Indenture has been duly authorized in all respects.
NOW THEREFORE, in consideration of the purchase and acceptance
of the Debentures by the Holders thereof, and for the purpose of setting
forth, as provided in the Base Indenture, the form and substance of the
Debentures and the terms, provisions and conditions thereof, the Company
covenants and agrees with the Trustee as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definition of Terms. For all purposes of the
First Supplemental Indenture, except as otherwise expressly provided or unless
the context otherwise requires:
(a) the terms which are defined in the Base Indenture have
the same meanings when used in this First Supplemental Indenture;
(b) the terms "Exchange Offer", "Exchange Offer Registration
Statement", "Liquidated Damages" and "Shelf Registration Statement", which are
defined in the Registration Rights Agreement, shall have the same meanings when
used in this First Supplement Indenture;
(c) all other terms used herein which are defined in the Trust
Indenture Act, whether directly or by reference therein, have the meanings
assigned to them therein; and
(d) a reference to a Section or Article is to a Section or
Article of this First Supplemental Indenture.
"Debenture" or "Debentures" means any 7.70% Debentures due 2096,
as the case may be, authenticated and delivered under the Indenture. For all
purposes of the Indenture, the term "Debentures" shall include any Original
Debentures and any Exchange Debentures or Restricted Exchange Debentures to be
issued and exchanged for any Original Debentures pursuant to the Registration
Rights Agreement and the Indenture and, for purposes of the Indenture, all
Original Debentures, Exchange Debentures and Restricted Exchange Debentures
shall be considered, and vote together as, one series of Securities under the
Indenture.
"Exchange Debentures" means any securities of the Company
containing terms identical to the Original Debentures (except that such
Exchange Debentures (i) shall be registered under the Securities Act and (ii)
shall have an interest rate equal to 7.70% per annum, without provision for
Liquidated Damages, except as provided in the Registration Rights Agreement).
The Exchange Debentures are to be issued in connection with the Exchange Offer
Registration Statement or the Shelf Registration Statement pursuant to the
Registration Rights Agreement and the Indenture. The Exchange Debentures
shall be substantially in the form attached hereto as Exhibit C.
"Initial Purchasers" means Lehman Brothers Inc. and Merrill
Lynch, Pierce, Fenner & Smith Incorporated, the initial purchasers of the
Original Debentures pursuant to a Purchase Agreement with the Company dated
December 12, 1996.
"Institutional Accredited Investor" shall mean an institution
that is an "accredited investor" as that term is defined in Rule 501(a)(1),
(2), (3) or (7) under the Securities Act.
"Offering Memorandum" means the Company's Offering Memorandum
dated December 12, 1996 with respect to the Original Debentures.
"Original Debentures" means the Restricted Global Debenture and
the Restricted Certificated Debentures.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of December 17, 1996, among the Company, Lehman Brothers
Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated.
"Restricted Certificated Debentures" has the meaning set forth
in Section 2.2 hereof.
"Restricted Exchange Debenture" has the meaning set forth in
Section 2.2 hereof.
"Restricted Global Debenture" has the meaning set forth in
Section 2.2 hereof.
"Restricted Debentures" means Debentures which are the
Restricted Global Debenture, the Restricted Certificated Debentures or the
Restricted Exchange Debentures bearing the Securities Legend.
"Rule 144A" means Rule 144A under the Securities Act.
"Securities Legend" means the legend set forth in Section
2.3(a) hereof.
ARTICLE II
ISSUE, EXECUTION, FORM AND
REGISTRATION OF DEBENTURES
SECTION 2.1. Principal Amount of Debentures; Issuance of
Exchange Debentures. Upon the execution and delivery of this First
Supplemental Indenture, or from time to time thereafter, Debentures in an
aggregate principal amount not in excess of $125,000,000 (including the
principal amount of any outstanding Original Debentures, Exchange Debentures
and Restricted Exchange Debentures) (except as otherwise provided in Sections
2.7, 2.8, 2.10, 3.2 or 9.4 of the Base Indenture or Section 2.4 hereof), may
be executed by the Company and delivered to the Trustee for authentication,
and the Trustee shall thereupon authenticate and deliver said Debentures to or
upon the written order of the Company as provided in the Base Indenture.
In the case of the original issuance of Exchange Debentures, the
Trustee shall be entitled to receive an Opinion of Counsel of the Company
dated the date thereof substantially to the effect that:
(a) The Exchange Debentures have been duly authorized and,
assuming due execution, authentication and delivery of the Exchange
Debentures to the Holders of the Debentures in exchange for the
Debentures in accordance with the provisions of the Indenture and
assuming due authentication by the Trustee, will constitute valid and
binding obligations of the Company entitled to the benefits of the
Indenture, enforceable in accordance with their terms, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles
(whether considered in a proceeding in equity or at law) or an implied
covenant of good faith and fair dealing.
(b) Except as required by the Securities Act, the Trust
Indenture Act or applicable state securities laws, no consent,
authorization or order of, or filing or registration with, any court
or governmental agency in the United States, which has not been made
or obtained, is required for the issuance of the Exchange Debentures
in exchange for the Debentures or the compliance with the provisions
of the Indenture and the Exchange Debentures.
(c) The issuance and delivery of the Exchange Debentures in
exchange for the Debentures and the compliance by the Company with the
provisions of the Indenture and the Exchange Debentures will not
conflict with, or result in the creation or imposition of any lien,
charge or encumbrance upon any of the assets of the Company or any of
its subsidiaries pursuant to the terms of, or constitute a default
under, any agreement, indenture or instrument binding upon the
Company and known to such counsel, or result in a violation of the
corporate charter or by-laws of the Company, or any law, rule or
regulation or, to such counsel's knowledge without independent
investigation, conflict with or result in the violation of any order
or determination of any arbitrator, court or governmental agency
having jurisdiction over the Company or any of the Company's
subsidiaries the effect of which would be material and adverse to the
Company and its subsidiaries taken as a whole.
(d) Such counsel has reviewed evidence that the Exchange Offer
Registration Statement or Shelf Registration Statement, as
applicable, relating to the Exchange Debentures has been declared
effective under the Securities Act and the Indenture qualified under
the Trust Indenture Act.
In connection with the initial issuance of Exchange Debentures,
the Company shall, within five (5) Business Days after filing of the Exchange
Offer Registration Statement or the Shelf Registration Statement, as
applicable, deliver a copy thereof to the Trustee. Upon the declaration of
effectiveness of the Exchange Offer Registration Statement or the Shelf
Registration Statement, as applicable, by the Commission, the Company shall,
within five (5) Business Days thereafter, deliver a notice of such declaration
of effectiveness to each holder, which may take the form of a copy of the
prospectus included in such Exchange Offer Registration Statement or Shelf
Registration Statement, and an Officers' Certificate to the Trustee stating
that such Exchange Offer Registration Statement or Shelf Registration
Statement, as applicable, has been declared effective by the Commission,
together with a copy of the order of effectiveness, when available. If a
Registered Global Debenture is to be issued in respect of the Exchange
Debentures, the Company shall execute and deliver a letter of representation
and other materials requested by the Depositary in connection with the initial
issuance of Exchange Debentures.
The Company and the Trustee may require, as a condition to the
issuance and authentication of any Exchange Debenture or Restricted Exchange
Debenture in exchange for an Original Debenture, such certificates, opinions
or other evidence, in form and substance reasonably satisfactory to the
Company and the Trustee, that the transfer or issuance of Exchange Debentures
or Restricted Exchange Debentures, as the case may be, will not violate
applicable interpretations of the Commission. Each Holder who wishes to
exchange Original Debentures for Exchange Debentures in the Exchange Offer
will be required to make certain representations, including that (i) it is not
an Affiliate of the Company, (ii) any Exchange Debentures to be received by it
were acquired in the ordinary course of its business and (iii) at the time of
consummation of the Exchange Offer, it has no arrangement or understanding
with any Person to participate in the distribution of the Exchange Debentures
in violation of the provisions of the Securities Act. Each Holder of
Restricted Exchange Debentures who wishes to transfer or exchange such
Restricted Exchange Debentures for Exchange Debentures pursuant to a Shelf
Registration Statement will be required to make certain representations set
forth in Exhibit F hereto.
SECTION 2.2. Form, Terms, Denomination and Date of Debentures;
Payments of Interest. The Debentures shall be substantially in the forms
attached hereto as Exhibits A, B, C and D, respectively, and shall have the
terms set forth therein, and the Certificate of Authentication of the Trustee
on each Debenture shall be substantially in the forms included in Exhibits A,
B, C and D. The Debentures shall be issuable as Registered Securities without
coupons and in denominations provided for in the forms of Debenture attached
hereto as Exhibits A, B, C and D, as applicable. The Debentures shall be
numbered, lettered, or otherwise distinguished in such manner or in accordance
with such plans as the officers of the Company executing the same may
determine with the approval of the Trustee.
Except as provided in the next paragraph, Original Debentures
offered and sold in reliance on Rule 144A shall be issued in the form of a
single Registered Global Security, substantially in the form set forth as
Exhibit A hereto (the "Restricted Global Debenture"), deposited on the date of
the closing of the sale of the Original Debentures with the Depositary, or
with the Trustee, as custodian for the Depositary, duly executed by the
Company and authenticated by the Trustee as hereinafter provided and
registered in the name of Cede & Co., as nominee of the Depositary. The
Restricted Global Debenture shall be subject to certain restrictions on
transfer set forth herein and in the Offering Memorandum. The aggregate
principal amount of the Restricted Global Debenture may from time to time be
increased or decreased by adjustments made on the books and records of the
Registrar and/or the Trustee, as custodian for the Depositary or its nominee,
as hereinafter provided.
Original Debentures offered and sold to Institutional Accredited
Investors shall be issued in the form of permanent certificated securities in
registered form in substantially the form set forth as Exhibit B hereto (the
"Restricted Certificated Debentures").
Exchange Debentures shall be issued substantially in the form
set forth in Exhibit C hereto. Exchange Debentures shall be issued in
registered form and, unless otherwise determined by the Company, shall be
issued in the form of Registered Global Securities. Any Exchange Debenture
issued in the form of a Registered Global Security shall be issued in a form
substantially identical to Exhibit C hereto (except that any such Registered
Global Security representing Exchange Debentures shall include on the face
thereof the legend set forth in Section 2.3(b)). The aggregate principal
amount of a Registered Global Security representing Exchange Debentures may
from time to time be increased or decreased by adjustments made on the records
of Registrar and/or the Trustee, as custodian for the Depositary or its
nominee.
Notwithstanding the foregoing, if, prior to consummation of the
Exchange Offer, any Initial Purchaser holds any Debentures acquired by it and
having, or which are reasonably likely to be determined to have, the status of
an unsold allotment in the initial distribution, or any other Holder is not
entitled to participate in the Exchange Offer, the Company upon the request of
the Initial Purchaser or any such Holder pursuant to the Registration Rights
Agreement shall simultaneously with the delivery of the Exchange Debentures in
the Exchange Offer, issue and deliver to the Initial Purchaser and any such
Holder, in exchange for such Original Debentures held by the Initial Purchaser
and any such Holder, a like principal amount of debt securities of the Company
that are identical in all material respects to the Exchange Debentures (except
for the inclusion of any such transfer restrictions that may, in the opinion
of counsel for the Company, be required under the Securities Act) (the
"Restricted Exchange Debentures"); provided, however, the Company shall not be
required to effect such exchange if, in the written opinion of counsel for the
Company (a copy of which shall be delivered to the Initial Purchasers and any
Holder affected thereby), such exchange cannot be effected without
registration under the Securities Act. Any Restricted Exchange Debentures
shall be issued in the form of permanent certificated securities in registered
form, substantially in the form set forth in Exhibit D hereto.
Any of the Debentures may be issued with appropriate insertions,
omissions, substitutions and variations, and may have imprinted or otherwise
reproduced thereon such legend or legends, not inconsistent with the
provisions of the Indenture, as may be required to comply with any law or with
any rules or regulations pursuant thereto, or with the rules of any securities
market in which the Debentures are admitted to trading, or to conform to
general usage. The Company shall furnish any such legends or endorsements to
the Trustee in writing. The Company shall approve the form of the Debentures
and any notation, legend or endorsement on them.
Each Debenture shall be dated the date of its authentication,
shall bear interest from the date stated therein and shall be payable on the
dates specified in the applicable form of Debenture.
The person in whose name any Debenture is registered at the
close of business on any record date (determined as provided in the applicable
form of Debenture) with respect to any interest payment date (determined as
provided in the applicable form of Debenture) shall be entitled to receive the
interest payable on such interest payment date notwithstanding any transfer or
exchange of such Debenture subsequent to the record date and prior to such
interest payment date, except if and to the extent the Company shall default
in the payment of the interest due on such interest payment date, in which
case such defaulted interest shall be paid to the persons in whose names
outstanding Debentures are registered at the close of business on a subsequent
special record date, determined as provided in Section 2.13 of the Base
Indenture. Notwithstanding the foregoing, interest on the Exchange Debentures
and the Restricted Exchange Debentures will accrue (A) from the last interest
payment date to which interest was paid on the Original Debentures surrendered
in exchange therefor or (B) if no interest has been paid on the Debentures,
from the original issue date of the Original Debentures. In addition, the
Company shall pay Liquidated Damages, if any, on such dates, in the amounts,
to the Persons, for the periods and on the other terms provided in the
Registration Rights Agreement and the forms of the Debentures.
SECTION 2.3. Restrictive Legends. (a) Unless and until an
Original Debenture is exchanged for an Exchange Debenture in connection with
an effective Exchange Offer Registration Statement or sold pursuant to the
Shelf Registration Statement in accordance with the Registration Rights
Agreement, or unless otherwise agreed by the Company and the Holder thereof,
each Restricted Debenture shall bear a legend on the face thereof in
substantially the following form:
THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), OR ANY STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT
BE OFFERED, SOLD OR OTHERWISE TRANSFERRED EXCEPT AS SET FORTH
IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE
HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR
(B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN
RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT)
("INSTITUTIONAL ACCREDITED INVESTOR"), (2) AGREES THAT IT WILL
NOT WITHIN THREE YEARS AFTER THE ORIGINAL ISSUANCE OF THE
SECURITY EVIDENCED HEREBY RESELL OR OTHERWISE TRANSFER THE
SECURITY EVIDENCED HEREBY, EXCEPT (A) TO ILLINOIS CENTRAL
RAILROAD COMPANY (THE "ISSUER"), (B) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH
RULE 144A UNDER THE SECURITIES ACT, (D) TO AN INSTITUTIONAL
ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO
THE TRUSTEE, A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS
AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THE
SECURITY EVIDENCED HEREBY (THE FORM OF WHICH LETTER CAN BE
OBTAINED FROM THE TRUSTEE), (E) PURSUANT TO OFFERS OR SALES
THAT OCCUR OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE
904 UNDER THE SECURITIES ACT, OR (F) PURSUANT TO ANY OTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE ISSUER'S AND THE TRUSTEE'S RIGHT
PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE
(D), (E) OR (F) TO REQUIRE THE DELIVERY TO THEM OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO
EACH OF THEM, AND (3) AGREES THAT IT WILL DELIVER TO EACH
PERSON TO WHOM THE SECURITY EVIDENCED HEREBY IS TRANSFERRED A
NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN
CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY
WITHIN THREE YEARS AFTER THE ORIGINAL ISSUANCE OF SUCH
SECURITY, THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH
ON THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER
AND SUBMIT THIS CERTIFICATE TO THE TRUSTEE, AS TRANSFER AGENT.
IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED
INVESTOR AND IN CERTAIN OTHER CASES NOTED ABOVE, THE HOLDER
MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE ISSUER AND THE
TRUSTEE, AS TRANSFER AGENT SUCH CERTIFICATIONS, LEGAL OPINIONS
OR OTHER INFORMATION AS THEY MAY REASONABLY REQUIRE TO CONFIRM
THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM,
OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE
REMOVED AFTER THE EXPIRATION OF THREE YEARS FROM THE ORIGINAL
ISSUANCE OF THE SECURITY EVIDENCED HEREBY. TRANSFERS OF THIS
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH
THE RESTRICTIONS SET FORTH IN SECTION 2.6 OF THE FIRST
SUPPLEMENTAL INDENTURE REFERRED TO HEREIN.
(b) The Restricted Global Debenture and any Exchange Debenture
which is a Registered Global Security shall also bear the following legend on
the face thereof:
UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC, (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, BY DTC TO A NOMINEE OF DTC
OR BY A NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC OR BY
DTC OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR NOMINEE
OF SUCH SUCCESSOR DEPOSITARY.
SECTION 2.4. Transfer and Exchange. When Debentures are
presented to the Registrar with a request to register the transfer or to
exchange them for an equal principal amount of Debentures of other authorized
denominations (including exchange of Original Debentures for Exchange
Debentures or Restricted Exchange Debentures), the Registrar shall register
the transfer or make the exchange as requested if the requirements set forth
in the Indenture for such transactions are met; provided that no exchanges of
Original Debentures for Exchange Debentures shall occur until an Exchange
Offer Registration Statement shall have been declared effective by the
Commission and provided, further, that any Original Debentures that are
exchanged for Exchange Debentures or Restricted Exchange Debentures shall be
cancelled by the Trustee.
All Debentures issued upon any transfer or exchange of
Debentures shall be valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the
Debentures surrendered upon such transfer or exchange.
SECTION 2.5. Global Debentures. (a) In connection with the
transfer of an entire Registered Global Security to beneficial owners, the
Registered Global Security shall be deemed to be surrendered to the Trustee
for cancellation, and the Company shall execute, and the Trustee shall
authenticate and deliver, to each beneficial owner identified by the
Depositary in exchange for its beneficial interest in the Registered Global
Security, an equal aggregate principal amount of definitive Debentures in
physical form (which Debentures shall be Restricted Certificated Debentures in
the case of a transfer of a beneficial interest in the Restricted Global
Debenture) and of authorized denominations.
(b) Any Restricted Certificated Debenture issued in exchange
for an interest in the Restricted Global Debenture shall, except as otherwise
provided by paragraph (e) of Section 2.6, bear the legend regarding transfer
restrictions applicable to the Restricted Certificated Debenture set forth in
Section 2.3(a).
SECTION 2.6. Special Transfer Provisions. Unless and until an
Original Debenture or Restricted Exchange Debenture is exchanged for an
Exchange Debenture in connection with an effective Exchange Offer Registration
Statement or sold pursuant to the Shelf Registration Statement in accordance
with the Registration Rights Agreement, the following provisions shall apply
to such Original Debenture or Restricted Exchange Debenture:
(a) Transfers to Non-QIB Institutional Accredited Investors.
The following provisions shall apply with respect to the registration
of any proposed transfer of such Debenture to any Institutional
Accredited Investor which is not a QIB:
(i) The Registrar shall register the transfer of such
Debenture, if (x) the requested transfer is at least three
years after the later of the original issue date of the
Debentures and the last date on which such Debenture was held
by an Affiliate of the Company or (y) the proposed transferee
has delivered to the Registrar a certificate substantially in
the form of the Institutional Accredited Investor Certificate
set forth in Exhibit E hereto.
(ii) If the proposed transferor is an agent member of
the Depositary (an "Agent Member"), holding a beneficial
interest in the Restricted Global Debenture, upon receipt by
the Registrar of (A) the documents, if any, required by clause
(y) of paragraph (i) of this Section 2.6(a) and (B)
instructions given in accordance with the Depositary's and the
Registrar's procedures, the Registrar, and/or the Trustee as
custodian for the Depositary or its nominee, shall reflect on
its or their books and records the date and a decrease in the
principal amount of the Restricted Global Debenture in an
amount equal to the principal amount of the beneficial interest
in the Restricted Global Debenture to be transferred, and the
Company shall execute, and the Trustee shall authenticate and
deliver, one or more Restricted Certificated Debentures of like
tenor and amount.
(b) Transfers to QIBs. The following provisions shall apply
with respect to the registration of any proposed transfer of such Debenture to
a QIB:
(i) Upon the transfer to a QIB of Restricted
Certificated Debentures initially issued to an Institutional
Accredited Investor, such Restricted Certificated Debentures
will, unless the Restricted Global Debenture has previously
been exchanged in whole for Restricted Certificated Debentures,
be exchanged for an interest in the Restricted Global
Debenture. If the Debenture to be transferred consists of
Restricted Certificated Debentures or Restricted Exchange
Debentures, the Registrar shall register the transfer if such
transfer is being made by a proposed transferor who has checked
the box provided for on the form of Debenture stating, or has
otherwise advised the Company and the Registrar in writing,
that the sale has been made in compliance with the provisions
of Rule 144A to a transferee who has signed the certification
provided for on the form of Debenture stating, or has otherwise
advised the Company and the Registrar in writing, that it is
purchasing the Debenture for its own account or an account with
respect to which it exercises sole investment discretion and
that each of it and any such account is a QIB within the
meaning of Rule 144A, and is aware that the sale to it or such
account is being made in reliance on Rule 144A and acknowledges
that it has received such information regarding the Company as
it has requested pursuant to Rule 144A or has determined not to
request such information and that it is aware that the
transferor is relying upon its foregoing representations in
order to claim the exemption from registration provided by Rule
144A.
(ii) If the proposed transferee is an Agent Member, and
the Debenture to be transferred consists of Restricted
Certificated Debentures, upon receipt by the Registrar of the
documents referred to in clause (i) and instructions given in
accordance with the Depositary's and the Registrar's
procedures, the Registrar, and/or the Trustee, as custodian for
the Depositary or its nominee, shall reflect on its or their
books and records the date and an increase in the principal
amount of the Restricted Global Debenture in an amount equal to
the principal amount of the Restricted Certificated Debenture
to be transferred, and the Trustee shall cancel the Restricted
Certificated Debenture.
(c) Exchange of Restricted Global Debenture, Restricted
Certificated Debentures or Restricted Exchange Debentures for Exchange
Debentures or Restricted Exchange Debentures. The following provisions shall
apply with respect to the registration of any proposed exchange of an interest
in the Restricted Global Debenture or a Restricted Certificated Debenture or
Restricted Exchange Debenture for an Exchange Debenture or a Restricted
Exchange Debenture, as applicable.
(i) If the proposed transferor is an Agent Member
holding a beneficial interest in the Restricted Global
Debenture, upon receipt of instructions given in accordance
with the Depositary's and the Registrar's procedures, the
Registrar, and/or the Trustee, as custodian for the Depositary
or its nominee, shall reflect on its books and records the date
and a decrease in the principal amount of the Restricted Global
Debenture in an amount equal to the principal amount of the
beneficial interest in the Restricted Global Debenture to be
transferred, and the Company shall execute, and the Trustee
shall authenticate and deliver, one or more Exchange Debentures
or Restricted Exchange Debentures, as applicable, of like tenor
and amount (including, without limitation, Exchange Debentures
in the form of one or more Registered Global Securities).
(ii) If the proposed transferor is a Holder of a
Restricted Certificated Debenture or Restricted Exchange
Debenture, the Registrar and/or the Trustee shall cancel such
Restricted Certificated Debenture or Restricted Exchange
Debenture on its books and records and the Company shall
execute, and the Trustee shall authenticate and deliver, one or
more Exchange Debentures or Restricted Exchange Debentures, as
applicable, of like tenor and amount (including, without
limitation, Exchange Debentures in the form of one or more
Registered Global Securities).
(d) Transfer and Exchange of Restricted Exchange Debentures.
The following additional provisions will apply with respect to the
registration of any proposed transfer or exchange of an interest in a
Restricted Exchange Debenture:
(i) If the Restricted Exchange Debenture is submitted
for registration of transfer (x) in connection with a change of
beneficial ownership other than that resulting from a sale or
other transfer for value pursuant to an effective Shelf
Registration Statement or (y) solely of record ownership not
involving the delivery of any consideration, upon receipt of
the Holder's transfer certification set forth on the reverse of
the Restricted Exchange Debenture, the Registrar and/or the
Trustee shall cancel such Restricted Exchange Debenture on its
books and records and the Company shall execute, and the
Trustee shall authenticate and deliver, one or more Restricted
Exchange Debentures of like tenor and amount.
(ii) If the Restricted Exchange Debenture is submitted
for registration of transfer in connection with a change of
beneficial ownership resulting from a sale or other transfer
for value pursuant to an effective Shelf Registration
Statement, upon receipt of the Restricted Exchange Debenture
Transfer Certificate set forth in Exhibit F hereto (or such
other documentation in form and substance satisfactory to the
Company and the Trustee), the Registrar and/or the Trustee shall
cancel such Restricted Exchange Debenture on its books and
records and the Company shall execute, and the Trustee shall
authenticate and deliver, one or more Exchange Debentures of
like tenor and amount.
(e) Securities Legend. Upon the transfer, exchange or
replacement of Restricted Debentures, the Registrar shall deliver only
Restricted Debentures (bearing the Securities Legend) unless either (i) the
transfer is at least three years after the later of the original issue date of
the Debentures and the last date on which such Debenture was held by an
Affiliate of the Company or (ii) there is delivered to the Registrar an
opinion of counsel reasonably satisfactory to the Company and the Registrar to
the effect that neither such legend nor the related restrictions on transfer
are required in order to maintain compliance with the provisions of the
Securities Act.
(f) Suspension of Effectiveness of Shelf Registration
Statement. Upon the issuance of a stop order or any other suspension of
effectiveness of the Shelf Registration Statement by the Commission, the
Company shall immediately deliver a notice of such suspension of effectiveness
to the Trustee and the Registrar, whereupon the Trustee shall cease to
authenticate and the Registrar shall cease to record the transfer of
additional Exchange Debentures being sold pursuant to such Shelf Registration
Statement until it shall have received an Officers' Certificate stating that
the Shelf Registration Statement, or a succeeding registration statement, has
again been declared effective by the Commission, together with a copy of the
order of effectiveness, when available. During the period of any suspension
of effectiveness of the Shelf Registration Statement, transfers of Restricted
Debentures shall be made only in accordance with an Exchange Offer
Registration Statement, if available, or pursuant to Section 2.6(a) or (b).
(g) General. By its acceptance of any Debenture bearing the
Securities Legend, each Holder of such a Debenture acknowledges the
restrictions on transfer of such Debenture set forth in this First
Supplemental Indenture and in the Securities Legend and agrees that it will
transfer such Debenture only as provided in this First Supplemental Indenture
and the Securities Legend. The Registrar shall not register a transfer of any
such Debenture unless such transfer complies with the restrictions on transfer
of such Debenture set forth in this First Supplemental Indenture and the
Securities Legend. In connection with any transfer of Debentures, each Holder
agrees by its acceptance of the Debentures to furnish the Registrar or the
Company such certifications, legal opinions or other information as either of
them may reasonably require to confirm that such transfer is being made
pursuant to an exemption from, or a transaction not subject to, the
registration requirements of the Securities Act, provided that the Registrar
shall not be required to determine (but may rely on a determination made by
the Company with respect to) the sufficiency of any such certifications, legal
opinions or other information.
The Registrar shall retain copies of all letters, notices and
other written communications received pursuant to Section 2.5 or this Section
2.6. The Company shall have the right to inspect and make copies of all such
letters, notices or other written communications at any reasonable time upon
the giving of reasonable written notice to the Registrar.
ARTICLE III
MISCELLANEOUS
SECTION 3.1. Ratification of Indenture. The Indenture, as
supplemented by this First Supplemental Indenture, is in all respects ratified
and confirmed, and this First Supplemental Indenture shall be deemed part of
the Indenture in the manner and to the extent herein and therein provided.
SECTION 3.2. Trustee Not Responsible for Recitals. The
recitals herein contained are made by the Company and not by the Trustee, and
the Trustee assumes no responsibility for the correctness thereof. The
Trustee makes no representation as to the validity or sufficiency of this
First Supplemental Indenture.
SECTION 3.3. Governing Law. This First Supplemental Indenture
and each Debenture shall be deemed to be a contract made under the internal
laws of the State of New York, and for all purposes shall be construed in
accordance with the laws of said State.
SECTION 3.4. Separability. In case any one or more of the
provisions contained in this First Supplemental Indenture or in the Debentures
shall for any reason be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision of this First Supplemental Indenture or of the Debentures, but
this First Supplemental Indenture and the Debentures shall be construed as if
such invalid or illegal or unenforceable provision had never been contained
herein or therein.
SECTION 3.5. Counterparts. This First Supplemental Indenture
may be executed in any number of counterparts each of which shall be an
original, but such counterparts shall together constitute but one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed as of the day and year first above
written.
ILLINOIS CENTRAL RAILROAD COMPANY
Attest:
/s/ K.A. McCarthy
- ----------------------
By: /s/ Dale W. Phillips
-----------------------------
Name: Dale W. Phillips
Title: Vice President and Chief
Financial Officer
THE CHASE MANHATTAN BANK,
Attest: as Trustee
/s/ Assistant Secretary
- -----------------------
By: /s/ R.J. Halleran
-----------------------------
Name: R.J. Halleran
Title: Second Vice President
Exhibit A
---------
[FORM OF RESTRICTED GLOBAL DEBENTURE]
[FORM OF FACE OF SECURITY]
THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS, AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED EXCEPT AS SET
FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED
INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES
ACT) ("INSTITUTIONAL ACCREDITED INVESTOR"), (2) AGREES THAT IT WILL NOT WITHIN
THREE YEARS AFTER THE ORIGINAL ISSUANCE OF THE SECURITY EVIDENCED HEREBY
RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY, EXCEPT (A) TO
ILLINOIS CENTRAL RAILROAD COMPANY (THE "ISSUER"), (B) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER
THE SECURITIES ACT, (D) TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO
SUCH TRANSFER, FURNISHES TO THE CHASE MANHATTAN BANK, AS TRUSTEE, A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH
LETTER CAN BE OBTAINED FROM THE TRUSTEE), (E) PURSUANT TO OFFERS OR SALES THAT
OCCUR OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 UNDER THE
SECURITIES ACT, OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER'S AND
THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSE (D), (E) OR (F) TO REQUIRE THE DELIVERY TO THEM OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM,
AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITY
EVIDENCED HEREBY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND. IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY
WITHIN THREE YEARS AFTER THE ORIGINAL ISSUANCE OF SUCH SECURITY, THE HOLDER
MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE
MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE CHASE MANHATTAN
BANK, AS TRANSFER AGENT. IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL
ACCREDITED INVESTOR AND IN CERTAIN OTHER CASES NOTED ABOVE, THE HOLDER MUST,
PRIOR TO SUCH TRANSFER, FURNISH TO THE ISSUER AND THE CHASE MANHATTAN BANK, AS
TRANSFER AGENT, SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS
THEY MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE
PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED
AFTER THE EXPIRATION OF THREE YEARS FROM THE ORIGINAL ISSUANCE OF THE SECURITY
EVIDENCED HEREBY. TRANSFERS OF THIS SECURITY SHALL BE LIMITED TO TRANSFERS
MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.6 OF THE FIRST
SUPPLEMENTAL INDENTURE REFERRED TO HEREIN.
UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, BY DTC TO A NOMINEE OF DTC OR BY A NOMINEE OF DTC TO DTC OR
ANOTHER NOMINEE OF DTC OR BY DTC OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY
OR NOMINEE OF SUCH SUCCESSOR DEPOSITARY.
CUSIP NO. 451866SVO
No. R1 $125,000,000
ILLINOIS CENTRAL RAILROAD COMPANY
7.70% Debentures due 2096
ILLINOIS CENTRAL RAILROAD COMPANY, a Delaware corporation (such
corporation, and its successors and assigns under the Indenture hereinafter
referred to, being herein called the "Issuer"), for value received, hereby
promises to pay to Cede & Co., or registered assigns, the principal sum of One
Hundred Twenty-Five Million United States Dollars at the office or agency of
the Issuer referred to below, on September 15, 2096 and to pay interest,
semi-annually on March 15 and September 15 of each year, on said principal sum
at said office or agency, at the rate of 7.70% per annum, plus Liquidated
Damages (as hereinafter defined), if any, from the March 15 or September 15,
as the case may be, next preceding the date of this Security to which interest
and Liquidated Damages, if any, have been paid, unless the date hereof is the
date to which interest and Liquidated Damages, if any, have been paid, in
which case from the date of this Security, or unless no interest or Liquidated
Damages, if any, has been paid on the Securities, in which case from December
17, 1996, until payment of said principal sum has been made or duly provided
for, provided, however, that payment of interest and Liquidated Damages, if
any, may be made at the option of the Issuer (i) by check mailed to the
address of the Person entitled thereto as such address shall appear on the
register of Securities or (ii) by transfer in immediately available funds to
an account maintained by the Person entitled thereto with a bank located in
the United States as designated by such Person not less than 15 calendar days
prior to the date interest is payable; provided, further, that if the date
hereof is after the first day of the calendar month preceding any March 15 or
September 15, as the case may be, and prior to such March 15 or September 15,
this Security shall bear interest and Liquidated Damages, if any, from such
March 15 or September 15; provided, further, that if and to the extent that
the Issuer shall default in the payment of interest or Liquidated Damages, if
any, due on any March 15 or September 15, then this Security shall bear
interest and Liquidated Damages, if any, from the next preceding March 15 or
September 15 to which interest and Liquidated Damages, if any, have been paid,
or, if no interest and Liquidated Damages, if any, have been paid on the
Securities, from December 17, 1996. The interest and Liquidated Damages, if
any, so payable on any March 15 or September 15 will, subject to certain
exceptions provided in the Indenture referred to on the reverse hereof, be
paid to the Person in whose name this Security is registered at the close of
business on the first day of the calendar month preceding such March 15 or
September 15; provided that the interest and Liquidated Damages, if any,
payable at maturity shall be payable to the Person to whom principal shall be
payable. Notwithstanding the foregoing, (i) interest on Exchange Debentures
(as defined in the First Supplemental Indenture referred to herein) and
Restricted Exchange Debentures (as defined in such First Supplemental
Indenture) will accrue as provided in such First Supplemental Indenture and
the Registration Rights Agreement (as defined in such First Supplemental
Indenture), and (ii) Liquidated Damages (as defined in such First Supplemental
Indenture), if any, that accrue on Original Debentures prior to the exchange of
such Original Debentures for Exchange Debentures shall be payable to the
Persons, at the times and otherwise on the terms provided in such First
Supplemental Indenture and the Registration Rights Agreement.
Reference is made to the further provisions of this Security
set forth on the reverse hereof. Such further provisions shall for all
purposes have the same effect as though fully set forth at this place.
This Security shall not be valid or become obligatory for any
purpose until the certificate of authentication hereon shall have been signed
by the Trustee under the Indenture referred to on the reverse hereof.
IN WITNESS WHEREOF, Illinois Central Railroad Company has
caused this instrument to be executed in its name and on its behalf by the
signature of the Chief Financial Officer and by the signature of its Vice
President and has caused its corporate seal to be affixed hereunto or
imprinted hereon.
Dated: December 17, 1996
[SEAL] ILLINOIS CENTRAL RAILROAD COMPANY
By:
-----------------------------
By:
-----------------------------
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities described in
the within-mentioned Indenture.
THE CHASE MANHATTAN BANK,
as Trustee
By:
-----------------------------
Authorized Officer
[Reverse of Security]
ILLINOIS CENTRAL RAILROAD COMPANY
7.70% DEBENTURES DUE 2096
This Security is one of a duly authorized series of Securities
of the Issuer, designated as its 7.70% Debentures due 2096 (herein called the
"Securities"), limited (except as otherwise provided in the Indenture referred
to below) to the aggregate principal amount of $125,000,000, all issued or to
be issued under and pursuant to an Indenture, dated as of July 25, 1996, as
supplemented by the First Supplemental Indenture dated as of December 17, 1996
(said Indenture, as supplemented by such First Supplemental Indenture and as
it may be further supplemented and amended, being herein called the
"Indenture"), duly executed and delivered by the Company and The Chase
Manhattan Bank, as Trustee (herein called the "Trustee", which term shall
include any successor Trustee under the Indenture), to which Indenture
reference is hereby made for a statement of the respective rights, limitations
of rights, duties, obligations and immunities thereunder of the Company, the
Trustee and the Holders of the Securities, and of the terms upon which the
Securities are, and are to be, authenticated and delivered. The Securities
are issuable in registered form only, without coupons, in denominations of
$1,000 and integral multiples thereof; provided that Restricted Certificated
Debentures (as defined in the Indenture) shall be issued in minimum
denominations of $100,000 and integral multiples of $1,000 above that amount.
All terms used in this Security which are defined in the Indenture and not
otherwise defined herein shall have the meanings assigned to them in the
Indenture; and all references in the Indenture to "Security" or "Securities"
shall be deemed to include this Security.
Interest and Liquidated Damages, if any, on the Securities
shall be computed on the basis of a 360-day year of twelve 30-day months. If
the date of maturity or of payment of interest and Liquidated Damages, if any,
or principal of the Securities or the date fixed for redemption of any
Security shall not be a Business Day (as defined in the Indenture), then
payment of interest and Liquidated Damages, if any, or principal will be made
on the next succeeding Business Day, with the same force and effect as if made
on the date of maturity or of payment of interest and Liquidated Damages, if
any, or principal or the date fixed for redemption, and no additional interest
or Liquidated Damages, if any, shall accrue by reason of the postponement of
any payment from such originally scheduled date to such next succeeding
Business Day.
The Issuer shall pay Liquidated Damages, if any, on this
Security or any Exchange Debenture (as defined in the First Supplemental
Indenture referred to herein) issued in exchange therefor on each date for the
payment of interest on this Security or such Exchange Debenture to the Person
entitled to receive the interest payable on this Security or such Exchange
Debenture on such date, in the amounts, for the periods and on the other terms
provided herein and in the Registration Rights Agreement dated as of December
17, 1996 (herein called the "Registration Rights Agreement") among the Issuer,
Lehman Brothers Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated.
The Securities may not be redeemed prior to September 15, 2026.
The Securities will be subject to redemption at any time on or after September
15, 2026, at the option of the Issuer, in whole or in part, at the following
redemption prices (expressed as percentages of the principal amount), plus
accrued and unpaid interest and Liquidated Damages, if any, to the redemption
date, if redeemed during the 12-month period beginning September 15 of the
years indicated below:
<TABLE>
<S> <C> <C> <C> <C> <C>
Year Redemption Price Year Redemption Price Year Redemption Price
2026...... 102.92% 2033... 101.90% 2040.................. 100.88%
2027...... 102.77% 2034... 101.75% 2041.................. 100.73%
2028...... 102.63% 2035... 101.60% 2042.................. 100.58%
2029...... 102.48% 2036... 101.46% 2043.................. 100.44%
2030...... 102.33% 2037... 101.31% 2044.................. 100.29%
2031...... 102.19% 2038... 101.17% 2045.................. 100.15%
2032...... 102.04% 2039... 101.02% 2046 and thereafter... 100.00%
</TABLE>
Notice of such redemption shall be mailed not less than 30 nor more than 60
days prior to the date fixed for redemption to the Holders of Securities to be
redeemed, all as provided in the Indenture, in the circumstances set forth in
this paragraph.
Subject to payment by the Issuer of a sum sufficient to pay the
amount due on redemption, interest and Liquidated Damages, if any, on this
Security (or portion hereof if this Security is redeemed in part) shall cease
to accrue upon the date duly fixed for redemption of this Security (or portion
hereof if this Security is redeemed in part).
In case an Event of Default, as defined in the Indenture, shall
have occurred and be continuing, the principal hereof and interest and
Liquidated Damages, if any, hereon may be declared, and upon such declaration
shall become, due and payable, in the manner, with the effect and subject to
the conditions provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Issuer and
the Trustee with the consent of the Holders of a majority in aggregate
principal amount of the Securities at the time outstanding of each series to
be affected. The Indenture also contains provisions permitting the Holders of
specified percentages in principal amount of the Securities of each series at
the time outstanding, on behalf of the Holders of all the Securities of such
series, to waive compliance by the Issuer with certain provisions of the
Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Security shall
be conclusive and binding upon such Holder and upon all future Holders of this
Security and of any Security issued upon the registration of transfer hereof
or in exchange herefor or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Security.
The Indenture contains provisions for defeasance at any time of
(a) the entire indebtedness of the Issuer on this Security and (b) certain
restrictive covenants and the related Events of Default, upon compliance by
the Issuer with certain conditions set forth therein, which provisions apply
to this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Issuer, which is absolute and unconditional, to pay the principal of and
interest and Liquidated Damages, if any, on this Security at the place, at the
respective times, at the rates and in the coin or currency prescribed herein.
Upon occurrence of a Tax Event, the Issuer shall have the right
to shorten the maturity of the Securities to the extent required, in the
opinion of a nationally recognized independent tax counsel, such that, after
the shortening of the maturity, interest paid on the Securities will be
deductible for Federal income tax purposes.
In the event that the Issuer elects to exercise its right to
shorten the maturity of the Securities upon the occurrence of a Tax Event, the
Issuer will mail a notice of shortened maturity to each Holder of record of the
Securities by first-class mail not more than 60 days after the occurrence of
such Tax Event, stating the new maturity date of the Debentures. Such notice
shall be effective immediately upon mailing.
"Tax Event" means that the Company shall have received an
opinion of a nationally recognized independent tax counsel to the effect that
on or after December 12, 1996, as a result of (a) any amendment to,
clarification of, or change (including any announced prospective change) in
laws, or any regulations thereunder, of the United States, (b) any judicial
decision, official administrative pronouncement, ruling, regulatory procedure,
notice or announcement, including any notice or announcement of intent to
adopt such procedures or regulations (an "Administrative Action"), or (c) any
amendment to, clarification of, or change in the official position or the
interpretation of such Administrative Action or judicial decision that differs
from the theretofore generally accepted position, in each case, on or after
December 12, 1996, such change in tax law creates a more than insubstantial
risk that interest paid by the Company on the Securities is not, or will not
be, deductible, in whole or in part, by the Company for purposes of United
States Federal income tax.
As provided in the Indenture and subject to certain limitations
set forth therein and to the limitations described below, if applicable, the
transfer of this Security is registerable in the Security Register upon
surrender of this Security for registration of transfer at the office or
agency of the Company maintained for that purpose in the Borough of Manhattan,
The City of New York, duly endorsed by, or accompanied by a written instrument
of transfer in form satisfactory to the Company and the Registrar (which shall
initially be the Trustee, at its principal corporate trust office in The City
of New York) duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities with like
terms and conditions, of authorized denominations and for the same maturity
and aggregate principal amount, will be issued to the designated transferee or
transferees.
If this Security is a Registered Global Security, this Security
is exchangeable for certificated Securities only upon the terms and conditions
provided in the Indenture. Except as provided above, owners of beneficial
interests in this Registered Global Security will not be entitled to receive
physical delivery of Securities in certificated registered form and will not
be considered the Holders thereof for any purpose under the Indenture.
No service charge shall be made for any such registration of
transfer or exchange, but the Issuer may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Issuer, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and none of
the Issuer, the Trustee or any such agent shall be affected by notice to the
contrary.
The Indenture and the Securities shall be governed by and
construed in accordance with the laws of the State of New York.
Schedule A
Exchange of portions of this Global
Security for other forms of Securities
<TABLE>
<S> <C> <C> <C>
Principal Amount of Remaining
Securities Issued in Principal
Exchange for a Portion Amount of This Notation
Date of This Global Security Global Security Made By
- ----------- ------------------------- ----------------- -----------
- ----------- ------------------------- ----------------- -----------
- ----------- ------------------------- ----------------- -----------
- ----------- ------------------------- ----------------- -----------
- ----------- ------------------------- ----------------- -----------
- ----------- ------------------------- ----------------- -----------
- ----------- ------------------------- ----------------- -----------
- ----------- ------------------------- ----------------- -----------
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</TABLE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as through they were written
out in full according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as
tenants in common
UNIF GIFT MIN ACT Custodian
-------------------------------------------
(Cust) (Minor)
Under Uniform Gifts to Minors Act
-------------------------------------------
(State)
Additional abbreviations may also be used though not in the
above list.
---------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
- -------------------------------
- -------------------------------
- -------------------------------------------------------------------------------
PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
- -------------------------------------------------------------------------------
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing attorney to transfer said Security on the
-----------------
books of the Issuer, with full power of substitution in the premises.
Dated:
------------------
Signature
Sign exactly as name appears on the front
of this Note [SIGNATURE MUST BE
GUARANTEED by a commercial bank, a trust
company or by a member of the New York
Stock Exchange]
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE WITHIN INSTRUMENT IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.
Exhibit B
[FORM OF RESTRICTED CERTIFICATED DEBENTURE]
[FORM OF FACE OF SECURITY]
THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS, AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED EXCEPT AS SET
FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED
INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES
ACT) ("INSTITUTIONAL ACCREDITED INVESTOR"), (2) AGREES THAT IT WILL NOT WITHIN
THREE YEARS AFTER THE ORIGINAL ISSUANCE OF THE SECURITY EVIDENCED HEREBY
RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY, EXCEPT (A) TO
ILLINOIS CENTRAL RAILROAD COMPANY (THE "ISSUER"), (B) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER
THE SECURITIES ACT, (D) TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO
SUCH TRANSFER, FURNISHES TO THE CHASE MANHATTAN BANK, AS TRUSTEE, A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH
LETTER CAN BE OBTAINED FROM THE TRUSTEE), (E) PURSUANT TO OFFERS OR SALES THAT
OCCUR OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 UNDER THE
SECURITIES ACT, OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER'S AND
THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSE (D), (E) OR (F) TO REQUIRE THE DELIVERY TO THEM OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM,
AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITY
EVIDENCED HEREBY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND. IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY
WITHIN THREE YEARS AFTER THE ORIGINAL ISSUANCE OF SUCH SECURITY, THE HOLDER
MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE
MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE CHASE MANHATTAN
BANK, AS TRANSFER AGENT. IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL
ACCREDITED INVESTOR AND IN CERTAIN OTHER CASES NOTED ABOVE, THE HOLDER MUST,
PRIOR TO SUCH TRANSFER, FURNISH TO THE ISSUER AND THE CHASE MANHATTAN BANK, AS
TRANSFER AGENT, SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS
THEY MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE
PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED
AFTER THE EXPIRATION OF THREE YEARS FROM THE ORIGINAL ISSUANCE OF THE SECURITY
EVIDENCED HEREBY. TRANSFERS OF THIS SECURITY SHALL BE LIMITED TO TRANSFERS
MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.6 OF THE FIRST
SUPPLEMENTAL INDENTURE REFERRED TO HEREIN.
CUSIP NO. 451866SW8
No. $
------- -----------
ILLINOIS CENTRAL RAILROAD COMPANY
7.70% Debentures due 2096
ILLINOIS CENTRAL RAILROAD COMPANY, a Delaware corporation (such
corporation, and its successors and assigns under the Indenture hereinafter
referred to, being herein called the "Issuer"), for value received, hereby
promises to pay to , or registered assigns, the principal sum of
-------------
United States Dollars at the office or agency of the
- --------------------
Issuer referred to below, on September 15, 2096 and to pay interest,
semi-annually on March 15 and September 15 of each year, on said principal sum
at said office or agency, at the rate of 7.70% per annum, plus Liquidated
Damages (as hereinafter defined), if any, from the March 15 or September 15,
as the case may be, next preceding the date of this Security to which interest
and Liquidated Damages, if any, have been paid, unless the date hereof is the
date to which interest and Liquidated Damages, if any, have been paid, in
which case from the date of this Security, or unless no interest or Liquidated
Damages, if any, has been paid on the Securities, in which case from December
17, 1996, until payment of said principal sum has been made or duly provided
for, provided, however, that payment of interest and Liquidated Damages, if
any, may be made at the option of the Issuer (i) by check mailed to the
address of the Person entitled thereto as such address shall appear on the
register of Securities or (ii) by transfer in immediately available funds to an
account maintained by the Person entitled thereto with a bank located in the
United States as designated by such Person not less than 15 calendar days
prior to the date interest is payable; provided, further, that if the date
hereof is after the first day of the calendar month preceding any March 15 or
September 15, as the case may be, and prior to such March 15 or September 15,
this Security shall bear interest and Liquidated Damages, if any, from such
March 15 or September 15; provided, further, that if and to the extent that
the Company shall default in the payment of interest or Liquidated Damages,
if any, due on any March 15 or September 15, then this Security shall bear
interest and Liquidated Damages, if any, from the next preceding March 15 or
September 15 to which interest and Liquidated Damages, if any, have been paid,
or, if no interest and Liquidated Damages, if any, have been paid on the
Securities, from December 17, 1996. The interest and Liquidated Damages, if
any, so payable on any March 15 or September 15 will, subject to certain
exceptions provided in the Indenture referred to on the reverse hereof, be
paid to the Person in whose name this Security is registered at the close of
business on the first day of the calendar month preceding such March 15 or
September 15; provided that the interest and Liquidated Damages, if any,
payable at maturity shall be payable to the Person to whom principal shall be
payable. Notwithstanding the foregoing, (i) interest on Exchange Debentures
(as defined in the First Supplemental Indenture referred to herein) and
Restricted Exchange Debentures (as defined in such First Supplemental
Indenture) will accrue as provided in such First Supplemental Indenture and
the Registration Rights Agreement (as defined in such First Supplemental
Indenture), and (ii) Liquidated Damages (as defined in such First Supplemental
Indenture), if any, that accrue on Original Debentures prior to the exchange
of such Original Debentures for Exchange Debentures shall be payable to the
Persons, at the times and otherwise on the terms provided in such First
Supplemental Indenture and the Registration Rights Agreement.
Reference is made to the further provisions of this Security set
forth on the reverse hereof. Such further provisions shall for all purposes
have the same effect as though fully set forth at this place.
This Security shall not be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been signed by the
Trustee under the Indenture referred to on the reverse hereof.
IN WITNESS WHEREOF, Illinois Central Railroad Company has caused this
instrument to be executed in its name and on its behalf by the signature of
the Chief Financial Officer and by the signature of its Vice President and has
caused its corporate seal to be affixed hereunto or imprinted hereon.
Dated: ,
-------------- ----
[SEAL] ILLINOIS CENTRAL RAILROAD COMPANY
By:
------------------------------
By:
------------------------------
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities described in the
within-mentioned Indenture.
THE CHASE MANHATTAN BANK,
as Trustee
By:
-------------------------------
Authorized Officer
[Reverse of Security]
ILLINOIS CENTRAL RAILROAD COMPANY
7.70% DEBENTURES DUE 2096
This Security is one of a duly authorized series of Securities of the
Issuer, designated as its 7.70% Debentures due 2096 (herein called the
"Securities"), limited (except as otherwise provided in the Indenture referred
to below) to the aggregate principal amount of $125,000,000, all issued or to
be issued under and pursuant to an Indenture, dated as of July 25, 1996, as
supplemented by the First Supplemental Indenture dated as of December 17, 1996
(said Indenture, as supplemented by such First Supplemental Indenture and as
it may be further supplemented and amended, being herein called the
"Indenture"), duly executed and delivered by the Company and The Chase
Manhattan Bank, as Trustee (herein called the "Trustee", which term shall
include any successor Trustee under the Indenture), to which Indenture
reference is hereby made for a statement of the respective rights, limitations
of rights, duties, obligations and immunities thereunder of the Company, the
Trustee and the Holders of the Securities, and of the terms upon which the
Securities are, and are to be, authenticated and delivered. The Securities
are issuable in registered form only, without coupons, in denominations of
$1,000 and integral multiples thereof; provided that Restricted Certificated
Debentures (as defined in the Indenture) shall be issued in minimum
denominations of $100,000 and integral multiples of $1,000 above that amount.
All terms used in this Security which are defined in the Indenture and not
otherwise defined herein shall have the meanings assigned to them in the
Indenture; and all references in the Indenture to "Security" or "Securities"
shall be deemed to include this Security.
Interest and Liquidated Damages, if any, on the Securities shall be
computed on the basis of a 360-day year of twelve 30-day months. If the date
of maturity or of payment of interest and Liquidated Damages, if any, or
principal of the Securities or the date fixed for redemption of any Security
shall not be a Business Day (as defined in the Indenture), then payment of
interest and Liquidated Damages, if any, or principal will be made on the next
succeeding Business Day, with the same force and effect as if made on the date
of maturity or of payment of interest and Liquidated Damages, if any, or
principal or the date fixed for redemption, and no additional interest or
Liquidated Damages, if any, shall accrue by reason of the postponement of any
payment from such originally scheduled date to such next succeeding Business
Day.
The Issuer shall pay Liquidated Damages, if any, on this Security or
any Exchange Debenture (as defined in the First Supplemental Indenture
referred to herein) issued in exchange therefor on each date for the payment
of interest on this Security or such Exchange Debenture to the Person entitled
to receive the interest payable on this Security or such Exchange Debenture on
such date, in the amounts, for the periods and on the other terms provided
herein and in the Registration Rights Agreement dated as of December 17, 1996
(herein called the "Registration Rights Agreement") among the Issuer, Lehman
Brothers Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated.
The Securities may not be redeemed prior to September 15, 2026. The
Securities will be subject to redemption at any time on or after September 15,
2026, at the option of the Issuer, in whole or in part, at the following
redemption prices (expressed as percentages of the principal amount), plus
accrued and unpaid interest and Liquidated Damages, if any, to the redemption
date, if redeemed during the 12-month period beginning September 15 of the
years indicated below:
<TABLE>
<S> <C> <C> <C> <C> <C>
Year Redemption Price Year Redemption Price Year Redemption Price
2026...... 102.92% 2033... 101.90% 2040.................. 100.88%
2027...... 102.77% 2034... 101.75% 2041.................. 100.73%
2028...... 102.63% 2035... 101.60% 2042.................. 100.58%
2029...... 102.48% 2036... 101.46% 2043.................. 100.44%
2030...... 102.33% 2037... 101.31% 2044.................. 100.29%
2031...... 102.19% 2038... 101.17% 2045.................. 100.15%
2032...... 102.04% 2039... 101.02% 2046 and thereafter... 100.00%
</TABLE>
Notice of such redemption shall be mailed not less than 30 nor more than 60
days prior to the date fixed for redemption to the Holders of Securities to be
redeemed, all as provided in the Indenture, in the circumstances set forth in
this paragraph.
Subject to payment by the Issuer of a sum sufficient to pay the
amount due on redemption, interest and Liquidated Damages, if any, on this
Security (or portion hereof if this Security is redeemed in part) shall cease
to accrue upon the date duly fixed for redemption of this Security (or portion
hereof if this Security is redeemed in part).
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal hereof and interest and Liquidated
Damages, if any, hereon may be declared, and upon such declaration shall
become, due and payable, in the manner, with the effect and subject to the
conditions provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Issuer and the rights of the Holders of the Securities of each series to
be affected under the Indenture at any time by the Issuer and the Trustee with
the consent of the Holders of a majority in aggregate principal amount of the
Securities at the time outstanding of each series to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
outstanding, on behalf of the Holders of all the Securities of such series, to
waive compliance by the Issuer with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and
binding upon such Holder and upon all future Holders of this Security and of
any Security issued upon the registration of transfer hereof or in exchange
herefor or in lieu hereof, whether or not notation of such consent or waiver
is made upon this Security.
The Indenture contains provisions for defeasance at any time of (a)
the entire indebtedness of the Issuer on this Security and (b) certain
restrictive covenants and the related Events of Default, upon compliance by
the Issuer with certain conditions set forth therein, which provisions apply
to this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Issuer, which is absolute and unconditional, to pay the principal of and
interest and Liquidated Damages, if any, on this Security at the place, at the
respective times, at the rates and in the coin or currency prescribed herein.
Upon occurrence of a Tax Event, the Issuer shall have the right to
shorten the maturity of the Securities to the extent required, in the opinion
of a nationally recognized independent tax counsel, such that, after the
shortening of the maturity, interest paid on the Securities will be deductible
for Federal income tax purposes.
In the event that the Issuer elects to exercise its right to shorten
the maturity of the Securities upon the occurrence of a Tax Event, the Issuer
will mail a notice of shortened maturity to each Holder of record of the
Securities by first-class mail not more than 60 days after the occurrence of
such Tax Event, stating the new maturity date of the Debentures. Such notice
shall be effective immediately upon mailing.
"Tax Event" means that the Company shall have received an opinion of
a nationally recognized independent tax counsel to the effect that on or after
December 12, 1996, as a result of (a) any amendment to, clarification of, or
change (including any announced prospective change) in laws, or any regulations
thereunder, of the United States, (b) any judicial decision, official
administrative pronouncement, ruling, regulatory procedure, notice or
announcement, including any notice or announcement of intent to adopt such
procedures or regulations (an "Administrative Action"), or (c) any amendment
to, clarification of, or change in the official position or the interpretation
of such Administrative Action or judicial decision that differs from the
theretofore generally accepted position, in each case, on or after December
12, 1996, such change in tax law creates a more than insubstantial risk that
interest paid by the Company on the Securities is not, or will not be,
deductible, in whole or in part, by the Company for purposes of United States
Federal income tax.
As provided in the Indenture and subject to certain limitations set
forth therein and to the limitations described below, if applicable, the
transfer of this Security is registerable in the Security Register upon
surrender of this Security for registration of transfer at the office or
agency of the Company maintained for that purpose in the Borough of Manhattan,
The City of New York, duly endorsed by, or accompanied by a written instrument
of transfer in form satisfactory to the Company and the Registrar (which shall
initially be the Trustee, at its principal corporate trust office in The City
of New York) duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities with like
terms and conditions, of authorized denominations and for the same maturity
and aggregate principal amount, will be issued to the designated transferee or
transferees.
No service charge shall be made for any such registration of transfer
or exchange, but the Issuer may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Issuer, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and none of
the Issuer, the Trustee or any such agent shall be affected by notice to the
contrary.
The Indenture and the Securities shall be governed by and construed
in accordance with the laws of the State of New York.
ABBREVIATIONS
The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as through they were written
out in full according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as
tenants in common
UNIF GIFT MIN ACT Custodian
-------------------------------------------
(Cust) (Minor)
Under Uniform Gifts to Minors Act
-------------------------------------------
(State)
Additional abbreviations may also be used though not in the
above list.
-----------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
- ---------------------------
- ---------------------------
- ------------------------------------------------------------------------------
PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
- ------------------------------------------------------------------------------
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing attorney to transfer said Security on the
-----------------
books of the Issuer, with full power of substitution in the premises.
Dated:
----------
Signature
Sign exactly as name appears on the
front of this Note [SIGNATURE MUST BE
GUARANTEED by a commercial bank, a
trust company or by a member of the New
York Stock Exchange]
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE WITHIN INSTRUMENT IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.
TRANSFER CERTIFICATION
In connection with any transfer of this Security occurring prior to
the date which is the earlier of three years after the later of the original
issuance of this Security or the last date on which this Security was held by
an Affiliate of the Issuer, the undersigned confirms that without utilizing any
general solicitation or general advertising that:
[Check One]
[ ] (a) this Security is being transferred in compliance with the
exemption from registration under the Securities Act of 1933,
as amended, provided by Rule 144A thereunder.
[ ] (b) this Security is being transferred other than in accordance
with (a) above and documents are being furnished which comply
with the conditions of transfer set forth in this Security and
the Indenture.
If none of the foregoing boxes is checked, the Trustee or other Registrar
shall not be obligated to register this Security in the name of any Person
other than the Holder hereof unless and until the conditions to any such
transfer of registration set forth herein and in Section 2.6 of the First
Supplemental Indenture shall have been satisfied.
Date:
----------------- --------------------------------------
NOTICE: The signature to this assignment must
correspond with the name as written upon the
face of the within-mentioned instrument in
every particular, without alteration or any
change whatsoever.
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that each of it and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, as amended, and is aware that the sale to it or such
account is being made in reliance on Rule 144A and acknowledges that it has
received such information regarding the Issuer as the undersigned has
requested pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated:
----------------- --------------------------------------
NOTICE: To be executed by an executive
officer.
Exhibit C
[FORM OF EXCHANGE DEBENTURE]
[FORM OF FACE OF SECURITY]
CUSIP NO.
-------------
No. $
------ ----------
ILLINOIS CENTRAL RAILROAD COMPANY
7.70% Debentures due 2096
ILLINOIS CENTRAL RAILROAD COMPANY, a Delaware corporation (such
corporation, and its successors and assigns under the Indenture hereinafter
referred to, being herein called the "Issuer"), for value received, hereby
promises to pay to , or registered assigns, the principal sum of
--------
_ United States Dollars at the office or agency of the
----------------------
Issuer referred to below, on September 15, 2096 and to pay interest,
semi-annually on March 15 and September 15 of each year, on said principal sum
at said office or agency, at the rate of 7.70% per annum, from the March 15 or
September 15, as the case may be, next preceding the date of this Security to
which interest has been paid, unless the date hereof is the date to which
interest has been paid, in which case from the date of this Security, or
unless no interest has been paid on the Securities, in which case from
December 17, 1996, until payment of said principal sum has been made or duly
provided for, provided, however, that payment of interest may be made at the
option of the Issuer (i) by check mailed to the address of the Person entitled
thereto as such address shall appear on the register of Securities or (ii) by
transfer in immediately available funds to an account maintained by the Person
entitled thereto with a bank located in the United States as designated by
such Person not less than 15 calendar days prior to the date interest is
payable; provided, further, that if the date hereof is after the first day of
the calendar month preceding any March 15 or September 15, as the case may be,
and prior to such March 15 or September 15, this Security shall bear interest
from such March 15 or September 15; provided, further, that if and to the
extent that the Issuer shall default in the payment of interest due on any
March 15 or September 15, then this Security shall bear interest from the next
preceding March 15 or September 15 to which interest has been paid, or, if no
interest has been paid on the Securities, from December 17, 1996. The
interest so payable on any March 15 or September 15 will, subject to certain
exceptions provided in the Indenture referred to on the reverse hereof, be
paid to the Person in whose name this Security is registered at the close of
business on the first day of the calendar month preceding such March 15 or
September 15; provided that the interest payable at maturity shall be payable
to the Person to whom principal shall be payable. Notwithstanding the
foregoing, (i) interest on Exchange Debentures (as defined in the First
Supplemental Indenture referred to herein) and Restricted Exchange Debentures
(as defined in such First Supplemental Indenture) will accrue as provided in
such First Supplemental Indenture and the Registration Rights Agreement (as
defined in such First Supplemental Indenture), and (ii) Liquidated Damages (as
defined in such First Supplemental Indenture), if any, that accrue on Original
Debentures prior to the exchange of such Original Debentures for Exchange
Debentures shall be payable to the Persons, at the times and otherwise on the
terms provided in such First Supplemental Indenture and the Registration Rights
Agreement.
Reference is made to the further provisions of this Security set
forth on the reverse hereof. Such further provisions shall for all purposes
have the same effect as though fully set forth at this place.
This Security shall not be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been signed by the
Trustee under the Indenture referred to on the reverse hereof.
IN WITNESS WHEREOF, Illinois Central Railroad Company has caused this
instrument to be executed in its name and on its behalf by the signature of
the Chief Financial Officer and by the signature of its Vice President and has
caused its corporate seal to be affixed hereunto or imprinted hereon.
Dated: ,
---------- ----
[SEAL] ILLINOIS CENTRAL RAILROAD COMPANY
By:
------------------------------
By:
------------------------------
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities described in the
within-mentioned Indenture.
THE CHASE MANHATTAN BANK,
as Trustee
By:
-------------------------------
Authorized Officer
[Reverse of Security]
ILLINOIS CENTRAL RAILROAD COMPANY
7.70% DEBENTURES DUE 2096
This Security is one of a duly authorized series of Securities of the
Issuer, designated as its 7.70% Debentures due 2096 (herein called the
"Securities"), limited (except as otherwise provided in the Indenture referred
to below) to the aggregate principal amount of $125,000,000, all issued or to
be issued under and pursuant to an Indenture, dated as of July 25, 1996, as
supplemented by the First Supplemental Indenture dated as of December 17, 1996
(said Indenture, as supplemented by such First Supplemental Indenture and as
it may be further supplemented and amended, being herein called the
"Indenture"), duly executed and delivered by the Company and The Chase
Manhattan Bank, as Trustee (herein called the "Trustee", which term shall
include any successor Trustee under the Indenture), to which Indenture
reference is hereby made for a statement of the respective rights, limitations
of rights, duties, obligations and immunities thereunder of the Company, the
Trustee and the Holders of the Securities, and of the terms upon which the
Securities are, and are to be, authenticated and delivered. The Securities
are issuable in registered form only, without coupons, in denominations of
$1,000 and integral multiples thereof; provided that Restricted Certificated
Debentures (as defined in the Indenture) shall be issued in minimum
denominations of $100,000 and integral multiples of $1,000 above that amount.
All terms used in this Security which are defined in the Indenture and not
otherwise defined herein shall have the meanings assigned to them in the
Indenture; and all references in the Indenture to "Security" or "Securities"
shall be deemed to include this Security.
Interest on the Securities shall be computed on the basis of a
360-day year of twelve 30-day months. If the date of maturity or of payment
of interest or principal of the Securities or the date fixed for redemption of
any Security shall not be a Business Day (as defined in the Indenture), then
payment of interest or principal will be made on the next succeeding Business
Day, with the same force and effect as if made on the date of maturity or of
payment of interest or principal or the date fixed for redemption, and no
additional interest shall accrue by reason of the postponement of any payment
from such originally scheduled date to such next succeeding Business Day.
The Securities may not be redeemed prior to September 15, 2026. The
Securities will be subject to redemption at any time on or after September 15,
2026, at the option of the Issuer, in whole or in part, at the following
redemption prices (expressed as percentages of the principal amount), plus
accrued and unpaid interest to the redemption date, if redeemed during the
12-month period beginning September 15 of the years indicated below:
<TABLE>
<S> <C> <C> <C> <C> <C>
Year Redemption Price Year Redemption Price Year Redemption Price
2026...... 102.92% 2033... 101.90% 2040.................. 100.88%
2027...... 102.77% 2034... 101.75% 2041.................. 100.73%
2028...... 102.63% 2035... 101.60% 2042.................. 100.58%
2029...... 102.48% 2036... 101.46% 2043.................. 100.44%
2030...... 102.33% 2037... 101.31% 2044.................. 100.29%
2031...... 102.19% 2038... 101.17% 2045.................. 100.15%
2032...... 102.04% 2039... 101.02% 2046 and thereafter... 100.00%
</TABLE>
Notice of such redemption shall be mailed not less than 30 nor more than 60
days prior to the date fixed for redemption to the Holders of Securities to be
redeemed, all as provided in the Indenture, in the circumstances set forth in
this paragraph.
Subject to payment by the Issuer of a sum sufficient to pay the
amount due on redemption, interest on this Security (or portion hereof if this
Security is redeemed in part) shall cease to accrue upon the date duly fixed
for redemption of this Security (or portion hereof if this Security is
redeemed in part).
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal hereof and interest hereon may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the
Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Issuer and the rights of the Holders of the Securities of each series to
be affected under the Indenture at any time by the Issuer and the Trustee with
the consent of the Holders of a majority in aggregate principal amount of the
Securities at the time outstanding of each series to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
outstanding, on behalf of the Holders of all the Securities of such series, to
waive compliance by the Issuer with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and
binding upon such Holder and upon all future Holders of this Security and of
any Security issued upon the registration of transfer hereof or in exchange
herefor or in lieu hereof, whether or not notation of such consent or waiver
is made upon this Security.
The Indenture contains provisions for defeasance at any time of (a)
the entire indebtedness of the Issuer on this Security and (b) certain
restrictive covenants and the related Events of Default, upon compliance by
the Issuer with certain conditions set forth therein, which provisions apply
to this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Issuer, which is absolute and unconditional, to pay the principal of and
interest on this Security at the place, at the respective times, at the rate
and in the coin or currency prescribed herein.
Upon occurrence of a Tax Event, the Issuer shall have the right to
shorten the maturity of the Securities to the extent required, in the opinion
of a nationally recognized independent tax counsel, such that, after the
shortening of the maturity, interest paid on the Securities will be deductible
for Federal income tax purposes.
In the event that the Issuer elects to exercise its right to shorten
the maturity of the Securities upon the occurrence of a Tax Event, the Issuer
will mail a notice of shortened maturity to each Holder of record of the
Securities by first-class mail not more than 60 days after the occurrence of
such Tax Event, stating the new maturity date of the Debentures. Such notice
shall be effective immediately upon mailing.
"Tax Event" means that the Company shall have received an opinion of
a nationally recognized independent tax counsel to the effect that on or after
December 12, 1996, as a result of (a) any amendment to, clarification of, or
change (including any announced prospective change) in laws, or any regulations
thereunder, of the United States, (b) any judicial decision, official
administrative pronouncement, ruling, regulatory procedure, notice or
announcement, including any notice or announcement of intent to adopt such
procedures or regulations (an "Administrative Action"), or (c) any amendment
to, clarification of, or change in the official position or the interpretation
of such Administrative Action or judicial decision that differs from the
theretofore generally accepted position, in each case, on or after December
12, 1996, such change in tax law creates a more than insubstantial risk that
interest paid by the Company on the Securities is not, or will not be,
deductible, in whole or in part, by the Company for purposes of United States
Federal income tax.
As provided in the Indenture and subject to certain limitations set
forth therein and to the limitations described below, if applicable, the
transfer of this Security is registerable in the Security Register upon
surrender of this Security for registration of transfer at the office or
agency of the Company maintained for that purpose in the Borough of Manhattan,
The City of New York, duly endorsed by, or accompanied by a written instrument
of transfer in form satisfactory to the Company and the Registrar (which shall
initially be the Trustee, at its principal corporate trust office in The City
of New York) duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities with like
terms and conditions, of authorized denominations and for the same maturity
and aggregate principal amount, will be issued to the designated transferee or
transferees.
If this Security is a Registered Global Security, this Security is
exchangeable for certificated Securities only upon the terms and conditions
provided in the Indenture. Except as provided above, owners of beneficial
interests in this Registered Global Security will not be entitled to receive
physical delivery of Securities in certificated registered form and will not be
considered the Holders thereof for any purpose under the Indenture.
No service charge shall be made for any such registration of transfer
or exchange, but the Issuer may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Issuer, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and none of
the Issuer, the Trustee or any such agent shall be affected by notice to the
contrary.
The Indenture and the Securities shall be governed by and construed
in accordance with the laws of the State of New York.
ABBREVIATIONS
The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as through they were written
out in full according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as
tenants in common
UNIF GIFT MIN ACT Custodian
-------------------------------------------
(Cust) (Minor)
Under Uniform Gifts to Minors Act
-------------------------------------------
(State)
Additional abbreviations may also be used though not in the
above list.
-----------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
- ---------------------------
- ---------------------------
- ------------------------------------------------------------------------------
PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
- ------------------------------------------------------------------------------
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing attorney to transfer said Security on the
-----------------
books of the Issuer, with full power of substitution in the premises.
Dated:
----------
Signature
Sign exactly as name appears on the
front of this Note [SIGNATURE MUST BE
GUARANTEED by a commercial bank, a
trust company or by a member of the New
York Stock Exchange]
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE WITHIN INSTRUMENT IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.
Exhibit D
[FORM OF RESTRICTED EXCHANGE DEBENTURE]
[FORM OF FACE OF SECURITY]
THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS, AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED EXCEPT AS SET
FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED
INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES
ACT) ("INSTITUTIONAL ACCREDITED INVESTOR"), (2) AGREES THAT IT WILL NOT WITHIN
THREE YEARS AFTER THE ORIGINAL ISSUANCE OF THE SECURITY EVIDENCED HEREBY
RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY, EXCEPT (A) TO
ILLINOIS CENTRAL RAILROAD COMPANY (THE "ISSUER"), (B) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER
THE SECURITIES ACT, (D) TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO
SUCH TRANSFER, FURNISHES TO THE CHASE MANHATTAN BANK, AS TRUSTEE, A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH
LETTER CAN BE OBTAINED FROM THE TRUSTEE), (E) PURSUANT TO OFFERS OR SALES THAT
OCCUR OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 UNDER THE
SECURITIES ACT, OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER'S AND
THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSE (D), (E) OR (F) TO REQUIRE THE DELIVERY TO THEM OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM,
AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITY
EVIDENCED HEREBY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND. IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY
WITHIN THREE YEARS AFTER THE ORIGINAL ISSUANCE OF SUCH SECURITY, THE HOLDER
MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE
MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE CHASE MANHATTAN
BANK, AS TRANSFER AGENT. IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL
ACCREDITED INVESTOR AND IN CERTAIN OTHER CASES NOTED ABOVE, THE HOLDER MUST,
PRIOR TO SUCH TRANSFER, FURNISH TO THE ISSUER AND THE CHASE MANHATTAN BANK, AS
TRANSFER AGENT, SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS
THEY MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE
PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED
AFTER THE EXPIRATION OF THREE YEARS FROM THE ORIGINAL ISSUANCE OF THE SECURITY
EVIDENCED HEREBY. TRANSFERS OF THIS SECURITY SHALL BE LIMITED TO TRANSFERS
MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.6 OF THE FIRST
SUPPLEMENTAL INDENTURE REFERRED TO HEREIN.
CUSIP NO.
-------------
No. $
----- ---------------
ILLINOIS CENTRAL RAILROAD COMPANY
7.70% Debentures due 2096
ILLINOIS CENTRAL RAILROAD COMPANY, a Delaware corporation (such
corporation, and its successors and assigns under the Indenture hereinafter
referred to, being herein called the "Issuer"), for value received, hereby
promises to pay to ________, or registered assigns, the principal sum of
_______________________ United States Dollars at the office or agency of the
Issuer referred to below, on September 15, 2096 and to pay interest,
semi-annually on March 15 and September 15 of each year, on said principal sum
at said office or agency, at the rate of 7.70% per annum, from the March 15 or
September 15, as the case may be, next preceding the date of this Security to
which interest has been paid, unless the date hereof is the date to which
interest has been paid, in which case from the date of this Security, or
unless no interest has been paid on the Securities, in which case from
December 17, 1996, until payment of said principal sum has been made or duly
provided for, provided, however, that payment of interest may be made at the
option of the Issuer (i) by check mailed to the address of the Person entitled
thereto as such address shall appear on the register of Securities or (ii) by
transfer in immediately available funds to an account maintained by the Person
entitled thereto with a bank located in the United States as designated by
such Person not less than 15 calendar days prior to the date interest is
payable; provided, further, that if the date hereof is after the first day of
the calendar month preceding any March 15 or September 15, as the case may be,
and prior to such March 15 or September 15, this Security shall bear interest
and from such March 15 or September 15; provided, further, that if and to the
extent that the Issuer shall default in the payment of interest due on any
March 15 or September 15, then this Security shall bear interest from the next
preceding March 15 or September 15 to which interest has been paid, or, if no
interest has been paid on the Securities, from December 17, 1996. The
interest so payable on any March 15 or September 15 will, subject to certain
exceptions provided in the Indenture referred to on the reverse hereof, be
paid to the Person in whose name this Security is registered at the close of
business on the first day of the calendar month preceding such March 15 or
September 15; provided that the interest payable at maturity shall be payable
to the Person to whom principal shall be payable. Notwithstanding the
foregoing, (i) interest on Exchange Debentures (as defined in the First
Supplemental Indenture referred to herein) and Restricted Exchange Debentures
(as defined in such First Supplemental Indenture) will accrue as provided in
such First Supplemental Indenture and the Registration Rights Agreement (as
defined in such First Supplemental Indenture), and (ii) Liquidated Damages (as
defined in such First Supplemental Indenture), if any, that accrue on Original
Debentures prior to the exchange of such Original Debentures for Exchange
Debentures shall be payable to the Persons, at the times and otherwise on the
terms provided in such First Supplemental Indenture and the Registration
Rights Agreement.
Reference is made to the further provisions of this Security set
forth on the reverse hereof. Such further provisions shall for all purposes
have the same effect as though fully set forth at this place.
This Security shall not be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been signed by the
Trustee under the Indenture referred to on the reverse hereof.
IN WITNESS WHEREOF, Illinois Central Railroad Company has caused this
instrument to be executed in its name and on its behalf by the signature of
the Chief Financial Officer and by the signature of its Vice President and has
caused its corporate seal to be affixed hereunto or imprinted hereon.
Dated: ,
---------- ----
[SEAL] ILLINOIS CENTRAL RAILROAD COMPANY
By:
------------------------------
By:
------------------------------
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities described in the
within-mentioned Indenture.
THE CHASE MANHATTAN BANK,
as Trustee
By:
-------------------------------
Authorized Officer
[Reverse of Security]
ILLINOIS CENTRAL RAILROAD COMPANY
7.70% DEBENTURES DUE 2096
This Security is one of a duly authorized series of Securities of the
Issuer, designated as its 7.70% Debentures due 2096 (herein called the
"Securities"), limited (except as otherwise provided in the Indenture referred
to below) to the aggregate principal amount of $125,000,000, all issued or to
be issued under and pursuant to an Indenture, dated as of July 25, 1996, as
supplemented by the First Supplemental Indenture dated as of December 17, 1996
(said Indenture, as supplemented by such First Supplemental Indenture and as
it may be further supplemented and amended, being herein called the
"Indenture"), duly executed and delivered by the Company and The Chase
Manhattan Bank, as Trustee (herein called the "Trustee", which term shall
include any successor Trustee under the Indenture), to which Indenture
reference is hereby made for a statement of the respective rights, limitations
of rights, duties, obligations and immunities thereunder of the Company, the
Trustee and the Holders of the Securities, and of the terms upon which the
Securities are, and are to be, authenticated and delivered. The Securities
are issuable in registered form only, without coupons, in denominations of
$1,000 and integral multiples thereof; provided that Restricted Certificated
Debentures (as defined in the Indenture) shall be issued in minimum
denominations of $100,000 and integral multiples of $1,000 above that amount.
All terms used in this Security which are defined in the Indenture and not
otherwise defined herein shall have the meanings assigned to them in the
Indenture; and all references in the Indenture to "Security" or "Securities"
shall be deemed to include this Security.
Interest on the Securities shall be computed on the basis of a
360-day year of twelve 30-day months. If the date of maturity or of payment
of interest or principal of the Securities or the date fixed for redemption of
any Security shall not be a Business Day (as defined in the Indenture), then
payment of interest or principal will be made on the next succeeding Business
Day, with the same force and effect as if made on the date of maturity or of
payment of interest or principal or the date fixed for redemption, and no
additional interest shall accrue by reason of the postponement of any payment
from such originally scheduled date to such next succeeding Business Day.
The Securities may not be redeemed prior to September 15, 2026. The
Securities will be subject to redemption at any time on or after September 15,
2026, at the option of the Issuer, in whole or in part, at the following
redemption prices (expressed as percentages of the principal amount), plus
accrued and unpaid interest to the redemption date, if redeemed during the
12-month period beginning September 15 of the years indicated below:
<TABLE>
<S> <C> <C> <C> <C> <C>
Year Redemption Price Year Redemption Price Year Redemption Price
2026...... 102.92% 2033... 101.90% 2040.................. 100.88%
2027...... 102.77% 2034... 101.75% 2041.................. 100.73%
2028...... 102.63% 2035... 101.60% 2042.................. 100.58%
2029...... 102.48% 2036... 101.46% 2043.................. 100.44%
2030...... 102.33% 2037... 101.31% 2044.................. 100.29%
2031...... 102.19% 2038... 101.17% 2045.................. 100.15%
2032...... 102.04% 2039... 101.02% 2046 and thereafter... 100.00%
</TABLE>
Notice of such redemption shall be mailed not less than 30 nor more than 60
days prior to the date fixed for redemption to the Holders of Securities to be
redeemed, all as provided in the Indenture, in the circumstances set forth in
this paragraph.
Subject to payment by the Issuer of a sum sufficient to pay the
amount due on redemption, interest on this Security (or portion hereof if this
Security is redeemed in part) shall cease to accrue upon the date duly fixed
for redemption of this Security (or portion hereof if this Security is
redeemed in part).
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal hereof and interest hereon may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the
Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Issuer and the rights of the Holders of the Securities of each series to
be affected under the Indenture at any time by the Issuer and the Trustee with
the consent of the Holders of a majority in aggregate principal amount of the
Securities at the time outstanding of each series to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
outstanding, on behalf of the Holders of all the Securities of such series, to
waive compliance by the Issuer with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and
binding upon such Holder and upon all future Holders of this Security and of
any Security issued upon the registration of transfer hereof or in exchange
herefor or in lieu hereof, whether or not notation of such consent or waiver
is made upon this Security.
The Indenture contains provisions for defeasance at any time of (a)
the entire indebtedness of the Issuer on this Security and (b) certain
restrictive covenants and the related Events of Default, upon compliance by
the Issuer with certain conditions set forth therein, which provisions apply
to this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Issuer, which is absolute and unconditional, to pay the principal of and
interest on this Security at the place, at the respective times, at the rate
and in the coin or currency prescribed herein.
Upon occurrence of a Tax Event, the Issuer shall have the right to
shorten the maturity of the Securities to the extent required, in the opinion
of a nationally recognized independent tax counsel, such that, after the
shortening of the maturity, interest paid on the Securities will be deductible
for Federal income tax purposes.
In the event that the Issuer elects to exercise its right to shorten
the maturity of the Securities upon the occurrence of a Tax Event, the Issuer
will mail a notice of shortened maturity to each Holder of record of the
Securities by first-class mail not more than 60 days after the occurrence of
such Tax Event, stating the new maturity date of the Debentures. Such notice
shall be effective immediately upon mailing.
"Tax Event" means that the Company shall have received an opinion of
a nationally recognized independent tax counsel to the effect that on or after
December 12, 1996, as a result of (a) any amendment to, clarification of, or
change (including any announced prospective change) in laws, or any regulations
thereunder, of the United States, (b) any judicial decision, official
administrative pronouncement, ruling, regulatory procedure, notice or
announcement, including any notice or announcement of intent to adopt such
procedures or regulations (an "Administrative Action"), or (c) any amendment
to, clarification of, or change in the official position or the interpretation
of such Administrative Action or judicial decision that differs from the
theretofore generally accepted position, in each case, on or after December
12, 1996, such change in tax law creates a more than insubstantial risk that
interest paid by the Company on the Securities is not, or will not be,
deductible, in whole or in part, by the Company for purposes of United States
Federal income tax.
As provided in the Indenture and subject to certain limitations set
forth therein and to the limitations described below, if applicable, the
transfer of this Security is registerable in the Security Register upon
surrender of this Security for registration of transfer at the office or
agency of the Company maintained for that purpose in the Borough of Manhattan,
The City of New York, duly endorsed by, or accompanied by a written instrument
of transfer in form satisfactory to the Company and the Registrar (which shall
initially be the Trustee, at its principal corporate trust office in The City
of New York) duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities with like
terms and conditions, of authorized denominations and for the same maturity
and aggregate principal amount, will be issued to the designated transferee or
transferees.
No service charge shall be made for any such registration of transfer
or exchange, but the Issuer may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Issuer, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and none of
the Issuer, the Trustee or any such agent shall be affected by notice to the
contrary.
The Indenture and the Securities shall be governed by and construed
in accordance with the laws of the State of New York.
ABBREVIATIONS
The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as through they were written
out in full according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as
tenants in common
UNIF GIFT MIN ACT Custodian
-------------------------------------------
(Cust) (Minor)
Under Uniform Gifts to Minors Act
-------------------------------------------
(State)
Additional abbreviations may also be used though not in the
above list.
-----------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
- ---------------------------
- ---------------------------
- ------------------------------------------------------------------------------
PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
- ------------------------------------------------------------------------------
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing attorney to transfer said Security on the
-----------------
books of the Issuer, with full power of substitution in the premises.
Dated:
----------
Signature
Sign exactly as name appears on the
front of this Note [SIGNATURE MUST BE
GUARANTEED by a commercial bank, a
trust company or by a member of the New
York Stock Exchange]
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE WITHIN INSTRUMENT IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.
TRANSFER CERTIFICATION
In connection with any transfer of this Security occurring prior to
the date which is the earlier of three years after the later of the original
issuance of this Security or the last date on which this Security was held by
an Affiliate of the Issuer, the undersigned confirms that without utilizing any
general solicitation or general advertising that:
[Check One]
[ ] (a) this Security is being transferred in compliance with the
exemption from registration under the Securities Act of 1933,
as amended, provided by Rule 144A thereunder.
[ ] (b) this Security is being transferred other than in accordance
with (a) above and documents are being furnished which comply
with the conditions of transfer set forth in this Security and
the Indenture.
If none of the foregoing boxes is checked, the Trustee or other Registrar
shall not be obligated to register this Security in the name of any Person
other than the Holder hereof unless and until the conditions to any such
transfer of registration set forth herein and in Section 2.6 of the First
Supplemental Indenture referred to herein shall have been satisfied.
Date:
-------------------- ------------------------------
NOTICE: The signature to this assignment must
correspond with the name as written upon the
face of the within-mentioned instrument in
every particular, without alteration or any
change whatsoever.
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
of 1933, as amended, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such information
regarding the Issuer as the undersigned has requested pursuant to Rule 144A or
has determined not to request such information and that it is aware that the
transferor is relying upon the undersigned's foregoing representations in
order to claim the exemption from registration provided by Rule 144A.
Dated:
-------------------- --------------------------------------
NOTICE: To be executed by an executive
officer.
Exhibit E
[FORM OF INSTITUTIONAL ACCREDITED INVESTOR CERTIFICATE]
,
--------------- ----
The Chase Manhattan Bank
450 West 33rd Street
15th Floor
New York, NY 10001
Attention: Global Trust Services
Re: Illinois Central Railroad Company
7.70% Debentures due 2096
---------------------------------
Ladies and Gentlemen:
In connection with our purchase of $ principal amount
----------
of 7.70% Debentures due 2096 (the "Debentures") of Illinois Central Railroad
Company (the "Issuer"), we represent, warrant, agree and acknowledge as
follows:
1. The Debentures have not been registered under the
Securities Act of 1933, as amended (the "Securities Act"), or any
other applicable securities law and may not be offered, sold or
otherwise transferred except in compliance with the registration
requirements of the Securities Act and any other applicable
securities law, pursuant to an exemption therefrom or in a transaction
not subject thereto, and in each case in compliance with the terms of
this letter.
2. We are an institutional investor that is an "accredited
investor" (as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act). We have such knowledge and experience in financial
and business matters as to be capable of evaluating the merits and
risks of an investment in the Debentures; we and any accounts for
which we are acting are acquiring the Debentures for investment
purposes and not with a view to, or offer or sale in connection with,
any distribution in violation of the Securities Act, and we and any
accounts for which we are acting are each able to bear the economic
risk of our or its investments.
3. We are acquiring the Debentures purchased by us for our
account or for one or more accounts (each of which is an
institutional "accredited investor" as defined above) as to each of
which we exercise sole investment discretion and for each of which we
are acquiring not less than $100,000 total principal amount of
Debentures.
4. We have received a copy of the Offering Memorandum, dated
December 12, 1996, relating to the Debentures and such other adequate
information concerning the Company and the Debentures as we deem
necessary to make an informed investment decision with respect to our
purchase of the Debentures. We acknowledge that we have read and
acknowledge, represent and agree to the matters stated in such
Offering Memorandum, including the restrictions on duplication and
circulation of such Offering Memorandum.
5. We understand that the Debentures are being sold to us
pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act. We are not
purchasing the Debentures with a view to the resale, distribution or
other disposition thereof.
6. If, within three years after the original issuance of the
Debentures, we should decide to dispose of any Debentures, we shall
not offer, sell, transfer, pledge, hypothecate or otherwise dispose
of any Debentures except:
(a) to the Company;
(b) pursuant to a registration statement which has been
declared effective under the Securities Act;
(c) for so long as the Debentures are eligible for
resale pursuant to Rule 144A under the Securities Act, to a
person we reasonably believe is a qualified institutional buyer
under Rule 144A (a "QIB") that purchases for its own account or
for the account of a QIB and to whom notice is given that the
transfer is being made in reliance on Rule 144A;
(d) inside the United States to an institutional
investor that (i) is an "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act) and
(ii) prior to such transfer, such "accredited investor"
furnishes to The Chase Manhattan Bank, as Trustee, a signed
letter substantially to the effect of this letter (the form of
which can be obtained from such Trustee);
(e) pursuant to offers and sales that occur outside the
United States in compliance with Rule 904 under the Securities
Act, or
(f) pursuant to any other available exemption from the
registration requirements of the Securities Act,
subject in each of the foregoing cases, to any requirement of law that the
disposition of our property or the property of such investor account or
accounts be at all times within our or their control and to compliance with
any applicable state securities laws.
7. We understand that, prior to any proposed transfer of any
Debentures within three years after the original issuance of the
Debentures pursuant to paragraphs 6(d), 6(e) and 6(f), we shall be
required to furnish to the Company and The Chase Manhattan Bank, as
Trustee, such certifications, legal opinions or other information as
they may reasonably require to confirm that the proposed transfer is
being made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act.
8. We understand that the certificates representing the
Debentures will, until the third anniversary of the original issuance
of the Debentures or upon the earlier satisfaction of the Company that
such Debentures have been or are being offered and sold in compliance
with Rule 904 under the Securities Act, bear a legend substantially
to the effect set forth in paragraphs 1, 6 and 7 hereof.
9. We will give to each transferee of such Debentures notice
of any restrictions on transfer of such securities.
10. None of you has made any representation to us with
respect to the Company or the offering or sale of any Debentures,
other than the information contained or incorporated by reference in
this Offering Memorandum, which Offering Memorandum has been
delivered to us and upon which we are relying in making our investment
decision with respect to the Debentures.
11. That you will rely upon the truth and accuracy of the
foregoing acknowledgments, representations and agreements and agrees
that, if any of the acknowledgments, representations or warranties
deemed to have been made by us by our purchase of the Debentures are
no longer accurate, we shall promptly notify Lehman Brothers Inc. and
Merrill Lynch, Pierce, Fenner & Smith Incorporated.
12. We shall preserve copies of this letter and all related
letters, certifications, legal opinions, notices and other documents,
and upon request shall furnish you with copies thereof. You and the
Trustee are entitled to rely on such documents and we irrevocably
authorize you to produce such documents in connection with an
administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.
13. As used herein, the term "United States" has the meaning
given to it by Rule 904 under the Securities Act.
Upon transfer, the Debentures would be registered in the name
of the new beneficial owner as follows:
Name:
-------------------------------------------------
Address:
----------------------------------------------
Taxpayer ID Number:
-----------------------------------
Very truly yours,
-------------------------
(Name of Purchaser)
By:
---------------------
Date:
-------------------
Exhibit F
[FORM OF RESTRICTED EXCHANGE DEBENTURE TRANSFER CERTIFICATE]
In connection with a sale, for value, of 7.70% Debentures due
2096 (the "Debentures") of Illinois Central Railroad Company (the "Company"),
the undersigned Holder confirms the following with respect to the undersigned's
sale of a Restricted Exchange Debenture (Certificate No. ):
--------
(a) The undersigned is listed as a "Selling Securityholder"
in the Shelf Registration Statement with respect to the
Securities (the "Registration Statement").
(b) The sale is being made pursuant to the plan of
distribution described in the Prospectus which is part of the
Registration Statement (as supplemented by all supplements and
post-effective amendments thereto, the "Prospectus").
(c) The Debenture described above is submitted for
registration of transfer in connection with a change of
beneficial ownership resulting from a sale or other transfer
for value.
(d) The undersigned Holder has delivered to the transferee a
Prospectus in connection with the sale of the above-described
Debenture under the above-mentioned Registration Statement, or
has delivered to the Registrar an opinion of counsel,
acceptable to the Registrar, to the effect that delivery of a
Prospectus is not required under the Securities Act of 1933, as
amended.
Defined terms used but not defined herein have the meanings
assigned in the Indenture dated as of July 25, 1996, as supplemented by the
First Supplemental Indenture dated as of December 17, 1996, relating to the
Debentures.
Name of
Selling Holder
-----------------------------------
Signed
--------------------------------------------------
Date:
------------------------
Exhibit 4.3
===========================================================================
REGISTRATION RIGHTS AGREEMENT
Dated as of December 17, 1996
Among
ILLINOIS CENTRAL RAILROAD COMPANY
as Issuer
and
LEHMAN BROTHERS INC.
and
Merrill Lynch & Co.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
as Initial Purchasers
===========================================================================
TABLE OF CONTENTS
Page
1. Definitions.............................................. 1
2. Exchange Offer........................................... 4
3. Shelf Registration....................................... 9
4. Liquidated Damages....................................... 11
5. Registration Procedures.................................. 13
6. Registration Expenses.................................... 23
7. Indemnification.......................................... 24
8. Rules 144 and 144A......................................... 28
9. Underwritten Registrations................................. 28
10. Miscellaneous............................................. 29
(a) No Inconsistent Agreements.......................... 29
(b) Adjustments Affecting Registrable
Debentures....................................... 29
(c) Amendments and Waivers.............................. 29
(d) Notices............................................. 29
(e) Successors and Assigns.............................. 31
(f) Counterparts........................................ 31
(g) Headings............................................ 31
(h) Governing Law....................................... 31
(i) Severability........................................ 31
(j) Third Party Beneficiaries........................... 32
(k) Entire Agreement.................................... 32
(l) Underwriting A.greement............................. 32
(m) Termination......................................... 32
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is dated as
of December 17, 1996 among Illinois Central Railroad Company, a Delaware
corporation (the "Company"), Lehman Brothers Inc., Merrill Lynch & Co. and
Merrill Lynch, Pierce, Fenner & Smith Incorporated (the "Initial Purchasers").
This Agreement is entered into in connection with the Purchase
Agreement, dated December 12, 1996, among the Company and the Initial
Purchasers (the "Purchase Agreement") which provides for the sale by the
Company to the Initial Purchasers of $125,000,000 aggregate principal amount
of the Company's 7.70% Debentures due 2096 (the "Debentures"). In order to
induce the Initial Purchasers to enter into the Purchase Agreement, the
Company has agreed to provide the registration rights set forth in this
Agreement for the benefit of the Initial Purchasers and their direct and
indirect transferees and assigns. The execution and delivery of this
Agreement is a condition to the Initial Purchasers' obligation to purchase the
Debentures under the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions.
As used in this Agreement, the following terms shall have the
following meanings:
Advice: As defined in the last paragraph of Section 5 hereof.
Agreement: As defined in the introductory paragraphs hereto.
Applicable Period: As defined in Section 2(b) hereof.
Company: As defined in the introductory paragraphs hereto.
Effectiveness Date: The 180th day after the Issue Date.
Effectiveness Period: As defined in Section 3(a) hereof.
Event Date: As defined in Section 4(b) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended,
and the rules and regulations of the SEC promulgated thereunder.
Exchange Debentures: As defined in Section 2(a) hereof.
Exchange Offer: As defined in Section 2(a) hereof.
Exchange Offer Registration Statement: As defined in Section 2(a)
hereof.
Filing Date: The 90th day after the Issue Date.
Holder: Any holder of a Registrable Debenture or Registrable
Debentures.
Indemnified Person: As defined in Section 7(c) hereof.
Indemnifying Person: As defined in Section 7(c) hereof.
Indenture: The Indenture, dated as of July 25, 1996, as
supplemented by the First Supplemental Indenture dated as of December 17,
1996, between the Company and The Chase Manhattan Bank, as Trustee, pursuant
to which the Debentures are being issued, and as further amended or
supplemented from time to time in accordance with the terms thereof.
Initial Purchasers: As defined in the introductory paragraphs
hereto.
Inspectors: As defined in Section 5(o) hereof.
Issue Date: The date on which the Debentures were originally
issued under the Indenture.
Liquidated Damages: As defined in Section 4(a) hereof.
NASD: As defined in Section 5(t) hereof.
Debentures: As defined in the introductory paragraphs hereto.
Participant: As defined in Section 7(a) hereof.
Participating Broker-Dealer: As defined in Section 2(b) hereof.
Person: An individual, trustee, corporation, partnership, limited
liability company, joint stock company, trust, unincorporated association,
union, business association, firm or other legal entity.
Private Exchange: As defined in Section 2(b) hereof.
Private Exchange Debentures: As defined in Section 2(b) hereof.
Prospectus: The prospectus included in any Registration Statement
(including, without limitation, any prospectus subject to completion and a
prospectus that includes any information previously omitted from a prospectus
filed as part of an effective registration statement in reliance upon Rule
430A promulgated under the Securities Act), as amended or supplemented by any
prospectus supplement, and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such Prospectus.
Purchase Agreement: As defined in the introductory paragraphs
hereto.
Records: As defined in Section 5(o) hereof.
Registrable Debentures: Each Debenture upon original issuance of
the Debentures and at all times subsequent thereto, each Exchange Debenture as
to which Section 2(c)(iv) hereof is applicable upon original issuance and at
all times subsequent thereto and each Private Exchange Debenture upon original
issuance thereof and at all times subsequent thereto, until in the case of any
such Debenture, Exchange Debenture or Private Exchange Debenture, as the case
may be, the earliest to occur of (i) a Registration Statement (other than,
with respect to any Exchange Debenture as to which Section 2(c)(iv) hereof is
applicable, the Exchange Offer Registration Statement) covering such
Debenture, Exchange Debenture or such Private Exchange Debenture having been
declared effective by the SEC and such Debenture or such Private Exchange
Debenture, as the case may be, having been disposed of in accordance with such
effective Registration Statement, (ii) such Debenture, Exchange Debenture or
Private Exchange Debenture, as the case may be, being eligible for sale to the
public pursuant to Rule 144, (iii) such Debenture having been exchanged for an
Exchange Debenture pursuant to an Exchange Offer which may be resold without
restriction under state and federal securities laws, or (iv) such Debenture,
Exchange Debenture or Private Exchange Debenture, as the case may be, ceasing
to be outstanding for purposes of the Indenture.
Registration Default: As defined in Section 4(a) hereof.
Registration Statement: Any registration statement of the
Company, including, but not limited to, the Exchange Offer Registration
Statement and the Shelf Registration Statement, filed with the SEC pursuant to
the provisions of this Agreement, including the Prospectus, amendments and
supplements to such registration statement, including post-effective
amendments, all exhibits, and all materials incorporated by reference or deemed
to be incorporated by reference in such registration statement.
Rule 144: Rule 144 promulgated under the Securities Act, as such
Rule may be amended from time to time, or any similar rule (other than Rule
144A) or regulation hereafter adopted by the SEC providing for offers and
sales of securities made in compliance therewith resulting in offers and sales
by subsequent holders that are not affiliates of an issuer of such securities
being free of the registration and prospectus delivery requirements of the
Securities Act.
Rule 144A: Rule 144A promulgated under the Securities Act, as
such Rule may be amended from time to time, or any similar rule (other than
Rule 144) or regulation hereafter adopted by the SEC.
Rule 415: Rule 415 promulgated under the Securities Act, as such
Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
Shelf Notice: As defined in Section 2(c) hereof.
Shelf Registration Statement: As defined in Section 3(a) hereof.
Subsequent Shelf Registration Statement: As defined in Section
3(b) hereof.
TIA: The Trust Indenture Act of 1939, as amended.
Trustee: The trustee under the Indenture and, if applicable, the
trustee under any subsequent indenture governing the Exchange Debentures and
Private Exchange Debentures (if any).
Underwritten registration or underwritten offering: A
registration in which securities of the Company are sold to an underwriter for
reoffering to the public.
2. Exchange Offer.
(a) The Company shall file with the SEC no later than the
Filing Date, a registration statement under the Securities Act with respect to
a registered offer to exchange (the "Exchange Offer") any and all of the
Registrable Debentures (other than Private Exchange Debentures, if any) for a
like aggregate principal amount of debt securities of the Company which are
substantially similar in all material respects to the Debentures (the
"Exchange Debentures"), except that the Exchange Debentures shall have been
registered pursuant to an effective Registration Statement under the
Securities Act and shall contain no restrictive legend thereon, and which are
entitled to the benefits of the Indenture or a trust indenture which is
identical in all material respects to the Indenture (other than such changes
to the Indenture or any such identical trust indenture as are necessary to
comply with any requirements of the SEC to effect or maintain the
qualification thereof under the TIA) and which, in either case, has been
qualified under the TIA. The Exchange Offer shall be registered under the
Securities Act on an appropriate form (the "Exchange Offer Registration
Statement") and shall comply with all applicable tender offer rules and
regulations under the Exchange Act. The Company shall use reasonable best
efforts to cause the Exchange Offer Registration Statement to be declared
effective under the Securities Act on or before the Effectiveness Date. Upon
the Exchange Offer Registration Statement being declared effective, the
Company will offer the Exchange Debentures in exchange for surrender of the
Debentures. The Company will keep the Exchange Offer open for at least 20
business days (or longer if required by applicable law) after the date that
notice of the Exchange Offer is mailed to Holders. For purposes of this
Section 2(a) only, if after such Exchange Offer Registration Statement is
initially declared effective by the SEC, the Exchange Offer or the issuance of
the Exchange Debentures thereunder is interfered with by any stop order,
injunction or other order or requirement of the SEC or any other governmental
agency or court, such Exchange Offer Registration Statement shall be deemed
not to have become effective for purposes of this Agreement. Each Holder who
participates in the Exchange Offer will be required to represent that (i) any
Exchange Debentures received by it will be acquired in the ordinary course of
its business, (ii) at the time of the consummation of the Exchange Offer such
Holder will have no arrangement or understanding with any Person to
participate in the distribution of the Exchange Debentures in violation of the
provisions of the Securities Act, and (iii) such Holder is not an affiliate of
the Company within the meaning of the Securities Act. Upon consummation of
the Exchange Offer in accordance with this Section 2, the provisions of this
Agreement shall continue to apply, mutatis mutandis, solely with respect to
Registrable Debentures that are Private Exchange Debentures and Exchange
Debentures held by Participating Broker-Dealers, and the Company shall have no
further obligations to register Registrable Debentures pursuant to Section 3
hereof (other than Private Exchange Debentures and other than in respect of
any Exchange Debentures as to which clause 2(c)(iv) hereof applies). No
securities other than the Exchange Debentures shall be included in the
Exchange Offer Registration Statement.
(b) The Company shall include within the Prospectus contained in
the Exchange Offer Registration Statement certain information necessary to
allow a broker-dealer who holds Debentures that were acquired for its own
account as a result of market-making activities or other ordinary course
trading activities (other than Debentures acquired directly from the Company
or one of the Company's affiliates) to exchange such Debentures pursuant to
the Exchange Offer and to satisfy the prospectus delivery requirements in
connection with resales of Exchange Debentures received by such broker-dealer
in the Exchange Offer, including a section entitled "Plan of Distribution,"
reasonably acceptable to the Initial Purchasers, which shall contain a summary
statement of the positions taken or policies made by the Staff of the Division
of Corporation Finance of the SEC (the "Staff") with respect to the potential
"underwriter" status of any broker-dealer that is the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act) of Exchange Debentures received
by such broker-dealer in the Exchange Offer (a "Participating Broker-Dealer"),
whether such positions or policies have been publicly disseminated by the
Staff or such positions or policies, in the judgment of the Initial
Purchasers, represent the prevailing views of the Staff. Such "Plan of
Distribution" section shall also expressly permit the use of the Prospectus by
all Persons subject to the prospectus delivery requirements of the Securities
Act, including all Participating Broker-Dealers, and include a statement
describing the means by which Participating Broker-Dealers may resell the
Exchange Debentures. Each broker-dealer that receives Exchange Debentures for
its own account in exchange for Debentures where such Debentures were acquired
by such broker-dealer as a result of market-making activities must acknowledge
that it will comply with any prospectus delivery requirements under the
Securities Act in connection with any resale of Exchange Debentures.
The Company shall use its best efforts to keep the Exchange Offer
Registration Statement effective and to amend and supplement the Prospectus
contained therein, in order to permit such Prospectus to be lawfully delivered
by all Persons subject to the prospectus delivery requirements of the
Securities Act for such period of time as is necessary to comply with
applicable law in connection with any resale of the Exchange Debentures;
provided, however, that such period shall not exceed 120 days after the
Exchange Offer Registration Statement is declared effective (or such longer
period if extended pursuant to the last paragraph of Section 5 hereof) (the
"Applicable Period").
If, prior to consummation of the Exchange Offer, the Initial
Purchasers hold any Debentures acquired by them and having, or which are
reasonably likely to be determined to have, the status of any unsold allotment
in the initial distribution, or any other Holder is not entitled to
participate in the Exchange Offer, the Company upon the request of the Initial
Purchasers or any such Holder shall simultaneously with the delivery of the
Exchange Debentures in the Exchange Offer, issue and deliver to the Initial
Purchasers and any such Holder, in exchange (the "Private Exchange") for such
Debentures held by the Initial Purchasers and any such Holder, a like
principal amount of debt securities of the Company that are substantially
similar in all material respects to the Exchange Debentures except for any
such restrictions on transfer that, in the opinion of counsel for the Company,
are required under the Securities Act (the "Private Exchange Debentures") (and
which are issued pursuant to the same indenture as the Exchange Debentures);
provided, however, the Company shall not be required to effect such exchange
if, in the written opinion of counsel for the Company (a copy of which shall
be delivered to the Initial Purchasers and any Holder affected thereby), such
exchange cannot be effected without registration under the Securities Act.
The Private Exchange Debentures shall bear the same CUSIP number as the
Exchange Debentures.
Interest on the Exchange Debentures and the Private Exchange
Debentures will accrue (A) from the last interest payment date on which
interest was paid on the Debentures surrendered in exchange therefor or (B) if
no interest has been paid on the Debentures, from the Issue Date.
In connection with the Exchange Offer, the Company shall:
(1) mail to each Holder a copy of the Prospectus forming part of
the Exchange Offer Registration Statement, together with an appropriate
letter of transmittal and related documents;
(2) utilize the services of a depositary for the Exchange Offer
with an address in the Borough of Manhattan, the City of New York;
(3) permit Holders to withdraw tendered Debentures at any time
prior to the close of business, New York time, on the last business day
on which the Exchange Offer shall remain open; and
(4) otherwise comply in all material respects with all
applicable laws, rules and regulations.
As soon as practicable after the close of the Exchange Offer or
the Private Exchange, as the case may be, the Company shall:
(1) accept for exchange all Debentures tendered and not validly
withdrawn pursuant to the Exchange Offer or the Private Exchange;
(2) deliver to the Trustee for cancellation all Debentures so
accepted for exchange; and
(3) cause the Trustee to authenticate and deliver promptly to
each Holder of Debentures, Exchange Debentures or Private Exchange
Debentures, as the case may be, equal in principal amount to the
Debentures of such Holder so accepted for exchange.
The Exchange Offer and the Private Exchange shall not be subject
to any conditions, other than that (i) the Exchange Offer or the Private
Exchange, as the case may be, does not violate applicable law or any
applicable interpretation of the Staff, (ii) no action or proceeding is
instituted or threatened in any court or by any governmental agency which
might materially impair the ability of the Company to proceed with the Exchange
Offer or the Private Exchange and no material adverse development has occurred
in any existing action or proceeding with respect to the Company and (iii) all
governmental approvals have been obtained, which approvals the Company deems
necessary for the consummation of the Exchange Offer or Private Exchange.
The Exchange Debentures and the Private Exchange Debentures may be
issued under (i) the Indenture or (ii) an indenture identical in all material
respects to the Indenture, which in either event shall provide that the
Exchange Debentures shall not be subject to the transfer restrictions set
forth in the Indenture. The Indenture or such indenture shall provide that
the Exchange Debentures, the Private Exchange Debentures and the Debentures
shall vote and consent together on all matters as one series and that neither
the Exchange Debentures, the Private Exchange Debentures or the Debentures
will have the right to vote or consent as a separate series on any matter.
(c) If (i) the Company determines in reasonably good faith that
(x) any changes in law or in the applicable interpretations of the Staff of
the SEC do not permit the Company to effect an Exchange Offer prior to the
Effectiveness Date, or (y) that the Exchange Debentures would not be tradeable
upon receipt by the Holders that participate in the Exchange Offer without
restriction under applicable state and federal securities laws (other than due
solely to the status of a Holder as an affiliate of the Company within the
meaning of the Securities Act), (ii) the Exchange Offer is not consummated
within 210 days of the Issue Date, (iii) any holder of Private Exchange
Debentures so requests within 180 days after the consummation of the Private
Exchange, or (iv) in the case of any Holder that participates in the Exchange
Offer, such Holder does not receive Exchange Debentures on the date of the
exchange that may be sold without restriction under state and federal
securities laws (other than due solely to the status of such Holder as an
affiliate of the Company within the meaning of the Securities Act) and so
notifies the Company within 60 days after such Holder first becomes aware of
any such restriction and provides the Company with a reasonable basis for its
conclusion, in the case of each of clauses (i), (ii), (iii) and (iv) of this
sentence, then the Company shall promptly deliver to the Holders of
Registrable Debentures and the Trustee written notice thereof (the "Shelf
Notice") and, at the Company's cost, shall, as promptly as practicable, file
a Shelf Registration pursuant to Section 3 hereof.
3. Shelf Registration
If a Shelf Notice is delivered as contemplated by Section 2(c)
hereof, then:
(a) Shelf Registration. The Company, at its cost, shall, as
promptly as practicable, file with the SEC a Registration Statement for an
offering to be made on a continuous basis pursuant to Rule 415 covering all of
the Registrable Debentures (the "Shelf Registration Statement"). If the
Company shall not have filed an Exchange Offer Registration Statement, the
Company shall use its diligent best efforts to file with the SEC the Shelf
Registration Statement as promptly as practicable, but no later than 30 days
from the delivery of the Shelf Notice. The Shelf Registration Statement shall
be on Form S-3 or another appropriate form permitting registration of such
Registrable Debentures for resale by Holders in the manner or manners
designated by them (including, without limitation, one or more underwritten
offerings). The Company shall not permit any securities other than the
Registrable Debentures to be included in the Shelf Registration Statement or
any Subsequent Shelf Registration Statement.
The Company shall use its diligent best efforts to cause the
initial Shelf Registration Statement to be declared effective under the
Securities Act by the 210th day after the Issue Date and to keep the Shelf
Registration Statement continuously effective under the Securities Act until
the date which is three years after its effective date, subject to extension
pursuant to the last paragraph of Section 5 hereof (the "Effectiveness
Period"), or such shorter period ending when (i) all Registrable Debentures
covered by the Shelf Registration Statement have been sold in the manner set
forth and as contemplated in the initial Shelf Registration Statement or (ii)
a Subsequent Shelf Registration Statement covering all of the Registrable
Debentures has been declared effective under the Securities Act. The Company
will be permitted to suspend the use of the Prospectus which is part of the
Shelf Registration Statement for a period not to exceed 30 days in any
three-month period or two periods not to exceed an aggregate of 60 days in any
12-month period under certain circumstances relating to pending corporate
developments, public filing with the SEC and similar events
(b) Subsequent Shelf Registrations. If the initial Shelf
Registration Statement or any Subsequent Shelf Registration Statement ceases
to be effective for any reason at any time during the Effectiveness Period
(other than because of the sale of all of the securities registered
thereunder), the Company shall use all reasonable efforts to obtain the prompt
withdrawal of any order suspending the effectiveness thereof, and in any event
shall, within 30 days after such cessation of the effectiveness, amend the
Shelf Registration Statement in a manner to obtain the withdrawal of the order
suspending the effectiveness thereof, or file an additional "shelf"
Registration Statement pursuant to Rule 415 covering all of the Registrable
Debentures (a "Subsequent Shelf Registration Statement"). If a Subsequent
Shelf Registration Statement is filed, the Company shall use its best efforts
to cause the Subsequent Shelf Registration to be declared effective under the
Securities Act as soon as practicable after such filing and to keep such
Registration Statement continuously effective for a period equal to the number
of days in the Effectiveness Period less the aggregate number of days during
which the Shelf Registration Statement or any Subsequent Shelf Registration
Statement was previously continuously effective. As used hereinafter the term
"Shelf Registration Statement" means the Shelf Registration Statement and any
Subsequent Shelf Registration Statement.
(c) Supplements and Amendments. The Company shall promptly
supplement and amend the Shelf Registration Statement if required by the
rules, regulations or instructions applicable to the registration form used
for such Shelf Registration Statement, if required by the Securities Act, or
if reasonably requested by the Holders of a majority in aggregate principal
amount of the Registrable Debentures covered by such Registration Statement or
by any underwriter of such Registrable Debentures.
(d) Hold-Back Agreements
(1) Restrictions on Public Sale by Holders of Registrable
Debentures. Each Holder of Registrable Debentures whose Registrable
Debentures are covered by a Shelf Registration Statement filed pursuant
to this Section 3 (which Registrable Debentures are not being sold in the
underwritten offering described below) agrees, if requested (pursuant to
a timely written notice) by the Company or the managing underwriter or
underwriters in an underwritten offering, not to effect any public sale
or distribution of any of the Registrable Debentures or a similar
security of the Company, including a sale pursuant to Rule 144 or Rule
144A (except as part of such underwritten offering), during the period
beginning 20 days prior to, and ending 90 days after, the closing date
of each underwritten offering made pursuant to such Shelf Registration
Statement, to the extent timely notified in writing by the Company or by
the managing underwriter or underwriters; provided, however, that each
holder of Registrable Debentures shall be subject to the hold-back
restrictions of this Section 3(d)(1) only once during the term of this
Agreement.
The foregoing provisions shall not apply to any Holder if
such Holder is prevented by applicable statute or regulation from
entering into any such agreement; provided, however, that any such
Holder shall undertake, in its request to participate in any such
underwritten offering, not to effect any public sale or distribution of
the class of securities covered by such Shelf Registration Statement
(except as part of such underwritten offering) during such period unless
it has provided 30 days' prior written notice of such sale or
distribution to the Company or the managing underwriter or underwriters,
as the case may be.
(2) Restrictions on the Company and Others. The Company agrees
(A) not to effect any public or private sale or distribution (including,
without limitation, a sale pursuant to Regulation D under the Securities
Act) of any securities the same as or similar to those covered by a
Shelf Registration Statement filed pursuant to this Section 3, or any
securities convertible into or exchangeable or exercisable for such
securities, during the 10 days prior to, and during the 90-day period
beginning on, the commencement of an underwritten public distribution of
Registrable Debentures, where the managing underwriter or underwriters
so requests; (B) to include in any agreements entered into by the
Company on or after the date of this Agreement (other than any
underwriting agreement relating to a public offering registered under
the Securities Act) pursuant to which the Company issues or agrees to
issue securities the same as or similar to the Debentures a provision
that each holder of such securities that are the same as or similar to
Debentures issued at any time on or after the date of this Agreement
agrees not to effect any public or private sale or distribution, or
request or demand the registration, of any such securities (or any
securities convertible into or exchangeable or exercisable for such
securities) during the period referred to in clause (A) of this Section
3(d)(2), including any sale pursuant to Rule 144 or Rule 144A; and (C)
not to grant or agree to grant any "piggy-back registration" or other
similar rights to any holder of the Company's or any of their respective
subsidiaries' securities issued on or after the date of this Agreement
with respect to any Registration Statement.
4. Liquidated Damages
(a) The Company and the Initial Purchasers agree that the
Holders of Debentures will suffer damages if the Company fails to fulfill its
obligations under Section 2 or Section 3 hereof and that it would not be
feasible to ascertain the extent of such damages with precision. Accordingly,
the Company agrees to pay to each Holder of Debentures liquidated damages
("Liquidated Damages"), accruing after the occurrence of a Registration
Default (as defined below) in the manner set forth below, at a rate per annum
equal to 0.5% of the principal amount of Debentures held by such Holder. Each
event referred to in clauses (i) through (iii) below will constitute a
"Registration Default" and each such event shall be given independent effect:
(i) if the Exchange Offer Registration Statement has not
been filed on or prior to the 90th calendar day following the
Issue Date and a Shelf Notice has not been delivered with respect
to all Debentures eligible for exchange in the Exchange Offer on
or prior to such 90th calendar day, then commencing on the 91st day
after the Issue Date, the Company shall pay Liquidated Damages
over and above the accrued interest on the Debentures;
(ii) if the Exchange Offer Registration Statement is not
declared effective by the SEC on or prior to the 180th calendar
day following the Issue Date and a Shelf Notice has not been
delivered with respect to all Debentures eligible for exchange in
the Exchange Offer on or prior to such 180th calendar day, then
commencing on the 181st day after the Issue Date, the Company
shall pay Liquidated Damages on the Debentures to be exchanged for
Exchange Debentures included or which should have been included in
such Exchange Offer Registration Statement over and above the
accrued interest on the Debentures; and
(iii) if (A) the Exchange Offer is not consummated on or
prior to the 210th calendar day following the Issue Date and a
Shelf Notice has not been delivered with respect to all Debentures
eligible for exchange in the Exchange Offer on or prior to such
210th calendar day, (B) the Shelf Registration Statement is not
declared effective on or prior to the 210th calendar day following
the Issue Date or (C) if applicable, the Shelf Registration
Statement has been declared effective and ceases to be effective
(except as specifically permitted therein) without being succeeded
immediately by an additional registration statement filed and
declared effective, then commencing on the day immediately
following the date of such Registration Default, the Company shall
pay Liquidated Damages over and above the accrued interest on the
Debentures;
provided, however, that (1) upon the filing of the Exchange Offer Registration
Statement or the delivery of a Shelf Notice with respect to all Debentures
eligible for exchange in the Exchange Offer (in the case of clause (i) of this
Section 4(a)), (2) upon the effectiveness of the Exchange Offer Registration
Statement or the delivery of a Shelf Notice with respect to all Debentures
eligible for exchange in the Exchange Offer (in the case of clause (ii) of
this Section 4(a)), or (3) upon the consummation of the Exchange Offer or the
delivery of a Shelf Notice with respect to all Debentures eligible for
exchange in the Exchange Offer (in the case of clause (iii)(A) of this Section
4(a)), or upon the effectiveness of the Shelf Registration Statement (in the
case of clause (iii)(B) of this Section 4(a)), or upon the effectiveness of
the Shelf Registration Statement which had ceased to remain effective (except
as specifically permitted therein) without being succeeded immediately by an
additional registration statement filed and declared effective (in the case
of clause (iii)(C) of this Section 4(a)), Liquidated Damages on the Debentures
as a result of such clause (or the relevant subclause thereof), as the case
may be, shall cease to accrue; and provided further, that no Liquidated
Damages shall accrue with respect to any Debenture (i) subsequent to the time
of the consummation of the Exchange Offer with respect to such Debenture, or
(ii) at any time that a Shelf Registration Statement is available with respect
to such Debenture. Notwithstanding the foregoing, the Company shall not be
required to pay Liquidated Damages with respect to the Debentures of a Holder
if the applicable Registration Default arises from the Company's failure to
file, or cause to become effective, a Shelf Registration Statement within the
time periods specified in this Section 4 by reason of the failure of such
Holder to provide such information as (i) the Company may reasonably request,
with reasonable prior written notice, for use in the Shelf Registration
Statement or any Prospectus included therein to the extent the Company
reasonably determines that such information is required to be included therein
by applicable law, (ii) the NASD or the SEC may request in connection with
such Shelf Registration Statement or (iii) is required to comply with the
agreements of such Holder as contained in the penultimate paragraph of Section
5 to the extent compliance thereof is necessary for the Shelf Registration
Statement to be declared effective. Notwithstanding anything contained
herein, (x) no Liquidated Damages shall accrue on Exchange Debentures with
respect to periods following the issuance thereof upon exchange for
Debentures, and (y) no Liquidated Damages shall accrue on Private Exchange
Debentures.
(b) The Company shall notify the Trustee within one business day
after each Registration Default (an "Event Date"). Any amounts of Liquidated
Damages due pursuant to (a)(i), (a)(ii) or (a)(iii) of this Section 4 on any
Debenture or any Exchange Debenture issued in exchange therefor will be
payable in cash on each date for the payment of interest on such Debenture or
such Exchange Debenture (to the Person entitled to receive the payment of
interest payable on such Debenture or Exchange Debenture on such date),
commencing with the first such date occurring after any such Liquidated
Damages commence to accrue. Any such Liquidated Damages will be paid by the
Company to the Holder of Registered Global Securities (as defined in the
Indenture) by wire transfer of same day funds and to Holders of certificated
Securities by wire transfer to the accounts specified by them or by mailing
checks to their registered addresses if no such accounts have been specified.
Following the cure of all Registration Defaults, the accrual of Liquidated
Damages will cease.
5. Registration Procedures
In connection with the filing of any Registration Statement
pursuant to Sections 2 or 3 hereof, the Company shall effect such
registrations to permit the sale of the securities covered thereby in
accordance with the intended method or methods of disposition thereof, and
pursuant thereto and in connection with any Registration Statement filed by
the Company hereunder the Company shall:
(a) Prepare and file with the SEC, a Registration Statement or
Registration Statements as prescribed by, and within the time periods
specified by, Sections 2 or 3 hereof, and use its diligent best efforts to
cause each such Registration Statement to become effective and remain
effective as provided herein; provided, however, that, if (1) such filing is
pursuant to Section 3 hereof, or (2) a Prospectus contained in an Exchange
Offer Registration Statement filed pursuant to Section 2 hereof is required to
be delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Debentures during the Applicable Period, before filing
any Registration Statement or Prospectus or any amendments or supplements
thereto, the Company shall furnish to and afford the Holders of the
Registrable Debentures covered by such Registration Statement or each such
Participating Broker-Dealer, as the case may be, one counsel selected by the
Holders of a majority in aggregate principal amount of the Registrable
Debentures (the "Holders' Counsel"), counsel for such Participating
Broker-Dealer and counsel for the managing underwriters, if any, a reasonable
opportunity to review copies of all such documents (including copies of any
documents to be incorporated by reference therein and all exhibits thereto)
proposed to be filed (in each case at least five business days prior to such
filing, or such later date as is reasonable under the circumstances). The
Company shall not file any Registration Statement or Prospectus or any
amendments or supplements thereto if the Holders of a majority in aggregate
principal amount of the Registrable Debentures covered by such Registration
Statement and the Holders' Counsel, or any such Participating Broker-Dealer
and its counsel, as the case may be, or the managing underwriters, if any,
shall reasonably object.
(b) Prepare and file with the SEC such amendments and
post-effective amendments to each Shelf Registration Statement or Exchange
Offer Registration Statement, as the case may be (including any documents to
be incorporated by reference therein and all exhibits thereto), as may be
necessary to keep such Registration Statement continuously effective for the
Effective Period or the Applicable Period, as the case may be; cause the
related Prospectus to be supplemented by any Prospectus supplement required by
applicable law, and as so supplemented to be filed pursuant to Rule 424 (or
any similar provisions then in force) promulgated under the Securities Act;
prior to making any amendment or supplement to such Registration Statement or
such Prospectus or filing any document incorporated by reference therein, to
furnish a copy thereof to the Initial Purchasers and counsel to the Initial
Purchasers and obtain the consent of the Initial Purchasers to such amendment,
supplement or filing, and comply with the provisions of the Securities Act and
the Exchange Act applicable to it with respect to the disposition of all
securities covered by such Registration Statement as so amended or in such
Prospectus as so supplemented and with respect to the subsequent resale of any
securities being sold by a Participating Broker-Dealer covered by any such
Prospectus. The Company shall be deemed not to have used its diligent best
efforts to keep a Registration Statement effective during the Applicable
Period if it voluntarily takes any action that would result in selling Holders
of the Registrable Debentures covered thereby or Participating Broker-Dealers
seeking to sell Exchange Debentures not being able to sell such Registrable
Debentures or such Exchange Debentures during that period unless (i) such
action is required by applicable law or (ii) such action is taken by the
Company in good faith and for valid business reasons (not including avoidance
of the Company's obligations hereunder), including the acquisition or
divestiture of assets.
(c) If (1) a Shelf Registration Statement is filed pursuant to
Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Debentures during the Applicable Period, notify the
selling Holders of Registrable Debentures and Holders' Counsel, or each such
Participating Broker-Dealer and their counsel, as the case may be, and the
managing underwriters, if any, promptly (but in any event within two business
days), (i) when a Prospectus or any Prospectus supplement or post-effective
amendment (including any documents to be incorporated by reference therein and
all exhibits thereto) has been filed, and, with respect to a Registration
Statement or any post-effective amendment, when the same has become effective
under the Securities Act (including in such notice a written statement that
any Holder may, upon request, obtain, at the sole expense of the Company, one
conformed copy of such Registration Statement or post-effective amendment
including financial statements and schedules, documents incorporated or deemed
to be incorporated by reference and exhibits), (ii) of the issuance by the SEC
of any stop order suspending the effectiveness of a Registration Statement or
of any order preventing or suspending the use of any preliminary prospectus or
the initiation of any proceedings for that purpose, (iii) if at any time when
a prospectus is required by the Securities Act to be delivered in connection
with sales of the Registrable Debentures or resales of Exchange Debentures by
Participating Broker-Dealers the representations and warranties of the Company
contained in any agreement (including any underwriting agreement),
contemplated by Section 5(n) hereof, to the knowledge of the Company, cease to
be true and correct in all material respects, (iv) of the receipt by the
Company of any notification with respect to the suspension of the qualification
or exemption from qualification of a Registration Statement or any of the
Registrable Debentures or the Exchange Debentures to be sold by any
Participating Broker-Dealer for offer or sale in any jurisdiction, or the
initiation or threatening of any proceeding for such purpose, (v) of the
happening of any event, or any information becoming known that makes any
statement made in such Registration Statement or related Prospectus or any
document incorporated or deemed to be incorporated therein by reference untrue
in any material respect or that requires the making of any changes in or
amendments or supplements to such Registration Statement, Prospectus or
documents so that, in the case of the Registration Statement, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, and that in the case of the Prospectus, it will not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, and
(vi) of the Company's determination that a post-effective amendment to a
Registration Statement would be appropriate.
(d) If (1) a Shelf Registration Statement is filed pursuant to
Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Debentures during the Applicable Period, use its
reasonable best efforts to prevent the issuance of any order suspending the
effectiveness of a Registration Statement or of any order preventing or
suspending to use of a Prospectus or suspending the qualification (or
exemption from qualification) of any of the Registrable Debentures or the
Exchange Debentures to be sold by any Participating Broker-Dealer, for sale in
any jurisdiction, and, if any such order is issued, the use its best efforts to
obtain the withdrawal of any such order at the earliest possible moment.
(e) If a Shelf Registration Statement is filed pursuant to
Section 3 and if requested by the managing underwriter or underwriters (if
any), the Holders of a majority in aggregate principal amount of the
Registrable Debentures being sold in connection with an underwritten offering
or any Participating Broker-Dealer, (i) promptly incorporate in a prospectus
supplement or post-effective amendment such information as the managing
underwriter or underwriters (if any), their counsel, such Holders, Holders'
Counsel, any Participating Broker-Dealer or their counsel determine is
reasonably necessary to be included therein, (ii) make all required filings of
such prospectus supplement or such post-effective amendment as soon as
practicable after the Company has received notification of the matters to be
incorporated in such prospectus supplement or post-effective amendment, and
(iii) supplement or make amendments to such Registration Statement.
(f) If (1) a Shelf Registration Statement is filed pursuant to
Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Debentures during the Applicable Period, furnish to
each selling Holder of Registrable Debentures, Holders' Counsel and to each
such Participating Broker-Dealer who so requests and its counsel and each
managing underwriter, if any, at the sole expense of the Company, one
conformed copy of the Registration Statement or Registration Statements and
each post-effective amendment thereto, including financial statements and
schedules, and, if requested, all documents incorporated or deemed to be
incorporated therein by reference and all exhibits.
(g) If (1) a Shelf Registration Statement is filed pursuant to
Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Debentures during the Applicable Period, deliver to
each selling Holder of Registrable Debentures and Holders' Counsel, or each
such Participating Broker-Dealer and its counsel, as the case may be, and the
underwriters, if any, at the sole expense of the Company, as many copies of
the Prospectus or Prospectuses (including each form of preliminary prospectus)
and each amendment or supplement thereto and any documents incorporated by
reference therein as such Persons may reasonably request; and, subject to the
last paragraph of this Section 5, the Company hereby consents to the use of
such Prospectus and each amendment or supplement thereto by each of the
selling Holders of Registrable Debentures or each such Participating
Broker-Dealer, as the case may be, and the underwriters or agents, if any, and
dealers (if any), in connection with the offering and sale of the Registrable
Debentures covered by, or the sale by Participating Broker-Dealers of the
Exchange Debentures pursuant to, such Prospectus and any amendment or
supplement thereto.
(h) Prior to any public offering of Registrable Debentures or any
delivery of a Prospectus contained in the Exchange Offer Registration
Statement by any Participating Broker-Dealer who seeks to sell Exchange
Debentures during the Applicable Period, use its best efforts to cooperate
with the selling Holders of Registrable Debentures and Holders' Counsel or
each such Participating Broker-Dealer and its counsel, as the case may be, the
managing underwriter or underwriters, if any, and their counsel in connection
with the registration or qualification (or exemption from such registration or
qualification) of such Registrable Debentures for offer and sale under the
securities or Blue Sky laws of such jurisdictions within the United States as
any selling Holder, Participating Broker-Dealer, or the managing underwriter
or underwriters reasonably request; provided, however, that where Exchange
Debentures held by Participating Broker-Dealers or Registrable Debentures are
offered other than through an underwritten offering, the Company agrees to
cause the Company's counsel to perform Blue Sky investigations and file
registrations and qualifications required to be filed pursuant to this Section
5(h); keep each such registration or qualification (or exemption therefrom)
effective during the period such Registration Statement is required to be kept
effective and do any and all other acts or things reasonably necessary or
advisable to enable the disposition in such jurisdictions of the Exchange
Debentures held by Participating Broker-Dealers or the Registrable Debentures
covered by the applicable Registration Statement.
(i) If a Shelf Registration Statement is filed pursuant to
Section 3 hereof, cooperate with the selling Holders of Registrable Debentures
and the managing underwriter or underwriters, if any, to facilitate the timely
preparation and delivery of certificates representing Registrable Debentures to
be sold, which certificates shall not bear any restrictive legends and shall
be in a form eligible for deposit with The Depository Trust Company or its
nominee; and enable such Registrable Debentures to be in such denominations
and registered in such names as the managing underwriter or underwriters, if
any, or Holders may request.
(j) Use its best efforts to cause the Registrable Debentures
covered by the Registration Statement to be registered with or approved by
such other governmental agencies or authorities as may be reasonably necessary
to enable the seller or sellers thereof or the underwriter or underwriters, if
any, to consummate the disposition of such Registrable Debentures, except as
may be required solely as a consequence of the nature of such selling Holder's
business, in which case the Company will cooperate in all reasonable respects
with the filing of such registration statement and the granting of such
approvals; provided, however, that the Company shall not be required (A) to
qualify generally to do business in any jurisdiction where it is not then so
qualified, (B) to take any action that would subject it to general service of
process in any such jurisdiction where it is not then so subject or (C) to
subject itself to taxation in excess of a nominal dollar amount in any such
jurisdiction where it is not then so subject.
(k) If (1) a Shelf Registration Statement is filed pursuant to
Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Debentures during the Applicable Period, upon the
occurrence of any event contemplated by paragraph 5(c)(v) or 5(c)(vi) hereof,
as promptly as practicable prepare and (subject to Section 5(a) hereof) file
with the SEC, at the sole expense of the Company, a supplement or
post-effective amendment to the Registration Statement or a supplement to the
related Prospectus or any document incorporated or deemed to be incorporated
therein by reference, or file any other required document so that, as
thereafter delivered to the purchasers of the Registrable Debentures being
sold thereunder or to the purchasers of the Exchange Debentures to whom such
Prospectus will be delivered by a Participating Broker-Dealer, any such
Prospectus will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
(l) Use its best efforts to cause the Registrable Debentures
covered by a Registration Statement or the Exchange Debentures, as the case
may be, to be rated with the appropriate rating agencies, if so requested by
the Holders of a majority in aggregate principal amount of Registrable
Debentures covered by such Registration Statement or the Exchange Debentures,
as the case may be, or the managing underwriter or underwriters, if any.
(m) Prior to the effective date of the first Registration
Statement relating to the Registrable Debentures, (i) provide the Trustee with
certificates for the Registrable Debentures in a form eligible for deposit
with The Depository Trust Company and (ii) provide a CUSIP number for the
Registrable Debentures.
(n) In connection with any underwritten offering of Registrable
Debentures pursuant to a Shelf Registration Statement, enter into an
underwriting agreement as is customary in underwritten offerings of debt
securities similar to the Debentures and take all such other actions as are
reasonably requested by the managing underwriter or underwriters in order to
expedite or facilitate the registration or the disposition of such Registrable
Debentures and, in such connection, (i) make such representations and
warranties to, and covenants with, the underwriters with respect to the
business of the Company and its subsidiaries (including any acquired business,
properties or entity, if applicable) and the Registration Statement, Prospectus
and documents, if any, incorporated or deemed to be incorporated by reference
therein, in each case, as are customarily made by issuers to underwriters in
underwritten offerings of corporate debt securities, and confirm the same in
writing if and when requested; (ii) use reasonable best efforts to obtain the
written opinions of counsel to the Company and written updates thereof in
form, scope and substance reasonably satisfactory to the managing underwriter
or underwriters, addressed to the underwriters covering the matters
customarily covered in opinions requested in underwritten offerings and such
other matters as may be reasonably requested by the managing underwriter or
underwriters; (iii) use reasonable best efforts to obtain "cold comfort"
letters and updates thereof in form, scope and substance reasonably
satisfactory to the managing underwriter or underwriters from the independent
certified public accountants of the Company (and, if necessary, any other
independent certified public accountants of any subsidiary of the Company or
of any business acquired by the Company for which financial statements and
financial data are, or are required to be, included or incorporated by
reference in the Registration Statement, addressed to each of the
underwriters, such letters to be in customary form and covering matters of the
type customarily covered in "cold comfort" letters in connection with
underwritten offerings and such other matters as reasonably requested by the
managing underwriter or underwriters as permitted by the Statement on Auditing
Standards No. 72 of Auditing Standards Board of the American Institute of
Certified Public Accountants, or any successor statement; and (iv) if an
underwriting agreement is entered into, the same shall contain indemnification
provisions and procedures no less favorable than those set forth in Section 7
hereof (or such other provisions and procedures acceptable to Holders of a
majority in aggregate principal amount of Registrable Debentures covered by
such Registration Statement and the managing underwriter or underwriters or
agents) with respect to all parties to be indemnified pursuant to said
Section. The above shall be done at each closing under such underwriting
agreement, or as and to the extent required thereunder.
(o) If (1) a Shelf Registration Statement is filed pursuant to
Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Debentures during the Applicable Period, make available
for inspection by any selling Holder of such Registrable Debentures being
sold, or each such Participating Broker-Dealer, as the case may be, any
underwriter participating in any such disposition of Registrable Debentures,
if any, and any attorney, accountant or other agent retained by any such
selling Holder or each such Participating Broker-Dealer, as the case may be,
or underwriter (collectively, the "Inspectors"), at the offices where normally
kept, during reasonable business hours, all financial and other records,
pertinent corporate documents and instruments of the Company and its
subsidiaries (collectively, the "Records") as shall be reasonably necessary to
enable them to exercise any applicable due diligence responsibilities, and
cause the officers, directors and employees of the Company and its
subsidiaries to supply all information reasonably requested by any such
Inspector in connection with such Registration Statement; provided, however,
that all information shall be kept confidential by each such Inspector, except
to the extent that (i) the disclosure of such Records is necessary to avoid or
correct a misstatement or omission in such Registration Statement or
Prospectus, (ii) the release of such Records is ordered pursuant to a subpoena
or other order from a court of competent jurisdiction, (iii) disclosure of
such information is, in the opinion of counsel for any Inspector, necessary or
advisable in connection with any action, claim, suit or proceeding, directly
or indirectly, involving or potentially involving such Inspector and arising
out of, based upon, relating to, or involving this Agreement, or any
transactions contemplated hereby or arising hereunder; provided, however, that
prior notice shall be provided as soon as practicable to the Company of the
potential disclosure of any information by such Inspector pursuant to clause
(ii) or this clause (iii) to permit the Company to obtain a protective order
(or waive the provisions of this paragraph (o)) and that such Inspector shall
take such actions as are reasonably necessary to protect the confidentiality
of such information to the extent such action is otherwise not inconsistent
with, an impairment of or in derogation of the rights and interests of the
Holders or any Inspector, or (iv) the information in such Records has been
made generally available to the public by the Company. Each selling Holder of
such Registrable Securities and each such Participating Broker-Dealer will be
required to agree that information obtained by it as a result of such
inspections shall be deemed confidential, shall be used only for due diligence
purposes pursuant to this Section 5(o) and shall not be used by it as the
basis for any market transactions in the securities of the Company unless and
until such information is generally available to the public. Each selling
Holder of such Registrable Debentures and each such Participating
Broker-Dealer will be required to further agree that it will, upon learning
that disclosure of such Records is sought in a court of competent
jurisdiction, give notice to the Company and allow the Company to undertake
appropriate action to prevent disclosure of the Records deemed confidential at
the Company's sole expense.
(p) Provide an indenture trustee for the Registrable Debentures
or the Exchange Debentures, as the case may be, and cause the Indenture or the
trust indenture provided for in Section 2(a) hereof, as the case may be, to be
qualified under the TIA not later than the effective date of the Exchange Offer
or the first Registration Statement relating to the Registrable Debentures;
and in connection therewith, cooperate with the trustee under any such
indenture and the Holders of the Registrable Debentures, to effect such
changes to such indenture as may be required for such indenture to be so
qualified in accordance with the terms of the TIA; and execute, and use its
reasonable best efforts to cause such trustee to execute, all documents as may
be required to effect such changes, and all other forms and documents required
to be filed with the SEC to enable such indenture to be so qualified in a
timely manner.
(q) Comply with all applicable rules and regulations of the SEC
and make generally available to its 1
securityholders earning statements satisfying the provisions of Section 11(a)
of the Securities Act and Rule 158 thereunder (or any similar rule promulgated
under the Securities Act) no later than 45 days after the end of any 12-month
period (or 90 days after the end of any 12-month period if such period is a
fiscal year) (i) commencing at the end of any fiscal quarter in which
Registrable Debentures are sold to underwriters in a firm commitment or best
efforts underwritten offering and (ii) if not sold to underwriters in such an
offering, commencing on the first day of the first fiscal quarter of the
Company after the effective date of a Registration Statement, which statements
shall cover said 12-month periods.
(r) Upon consummation of an Exchange Offer or a Private
Exchange, obtain an opinion of counsel to the Company, in a form customary for
underwritten transactions, addressed to the Trustee for the benefit of all
Holders of Registrable Debentures participating in the Exchange Offer or the
Private Exchange, as the case may be, that the Exchange Debentures or Private
Exchange Debentures, as the case may be, and the related indenture constitute
legal, valid and binding obligations of the Company, enforceable against the
Company in accordance with their respective terms, subject to customary
exceptions and qualifications.
(s) If an Exchange Offer or a Private Exchange is to be
consummated, upon delivery of the Registrable Debentures by Holders to the
Company (or to such other Person as directed by the Company) in exchange for
the Exchange Debentures or the Private Exchange Debentures, as the case may
be, the Company shall mark, or cause to be marked, on such Registrable
Debentures that such Registrable Debentures are being cancelled in exchange
for the Exchange Debentures or the Private Exchange Debentures, as the case
may be; in no event shall such Registrable Debentures be marked as paid or
otherwise satisfied.
(t) Cooperate with each seller of Registrable Debentures covered
by any Registration Statement, Holders' Counsel and each underwriter, if any,
participating in the disposition of such Registrable Debentures and its
counsel in connection with any filings required to be made with the National
Association of Securities Dealers, Inc. (the "NASD").
(u) Use its diligent best efforts to take all other steps
necessary or advisable to effect the registration of the Exchange Debentures
and/or Registrable Debentures covered by a Registration Statement contemplated
hereby.
The Company may require each seller of Registrable Debentures as
to which any registration is being effected to furnish to the Company such
information regarding such seller and the distribution of such Registrable
Debentures as the Company may, from time to time, reasonably request. The
Company may exclude from such registration the Registrable Debentures of any
seller who fails to furnish such information within a reasonable time after
receiving such request. Each seller as to which any registration pursuant to
a Shelf Registration Statement is being effected agrees to furnish promptly to
the Company all information required to be disclosed in order to make the
information previously furnished to the Company by such seller not materially
misleading.
Each Holder of Registrable Debentures and each Participating
Broker-Dealer agrees by acquisition of such Registrable Debentures or Exchange
Debentures to be sold by such Participating Broker-Dealer, as the case may be,
that, upon actual receipt of any notice from the Company of the happening of
any event of the kind described in Section 5(c)(ii), 5(c)(iv), 5(c)(v),
5(c)(vi) hereof, such Holder will forthwith discontinue disposition of such
Registrable Debentures covered by such Registration Statement or Prospectus or
Exchange Debentures to be sold by such Holder or Participating Broker-Dealer,
as the case may be, until such Holder's or Participating Broker-Dealer's
receipt of the copies of the supplemented or amended Prospectus contemplated
by Section 5(k) hereof, or until it is advised in writing (the "Advice") by
the Company that the use of the applicable Prospectus may be resumed, and has
received copies of any amendments or supplements thereto and, if so directed
by the Company, such Holder or Participating Broker-Dealer, as the case may
be, will deliver to the Company all copies, other than permanent file copies,
then in such Holder's or Participating Broker-Dealer's possession, of the
Prospectus covering such Registrable Securities current at the time of receipt
of such notice. In the event the Company shall give any such notice, each of
the Effectiveness Period and the Applicable Period shall be extended by the
number of days during such periods from and including the date of the giving
of such notice to and including the date when each seller of Registrable
Debentures covered by such Registration Statement or Exchange Debentures to be
sold by such Participating Broker-Dealer, as the case may be, shall have
received (x) the copies of the supplemented or amended Prospectus contemplated
by Section 5(k) hereof or (y) the Advice.
6. Registration Expenses
(a) All fees and expenses incident to the performance of or
compliance with this Agreement by the Company shall be borne by the Company
whether or not the Exchange Offer or a Shelf Registration Statement is filed
or becomes effective, including, without limitation, (i) all registration and
filing fees (including, without limitation, (A) fees with respect to filings
required to be made with the NASD in connection with an underwritten offering
and (B) fees and expenses of compliance with state securities or Blue Sky laws
(including, without limitation, reasonable fees and disbursements of counsel in
connection with Blue Sky qualifications of the Registrable Debentures or
Exchange Debentures and determination of the eligibility of the Registrable
Debentures or Exchange Debentures for investment under the laws of such
jurisdictions (x) where the holders of Registrable Debentures are located, in
the case of the Exchange Debentures, or (y) as provided in Section 5(h) hereof,
in the case of Registrable Debentures or Exchange Debentures to be sold by a
Participating Broker-Dealer during the Applicable Period)), (ii) printing
expenses, including, without limitation, expenses of printing certificates for
Registrable Debentures or Exchange Debentures in a form eligible for deposit
with The Depository Trust Company and of printing prospectuses if the printing
of prospectuses is requested by the managing underwriter or underwriters, if
any, or by the Holders of a majority in aggregate principal amount of the
Registrable Debentures included in any Registration Statement or in respect of
Registrable Debentures or Exchange Debentures to be sold by any Participating
Broker-Dealer during the Applicable Period, as the case may be, (iii)
messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel for the Company and reasonable fees and disbursements of Holders'
Counsel, (v) fees and disbursements of all independent certified public
accountants referred to in Section 5(n)(iii) hereof (including, without
limitation, the expenses of any special audit and "cold comfort" letters
required by or incident to such performance), (vi) rating agency fees, (vii)
Securities Act liability insurance, if the Company desires such insurance,
(viii) fees and expenses of all other Persons retained by the Company, (ix)
the expense of any annual audit, (x) the fees and expenses incurred in
connection with the listing of the securities to be registered on any
securities exchange, if applicable, and (xi) the expenses relating to
printing, word processing and distributing of all Registration Statements,
underwriting agreements, securities sales agreements, indentures and any other
documents necessary in order to comply with this Agreement.
(b) The Company shall reimburse the Holders of the Registrable
Debentures being registered in a Shelf Registration Statement for the
reasonable fees and disbursements of Holders' Counsel (in addition to
appropriate local counsel) and other out-of-pocket expenses of such Holders of
Registrable Debentures incurred in connection with the registration and sale
of the Registrable Debentures.
7. Indemnification
(a) In the event of a Shelf Registration Statement or in
connection with any delivery by any Participating Broker-Dealer who seeks to
sell Exchange Debentures during the Applicable Period, the Company agrees to
indemnify and hold harmless each Holder of Registrable Debentures and each
Participating Broker-Dealer selling Exchange Debentures during the Applicable
Period, and each Person, if any, who controls any such Person within the
meaning of the Securities Act (each, a "Participant"), from and against any
loss, claim, damage or liability, joint or several, and any action in respect
thereof (including, but not limited to, any loss, claim, damage, liability or
action relating to purchases and sales of Registrable Debentures or Exchange
Debentures), to which that Participant or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in any
preliminary Prospectus, the Registration Statement, the Prospectus, or the
Registration Statement or Prospectus as amended or supplemented, or (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
shall reimburse each such Participant promptly upon demand for any legal and
other expenses reasonably incurred as incurred by that Participant in
investigating or defending or preparing to defend against or appearing as a
third party witness in connection with any such loss, claim, damage, liability
or action; provided, however, that the Company shall not be liable in any such
case to the extent that any such loss, claim, damage, liability or action
arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in any preliminary Prospectus,
the Registration Statement or the Prospectus or any amendment thereof or
supplement thereto, made in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of any Participant
specifically for inclusion therein; and provided further that as to any
preliminary Prospectus this indemnity agreement shall not inure to the benefit
of any Participant on account of any loss, claim, damage, liability or action
arising from the sale of Debentures to any Person by that Participant if that
Participant failed to send or give a copy of the Prospectus (or the Prospectus
as amended or supplemented) to such Person, if required by law so to have been
delivered, at or prior to the written confirmation of the sale of the
Debentures to such Person, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such loss, claim,
damage or liability, unless such failure resulted from non-compliance by the
Company with Section 5(b) hereof. For purposes of the last proviso to the
immediately preceding sentence, the term "Prospectus" shall not be deemed to
include the documents incorporated or deemed incorporated therein by
reference, and no Participant shall be obligated to send or give any
supplement or amendment to any document incorporated by reference in any
preliminary Prospectus or the Prospectus to any Person other than a Person to
whom such Participant had delivered such incorporated document or documents in
response to a written request therefor. The foregoing indemnity agreement is
in addition to any liability which the Company may otherwise have to any
Participant.
(b) Each Participant severally, and not jointly, shall indemnify
and hold harmless the Company, each of its directors, each of its officers who
signed the Registration Statement, and each Person, if any, who controls the
Company within the meaning of the Securities Act, from and against any loss,
claim, damage or liability, joint or several, and any action in respect
thereof, to which the Company, or any such director or officer or controlling
Person may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
any untrue statement or alleged untrue statement of a material fact contained
in any preliminary Prospectus, the Registration Statement, the Prospectus or
the Registration Statement or Prospectus as amended or supplemented, or arises
out of, or is based upon, the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, but in each case only to the extent that
the untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of that Participant
specifically for inclusion therein, and shall reimburse the Company, or any
such director or officer or controlling Person promptly upon demand for any
legal and other expenses reasonably incurred by the Company or any such
director or officer or controlling Person in investigating or defending or
preparing to defend against, or appearing as a third party witness in
connection with, any such loss, claim, damage, liability or action. The
foregoing indemnity agreement is in addition to any liability which any
Participant may otherwise have to the Company or any such director, officer or
controlling Person.
(c) Promptly after receipt by an indemnified party under this
Section 7 of notice of any claim or the commencement of any action, the
indemnified party (the "Indemnified Person") shall, if a claim in respect
thereof is to be made against the indemnifying party (the "Indemnifying
Person") under this Section 7, notify the Indemnifying Person in writing of
the claim or the commencement of that action; provided, however, that the
failure to notify the Indemnifying Person shall not relieve it from its
obligations hereunder, except to the extent that the Indemnifying Person is
materially prejudiced by such failure to notify, or from any liability which
it may have to an Indemnified Person otherwise than under this Section 7. If
any such claim or action shall be brought against an Indemnified Person, and
it shall notify the Indemnifying Person thereof, the Indemnifying Person shall
be entitled to participate therein and, to the extent that it wishes, jointly
with any other similarly notified Indemnifying Person, to assume the defense
thereof with counsel reasonably satisfactory to the Indemnified Person. After
notice from the Indemnifying Person to the Indemnified Person of its election
to assume the defense of such claim or action, the Indemnifying Person shall
not be liable to the Indemnified Person under this Section 7 for any legal or
other expenses subsequently incurred by the Indemnified Person in connection
with the defense thereof other than reasonable investigation, provided,
however, that the Participants shall have the right to employ counsel to
represent them in an action arising out of any claim in respect of which
indemnity may be sought by the Participants against the Company under this
Section 7 if, in the reasonable judgment of the Participants, it is advisable
for the Participants to be represented by separate counsel, and in that event
the fees and expenses of such separate counsel shall be paid by the
Indemnifying Person. Except as provided above, it is understood that the
Indemnifying Person shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel) for all such
Indemnified Persons. The Indemnifying Person shall not be liable for any
settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the plaintiffs,
the Indemnifying Person agrees to indemnify the Indemnified Person from and
against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an Indemnified Person
shall have requested an Indemnifying Person to reimburse the Indemnified
Person for fees and expenses of counsel with respect to any proceeding, the
Indemnifying Person agrees that it shall be liable for any settlement of any
such proceeding effected without its consent if (i) such settlement is entered
into more than 30 days after receipt by such Indemnifying Person of the
aforesaid request and (ii) such Indemnifying Person shall not have reimbursed
the Indemnified Person in accordance with such request prior to the date of
such settlement.
(d) If the indemnification provided for in this Section 7 shall
be for any reason unavailable or insufficient to hold the Indemnified Person
harmless, then each Indemnifying Person, with respect to its obligations as
provided in Section 7(a) or 7(b), shall, in lieu of indemnifying such
Indemnified Person, contribute to the amount paid or payable by such
Indemnified Person as a result of such loss, claim, damage or liability, or
action in respect thereof, (i) in such proportion as shall be appropriate to
reflect the relative benefits received by the Company on the one hand and the
Participants on the other hand from the offering of the Debentures, or (ii) if
the allocation provided by clause (i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Company on the one hand and the Participants on the other hand with respect to
the statements or omissions which resulted in such loss, claim, damage or
liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company on
the one hand and any Participant on the other hand with respect to such
offering shall be deemed to be in the same proportion as the total net
proceeds from the sale of the Debentures (before deducting expenses) received
by the Company bear to the total discounts and commissions received by such
Participant with respect to such offering. The relative fault shall be
determined by reference to whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or any Participant, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and the
Participants agree that it would not be just and equitable if contributions
pursuant to this Section 7(d) were to be determined by pro rata allocation
(even if the Participants were treated as one entity for such purpose) or by
any other method of allocation which does not take into account the equitable
considerations referred to herein. The amount paid or payable by an
Indemnified Person as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section 7(d) shall be
deemed to include, for purposes of this Section 7(d) and subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such Indemnified Person in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 7(d), no
Participant shall be required to contribute any amount in excess of the amount
by which the total price at which the Debentures sold through such Participant
and distributed to the public was offered to the public exceeds the amount of
any damages which such Participant has otherwise paid or become liable to pay
by reason of any untrue or alleged untrue statement or omission or alleged
omission. No Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation. The Participants' obligations to contribute under this
Section 7(d) shall be several and not joint.
(e) The indemnity and contribution agreements contained in this
Section 7 will be in addition to any liability which the Indemnifying Persons
may otherwise have to the indemnified Persons referred to above.
8. Rules 144 and 144A
The Company covenants to file with Trustee, within 15 days after
the Company is required to file the same with the SEC, copies of the annual,
quarterly and current reports and of the information, documents and other
reports which the Company may be required to file with the SEC pursuant to
Section 13 or Section 15(d) of the Exchange Act. The Company further
covenants, for so long as any Registrable Debentures remain outstanding, to
make available to any Holder or beneficial owner of Registrable Debentures in
connection with any sale thereof and any prospective purchaser of such
Registrable Debentures from such Holder or beneficial owner, the information
required by Rule 144A(d)(4) under the Securities Act in order to permit
resales of such Registrable Debentures pursuant to Rule 144A, unless the
Company is then subject to Section 13 or 15(d) of the Exchange Act and reports
filed thereunder satisfy the information requirements of Rule 144A(d)(4) as
then in effect.
9. Underwritten Registrations
If any of the Registrable Debentures covered by any Shelf
Registration Statement are to be sold in an underwritten offering, the
investment banker or investment bankers and manager or managers that will
manage the offering will be selected by the Holders of a majority in aggregate
principal amount of such Registrable Debentures included in such offering and
reasonably acceptable to the Company.
No Holder of Registrable Debentures may participate in any
underwritten registration hereunder unless such Holder (a) agrees to sell such
Holder's Registrable Debentures on the basis provided in any underwriting
arrangements approved by the Persons entitled hereunder to approve such
arrangements and (b) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents required
under the terms of such underwriting arrangements.
10. Miscellaneous
(a) No Inconsistent Agreements. The Company has not, as of the
date hereof, and the Company shall not after the date of this Agreement, enter
into any agreement with respect to any of its securities that is inconsistent
with the rights granted to the Holders of Registrable Debentures in this
Agreement or otherwise conflicts with the provisions hereof. The rights
granted to the Holders hereunder do not in any way conflict with and are not
inconsistent with the rights granted to the holders of the Company's other
issued and outstanding securities under any such agreements. The Company has
not entered and will not enter into any agreement with respect to any of its
securities which will grant to any Person piggy-back registration rights with
respect to a Registration Statement.
(b) Adjustments Affecting Registrable Debentures. The Company
shall not, directly or indirectly, take any action with respect to the
Registrable Debentures as a class that would adversely affect the ability of
the Holders of Registrable Debentures to include such Registrable Debentures
in a registration undertaken pursuant to this Agreement.
(c) Amendments and Waivers. The provisions of this Agreement may
not be amended, modified or supplemented, and waivers or consents to
departures from the provisions hereof may not be given, otherwise than with
the prior written consent of (A) the Holders of not less than a majority in
aggregate principal amount of the then outstanding Registrable Debentures and
(B) in circumstances that would adversely affect the Participating
Broker-Dealers, the Participating Broker-Dealers holding not less than a
majority in aggregate principal amount of the Exchange Debentures held by all
Participating Broker-Dealers; provided, however, that Section 7 and this
Section 10(c) may not be amended, modified or supplemented without the prior
written consent of each Holder and each Participating Broker-Dealer (including
any person who was a Holder or Participating Broker-Dealer of Registrable
Debentures or Exchange Debentures, as the case may be, disposed of pursuant to
any Registration Statement). Notwithstanding the foregoing, a waiver or
consent to depart from the provisions hereof with respect to a matter that
relates exclusively to the rights of Holders of Registrable Debentures whose
securities are being sold pursuant to a Registration Statement and that does
not directly or indirectly affect, impair, limit or compromise the rights of
other Holders of Registrable Debentures may be given by Holders of at least a
majority in aggregate principal amount of the Registrable Debentures being
sold by such Holders pursuant to such Registration Statement.
(d) Notices. All notices and other communications (including
without limitation any notices or other communications to the Trustee)
provided for or permitted hereunder shall be made in writing by hand-delivery,
registered first-class mail, next-day air courier or facsimile:
(1) if to a Holder of the Registrable Debentures or any
Participating Broker-Dealer, at the most current address of such Holder
or Participating Broker-Dealer, as the case may be, set forth on the
records of the registrar under the Indenture, with a copy in like manner
to the Initial Purchasers as follows:
Lehman Brothers Inc.
3 World Financial Center
New York, New York 10285
Attention: Syndicate Department
Merrill Lynch Pierce, Fenner & Smith
Incorporated
World Financial Center - North Tower
New York, New York 10281
Attention: Cara I. Londin
with a copy to:
Lehman Brothers Inc.
3 World Financial Center
New York, New York 10285
Attention: Director of Litigation,
Office of the General
Counsel
and
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Facsimile No: (212) 455-2502
Attention: John B. Tehan, Esq.
(2) if to the Initial Purchasers, at the address specified in
Section 10(d)(1);
(3) if to the Company, at the addresses as follows:
Illinois Central Railroad Company
455 North Cityfront Plaza Drive
Chicago, Illinois 60611
Facsimile No: (312) 755-7839
Attention: President
with a copy to:
Davis Polk & Wardwell
450 Lexington Avenue
New York, New York 10017
Facsimile No: (212) 450-4800
Attention: Winthrop B. Conrad, Jr., Esq.
All such notices and communications shall be deemed to have been
duly given: when delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; one
business day after being timely delivered to a next-day air courier; and when
receipt is acknowledged by the addressee, if sent by facsimile.
Copies of all such notices, demands or other communications shall
be concurrently delivered by the Person giving the same to the Trustee at the
address and in the manner specified in such Indenture.
(e) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties hereto, the Holders and the Participating Broker-Dealers; provided,
however, that this Agreement shall not inure to the benefit of or be binding
upon a successor or assign of a Holder unless such successor or assign holds
Registrable Debentures.
(f) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
(g) Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
(h) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW. EACH OF THE PARTIES HERETO AGREES
TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.
(i) Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, illegal, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated, and
the parties hereto shall use their best efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would
have executed the remaining terms, provisions, covenants and restrictions
without including any of such that may be hereafter declared invalid, illegal,
void or unenforceable.
(j) Third Party Beneficiaries. Holders of Registrable Debentures
and Participating Broker-Dealers are intended third party beneficiaries of
this Agreement and this Agreement may be enforced by such Persons.
(k) Entire Agreement. This Agreement, together with the Purchase
Agreement and the Indenture, is intended by the parties as a final and
exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein and therein and any and all
prior oral or written agreements, representations, or warranties, contracts,
understanding, correspondence, conversations and memoranda between the Initial
Purchasers on the one hand and the Company on the other, or between or among
any agents, representatives, parents, subsidiaries, affiliates, predecessors
in interest or successors in interest with respect to the subject matter hereof
and thereof are merged herein and replaced hereby.
(l) Underwriting Agreement. Notwithstanding the provisions of
Sections 3(d), 5, 6 and 7, in the event of a Shelf Registration pursuant to
Section 3 hereof, to the extent that the Holders of Registrable Debentures
shall enter into an underwriting or similar agreement, which agreement contains
provisions covering one or more issues addressed in such Sections with
substantially similar effect, the provisions contained in such Sections
addressing such issue or issues shall be of no force or effect with respect to
the registration of securities being effected in connection with such
underwriting or similar agreement.
(m) Termination. This Agreement shall terminate and be of no
further force or effect when there shall not be any Registrable Debentures,
except that the provisions of Section 4, 6, 7 and Sections 10(h) and (j) shall
survive any such termination.
IN WITNESS WHEREOF, the parties have executed this Registration
Rights Agreement as of the date first written above.
ILLINOIS CENTRAL RAILROAD COMPANY
By: /s/ Dale W. Phillips
-----------------------------
Name: Dale W. Phillips
Title: Vice President and Chief
Financial Officer
LEHMAN BROTHERS INC.
By: /s/ Herbert H. McDade
----------------------------
Name: Herbert H. McDade
Title: Managing Director
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: /s/ William S. Susman
----------------------------
Name: William S. Susman
Title: Vice President
EXHIBIT 12
ILLINOIS CENTRAL RAILROAD COMPANY AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
($ in millions)
<TABLE>
<CAPTION>
Nine Months Ended
September 30, Years Ended December 31,
----------------------------------- -------------------------------------------------------------------
Pro-forma Pro-forma
Fixed Charge Coverage 1996 1996 1995 1995 1995 1994 1993 1992 1991
- --------------------- --------- ------- ------- --------- ------ ------ ------ ------ --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Income from continuing
operations before
income taxes and
cumulative effect of
accounting changes.... $159.9 $165.0 $166.7 $191.8 $198.3 $170.9 $148.6 $111.0 $ 96.0
Fixed charges.......... 40.1 35.0 31.5 48.6 42.1 45.2 49.9 61.1 75.9
Capitalized interest... (1.5) (1.5) (1.0) (1.3) (1.3) (1.4) (0.8) (0.6) (0.4)
------ ------ ------ ------ ------ ------ ------ ------ ------
Earnings base for
fixed charge ratio.... $198.5 $198.5 $197.2 $239.1 $239.1 $214.7 $197.7 $171.5 $171.5
====== ====== ====== ====== ====== ====== ====== ====== ======
Interest expense....... $ 28.6 $ 23.5 $ 22.4 $ 35.6 $ 29.1 $ 27.5 $ 33.1 $ 44.5 $ 59.2
Capitalized interest... 1.5 1.5 1.0 1.3 1.3 1.4 0.8 0.6 0.4
Portion of non-
capitalized lease
payments.............. 10.0 10.0 8.1 11.7 11.7 16.3 16.0 16.0 16.3
------ ------ ------ ------ ------ ------ ------ ------ ------
Fixed charges.......... $ 40.1 $ 35.0 $ 31.5 $ 48.6 $ 42.1 $ 45.2 $ 49.9 $ 61.1 $ 75.9
====== ====== ====== ====== ====== ====== ====== ====== ======
Ratio of earnings to
fixed charges......... 4.95 5.67 6.26 4.92 5.68 4.75 3.96 2.81 2.26
====== ====== ====== ====== ====== ====== ====== ====== ======
</TABLE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
ILLINOIS CENTRAL RAILROAD COMPANY
As independent public accountants, we hereby consent to the
incorporation by reference in this Registration Statement of our report
dated January 25, 1996 (except with respect to the matter discussed in Note
16, as to which the date is February 29, 1996), included in Illinois
Central Railroad Company's Form 10-K for the year ended December 31, 1995
and to all references to our Firm included in this Registration Statement.
/s/ Arthur Andersen LLP
Chicago, Illinois
December 18, 1996
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
ILLINOIS CENTRAL RAILROAD COMPANY
As independent public accountants, we hereby consent to the
incorporation by reference in this Registration Statement of our report
dated January 19, 1996 on the consolidated financial statements of CCP
Holdings, Inc. and its subsidiaries as of December 31, 1995 and 1994 and
for each of the years in the three year period ended December 31, 1995
incorporated by reference in Illinois Central Railroad Company's Current
Reports on Form 8-K dated May 15, 1996 (as amended by Amendment No. 1
thereto).
/s/ Arthur Andersen LLP
Chicago, Illinois
December 18, 1996
EXHIBIT 25
------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ----------
--------------------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
-------------------------------------------------------
Illinois Central Railroad Company
(Exact name of obligor as specified in its charter)
Delaware 36-2728842
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
445 North Cityfront Plaza Drive
Chicago, Illinois 60611-5504
(Address of principal executive offices) (Zip Code)
------------------------------------------------
$125,000,000 7.70% Debentures due 2096
(Title of the indenture securities)
------------------------------------------------
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority
to which it is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
Item 16.List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now in
effect, including the Organization Certificate and the Certificates of
Amendment dated February 17, 1969, August 31, 1977, December 31, 1980,
September 9, 1982, February 28, 1985, December 2, 1991 and July 10, 1996 (see
Exhibit 1 to Form T-1 filed in connection with Registration Statement No.
333-06249, which is incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996,
in connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being
contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to
Form T-1 filed in connection with Registration Statement No. 333-06249, which
is incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act
(see Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, a corporation organized and existing under
the laws of the State of New York, has duly caused this statement of
eligibility to be signed on its behalf by the undersigned, thereunto duly
authorized, all in the City of New York and State of New York, on the 18th day
of December, 1996.
THE CHASE MANHATTAN BANK
By /s/ R. J. Halleran
---------------------------
R. J. Halleran
Second Vice President
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business September 30, 1996, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin............................................ $ 11,095
Interest-bearing balances ................................... 4,998
Securities: ...................................................
Held to maturity securities.................................... 3,231
Available for sale securities.................................. 38,078
Federal Funds sold and securities purchased under
agreements to resell in domestic offices of the
bank and of its Edge and Agreement subsidiaries,
and in IBF's:
Federal funds sold........................................... 8,018
Securities purchased under agreements to resell.............. 731
Loans and lease financing receivables:
Loans and leases, net of unearned income $130,513
Less: Allowance for loan and lease losses 2,938
Less: Allocated transfer risk reserve ......... 27
-------
Loans and leases, net of unearned income,
allowance, and reserve....................................... 127,548
Trading Assets................................................. 48,576
Premises and fixed assets (including capitalized
leases)...................................................... 2,850
Other real estate owned........................................ 300
Investments in unconsolidated subsidiaries and
associated companies......................................... 92
Customer's liability to this bank on acceptances
outstanding.................................................. 2,777
Intangible assets.............................................. 1,361
Other assets................................................... 12,204
------
TOTAL ASSETS................................................... $261,859
========
LIABILITIES
Deposits
In domestic offices......... ................................ $80,163
Noninterest-bearing........................... $30,596
Interest-bearing.............................. 49,567
In foreign offices, Edge and Agreement subsidiaries,
and IBF's.................................................... 65,173
Noninterest-bearing........................... $ 3,616
Interest-bearing.............................. 61,557
Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and
of its Edge and Agreement subsidiaries, and in IBF's
Federal funds purchased...................................... 14,594
Securities sold under agreements to repurchase............... 14,110
Demand notes issued to the U.S. Treasury ...................... 2,200
Trading liabilities............................................ 30,136
Other Borrowed money:
With a remaining maturity of one year or less................ 16,895
With a remaining maturity of more than one year.............. 449
Mortgage indebtedness and obligations under capitalized
leases....................................................... 49
Bank's liability on acceptances executed and outstanding....... 2,764
Subordinated notes and debentures.............................. 5,471
Other liabilities.............................................. 13,997
TOTAL LIABILITIES.............................................. 246,001
Limited-Life Preferred stock and related surplus 550
EQUITY CAPITAL
Common stock................................................... 1,209
Surplus........................................................ 10,176
Undivided profits and capital reserves......................... 4,385
Net unrealized holding gains (Losses)
on available-for-sale securities............................... (481)
Cumulative foreign currency translation adjustments............ 19
TOTAL EQUITY CAPITAL........................................... 15,308
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TOTAL LIABILITIES, LIMITED-LIFE PREFERRED
STOCK AND EQUITY CAPITAL..................................... $261,859
=======
I, Joseph L. Sclafani, S.V.P. & Controller of the
above-named bank, do hereby declare that this Report of
Condition has been prepared in conformance with the in-
structions issued by the appropriate Federal regulatory
authority and is true to the best of my knowledge and
belief.
JOSEPH L. SCLAFANI
We, the undersigned directors, attest to the correctness
of this Report of Condition and declare that it has been
examined by us, and to the best of our knowledge and
belief has been prepared in conformance with the in-
structions issued by the appropriate Federal regulatory
authority and is true and correct.
WALTER V. SHIPLEY )
EDWARD D. MILLER )DIRECTORS
THOMAS G. LABRECQUE )
