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As filed with the Securities and Exchange Commission on August 29, 2000
Registration No. 333-43808
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
Pre-Effective Amendment No. 1 to
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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UnumProvident Corporation UnumProvident Financing Trust II
(Exact name of registrant as specified in its charter) UnumProvident Financing Trust III
Delaware (Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) Delaware
62-1598430 (State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification Number) Each Applied For
1 Fountain Square, (I.R.S. Employer Identification Number)
Chattanooga, Tennessee 37402, 1 Fountain Square,
(423) 755-1011 Chattanooga Tennessee 37402,
221 Congress Street, Portland, Maine 04122, (423) 755-1011
(207) 770-2211 (Address, including zip code, and telephone number,
(Address, including zip code, and telephone number, including area code, of the registrant's
including area code, of the registrant's principal executive offices)
principal executive offices)
</TABLE>
Susan N. Roth
Vice President, Corporate Secretary and Assistant General Counsel
UnumProvident Corporation
1 Fountain Square, Chattanooga, Tennessee 37402, (423) 755-1011
(Name, address, including zip code and telephone number, including area code,
of agent for service)
Copies to:
David E. Brown, Jr. Donald C. Walkovik
Alston & Bird llp Sullivan & Cromwell
601 Pennsylvania Avenue, N.W. 125 Broad Street
North Building, 11th Floor New York, New York 10004-2498
Washington, D.C. 20004 Phone: (212) 558-4000
Phone: (202) 756-3300 Facsimile: (212) 558-3588
Facsimile: (202) 756-3333
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Approximate date of commencement of proposed sale to public: From time to
time after this registration statement becomes effective as determined by
market conditions and other factors.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration number of the earlier effective
registration statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
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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 the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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PROSPECTUS
[LOGO of UnumProvident Corporation]
$1,000,000,000
UNUMPROVIDENT CORPORATION
SENIOR DEBT SECURITIES
SUBORDINATED DEBT SECURITIES
PREFERRED STOCK
DEPOSITARY SHARES
COMMON STOCK
WARRANTS
STOCK PURCHASE CONTRACTS
AND
STOCK PURCHASE UNITS
UNUMPROVIDENT FINANCING TRUST II
UNUMPROVIDENT FINANCING TRUST III
PREFERRED SECURITIES
AS FULLY AND UNCONDITIONALLY GUARANTEED
BY UNUMPROVIDENT CORPORATION
We will provide you with more specific terms of these securities in
supplements to this prospectus. You should read this prospectus and the
applicable prospectus supplement carefully before you invest.
We may offer these securities from time to time in amounts, at prices and
on other terms to be determined at the time of offering. The total offering
price of the securities offered to the public will be limited to
$1,000,000,000.
---------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
The date of this Prospectus is September 1, 2000.
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TABLE OF CONTENTS
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Page
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About This Prospectus.................................................... 1
Where You Can Find More Information...................................... 1
Forward-Looking Statements............................................... 2
UnumProvident Corporation................................................ 3
UnumProvident Trusts..................................................... 3
Use of Proceeds.......................................................... 4
Consolidated Ratios of Earnings to Fixed Charges and Earnings to Combined
Fixed Charges and Preferred Stock Dividends............................. 5
Description of Debt Securities........................................... 6
Description of Preferred Stock........................................... 21
Description of Depositary Shares......................................... 24
Description of Common Stock.............................................. 28
Description of Warrants.................................................. 31
Description of Stock Purchase Contracts and Stock Purchase Units......... 32
Description of Preferred Securities...................................... 33
Description of Trust Guarantees.......................................... 40
Effect of Obligations Under the Subordinated Debt Securities and the
Trust Guarantees........................................................ 43
Plan of Distribution..................................................... 43
Legal Matters............................................................ 44
Experts.................................................................. 44
</TABLE>
Notice to North Carolina residents: the Commissioner of Insurance for the
State of North Carolina has not approved or disapproved these securities, nor
has the Commissioner ruled upon the accuracy or adequacy of this document.
The laws of the various states prohibit any person or entity from directly
or indirectly acquiring 10% or more (5% or more in Alabama and Florida) of the
voting control of any domestic insurance holding company without approval of
the states' Commissioner of Insurance.
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ABOUT THIS PROSPECTUS
This document is called a prospectus and is part of a registration statement
that we filed with the SEC using a "shelf" registration or continuous offering
process. Under this shelf process, we may from time to time offer any
combination of the securities described in this prospectus in one or more
offerings up to a total dollar amount of $1,000,000,000.
This prospectus provides you with a general description of the securities we
may offer. Each time we sell securities, we will provide a prospectus
supplement containing specific information about the terms of the securities
being offered. A prospectus supplement may include a discussion of any risk
factors or other special considerations applicable to those securities or to
us. A prospectus supplement may also add, update or change information in this
prospectus. If there is any inconsistency between the information in this
prospectus and the applicable prospectus supplement, you should rely on the
information in the prospectus supplement. You should read both this prospectus
and any prospectus supplement together with additional information described
under the heading "WHERE YOU CAN FIND MORE INFORMATION" on page 1.
The registration statement containing this prospectus, including exhibits to
the registration statement, provides additional information about us and the
securities offered under this prospectus. The registration statement can be
read at the SEC web site or at the SEC offices mentioned under the heading
"WHERE YOU CAN FIND MORE INFORMATION" on page 1.
When acquiring any securities discussed in this prospectus, you should rely
only on the information provided in this prospectus and in the applicable
prospectus supplement, including the information incorporated by reference.
Neither we, nor any underwriters or agents, have authorized anyone to provide
you with different information. We are not offering the securities in any state
where the offer is prohibited. You should not assume that the information in
this prospectus, any prospectus supplement, or any document incorporated by
reference, is truthful or complete at any date other than the date mentioned on
the cover page of these documents.
We may sell securities to underwriters who will sell the securities to the
public on terms fixed at the time of sale. In addition, the securities may be
sold by us directly or through dealers or agents designated from time to time.
If we, directly or through agents, solicit offers to purchase the securities,
we reserve the sole right to accept and, together with any agents, to reject,
in whole or in part, any of those offers.
Any prospectus supplement will contain the names of the underwriters,
dealers or agents, if any, together with the terms of offering, the
compensation of those underwriters and the net proceeds to us. Any
underwriters, dealers or agents participating in the offering may be deemed
"underwriters" within the meaning of the Securities Act of 1933.
Unless otherwise mentioned or unless the context requires otherwise, all
references in this prospectus to "we," "us," "our," or similar references mean
UnumProvident Corporation and its subsidiaries.
Unless otherwise stated, currency amounts in this prospectus and any
prospectus supplement are stated in United States dollars ("$").
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms. Our SEC filings are also available
to the public at the SEC's web site at http://www.sec.gov. The address of the
SEC's web site is provided for the information of prospective investors and not
as an active link. You can also inspect reports, proxy statements and other
information about us at the offices of the New York Stock Exchange, 20 Broad
Street, New York, New York.
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The SEC allows us to "incorporate by reference" into this prospectus the
information in documents we file with the SEC, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is considered to be a part of this
prospectus and should be read with the same care. When we update the
information contained in documents that have been incorporated by reference, by
making future filings with the SEC, the information incorporated by reference
in this prospectus is considered to be automatically updated and superceded. In
other words, in all cases, if you are considering whether to rely on
information contained in this prospectus or information incorporated by
reference into this prospectus, you should rely on the information contained in
the document that was filed later. We incorporate by reference the documents
listed below and any additional documents we file with the SEC in the future
under Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of
1934 until our offering is completed:
. Annual Report on Form 10-K for the year ended December 31, 1999; and
. Quarterly Reports on Form 10-Q for the periods ending March 31, 2000,
and June 30, 2000.
You may request a copy of these filings, at no cost, by writing to or
telephoning us at either of the following addresses:
Corporate Relations
UnumProvident Corporation
2211 Congress Street 1 Fountain Square
Portland, Maine 04122 Chattanooga, Tennessee 37402
(207) 770-4361 (423) 755-8996
We have not included or incorporated by reference in this prospectus any
separate financial statements of UnumProvident Financing Trust II or
UnumProvident Financing Trust III, which we will refer to as the trusts. We do
not believe that these financial statements would provide holders of preferred
securities with any important information for the following reasons:
. we will own all of the voting securities of the trusts;
. the trusts do not and will not have any independent operations other
than to issue securities and to purchase and hold our junior
subordinated debt securities; and
. we are fully and unconditionally guaranteeing the obligations of the
trusts as described in this prospectus.
Although the trusts would normally be required to file information with the
SEC on an ongoing basis, we expect the SEC to exempt the trusts from filing
this information for as long as we continue to file our information with the
SEC.
FORWARD-LOOKING STATEMENTS
This prospectus and accompanying prospectus supplements contain or
incorporate statements that are "forward-looking" within the meaning of the
Private Securities Litigation Reform Act of 1995. Those statements can be
identified by the use of forward-looking language such as "may," "should,"
"believes," "expects," "anticipates," "estimates," "intends," "projects,"
"goals," "objectives," or other similar expressions. Our actual results,
performance or achievements could be significantly different from the results
expressed in, or implied by, those forward-looking statements. Those statements
are subject to certain risks and uncertainties, including but not limited to,
certain risks described in the prospectus supplement accompanying this
prospectus or other documents incorporated by reference. When considering those
forward-looking statements, you should keep in mind these risks, uncertainties
and other cautionary statements made in this
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prospectus and the prospectus supplements. You should not place undue reliance
on any forward-looking statement, which speaks only as of the date made. You
should refer to our periodic and current reports filed with the SEC for
specific risks which could cause actual results to be significantly different
from those expressed or implied by those forward-looking statements.
UNUMPROVIDENT CORPORATION
We are the surviving corporation in the merger on June 30, 1999 of Provident
Companies Inc., the leading individual disability insurance provider in North
America, with Unum Corporation, the leading group disability insurance
provider. We are the parent holding company for a group of insurance companies
that collectively operate in North America and in the United Kingdom, Japan,
and Argentina. Our principal operating subsidiaries are Unum Life Insurance
Company of America (Unum America), Provident Life and Accident Insurance
Company (Accident), The Paul Revere Life Insurance Company (Paul Revere Life),
and Colonial Life & Accident Insurance Company (Colonial). We, through our
subsidiaries, are the largest provider of group and individual disability
insurance in North America, the United Kingdom, and Japan. We also provide a
complementary portfolio of life insurance products, including long-term care
insurance, life insurance, employer- and employee-paid group benefits, and
related services.
UNUMPROVIDENT TRUSTS
Each of UnumProvident Financing Trust II and UnumProvident Financing Trust
III is a Delaware statutory business trust and was created by the certificate
of trust that we filed with the Secretary of State of Delaware on August 14,
2000. Each trust is subject to the terms of its declaration of trust that we
have executed as the depositor of the trust and which has also been executed by
trustees of the trust. At the time a trust issues any preferred securities, the
applicable declaration of trust will be amended and restated to set the terms
of the preferred securities. The common securities will represent an aggregate
liquidation amount equal to at least 3% of each trust's total capitalization.
The preferred securities will represent the remaining approximate 97% of the
trust's total capitalization. The terms of the common securities will also be
contained in the amended declaration and the common securities will rank
equally, and payments will be made ratably, with the preferred securities.
However, if there are certain continuing payment events of default under the
subordinated indenture, our rights as holder of the common securities to
distributions, liquidation, redemption and other payments from the trust will
be subordinated to the rights to those payments of the holders of the preferred
securities. Each trust will use the proceeds of the sale of the preferred
securities and the common securities to invest in junior subordinated debt
securities that we will issue to the trust. The preferred securities will be
guaranteed by us as described later in this prospectus.
Each trust has a term of approximately 45 years but may be dissolved earlier
under the terms of its amended declaration. The trustees of each trust will
conduct the business and affairs of the trust. As holder of the common
securities, we are entitled to appoint, remove, replace or increase or reduce
the number of trustees. The amended declarations govern the duties of the
trustees. Most of the trustees will be employees, officers or affiliates of
ours and will be referred to as administrative trustees. One trustee of each
trust, the property trustee, will be a financial institution that is not
affiliated with us and that has a minimum of combined capital and surplus of at
least $50 million. The property trustee will act as indenture trustee for the
purpose of compliance with the provisions of the Trust Indenture Act of 1939.
Unless the property trustee has a principal place of business in the State of
Delaware, and meets other legal requirements, we will appoint another trustee
for each trust who meets these requirements to serve as the Delaware trustee.
The trusts exist solely for the following purposes:
. to issue the preferred securities and common securities which we
collectively refer to as the trust securities and which represent
undivided beneficial interests in the assets of the trusts;
. to invest the gross proceeds from the sale of the trust securities in
junior subordinated debt securities issued by us;
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. to distribute the cash payments they receive from the junior
subordinated debt securities they own to the holders of the trust
securities; and
. to engage in only those other activities that are necessary for or are
incidental to issuing the trust securities and investing in the junior
subordinated debt securities.
We or any subsequent holder of the common securities will pay all fees and
expenses related to the trusts and the offering of the preferred securities and
will pay all ongoing costs and expenses of the trusts.
The property trustee of each trust is The Chase Manhattan Bank, 450 West
33rd Street, 15th Floor, New York, New York 10001. The Delaware trustee is
Chase Manhattan Bank USA, National Association and its address in the State of
Delaware is 1201 Market Street, Wilmington, Delaware 19801. The principal place
of business of each trust is c/o UnumProvident Corporation, 1 Fountain Square,
Chattanooga, Tennessee 37402. The telephone number for each trust at that
address is (423) 755-1011.
USE OF PROCEEDS
Unless otherwise specified in the applicable prospectus supplement for any
offering of securities, the net proceeds we receive from the sale of these
securities will be used for general corporate purposes, which may include:
. funding investments in, or extensions of credit to, our subsidiaries;
. reducing or refinancing debt;
. redeeming outstanding securities;
. financing possible acquisitions; and
. working capital.
Pending such use, we may temporarily invest net proceeds. We do not have any
present plans, and are not engaged in any negotiations, for the use of any such
proceeds, or the issuance of common stock, in any future acquisition. We will
disclose any proposal to use the net proceeds from any offering of securities
in connection with an acquisition in the prospectus supplement relating to such
offering.
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CONSOLIDATED RATIOS OF EARNINGS
TO FIXED CHARGES AND EARNINGS TO COMBINED
FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
Our consolidated ratio of earnings to fixed charges including our
consolidated subsidiaries is computed by dividing earnings by fixed charges.
The ratio of earnings to fixed charges for the periods prior to December 31,
1999 have been restated to give retroactive effect to the merger of Unum
Corporation and Provident Companies, Inc. on June 30, 1999. The following table
sets forth our consolidated ratios of earnings to fixed charges and ratios of
earnings to combined fixed charges and preferred stock dividends for the
periods shown:
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For the
Six Months
For the Year Ended December 31, Ended
------------------------------------ June 30,
1995 1996 1997 1998 1999(2) 2000
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Earnings to Fixed Charges
Excluding Preferred Stock
Dividends(1)................ 8.6 8.9 10.1 7.7 (0.1) 5.4
Including Preferred Stock
Dividends(3)................ 6.8 7.0 8.4 7.5 (0.1) 5.4
</TABLE>
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(1) For purposes of computing the ratio of earnings to fixed charges, earnings
as adjusted consist of income (loss) before income taxes plus fixed
charges. Fixed charges consist of interest and debt expense, amortization
of deferred debt costs, and the estimated interest portion of rent expense.
(2) Earnings are inadequate to cover fixed charges. The coverage deficiency
totals $165.5 million.
(3) For purposes of computing the ratio of earnings to fixed charges, earnings
as adjusted consist of income (loss) before income taxes plus fixed
charges. Fixed charges consist of interest and debt expense, amortization
of deferred debt costs, the estimated interest portion of rent expense and
preferred stock dividends.
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DESCRIPTION OF DEBT SECURITIES
General
The following summary outlines the material terms of the senior debt
securities and subordinated debt securities, which we collectively refer to as
the debt securities, that we may offer from time to time. The specific terms of
any debt securities we may offer and the extent, if any, to which these general
terms and provisions may or may not apply to the debt securities will be
described in the prospectus supplement relating to the particular series of
debt securities.
We will issue the senior debt securities under an indenture, which we will
enter into with The Chase Manhattan Bank, as trustee. We will also issue the
subordinated debt securities under an indenture, which we will enter into with
The Chase Manhattan Bank, as trustee. Except for the subordination provisions
included in the subordinated indenture, the indentures are substantially
identical. The indentures are subject to and governed by the Trust Indenture
Act, and we may supplement the indentures from time to time after we execute
them. The following description of the debt securities may not be complete and
is subject to and qualified in its entirety by reference to the form of either
the senior or the subordinated indenture relating to the particular series of
debt securities, each of which we have filed as an exhibit to the registration
statement that contains this prospectus. Capitalized terms used but not defined
in this description will have the meanings in the indentures. Wherever we refer
to particular sections or defined terms of the indentures, it is our intent
that those sections or defined terms will be incorporated by reference in this
prospectus.
Terms
The debt securities will be our direct, unsecured obligations. The
indebtedness represented by the senior debt securities will rank equally with
all our other unsecured and unsubordinated debt, but will be subordinated to
all of our existing and future secured indebtedness, if any. The indebtedness
represented by the subordinated debt securities will rank junior in right of
payment, under the terms contained in the subordinated indenture, and will be
subject to our prior payment in full of our senior debt all as described under
"--Subordination."
The amount of debt securities we offer will be limited to the amount
described on the cover of this prospectus. We may issue the debt securities, in
one or more series from time to time, as our board of directors may establish
by resolution or as we may establish in one or more supplemental indentures. We
may issue debt securities with terms different from those of debt securities we
previously issued. We may issue debt securities of the same series at more than
one time and, unless prohibited by the terms of the series, we may reopen a
series for issuances of additional debt securities, without the consent of the
holders of the outstanding debt securities of that series. The debt securities
may be denominated and payable in foreign currencies or units based on or
related to foreign currencies. Special United States federal income tax
considerations applicable to any debt securities denominated in foreign
currencies will be described in the applicable prospectus supplement.
Each indenture provides that there may be more than one trustee under the
indenture, each with respect to one or more series of the debt securities. Any
trustee under an indenture may resign or be removed with respect to one or more
series of the debt securities, and a successor trustee may be appointed to act
with respect to that series. Upon prior written notice, a trustee may be
removed by act of the holders of a majority in principal amount of the
outstanding debt securities of the series with respect to which the trustee
acts as trustee. If two or more persons are acting as trustee with respect to
different series of debt securities, each trustee will be a trustee of a trust
under the applicable indenture unrelated to the trust administered by any other
trustee. Except as otherwise stated in this prospectus, any action described in
this prospectus to be taken by each trustee may only be taken by the trustee
with respect to the one or more series of debt securities for which it is
trustee under the applicable indenture.
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You should refer to the applicable prospectus supplement relating to a
particular series of debt securities for the specific terms of the debt
securities, including, but not limited to:
(1) the title of the debt securities of the series and whether the debt
securities are senior debt securities or subordinated debt securities,
including junior subordinated debt securities;
(2) the total principal amount of the debt securities of the series and
any limit on the total principal amount;
(3) the price (expressed as a percentage of the principal amount of the
debt securities) at which we will issue the debt securities of the series;
(4) the terms, if any, by which holders may convert or exchange the debt
securities of the series into or for common stock or other of our
securities or property;
(5) if the debt securities of the series are convertible or
exchangeable, any limitations on the ownership or transferability of the
securities or property into which holders may convert or exchange the debt
securities;
(6) the date or dates, or the method for determining the date or dates,
on which we will be obligated to pay the principal of the debt securities
of the series and the amount of principal we will be obligated to pay;
(7) the rate or rates, which may be fixed or variable, at which the debt
securities of the series will bear interest, if any, or the method by which
the rate or rates will be determined;
(8) the date or dates, or the method for determining the date or dates,
from which any interest will accrue on the debt securities of the series,
the dates on which we will be obligated to pay any such interest, the
regular record dates if any, for the interest payments, or the method by
which the dates shall be determined, the persons to whom we will be
obligated to pay interest, and the basis upon which interest shall be
calculated if other than that of a 360-day year consisting of twelve 30-day
months;
(9) the place or places where the principal of, and any premium, Make-
Whole Amount (as defined in the indenture), interest or Additional Amounts
(as defined in the indenture) on, the debt securities of the series will be
payable, where the holders of the debt securities may surrender debt
securities for conversion, transfer or exchange, and where notices or
demands to or upon us in respect of the debt securities and the indenture
may be served;
(10) if other than the trustee, the identity of each security registrar
and/or paying agent for debt securities of the series;
(11) the period or periods during which, the price or prices (including
any premium or Make-Whole Amount) at which, the currency or currencies in
which, and the other terms and conditions upon which, we may redeem the
debt securities of the series, at our option, if we have such an option;
(12) any obligation of ours to redeem, repay or purchase debt securities
pursuant to any sinking fund or analogous provision or at the option of a
holder of debt securities, and the terms and conditions upon which we will
redeem, repay or purchase all or a portion of the debt securities of the
series pursuant to that obligation;
(13) the currency or currencies in which we will sell the debt
securities and in which the debt securities of the series will be
denominated and payable;
(14) whether the amount of payment of principal of, and any premium,
Make-Whole Amount, or interest on, the debt securities of the series may be
determined with reference to an index, formula or other method and the
manner in which the amounts will be determined;
(15) whether the principal of, and any premium, Make-Whole Amount,
interest or Additional Amounts on, the debt securities of the series are to
be payable, at our election or at the election of the holder of the debt
securities, in a currency or currencies other than that in which the debt
securities are denominated or stated to be payable, the period or periods
during which, and the terms and conditions upon which, this election may be
made, and the time and manner of, and identity of the exchange rate
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agent with responsibility for, determining the exchange rate between the
currency or currencies in which the debt securities are denominated or
stated to be payable and the currency or currencies in which the debt
securities will be payable;
(16) any provisions granting special rights to the holders of the debt
securities of the series at the occurrence of certain events;
(17) any additions to, modifications of or deletions from the terms of
the debt securities with respect to the events of default or covenants
contained in the applicable indenture;
(18) whether the debt securities of the series will be issued in
certificated or book-entry form and the related terms and conditions;
(19) whether the debt securities of the series will be in registered or
bearer form and the terms and conditions relating to the applicable form,
and if in registered form, the denomination in which we will issue the debt
securities if other than $1,000 or a multiple of $1,000 and, if in bearer
form, the denominations in which we will issue the debt securities if other
than $5,000 or a multiple of $5,000;
(20) the applicability, if any, of the defeasance or covenant defeasance
provisions described below under "--Discharge, Defeasance and Covenant
Defeasance";
(21) any applicable United States federal income tax consequences,
including whether and under what circumstances we will pay any Additional
Amounts as contemplated in the applicable indenture on the debt securities,
to any holder who is not a United States person in respect of any tax,
assessment or governmental charge withheld or deducted and, if we will pay
Additional Amounts, whether we will have the option, and on what terms to
redeem the debt securities instead of paying the Additional Amounts;
(22) whether we may extend the interest payment periods and, if so, the
terms of any extension;
(23) if the principal amount payable on any maturity date will not be
determinable on any one or more dates prior to the maturity date, the
amount which will be deemed to be the principal amount as of any date for
any purpose, including the principal amount which will be due and payable
upon any maturity other than the maturity date, or the manner of
determining that amount;
(24) any other covenant or warranty included for the benefit of the debt
securities of the series;
(25) any proposed listing of the debt securities of the series on any
securities exchange; and
(26) any other terms of such debt securities not inconsistent with the
provisions of the applicable indenture.
The debt securities of a series may provide for less than their entire
principal amount to be payable if we accelerate the maturity of the debt
securities as a result of the occurrence and continuation of an event of
default. If this is the case, the debt securities would have what is referred
to as "original issue discount." Any special U.S. federal income tax,
accounting and other considerations applicable to original issue discount
securities will be described in the applicable prospectus supplement.
We may issue debt securities of a series from time to time, with the
principal amount payable on any principal payment date, or the amount of
interest payable on any interest payment date, to be determined by reference to
one or more currency exchange rates, commodity prices, equity indices or other
factors. Holders of these debt securities may receive a principal amount on any
principal payment date, or a payment of interest on any interest payment date,
that is greater than or less than the amount of principal or interest otherwise
payable on such dates, depending upon the value on the applicable dates of the
applicable currency, commodity, equity index or other factors.
Information as to the methods for determining the amount of principal or
interest payable on any date, the currencies, commodities, equity indices or
other factors to which the amount payable on such date is linked and certain
additional tax considerations will be described in the applicable prospectus
supplement.
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The indentures do not contain any provisions that afford holders of the debt
securities protection in the event we engage in a transaction in which we incur
or acquire a large amount of additional debt.
Denominations, Interest, Registration and Transfer
Unless the applicable prospectus supplement states otherwise, debt
securities we issue in registered form of any series will be issued in
denominations of $1,000 and multiples of $1,000. Unless the applicable
prospectus supplement states otherwise, debt securities we issue in bearer form
will be issued in denominations of $5,000 and multiples of $5,000.
Unless the applicable prospectus supplement states otherwise, the principal
of, and any premium, Make-Whole Amount, or interest on, any series of debt
securities will be payable in the currency designated in the prospectus
supplement at the corporate trust office of the trustee, initially located at
The Chase Manhattan Bank, Global Trust Services, 15th Floor, 450 West 33rd
Street, New York, New York 10001. At our option, however, payment of interest
may be made by check mailed to the address of the person entitled to the
interest payment as it appears in the security register for the series or by
wire transfer of funds to that person at an account maintained within the
United States. We may at any time designate additional paying agents, remove
any paying agents, or approve a change in the office through which any paying
agent acts, except that we will be required to maintain a paying agent in each
place of payment for any series. All monies we pay to a paying agent for the
payment of principal of, or any premium, Make-Whole Amount, interest or
Additional Amounts on, any debt security which remains unclaimed at the end of
two years after the principal, premium or interest has become due and payable
will be repaid to us. After this time, the holder of the debt security will be
able to look only to us for payment.
Any interest we do not punctually pay on any interest payment date with
respect to a debt security will be defaulted interest and will cease to be
payable to the holder on the original regular record date and may either:
(1) be paid to the holder at the close of business on a special record
date for the payment of defaulted interest to be fixed by the applicable
trustee, or
(2) may be paid at any time in any other lawful manner, all as more
completely described in the applicable indenture.
If the defaulted interest is to be paid on a special record date, notice of
the special record date will be mailed to each holder of such not less than ten
days before the special record date.
Subject to certain limitations imposed on debt securities issued in book-
entry form, debt securities of any series will be exchangeable for other debt
securities of the same series and with the same total principal amount and
authorized denomination upon surrender of the debt securities at the corporate
trust office of the applicable trustee. In addition, subject to certain
limitations imposed upon debt securities issued in book-entry form, the debt
securities of any series may be surrendered for conversion, transfer or
exchange at the corporate trust office of the applicable trustee. Every debt
security surrendered for conversion, transfer or exchange will be duly endorsed
or accompanied by a written instrument of transfer. There will be no service
charge on any transfer or exchange of debt securities, but we may require
payment by holders to cover any tax or other governmental charge payable in
connection with the transfer or exchange.
If the applicable prospectus supplement refers to us designating a transfer
agent (in addition to the applicable trustee) for any series of debt
securities, we may at any time remove the transfer agent or approve a change in
the location at which the transfer agent acts, except that we will be required
to maintain a transfer agent in each place of payment for any series of debt
securities. We may at any time designate additional transfer agents with
respect to any series of debt securities.
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Neither we nor any trustee will be required to do any of the following:
(1) issue, register the transfer of or exchange debt securities of any
series during a period beginning at the opening of business 15 days before
there is a selection of debt securities of that series to be redeemed and
ending at the close of business on the day of mailing or publication of the
relevant notice of redemption;
(2) register the transfer of or exchange any debt security, or portion
thereof, called for redemption, except the unredeemed portion of any debt
security being only partially redeemed;
(3) exchange any debt security in bearer form that is selected for
redemption, except a debt security in bearer form may be exchanged for a
debt security in registered form of that series and like denomination,
provided that the debt security in registered form shall be simultaneously
surrendered for redemption or exchange; or
(4) issue, register the transfer of or exchange any debt security that
has been surrendered for repayment at the option of the holder, except the
portion, if any, of the debt security that is not to be repaid.
Global Securities
The debt securities in registered form of a series may be issued in the form
of one or more fully registered global securities that will be deposited with a
depositary or with a nominee for a depositary identified in the applicable
prospectus supplement relating to the series and registered in the name of the
depositary or its nominee. In this case, one or more registered global
securities will be issued in a denomination or total denominations equal to the
portion of the total principal amount of outstanding registered debt securities
of the series to be represented by the registered global securities or
securities. Unless and until it is wholly exchanged for debt securities in
definitive registered form, a registered global security may not be transferred
except as a whole by the depositary to its nominee or by a nominee to the
depositary or another nominee, or by the depositary or its nominee to a
successor of the depositary or the successor depositary's nominee.
The specific terms of the depositary arrangement with respect to any portion
of a series of debt securities to be represented by a registered global
security will be described in the applicable prospectus supplement. We
anticipate that the following provisions will apply to all depositary
arrangements.
Ownership of beneficial interests in a registered global security will be
limited to persons that have accounts with, or are participants of, the
depositary for the registered global security or persons that may hold
interests through participants. When we issue a registered global security, the
depositary will credit, on its book-entry registration and transfer system, the
participants' accounts with the respective principal amounts of the debt
securities represented by the registered global security owned by those
participants. The accounts to be credited will be designated by any dealers,
underwriters or agents participating in the distribution of the debt
securities. Ownership of participants in a registered global security will be
shown on, and the transfer of such ownership interests will be effected only
through, records maintained by the depositary and ownership of persons who hold
debt securities through participants will be reflected on the records of
participants. The laws of some states may require that certain purchasers of
securities take physical delivery of such securities in definitive form. These
laws may impair a person's ability to own, transfer or pledge beneficial
interests in a registered global security.
So long as the depositary, or its nominee, is the registered owner of the
global security, the depositary or such nominee, as the case may be, will be
considered the sole owner or holder of the debt securities represented by the
registered global security for all purposes under the applicable indenture.
Except as set forth below, owners of beneficial interests in a registered
global security will not be entitled to have the debt securities represented by
the registered global security registered in their names, will not receive or
be entitled to receive physical delivery of the debt securities in definitive
form, and will not be considered the owners or holders thereof under the
applicable indenture. Accordingly, each person owning a beneficial interest in
a registered global security must rely on the procedures of the depositary and,
if such person is not a participant,
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on the procedures of the participant through which such person owns its
interest, to exercise any rights of a holder under the applicable indenture. We
understand that under existing industry practices, if we request any action of
holders or if an owner of a beneficial interest in a registered global security
desires to give or take any action which a holder is entitled to give or take
under the applicable indenture, the depositary would authorize the participants
holding the relevant beneficial interests to give or take the action, and the
participants would authorize beneficial owners owning through the participants
to give or take such action or would otherwise act upon the instructions of
beneficial owners holding through them.
Payments of principal of, and any premium, Make-Whole Amount, interest or
Additional Amounts on, debt securities represented by a registered global
security will be made to the depositary or its nominee, as the case may be, as
the registered owner of the registered global security. None of us, the trustee
or any other agent of ours or agent of the trustee will have any responsibility
or liability for any aspect of the records relating to, or payments made on
account of, beneficial ownership interests in the registered global security or
for maintaining, supervising or reviewing any records relating to the
beneficial ownership interests.
We expect that once the depositary receives any payment of principal of, and
any premium, Make-Whole Amount, interest or Additional Amounts on, a registered
global security, the depositary will immediately credit participants' accounts
with payments in amounts proportionate to their respective beneficial interests
in the registered global security as shown on the records of the depositary. We
also expect that payments by participants to owners of beneficial interests in
the registered global security held through the participants will be governed
by standing customer instructions and customary practices, as is now the case
with the securities held for the accounts of customers in bearer form or
registered in "street name," and will be the responsibility of the
participants.
If the depositary is at any time unwilling or unable to continue as
depositary or ceases to be a clearing agency registered under the Securities
Exchange Act of 1934, and we do not appoint a successor depositary registered
as a clearing agency under the Exchange Act within 90 days, we will issue debt
securities in definitive form in exchange for the registered global security.
In addition, we may at any time and in our sole discretion determine not to
have any of the debt securities of a series represented by one or more
registered global securities and, in such event, will issue debt securities of
such series in a definitive form in exchange for all of the registered global
security or securities representing the debt securities. Any debt securities
issued in definitive form in exchange for a registered global security will be
registered in such name or names as the depositary shall instruct the trustee.
It is expected that such instructions will be based upon directions received by
the depositary from participants with respect to ownership of beneficial
interests in the registered global security.
Debt securities in bearer form of a series may also be issued in the form of
one or more global securities that will be deposited with a common depositary
for Euroclear and CEDEL, or with a nominee for such depositary identified in
the applicable prospectus supplement. The specific terms and procedures,
including the specific terms of the depositary arrangement and any specific
procedures for the issuance of debt securities in definitive form in exchange
for a bearer form global security, with respect to any portion of a series of
debt securities to be represented by a bearer form global security will be
described in the applicable prospectus supplement.
Merger, Consolidation or Sale
We may consolidate with, or sell, lease or otherwise transfer all or
substantially all of our assets to, or merge with or into, any other
corporation or trust or entity provided that:
(1) we are the survivor in the merger, or the survivor, if not us, is an
entity organized under the laws of the United States or a state of the
United States and expressly assumes by supplemental indenture the due and
punctual payment of the principal of, and any premium, Make-Whole Amount,
interest or Additional Amounts on, all of the outstanding debt securities
and the due and punctual performance and observance of all of the covenants
and conditions contained in each indenture;
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(2) immediately after giving effect to the transaction and treating any
indebtedness that becomes an obligation of ours or one of our subsidiaries
as a result of the transaction, as having been incurred by us or the
subsidiary at the time of the transaction, there is no event of default
under the indenture, and no event which, after notice or the lapse of time,
or both, would become an event of default;
(3) if, as a result of the transaction, our property or assets would be
subject to an encumbrance that would not be permitted under the indenture,
we shall take steps to secure the debt securities equally and ratably with
all indebtedness secured in the transaction; and
(4) certain other conditions that are described in the indentures are
met.
Upon any such consolidation, merger, or sale, the successor corporation
formed, or into which we are merged or to which we are sold, shall succeed to,
and be substituted for, us under the indentures.
This covenant would not apply to any recapitalization transaction, change of
control of us or a transaction in which we incur a large amount of additional
debt unless the transactions or change of control included a merger or
consolidation or transfer of substantially all of our assets. Except as may be
described in the applicable prospectus supplement, there are no covenants or
other provisions in the indentures providing for a put or increased interest or
that would otherwise afford holders of debt securities additional protection in
the event of a recapitalization transaction, a change of control of us or a
transaction in which we incur or acquire a large amount of additional debt.
Certain Covenants
Existence. Except as permitted under "--Merger, Consolidation or Sale" above
we will do or cause to be done all things necessary to preserve and keep our
legal existence, rights and franchises in full force and effect; provided,
however, that we will not be required to preserve any right or franchise if we
determine that the preservation of that right or franchise is no longer
desirable in the conduct of our business and that its loss is not
disadvantageous in any material respect to the holders of any debt securities.
Maintenance of Properties. We will cause all of our material properties used
or useful in the conduct of our business or the business of any of our
subsidiaries to be maintained and kept in good condition, repair and working
order and supplied with all necessary equipment and we will cause to be made
all necessary repairs, renewals, replacements, betterments and improvements for
those properties, as we in our judgment believe is necessary so that we may
carry on the business related to those properties properly and advantageously
at all times; provided, however, that we will not be prevented from selling or
otherwise disposing of our properties or the properties of our subsidiaries in
the ordinary course of business.
Payment of Taxes and Other Claims. We will pay or discharge, or cause to be
paid or discharged, before they become delinquent,
(1) all taxes, assessments and governmental charges levied or imposed
upon us or any subsidiary of ours or upon our income, profits or property
or that of any subsidiary of ours, and
(2) all lawful claims for labor, materials and supplies which, if
unpaid, might by law become a lien upon our property or any subsidiary of
ours;
provided, however, that we will not be required to pay or discharge or cause to
be paid or discharged any tax, assessment, charge or claim the amount,
applicability or validity of which is being contested in good faith by
appropriate proceedings.
Provision of Financial Information. Whether or not we are subject to Section
13 or 15(d) of the Exchange Act, we will, within 15 days of each of the
respective dates by which we are or would be required to file annual reports,
quarterly reports and other documents with the SEC pursuant to such Section 13
and 15(d):
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(1) file with the applicable trustee copies of the annual reports,
quarterly reports and other documents that we are or would be required to
file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act; and
(2) promptly upon written request and payment of the reasonable cost of
duplication and delivery, supply copies of those documents to any
prospective holder.
Waiver of Certain Covenants. We may choose not to comply with any term,
provision or condition of the foregoing covenants, or with certain other terms,
provisions or conditions with respect to the debt securities of a series
(except any such term, provision or condition which could not be amended
without the consent of all holders of such series), if before or after the time
for compliance with the covenant, term, provision or condition, the holders of
at least a majority in principal amount of all outstanding debt securities of
the series either waive compliance in that instance or generally waive
compliance with that covenant or condition. Unless the holders expressly waive
compliance with a covenant and the waiver has become effective, our obligations
and the duties of the trustee in respect of the term, provision, or condition
will remain in full force and effect.
Covenants Relating to Junior Subordinated Debt Securities. In the
subordinated indenture that governs the terms of the junior subordinated debt
securities we issue to a trust, in connection with the issuance of trust
securities, we will covenant that, so long as any preferred securities of the
trust remain outstanding, if there has occurred any event that would constitute
an event of default under the applicable trust guarantee or amended declaration
or if we have extended the interest payment periods of the junior subordinated
debt securities, we will not do any of the following:
(1) declare or pay any dividend on, make any distributions with respect
to, or redeem, purchase, acquire or make a liquidation payment with respect
to, any of our capital stock, except for
. purchases or acquisitions of shares of common stock in connection
with the satisfaction of our obligations under any employee benefit
plans or the satisfaction of our obligations pursuant to any
contract or security outstanding on the date of the event, which
requires us to purchase shares of our common stock,
. as a result of a reclassification of our capital stock or the
exchange or conversion of one class or series of our capital stock
for another class or series of our capital stock, or
. the purchase of fractional interests in shares of our capital stock
pursuant to the conversion or exchange provisions of the capital
stock or the security being converted or exchanged;
(2) make any payment of interest, principal or premium on, or repay,
repurchase or redeem, any debt securities (including guarantees) we have
issued which rank equally with or junior to the subordinated debt
securities held by the applicable trust; or
(3) make any guarantee payments on any obligations ranking equally with
or junior to the subordinated debt securities held by the trust, except
under the applicable trust guarantee.
Additional Covenants. Any additional covenants with respect to any series of
debt securities will be described in the applicable prospectus supplement.
Events of Default, Notice and Waiver
Except as otherwise described in the applicable prospectus supplement, each
indenture provides that the following events are "Events of Default" with
respect to any series of debt securities we may issue under those indentures:
(1) we fail for 30 days to pay any installment of interest or any
Additional Amounts payable on any debt security of that series;
(2) we fail to pay the principal of, or any premium or Make-Whole Amount
on, any debt security of that series when due, either at maturity,
redemption or otherwise;
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(3) we fail to make any sinking fund payment when due as required for
any debt security of that series;
(4) we default in the performance or breach of any other covenant or
agreement we made in the indenture other than a covenant added to the
indenture solely for the benefit of another series of debt securities,
which has continued for 60 days after written notice as provided for in
accordance with the applicable indenture by the applicable trustee or the
holders of at least 25% in principal amount of the outstanding debt
securities of the affected series;
(5) we default under a bond, debenture, note or other evidence of
indebtedness for money borrowed by us or any subsidiary of ours that we
have guaranteed that has a principal amount outstanding that is more than
$10,000,000 (other than non-recourse indebtedness), which default has
caused the indebtedness to become due and payable earlier than it would
otherwise have become due and payable, and the acceleration has not been
rescinded or annulled within 30 days after written notice was provided to
us in accordance with the indenture;
(6) certain events of bankruptcy, insolvency or reorganization occur;
and
(7) any other event of default specified in the applicable prospectus
supplement occurs.
If there is a continuing event of default under an indenture with respect to
outstanding debt securities of a series, then the applicable trustee or the
holders of not less than 25% of the total principal amount of the outstanding
debt securities of that series, voting as a single class, may declare
immediately due and payable the principal amount or other amount as may be
specified in the terms of the securities of and any premium or Make-Whole
Amount on, all of the debt securities of that series. However, at any time
after a declaration of acceleration with respect to any or all debt securities
of a series then outstanding has been made, but before a judgment or decree for
payment of the money due has been obtained by the applicable trustee, the
holders of not less than a majority in principal amount of the outstanding debt
securities of that series may cancel the acceleration if:
(1) we deposit with the applicable trustee all required payments of the
principal of, and any premium, Make-Whole Amount, interest or Additional
Amounts, on the applicable debt securities, plus certain fees, expenses,
disbursements and advances of the applicable trustee; and
(2) all events of default, other than the nonpayment of accelerated
principal, premium, Make-Whole Amount or other amounts or interest, with
respect to the applicable debt securities have been cured or waived as
provided in the indenture.
Each indenture also provides that the holders of not less than a majority in
principal amount of the applicable outstanding debt securities of any series
may waive any past default with respect to those debt securities and its
consequences, except a default consisting of:
(1) our failure to pay the principal of, and any premium, Make-Whole
Amount, interest or Additional Amounts on, any debt security; or
(2) a default relating to a covenant or provision contained in the
applicable indenture that cannot be modified or amended without the consent
of the holders of each outstanding debt security affected by the default.
The trustee is generally required to give notice to the holders of debt
securities of each affected series within 90 days of a default of which the
trustee has actual knowledge under the applicable indenture unless the default
has been cured or waived. The trustee may withhold a notice of default unless
the default relates to:
(1) our failure to pay the principal of, or any premium, Make-Whole
Amount, interest or Additional Amounts on, a debt security of that series;
or
(2) any sinking fund installment for any debt security of that series,
if the responsible officers of the trustee consider it to be in the
interest of the holders.
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Each indenture provides that no holder of debt securities of any series may
institute a proceeding with respect to the indenture or for any remedy under
the indenture, unless the applicable trustee fails to act, for 60 days, after
(1) it has received a written request to institute proceedings in respect of an
event of default from the holders of not less than 25% in principal amount of
the outstanding debt securities of the series, as well as an offer of indemnity
reasonably satisfactory to the trustee and (2) no direction inconsistent with
such written request has been given to the trustee during that 60 day period by
the holders of a majority in principal amount of the outstanding securities of
the series. This provision will not prevent, however, any holder of debt
securities from instituting suit for the enforcement of payment of the
principal of, and any premium, Make-Whole Amount, interest or Additional
Amounts on, debt securities at their respective due dates.
Subject to provisions in each indenture relating to the trustee's duties in
case of default, the trustee is not under an obligation to exercise any of its
rights or powers under any indenture at the request or direction of any holders
of any series of debt securities then outstanding, unless the holders have
offered to the trustee security or indemnity satisfactory to it. Subject to
these provisions for the indemnification of the trustee, the holders of not
less than a majority in principal amount of the applicable outstanding debt
securities will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the applicable trustee,
or of exercising any trust or power conferred upon the trustee. However, the
trustee may refuse to follow any direction which is in conflict with any law or
the applicable indenture, which may involve the trustee in personal liability
or which may be unduly prejudicial to the holders of debt securities of the
applicable series not joining in the direction.
Within 120 days after the close of each fiscal year, we must deliver to each
trustee a certificate, signed by one of several specified officers, stating
such officer's knowledge of our compliance with all the conditions and
covenants under the applicable indenture and, in the event of any
noncompliance, specifying such noncompliance and the nature and status of the
noncompliance.
Modification of the Indenture
Modification and amendment of an indenture may be made only with the consent
of the holders of not less than a majority in principal amount of all
outstanding debt securities issued under the indenture which are affected by
the modification or amendment. However, no modification or amendment may,
without the consent of the holder of each debt security affected, do any of the
following:
(1) change the stated maturity of the principal of, or any premium,
Make-Whole Amount, installment of principal of, interest or Additional
Amounts payable on, any debt security;
(2) reduce the principal amount of, or the rate or amount of interest
on, any premium, Make-Whole Amount payable on redemption of or any
Additional Amounts payable with respect to, any debt security;
(3) reduce the amount of principal of an original issue discount
security, indexed security or any Make-Whole Amount that would be due and
payable upon declaration of acceleration of the maturity of an original
issue discount security or indexed security, or would be provable in
bankruptcy, or adversely affect any right of repayment of the holder of any
debt security;
(4) change the place of payment or the currency or currencies of payment
of the principal of, and any premium, Make-Whole Amount, interest or
Additional Amounts on, any debt security;
(5) impair the right to institute suit for the enforcement of any
payment on or with respect to any debt security;
(6) reduce the percentage of the holders of outstanding debt securities
of any series necessary to modify or amend the applicable indenture, to
waive compliance with certain provisions thereof or certain defaults and
consequences thereunder, or to reduce the quorum or voting requirements
contained in the applicable indenture;
(7) make any change that adversely affects the right to convert or
exchange any security or decrease the conversion or exchange rate or
increase the conversion or exchange price of any security; or
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(8) modify any of the foregoing provisions or any of the provisions
relating to the waiver of certain past defaults or certain covenants,
except to increase the required percentage to effect such action or to
provide that certain other provisions may not be modified or waived without
the consent of the holder of the debt security.
We and the relevant trustee may modify or amend an indenture, without the
consent of any holder of debt securities, for any of the following purposes:
(1) to evidence the succession of another person to us as obligor under
the indenture;
(2) to add to the covenants for the benefit of the holders of all or any
series of debt securities or to surrender any right or power conferred upon
us in the indenture;
(3) to add events of default for the benefit of the holders of all or
any series of debt securities;
(4) to add or change any provisions of an indenture to facilitate the
issuance of, or to liberalize certain terms of, debt securities in bearer
form, or to permit or facilitate the issuance of debt securities in
uncertificated form, provided that such action shall not adversely affect
the interests of the holders of the debt securities of any series in any
material respect;
(5) to add, change or eliminate any provisions of an indenture, provided
that any such addition, change or elimination shall
. become effective only when there are no outstanding debt securities
of any series created prior to the change or elimination which are
entitled to the benefit of the applicable provision, or
. not apply to any outstanding debt securities created prior to the
change or elimination;
(6) to secure the debt securities;
(7) to establish the form or terms of debt securities of any series,
including the provisions and procedures, if applicable, for the conversion
of the debt securities into our common stock or other securities or
property of ours;
(8) to provide for the acceptance or appointment of a successor trustee
or facilitate the administration of the trusts under an indenture by more
than one trustee;
(9) to cure any ambiguity, defect or inconsistency in an indenture,
provided that the action does not adversely affect the interests of holders
of debt securities of any series issued under the indenture;
(10) to close an indenture with respect to the authentication and
delivery of additional series of debt securities or to qualify, or maintain
qualification of, an indenture under the Trust Indenture Act;
(11) to supplement any of the provisions of an indenture to the extent
necessary to permit or facilitate defeasance and discharge of any series of
the debt securities; provided that, in each case above, the action does not
adversely affect the interests of the holders of the debt securities of any
series in any material respect; or
(12) to make any provisions with respect to the conversion or exchange
rights of the holders of any debt securities, including providing for the
conversion or exchange of any debt securities into any of our securities or
property.
Subordination
Unless otherwise indicated in the applicable prospectus supplement for a
particular series of subordinated debt securities, the following subordinated
provisions will apply to the subordinated debt securities.
The subordinated debt securities, including any junior subordinated debt
securities we issue in connection with the issuance of any trust preferred
securities by a trust, will be unsecured and subordinated in right of payment
to all of our existing and future secured and senior indebtedness. As a result,
upon any distribution to our creditors in a liquidation, dissolution,
bankruptcy, insolvency or reorganization, the payment of the principal of and
interest on the subordinated debt securities will be subordinated to the extent
provided in the
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subordinated indenture in right of payment to the prior payment in full of all
our senior debt and our secured debt. Our obligation to make payments of the
principal of and interest on the subordinated debt securities will not
otherwise be affected.
We may not make payments of principal or interest on the subordinated debt
securities at any time we are in default on any payment with respect to our
senior debt, or we have defaulted on any of our senior debt resulting in the
acceleration of the maturity of the senior debt, or if there is a judicial
proceeding pending with respect to our default on our senior debt and we have
received notice of the default. We may resume payments on the subordinated debt
securities when the default is cured or waived if the subordination provisions
of the subordinated indenture will permit us to do so at that time. After we
have paid all of our senior debt in full, holders of subordinated debt
securities will still be subrogated to the rights of holders of our senior debt
for the amount of distributions otherwise payable to holders of the
subordinated debt securities until the subordinated debt securities are paid in
full. Because of this subordination, in the event of a distribution of our
assets upon insolvency, certain of our general creditors may recover more on a
proportional basis than holders of the subordinated debt securities.
Senior debt is defined in the subordinated indenture as the principal,
premium, if any, unpaid interest (including interest accruing on or after the
filing of any petition in bankruptcy or for reorganization relating to us
whether or not a claim for post-filing interest is allowed in such proceeding),
fees, charges, expenses, reimbursement and indemnification obligations, and all
other amounts payable under or in respect of the types of debt generally
described below:
(1) debt for money we have borrowed;
(2) debt evidenced by a bond, note, debenture, or similar instrument
(including purchase money obligations) whether or not given in connection
with the acquisition of any business, property or assets, whether by
purchase, merger, consolidation or otherwise, but not any account payable
or other obligation created or assumed in the ordinary course of business
in connection with the obtaining of materials or services;
(3) debt which is a direct or indirect obligation which arises as a
result of banker's acceptances or bank letters of credit issued to secure
our obligations, or to secure the payment of revenue bonds issued for our
benefit, whether contingent or otherwise;
(4) any debt of others described in the preceding clauses (1) through
(3) which we have guaranteed or for which we are otherwise liable;
(5) debt secured by any mortgage, pledge, lien, charge, encumbrance or
any security interest existing on our property;
(6) our obligation as lessee under any lease of property which is
reflected on our balance sheet as a capitalized lease;
(7) any deferral, amendment, renewal, extension, supplement or refunding
of any liability of the kind described in any of the preceding clauses (1)
through (6); and
(8) our obligations to make payments under the terms of financial
instruments such as securities contracts and foreign currency exchange
contracts, derivative instruments and other similar financial instruments.
provided, however, that, in computing our debt, any particular debt will be
excluded if,
(1) upon or prior to the maturity thereof, we have deposited in trust
with a depositary, money (or evidence of indebtedness if permitted by the
instrument creating such indebtedness) in the necessary amount to pay,
redeem or satisfy that debt as it becomes due, and the amount so deposited
will not be included in any computation of our assets; and
(2) we have delivered an officers' certificate to the trustee that
certifies that we have deposited in trust with the depositary the
sufficient amount.
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Senior debt will exclude the following:
(1) any debt referred to in paragraphs (1) through (6) above as to
which, in the instrument creating or evidencing the debt or under which the
debt is outstanding, it is provided that the debt is not superior in right
of payment to our subordinated debt securities, or ranks equal with the
subordinated debt securities;
(2) our subordinated debt securities;
(3) any debt of ours which when incurred and without respect to any
election under Section 1111(b) of the United States Bankruptcy Code of
1978, as amended, was without recourse to us;
(4) debt to any employee of ours; and
(5) all other junior subordinated debentures issued by us from time to
time and sold to subsidiaries of ours, including any limited liability
companies, partnerships or trust established or to be established by us, in
each case where the subsidiary is similar in purpose to one of the trusts.
There is no limit on the amount of senior debt or other debt that we may
incur. At June 30, 2000, our senior debt aggregated approximately $1.17
billion.
Discharge, Defeasance and Covenant Defeasance
Unless the terms of a series of debt securities provides otherwise, under
each indenture, we may discharge certain obligations to holders of any series
of debt securities that have not already been delivered to the applicable
trustee for cancellation and that either have become due and payable or will
become due and payable within one year (or are scheduled for redemption within
one year). We can discharge these obligations by irrevocably depositing with
the applicable trustee funds in such currency or currencies in which the debt
securities are payable in an amount sufficient to pay the entire indebtedness
on the debt securities including the principal of, and any premium, Make-Whole
Amount, interest or Additional Amounts payable on, the debt securities to the
date of the deposit, if the debt securities have become due and payable or to
the stated maturity or redemption date, as the case may be.
In addition, if the terms of the debt securities of a series permit us to do
so, we may elect either of the following:
(1) to be defeased and be discharged from any and all obligations with
respect to the debt securities of that series; except our obligations to
. pay any Additional Amounts upon the occurrence of certain tax and
other events,
. register the transfer or exchange of the debt securities,
. replace temporary or mutilated, destroyed, lost or stolen debt
securities,
. maintain an office or agency for the debt securities, and
. to hold moneys for payment in trust; or
(2) to be defeased and discharged from our obligations with respect to
the debt securities of that series described under "--Certain Covenants"
or, if the terms of the debt securities of that series permit, our
obligations with respect to any other covenant.
If we choose to defease and discharge our obligations under the covenants,
any failure to comply with the obligations imposed on us by the covenants will
not constitute a default or an event of default with respect to the debt
securities of that series. However, to make either election we must irrevocably
deposit with the applicable trustee, in trust, an amount, in the currency or
currencies in which the debt securities are payable, or in government
obligations, or both, that will provide sufficient funds to pay the principal
of, and any premium, Make-Whole Amount, interest or Additional Amounts on, the
debt securities, and any mandatory sinking fund or analogous payments on the
debt securities, on the relevant scheduled due dates or upon redemption.
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We may defease and discharge our obligations as described in the preceding
paragraphs only if, among other things,
(1) we have delivered to the applicable trustee an opinion of counsel to
the effect that the holders of the debt securities will not recognize
income, gain or loss for United States federal income tax purposes as a
result of the defeasance or covenant defeasance described in the previous
paragraphs and will be subject to United States federal income tax on the
same amounts, in the same manner and at the same times as would have been
the case if the defeasance or covenant defeasance had not occurred. In the
case of defeasance the opinion of counsel must refer to and be based upon a
ruling of the Internal Revenue Service or a change in applicable United
States federal income tax laws occurring after the date of the indenture;
(2) any defeasance does not result in, or constitute, a breach or
violation of an indenture or any other material agreement which we are a
party to or obligated under; and
(3) no event of default, or event that with notice will be an event of
default, has occurred and is continuing with respect to any securities
subject to a defeasance.
Unless otherwise provided in the applicable prospectus supplement, if, after
we have deposited funds and/or government obligations to effect defeasance or
covenant defeasance with respect to debt securities of any series:
(1) the holder of a debt security of such series elects to receive
payment in a currency in which the deposit was made in respect of the debt
security, or
(2) a conversion event (as defined below) occurs in respect of the
currency in which the deposit was made,
the indebtedness represented by the debt security shall be deemed to have been,
and will be, fully discharged and satisfied through the payment of the
principal of, and any premium, Make-Whole Amount, interest or Additional
Amounts on, the debt security, as they become due, out of the proceeds yielded
by converting the amount so deposited in respect of the debt security into the
currency in which the debt security becomes payable as a result of the election
or such cessation of usage based on the applicable market exchange rate.
Unless otherwise defined in the applicable prospectus supplement,
"conversion event" means the cessation of use of:
(1) a currency, currency unit or composite currency issued by the
government of one or more countries other than the United States both by
the government of the country that issued such currency and for the
settlement of transactions by a central bank or other public institutions
of or within the international banking community, or
(2) any currency unit or composite currency for the purposes for which
it was established.
Unless otherwise described in the applicable prospectus supplement, all
payments of principal of, and any premium, Make-Whole Amount, interest or
Additional Amounts on, any debt security that is payable in a foreign currency
that ceases to be used by its government of issuance will be made in United
States dollars.
In the event we effect covenant defeasance with respect to any series of
debt securities and the debt securities are declared due and payable because of
the occurrence of any event of default other than:
(1) the event of default described in clause (4) of the first paragraph
under "--Events of Default, Notice and Waiver," which would no longer be
applicable to the debt securities of that series, or
(2) the event of default described in clause (7) under "--Events of
Default, Notice and Waiver" with respect to a covenant as to which there
has been covenant defeasance,
then the amount on deposit with the trustee will still be sufficient to pay
amounts due on the debt securities at the time of their stated maturity but may
not be sufficient to pay amounts due on the debt securities
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at the time of the acceleration resulting from the event of default. In this
case, we would remain liable to make payment of such amounts due at the time
of acceleration.
The applicable prospectus supplement may describe further provisions, if
any, permitting defeasance or covenant defeasance, including any modifications
to the provisions described above, with respect to a particular series of debt
securities.
Conversion and Exchange Rights
The terms on which debt securities of any series are convertible into or
exchangeable for our common stock or other securities or property of ours will
be set forth in the applicable prospectus supplement. These terms will
include:
(1) the conversion or exchange price, or manner for calculating a price;
(2) the exchange or conversion period; and
(3) whether the conversion or exchange is mandatory, at the option of
the holder, or at our option.
The terms may also include calculations pursuant to which the number of
shares of our common stock or other securities or property to be received by
the holders of debt securities would be determined according to the market
price of our common stock or other securities or property of ours as of a time
stated in the prospectus supplement. The conversion exchange price of any debt
securities of any series that is convertible into our common stock may be
adjusted for any stock dividends, stock splits, reclassification, combinations
or similar transactions, as described in the applicable prospectus supplement.
Governing Law
The indentures are governed by and will be construed in accordance with the
laws of the State of New York.
Redemption of Debt Securities
If so specified in the applicable prospectus supplement, debt securities of
any series may be wholly or partially redeemed at our option, at any time. The
debt securities may also be subject to optional or mandatory redemption on
terms and conditions described in the applicable prospectus supplement.
From and after notice has been given as provided in the indenture, if funds
for the redemption of any debt securities called for redemption have been made
available on the redemption date, the debt securities will cease to bear
interest on the date fixed for the redemption specified in the notice, and the
only right of the holders of the debt securities will be to receive payment of
the redemption price.
Concerning the Trustee
The Chase Manhattan Bank is one of a number of banks with which we maintain
banking relationships in the ordinary course of business. Our banking
relationship with The Chase Manhattan Bank includes providing us with $200
million of short-term funding due in November 2000, providing custodial
services in connection with our bond and stock portfolios, serving as trustee
under the indentures involving our debt securities, and providing us with
general banking services. Upon the occurrence of an event of default or an
event which, after notice or lapse of time or both, would become an event of
default under a series of senior debt securities or subordinated debt
securities, or upon the occurrence of a default under another indenture under
which The Chase Manhattan Bank serves as trustee, the trustee may be deemed to
have a conflicting interest with respect to the other debt securities as to
which we are not in default for purposes of the Trust Indenture Act and,
accordingly, may be required to resign as trustee under the applicable
indenture. In that event, we would be required to appoint a successor trustee.
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DESCRIPTION OF PREFERRED STOCK
The following outlines some of the provisions of the preferred stock that we
may offer from time to time. The specific terms of a series of preferred stock
will be described in the applicable prospectus supplement relating to that
series of preferred stock. The following description of the preferred stock and
any description of preferred stock in a prospectus supplement may not be
complete and is subject to and qualified in its entirety by reference to the
certificate of designations relating to the particular series of preferred
stock, which we will file with the SEC at or prior to the time of sale of the
preferred stock.
General
Under our restated certificate of incorporation, our board of directors is
authorized, without stockholder approval, to adopt resolutions providing for
the issuance of up to 25,000,000 shares of preferred stock par value $.10 per
share, in one or more series.
For each series of preferred stock the board of directors may fix the voting
powers, designations, preferences and rights, and qualifications, limitations
or restrictions of the series. The board will fix these terms by resolution
adopted before we issue any shares of the series of preferred stock.
In addition, as described under "DESCRIPTION OF DEPOSITARY SHARES," we may,
instead of offering full shares of any series of preferred stock, offer
depositary shares evidenced by depositary receipts, each representing a
fraction of a share of the particular series of preferred stock issued and
deposited with a depositary. The fraction of a share of preferred stock which
each depositary share represents will be set forth in the prospectus supplement
relating to the depositary shares.
The prospectus supplement relating to the particular series of preferred
stock will contain a description of the specific terms of that series as fixed
by the board of directors, including, as applicable:
. the offering price at which we will issue the preferred stock;
. the title, designation of number of shares and stated value of the
preferred stock;
. the dividend rate or method of calculation, the payment dates for
dividends and the place or places where the dividends will be paid,
whether dividends will be cumulative or noncumulative, and, if
cumulative, the dates from which dividends will begin to cumulate;
. any conversion or exchange rights;
. whether the preferred stock will be subject to redemption and the
redemption price and other terms and conditions relative to the
redemption rights;
. any liquidation rights;
. any sinking fund provisions;
. any voting rights; and
. any other rights, preferences, privileges, limitations and restrictions
that are not inconsistent with the terms of our restated certificate of
incorporation.
When we issue and receive payment for shares of preferred stock, the shares
will be fully paid and nonassessable, and for each share issued, a sum equal to
the stated value will be credited to our preferred stock account. Holders of
preferred stock will not have any preemptive or subscription rights to acquire
more of our stock. Unless otherwise specified in the prospectus supplement
relating to a particular series of preferred stock, each series of preferred
stock will rank on a parity in all respects with each other series of preferred
stock and prior to our common stock as to dividends and any distribution of our
assets.
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The rights of holders of the preferred stock offered may be adversely
affected by the rights of holders of any shares of preferred stock that may be
issued in the future. Our board of directors may cause shares of preferred
stock to be issued in public or private transactions for any proper corporate
purposes and may include issuances to obtain additional financing in connection
with acquisitions, and issuances to officers, directors and employees pursuant
to benefit plans. Our board of directors' ability to issue shares of preferred
stock may discourage attempts by others to acquire control of us without
negotiation with our board of directors, as it may make it difficult for a
person to complete an acquisition of us without negotiating with our board.
Redemption
If so specified in the applicable prospectus supplement, a series of
preferred stock may be redeemable at any time, in whole or in part, at our
option or the holder's, and may be mandatorily redeemed.
Any restriction on the repurchase or redemption by us of our preferred stock
while we are in arrears in the payment of dividends will be described in the
applicable prospectus supplement.
Any partial redemptions of preferred stock will be made in a way that our
board of directors decides is equitable.
Unless we default in the payment of the redemption price, dividends will
cease to accrue after the redemption date of shares of preferred stock called
for redemption and all rights of holders of these shares will terminate except
for the right to receive the redemption price.
Dividends
Holders of each series of preferred stock will be entitled to receive cash
dividends when, as and if declared by our board of directors out of funds
legally available for dividends. The rates and dates of payment of dividends
will be set forth in the applicable prospectus supplement relating to each
series of preferred stock. Dividends will be payable to holders of record of
preferred stock as they appear on our books on the record dates fixed by the
board of directors. Dividends on any series of preferred stock may be
cumulative or noncumulative.
We may not declare, pay or set apart funds for payment of dividends on a
particular series of preferred stock unless full dividends on any other series
of preferred stock that ranks equally with or senior to the series of preferred
stock have been paid or sufficient funds have been set apart for payment for
either of the following:
. all prior dividend periods of the other series of preferred stock that
pay dividends on a cumulative basis; or
. the immediately preceding dividend period of the other series of
preferred stock that pay dividends on a noncumulative basis.
Partial dividends declared on shares of any series of preferred stock and
other series of preferred stock ranking on an equal basis as to dividends will
be declared pro rata. A pro rata declaration means that the ratio of dividends
declared per share to accrued dividends per share will be the same for both
series of preferred stock.
Liquidation Preference
In the event of our liquidation, dissolution or winding-up, holders of each
series of our preferred stock will have the right to receive distributions upon
liquidation in the amount described in the applicable prospectus supplement
relating to each series of preferred stock, plus an amount equal to any accrued
and unpaid dividends. These distributions will be made before any distribution
is made on the common stock or on any securities ranking junior to the
preferred stock upon liquidation, dissolution or winding-up.
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If the liquidation amounts payable relating to the preferred stock of any
series and any other securities ranking on a parity regarding liquidation
rights are not paid in full, the holders of the preferred stock of these series
and other securities will have the right to a ratable portion of our available
assets, up to the full liquidation preference. Holders of these series of
preferred stock or other securities will not be entitled to any other amounts
from us after they have received their full liquidation preference.
Voting Rights
The holders of shares of preferred stock will have no voting rights, except:
. as otherwise stated in the applicable prospectus supplement;
. as otherwise stated in the certificate of designations establishing the
series; or
. as required by applicable law.
Transfer Agent and Registrar
The transfer agent, registrar and dividend disbursement agent for the
preferred stock will be stated in the applicable prospectus supplement. The
registrar for shares of preferred stock will send notices to shareholders of
any meetings at which holders of the preferred stock have the right to elect
directors or to vote on any other matter.
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DESCRIPTION OF DEPOSITARY SHARES
The following briefly summarizes the provisions of the depositary shares and
depositary receipts that we may issue from time to time and which would be
important to holders of depositary receipts, other than pricing and related
terms which will be disclosed in the applicable prospectus supplement. The
prospectus supplement will also state whether any of the generalized provisions
summarized below do not apply to the depositary shares or depositary receipts
being offered. The following description and any description in a prospectus
supplement may not be complete and is subject to, and qualified in its entirety
by reference to the terms and provisions of the deposit agreement which we will
file with the SEC at or prior to the time we issue the depositary shares.
Description of Depositary Shares
We may offer depositary shares evidenced by depositary receipts. Each
depositary receipt represents a fraction of a share of the particular series of
preferred stock issued and deposited with a depositary. The fraction of a share
of preferred stock which each depositary share represents will be set forth in
the applicable prospectus supplement.
We will deposit the shares of any series of preferred stock represented by
depositary shares according to the provisions of a deposit agreement to be
entered into between us and a bank or trust company which we will select as our
preferred stock depositary. The depositary must have its principal office in
the United States and have a combined capital and surplus of at least
$50,000,000. We will name the depositary in the applicable prospectus
supplement. Each owner of a depositary share will be entitled to all the rights
and preferences of the underlying preferred stock in proportion to the
applicable fraction of a share of preferred stock represented by the depositary
share. These rights include dividend, voting, redemption, conversion and
liquidation rights. The depositary will send the holders of depositary shares
all reports and communications that we deliver to the depositary and which we
are required to furnish to the holders of depositary shares.
Depositary Receipts
The depositary shares will be evidenced by depositary receipts issued
pursuant to the deposit agreement. Depositary receipts will be distributed to
anyone who is buying the fractional shares of preferred stock in accordance
with the terms of the applicable prospectus supplement.
While definitive engraved depositary receipts (certificates) are being
prepared, we may instruct the depositary to issue temporary depositary
receipts, which will entitle holders to all the rights of the definitive
depositary receipts and be substantially in the same form. The depositary will
prepare definitive depositary receipts without unreasonable delay, and we will
pay for the exchange of your temporary depositary receipts for definitive
depositary receipts.
Withdrawal of Preferred Stock
A holder of depositary shares may receive the number of whole shares of the
series of preferred stock and any money or other property represented by the
holder's depositary receipts after surrendering the depositary receipts at the
corporate trust office of the depositary. Partial shares of preferred stock
will not be issued. If the surrendered depositary shares exceed the number of
depositary shares that represent the number of whole shares of preferred stock
the holder wishes to withdraw, then the depositary will deliver to the holder
at the same time a new depositary receipt evidencing the excess number of
depositary shares. Once the holder has withdrawn the preferred stock, the
holder will not be entitled to re-deposit that preferred stock under the
deposit agreement or to receive depositary shares in exchange for such
preferred stock. We do not expect that there will be any public trading market
for withdrawn shares of preferred stock.
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Dividends and Other Distributions
The depositary has agreed to pay to holders of depositary shares the cash
dividends or other cash distributions it receives on preferred stock, after
deducting its fees and expenses. Each holder will receive these distributions
in proportion to the number of depositary shares owned by the holder. The
depositary will distribute only whole U.S. dollars and cents. The depositary
will add any fractional cents not distributed to the next sum received for
distribution to record holders of depositary shares.
In the event of a non-cash distribution, the depositary will distribute
property to the record holders of depositary shares, unless the depositary
determines that it is not feasible to make such a distribution. If this occurs,
the depositary may, with our approval, sell the property and distribute the net
proceeds from the sale to the holders.
Redemption of Depositary Shares
If the series of preferred stock represented by depositary shares is subject
to redemption, then we will give the necessary proceeds to the depositary. The
depositary will then redeem the depositary shares using the funds they received
from us for the preferred stock. The depositary will notify the record holders
of the depositary shares to be redeemed not less than 30 nor more than 60 days
before the date fixed for redemption at the holders' addresses appearing in the
depositary's books. The redemption price per depositary share will be equal to
the redemption price payable per share for the applicable series of the
preferred stock and any other amounts per share payable with respect to the
preferred stock multiplied by the fraction of a share of preferred stock
represented by one depositary share. Whenever we redeem shares of preferred
stock held by the depositary, the depositary will redeem the depositary shares
representing the shares of preferred stock on the same day. If fewer than all
the depositary shares of a series are to be redeemed, the depositary shares
will be selected by lot or ratably as the depositary will decide.
After the date fixed for redemption, the depositary shares called for
redemption will no longer be considered outstanding. Therefore, all rights of
holders of the depositary shares will cease, except that the holders will still
be entitled to receive any cash payable upon the redemption and any money or
other property to which the holder was entitled at the time of redemption.
Voting the Preferred Stock
Upon receipt of notice of any meeting at which the holders of preferred
stock are entitled to vote, the depositary will notify holders of depositary
shares of the upcoming vote and arrange to deliver our voting materials to the
holders. The record date for determining holders of depositary shares that are
entitled to vote will be the same as the record date for the preferred stock.
The materials the holders will receive will (1) describe the matters to be
voted on and (2) explain how the holders, on a certain date, may instruct the
depositary to vote the shares of preferred stock underlying the depositary
shares. For instructions to be valid, the depositary must receive them on or
before the date specified. The depositary will try, as far as practical, to
vote the shares as instructed by the holder. We will do anything the depositary
asks us to do in order to enable it to vote as a holder has instructed. If any
holder does not instruct the depositary how to vote the holder's shares, the
depositary will abstain from voting those shares.
Conversion or Exchange
The depositary will convert or exchange all depositary shares on the same
day that the preferred stock underlying the depositary shares is converted or
exchanged. In order for the depositary to do so, we will need to deposit the
other preferred stock, common stock or other securities into which the
preferred stock is to be converted or for which it will be exchanged.
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The exchange or conversion rate per depositary share will be equal to:
. the exchange or conversion rate per share of preferred stock, multiplied
by the fraction of a share of preferred stock represented by one
depositary share;
. plus all money and any other property represented by one depositary
share; and
. including all amounts per depositary share paid by us for dividends that
have accrued on the preferred stock on the exchange or conversion date
and that have not yet been paid.
The depositary shares, as such, cannot be converted or exchanged into other
preferred stock, common stock, securities of another issuer or any other
securities or property of us. Nevertheless, if so specified in the applicable
prospectus supplement, a holder of depositary shares may be able to surrender
the depositary receipts to the depositary with written instructions asking the
depositary to instruct us to convert or exchange the preferred stock
represented by the depositary shares into other shares of our preferred stock
or common stock or to exchange the preferred stock for securities of another
issuer. If the depositary shares carry this right, we would agree that, upon
the payment of any applicable fees, we will cause the conversion or exchange of
the preferred stock using the same procedures as we use for the delivery of
preferred stock. If a holder is only converting part of the depositary shares
represented by a depositary receipt, new depositary receipts will be issued for
any depositary shares that are not converted or exchanged.
Amendment and Termination of the Deposit Agreement
We may agree with the depositary to amend the deposit agreement and the form
of depositary receipt without consent of the holder at any time. However, if
the amendment adds or increases fees or charges or prejudices an important
right of holders, it will only become effective with the approval of holders of
at least a majority of the affected depositary shares then outstanding. If an
amendment becomes effective, holders are deemed to agree to the amendment and
to be bound by the amended deposit agreement if they continue to hold their
depositary receipts.
The deposit agreement automatically terminates if:
. all outstanding depositary shares have been redeemed;
. each share of preferred stock has been converted into or exchanged for
common stock; or
. a final distribution in respect of the preferred stock has been made to
the holders of depositary receipts in connection with our liquidation,
dissolution or winding-up.
We may also terminate the deposit agreement at any time we wish. If we do
so, the depositary will give notice of termination to the holders not less than
30 days before the termination date. Once depositary receipts are surrendered
to the depositary, it will send to each holder the number of whole or
fractional shares of the series of preferred stock underlying that holder's
depositary receipts.
Charges of Depositary and Expenses
We will pay all transfer and other taxes and governmental charges in
connection with the existence of the depositary arrangements. We will pay
charges of the depositary for the initial deposit of the preferred stock and
any redemption of the preferred stock. Holders of depositary shares will pay
other transfer and other taxes and governmental charges and the charges that
are expressly provided in the deposit agreement to be for the holders account.
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Limitations on Our Obligations and Liability to Holders of Depositary Receipts
The deposit agreement expressly limits our obligations and the obligations
of the depositary. It also limits our liability and the liability of the
depositary as follows:
. we and the depositary are only obligated to take the actions
specifically set forth in the deposit agreement in good faith;
. we and the depositary are not liable if either of us is prevented or
delayed by law or circumstances beyond our control from performing our
obligations under the deposit agreement;
. we and the depositary are not liable if either of us exercises
discretion permitted under the deposit agreement;
. we and the depositary have no obligation to become involved in any legal
or other proceeding related to the depositary receipts or the deposit
agreement on your behalf or on behalf of any other party, unless you
provide us with satisfactory indemnity; and
. we and the depositary may rely upon any written advice of counsel or
accountants and on any documents we believe in good faith to be genuine
and to have been signed or presented by the proper party.
In the deposit agreement, we and the depositary will agree to indemnify each
other under certain circumstances.
Resignation and Removal of Depositary
The depositary may resign at any time by notifying us of its election to do
so. In addition, we may remove the depositary at any time. The resignation or
removal will take effect when we appoint a successor depositary and it accepts
the appointment. We must appoint the successor depositary within 60 days after
delivery of the notice of resignation or removal and the new depositary must be
a bank or trust company having its principal office in the United States and
having a combined capital and surplus of at least $50,000,000.
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DESCRIPTION OF COMMON STOCK
The following briefly summarizes the provisions of our restated certificate
of incorporation and bylaws that would be important to holders of our common
stock. The following description may not be complete and is subject to, and
qualified in its entirety by reference to, the terms and provisions of our
restated certificate of incorporation and bylaws which we have filed as
exhibits to the registration statement which contains this prospectus.
General
Under our restated certificate of incorporation, we are authorized to issue
a total of 725,000,000 shares of common stock having a par value of $.10 per
share. As of June 30, 2000 240,657,154 shares of common stock were outstanding,
which were held by approximately 22,866 shareholders of record. All outstanding
shares of common stock are fully paid and nonassessable. The common stock is
listed on the New York Stock Exchange.
Holders of common stock do not have any conversion, redemption, preemptive
or cumulative voting rights. In the event of our dissolution, liquidation or
winding-up, common stockholders will share ratably in any assets remaining
after all creditors are paid in full, including holders of our debt securities,
and after the liquidation preference of holders of preferred stock has been
satisfied.
Dividends
Holders of common stock are entitled to participate equally in dividends
when the board of directors declares dividends on shares of common stock out of
funds legally available for dividends. The rights of holders of common stock to
receive dividends are subject to the preferences of holders of preferred stock.
Voting Rights
Holders of common stock are entitled to one vote for each share held of
record on all matters voted on by stockholders, including the election of
directors.
Liquidation Rights
In the event of our liquidation, dissolution or winding-up, holders of
common stock have the right to a ratable portion of assets remaining after
satisfaction in full of the prior rights of our creditors, all liabilities, and
the total liquidation preferences of any outstanding shares of preferred stock.
Certain Provisions That May Have an Anti-Takeover Effect
Our restated certificate of incorporation and bylaws and certain portions of
Delaware law, contain certain provisions that may have an anti-takeover effect.
Board of Directors Classification. We have a staggered or classified board
of directors. Our board of directors is divided into three classes with the
members of each class serving a three-year term. The members of only one class
of directors are elected at any annual meeting of our stockholders. It
therefore takes at least two years to elect a majority of our directors.
Business Combination. We cannot enter into business combinations with a
person who is an "interested stockholder" unless the business combination
transaction is approved by a vote of not less than 80% of the votes entitled to
be cast on the transaction, including a majority of the votes that are not the
votes of the interested stockholder.
An "interested stockholder" is generally any person that owns, or has owned
in the two-year period prior to the date in question, shares of our voting
stock that represent 15% or more of the votes entitled to be cast by the
holders of the shares of our outstanding voting stock.
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A "business combination" is generally a merger or consolidation involving a
company, a disposition of a substantial part of the assets or securities of a
company, a liquidation or dissolution of a company, or a certain type of
reclassification of securities of a company.
The supermajority vote requirements described above will not apply to
business combinations with interested stockholders if the transaction has been
approved by a majority of our directors (or their successors) who are not
affiliates of the interested stockholder and were our directors before the
interested stockholder became an interested stockholder.
We are also subject to restrictions imposed by Delaware law on transactions
with interested stockholders. These restrictions are similar to the
restrictions contained in our restated certificate of incorporation described
above. In order to engage in any transaction that is subject to the provisions
of our restated certificate of incorporation or the provisions of Delaware law,
the requirements of both the restated certificate of incorporation and Delaware
law must be satisfied.
Special Meetings of Stockholders. Only our Chairman of the Board, our Chief
Executive Officer or our President may call a special meeting of our
stockholders and these meetings are to be called by any such officer at the
request of a majority of the board of directors.
Action of Stockholders Without a Meeting. Any action of our stockholders may
be taken at a meeting only and may not be taken by written consent.
Amendment of Certificate of Incorporation. For us to amend our restated
certificate of incorporation, Delaware law requires that our board of directors
adopt a resolution setting forth any amendment, declare the advisability of the
amendment and call a stockholders' meeting to adopt the amendment. Generally,
amendments to our restated certificate of incorporation require the affirmative
vote of majority of our outstanding stock. As described below, however, certain
amendments to our restated certificate of incorporation may require a
supermajority vote.
The vote of the holders of not less than 80% of the votes entitled to be
cast is required to adopt any amendment to our restated certificate of
incorporation that relates to the provisions of our restated certificate of
incorporation that govern the following matters:
. management of our business by the directors and classification of our
board of directors;
. the ability of our stockholders to act by written consent; and
. the power of the board of directors and the stockholders to amend the
bylaws.
The vote of the holders of not less than 80% of the votes entitled to be
cast, including the majority of the votes that are not the votes of an
interested stockholder, is required to adopt any amendment to our restated
certificate of incorporation that relates to the provisions of our restated
certificate of incorporation that govern the following matters:
. the provisions regarding "business combinations" with interested
stockholders; and
. the provisions setting forth the supermajority vote requirements for
amending the restated certificate of incorporation.
These supermajority vote provisions for amending the certificate of
incorporation do not apply if the amendment is recommended by a majority of our
directors (or their successors) who are not affiliates of an interested
stockholder and were our directors before the interested stockholder became an
interested stockholder.
The provisions described above may discourage attempts by others to acquire
control of us without negotiation with our board of directors. This enhances
our board of directors' ability to attempt to promote the
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interests of all of our stockholders. However, to the extent that these
provisions make us a less attractive takeover candidate, they may not always be
in our best interests or in the best interests of our stockholders. None of
these provisions is the result of any specific effort by a third party to
accumulate our securities or to obtain control of us by means of merger, tender
offer, solicitation in opposition to management or otherwise.
Transfer Agent and Registrar
The transfer agent and registrar for shares of the common stock is Boston
EquiServe L.P.
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DESCRIPTION OF WARRANTS
General
We may issue warrants to purchase senior debt securities, subordinated debt
securities, preferred stock, common stock or any combination of these
securities and these warrants may be issued independently or together with any
underlying securities and may be attached or separate from the underlying
securities. We will issue each series of warrants under a separate warrant
agreement to be entered into between us and a warrant agent. The warrant agent
will act solely as our agent in connection with the warrants of such series
and will not assume any obligation or relationship of agency for or with
holders or beneficial owners of warrants. The following outlines some of the
general terms and provisions of the warrants. Further terms of the warrants
and the applicable warrant agreement will be stated in the applicable
prospectus supplement. The following description and any description of the
warrants in a prospectus supplement may not be complete and is subject to and
qualified in its entirety by reference to the terms and provisions of the
warrant agreement which we will file with the SEC at or prior to the time we
issue the warrants.
The applicable prospectus supplement will describe the terms of any
warrants, including the following:
. the title of the warrants;
. the total number of warrants;
. the price or prices at which we will issue the warrants;
. the currency or currencies investors may use to pay for the warrants;
. the designation and terms of the underlying securities purchasable upon
exercise of the warrants;
. the price at which and the currency or currencies, including composite
currencies, in which investors may purchase the underlying securities
purchasable upon exercise of the warrants;
. the date on which the right to exercise the warrants will commence and
the date on which the right will expire;
. whether we will issue the warrants in registered form or bearer form;
. information with respect to book-entry procedures, if any;
. if applicable, the minimum or maximum amount of warrants which may be
exercised at any one time;
. if applicable, the designation and terms of the underlying securities
with which the warrants are issued and the number of warrants issued
with each underlying security;
. if applicable, the date on and after which the warrants and the related
underlying securities will be separately transferable;
. if applicable, a discussion of material United States federal income tax
considerations;
. the identity of the warrant agent;
. the procedures and conditions relating to the exercise of the warrants;
and
. any other terms of the warrants, including terms, procedures and
limitations relating to the exchange and exercise of the warrants.
Warrant certificates may be exchanged for new warrant certificates of
different denominations, and warrants may be exercised at the warrant agent's
corporate trust office or any other office indicated in the applicable
prospectus supplement. Prior to the exercise of their warrants, holders of
warrants exercisable for debt securities will not have any of the rights of
holders of the debt securities purchasable upon such exercise and will not be
entitled to payments of principal (or premium, if any) or interest, if any, on
the debt securities
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purchasable upon such exercise. Prior to the exercise of their warrants,
holders of warrants exercisable for shares of preferred stock or common stock
will not have any rights of holders of the preferred stock or common stock
purchasable upon such exercise and will not be entitled to dividend payments,
if any, or voting rights of the preferred stock or common stock purchasable
upon such exercise.
Exercise of Warrants
A warrant will entitle the holder to purchase for cash an amount of
securities at an exercise price that will be stated in, or that will be
determinable as described in, the applicable prospectus supplement. Warrants
may be exercised at any time up to the close of business on the expiration date
set forth in the applicable prospectus supplement. After the close of business
on the expiration date, unexercised warrants will become void.
Warrants may be exercised as set forth in the applicable prospectus
supplement. Upon receipt of payment and the warrant certificate properly
completed and duly executed at the corporate trust office of the warrant agent
or any other office indicated in the prospectus supplement, we will, as soon as
practicable, forward the securities purchasable upon such exercise. If less
than all of the warrants represented by such warrant certificate are exercised,
a new warrant certificate will be issued for the remaining warrants.
Enforceability of Rights; Governing Law
The holders of warrants, without the consent of the warrant agent, may, on
their own behalf and for their own benefit, enforce, and may institute and
maintain any suit, action or proceeding against us to enforce their rights to
exercise and receive the securities purchasable upon exercise of their
warrants. Unless otherwise stated in the prospectus supplement, each issue of
warrants and the applicable warrant agreement will be governed by the laws of
the State of New York.
DESCRIPTION OF STOCK PURCHASE CONTRACTS
AND STOCK PURCHASE UNITS
We may issue stock purchase contracts, representing contracts obligating
holders to purchase from us, and obligating us to sell to the holders, a
specified number of shares of our common stock at a future date or dates. The
price per share of common stock may be fixed at the time the stock purchase
contracts are issued or may be determined by reference to a specific formula
contained in the stock purchase contracts. The stock purchase contracts may be
issued separately or as a part of units consisting of a stock purchase contract
and our senior debt securities or subordinated debt securities or debt
obligations of third parties, including U.S. Treasury securities, securing the
holders' obligations to purchase the common stock under the stock purchase
contracts.
Stock purchase contracts may require us to make periodic payments to the
holders of the units or vice versa, and these payments may be unsecured or
prefunded on some basis. The stock purchase contracts may require holders to
secure their obligations under the contracts in a specific manner.
The applicable prospectus supplement will describe the terms of any stock
purchase contracts or units. The description in the applicable prospectus
supplement will not purport to be complete and will be qualified in its
entirety by reference to the stock purchase contracts and, if applicable,
collateral arrangements and depositary arrangements relating to such stock
purchase contracts or units.
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DESCRIPTION OF PREFERRED SECURITIES
General
The following summary outlines the material terms and provisions of the
preferred securities that the trusts may offer. The particular terms of any
preferred securities a trust offers and the extent if any to which these
general terms and provisions may or may not apply to the preferred securities
will be described in the applicable prospectus supplement.
Each trust will issue the preferred securities under an amended
declaration, which we will enter into with the trustees. The amended
declaration for each trust is subject to and governed by the Trust Indenture
Act of 1939 and The Chase Manhattan Bank, an independent trustee, will act as
property trustee under each amended declaration for the purposes of compliance
with the provisions of the Trust Indenture Act. The terms of the preferred
securities will be those contained in the applicable amended declaration and
those made part of the amended declaration by the Trust Indenture Act. The
following summary may not be complete and is subject to and qualified in its
entirety by reference to the form of amended declaration, which is filed as an
exhibit to the registration statement which contains this prospectus, and the
Trust Indenture Act.
Terms
Each amended declaration will provide that a trust may issue, from time to
time, only one series of preferred securities and one series of common
securities. The preferred securities will be offered to investors and the
common securities will initially be held by us. The terms of the preferred
securities, as a general matter, will mirror the terms of the junior
subordinated debt securities that we will issue to a trust in exchange for the
proceeds of the sales of the preferred and common securities. If we fail to
make a payment on the junior subordinated debt securities, the trust holding
those securities will not have sufficient funds to make related payments,
including distributions, on its preferred securities.
You should refer to the applicable prospectus supplement relating to the
preferred securities for specific terms of the preferred securities,
including, but not limited to:
(1) the distinctive designation of the preferred securities;
(2) the total and per security liquidation amount of the preferred
securities;
(3) the annual distribution rate, or method of determining the rate at
which the trust issuing the securities will pay distributions, on the
preferred securities and the date or dates from which distributions will
accrue;
(4) the date or dates on which the distributions will be payable and any
corresponding record dates;
(5) whether distributions on preferred securities will be cumulative,
and, in the case of preferred securities having cumulative distribution
rights, the date or dates or method of determining the date or dates from
which distributions on preferred securities will be cumulative;
(6) the right, if any, to defer distributions on the preferred
securities upon extension of the interest payment period of the related
junior subordinated debt securities;
(7) whether the preferred securities are to be issued in book-entry form
and represented by one or more global certificates and, if so, the
depositary for the global certificates and the specific terms of the
depositary arrangement;
(8) the amount or amounts which will be paid out of the assets of the
trust issuing the securities to the holders of preferred securities upon
voluntary or involuntary dissolution, winding-up or termination of the
trust issuing the securities;
(9) any obligation of the trust issuing the securities to purchase or
redeem preferred securities and the terms and conditions relating to any
redemption obligation;
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(10) any voting rights of the preferred securities;
(11) any terms and conditions upon which the junior subordinated debt
securities held by the trust issuing the securities may be distributed to
holders of preferred securities;
(12) any securities exchange on which the preferred securities will be
listed; and
(13) any other relevant rights, preferences, privileges, limitations or
restrictions of the preferred securities not inconsistent with the amended
declaration or with applicable law.
We will guarantee the preferred securities to the extent described below
under "DESCRIPTION OF TRUST GUARANTEES." Our guarantee, when taken together
with our obligations under the junior subordinated debt securities and the
related subordinated indenture, and our obligations under the amended
declaration, would provide a full and unconditional guarantee of amounts due on
any preferred securities. Certain United States federal income tax
considerations applicable to any offering of preferred securities will be
described in the applicable prospectus supplement.
Liquidation Distribution Upon Dissolution
Unless otherwise specified in an applicable prospectus supplement, each
amended declaration states that each trust will be dissolved:
. on the expiration of the term of that trust;
. upon our bankruptcy, dissolution or liquidation;
. upon our written direction to the property trustee to dissolve the trust
and distribute the related junior subordinated debt securities directly
to the holders of the trust securities;
. upon the redemption of all of the preferred securities in connection
with the redemption of all of the related junior subordinated debt
securities; or
. upon entry of a court order for the dissolution of the trust.
Unless otherwise specified in an applicable prospectus supplement, in the
event of a dissolution as described above other than in connection with
redemption, after a trust satisfies all liabilities to its creditors as
provided by applicable law, each holder of the preferred or common securities
issued by that trust will be entitled to receive:
. the related junior subordinated debt securities in an aggregate
principal amount equal to the aggregate liquidation amount of the
preferred or common securities held by the holder; or
. if any distribution of the related junior subordinated debt securities
is determined by the property trustee not to be practical, cash equal to
the aggregate liquidation amount of the preferred or common securities
held by the holder, plus accumulated and unpaid distributions to the
date of payment.
If a trust cannot pay the full amount due on its preferred and common
securities because it has insufficient assets available for payment, then the
amounts payable by that trust on its preferred and common securities will be
paid on a pro rata basis. However, if certain payment events of default under
the subordinated indenture have occurred and are continuing with respect to any
series of related junior subordinated debt securities, the total amounts due on
the preferred securities will be paid before any distribution on the common
securities.
Events of Default
The following will be events of default under each amended declaration:
. an event of default under the subordinated indenture occurs with respect
to any related series of junior subordinated debt securities; or
. any other event of default specified in the applicable prospectus
supplement occurs.
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If an event of default with respect to a related series of junior
subordinated debt securities occurs and is continuing under the subordinated
indenture, and the subordinated indenture trustee or the holders of not less
than 25% in principal amount of the related junior subordinated debt securities
outstanding fail to declare the principal amount of all of such junior
subordinated debt securities to be immediately due and payable, the holders of
at least 25% in aggregate liquidation amount of the outstanding preferred
securities of the trust holding the junior subordinated debt securities, will
have the right to declare such principal amount immediately due and payable by
providing written notice to us, the applicable property trustee and the
subordinated indenture trustee.
At any time after a declaration of acceleration has been made with respect
to a related series of junior subordinated debt securities and before a
judgment or decree for payment of the money due has been obtained, the holders
of a majority in liquidation amount of the affected preferred securities may
rescind any declaration of acceleration with respect to the related junior
subordinated debt securities and its consequences:
. if we deposit with the subordinated indenture trustee funds sufficient
to pay all overdue principal of and premium and interest on the related
junior subordinated debt securities and other amounts due to the
subordinated indenture trustee and the property trustee; and
. if all existing events of default with respect to the related junior
subordinated debt securities have been cured or waived except non-
payment of principal on the related junior subordinated debt securities
that has become due solely because of the acceleration.
The holders of a majority in liquidation amount of the affected preferred
securities may waive any past default under the subordinated debenture
indenture with respect to related junior subordinated debt securities, other
than a default in the payment of principal of, or any premium or interest on,
any related junior subordinated debenture or a default with respect to a
covenant or provision that cannot be amended or modified without the consent of
the holder of each affected outstanding related junior subordinated debenture.
In addition, the holders of at least a majority in liquidation amount of the
affected preferred securities may waive any past default under the amended
declaration.
The holders of a majority in liquidation amount of the affected preferred
securities shall have the right to direct the time, method and place of
conducting any proceedings for any remedy available to the property trustee or
to direct the exercise of any trust or power conferred on the property trustee
under the amended declaration.
A holder of preferred securities may institute a legal proceeding directly
against us, without first instituting a legal proceeding against the property
trustee or anyone else, for enforcement of payment to the holder of principal
and any premium or interest on the related series of junior subordinated debt
securities having a principal amount equal to the aggregate liquidation amount
of the preferred securities of the holder, if we fail to pay principal and any
premium or interest on the related series of junior subordinated debt
securities when payable.
We are required to furnish annually, to the property trustee for each trust,
officers' certificates to the effect that, to the best knowledge of the
individuals providing the certificates, we and each trust are not in default
under the applicable amended declaration or, if there has been a default,
specifying the default and its status.
Consolidation, Merger or Amalgamation of the Trust
No trust may merge with or into, amalgamate, consolidate, or be replaced by,
or convey, transfer or lease its properties and assets substantially as an
entirety to, any entity, except as described below or as described in "--
Liquidation Distribution Upon Dissolution." A trust may, with the consent of
the administrative trustees but without the consent of the holders of the
outstanding preferred securities or the other trustees of that trust,
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merge with or into, amalgamate, consolidate, or be replaced by, or convey,
transfer or lease its properties and assets substantially as an entirety to, a
trust organized under the laws of any State if:
(1) the successor entity either:
. expressly assumes all of the obligations of the trust relating to its
preferred securities, or
. substitutes for the trust's preferred securities other securities
having substantially the same terms as the preferred securities, so
long as the substituted successor securities rank the same as the
preferred securities for distributions and payments upon liquidation,
redemption and otherwise;
(2) we appoint a trustee of the successor entity who has substantially
the same powers and duties as the property trustee of the trust;
(3) the successor securities are listed or traded, or any substituted
successor securities will be listed upon notice of issuance, on the same
national securities exchange or other organization on which the preferred
securities are then listed or traded;
(4) the merger event does not cause the preferred securities or any
substituted successor securities to be downgraded by any national rating
agency;
(5) the merger event does not adversely affect the rights, preferences
and privileges of the holders of the preferred securities or any
substituted successor securities in any material respect;
(6) the successor entity has a purpose substantially identical to that
of the trust that issued the securities;
(7) prior to the merger event, we shall provide to the property trustee
an opinion of counsel from a nationally recognized law firm stating that:
. the merger event does not adversely affect the rights, preferences
and privileges of the holders of the trust's preferred securities in
any material respect, and
. following the merger event, neither the trust nor the successor
entity will be required to register as an investment company under
the Investment Company Act of 1940; and
(8) we own or our permitted transferee owns, all of the common
securities of the successor entity and we guarantee or our permitted
transferee guarantees the obligations of the successor entity under the
substituted successor securities at least to the extent provided under the
applicable preferred securities guarantee.
In addition, unless all of the holders of the preferred securities approve
otherwise, no trust may consolidate, amalgamate or merge with or into, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to, any other entity, or permit any other entity
to consolidate, amalgamate, merge with or into or replace it if the
transaction would cause that trust or the successor entity to be taxable as a
corporation or classified other than as a grantor trust for United States
federal income tax purposes.
Voting Rights
Unless otherwise specified in the applicable prospectus supplement, the
holders of the preferred securities will have no voting rights except as
discussed below and under "--Amendment to the Trust Agreement" and
"DESCRIPTION OF TRUST GUARANTEES--Modification of the Trust Guarantee;
Assignment" and as otherwise required by law.
If any proposed amendment to an amended declaration provides for, or the
trustees of a trust otherwise propose to effect:
. any action that would adversely affect the powers, preferences or
special rights of the preferred securities in any material respect,
whether by way of amendment to the amended declaration or otherwise; or
. the dissolution, winding-up or termination of a trust other than
pursuant to the terms of the amended declaration,
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then the holders of the affected preferred securities as a class will be
entitled to vote on the amendment or proposal. In that case, the amendment or
proposal will be effective only if approved by the holders of at least a
majority in aggregate liquidation amount of the affected preferred securities.
Without obtaining the prior approval of the holders of a majority in
aggregate liquidation amount of the preferred securities issued by a trust, the
trustees of that trust may not:
. direct the time, method and place of conducting any proceeding for any
remedy available to the subordinated indenture trustee for any related
junior subordinated debt securities or direct the exercise of any trust
or power conferred on the property trustee with respect to the related
junior subordinated debt securities;
. waive any default that is waivable under the subordinated indenture with
respect to any related junior subordinated debt securities;
. cancel an acceleration of the principal of the related junior
subordinated debt securities; or
. consent to any amendment, modification or termination of the
subordinated indenture or any related junior subordinated debt
securities where consent is required.
However, if a consent under the subordinated indenture requires the consent of
each affected holder of the related junior subordinated debt securities, then
the property trustee must obtain the prior consent of each holder of the
preferred securities of the trust that holds the related junior subordinated
debt securities. In addition, before taking any of the foregoing actions, we
will provide to the property trustee an opinion of counsel experienced in such
matters to the effect that, as a result of such actions, the trust will not be
taxable as a corporation or classified as other than a grantor trust for United
States federal income tax purposes.
The property trustee will notify all preferred securities holders of a trust
of any notice of default received from the subordinated indenture trustee with
respect to the junior subordinated debt securities held by that trust.
Any required approval of the holders of preferred securities may be given at
a meeting of the holders of the preferred securities convened for the purpose
or pursuant to written consent. The applicable property trustee will cause a
notice of any meeting at which holders of securities are entitled to vote to be
given to each holder of record of the preferred securities at the holder's
registered address at least 15 days and not more than 90 days before the
meeting.
No vote or consent of the holders of the trust securities will be required
for a trust to redeem and cancel its trust securities in accordance with its
amended declaration.
Notwithstanding that holders of the preferred securities are entitled to
vote or consent under any of the circumstances described above, any of the
preferred securities that are owned by us, any trustee or any affiliate of a
trustee or ours will, for purposes of any vote or consent, be treated as if
they were not outstanding. Preferred securities held by us or any of our
affiliates may be exchanged for related junior subordinated debt securities at
the election of the holder.
Amendment to the Trust Agreement
An amended declaration may be amended from time to time by us and the
property trustee and the administrative trustees of each trust without the
consent of the holders of the preferred securities of that trust to:
. cure any ambiguity or correct or supplement any provision which may be
inconsistent with any other provisions with respect to matters or
questions arising under the amended declaration, in each case to the
extent that the amendment does not adversely affect the interests of any
holder of the preferred securities in any material respect; or
. modify, eliminate or add to any provisions to the extent necessary to
ensure that the trust will not be taxable as a corporation or classified
as other than a grantor trust for United States federal income tax
purposes, to ensure that the junior subordinated debt securities held by
the trust are treated as indebtedness for United States federal income
tax purposes or to ensure that the trust will not be required to
register as an investment company under the Investment Company Act of
1940.
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Other amendments to an amended declaration of trust may be made by us and
the trustees of that trust upon approval of the holders of a majority in
aggregate liquidation amount of the outstanding preferred securities of that
trust and receipt by the trustees of an opinion of counsel to the effect that
the amendment will not cause the trust to be taxable as a corporation or
classified as other than a grantor trust for United States federal income tax
purposes, affect the treatment of the junior subordinated debt securities held
by the trust as indebtedness for United States federal income tax purposes or
affect the trust's exemption from the Investment Company Act of 1940.
Notwithstanding the foregoing, without the consent of each affected holder
of common or preferred securities of each trust, an amended declaration may not
be amended to:
. change the amount or timing of any distribution on the common or
preferred securities of a trust or otherwise adversely affect the amount
of any distribution required to be made in respect of the securities as
of a specified date; or
. restrict the right of a holder of any securities to institute suit for
the enforcement of any payment on or after the distribution date.
In addition, no amendment may be made to an amended declaration if the
amendment would:
. cause a trust to be taxable as a corporation or characterized as other
than a grantor trust for United States federal income tax purposes;
. cause the junior subordinated debt securities held by a trust to not be
treated as indebtedness for United States federal income tax purposes;
. cause a trust to be deemed to be an investment company required to be
registered under the Investment Company Act of 1940; or
. impose any additional obligation on us without our consent.
Removal and Replacement of Trustees
The holder of a trust's common securities may, upon prior written notice,
remove or replace any of the administrative trustees and, unless an event of
default has occurred and is continuing under the subordinated indenture, the
property and Delaware trustee of the trust. If an event of default has occurred
and is continuing under the subordinated indenture, only the holders of a
majority in liquidation amount of the trust's preferred securities may remove
or replace the property trustee and Delaware trustee. The resignation or
removal of any trustee will be effective only upon the acceptance of
appointment by the successor trustee in accordance with the provisions of the
applicable amended declaration.
Merger or Consolidation of Trustees
Any entity into which a property trustee or the Delaware trustee may be
merged or converted or with which it may be consolidated, or any entity
resulting from any merger, conversion or consolidation to which the trustee
shall be a party, or any entity succeeding to all or substantially all of the
corporate trust business of the trustee, shall be the successor of the trustee
under the applicable amended declaration; provided, however, that the entity
shall be otherwise qualified and eligible.
Information Concerning the Property Trustee
For matters relating to compliance with the Trust Indenture Act of 1939, the
property trustee for each trust will have all of the duties and
responsibilities of an indenture trustee under the Trust Indenture Act of 1939.
The property trustee, other than during the occurrence and continuance of a
default under an amended declaration, undertakes to perform only the duties as
are specifically set forth in the amended declaration and,
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after a default, must use the same degree of care and skill as a prudent person
would exercise or use in the conduct of his or her own affairs. The property
trustee is under no obligation to exercise any of the powers given it by an
amended declaration at the request of any holder of the preferred securities
unless it is offered security or indemnity satisfactory to it against the
costs, expenses and liabilities that it might incur. If the property trustee is
required to decide between alternative courses of action, construe ambiguous
provisions in an amended declaration or is unsure of the application of any
provision of the amended declaration, and the matter is not one on which the
holders of the preferred securities are entitled to vote, then the property
trustee will deliver notice to us requesting written instructions as to the
course of action to be taken and the property trustee will take or refrain from
taking that action as instructed. If we do not provide these instructions
within ten business days, then the property trustee will take such action as it
deems advisable and in the best interests of the holders of the preferred and
common securities. In this event, the property trustee will have no liability
except for its own bad faith, negligence or willful misconduct.
The Chase Manhattan Bank, which is the property trustee for each trust, also
serves as the senior indenture trustee, the subordinated indenture trustee and
the guarantee trustee under each trust guarantee described below. We and
certain of our affiliates maintain banking relationships with The Chase
Manhattan Bank, which are described above under "DESCRIPTION OF DEBT
SECURITIES--Concerning the Trustee."
Miscellaneous
The administrative trustees of each trust are authorized and directed to
conduct the affairs of and to operate each trust in such a way so that:
. each trust will not be taxable as a corporation or classified as other
than a grantor trust for United States federal income tax purposes;
. the junior subordinated debt securities held by each trust will be
treated as indebtedness of ours for United States federal income tax
purposes; and
. each trust will not be deemed to be an investment company required to be
registered under the Investment Company Act of 1940.
We and the trustees of each trust are authorized to take any action, so long
as it is consistent with applicable law, the certificate of trust or amended
declaration, that we and the trustees determine to be necessary or desirable
for the above purposes.
Registered holders of the preferred securities have no preemptive or similar
rights.
A trust may not incur indebtedness or place a lien on any of its assets.
Governing Law
Each amended declaration and the preferred securities will be governed by
and construed in accordance with the laws of the State of Delaware, without
regard to the conflict of laws provisions thereof.
Description of the Expense Agreement
We will execute an expense agreement at the same time that a trust issues
the preferred securities. Under the expense agreement, we will irrevocably and
unconditionally guarantee to each creditor of each trust the full amount of
that trust's costs, expenses and liabilities, other than the amounts owed to
holders of its preferred and common securities pursuant to the terms of those
securities. Third parties will be entitled to enforce the expense agreement.
The expense agreement, once executed, will be filed with the SEC on Form 8-K or
by a post-effective amendment to the registration statement of which this
prospectus is a part.
Our obligation under an expense agreement will be subordinated in right of
payment to the same extent as the trust guarantees. The expense agreement will
contain provisions regarding amendment, termination, assignment, succession and
governing law similar to those contained in the trust guarantees.
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DESCRIPTION OF TRUST GUARANTEES
The following describes certain general terms and provisions of the trust
guarantees which we will execute and deliver for the benefit of the holders
from time to time of preferred securities. Each trust guarantee will be
qualified as an indenture under the Trust Indenture Act of 1939, and The Chase
Manhattan Bank, an independent trustee, will act as indenture trustee under
each trust guarantee for the purposes of compliance with the provisions of the
Trust Indenture Act of 1939. The terms of each trust guarantee will be those
contained in each trust guarantee and those made part of each trust guarantee
by the Trust Indenture Act of 1939. The following summary may not be complete
and is subject to and qualified in its entirety by reference to the form of
trust guarantee, which is filed as an exhibit to the registration statement
which contains this prospectus, and the Trust Indenture Act of 1939. Each trust
guarantee will be held by the guarantee trustee of each trust for the benefit
of the holders of the preferred securities.
General
We will irrevocably and unconditionally agree to pay the following payments
or distributions with respect to preferred securities, in full, to the holders
of the preferred securities, as and when they become due regardless of any
defense, right of set-off or counterclaim that a trust may have except for the
defense of payment:
(1) any accrued and unpaid distributions which are required to be paid
on the preferred securities, to the extent the trust that issued the
securities does not make such payments or distributions but has sufficient
funds available to do so;
(2) the redemption price and all accrued and unpaid distributions to the
date of redemption with respect to any preferred securities called for
redemption, to the extent the trust that issued the securities does not
make such payments or distributions but has sufficient funds available to
do so; and
(3) upon a voluntary or involuntary dissolution, winding-up or
termination of the trust that issued the securities (other than in
connection with the distribution of junior subordinated debt securities to
the holders of preferred securities or the redemption of all of the
preferred securities), the lesser of
. the total liquidation amount and all accrued and unpaid
distributions on the preferred securities to the date of payment, to
the extent the trust that issued the securities does not make such
payments or distributions but has sufficient funds available to do
so, and
. the amount of assets of the trust that issued the securities
remaining available for distribution to holders of such preferred
securities in liquidation of the trust.
Our obligation to make a payment under a trust guarantee may be satisfied by
our direct payment of the required amounts to the holders of preferred
securities to which the trust guarantee relates or by causing the applicable
trust to pay the amounts to the holders.
Modification of the Trust Guarantee; Assignment
Except with respect to any changes which do not adversely affect the rights
of holders of preferred securities in any material respect (in which case no
vote will be required), each trust guarantee may be amended only with the prior
approval of the holders of not less than a majority in liquidation amount of
the outstanding preferred securities to which the trust guarantee relates. The
manner of obtaining the approval of holders of the preferred securities will be
described in an accompanying prospectus supplement. All guarantees and
agreements contained in each trust guarantee will bind our successors, assigns,
receivers, trustees and representatives and will be for the benefit of the
holders of the outstanding preferred securities to which the trust guarantee
relates.
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Termination
Each trust guarantee will terminate when any of the following has occurred:
(1) all preferred securities to which the trust guarantee relates have
been paid in full or redeemed in full by us, the trust that issued the
securities or both;
(2) the junior subordinated debt securities held by the trust that
issued the securities have been distributed to the holders of the preferred
securities; or
(3) the amounts payable in accordance with the applicable amended
declaration upon liquidation of the trust that issued the securities have
been paid in full.
Each trust guarantee will continue to be effective or will be reinstated, as
the case may be, if at any time any holder of preferred securities to which the
trust guarantee relates must restore payment of any amounts paid on the
preferred securities or under the trust guarantee.
Events of Default
An event of default under a trust guarantee will occur if we fail to perform
any of our payment obligations under a trust guarantee or we fail to perform
any other obligation under a trust guarantee and the failure to perform such
other obligation continues for 60 days.
Each trust guarantee will constitute a guarantee of payment and not of
collection. The holders of a majority in liquidation amount of the preferred
securities to which the trust guarantee relates have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the guarantee trustee in respect of the trust guarantee or to direct the
exercise of any trust or power conferred upon the guarantee trustee under the
trust guarantee. If the guarantee trustee fails to enforce the trust guarantee,
any holder of preferred securities to which the trust guarantee relates may
institute a legal proceeding directly against us to enforce the holder's rights
under the trust guarantee, without first instituting a legal proceeding against
the trust, the guarantee trustee or any one else. If we do not make a guarantee
payment, a holder of preferred securities may directly institute a proceeding
against us for enforcement of the trust guarantee for such payment.
Status of the Trust Guarantees
Each trust guarantee will be our general unsecured obligation and will rank
subordinate and junior in right of payment, and will be subject to our prior
payment in full of our senior debt as described under "DESCRIPTION OF DEBT
SECURITIES -- Subordination."
The terms of the preferred securities provide that each holder of preferred
securities by acceptance of the preferred securities agrees to the
subordination provisions and other terms of the trust guarantee relating to the
subordination. As of June 30, 2000, we had approximately $1.17 billion of
indebtedness that would rank senior to a trust guarantee.
Information Concerning the Guarantee Trustee
The guarantee trustee, prior to the occurrence of a default with respect to
a trust guarantee, undertakes to perform only those duties as are specifically
contained in the trust guarantee and, after default, shall exercise the same
degree of care as a prudent individual would exercise in the conduct of his or
her own affairs. The guarantee trustee is under no obligation to exercise any
of the powers vested in it by the applicable trust guarantee at the request of
any holder of preferred securities to which the trust guarantee relates, unless
it is
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offered indemnity satisfactory to it against the costs, expenses and
liabilities which it might incur by exercising these powers; however the
guarantee trustee will not be, upon the occurrence of an event of default under
the applicable trust guarantee, relieved from exercising the rights and powers
vested in it by such trust guarantee.
Governing Law
The trust guarantees will be governed by and construed in accordance with
the internal laws of the State of New York.
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EFFECT OF OBLIGATIONS UNDER THE SUBORDINATED DEBT SECURITIES
AND THE TRUST GUARANTEES
As long as we may make payments of interest and any other payments when they
are due on the junior subordinated debt securities held by a particular trust,
those payments will be sufficient to cover distributions and any other payments
due on the trust securities issued by that trust because of the following
factors:
(1) the total principal amount of the junior subordinated debt
securities held by the trust will be equal to the total stated liquidation
amount of the trust securities issued by the trust;
(2) the interest rate and the interest payment dates and other payment
dates on the junior subordinated debt securities held by the trust will
match the distribution rate and distribution payment dates and other
payment dates for the preferred securities issued by the trust;
(3) we will pay, and the trust will not be obligated to pay, directly or
indirectly, all costs, expenses, debt, and obligations of the trust (other
than obligations under the trust securities); and
(4) each amended declaration will further provide that the trustees
shall not take or cause or permit the trust to engage in any activity that
is not consistent with the purposes of the trust, which consist solely of
issuing the trust securities, investing in the junior subordinated debt
securities and anything necessary or incident to those activities.
We will guarantee payments of distributions, to the extent the trust
obligated to pay those distributions has funds available to make the payments
due on the preferred securities, to the extent described under "DESCRIPTION OF
TRUST GUARANTEES." If we do not make interest payments on the junior
subordinated debt securities held by a trust, that trust will not have
sufficient funds to pay distributions on the preferred securities. Each trust
guarantee covers the payment of distributions and other payments on the
preferred securities only if and to the extent that we have made a payment of
interest or principal on the junior subordinated debt securities held by the
trust as its sole asset. However, we believe that the trust guarantees, when
taken together with our obligations under the junior subordinated debt
securities and the subordinated indenture and our obligations under the amended
declarations, including our obligations to pay the costs, expenses, debts and
liabilities of the trusts, provide a full and unconditional guarantee of
payment on the preferred securities.
A holder of preferred securities may sue us to enforce its rights under the
trust guarantee which relates to the holder's preferred securities without
first suing the guarantee trustee, the trust or any other person or entity.
PLAN OF DISTRIBUTION
We and the trusts may offer and sell the securities to or through
underwriters or dealers, and also may offer and sell the securities directly to
other purchasers or through designated agents. Any underwriter or agent
involved in the offer and sale of the securities will be named in the
applicable prospectus supplement.
Distribution of the securities may be effected from time to time in one or
more transactions at a fixed price or prices, which may be changed, or at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. We and the trusts also may,
from time to time, authorize underwriters acting as our agents to offer and
sell the securities upon the terms and conditions set forth in any prospectus
supplement.
In connection with the sale of securities, underwriters may receive
compensation from us or a trust or from purchasers of the securities, for whom
they may act as agents, in the form of discounts, concessions or commissions.
Underwriters may sell the securities to or through dealers, and such dealers
may receive compensation in the form of discounts, concessions or commissions
from the underwriters and/or commissions from the purchasers for whom they may
act as agents. Underwriters, dealers and agents that participate in the
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distribution of the securities may be deemed to be underwriters, and any
discounts or commissions they receive from us or a trust, and any profit on the
resale of the securities they realize may be deemed to be underwriting
discounts and commissions under the Securities Act. Any such underwriter,
dealer or agent will be identified, and any such compensation received will be
described, in the applicable prospectus supplement.
Unless otherwise specified in the related prospectus supplement, each series
of the securities will be a new issue with no established trading market, other
than the common stock. Any common stock sold pursuant to a prospectus
supplement will be listed on the NYSE, subject to official notice of issuance.
We and the trusts may elect to list any of the other securities on an exchange,
but are not obligated to do so. It is possible that one or more underwriters
may make a market in a series of the securities, but will not be obligated to
do so and may discontinue any market making at any time without notice.
Therefore, no assurance can be given as to the liquidity of the trading market
for the securities.
If dealers are utilized in the sale of the securities, we and the trusts
will sell the securities to the dealers as principals. The dealers may then
resell the securities to the public at varying prices to be determined by such
dealers at the time of resale. The names of the dealers and the terms of the
transaction will be set forth in the applicable prospectus supplement.
We and the trusts may enter into agreements with underwriters, dealers and
agents who participate in the distribution of the securities which may entitle
these persons to indemnification by us and the trusts against certain
liabilities, including liabilities under the Securities Act, or to contribution
with respect to payments which such underwriters, dealers or agents may be
required to make in respect thereof. Any agreement in which we agree to
indemnify underwriters, dealers and agents against civil liabilities will be
described in the applicable prospectus supplement.
Underwriters, dealers and agents may engage in transactions with, or perform
services for, or be customers of ours in the ordinary course of business.
If so indicated in the applicable prospectus supplement, we will authorize
underwriters or other persons acting as our agents to solicit offers by certain
purchasers to purchase the securities from us at the public offering price
stated in the prospectus supplement pursuant to delayed delivery contracts
providing for payment and delivery on a future date. These contracts will be
subject to only those conditions stated in the prospectus supplement, and the
prospectus supplement will state the commission payable to the solicitor of
such offers.
LEGAL MATTERS
Unless otherwise indicated in the applicable prospectus supplement, the
validity of the securities will be passed upon for us by Alston & Bird LLP,
Washington, D.C., and for the underwriters by Sullivan & Cromwell, New York,
New York. Certain United States federal income taxation matters will be passed
upon for us by Alston & Bird LLP, Washington, D.C. Certain matters of Delaware
law relating to the validity of the preferred securities will be passed upon
for the trust and us by Richards, Layton & Finger, P.A., Wilmington, Delaware.
EXPERTS
The consolidated financial statements of UnumProvident Corporation appearing
in our Annual Report on Form 10-K for the year ended December 31, 1999, have
been audited by Ernst & Young LLP, independent auditors, as set forth in their
report thereon included therein and incorporated herein by reference. Such
consolidated financial statements are incorporated herein by reference in
reliance upon such report given upon the authority of such firm as experts in
accounting and auditing.
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With respect to the unaudited condensed consolidated interim financial
information for the three-month and six-month periods ended March 31 and June
30 of 2000 and 1999, incorporated by reference in this document, Ernst & Young
LLP have reported that they have applied limited procedures in accordance with
professional standards for a review of such information. However, their
separate reports, included in UnumProvident Corporation's quarterly reports on
Form 10-Q for the quarters ended March 31 and June 30, 2000, and incorporated
herein by reference, state that they did not audit and they do not express an
opinion on that interim financial information. Accordingly, the degree of
reliance on their report on such information should be restricted considering
the limited nature of the review procedures applied. The independent auditors
are not subject to the liability provisions of Section 11 of the Securities Act
of 1933 for their reports on the unaudited interim financial information
because those reports are not a "report" or a "part" of the registration
statement prepared or certified by the auditors within the meaning of Section 7
and 11 of the Securities Act.
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PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The expenses in connection with the distribution of the securities are set
forth in the following table. All amounts except the Securities and Exchange
Commission registration fee are estimated.
<TABLE>
<S> <C>
SEC Registration Fee............................................... $264,000
NYSE Listing Fee................................................... 25,000
Blue Sky Fees and Expenses......................................... 5,000
Printing and Engraving Costs....................................... 50,000
Rating Agencies' Fees.............................................. 50,000
Accounting Fees and Expenses....................................... 25,000
Legal Fees and Expenses............................................ 200,000
Trustee and Registrar Fees......................................... 5,000
Miscellaneous...................................................... 10,000
--------
Total............................................................ $634,000
========
</TABLE>
Item 15. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law provides that a
corporation may indemnify directors and officers as well as other employees and
individuals against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement in connection with specified actions, suits or
proceedings, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the corporation--a "derivative action"),
if they acted in good faith and in a manner they reasonably believed to be in
or not opposed to the best interests of the corporation and, with respect to
any criminal action or proceeding, had no reasonable cause to believe their
conduct was unlawful. A similar standard is applicable in the case of
derivative actions, except that indemnification only extends to expenses
(including attorneys' fees) actually and reasonably incurred in connection with
the defense or settlement of such action, and the statute requires court
approval before there can be any indemnification where the person seeking
indemnification has been found liable to the corporation. The statute provides
that it is not exclusive of other rights to which those seeking indemnification
may be entitled under any by-law, agreement, vote of stockholders or
disinterested directors or otherwise.
Article VIII of UnumProvident's Bylaws provides for the indemnification of
UnumProvident's directors and officers as set forth below:
ARTICLE VIII: INDEMNIFICATION
Section 1. Indemnification in Actions, Suits, or Proceedings other than
those by or in the right of the Corporation. Subject to Section 3 of this
Article VIII, the Corporation shall indemnify each person who is or was, or is
threatened to be made, a party to or witness in any threatened, pending or
completed action, suit, proceeding or claim, whether civil, criminal,
administrative or investigative (other than one by or in the right of the
Corporation), by reason of the fact that he is or was a director, officer or
employee of the Corporation or of Union Mutual Life Insurance Company, a Maine
mutual insurance company (the "Mutual Company"), or is or was serving at the
request of the Corporation or the Mutual Company as a director, officer,
employee or trustee of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, against expenses (including
attorney's fees and expenses), judgments, fines, penalties, and amounts paid in
settlement,
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incurred by him in connection with defending, investigating, preparing to
defend, or being or preparing to be a witness in, such action, suit, proceeding
or claim, if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Corporation, and, with
respect to any criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful.
Section 2. Indemnification in Actions, Suits or Proceedings by or in the
Right of the Corporation. Subject to Section 3 of this Article VIII, the
Corporation shall indemnify each person who is or was, or is threatened to be
made, a party to or witness in any threatened, pending or completed action,
suit, proceeding or claim by or in the right of the Corporation to procure a
judgment in its favor by reason of the fact that he is or was a director,
officer or employee of the Corporation or of the Mutual Company or is or was
serving at the request of the Corporation or the Mutual Company as a director,
officer, employee or trustee of another corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise, against expenses
(including attorney's fees and expenses), and, if and to the extent permitted
by applicable law, judgments, penalties and amounts paid in settlement,
incurred by him in connection with defending, investigating, preparing to
defend, or being or preparing to be a witness in, such action, suit, proceeding
or claim, if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Corporation; provided,
however, that no indemnification shall be made in respect of any such claim or
any issue or matter in any such action, suit or proceeding as to which such
person shall have been adjudged to be liable to the Corporation unless (and
only to the extent that) the Court of Chancery or the court in which such
claim, action, suit or proceeding was brought shall determine upon application
that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnification for such expenses and amounts which the Court of Chancery or
such other court shall deem proper.
Section 3. Authorization of Indemnification.
(a) Any indemnification under this Article VIII (unless ordered by a court)
shall be made by the Corporation only as authorized in the specific case upon a
determination that indemnification of the person seeking indemnification is
proper in the circumstances because he has met the applicable standard of
conduct set forth in Section 1 or 2 of this Article VIII, as the case may be.
Such determination (and determinations under Sections 5 and 6 of this Article
VIII) shall be made (i) by the Board of Directors by a majority vote of a
quorum consisting of directors who were not parties to the action, suit,
proceeding or claim with respect to which indemnification is sought
("disinterested directors"), or (ii) if such a quorum is not obtainable, or if
a quorum of disinterested directors so directs, in a written opinion of
independent legal counsel chosen by the Board of Directors, or (iii) by the
stockholders; provided, however, that if a Change in Control (as defined in
this Section 3) has occurred and the person seeking indemnification so
requests, such determination (and determination under Sections 5 and 6 of this
Article VIII) shall be made in a written opinion rendered by independent legal
counsel chosen by the person seeking indemnification and not reasonably
objected to by the Board of Directors (whose fees and expenses shall be paid by
the Corporation). To the extent, however, that a director, officer, employee or
trustee or former director, officer, employee or trustee has been successful on
the merits or otherwise in defense of any action, suit, proceeding or claim
described above, or in defense of any claim, issue or matter therein, he shall
be indemnified against expenses (including attorney's fees and expenses)
incurred by him in connection therewith, without the necessity of authorization
in the specific case.
(b) For purposes of the proviso to the second sentence of Section 3(a),
"independent legal counsel" shall mean legal counsel other than an attorney, or
a firm having associated with it an attorney, who has been retained by or who
has performed services for the Corporation, the Mutual Company or the person
seeking indemnification within the previous three years.
(c) A "Change in Control" shall mean a change in control of the Corporation
of a nature that would be required to be reported in response to Item 5(f) of
Schedule 14A of Regulation 14A promulgated under the Act, whether or not the
Corporation is then subject to such reporting requirement; provided that,
without limitation, such a change in control shall be deemed to have occurred
if (i) any "person" (as such term is used in sections
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13(d) and 14(d) of the Act) is or becomes the "beneficial owner" (as defined in
Rule 13d-3 under the Act), directly or indirectly, of securities of the
Corporation representing 35% or more of the combined voting power of the
Corporation's then outstanding securities without the prior approval of at
least two-thirds of the members of the Board of Directors in office immediately
prior to such acquisition, or (ii) the Corporation is a party to a merger,
consolidation, sale of assets or other reorganization, or proxy contest, as a
consequence of which members of the Board of Directors in office immediately
prior to such transaction or event constitute less than a majority of the Board
of Directors thereafter, or (iii) during any period of two consecutive years,
individuals who at the beginning of such period constituted the Board of
Directors (including for this purpose any new director whose election or
nomination for election by the Corporation's stockholders was approved by a
vote of at least two-thirds of the directors then still in office who were
directors at the beginning of the period) cease for any reason to constitute at
least a majority of the Board of Directors.
Section 4. Good Faith Defined, Etc.
(a) For purposes of any determination under Section 3 of this Article VIII,
a person shall be deemed to have acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Corporation, or, with respect to any criminal action or proceeding, to have had
no reasonable cause to believe his conduct was unlawful, if such person relied
on the records or books of account of the Corporation, the Mutual Company or
another enterprise, or on information supplied to him by the officers of the
Corporation, the Mutual Company or another enterprise, or on information or
records given or reports made to the Corporation, the Mutual Company or another
enterprise by an independent certified public accountant or by an appraiser or
other expert selected with reasonable care by the Corporation, the Mutual
Company or another enterprise. The term "another enterprise" as used in this
Section 4(a) shall mean any other corporation or any partnership, joint
venture, trust, employee benefit plan or other enterprise of which such person
is or was serving at the request of the Corporation or the Mutual Company as a
director, officer, employee or trustee.
(b) The termination of any action, suit, proceeding or claim by judgment,
order, settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the person did not
act in good faith and in a manner which he reasonably believed to be in or not
opposed to the best interests of the Corporation, or, with respect to any
criminal action or proceeding, that he had no reasonable cause to believe that
his conduct was unlawful.
(c) References in this Article VIII to "penalties" include any excise taxes
assessed on a person with respect to an employee benefit plan; references in
this Article VIII to "serving at the request of the Corporation or the Mutual
Company" include any service as a director, officer or employee or former
director, officer or employee of the Corporation or the Mutual Company which
imposes duties on, or involves services by, such person with respect to an
employee benefit plan or its participants or beneficiaries; and a person who
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the participants or beneficiaries of such an
employee benefit plan shall be deemed to have acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
the Corporation.
(d) The provisions of this Section 4 shall not be deemed to be exclusive or
to limit in any way the circumstances in which a person may be deemed to have
met the applicable standard of conduct set forth in Section 1 or 2 of this
Article VIII, as the case may be.
Section 5. Right to Indemnification Upon Application; Procedure Upon
Application; Etc. Except as otherwise provided in the proviso to Section 2 of
this Article VIII:
(a) Any indemnification under Section 1 or 2 of this Article VIII shall be
made no later than 45 days after receipt by the Corporation of the written
request of the director, officer, employee or trustee or former director,
officer, employee or trustee unless a determination is made within said 45-day
period in accordance with Section 3 of this Article VIII that such person has
not met the applicable standard of conduct set forth in Section 1 or 2 of this
Article VIII.
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(b) The right to indemnification under Section 1 or 2 of this Article VIII
or advances under Section 6 of this Article VIII shall be enforceable by the
director, officer, employee or trustee or former director, officer, employee or
trustee in any court of competent jurisdiction. Following a Change in Control,
the burden of proving that indemnification is not appropriate shall be on the
Corporation. Neither the absence of any prior determination that
indemnification is proper in the circumstances, nor a prior determination that
indemnification is not proper in the circumstances, shall be a defense to the
action or create a presumption that the director, officer, employee or trustee
or former director, officer, employee or trustee has not met the applicable
standard of conduct. The expenses (including attorney's fees and expenses)
incurred by the director, officer, employee or trustee or former director,
officer, employee or trustee in connection with successfully establishing his
right to indemnification, in whole or in part, in any such action (or in any
action or claim brought by him to recover under any insurance policy or
policies referred to in Section 9 of this Article VIII) shall also be
indemnified by the Corporation.
(c) If any person is entitled under any provision of this Article VIII to
indemnification by the Corporation for some or a portion of expenses,
judgments, fines, penalties or amounts paid in settlement incurred by him, but
not, however, for the total amount thereof, the Corporation shall nevertheless
indemnify such person for the portion of such expenses, judgments, fines,
penalties and amounts to which he is entitled.
Section 6. Expenses Payable in Advance. Expenses (including attorney's fees
and expenses) incurred by a director, officer, employee or trustee or a former
director, officer, employee or trustee in defending, investigating, preparing
to defend, or being or preparing to be a witness in, a threatened or pending
action, suit, proceeding or claim against him, whether civil or criminal, may
be paid by the Corporation in advance of the final disposition of such action,
suit, proceeding or claim upon receipt by the Corporation of a written request
therefor and a written undertaking by or on behalf of the director, officer,
employee or trustee or former director, officer, employee or trustee to repay
such amounts if it shall be determined in accordance with Section 3 of this
Article VIII that he is not entitled to be indemnified by the Corporation;
provided, however, that if he seeks to enforce his rights in a court of
competent jurisdiction pursuant to Section 5(b) of this Article VIII, said
undertaking to repay shall not be applicable or enforceable unless and until
there is a final court determination that he is not entitled to indemnification
as to which all rights of approval have been exhausted or have expired.
Section 7. Certain Persons Not Entitled to Indemnification. Notwithstanding
any other provision of this Article VIII, no person shall be entitled to
indemnification under this Article VIII or to advances under Section 6 of this
Article VIII with respect to any action, suit, proceeding or claim brought or
made by him against the Corporation or the Mutual Company, other than an
action, suit, proceeding or claim seeking, or defending such person's right to,
indemnification and/or expense advances pursuant to this Article VIII or
otherwise.
Section 8. Non-Exclusivity and Survival of Indemnification. The provisions
of this Article VIII shall not be deemed exclusive of any other rights to which
the person seeking indemnification or expense advances may be entitled under
any agreement, contract, or vote of stockholders or disinterested directors, or
pursuant to the direction (howsoever embodied) of any court of competent
jurisdiction, or otherwise, both as to action in his official capacity and as
to action in another capacity while holding such office. Except as otherwise
provided in Section 7 of this Article VIII, but notwithstanding any other
provision of this Article VIII, it is the policy of the Corporation that
indemnification of and expense advances to the persons specified in Sections 1
and 2 of this Article VIII shall be made to the fullest extent permitted by
law, and, accordingly, in the event of any change in law, by legislation or
otherwise, permitting greater indemnification of and/or expense advances to any
such person, the provisions of this Article VIII shall be construed so as to
require such greater indemnification and/or expense advances. The provisions of
this Article VIII shall not be deemed to preclude the indemnification of any
person who is not specified in Section 1 or 2 of this Article VIII but whom the
Corporation has the power to indemnify under the provisions of the General
Corporation Law of the State of Delaware or otherwise. The provisions of this
Article VIII shall continue as to a person who has ceased to be a director,
officer, employee or trustee and shall inure to the benefit of the heirs,
executors and administrators of such person.
II-4
<PAGE>
Section 9. Insurance. The Corporation may purchase and maintain at its
expense insurance on behalf of any person who is or was a director, officer or
employee of the Corporation or the Mutual Company or is or was serving at the
request of the Corporation or the Mutual Company as a director, officer,
employee or trustee of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise against any liability or expense
asserted against or incurred by him in any such capacity, or arising out of his
status as such, whether or not the Corporation would have the power or the
obligation to indemnify him against such liability or expense under the
provisions of this Article VIII or the provisions of Section 145 of the General
Corporation Law of the State of Delaware. The Company shall not be obligated
under this Article VIII to make any payment in connection with any claim made
against any person if and to the extent that such person has actually received
payment therefor under any insurance policy or policies.
Section 10. Successors; Meaning of "Corporation." This Article VIII shall be
binding upon and enforceable against any direct or indirect successor by
purchase, merger, consolidation or otherwise to all or substantially all of the
business and/or assets of the Corporation. For purposes of this Article VIII,
but subject to the provisions of any agreement relating to any merger or
consolidation of the kind referred to in clause (i) below or of any agreement
relating to the acquisition of any corporation of the kind referred to in
clause (ii) below, references to "the Corporation" shall include (i) any
constituent corporation (including any constituent of a constituent) absorbed
in a consolidation or merger with the Corporation which, if its separate
existence had continued, would have had power and authority to indemnify its
directors, officers and employees, so that any person who is or was a director,
officer or employee of such constituent corporation, or is or was serving at
the request of such constituent corporation as a director, officer, employee or
trustee of another corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise, shall stand in the same position under the
provisions of this Article VIII with respect to the Corporation as he would
have with respect to such constituent corporation if its separate existence had
continued; and (ii) any corporation of which at least a majority of the voting
power (as represented by its outstanding stock having voting power generally in
the election of directors) is owned directly or indirectly by the Corporation.
Section 11. Severability. The provisions of this Article VIII shall be
severable in the event that any provision hereof (including any provision
within a single section, subsection, clause, paragraph or sentence) is held
invalid, void or otherwise unenforceable on any ground by any court of
competent jurisdiction. In the event of any such holding, the remaining
provisions of this Article VIII shall continue in effect and be enforceable to
the fullest extent permitted by law.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933, as amended may be permitted to directors, officers or persons
controlling the Registrant pursuant to the foregoing provisions, the Registrant
has been informed that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is
therefore unenforceable.
UnumProvident also maintains insurance on its directors and officers, which
covers liabilities under federal securities laws.
UnumProvident Corporation, as depositor, has agreed in each Declaration of
Trust to (i) reimburse the Trustees of each trust for all reasonable expenses
(including reasonable fees and expenses of counsel and other experts) and (ii)
indemnify, defend and hold harmless the Trustees and any of the officers,
directors, employees and agents of the Trustees (the "Indemnified Persons")
from and against any and all losses, damages, liabilities, claims, actions,
suits, costs, expenses, disbursements (including the reasonable fees and
expenses of counsel), taxes and penalties of any kind and nature whatsoever
(collectively, "Expenses"), to the extent that such Expenses arise out of, or
are imposed upon, or asserted at any time against, such Indemnified Persons
with respect to the performance of the Declaration of Trust, the creation,
operation or termination of a trust or the transactions contemplated thereby;
provided, however, that UnumProvident Corporation shall not be required to
indemnify any Indemnified Person for any Expenses which are a result of the
willful misconduct, bad faith or gross negligence of such Indemnified Person.
II-5
<PAGE>
Item 16. Exhibits
<TABLE>
<C> <S>
1.1 Form of Underwriting Agreement for senior debt securities.*
1.2 Form of Underwriting Agreement for subordinated debt securities.*
1.3 Form of Underwriting Agreement for preferred stock.*
1.4 Form of Underwriting Agreement for common stock.*
1.5 Form of Underwriting Agreement for stock purchase contracts.*
1.6 Form of Underwriting Agreement for stock purchase units.*
1.7 Form of Underwriting Agreement for warrants.*
1.8 Form of Underwriting Agreement for preferred securities.*
3.1 Restated Certificate of Incorporation (incorporated by reference to
Exhibit 2 to our Registration Statement on Form 8-A/A (File No. 1-11834)
filed on June 30, 1999).
3.2 By-Laws (incorporated by reference to Exhibit 3.2 to our Annual Report
on Form 10-K (File No. 1-11834) for the year ended December 31, 1999).
4.1 Form of Indenture for senior debt securities.**
4.2 Form of Indenture for subordinated debt securities.**
4.3 Form of preferred stock designations.*
4.4 Form of Depositary Agreement.*
4.5 Form of Depositary Receipt.*
4.6 Form of Senior Debt Security.*
4.7 Form of Subordinated Debt Security.*
4.8 Form of Preferred Security. (included in Exhibit 4.16).
4.9 Form of Warrant Agreement.*
4.10 Form of Purchase Contract Agreement (including the form of the Security
Certificate).*
4.11 Form of Pledge Agreement.*
4.12 Certificate of Trust of UnumProvident Financing Trust II.**
4.13 Certificate of Trust for UnumProvident Financing Trust III.**
4.14 Declaration of Trust of UnumProvident Financing Trust II.**
4.15 Declaration of Trust of UnumProvident Financing Trust III.**
4.16 Form of amended and restated declaration of trust for each of
UnumProvident Financing** Trust II and UnumProvident Financing Trust III
(Form of Preferred Security included therein).
4.17 Form of Preferred Securities Guarantee.**
4.18 Form of Expense Agreement (included in Exhibit 4.16).
5.1 Opinion of Alston & Bird LLP regarding legality of the securities.
5.2 Opinion of Richards, Layton & Finger, P.A. regarding legality of the
Preferred Securities of UnumProvident Financing Trust II.
5.3 Opinion of Richards Layton & Finger, P.A. regarding legality of the
Preferred Securities of UnumProvident Financing Trust III.
8.1 Opinion of Alston & Bird LLP regarding certain tax consequences.*
12.1 Statement regarding computation of ratios of earnings to fixed
charges.**
12.2 Statement regarding computation of ratios of earnings to combined fixed
charges and preferred stock dividends.**
</TABLE>
II-6
<PAGE>
<TABLE>
<C> <S>
15.1 Letter of Ernst & Young LLP regarding unaudited information.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Alston & Bird LLP (included in Exhibit 5.1).
23.3 Consent of Alston & Bird LLP (included in Exhibit 8.1).*
23.4 Consent of Richards, Layton & Finger, P.A. (included in Exhibits 5.2 and
5.3).
24.1 Powers of Attorney (included on signature page of Registration
Statement).**
25.1 Statement of Eligibility and Qualification of Trustee on Form T-1 under
the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank
as Trustee for the Senior Indenture for the Senior Debt Securities.**
25.2 Statement of Eligibility and Qualification of Trustee on Form T-1 under
the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank
as Trustee under the Subordinated Indenture for the Subordinated Debt
Securities.**
25.3 Statement of Eligibility and Qualification of Trustee on Form T-1 under
the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank
as Property Trustee for the Amended and Restated Declaration of Trust of
UnumProvident Financing Trust II.**
25.4 Statement of Eligibility and Qualification of Trustee on Form T-1 under
the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank
as Property Trustee for the Amended and Restated Declaration of Trust of
UnumProvident Financing Trust III.**
25.5 Statement of Eligibility and Qualification of Trustee on Form T-1 under
the Trust Indenture Act of 1939, as amended, of The Chase Manhattan
Bank, as Guarantee Trustee under the Preferred Securities Guarantee for
the benefit of the holders of the Preferred Securities of UnumProvident
Financing Trust II.**
25.6 Statement of Eligibility and Qualification of Trustee on Form T-1 under
the Trust Indenture Act of 1939, as amended, of The Chase Manhattan
Bank, as Guarantee Trustee under the Preferred Securities Guarantee for
the benefit of the holders of the Preferred Securities of UnumProvident
Financing Trust III.**
</TABLE>
--------
* To be filed by amendment or as an exhibit to a document to be incorporated
by reference herein in connection with an offering of the offered
securities.
** Previously filed.
Item 17. Undertakings
(a) The undersigned Registrants hereby undertake:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement. Notwithstanding the foregoing, any
increase or decrease in the volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent change
in the maximum aggregate offering price set forth in the "Calculation
of Registration Fee" table in the effective Registration Statement;
II-7
<PAGE>
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrants hereby undertake that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrants pursuant to the foregoing provisions, or otherwise, the
Registrants have been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act of 1933 and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by a Registrant of expenses incurred or paid by a director, officer or
controlling person of a Registrant in the successful defense of any action,
suit or proceeding) is asserted against a Registrant by such director, officer
or controlling person in connection with the securities being registered, a
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
(d) The undersigned Registrants hereby undertake to file an application for
the purpose of determining the eligibility of the Trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act in accordance with the
rules and regulations prescribed by the Securities and Exchange Commission
under Section 305(b)(2) of the Act, if necessary.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, each Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Amendment to the
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Chattanooga, State of Tennessee, on August 29,
2000.
UNUMPROVIDENT CORPORATION
/s/ F. Dean Copeland
By: _________________________________
F. Dean Copeland
Executive Vice President and
General Counsel
UNUMPROVIDENT FINANCING TRUST II
By: UnumProvident Corporation, as
depositor
/s/ F. Dean Copeland
_____________________________________
F. Dean Copeland
Executive Vice President and
General Counsel
UNUMPROVIDENT FINANCING TRUST III
By: UnumProvident Corporation, as
depositor
/s/ F. Dean Copeland
_____________________________________
F. Dean Copeland
Executive Vice President and
General Counsel
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to the Registration Statement has been signed by the following persons in the
capacities indicated as of August 29, 2000.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
* Chairman, President and August 29, 2000
______________________________________ Chief Executive Officer
J. Harold Chandler
* Executive Vice President, August 29, 2000
______________________________________ Finance and Risk
Thomas R. Watjen Management (principal
financial officer)
</TABLE>
II-9
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
* Senior Vice President-- August 29, 2000
______________________________________ Finance (principal
Robert C. Greving accounting officer)
* Director August 29, 2000
______________________________________
William L. Armstrong
Director August 29, 2000
______________________________________
Ronald E. Goldsberry
* Director August 29, 2000
______________________________________
Hugh O. Maclellan, Jr.
Director August 29, 2000
______________________________________
A.S. (Pat) MacMillan
Director August 29, 2000
______________________________________
George J. Mitchell
* Director August 29, 2000
______________________________________
Cynthia A. Montgomery
* Director August 29, 2000
______________________________________
James L. Moody, Jr.
Director August 29, 2000
______________________________________
C. William Pollard
* Director August 29, 2000
______________________________________
Lawrence R. Pugh
* Director August 29, 2000
______________________________________
Lois Dickson Rice
Director August 29, 2000
______________________________________
John W. Rowe
* Director August 29, 2000
______________________________________
Burton E. Sorensen
</TABLE>
/s/ Susan N. Roth
*By: _______________________
Susan N. Roth
as Attorney-in-Fact
II-10
