As filed with the Securities and Exchange Commission on February 6, 1998
Registration Statement No. -
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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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NEW YORK TELEPHONE COMPANY
(Exact Name of Registrant as Specified in Its Charter)
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New York 13-5275510
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
1095 Avenue of the Americas Ellen C. Wolf
New York, New York 10036 Treasurer
(212) 395-2121 New York Telephone Company
(Address, including zip code, and 1095 Avenue of the Americas
telephone number, including New York, New York 10036
area code, of Registrant's (212) 395-1056
principal executive offices) (Name, address, including zip code, and
telephone number, including area code,
of agent for service)
Copies to:
P. Alan Bulliner Raymond W. Wagner
Associate General Counsel and Simpson Thacher & Bartlett
Corporate Secretary 425 Lexington Avenue
Bell Atlantic Corporation New York, New York 10017
1095 Avenue of the Americas
New York, New York 10036
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Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement, as determined
by market conditions.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_] ___________________
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_] ____________________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
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CALCULATION OF REGISTRATION FEE
- --------------------------------------------------------------------------------
Proposed Proposed
Maximum Maximum
Title of Each Class Aggregate Aggregate Amount of
of Securities Amount to be Price Offering Registration
to be Registered Registered(1) Per Unit(2) Price(2) Fee
- ---------------------- ------------- ----------- ------------ ------------
Debt Securities ...... $750,000,000 100% $750,000,000 $221,250
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(1) Or, if any Debt Securities are issued at an original issue discount, such
greater amount as shall result in aggregate gross proceeds of $750,000,000
to the Registrant.
(2) Estimated solely for calculating the registration fee.
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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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SUBJECT TO COMPLETION, DATED FEBRUARY 6, 1998
PROSPECTUS
$750,000,000
New York Telephone Company
d/b/a/ Bell Atlantic -- New York
Debt Securities
New York Telephone Company ("Company") may offer from time to time in one
or more series up to $750,000,000 aggregate principal amount of its debt
securities ("Securities"), on terms to be determined at the time Securities are
offered for sale. Securities may be offered for sale directly to purchasers and
may also be offered through underwriters, dealers or agents.
The terms of the Securities, including, where applicable, the specific
designation, aggregate principal amount, authorized denominations, maturity,
interest rate (or manner of calculation thereof) and time of payment of
interest, if any, any redemption terms, the initial public offering price, the
net proceeds to the Company from the sale of the Securities, the names of any
underwriters or agents, any compensation to such underwriters or agents and any
other specific terms in connection with the offering and sale of the Securities
in respect of which this Prospectus is being delivered are set forth in the
accompanying Prospectus Supplement ("Prospectus Supplement").
The Securities may be issued in registered form or bearer form. In
addition, all or a portion of the Securities of a series may be issued in global
form. Subject to certain exceptions, Securities in bearer form will not be
offered, sold or delivered to persons within the United States or to United
States persons. See "Limitations on Issuance of Bearer Securities."
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
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February __, 1998
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
<PAGE>
No person has been authorized to give any information or to make any
representation not contained or incorporated by reference in this Prospectus or
in the Prospectus Supplement in connection with the offer made by this
Prospectus or the Prospectus Supplement and, if given or made, such information
or representation must not be relied upon as having been authorized by the
Company or by any underwriter, dealer or agent. This Prospectus and the
Prospectus Supplement do not constitute an offer to sell or a solicitation of an
offer to buy any of the Securities offered hereby in any jurisdiction to any
person to whom it is unlawful to make such offer or solicitation in such
jurisdiction. This Prospectus and the Prospectus Supplement do not constitute an
offer to sell or a solicitation of an offer to buy any Securities other than
those to which they relate. The delivery of this Prospectus or the Prospectus
Supplement at any time does not imply that the information herein or therein is
correct as of any time subsequent to its date.
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended ("Exchange Act"), and in accordance therewith
files reports and other information with the Securities and Exchange Commission
("SEC"). Such reports and other information filed by the Company can be
inspected and copied at the public reference facilities of the SEC, Room 1024,
Judiciary Plaza, 450 Fifth Street, N.W., Washington, DC 20549, as well as at the
following SEC Regional Offices: Seven World Trade Center, New York, NY 10048;
and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, IL 60661.
Copies can be obtained from the SEC by mail at prescribed rates. Requests should
be directed to the SEC's Public Reference Section, Room 1024, Judiciary Plaza,
450 Fifth Street, N.W., Washington, DC 20549. The SEC also maintains a Web site
(http://www.sec.gov) that contains reports and other information regarding the
Company.
The Company has filed with the SEC Registration Statements on Form S-3
(together with all amendments and exhibits thereto, the "Registration
Statements") under the Securities Act of 1933, as amended ("Securities Act"),
covering the Securities offered hereby. This Prospectus does not contain all of
the information set forth in the Registration Statements, certain parts of which
are omitted from the Prospectus in accordance with the rules and regulations of
the SEC. For further information, reference is made to the Registration
Statements.
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INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents have been filed by the Company with the SEC (File
No. 1-3435) and are hereby incorporated herein by reference:
(1) The Company's Annual Report on Form 10-K for the year ended
December 31, 1996;
(2) The Company's Quarterly Report on Form 10-Q for the quarters
ended March 31, June 30 and September 30, 1997; and
(3) The Company's Current Reports on Form 8-K, date of reports
August 14, 1997, January 12, 1998 and January 20, 1998.
All documents filed pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of this Prospectus and prior to the
termination of the offering shall be deemed to be incorporated by reference in
this Prospectus and to be part hereof from the date of filing of such documents.
Any statement contained in a document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
Copies of the above documents (excluding exhibits to such documents,
unless such exhibits are specifically incorporated by reference therein) may be
obtained upon written or oral request without charge by each person to whom this
Prospectus is delivered from the Director-External Reporting, Bell Atlantic
Corporation, 31st Floor, 1717 Arch Street, Philadelphia, PA 19103 (telephone
number: 215-963-6360).
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THE COMPANY
The Company is engaged in the business of providing
telecommunications services in New York State and in a small portion
of Connecticut (Greenwich and Byram only). Since January 1, 1984, the
Company has been a wholly owned subsidiary of NYNEX Corporation
("NYNEX"), one of the seven regional holding companies formed by
American Telephone and Telegraph Company ("AT&T") in connection with
the court-ordered divestiture by AT&T of certain portions of its 22
wholly owned operating telephone companies. Prior to its divestiture
by AT&T on January 1, 1984, the Company was an associated company of
the Bell System and a wholly owned subsidiary of AT&T.
As a result of the merger of NYNEX and Bell Atlantic Corporation
("Bell Atlantic") on August 14, 1997, the Company became an indirect
wholly owned subsidiary of Bell Atlantic. Bell Atlantic, another of
the original seven holding companies formed by AT&T in connection with
the divestiture, is a diversified telecommunications company operating
in the region stretching from Maine to Virginia. In addition to its
operating telephone subsidiaries, Bell Atlantic provides domestic
wireless service in 25 states and has international wireless and other
telecommunications company investments.
The Company, incorporated in 1896 under the laws of the State of
New York, has its principal executive offices at 1095 Avenue of the
Americas, New York, NY 10036 (telephone number 212 395-2121).
USE OF PROCEEDS
The Company intends to apply the proceeds from the sale of the Securities
to repay short-term and/or long-term debt and to refinance outstanding long-term
debt. If market conditions are such that the Company determines it is in its
best interests to refinance long-term debt, the Company would consider
redeeming, repurchasing or refinancing, in whole or in part, one or more
outstanding issues identified in the Prospectus Supplement relating to the
particular series of Securities being offered hereby.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the historical ratios of earnings to fixed
charges of the Company for the periods indicated:
Nine Months Years Ended December 31,
Ended ----------------------------------------------
September 30,
1997 1996* 1995* 1994* 1993* 1992*
-------------- ------- ------- ------- ------- ------
2.44 4.48 3.27 2.48 1.31 3.97
For the purpose of this ratio: (i) earnings have been calculated by adding
interest expense and the estimated interest portion of rentals to income before
the provision for income taxes, extraordinary item and cumulative effect of
change in accounting principle; and (ii) fixed charges are comprised of interest
expense, the estimated interest portion of rentals and interest capitalized on
construction.
*Revised to reflect certain reclassifications in presentation and certain
retroactive adjustments to conform the accounting methodologies of Bell Atlantic
and NYNEX as a result of their merger.
DESCRIPTION OF SECURITIES
The following describes certain general terms and provisions of the
Securities to which any Prospectus Supplement may relate. The particular terms
and provisions of the series of Securities offered by a Prospectus Supplement,
and the extent to which such general terms and provisions described below may
apply thereto, will be described in the Prospectus Supplement relating to such
series of Securities.
The Securities are to be issued under an Indenture dated as of February 1,
1998 ("Indenture"), from the Company to The Chase Manhattan Bank, Trustee
("Trustee"). The following summaries of certain provisions of the Securities and
the Indenture do not purport to be complete and are subject to, and are
qualified in their entirety by reference to, all provisions of the Indenture,
including the definitions therein of certain terms. Wherever particular sections
or defined terms of the Indenture are referred to, it is intended that such
sections or defined terms shall be incorporated herein by reference.
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General
The Indenture does not limit the amount of Securities which can be issued
thereunder, and additional debt securities may be issued thereunder up to the
aggregate principal amount which may be authorized from time to time by, or
pursuant to a resolution of, the Company's Board of Directors or by a
supplemental indenture. Reference is made to the Prospectus Supplement for the
following terms of the particular series of Securities being offered hereby: (i)
the title of the Securities of the series; (ii) any limit upon the aggregate
principal amount of the Securities of the series; (iii) the date or dates (or
manner of determining the same) on which the principal of the Securities of the
series will mature; (iv) the rate or rates (or manner of calculation thereof),
if any, at which the Securities of the series will bear interest, the date or
dates from which any such interest will accrue and on which such interest will
be payable (or manner of determining the same), and, with respect to Securities
of the series in registered form, the record date for the interest payable on
any interest payment date; (v) the place or places where the principal of and
interest, if any, on the Securities of the series will be payable; (vi) any
redemption or sinking fund provisions; (vii) if other than the principal amount
thereof, the portion of the principal amount of Securities of the series which
will be payable upon declaration of acceleration of the maturity thereof; (viii)
whether the Securities of the series will be issuable in registered form
("registered Securities") or bearer form ("bearer Securities") or both, and
whether and the terms upon which bearer Securities will be exchangeable for
registered Securities and vice versa; (ix) any provisions for payment of
additional amounts for taxes and any provision for redemption, in the event the
Company must comply with reporting requirements in respect of a Security or must
pay such additional amounts in respect of any Security; (x) whether the
Securities of the series will be issued in whole or in part in the form of a
temporary or permanent global Security or Securities and, in such case, the
depositary therefor; (xi) any other terms of the Securities (which terms shall
not be inconsistent with the provisions of the Indenture), including any terms
which may be required by or advisable under United States laws or regulations or
advisable in connection with the marketing of Securities of such series.
(Sections 2.01. and 2.02.) To the extent not described herein, principal,
premium, if any, and interest, if any, will be payable, and the Securities of a
particular series will be transferable, in the manner described in the
Prospectus Supplement relating to such series.
Each series of Securities will constitute unsecured indebtedness of the
Company and will rank on a parity with the Company's other unsecured
indebtedness.
Securities may be sold at a substantial discount below their stated
principal amount, bearing no interest or interest at a rate which at the time of
issuance is below market rates. Federal income tax consequences applicable to
any such Securities will be described in the Prospectus Supplement relating
thereto.
Denominations, Registration of Transfer and Exchange
Unless otherwise indicated in the Prospectus Supplement, the Securities
will be issuable in denominations of $1,000 and integral multiples thereof.
Securities of a series may be issuable in whole or in part in the form of one or
more global Securities, as described below under "Global Securities". One or
more global Securities will be issued in a denomination or aggregate
denominations equal to the aggregate principal amount of Securities of the
series to be represented by such global Security or Securities. If so provided
with respect to a series of Securities, Securities of such series will be
issuable solely as bearer Securities with coupons attached or as both registered
Securities and bearer Securities.
In connection with the sale during the "restricted period" as defined in
Section 1.163-5(c)(2)(i)(D)(7) of the United States Treasury Regulations
(generally, the first 40 days after the closing date and, with respect to unsold
allotments, until sold), no bearer Security shall be mailed or otherwise
delivered to any location in the United States (as defined under "Limitations on
Issuance of Bearer Securities"). A bearer Security in definitive form (including
interests in a permanent global Security) may be delivered only if the person
entitled to receive such bearer Security furnishes written certification, in the
form required by the Indenture, to the effect that such bearer Security is not
owned by or on behalf of a United States person (as defined under "Limitations
on Issuance of Bearer Securities"), or, if a beneficial interest in such bearer
Security is owned by or on behalf of a United States person, that such United
States person (i) acquired and holds the bearer Security through a foreign
branch of a United States financial institution, (ii) is a foreign branch of a
United States financial institution purchasing for its own account or resale
(and in either case, (i) or (ii), such financial institution agrees to comply
with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal
Revenue Code of 1986, as amended ("Code"), and the regulations thereunder)
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or (iii) is a financial institution purchasing for resale during the restricted
period which certifies that it has not acquired such bearer Security for
purposes of resale to a United States person or to a person within the United
States. (Section 2.03.(d)) See "Global Securities--Bearer Debt Securities" and
"Limitations on Issuance of Bearer Securities". Bearer Securities and the
coupons related thereto will be transferable by delivery. (Section 2.12.(e))
Registered Securities of any series (other than a global Security) may be
exchanged for other registered Securities of that series, of any authorized
denominations and in a like aggregate principal amount having identical terms.
In addition, if Securities of any series are issuable as both registered
Securities and as bearer Securities, at the option of the holder, and subject to
the terms of the Indenture, bearer Securities (with all unmatured coupons,
except as provided below, and all matured coupons in default) of such series may
be exchanged for registered Securities of that series of any authorized
denominations and of a like aggregate principal amount having identical terms.
Unless otherwise indicated in an applicable Prospectus Supplement, any bearer
Security surrendered in exchange for a registered Security between a regular
record date or a special record date and the relevant date for payment of
interest shall be surrendered without the coupon relating to such date for
payment of interest and interest will not be payable in respect of the
registered Security issued in exchange for such bearer Security but will be
payable only to the holder of such coupon when due in accordance with the terms
of the Indenture. (Section 2.12.(b)) Except as provided in an applicable
Prospectus Supplement, bearer Securities will not be issued in exchange for
registered Securities.
Securities may be presented for exchange as provided above, and registered
Securities (other than a global Security) may be presented for registration of
transfer (with the form of transfer endorsed thereon duly executed), at the
office of the registrar or at the office of any co-registrar appointed by the
Company for such purpose with respect to any series of Securities and referred
to in an applicable Prospectus Supplement, without service charge and upon
payment of any taxes and other governmental charges as described in the
Indenture. (Sections 2.04. and 2.12.(c)) Such transfer or exchange will be
effected upon the registrar or co-registrar, as the case may be, being satisfied
with the documents of title and identity of the person making the request. The
Company has initially appointed the Trustee as registrar under the Indenture. If
a Prospectus Supplement refers to any co-registrars (in addition to the
registrar) initially appointed by the Company with respect to any series of
Securities, the Company may at any time terminate the appointment of any such
co-registrar, except that, if Securities of a series are issuable only as
registered Securities, the Company will be required to maintain a registrar for
such series. The Company may at any time designate additional co-registrars with
respect to any series of Securities. (Section 2.04.)
Neither the Company nor the registrar shall be required (i) to issue,
register the transfer of or exchange Securities of any series for the period of
15 days immediately preceding the selection of any such Securities to be
redeemed or (ii) to register the transfer of or exchange Securities of any
series selected, called or being called for redemption as a whole or the portion
being redeemed of any such Securities selected, called or being called for
redemption in part. (Section 2.12.(d))
Payment and Paying Agents
Unless otherwise indicated in an applicable Prospectus Supplement, payment
of (i) principal of (and premium, if any, on) registered Securities will be paid
only against presentation and surrender thereof at the office of the paying
agent (as defined below) in New York, New York, unless the Company shall have
otherwise instructed the Trustee and (ii) interest, if any, on registered
Securities (other than a global Security) may be paid on the interest payment
date for such Securities to the holder thereof at the close of business on the
relevant record date specified in the Securities by check mailed to such
holder's address as it appears on the register for such Securities. (Section
2.05.(b))
Unless otherwise indicated in an applicable Prospectus Supplement, payment
of (i) principal of (and premium, if any, on) bearer Securities will be paid
only against presentation and surrender thereof, (ii) interest, if any, on
bearer Securities will be paid only against presentation and surrender of the
coupons for such interest installments as are evidenced thereby as they mature
and (iii) original issue discount (as defined in the Code), if any, on bearer
Securities will be paid only against presentation and surrender of such
Securities (and in either case, (ii) or (iii), at the office of the paying agent
located outside of the United States, unless the Company shall have otherwise
instructed the Trustee in writing). If at the time that payment of principal of
(and premium, if any), interest, if any, or original issue discount, if any, on
a bearer Security or coupon shall become due, the payment so payable at the
office or offices of all paying agents outside the United States is illegal or
effectively precluded because of the
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imposition of exchange controls or other similar restrictions on the payment of
such amount in United States currency, then the Company may instruct the Trustee
to make such payments at the office of the paying agent located in the United
States. (Section 2.05.(c)) No payment of interest on a bearer Security will be
made unless on the earlier of the date of the first such payment by the Company
or the delivery by the Company of the bearer Security in definitive form
(including interests in a permanent global Security) (the "Certification Date"),
a written certificate in the form and to the effect described under
"Denominations, Registration of Transfer and Exchange" is provided to the
Trustee. (Section 2.08.)
The Company shall maintain in the Borough of Manhattan, The City of New
York, an office or agency where Securities which are issued solely as registered
Securities may be presented for payment ("paying agent"). With respect to any
series of Securities issued in whole or in part as bearer Securities, the
Company shall maintain one or more paying agents located outside the United
States and shall maintain such paying agents for a period of two years after the
principal of such bearer Securities has become due and payable. During any
period thereafter for which it is necessary in order to conform to United States
tax laws or regulations, the Company will maintain a paying agent outside the
United States to which the bearer Securities (or coupons appertaining thereto)
may be presented for payment. The Company may appoint one or more additional
paying agents and may terminate the appointment of any paying agent at any time
upon written notice. The Company initially appoints the Trustee as paying agent.
(Section 2.04.)
Global Securities
The Securities of a series may be issued in whole or in part in the form
of one or more global Securities that will be deposited with or on behalf of a
depositary identified in the Prospectus Supplement relating to such series.
Global Securities may be issued in either registered or bearer form and in
either temporary or permanent form. (Section 2.01.)
The specific terms of the depositary arrangement with respect to any
Securities of a series will be described in the Prospectus Supplement relating
to such series. The Company anticipates that the following provisions will apply
to all depositary arrangements.
Unless otherwise specified in an applicable Prospectus Supplement,
Securities which are to be represented by a global Security in registered form
to be deposited with or on behalf of a depositary will be registered in the name
of such depositary or its nominee. Upon the issuance of a global Security in
registered form, the depositary for such global Security will credit the
respective principal amounts of the Securities represented by such global
Security to the accounts of institutions that have accounts with such depositary
or its nominee ("participants"). The accounts to be credited shall be designated
by the underwriters or agents of such Securities or by the Company, if such
Securities are offered and sold directly by the Company. Ownership of beneficial
interests in such global Securities will be limited to participants or persons
that may hold interests through participants. Ownership of beneficial interests
by participants in such global Securities will be shown on, and the transfer of
that ownership interest will be effected only through, records maintained by the
depositary or its nominee for such global Security. Ownership of beneficial
interests in global Securities by persons that hold through participants will be
shown on, and the transfer of that ownership interest within such participant
will be effected only through, records maintained by such participant. The laws
of some jurisdictions require that certain purchasers of securities take
physical delivery of such securities in definitive form. Such limits and such
laws may impair the ability to transfer beneficial interests in a global
Security.
So long as the depositary for a global Security in registered form, or its
nominee, is the registered owner of such global Security, such depositary or
such nominee, as the case may be, will be considered the sole owner or holder of
the Securities represented by such global Security for all purposes under the
Indenture. Except as set forth below, owners of beneficial interests in such
global Securities will not be entitled to have Securities of the series
represented by such global Security registered in their names, will not receive
or be entitled to receive physical delivery of Securities of such series in
definitive form and will not be considered the owners or holders thereof under
the Indenture.
Payment of principal of, premium, if any, and any interest on Securities
registered in the name of or held by a depositary or its nominee will be made to
the depositary or its nominee, as the case may be, as the registered owner or
the holder of the global Security. Neither the Company, the Trustee, any paying
agent nor the registrar
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for such Securities shall owe any duty or obligation to any beneficial owner of
any Security or have any responsibility or liability for any aspect of the
records or notices relating to or payments made on account of beneficial
ownership interests in a global Security or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests. (Section
2.07.(c))
The Company expects that the depositary for a permanent global Security in
registered form, upon receipt of any payment of principal, premium or interest
in respect of a permanent global Security, will credit immediately participants'
accounts with payments in amounts proportionate to their respective beneficial
interests in the principal amount of such global Security as shown on the
records of such depositary. The Company also expects that payments by
participants to owners of beneficial interests in such global Security held
through such participants will be governed by standing instructions and
customary practices, as is now the case with Securities held for the accounts of
customers in bearer form or registered in "street name", and will be the
responsibility of such participants.
A global Security in registered form may not be transferred except as a
whole by the depositary for such global Security to a nominee of such depositary
or by a nominee of such depositary to such depositary or another nominee of such
depositary or by such depositary or any such nominee to a successor of such
depositary or a nominee of such successor. If a depositary for a permanent
global Security in registered form is at any time unwilling or unable to
continue as depositary and a successor depositary is not appointed by the
Company within 90 days, the Company will issue Securities in definitive
registered form in exchange for the global Security or Securities representing
such Securities. In addition, the Company may at any time and in its sole
discretion determine not to have any Securities in registered form represented
by one or more global Securities and, in such event, will issue Securities in
definitive form in exchange for all of the global Securities representing such
Securities. Further, if the Company so specifies with respect to the Securities
of a series, an owner of a beneficial interest in a global Security representing
Securities of such series may, on terms acceptable to the Company and the
depositary for such global Security, receive Securities of such series in
definitive form. In any such instance, an owner of a beneficial interest in a
global Security will be entitled to physical delivery in definitive form of
Securities of the series represented by such global Security equal in principal
amount to such beneficial interest and to have such Securities registered in its
name (if the Securities of such series are issuable as registered Securities).
Securities of such series so issued in definitive form will be issued as either
registered or bearer Securities if the Securities of such series are issuable in
either form. (Section 2.12) See, however, "Limitation on Issuance of Bearer
Securities" below for a description of certain restrictions on the issuance of a
bearer Security in definitive form in exchange for an interest in a global
Security.
Bearer Debt Securities. If so specified in an applicable Prospectus
Supplement, pending the availability of a permanent global Security, all or any
portion of the Securities of a series which may be issuable as bearer Securities
will initially be represented by one or more temporary global Securities,
without interest coupons, to be delivered to a depositary designated in the
applicable Prospectus Supplement, for the benefit of Morgan Guaranty Trust
Company of New York, Brussels office, as operator of the Euro-clear System
("Euro-clear") and Centrale de Livraison de Valeurs Mobilieres, S.A. ("CEDEL,
S.A.") and for credit to the designated accounts. The interests of the
beneficial owner or owners in a temporary global Security in bearer form will be
exchangeable for definitive Securities (including interests in a permanent
global Security in bearer form), representing Securities having the same
interest rate and stated maturity, but only upon written certification in the
form and to the effect described under "Denominations, Registration of Transfer
and Exchange" unless such certification has been provided on an earlier interest
payment date. The beneficial owner of a Security represented by a temporary
global Security in bearer form or a permanent global Security in bearer form
may, on or after the applicable exchange date and upon 30 days' written notice
to the Trustee or the global exchange agent given through Euro-clear or CEDEL,
S.A., exchange its interest for definitive bearer Securities or, if specified in
an applicable Prospectus Supplement, definitive registered Securities of any
authorized denomination. No bearer Security delivered in exchange for a portion
of a temporary global Security or a permanent global Security shall be mailed or
otherwise delivered to any location in the United States. (Section 2.08.)
Unless otherwise specified in an applicable Prospectus Supplement,
interest in respect of any portion of a temporary global Security in bearer form
payable in respect of an interest payment date occurring prior to the applicable
exchange date will be paid to each of Euro-clear and CEDEL, S.A. with respect to
the portion of the temporary global Security in bearer form held for its
account, but only upon receipt in each case of written certification, in the
form and to the effect described under "Denominations, Registration of Transfer
and Exchange". Each of Euro-clear and CEDEL, S.A. will undertake in such
circumstances to credit such interest received by it
7
<PAGE>
in respect of a temporary global Security in bearer form to the respective
accounts for which it holds such temporary global Security in bearer form as of
the relevant interest payment date.
Certain Covenants
The Company currently has outstanding under its Refunding Mortgage dated
October 1, 1921 ("Mortgage") between the Company and Bankers Trust Company, as
Trustee (as supplemented by 24 supplemental indentures confirming the lien
thereof), its Refunding Mortgage Bonds, Series M through R, inclusive, and T and
V, in the aggregate principal amount of $985,000,000. Substantially all the
property that the Company now owns or hereafter acquires in the State of New
York and all securities (except as specified therein) that the Company now owns
or hereafter acquires, including securities representing the Company's
investment in Empire City Subway Company (Limited), a wholly owned subsidiary of
the Company, and in Telesector Resources Group, Inc., which is owned by the
Company and New England Telephone and Telegraph Company, are subject to the lien
of the Mortgage. As long as any Securities remain outstanding, the Company will
not issue any additional bonds under the Mortgage except bonds issued, as
provided in the Mortgage, in respect either of bonds surrendered for transfer or
exchange or for substitution for mutilated, destroyed, lost or stolen bonds.
Nothing in the Indenture prevents the Company from subjecting any property or
assets to the lien of the Mortgage, or from taking any action that it deems
necessary to comply with the Mortgage. (Section 4.02.)
As long as any Securities remain outstanding, the Company will not issue
additional funded debt securities ranking equally with or prior to the
Securities unless, on the date of the proposed issuance of the new funded debt
securities, the earnings of the Company available for payment of interest
charges during the period of any 12 consecutive calendar months out of the
preceding 15 such months were at least 1.75 times the annualized interest for
that 12-month period on the total of the funded debt securities outstanding
during such period plus the funded debt securities proposed to be issued.
"Earnings of the Company available for payment of interest charges" means income
before extraordinary items plus all (i) taxes in respect of income, (ii)
interest charges on funded debt securities and (iii) interest charges on other
indebtedness retired or to be retired by or in anticipation of funded debt
securities issued during the period or in respect of which the computation is
made. Interest charged to construction is to be includable in income. There will
not be included in annualized interest charges the interest on bonds issued
under the Mortgage or on any other funded debt securities held in any sinking
fund or on any funded debt securities retired or to be retired by or in
anticipation of funded debt securities issued during the period or in respect of
which the computation is made. "Funded debt securities" means securities
evidencing indebtedness of the Company for borrowed money maturing by its terms
more than one year after the date of the issuance of the new funded debt
securities. Any computation pursuant to this provision may, at the Company's
option, be based on consolidated figures of the Company and its consolidated
subsidiaries. (Section 4.03.)
If at any time the Company mortgages, pledges or otherwise subjects to any
lien the whole or any part of any property or assets now owned or hereafter
acquired by it, except as heretofore and hereinafter provided, the Company will
secure the outstanding Securities, and any other obligations of the Company
which may then be outstanding and entitled to the benefit of a covenant similar
in effect to this covenant, equally and ratably with the indebtedness or
obligations secured by such mortgage, pledge or lien, for as long as any such
indebtedness or obligation is so secured. The foregoing covenant does not apply
to the creation, extension, renewal or refunding of purchase-money mortgages or
liens, or to the making of any deposit or pledge to secure public or statutory
obligations or with any governmental agency at any time required by law in order
to qualify the Company to conduct its business or any part thereof or in order
to entitle it to maintain self-insurance or to obtain the benefits of any law
relating to workmen's compensation, unemployment insurance, old age pensions or
other social security, or with any court, board, commission or governmental
agency as security incident to the proper conduct of any proceeding before it.
Nothing contained in the Indenture prevents a person directly or indirectly
controlling or controlled by, or under direct or indirect common control with,
the Company from mortgaging, pledging or subjecting to any lien any property or
assets, whether or not acquired by such person from the Company. (Section 4.04.)
Amendment and Waiver
Subject to certain exceptions, the Indenture or the Securities may be
amended or supplemented by the Company and the Trustee with the consent of the
holders of a majority in principal amount of the outstanding Securities of each
series affected by the amendment or supplement (with each series voting as a
class), or compliance with any
8
<PAGE>
provision may be waived with the consent of the holders of a majority in
principal amount of the outstanding Securities of each series affected by such
waiver (with each series voting as a class). However, without the consent of
each Securityholder affected, an amendment or waiver may not (i) reduce the
amount of Securities whose holders must consent to an amendment or waiver; (ii)
change the rate of or change the time for payment of interest on any Security;
(iii) change the principal of or change the fixed maturity of any Security; (iv)
waive a default in the payment of the principal of or interest on any Security;
(v) make any Security payable in money other than that stated in the Security;
or (vi) impair the right to institute suit for the enforcement of any payment on
or with respect to any Security. (Section 9.02.) The Indenture may be amended or
supplemented without the consent of any Securityholder (i) to cure any
ambiguity, defect or inconsistency in the Indenture or in the Securities of any
series; (ii) to provide for the assumption of all the obligations of the Company
under the Securities and any coupons related thereto and the Indenture by any
corporation in connection with a merger, consolidation, transfer or lease of the
Company's property and assets substantially as an entirety, as provided for in
the Indenture; (iii) to provide for uncertificated Securities in addition to or
in place of certificated Securities; (iv) to make any change that does not
adversely affect the rights of any holder of a Security; (v) to provide for the
issuance of and establish the form and terms and conditions of a series of
Securities or to establish the form of any certifications required to be
furnished pursuant to the terms of the Indenture or any series of Securities; or
(vi) to add to the rights of holders of any series of Securities. (Section
9.01.)
Successor Entity
The Company may not consolidate with, or merge into, or transfer or lease
its property and assets substantially as an entirety to, another entity unless
the successor entity is a corporation and assumes all the obligations of the
Company under the Securities and any coupons related thereto and the Indenture.
Thereafter all such obligations of the Company terminate. (Section 5.01.)
Events of Default
The following events are defined in the Indenture as "Events of Default"
with respect to a series of Securities: (i) default in the payment of interest
on any Security of such series for 90 days; (ii) default in the payment of the
principal of any Security of such series; (iii) failure by the Company for 90
days after notice to it to comply with any of its other agreements in the
Securities of such series, in the Indenture or in any supplemental indenture;
and (iv) certain events of bankruptcy or insolvency. (Section 6.01.) If an Event
of Default occurs with respect to the Securities of any series and is
continuing, the Trustee or the holders of at least 25% in principal amount of
all of the outstanding Securities of that series may declare the principal (or,
if the Securities of that series are original issue discount Securities, such
portion of the principal amount as may be specified in the terms of that series)
of all the Securities of that series to be due and payable. Upon such
declaration, such principal (or, in the case of original issue discount
Securities, such specified amount) shall be due and payable immediately.
(Section 6.02.)
Holders of Securities may not enforce the Indenture or the Securities,
except as provided in the Indenture. The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Securities. (Section
6.06.) Subject to certain limitations, holders of a majority in principal amount
of the Securities of each series affected (with each series voting as a class)
may direct the Trustee in its exercise of any trust power. (Section 6.05.) The
Trustee may withhold from holders of Securities notice of any continuing default
(except a default in payment of principal or interest) if it determines that
withholding notice is in their interests. (Section 7.05.)
Concerning The Trustee
The Company maintains banking relationships in the ordinary course of
business with the Trustee. The Trustee also serves as trustee for the Company's
Five Year 51/4% Notes due September 1, 1998, Ten Year 57/8% Notes due September
1, 2003, Ten Year 55/8% Notes due November 1, 2003, Ten Year 61/4% Notes due
February 15, 2004, Twelve Year 6.125% Debentures, due January 15, 2010, Thirty
Year 6.70% Debentures due November 1, 2023, Thirty Year 71/4% Debentures due
February 15, 2024, Thirty-Two Year 7% Debentures due August 15, 2025, and Forty
Year 7% Debentures due December 1, 2033, all issued under an Indenture dated as
of June 1, 1993 from the Company to the Trustee. Walter V. Shipley, the Chairman
of the Board and Chief Executive Officer of the Trustee and The Chase Manhattan
Corporation, the parent of the Trustee, is a director of the Company and Bell
Atlantic. John R. Stafford, a director of the Trustee and The Chase Manhattan
Corporation, is a director of the Company and Bell Atlantic.
9
<PAGE>
LIMITATIONS ON ISSUANCE OF BEARER SECURITIES
In compliance with United States federal tax laws and regulations, bearer
Securities may not be offered or sold during the restricted period (as defined
under "Description of Securities--Denominations, Registration of Transfer and
Exchange"), or delivered in definitive form in connection with a sale during the
restricted period, in the United States or to a United States person (each as
defined below), except to the extent permitted under Section 1.163-5
(c)(2)(i)(D) of the United States Treasury Regulations (the "D" Rules). Any
underwriters, agents and dealers participating in the offering of Securities
must agree not to offer or sell bearer Securities in the United States or to
United States persons, except to the extent permitted under the D Rules, nor
deliver bearer Securities within the United States.
Bearer Securities and their interest coupons will bear a legend
substantially to the following effect: "Any United States person who holds this
obligation will be subject to limitations under the United States income tax
laws, including the limitations provided in Section 165(j) and 1287(a) of the
Internal Revenue Code". The sections referred to in such legend provide that a
United States person, with certain exceptions, will not be entitled to deduct
any loss on bearer Securities and must treat as ordinary income any gain
realized on a sale or other disposition of bearer Securities.
Purchasers of bearer Securities may be affected by certain limitations
under United States tax laws. See "United States Taxation--Backup Withholding".
As used herein, "United States person" means a citizen or resident of the
United States, a corporation, partnership or other entity created or organized
in or under the laws of the United States, an estate the income of which is
subject to United States federal income taxation regardless of its source or a
trust which is subject to the supervision of a court within the United States
and the control of a United States person as described in Section 7701(a)(30) of
the Code. "United States" means the United States of America (including the
States and the District of Columbia) and its possessions including Puerto Rico,
the United States Virgin Islands, Guam, American Samoa, Wake Island and the
Northern Mariana Islands.
UNITED STATES TAXATION
THE DISCUSSION SET FORTH BELOW IS INTENDED ONLY AS A SUMMARY OF CERTAIN OF
THE UNITED STATES FEDERAL INCOME AND ESTATE TAX CONSEQUENCES APPLICABLE TO THE
OWNERSHIP OF SECURITIES BY UNITED STATES ALIENS AND DOES NOT PURPORT TO BE A
COMPLETE ANALYSIS OR LISTING OF ALL POTENTIAL TAX EFFECTS RELEVANT TO A DECISION
TO PURCHASE SECURITIES. SUCH DISCUSSION DOES NOT ADDRESS ANY TAX CONSEQUENCES
THAT MAY BE RELEVANT TO INVESTORS THAT ARE NOT UNITED STATES ALIENS OR ANY TAX
CONSEQUENCES ARISING UNDER THE LAWS OF ANY STATE, LOCALITY OR NON-UNITED STATES
JURISDICTION. OTHER SIGNIFICANT UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
THAT MAY BE RELEVANT TO A PARTICULAR OFFERING OF SECURITIES WILL BE SET FORTH IN
THE APPROPRIATE PROSPECTUS SUPPLEMENT. FURTHERMORE, THE DISCUSSION SET FORTH
BELOW IS BASED ON THE CODE, REGULATIONS, RULINGS AND JUDICIAL DECISIONS AS OF
THE DATE HEREOF, AND SUCH AUTHORITIES MAY BE REPEALED, REVOKED OR MODIFIED SO AS
TO MAKE THE FOLLOWING ANALYSIS INAPPLICABLE. IT IS RECOMMENDED THAT ALL
PROSPECTIVE INVESTORS CONSULT THEIR OWN TAX ADVISORS CONCERNING THE TAX
CONSIDERATIONS OF THIS OFFERING.
Under present United States federal income and estate tax law, and subject
to the discussion below concerning backup withholding:
(a) no withholding of United States federal income tax will be
required with respect to the payment by the Company or any paying agent of
principal, premium, if any, or interest (which for purposes of this
discussion includes original issue discount ("OID")) on a Security owned
by a United States Alien (as defined below), provided that, in the case of
interest (i) the beneficial owner does not actually or constructively own
10% or more of the total combined voting power of all classes of stock of
the Company entitled to vote within the meaning of Section 871(h)(3) of
the Code and the regulations thereunder, (ii) the beneficial owner is not
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<PAGE>
a controlled foreign corporation that is related to the Company through
stock ownership, (iii) in the case of a registered Security, the
beneficial owner satisfies the statement requirement (described generally
below) set forth in Section 871(h) and Section 881(c) of the Code and the
regulations thereunder, and (iv) the beneficial owner is not a bank whose
receipt of interest on a Security is described in Section 881(c)(3)(A) of
the Code;
(b) no withholding of United States federal income tax will be
required with respect to any gain or income realized by a United States
Alien upon the sale, exchange or retirement of a Security; and
(c) a Security beneficially owned by an individual who at the time
of death is a United States Alien will not be subject to United States
federal estate tax as a result of such individual's death, provided that
such individual does not actually or constructively own 10% or more of the
total combined voting power of all classes of stock of the Company
entitled to vote within the meaning of Section 871(h)(3) of the Code and
provided that the interest payments with respect to such Security would
not have been, if received at the time of such individual's death,
effectively connected with a United States trade or business of such
individual.
To qualify for the exemption from withholding tax in (a)(iii) above, the
beneficial owner of a registered Security, or a financial institution holding
the Security on behalf of such owner, must provide, in accordance with specified
procedures, a paying agent of the Company with a statement to the effect that
the beneficial owner is not a United States person, citizen or resident.
Currently, these requirements will be met if (1) the beneficial owner provides
his name and address and certifies, under penalties of perjury, that he is not a
United States person, citizen or resident (which certification may be made on an
Internal Revenue Service Form W-8 or a successor form) or (2) a financial
institution holding the Security on behalf of the beneficial owner certifies,
under penalties of perjury, that such statement has been received by it and
furnishes a paying agent with a copy thereof. Under Treasury regulations
finalized in 1997 (the "Final Regulations"), the statement requirement referred
to in (a)(iii) above may also be satisfied with other documentary evidence for
interest paid after December 31, 1998 with respect to an offshore account or
through certain foreign intermediaries.
Payments to United States Aliens not meeting the requirements of paragraph
(a) above and thus subject to 30% withholding of United States federal income
tax may nevertheless be exempt from such withholding if the beneficial owner of
the Security provides the Company with a properly executed (1) Internal Revenue
Service Form 1001 (or a successor form) claiming an exemption from withholding
under the benefit of a tax treaty or (2) Internal Revenue Service Form 4224 (or
a successor form) stating that interest paid on the Security is not subject to
withholding because it is effectively connected with the owner's conduct of a
trade or business in the United States. Under the Final Regulations, United
States Aliens will generally be required to provide Internal Revenue Service
Form W-8 in lieu of Internal Revenue Service Form 1001 and Internal Revenue
Service Form 4224, although alternative documentation may be applicable in
certain situations.
If a United States Alien is engaged in a trade or business in the United
States and premium, if any, or interest (including OID) on a Security is
effectively connected with the conduct of such trade or business, the United
States Alien, although exempt from the withholding tax discussed above, will be
subject to United States federal income tax on such interest and OID on a net
income basis in the same manner as if it were a United States person. In
addition, if such holder is a foreign corporation, it may be subject to a branch
profits tax equal to 30% of its effectively connected earnings and profits for
the taxable year, subject to adjustments. For this purpose, such premium, if
any, and interest (including OID) on a Security will be included in such foreign
corporation's earnings and profits.
Any gain or income realized upon the sale, exchange, retirement or other
disposition of a Security generally will not be subject to United States federal
income tax unless (i) such gain or income is effectively connected with a trade
or business in the United States of the United States Alien, or (ii) in the case
of a United States Alien who is an individual, such individual is present in the
United States for 183 days or more in the taxable year of such sale, exchange,
retirement or other disposition, and certain other conditions are met.
As used herein, "United States Alien" means any corporation, partnership,
individual or fiduciary that is, as to the United States, a foreign corporation,
a nonresident alien individual, a nonresident fiduciary of a foreign estate or
trust, or a foreign partnership one or more of the members of which is, as to
the United States, a foreign corporation, a nonresident alien individual or a
nonresident fiduciary of a foreign estate or trust.
11
<PAGE>
Backup Withholding
Under certain circumstances, the Company or its paying agent will have to
report to the United States Internal Revenue Service payments of principal,
interest, original issue discount, if any, and any premium. In addition, the
Company or its paying agent may have to withhold 31% of such payments and
deposit such amounts with the Internal Revenue Service ("backup withholding").
Generally, no information reporting or backup withholding will be required
with respect to payments by the Company or a paying agent to United States
Aliens (1) if those payments are made outside of the United States on bearer
Securities or (2) on registered Securities with respect to which a statement
described in (a)(iii) above has been received and the payor does not have actual
knowledge that the beneficial owner is a United States person.
In addition, backup withholding and information reporting will not apply if
the principal of, premium, if any, or interest on a Security is paid or
collected by a foreign office of a custodian, nominee or other foreign agent on
behalf of the beneficial owner of such Security, or if a foreign office of a
broker (as defined in applicable Treasury regulations) pays the proceeds of the
sale of a Security to the owner thereof. If, however, such nominee, custodian,
agent or broker is, for United States federal income tax purposes, a United
States person, a controlled foreign corporation or a foreign person that derives
50% or more of its gross income for certain periods from the conduct of a United
States trade or business, or, after December 31, 1998, if such nominee,
custodian, agent or broker is a foreign partnership, in which one or more United
States persons, in the aggregate, own more than 50% of the income or capital
interests in the partnership or if the partnership is engaged in a trade or
business in the United States, such payments will not be subject to backup
withholding but will be subject to information reporting, unless (1) such
custodian, nominee, agent or broker has documentary evidence in its records that
the beneficial owner is not a United States person and certain other conditions
are met or (2) the beneficial owner otherwise establishes an exemption.
Principal of, premium, if any, and interest on a Security paid to the
beneficial owner of such Security by a United States office of a custodian,
nominee or agent, or the payment by the United States office of a broker of the
proceeds of sale of such Security, will be subject to both backup withholding
and information reporting unless the beneficial owner provides the statement
referred to in (a) (iii) above and the payor does not have actual knowledge that
the beneficial owner is a United States person or otherwise establishes an
exemption.
Any amounts withheld under the backup withholding rules will be allowed as
a refund or a credit against such United States Alien's United States federal
income tax liability provided the required information is furnished to the
Internal Revenue Service.
PLAN OF DISTRIBUTION
General
The Company may sell the Securities being offered hereby: (i) directly to
purchasers, (ii) through agents, (iii) through underwriters, (iv) through
dealers or (v) through a combination of any such methods of sale.
The distribution of the Securities may be effected from time to time in
one or more transactions either: (i) at a fixed price or prices, which may be
changed, (ii) at market prices prevailing at the time of sale, (iii) at prices
related to such prevailing market prices or (iv) at negotiated prices.
Offers to purchase Securities may be solicited directly by the Company or
by agents designated by the Company from time to time. Any such agent, which may
be deemed to be an underwriter as that term is defined in the Securities Act,
involved in the offer or sale of the Securities in respect of which this
Prospectus is delivered will be named, and any commissions payable by the
Company to such agent will be set forth, in the Prospectus Supplement. Unless
otherwise indicated in the Prospectus Supplement, any such agent will be acting
on a best efforts basis for the period of its appointment (ordinarily five
business days or less). Agents may be customers of, engage in transactions with,
or perform services for, the Company in the ordinary course of business.
If an underwriter or underwriters are utilized in the sale, the Company
will execute an underwriting agreement with such underwriters at the time of
sale to them, and the names of the underwriters and the terms of the
transactions will be set forth in the Prospectus Supplement, which will be used
by the underwriters to make resales of the Securities in respect of which this
Prospectus is delivered to the public.
12
<PAGE>
If a dealer is utilized in the sale of the Securities in respect of which
this Prospectus is delivered, the Company will sell such Securities to the
dealer, as principal. The dealer may then resell such Securities to the public
at varying prices to be determined by such dealer at the time of resale.
Securities may also be offered and sold, if so indicated in the Prospectus
Supplement, in connection with a remarketing upon their purchase, in accordance
with a redemption or repayment pursuant to their terms, or otherwise, by one or
more firms ("remarketing firms"), acting as principals for their own accounts or
as agents for the Company. Any remarketing firm will be identified and the terms
of its agreement, if any, with the Company and its compensation will be
described in the Prospectus Supplement. Remarketing firms may be deemed to be
underwriters, as that term is defined in the Securities Act, in connection with
the Securities remarketed thereby.
Underwriters, dealers, agents and remarketing firms may be customers of,
engage in transactions with, or perform services for, the Company in the
ordinary course of business. Also, underwriters, dealers, agents, remarketing
firms and other persons may be entitled, under agreements which may be entered
into with the Company, to indemnification against, or contribution with respect
to, certain civil liabilities, including liabilities under the Securities Act.
Each underwriter, dealer, agent and remarketing firm participating in the
distribution of any Securities that are issuable as bearer Securities will agree
that it will not offer, sell or deliver, directly or indirectly, bearer
Securities in the United States or to United States persons (other than
qualifying financial institutions) in connection with the original issuance of
such Securities.
Delayed Delivery Arrangements
If so indicated in the Prospectus Supplement, the Company will authorize
agents and underwriters to solicit offers by certain institutions to purchase
Securities from the Company at the public offering price set forth in the
Prospectus Supplement pursuant to Delayed Delivery Contracts (the "Contracts")
providing for payment and delivery on the date stated in the Prospectus
Supplement. Each Contract will be for an amount not less than, and unless the
Company otherwise agrees, the aggregate principal amount of Securities sold
pursuant to Contracts shall be not less nor more than, the respective amounts
stated in the Prospectus Supplement. Institutions with whom Contracts, when
authorized, may be made include commercial and savings banks, insurance
companies, pension funds, investment companies, educational and charitable
institutions and other institutions, but shall in all cases be subject to the
approval of the Company. Contracts will not be subject to any conditions except
that the purchase by an institution of the Securities covered by its Contract
shall not at the time of delivery be prohibited under the laws of any
jurisdiction in the United States to which such institution is subject. A
commission indicated in the Prospectus Supplement will be paid to underwriters
and agents soliciting purchases of Securities pursuant to Contracts accepted by
the Company.
The place and time of delivery for the Securities in respect of which this
Prospectus is delivered are set forth in the accompanying Prospectus Supplement.
EXPERTS
The consolidated balance sheets as of December 31, 1996 and 1995 and the
consolidated statements of income and reinvested earnings (accumulated deficit)
and cash flows for each of the three years in the period ended December 31, 1996
and the related consolidated financial statement schedule, all incorporated by
reference in this Prospectus, have been incorporated herein in reliance on the
report of Coopers & Lybrand L.L.P., independent accountants, given on the
authority of that firm as experts in accounting and auditing.
LEGAL MATTERS
The legality of the Securities offered hereby will be passed upon for the
Company by Sandra DiIorio Thorn, General Counsel of the Company, and for the
agents or underwriters, if any, by Simpson Thacher & Bartlett (a partnership
which includes professional corporations), 425 Lexington Avenue, New York, New
York 10017. Simpson Thacher & Bartlett from time to time has acted as counsel in
certain matters for the Company and certain of its affiliates.
13
<PAGE>
================================================================================
No person has been authorized to give
any information or to make any
representations other than those
contained in this Prospectus and, if
given or made, such information or
representations must not be relied
upon as having been authorized. This
Prospectus does not constitute an
offer to sell or the solicitation of
an offer to buy any securities other
than the securities described in this
Prospectus or an offer to sell or the New York Telephone
solicitation of an offer to buy such Company
securities in any circumstances in
which such offer or solicitation is d/b/a Bell Atlantic -- New York
unlawful. Neither the delivery of this
Prospectus nor any sale made hereunder
shall, under any circumstances, create
any implication that the information $750,000,000
contained herein or therein is correct
as of any time subsequent to the date
of such information.
Debt Securities
-----------------
TABLE OF CONTENTS
Page
----
Available Information ............. 2
Incorporation of Documents by
Reference ...................... 2
The Company ....................... 3
Use of Proceeds ................... 3
Ratio of Earnings to Fixed Charges 3
Description of Securities ......... 3
Limitations on Issuance of Bearer
Securities ..................... 10
United States Taxation ............ 10
Plan of Distribution .............. 12
Experts ........................... 13
Legal Matters ..................... 13
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
Securities and Exchange Commission Filing Fee ................. $221,250
Rating Agency Fees ............................................ 230,000*
Fees and Expenses of Trustee .................................. 5,000*
Printing and Distributing Prospectus .......................... 70,000*
Accountants' Fees and Expenses ................................ 40,000*
Legal and Blue Sky Fees and Expenses .......................... 3,000*
Miscellaneous Expenses ........................................ 5,750*
--------
Total ......................................................... $575,000*
========
- ----------------
* Estimated.
Item 15. Indemnification of Directors and Officers
Pursuant to the New York Business Corporation Law ("BCL"), a director or
officer of a corporation is entitled, under specified circumstances, to
indemnification by the corporation against reasonable expenses, including
attorneys' fees, incurred by him in connection with the defense of a civil or
criminal proceeding to which he has been made, or threatened to be made, a party
by reason of the fact that he was such director or officer. In certain
circumstances, indemnity is provided against judgments, fines and amounts paid
in settlement. In general, indemnification is not available where the director
or officer has been adjudged to have breached his duty to the corporation or
where he did not act in good faith. Specific court approval is required in some
cases. The BCL further provides that the indemnification provided pursuant to it
shall not be deemed exclusive of any other rights to which those seeking
indemnification may be entitled under the certificate of incorporation or
by-laws, or if authorized by the certificate of incorporation or by-laws by an
agreement or a resolution of shareholders or directors. In accordance with this
provision, the By-Laws of the registrant authorize the registrant to indemnify
its directors and officers to the fullest extent authorized or permitted by law
pursuant to a resolution of the shareholder or the directors or an
indemnification agreement. Pursuant to this authorization, the Board of
Directors adopted resolutions providing that under certain circumstances the
registrant shall indemnify, and advance expenses to, any director or officer who
meets specified standards. The foregoing statement is subject to the detailed
provisions of Sections 715, 717 and 721-726 of the BCL, to which reference is
hereby made.
The directors and officers of the registrant are covered by insurance
policies indemnifying against certain liabilities, including certain liabilities
arising under the Securities Act of 1933, which might be incurred by them in
such capacities and against which they cannot be indemnified by the registrant.
Any underwriters, dealers or agents referred to in the prospectus
contained in this registration statement will agree to indemnify the
registrant's directors and its officers who signed the registration statement
against certain liabilities which might arise under the Securities Act of 1933
from information furnished to the registrant by or on behalf of any such
indemnifying party.
Item 16. Exhibits
The Exhibit Index beginning on page E-1 is hereby incorporated by
reference.
Item 17. Undertakings
The registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made
of the securities registered hereby, 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 this registration statement (or the most
recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information set
forth in this registration statement;
II-1
<PAGE>
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in this registration
statement or any material change to such information in this
registration statement;
provided, however, that the undertakings set forth in paragraphs (1)(i) and (ii)
above do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic reports
filed by the registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in this
registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered herein, 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) 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 (and, where
applicable, each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in this registration statement shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the provisions referred to in Item 15 (other than the
insurance policies referred to therein), or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act of
1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted against the registrant by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act of 1933 and will be governed by the final
adjudication of such issue.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in The City of New York, State of New York, on the 6th day of
February, 1998.
NEW YORK TELEPHONE COMPANY
By /s/ Edwin F. Hall
-----------------
Controller
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated:
Signature Title Date
- ------------------------- ---------------------------------- -----------------
* Director February 6, 1998
- -------------------------
Richard L. Carrion
* Director February 6, 1998
- -------------------------
Stanley P. Goldstein
* Controller (principal February 6, 1998
- ------------------------- accounting officer)
Edwin F. Hall
* Director February 6, 1998
- -------------------------
Helene L. Kaplan
* Director February 6, 1998
- -------------------------
Elizabeth T. Kennan
* Director February 6, 1998
- -------------------------
John F. Maypole
* Director February 6, 1998
- -------------------------
Joseph Neubauer
* Director February 6, 1998
- -------------------------
Hugh B. Price
* Director, Chairman of the Board, February 6, 1998
- ------------------------- President and
Ivan G. Seidenberg Chief Executive Officer
(principal executive officer)
* Director February 6, 1998
- -------------------------
Walter V. Shipley
II-3
<PAGE>
Signature Title Date
- ------------------------- ---------------------------------- -----------------
* Director February 6, 1998
- -------------------------
John R. Stafford
* Director February 6, 1998
- -------------------------
Lodewijk J.R. de Vink
* Chief Financial Officer February 6, 1998
- ------------------------- (principal financial officer)
Doreen A. Toben
*By: /s/ Edwin F. Hall
- -------------------------
Edwin F. Hall
As Attorney-in-fact and on
his own behalf as
principal accounting
officer
II-4
<PAGE>
EXHIBIT INDEX
Page Number
in Sequential
Exhibit Numbering
Number Description System
- --------- --------------------------------------------------------------------
1 Form of Underwriting Agreement
4 Indenture from the Company to The Chase Manhattan
Bank, Trustee, dated as of February 1, 1998. The
form or forms of Security with respect to each
particular series of Securities registered hereunder
will be filed as an exhibit to a Current Report on
Form 8-K of the Company and incorporated herein
by reference.
5 Opinion of Sandra DiIorio Thorn, General Counsel
of the Company, as to the legality of the Securities
to be issued.
12 Computation of Ratio of Earnings to Fixed Charges
(incorporated herein by reference to Exhibit 12 to
the Company's Current Report on Form 8-K dated
January 12, 1998).
23-a Consent of Coopers & Lybrand L.L.P., Independent
Accountants.
23-b Consent of Sandra DiIorio Thorn, General Counsel
of the Company (contained in her Opinion filed as
Exhibit 5 hereto).
24 Powers of Attorney.
25 Statement of Eligibility of The Chase Manhattan
Bank, Trustee, on Form T-1.
NEW YORK TELEPHONE COMPANY
DEBT SECURITIES
UNDERWRITING AGREEMENT
New York, New York
____________, 1998
To the Representatives
named in Schedule I
hereto of the Underwriters
named in Schedule II hereto
Dear Sirs:
New York Telephone Company, a New York corporation ("Company"), may
issue and sell from time to time series of its debt securities registered under
the registration statement referred to in Paragraph 1(a) hereof ("Securities"
and individually "Security"). The Company proposes to sell to the underwriters
named in Schedule II hereto ("Underwriters"), for whom you are acting as
representatives ("Representative"), a series of Securities, of the designation,
with the terms and in the aggregate principal amount specified in Schedule I
hereto ("Underwritten Securities" and individually "Underwritten Security"). If
the firm or firms listed in Schedule II hereto include only the firm or firms
listed in Schedule I hereto, then the terms "Underwriters" and "Representative"
shall each be deemed to refer to such firm or firms.
1. The Company represents, warrants and agrees that:
(a) A registration statement (No. ___________), including a
prospectus, with respect to the Securities have been prepared by the
Company in conformity with the requirements of the Securities Act of
1933, as amended ("Act"), and the rules and regulations ("Rules and
Regulations") of the Securities and Exchange Commission ("Commission")
thereunder and have become effective. As used in this Agreement, (i)
such registration statement (No. ____________), as amended and
supplemented to the date hereof, is referred to as the "Registration
Statement"; (ii) "Preliminary Prospectus" means each prospectus
(including all documents incorporated therein by reference) included in
the Registration Statement, or amendments or supplements thereof,
before it became effective under the Act, including any prospectus
filed with the Commission pursuant to Rule 424(a) of the Rules and
Regulations; and (iii) "Prospectus" means the prospectus included in
the Registration Statement, including any preliminary or final
prospectus amendment or supplement (including in each case all
documents incorporated therein by reference) specifically relating to
the Underwritten Securities, as filed with the Commission pursuant to
paragraph (b) of Rule 424 of the Rules and Regulations. The Commission
has not issued any order preventing or suspending the use of any
Prospectus, and no proceedings for such purposes have been instituted
or are pending or, to the knowledge of the Company, are contemplated by
the
<PAGE>
2
Commission, and any request on the part of the Commission for
additional information has been complied with.
(b) The Registration Statement and each Prospectus contain, and
(in the case of any amendment or supplement to any such document, or
any material incorporated by reference in any such document, filed with
the Commission after the date as of which this representation is being
made) will contain at all times during the period specified in
Paragraph 7(c) hereof, all statements which are required by the Act,
the Securities Exchange Act of 1934, as amended ("Exchange Act"), the
Trust Indenture Act of 1939, as amended ("Trust Indenture Act"), and
the rules and regulations of the Commission under such Acts; the
indenture, including any amendments and supplements thereto, pursuant
to which the Underwritten Securities will be issued ("Indenture") will
conform with the requirements of the Trust Indenture Act and the rules
and regulations of the Commission thereunder; and the Registration
Statement and each Prospectus do not, and (in the case of any amendment
or supplement to any such document, or any material incorporated by
reference in any such document, filed with the Commission after the
date as of which this representation is being made) will not, at any
time during the period specified in Paragraph 7(c) hereof, contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading; provided that the Company makes no
representation or warranty as to information contained in or omitted
from the Registration Statement or any Prospectus in reliance and based
upon information furnished to the Company through the Representative by
or on behalf of any Underwriter, or as to any statements in or
omissions from the Statement of Eligibility of the Trustee under the
Indenture.
(c) Neither the Company nor any of its subsidiaries (as defined in
Paragraph 14 hereof) is in violation of its corporate charter or
by-laws or in default under any agreement, indenture or instrument,
except for such defaults that would not result in a material adverse
change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company or the Company
and its subsidiaries taken as a whole, whether or not arising in the
ordinary course of business (a "Material Adverse Effect"); and the
execution, delivery and performance of this Agreement, the Indenture,
the Underwritten Securities, and any Delayed Delivery Contracts (as
defined in Paragraph 3 hereof) and the consummation of the transactions
contemplated herein, and in the Prospectus (including the issuance and
sale of the Underwritten Securities and the use of the proceeds from
the sale thereof as described in the Prospectus under the caption "Use
of Proceeds") have been duly authorized by all necessary corporate
action and do not and will not conflict with or constitute a breach of,
or default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
of its subsidiaries pursuant to, any material agreement, indenture or
instrument to which the Company or any of its subsidiaries is a party
or by which any of them is bound or to which any of their respective
properties or assets is subject, nor will such action result in a
material violation of the charter or by-laws of the Company or any of
its subsidiaries or any order, rule or regulation of any court or
governmental agency having jurisdiction over
<PAGE>
3
the Company, any of its subsidiaries or their respective properties;
and except as required by the Act, the Trust Indenture Act, the
Exchange Act and applicable state securities laws and except as set
forth in Paragraph 1(m) hereof, no consent, authorization or order of,
or filing or registration with, any court or governmental agency is
required for the execution, delivery and performance of this Agreement,
the Delayed Delivery Contracts and the Indenture or the consummation of
the transactions contemplated hereby and thereby.
(d) Except as described in or contemplated by the Registration
Statement and each Prospectus, there has been no Material Adverse
Effect from the dates as of which information is given in the
Registration Statement and each Prospectus.
(e) Coopers & Lybrand, whose report appears in the Company's most
recent Annual Report on Form 10-K which is incorporated by reference in
each Prospectus, are independent accountants as required by the Act and
the Rules and Regulations.
(f) On the Delivery Date (as defined in Paragraph 6 hereof) (i)
the Indenture will have been validly authorized, executed and delivered
by the Company and duly qualified under the Trust Indenture Act and
will constitute the legally binding obligation of the Company, (ii) the
Underwritten Securities will have been validly authorized and executed
and, upon payment therefor as provided in this Agreement, will be
validly issued and outstanding, and will constitute legally binding
obligations of the Company entitled to the benefits of the Indenture,
and (iii) the Underwritten Securities and the Indenture will conform to
the descriptions thereof contained in the Prospectus.
(g) This Agreement has been validly authorized, executed and
delivered by the Company.
(h) The Company and each of its subsidiaries have been duly
incorporated and are validly existing and in good standing under the
laws of their respective jurisdictions of incorporation, are duly
qualified to do business and in good standing as foreign corporations
in each jurisdiction in which their respective ownership of properties
or the conduct of their respective businesses requires such
qualification, except where the failure to so qualify would not have a
Material Adverse Effect, and have power and authority necessary to own
or hold their respective properties and to conduct the businesses in
which they are engaged and, with respect to the Company, to enter into
and perform its obligations under this Agreement.
(i) There is no material action, suit or proceeding before any
court or governmental agency or body, domestic or foreign, now pending,
or, to the knowledge of the Company, threatened, against or affecting
the Company or any of its subsidiaries, which is required to be
disclosed in any Prospectus (other than as disclosed therein), or which
might reasonably be expected to result in a Material Adverse Effect, or
which might reasonably be expected to materially and adversely affect
the properties or assets thereof or the consummation of the
transactions
<PAGE>
4
contemplated in this Agreement or the performance by the Company of its
obligations hereunder.
(j) The financial statements filed as part of the Registration
Statement or included in any Preliminary Prospectus present, or (in the
case of any amendment or supplement to any such document, or any
material incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will present at all times during the period specified in
Paragraph 7(c) hereof, fairly, the financial condition and results of
operations of the Company and its consolidated subsidiaries, at the
dates and for the periods indicated, and have been, and (in the case of
any amendment or supplement to any such document, or any material
incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will be at all times during the period specified in Paragraph
7(c) hereof, prepared in conformity with generally accepted accounting
principles ("GAAP") applied on a consistent basis throughout the
periods involved. The supporting schedules incorporated by reference in
any Prospectus present fairly in accordance with GAAP the information
required to be stated therein. The pro forma financial statements and
the related notes thereto incorporated by reference in the Registration
Statement and any Prospectus present fairly the information shown
therein, have been prepared in accordance with the Commission's rules
and guidelines with respect to pro forma financial statements and have
been properly compiled on the bases described therein, and the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein.
(k) The documents incorporated by reference into any Preliminary
Prospectus or Prospectus have been, and (in the case of any amendment
or supplement to any such document, or any material incorporated by
reference in any such document, filed with the Commission after the
date as of which this representation is being made) will be at all
times during the period specified in Paragraph 7(c) hereof, prepared by
the Company in conformity with the applicable requirements of the Act
and Rules and Regulations and the Exchange Act and the rules and
regulations of the Commission thereunder and such documents have been,
or (in the case of any amendment or supplement to any such document, or
any material incorporated by reference in any such document, filed with
the Commission after the date as of which this representation is being
made) will be at all times during the period specified in Paragraph
7(c) hereof, timely filed as required thereby.
(l) There are no contracts or other documents which are required
to be filed as exhibits to the Registration Statement by the Act or by
the Rules and Regulations, or which were required to be filed as
exhibits to any document incorporated by reference in any Prospectus by
the Exchange Act or the rules and regulations of the Commission
thereunder, which have not been filed as exhibits to the Registration
Statement or to such document or incorporated therein by reference as
permitted by the Rules and Regulations or the rules and regulations of
the Commission under the Exchange Act as required.
<PAGE>
5
(m) The Company has filed a petition or petitions with the Public
Service Commission of the State of New York ("PSC") with respect to the
issue and sale of securities, including the Underwritten Securities.
The PSC has authorized the issue and sale thereof but upon the express
condition that the Company shall have fulfilled certain obligations,
such authority being subject under certain circumstances to abrogation
by order issued by one or more Commissioners of the PSC within the
period of time after the fulfillment of such obligations as may have
been specified by the PSC in its order granting such authorization,
unless prior to the expiration of such period the Company shall be
advised by the Director of the Office of Accounting and Finance of the
PSC or his designee that the applicable conditions have been met and
that such authority is not to be abrogated.
(n) The Company and each of its subsidiaries has good and valid
title to all or substantially all of their respective properties,
subject only to the lien of the Refunding Mortgage as set forth in the
Prospectus.
(o) The Company is not, and upon the issuance and sale of the
Underwritten Securities as herein contemplated and the application of
the net proceeds therefrom as described in the Prospectus will not be,
an "investment company" or an entity "controlled" by an "investment
company" as such terms are defined in the Investment Company Act of
1940, as amended (the "1940 Act").
2. Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company agrees to sell to
each Underwriter, severally and not jointly, and each Underwriter agrees,
severally and not jointly, to purchase from the Company, at the purchase price
and on the other terms set forth in Schedule I hereto, the principal amount of
the Underwritten Securities set forth opposite its name in Schedule II hereto.
3. Any offer to purchase Underwritten Securities by institutional
investors solicited by the Underwriters for delayed delivery shall be made
pursuant to contracts substantially in the form of Exhibit A attached hereto,
with such changes therein as the Company and the Representative may approve
("Delayed Delivery Contracts"). The Company shall have the right, in its sole
discretion, to approve or disapprove each such institutional investor.
Underwritten Securities which are subject to Delayed Delivery Contracts are
herein sometimes called "Delayed Delivery Underwritten Securities" and
Underwritten Securities which are not subject to Delayed Delivery Contracts are
herein sometimes called "Immediate Delivery Underwritten Securities".
Contemporaneously with the purchase on the Delivery Date by the
Underwriters of the Immediate Delivery Underwritten Securities pursuant to this
Agreement, the Company will pay to the Representative, for the account of the
Underwriters, the compensation specified in Schedule I hereto for arranging the
sale of Delayed Delivery Underwritten Securities. The Underwriters shall have no
responsibility with respect to the validity or performance of any Delayed
Delivery Contracts.
<PAGE>
6
For the purposes of determining the principal amount of Immediate
Delivery Underwritten Securities to be purchased by each Underwriter, there
shall be deducted from the principal amount of Underwritten Securities to be
purchased by such Underwriter as set forth in Schedule II hereto that portion of
the aggregate principal amount of Delayed Delivery Underwritten Securities that
the principal amount of Underwritten Securities to be purchased by such
Underwriter as set forth in Schedule II hereto bears to the aggregate principal
amount of Underwritten Securities set forth there to be purchased by all of the
Underwriters (in each case as adjusted by the Representative to avoid fractions
of the minimum principal amount in which the Underwritten Securities may be
issued), except to the extent that the Representative determines, in its
discretion, that such deduction shall be otherwise than in such proportion and
so advises the Company.
4. The Company shall not be obligated to deliver any Underwritten
Securities except upon payment for all Immediate Delivery Underwritten
Securities to be purchased pursuant to this Agreement as hereinafter provided.
5. If any Underwriter defaults in the performance of its obligations
under this Agreement, the remaining non-defaulting Underwriters, if any, shall
be obligated to purchase the Immediate Delivery Underwritten Securities which
the defaulting Underwriter agreed but failed to purchase in the respective
proportions which the principal amount of Underwritten Securities set forth in
Schedule II hereto to be purchased by each remaining non-defaulting Underwriter
set forth therein bears to the aggregate principal amount of Underwritten
Securities set forth therein to be purchased by all the remaining non-defaulting
Underwriters; provided that the remaining non-defaulting Underwriters shall not
be obligated to purchase any Immediate Delivery Underwritten Securities if the
aggregate principal amount of Immediate Delivery Underwritten Securities which
the defaulting Underwriter or Underwriters agreed but failed to purchase exceeds
9.09% of the total principal amount of Underwritten Securities, and any
remaining non-defaulting Underwriter shall not be obligated to purchase more
than 110% of the principal amount of Underwritten Securities set forth in
Schedule II hereto to be purchased by it. If the foregoing maximums are
exceeded, the remaining non-defaulting Underwriters, or those other underwriters
satisfactory to the Representative who so agree, shall have the right, but shall
not be obligated, to purchase, in such proportion as may be agreed upon among
them, all the Immediate Delivery Underwritten Securities. If the remaining
Underwriters or other underwriters satisfactory to the Representative do not
elect to purchase the Immediate Delivery Underwritten Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase, this
Agreement shall terminate without liability on the part of any non-defaulting
Underwriter or the Company, except that the Company will continue to be liable
for the payment of expenses as set forth in Paragraph 7(k) hereof.
Nothing contained in this Paragraph 5 shall relieve a defaulting
Underwriter of any liability it may have to the Company for damages caused by
its default. If other underwriters are obligated or agree to purchase the
Immediate Delivery Underwritten Securities of a defaulting or withdrawing
Underwriter, either the Representative or the Company may postpone the Delivery
Date for up to seven full business days in order to effect any changes that in
the opinion of counsel for the Company or counsel for the Underwriters may be
<PAGE>
7
necessary in the Registration Statement, any Prospectus or in any other document
or arrangement.
6. Delivery of and payment for the Immediate Delivery Underwritten
Securities shall be made at such address, date and time as may be specified in
Schedule I hereto. This date and time are sometimes referred to as the "Delivery
Date". On the Delivery Date the Company shall deliver the Immediate Delivery
Underwritten Securities to The Depository Trust Company, on behalf of the
Representative, for the account of each Underwriter against payment to the
Company by wire transfer of immediately available funds to a bank account
designated by the Company. Time shall be of the essence, and delivery at the
time and place specified pursuant to this Agreement is a further condition of
the obligation of each Underwriter hereunder. Upon delivery, the Immediate
Delivery Underwritten Securities shall be in registered form and in such
denominations as may be set forth on Schedule I hereto. The certificates
representing the Immediate Delivery Underwritten Securities shall be registered
in the name of Cede & Co. and shall be made available for inspection by the
Representative in New York, New York not later than 2:00 P.M., local time, on
the business day prior to the Delivery Date.
7. The Company agrees:
(a) To furnish promptly to the Representative and to counsel for
the Underwriters a conformed copy of the Registration Statement as
originally filed and each amendment or supplement thereto filed prior
to the date hereof or relating to or covering the Underwritten
Securities, and a copy of each Prospectus filed with the Commission,
including all documents incorporated therein by reference and all
consents and exhibits filed therewith;
(b) To deliver promptly to the Representative such reasonable
number of the following documents as the Representative may request:
(i) conformed copies of the Registration Statement (excluding exhibits
other than the computation of the ratio of earnings to fixed charges,
the Indenture and this Agreement), (ii) each Prospectus and (iii) any
documents incorporated by reference in the Prospectus;
(c) During such period following the date hereof as, in the
opinion of counsel for the Underwriters, any Prospectus is required by
law to be delivered, to comply with the Act, the Exchange Act, the
Trust Indenture Act and the rules and regulations under each thereof,
so as to permit the completion of the distribution of the Underwritten
Securities as contemplated in this Agreement and in each Prospectus. If
at any time when a prospectus is required by the Act to be delivered in
connection with sales of the Underwritten Securities, any event shall
occur or condition shall exist as a result of which it is necessary, in
the reasonable opinion of counsel for the Underwriters or for the
Company, to amend the Registration Statement or amend or supplement any
Prospectus in order that such Prospectus will not include any untrue
statements of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in the
light of the circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the opinion of such
<PAGE>
8
counsel, at any such time to amend the Registration Statement or amend
or supplement any Prospectus in order to comply with the requirements
of the Act or the Rules and Regulations, the Company will promptly
prepare and file with the Commission, subject to Paragraph (d) below,
such amendment or supplement as may be necessary to correct such
statement or omission or to make such Registration Statement or any
such Prospectus comply with such requirements, and the Company will
furnish to the Underwriters such number of copies of such amendment or
supplement as the Underwriters may reasonably request.
(d) Prior to filing with the Commission during the period referred
to in (c) above (i) any amendment or supplement to the Registration
Statement, (ii) any Prospectus or any amendment or supplement thereto
or (iii) any document incorporated by reference in any of the foregoing
or any amendment or supplement to such incorporated document, to
furnish a copy thereof to the Representative and to counsel for the
Underwriters and not to file any document that shall have been
disapproved by the Representative;
(e) To advise the Representative promptly (i) when any
post-effective amendment to the Registration Statement relating to or
covering the Underwritten Securities becomes effective or any
supplement to any Prospectus shall have been filed, (ii) of any
comments from the Commission or any request or proposed request by the
Commission for an amendment or supplement to the Registration Statement
(insofar as the amendment or supplement relates to or covers the
Underwritten Securities), to any Prospectus, to any document
incorporated by reference in any of the foregoing or for any additional
information, (iii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or any order
directed to any Prospectus or any document incorporated therein by
reference or the initiation or threat of any stop order proceeding or
of any challenge to the accuracy or adequacy of any document
incorporated by reference in any Prospectus, (iv) of receipt by the
Company of any notification with respect to the suspension of the
qualification of the Underwritten Securities for sale in any
jurisdiction or the initiation or threat of any proceeding for that
purpose and (v) of the happening of any event which makes untrue any
statement of a material fact made in the Registration Statement
(insofar as the Registration Statement relates to or covers the
Underwritten Securities) or any Prospectus or which requires the making
of a change in the Registration Statement or any Prospectus in order to
make any material statement therein not misleading;
(f) If, during the period referred to in (c) above, the Commission
shall issue a stop order suspending the effectiveness of the
Registration Statement, to make every reasonable effort to obtain the
lifting of that order at the earliest possible time;
(g) As soon as practicable, to make generally available to its
security holders and to deliver to the Representative an earnings
statement, conforming with the requirements of Section 11(a) of the
Act, covering a period of at least twelve months beginning after the
latest of (i) the most recent effective date of the registration
statement relating to part of the Underwritten Securities, (ii) the
effective date of the
<PAGE>
9
most recent post-effective amendment to the Registration Statement that
became effective prior to the date of this Agreement and (iii) the date
of the Company's most recent Annual Report on Form 10-K filed with the
Commission prior to the date of this Agreement.
(h) So long as any of the Underwritten Securities are outstanding,
to furnish to the Representative copies of all reports and financial
statements furnished by the Company to each securities exchange on
which securities issued by the Company may be listed pursuant to
requirements of or agreements with such exchange or to the Commission
pursuant to the Exchange Act or any rule or regulation of the
Commission thereunder;
(i) To endeavor to qualify the Underwritten Securities for offer
and sale under the securities laws of such jurisdictions as the
Representative may reasonably request and to maintain such
qualifications in effect for as long as may be required for the
distribution of the Underwritten Securities; provided, however, that
the Company shall not be obligated to file any general consent to
service of process or to qualify as a foreign corporation or as a
dealer in securities in any jurisdiction in which it is not so
qualified or to subject itself to taxation in respect of doing business
in any jurisdiction in which it is not otherwise so subject;
(j) To use its best efforts to obtain the listing of the
Underwritten Securities on the securities exchange, if any, set forth
on Schedule I ("Stock Exchange") on or prior to the Delivery Date and
to cause such listing to be continued so long as any amount of the
Securities remains outstanding; to furnish from time to time any and
all documents, instruments, information and undertakings that may be
necessary in order to effect such listing; and to maintain the same
until none of the Underwritten Securities is outstanding or until such
time as payment of principal of and premium, if any, and interest on
all the Underwritten Securities has been duly provided for, whichever
is earlier; provided that if the Company can no longer reasonably
maintain such listing, the Company shall use its best efforts to obtain
and maintain the quotation for, or listing of, the Underwritten
Securities on such other securities exchange or exchanges as the
Company may, with the approval of the Representative, determine;
(k) To pay the costs incident to the authorization, issuance, sale
and delivery of the Underwritten Securities and any taxes payable in
that connection; the costs incident to the preparation, printing and
filing under the Act of the Registration Statement and any amendments,
supplements and exhibits thereto; the costs incident to the
preparation, printing and filing of any document and any amendments and
exhibits thereto required to be filed by the Company under the Exchange
Act; the costs of distributing the Registration Statement as originally
filed and each amendment and post-effective amendment thereof
(including exhibits), any Preliminary Prospectus, each Prospectus and
any documents incorporated by reference in any of the foregoing
documents; the costs of printing this Agreement and the Delayed
Delivery Contracts, if any; the fees and disbursements of the Company's
counsel, accountants and other
<PAGE>
10
advisors; the fees and expenses of the Trustee, including the fees and
disbursements of counsel for the Trustee in connection with the
Indenture and the Underwritten Securities, to the extent the Trustee or
its counsel, as the case may be, requires reimbursement thereof; the
costs of any filings with the National Association of Securities
Dealers, Inc.; fees paid to rating agencies in connection with the
rating of the Securities, including the Underwritten Securities; the
fees and expenses of qualifying the Underwritten Securities under the
securities laws of the several jurisdictions as provided in this
Paragraph and of preparing and printing a Blue Sky Memorandum
(including fees of counsel to the Underwriters); the cost of listing
the Underwritten Securities on the Stock Exchange; and all other costs
and expenses incident to the performance of the Company's obligations
under this Agreement; provided that, except as provided in this
Paragraph and in Paragraph 11 hereof, the Underwriters shall pay their
own costs and expenses, including the fees and expenses of their
counsel, any transfer taxes on the Underwritten Securities which they
may sell and the expenses of advertising any offering of the
Underwritten Securities made by the Underwriters;
(l) Until the termination of the offering of the Underwritten
Securities, to timely file all documents, and any amendments to
previously filed documents, required to be filed by the Company
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act; and
(m) During the period beginning on the date hereof and continuing
to the Delivery Date, without the consent of the Representative, not to
offer, sell, contract to sell or otherwise dispose of any debt
securities of the Company with maturities longer than one year, other
than the Underwritten Securities to the Underwriters.
8. (a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto) or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out
of any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus or Prospectus (or any amendment
or supplement thereto), or the omission or alleged omission therefrom
of a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
<PAGE>
11
omission, or any such alleged untrue statement or omission; provided
that (subject to Paragraph 8(d) below) any such settlement is effected
with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of outside counsel chosen by the
Representative), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through the Representative expressly for use in the Registration
Statement (or any amendment thereto) or any Preliminary Prospectus or Prospectus
(or any amendment or supplement thereto).
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, its directors, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act against any and all
loss, liability, claim, damage and expense described in the indemnity contained
in subsection (a) of this Paragraph 8, as incurred, but only with respect to
untrue statements or omissions, or alleged untrue statements or omissions, made
in the Registration Statement (or any amendment thereto) or any Preliminary
Prospectus or Prospectus (or any amendment or supplement thereto) in reliance
upon and in conformity with written information furnished to the Company by such
Underwriter through the Representative expressly for use in the Registration
Statement (or any amendment thereto) or such Preliminary Prospectus or
Prospectus (or any amendment or supplement thereto).
(c) Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
hereunder to the extent it is not materially prejudiced as a result thereof and
in any event shall not relieve it from any liability which it may have otherwise
than on account of this indemnity agreement. In the case of parties indemnified
pursuant to Paragraph 8(a) above, counsel to the indemnified parties shall be
selected by the Representative, and, in the case of parties indemnified pursuant
to Paragraph 8(b) above, counsel to the indemnified parties shall be selected by
the Company. An indemnifying party may participate at its own expense in the
defense of any such action; provided, however, that counsel to the indemnifying
party shall not (except with the consent of the indemnified party) also be
counsel to the indemnified party. In no event shall the indemnifying parties be
liable for fees and expenses of more than one counsel (in addition to any local
counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general
<PAGE>
12
allegations or circumstances. No indemnifying party shall, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any litigation, or any investigation
or proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever in respect of which indemnification or contribution could
be sought under this Paragraph 8 (whether or not the indemnified parties are
actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.
(d) If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 6(a)(ii) effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
(e) If the indemnification provided for in this Paragraph 8 is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand and the
Underwriters on the other hand from the offering of the Underwritten Securities
pursuant to this Agreement or (ii) if the allocation provided by clause (i) is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company on the one hand and of the Underwriters on the
other hand in connection with the statements or omissions which resulted in such
losses, liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company on the one hand and the
Underwriters on the other hand in connection with the offering of the
Underwritten Securities pursuant to this Agreement shall be deemed to be in the
same respective proportions as the total net proceeds from the offering of the
Underwritten Securities pursuant to this Agreement (before deducting expenses)
received by the Company and the total underwriting discount received by the
Underwriters, bear to the aggregate initial offering price of the Underwritten
Securities.
The relative fault of the Company on the one hand and the Underwriters
on the other hand shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
<PAGE>
13
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Paragraph 8(e) were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Paragraph 8(e). The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Paragraph 8(e) shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Paragraph 8(e), no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Underwritten Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
any such untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation.
For purposes of this Paragraph 8(e), each person, if any, who controls
an Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act shall
have the same rights to contribution as the Company. The Underwriters'
respective obligations to contribute pursuant to this Paragraph 8(e) are several
in proportion to the principal amount of Underwritten Securities set forth
opposite their respective names in Schedule II hereto and not joint.
(f) The indemnity agreements contained in this Paragraph and the
representations, warranties and agreements of the Company in Paragraph 1 and
Paragraph 7 hereof shall survive the delivery of the Underwritten Securities and
shall remain in full force and effect, regardless of any termination or
cancellation of this Agreement or any investigation made by or on behalf of any
indemnified party.
9. (a) The Representative may terminate this Agreement, by notice to
the Company, at any time at or prior to the delivery of and payment for the
Immediate Delivery Underwritten Securities, (i) if there has been, since the
time of execution of this Agreement or since the respective dates as of which
information is given in the Prospectus, any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company or the Company and its subsidiaries taken as a
whole, whether or not arising in the ordinary course of business, the effect of
which is such as to
<PAGE>
14
make it, in the judgment of the Representative, impracticable to market the
Underwritten Securities or to enforce contracts for the sale of the Underwritten
Securities, or (ii) if there has occurred any material adverse change in the
financial markets in the United States, any outbreak of hostilities or
escalation thereof or other calamity or crisis or any change or development
involving a prospective change in national or international political, financial
or economic conditions, in each case the effect of which is such as to make it,
in the judgment of the Representative, impracticable to market the Underwritten
Securities or to enforce contracts for the sale of the Underwritten Securities,
or (iii) if trading in any securities of the Company or Bell Atlantic
Corporation has been suspended or materially limited by the Commission, or if
trading generally on the American Stock Exchange or the New York Stock Exchange
or in the Nasdaq National Market has been suspended or materially limited, or
minimum or maximum prices for trading have been fixed, or maximum ranges for
prices have been required, by any of said exchanges or by such system or by
order of the Commission, the National Association of Securities Dealers, Inc. or
any other governmental authority, or (iv) if a banking moratorium has been
declared by either Federal or New York authorities.
(b) If this Agreement is terminated pursuant to this Paragraph 9, such
termination shall be without liability of any party to any other party except as
provided in Paragraph 11 hereof, and provided further that Paragraphs 1 and 8
shall survive such termination and remain in full force and effect.
10. The respective obligations of the Underwriters under the Agreement
with respect to the Underwritten Securities are subject to the accuracy, on the
date hereof and on the Delivery Date, of the representations and warranties of
the Company contained herein, to performance by the Company of its obligations
hereunder, and to each of the following additional terms and conditions
applicable to the Underwritten Securities.
(a) At or before the Delivery Date, no stop order suspending the
effectiveness of the Registration Statement nor any order directed to
any document incorporated by reference in any Prospectus shall have
been issued and prior to that time no stop order proceeding shall have
been initiated or threatened by the Commission and no challenge shall
have been made to the accuracy or adequacy of any document incorporated
by reference in any Prospectus; any request of the Commission for
inclusion of additional information in the Registration Statement or
any Prospectus or otherwise shall have been complied with; and after
the date hereof the Company shall not have filed with the Commission
any amendment or supplement to the Registration Statement or any
Prospectus (or any document incorporated by reference therein) that
shall have been disapproved by the Representative.
(b) No Underwriter shall have discovered and disclosed to the
Company on or prior to the Delivery Date that the Registration
Statement or any Prospectus contains an untrue statement of a fact
which, in the opinion of counsel for the Underwriters, is material or
omits to state a fact which, in the opinion of such counsel, is
material and is required to be stated therein or is necessary to make
the statements therein not misleading.
<PAGE>
15
(c) All corporate proceedings and other legal matters incident to
the authorization, form and validity of this Agreement, the
Underwritten Securities and the Indenture and the form of the
Registration Statement, each Prospectus (other than financial
statements and other financial data) and all other legal matters
relating to this Agreement and the transactions contemplated hereby
shall be satisfactory in all respects to Simpson Thacher & Bartlett,
counsel for the Underwriters, and the Company shall have furnished to
such counsel all documents and information that such counsel may
reasonably request to enable it to pass upon such matters.
(d) The General Counsel of the Company shall have furnished to the
Representative his opinion addressed to the Underwriters and dated the
Delivery Date, as General Counsel of the Company, to the effect that:
(i) The Company has been duly incorporated and is validly
existing and in good standing under the laws of the State of New
York;
(ii) The Company is duly qualified to do business and is in
good standing as a foreign corporation in all jurisdictions in
which its ownership of property or the conduct of its business
requires such qualification (except where the failure to so
qualify would not have a Material Adverse Effect), and has all
power and authority necessary to own its properties and conduct
the business in which it is engaged as described in the
Prospectus;
(iii) The Indenture has been duly authorized, executed and
delivered by the Company and duly qualified under the Trust
Indenture Act and, assuming due authentication, execution and
delivery by the Trustee, constitutes a valid and legally binding
instrument of the Company enforceable in accordance with its
terms;
(iv) The Immediate Delivery Underwritten Securities have been
duly authorized, executed and issued by the Company and, assuming
due authentication thereof by the Trustee and upon payment and
delivery in accordance with this Agreement, will constitute valid
and legally binding obligations of the Company enforceable in
accordance with their terms and entitled to the benefits of the
Indenture;
(v) The Delayed Delivery Underwritten Securities, if any, have
been duly authorized and, when duly executed and issued by the
Company and, assuming due authentication thereof by the Trustee
and upon payment and delivery by the respective purchasers thereof
in accordance with the terms of the related Delayed Delivery
Contracts, will constitute valid and legally binding obligations
of the Company, enforceable in accordance with their terms and
entitled to the benefits of the Indenture;
<PAGE>
16
(vi) The Delayed Delivery Contracts, if any, have been duly
authorized, executed and delivered by the Company and, assuming
due authorization, execution and delivery by the purchasers
thereunder, are valid and legally binding obligations of the
parties thereto;
(vii) The statements made in each Prospectus under the caption
"Description of Securities" (or a comparable caption), insofar as
they purport to constitute summaries of the documents referred to
therein, constitute accurate summaries of the terms of such
documents in all material respects;
(viii) The Registration Statement is effective under the Act
and, to the knowledge of such counsel, no stop order suspending
its effectiveness has been issued and no proceeding for that
purpose is pending or threatened by the Commission;
(ix) No order issued by the Commission directed to any
document incorporated by reference in any Prospectus has been
issued and, to the knowledge of such counsel, no challenge has
been made by the Commission to the accuracy or adequacy of any
such document;
(x) Such counsel does not know of any litigation or any
governmental proceeding pending or threatened against the Company
which would affect the subject matter of this Agreement or is
required to be disclosed in any Prospectus (including the
documents incorporated by reference therein) which is not
disclosed and correctly summarized therein;
(xi) To the best of such counsel's knowledge, the Company is
not in violation of its corporate charter or by-laws, or in
default under any material agreement, indenture or instrument;
(xii) This Agreement has been duly authorized, executed and
delivered by the Company;
(xiii) The execution, delivery and performance of this
Agreement and the Delayed Delivery Contracts, if any, and
compliance by the Company with the provisions of the Underwritten
Securities and the Indenture will not conflict with, or result in
the creation or imposition of any lien, charge or encumbrance upon
any of the assets of the Company pursuant to the terms of, or
constitute a default under, any agreement, indenture or instrument
known to such counsel, or result in a violation of the corporate
charter or by-laws of the Company or, to the best of such
counsel's knowledge, any order, rule or regulation of any court or
governmental agency having jurisdiction over the Company or its
property;
<PAGE>
17
(xiv) All legally required proceedings in connection with the
authorization, issue and validity of the Underwritten Securities
and the sale of the Underwritten Securities by the Company in
accordance with this Agreement have been taken, and all legally
required orders, consents or other authorizations or approvals of
the PSC and of any other public boards or bodies have been
obtained; and
(xv) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined
in the 1940 Act.
In giving such opinion, such counsel may rely on the opinion of
Connecticut counsel satisfactory to counsel for the Underwriters as to matters
of Connecticut law. In giving such opinion, such counsel need not express any
opinion regarding any order, consent or other authorization or approval which
may be legally required pursuant to any state securities law.
Such counsel may state that the opinions set forth in paragraphs (iii),
(iv), (v) and (vi) above are subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
Such opinion shall also state that the Registration Statement and each
Prospectus as of their respective effective and issue dates complied as to form
in all material respects with the requirements of the Act and the Trust
Indenture Act and the rules and regulations of the Commission under said Acts
(except that no opinion need be expressed as to the financial statements and
other financial data contained herein) and each document incorporated by
reference in each Prospectus as filed under the Exchange Act complied when so
filed as to form in all material respects with the applicable requirements of
the Exchange Act and the rules and regulations of the Commission thereunder
(except that no opinion need be expressed as to the financial statements and
other financial data contained therein).
Such opinion shall also contain a statement that such counsel has no
reason to believe that (i) the Registration Statement, on the date it became
effective (or, with respect to the Registration Statement, if the Company has
filed an Annual Report on Form 10-K since its effective date, the date of the
Company's most recent Annual Report on Form 10-K), contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary in order to make the statements therein not misleading, or
(ii) the Prospectus, as of its date and as of the Delivery Date, contains an
untrue statement of a material fact or omits to state a material fact necessary
in order to make the statements therein, in light of the circumstances under
which they were made, not misleading.
(e) At the Delivery Date, there shall not have been, since the date
hereof or since the respective dates as of which information is given in the
Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company or the Company and its subsidiaries taken as a whole, whether or
<PAGE>
18
not arising in the ordinary course of business, and the Representative shall
have received a certificate of the Chairman of the Board, the President, the
Chief Financial Officer or a Vice President of the Company, and the Treasurer or
an Assistant Treasurer of the Company, dated the Delivery Date, to the effect
that (i) there has been no such material adverse change, (ii) the
representations and warranties in Paragraph 1 hereof are true and correct with
the same force and effect as though expressly made at and as of the Delivery
Date, (iii) the Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to the Delivery
Date, and (iv) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are pending or are contemplated by the Commission.
(f) If Underwritten Securities in bearer form are being delivered by
the Company on the Delivery Date in a jurisdiction other than the United States,
the Company shall have furnished to the Representative such legal opinion or
opinions as the Representative may reasonably request addressed to the
Underwriters and dated the Delivery Date, with respect to matters relating to
the offering, sale and delivery of the Underwritten Securities in such
jurisdiction.
(g) The Company shall have furnished to the Representative (i) a letter
of Coopers & Lybrand, addressed to the Underwriters and dated the date hereof of
the type described in the American Institute of Certified Public Accountants'
Statement on Auditing Standards No. 72 and covering such specified financial
statement items as counsel for the Underwriters may reasonably have requested
and (ii) a letter of Coopers & Lybrand, addressed to the Underwriters and dated
the Delivery Date, stating, as of the date of such letter (or, with respect to
matters involving changes or developments since the respective dates as of which
specified financial information is given in the Prospectus, as of a date not
more than five days prior to the date of such letter), the conclusions and
findings of such firm with respect to the financial information and other
matters covered by its letter referred to in subclause (i) above, confirming in
all material respects the conclusions and findings set forth in such prior
letter.
(h) Simpson Thacher & Bartlett shall have furnished to the
Representative its opinion addressed to the Underwriters and dated the Delivery
Date, as counsel for the Underwriters, covering the matters set forth in
Paragraph 10(d), except clauses (ii), (viii), (ix), (x), (xi) and (xiii)
thereof.
(i) The PSC shall have granted authorization, and on the Delivery Date
such authorization shall be in full force and effect, permitting the issuance
and sale of the Underwritten Securities upon the terms and conditions hereunder
set forth or contemplated and containing no provision unacceptable to the
Underwriters, and, if required, the Company shall have been advised by the
Director of the Office of Accounting and Finance of the PSC or his designee that
such authority is not to be abrogated.
(j) The Underwritten Securities shall have been accepted for listing on
the Stock Exchange (if any), subject to official notice of issuance.
<PAGE>
19
(k) At the Delivery Date, the Underwritten Securities shall be rated at
least "___" by Moody's Investor's Service Inc., "__" by Standard & Poor's
Ratings Group, a division of McGraw-Hill, Inc., and "__" by Duff & Phelps Credit
Rating Co., and the Company shall have delivered to the Representative a letter
dated the Delivery Date, from each such rating agency, or other evidence
satisfactory to the Representative, confirming that the Underwritten Securities
have such ratings; and since the date of this Agreement, there shall not have
occurred a downgrading in the rating assigned to the Underwritten Securities or
any of the Company's other debt securities by any such rating agency, and no
such rating agency shall have publicly announced that it has withdrawn or has
put under surveillance or review with negative implications, including putting
on what is commonly termed a "watch list," its rating of the Underwritten
Securities or any of the Company's other debt securities.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance satisfactory to counsel
for the Underwriters.
11. If the Company shall fail to tender the Immediate Delivery
Underwritten Securities for delivery to the Underwriters for any reason
permitted under this Agreement, or if the Underwriters shall decline to purchase
the Immediate Delivery Underwritten Securities for any reason permitted under
this Agreement (other than pursuant to Paragraph 5 hereof). the Company shall
reimburse the Underwriters for reasonable fees and expenses of their counsel and
for such other out-of-pocket expenses as shall have been incurred by them in
connection with this Agreement and the proposed purchase of Immediate Delivery
Underwritten Securities and the solicitation of any purchases of the Delayed
Delivery Underwritten Securities, and upon demand the Company shall pay the full
amount thereof to the Representative. If this Agreement is terminated pursuant
to Paragraph 5 hereof by reason of the default of one or more Underwriters, the
Company shall not be obligated to reimburse any defaulting Underwriter on
account of those expenses.
12. The Company shall be entitled to act and rely upon any request,
consent, notice or agreement by, or on behalf of, the Representative. Any notice
by the Company to the Underwriters shall be sufficient if given in writing or by
telegraph addressed to the Representative at its address set forth in Schedule I
hereto, and any notice by the Underwriters to the Company shall be sufficient if
given in writing or by telegraph addressed to the Company at 1095 Avenue of the
Americas, New York, New York 10036, Attention of the Treasurer.
13. This Agreement shall be binding upon the Underwriters, the Company,
and their respective successors. This Agreement and the terms and provisions
hereof are for the sole benefit of only those persons, except that (a) the
representations, warranties, indemnities and agreements of the Company contained
in this Agreement shall also be deemed to be for the benefit of the person or
persons, if any, who control any Underwriter within the meaning of Section 15 of
the Act, and (b) the indemnity agreement of the Underwriters contained in
Paragraph 8 hereof shall be deemed to be for the benefit of directors of the
Company, officers of the Company who have signed the Registration Statement and
any person controlling the Company. Nothing in this Agreement is intended or
shall be construed to give any person,
<PAGE>
20
other than the persons referred to in this Paragraph, any legal or equitable
right, remedy or claim under or in respect of this Agreement or any provision
contained herein.
14. For purposes of this Agreement, (a) "business day" means any day on
which the New York Stock Exchange, Inc. is open for trading and (b) "subsidiary"
has the meaning set forth in Rule 405 of the Rules and Regulations.
15. This Agreement shall be governed by and construed in accordance
with the laws of New York.
<PAGE>
21
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this Agreement shall represent a binding agreement among the Company and the
several Underwriters.
Very truly yours,
NEW YORK TELEPHONE COMPANY
By
-----------------------
Name:
Title:
The foregoing Agreement is hereby confirmed
and accepted as of the date first
above written.
- -------------------------------------------
By
-----------------------------------------
Name:
Title:
For itself and as Representative of the other Underwriters named in Schedule II
to the foregoing Agreement.
<PAGE>
SCHEDULE I
Underwriting Agreement dated ____________, 1998.
Registration Statement No. __________.
Representatives and Addresses:
Underwritten Securities
Designation:
Principal amount:
Indenture: Indenture dated as of ____________, 1998
from New York Telephone Company, to
_________________________, as Trustee.
Date of Maturity:
Interest Rate:
Purchase Price:
Redemption Provisions:
Authorized Denominations:
Stock Exchange Listing:
Delivery Date, Time and Location:
<PAGE>
SCHEDULE II
Principal
Amount of
Underwritten
Securities
----------------------------
Name of Underwriter
- ----------------------------------------------------
----------
Total $
==========
<PAGE>
EXHIBIT A
$
NEW YORK TELEPHONE COMPANY
DEBT SECURITIES
DELAYED DELIVERY CONTRACT
[DATE]
NEW YORK TELEPHONE COMPANY
1095 Avenue of Americas
New York, New York 10036
Dear Sirs:
The undersigned hereby agrees to purchase from New York Telephone Company,
a New York corporation ("Company"), and the Company hereby agrees to sell to the
undersigned,
$
principal amount of the Company's above-captioned securities ("Securities"),
offered by the Company's prospectus dated , 199 , as supplemented by the
prospectus supplement dated , 199 (collectively, the "Prospectus"), receipt
of a copy of which is hereby acknowledged, at a purchase price of % of the
principal amount thereof plus accrued interest from , 199 to the Delivery
Date (as defined in the next paragraph) and on the further terms and conditions
set forth in this Contract.
Payment for and delivery of the Securities to be purchased by the
undersigned shall be made on , 199 , herein called the "Delivery Date".
At 10:00 A.M., New York time, on the Delivery Date, the Securities to be
purchased by the undersigned hereunder will be delivered by the Company to the
undersigned, and the undersigned will accept delivery of such Securities and
will make payment to the Company of the purchase price therefor, at the office
of . Payment will be certified or official bank check payable in next-day
funds settled through the New York Clearing House to or upon the order of the
Company.
This Contract will terminate and be of no further force and effect after
, 199 , unless (i) on or before such date it shall have been executed and
delivered by both parties hereto or (ii) the Company shall have sold to the
Underwriters named in the Prospectus the Immediate Delivery Underwritten
Securities (as defined in the Underwriting Agreement referred to in the
Prospectus) and the Company shall have mailed or delivered to the undersigned at
its address set forth below a notice to that effect, stating the date of the
<PAGE>
3
occurrence thereof, accompanied by copies of the opinion of counsel for the
Company delivered to such Underwriters pursuant to Paragraph 10(d) of the
Underwriting Agreement.
The obligation of the undersigned to accept delivery and make payment for
the Securities on the Delivery Date will be subject to the condition that the
Securities shall not, on the Delivery Date, be an investment prohibited by the
laws of the jurisdiction to which the undersigned is subject, the undersigned
hereby representing that such an investment is not so prohibited on the date
hereof. This Contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors but will not be assignable by
either party hereto without the written consent of the other.
It is understood that acceptance of any Delayed Delivery Contract (as
defined in said Underwriting Agreement) is in the Company's sole discretion and,
without limiting the foregoing, need not be on a first-come, first-served basis.
If this Contract is acceptable to the Company, it is requested that the Company
sign the form of acceptance below and mail or deliver one of the counterparts
hereof to the undersigned at its address set forth below. This will become a
binding contract between the Company and the undersigned when such counterpart
is so mailed or delivered.
Very truly yours,
By
-------------------------------
-------------------------------
Title
-------------------------------
Address
Accepted as of , 19 .
NEW YORK TELEPHONE COMPANY
By
------------------------
Title
================================================================================
NEW YORK TELEPHONE COMPANY
to
THE CHASE MANHATTAN BANK
Trustee
-----------------
Indenture
Dated as of February 1, 1998
-----------------
Providing for Issuance of
Securities in Series
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions................................................... 1
SECTION 1.02. Other Definitions............................................. 4
SECTION 1.03. Incorporation by Reference of Trust Indenture Act............. 4
SECTION 1.04. Rules of Construction......................................... 5
ARTICLE 2
THE SECURITIES
SECTION 2.01. Issuable in Series............................................ 5
SECTION 2.02. Establishment of Terms and Form of Securities................. 6
SECTION 2.03. Execution, Authentication and Delivery........................ 8
SECTION 2.04. Registrar and Paying Agent.................................... 10
SECTION 2.05. Payment on Securities......................................... 11
SECTION 2.06. Paying Agent to Hold Money in Trust........................... 12
SECTION 2.07. Securityholder Lists; Ownership of Securities................. 12
SECTION 2.08. Temporary Securities and Exchange of Securities............... 13
SECTION 2.09. Replacement Securities........................................ 16
SECTION 2.10. Outstanding Securities........................................ 17
SECTION 2.11. Treasury Securities........................................... 17
SECTION 2.12. Registration, Registration of Transfer and Exchange........... 17
SECTION 2.13. Cancellation.................................................. 20
SECTION 2.14. Calculation of Interest; Defaulted Interest................... 21
ARTICLE 3
REDEMPTION
SECTION 3.01. Notice to Trustee............................................. 21
SECTION 3.02. Selection of Securities to be Redeemed........................ 21
SECTION 3.03. Notice of Redemption.......................................... 22
SECTION 3.04. Effect of Notice of Redemption................................ 23
SECTION 3.05. Deposit of Redemption Price................................... 23
SECTION 3.06. Securities Redeemed in Part................................... 23
- i -
<PAGE>
Page
ARTICLE 4
COVENANTS
SECTION 4.01. Payment of Securities......................................... 23
SECTION 4.02. No Additional Bonds Under Refunding Mortgage.................. 24
SECTION 4.03. Earnings Coverage for Interest Charges........................ 24
SECTION 4.04. Lien on Assets................................................ 24
SECTION 4.05. Reports by the Company........................................ 25
ARTICLE 5
SUCCESSOR CORPORATION
SECTION 5.01. When Company May Merge, etc................................... 26
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default............................................. 26
SECTION 6.02. Acceleration.................................................. 27
SECTION 6.03. Other Remedies Available to Trustee........................... 27
SECTION 6.04. Waiver of Existing Defaults................................... 28
SECTION 6.05. Control by Majority........................................... 28
SECTION 6.06. Limitation on Suits by Securityholders........................ 28
SECTION 6.07. Rights of Holders to Receive Payment.......................... 29
SECTION 6.08. Collection Suits by Trustee................................... 29
SECTION 6.09. Trustee May File Proofs of Claim.............................. 29
SECTION 6.10. Priorities.................................................... 29
SECTION 6.11. Undertaking for Costs......................................... 29
ARTICLE 7
TRUSTEE
SECTION 7.01. Duties of Trustee............................................. 30
SECTION 7.02. Rights of Trustee............................................. 31
SECTION 7.03. Individual Rights of Trustee.................................. 31
SECTION 7.04. Trustee's Disclaimer.......................................... 31
SECTION 7.05. Notice of Defaults............................................ 31
SECTION 7.06. Reports by Trustee to Holders................................. 32
SECTION 7.07. Compensation and Indemnity.................................... 32
SECTION 7.08. Replacement of Trustee........................................ 33
SECTION 7.09. Successor Trustee, Agents by Merger, etc. ................... 34
SECTION 7.10. Eligibility; Disqualification................................. 34
SECTION 7.11. Preferential Collection of Claims Against Company............. 34
SECTION 7.12. Rights of Trustee in Capacity of Registrar or Paying Agent.... 35
- ii -
<PAGE>
Page
ARTICLE 8
DISCHARGE OF INDENTURE
SECTION 8.01. Termination of Company's Obligations.......................... 35
SECTION 8.02. Application of Trust Money.................................... 36
SECTION 8.03. Repayment to Company.......................................... 36
SECTION 8.04. Indemnity for Government Obligations.......................... 36
ARTICLE 9
AMENDMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.................................... 36
SECTION 9.02. With Consent of Holders....................................... 37
SECTION 9.03. Compliance with Trust Indenture Act........................... 38
SECTION 9.04. Revocation and Effect of Consents............................. 38
SECTION 9.05. Notation on or Exchange of Securities......................... 38
SECTION 9.06. Trustee Protected............................................. 38
ARTICLE 10
MISCELLANEOUS
SECTION 10.01. Trust Indenture Act Controls................................. 38
SECTION 10.02. Notices...................................................... 38
SECTION 10.03. Communication by Holders with Other Holders.................. 39
SECTION 10.04. Certificate and Opinion as to Conditions Precedent........... 40
SECTION 10.05. Statements Required in Certificate or Opinion................ 40
SECTION 10.06. Rules by Trustee and Agents.................................. 40
SECTION 10.07. Legal Holidays............................................... 40
SECTION 10.08. Governing Law................................................ 41
SECTION 10.09. No Adverse Interpretation of Other Agreements................ 41
SECTION 10.10. No Recourse Against Others................................... 41
SECTION 10.11. Execution in Counterparts.................................... 42
- iii -
<PAGE>
EXHIBIT A Form of Certificate to be Given By Person Entitled to Receive
Unregistered Security
EXHIBIT B Form of Certificate to be Given By Euro-clear or CEDEL
- iv -
<PAGE>
Reconciliation and tie between Indenture dated as of February 1, 1998 and the
Trust Indenture Act of 1939. This reconciliation section does not constitute
part of the Indenture.
Trust Indenture Act Indenture
of 1939 Section Section
310(a).....................................................................7.10
(b).............................................................7.08; 7.10
(c)...........................................................Inapplicable
311(a).....................................................................7.11
(b)...................................................................7.11
(c)...........................................................Inapplicable
312(a).....................................................................2.07
(b)..................................................................10.03
(c)..................................................................10.03
313(a).....................................................................7.06
(b)(1)........................................................Inapplicable
(b)(2)................................................................7.06
(c)...................................................................7.06
(d)...................................................................7.06
314(a)..............................................................4.05; 10.02
(b)...........................................................Inapplicable
(c)(1)...............................................................10.04
(c)(2)...............................................................10.04
(c)(3)........................................................Inapplicable
(d)...........................................................Inapplicable
(e)..................................................................10.05
(f)...........................................................Inapplicable
315(a)..................................................................7.01(b)
(b)............................................................7.05; 10.02
(c)................................................................7.01(a)
(d)................................................................7.01(c)
(e)...................................................................6.11
316(a)(last sentence)......................................................2.10
(a)(1)(A).............................................................6.05
(a)(1)(B).............................................................6.04
(a)(2)........................................................Inapplicable
(b)...................................................................6.07
317(a)(1)..................................................................6.08
(a)(2)................................................................6.09
(b)...................................................................2.06
318(a)....................................................................10.01
<PAGE>
INDENTURE dated as of February 1, 1998, from NEW YORK TELEPHONE
COMPANY, a New York corporation ("Company"), to THE CHASE MANHATTAN BANK, a New
York banking corporation ("Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness ("Securities") as herein
provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed as
follows for the equal and ratable benefit of the Holders of the Securities:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Affiliate" means any person directly or indirectly controlling or
controlled by, or under direct or indirect common control with, the Company.
"Agent" means any Paying Agent or Registrar.
"Authorized Newspaper" means a newspaper of general circulation, in
the official language of the country of publication or in the English language,
customarily published on each business day. Whenever successive weekly
publications in an Authorized Newspaper are required hereunder they may be made
(unless otherwise expressly provided herein) on the same or different days of
the week and in the same or different Authorized Newspapers.
"Board of Directors" means the Board of Directors of the Company or
any duly authorized committee thereof.
"Board Resolution" means a copy of a resolution of the Board of
Directors, certified by the Secretary or an Assistant Secretary of the Company
to have been adopted by the Board of Directors and to be in full force and
effect on the date of the certificate, and delivered to the Trustee.
"CEDEL, S.A." means Centrale de Livraison de Valeurs Mobilieres,
S.A.
<PAGE>
2
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means the party named as such in this Indenture until a
successor replaces it and thereafter means the successor.
"Company Order" means an order signed by two Officers or by any
Officer and an Assistant Treasurer or an Assistant Secretary of the Company.
"Default" means any event which is, or after notice or passage of
time would be, an Event of Default.
"Depositary" means, with respect to the Securities of a Series
issuable or issued in the form of a global Security, the person designated as
Depositary by the Company pursuant to Section 2.02 until a successor Depositary
shall have become such pursuant to this Indenture, and thereafter "Depositary"
shall mean or include each person who is then a Depositary hereunder, and if at
any time there is more than one such person, "Depositary" as used with respect
to the Securities of any such Series shall mean the Depositary with respect to
the Securities of that Series.
"Euro-clear" means Morgan Guaranty Trust Company of New York,
Brussels office, or its successor, as operator of the Euro-clear System.
"Holder" or "Securityholder" means a bearer of an Unregistered
Security or of a coupon appertaining thereto or a person in whose name a
Registered Security is registered on the Registrar's books.
"Indenture" means this Indenture as amended or supplemented from
time to time and shall include the forms and terms of particular Series of
Securities or Securities of a Series established as contemplated hereunder.
"Officer" means the Chairman of the Board of Directors, any
Vice-Chairman of the Board of Directors, the President, any Vice-President, the
Treasurer, the Secretary or the Comptroller of the Company.
"Officers' Certificate" means a certificate signed by two Officers
or by any Officer and an Assistant Treasurer or an Assistant Secretary of the
Company.
"Opinion of Counsel" means a written opinion of legal counsel. The
counsel may be an employee of or counsel to the Company or the Trustee.
"Original Issue Discount Security" means any Security which provides
for an amount less than the stated principal amount thereof to be due and
payable upon declaration of acceleration of the maturity thereof pursuant to
Section 6.02.
"Principal" of a debt security means the principal of the security
plus, when appropriate, the premium, if any, on the security.
<PAGE>
3
"Refunding Mortgage" means the Refunding Mortgage dated October 1,
1921 between the Company and Bankers Trust Company, as Trustee, as supplemented
by 24 supplemental indentures confirming the lien thereof with respect to which
the Company represents there are outstanding on the date hereof $985,000,000 in
principal amount of Refunding Mortgage Bonds, Series M through R, inclusive, T
and V.
"Registered Security" means any Security issued hereunder and
registered as to principal and interest by the Registrar.
"Responsible Officer", when used with respect to the Trustee, shall
mean any trust officer, any second or assistant vice-president or any other
officer or assistant officer of the Trustee customarily performing functions
similar to those performed by the persons who at the time shall be such
officers, respectively, or to whom any corporate trust matter is referred
because of his knowledge of and familiarity with a particular subject.
"Restricted Period" has the meaning set forth in United States
Treasury Regulation Section 1.163-5(c)(2)(i)(D)(7).
"SEC" means the Securities and Exchange Commission.
"Series" or "Series of Securities" means a series of Securities.
"Securities" means the debentures, notes or other obligations of the
Company issued, authenticated and delivered under this Indenture.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss.
77aaa-77bbbb) as in effect on the date of this Indenture.
"Trustee" means the party named as such in this Indenture until a
successor replaces it and thereafter means the successor and if, at any time,
there is more than one Trustee, "Trustee" as used with respect to the Securities
of any Series shall mean the Trustee with respect to that Series.
"U.S. person" means a citizen, national or resident of the United
States, a corporation, partnership or other entity created or organized in or
under the laws of the United States or any political subdivision thereof, an
estate whose income from sources without the United States is includable in
gross income for United States federal income tax purposes regardless of its
source or a trust if a court within the United States is able to exercise
primary supervision over the administration of such trust and one or more U.S.
persons as described in Section 7701(a)(30) of the Code have the authority to
control all of the substantial decisions of such trust.
"United States" means the United States of America (including the
States and District of Columbia) and its possessions (including Puerto Rico and
the U.S. Virgin Islands, Guam, American Samoa, Wake Island and Northern Mariana
Islands).
<PAGE>
4
"Unregistered Security" means any Security issued hereunder which is
not a Registered Security.
"Yield to Maturity" means the yield to maturity, calculated by the
Company at the time of issuance of a Series of Securities or a Security of a
Series or, if applicable, at the most recent determination of interest on such
Series or such Security in accordance with accepted financial practice.
SECTION 1.02. Other Definitions.
Term Section
"Bankruptcy Law"......................................................... 6.01
"Custodian".............................................................. 6.01
"Event of Default"....................................................... 6.01
"Exchange Date".......................................................... 2.08
"Global Exchange Agent".................................................. 2.08
"Legal Holiday".......................................................... 10.07
"Paying Agent"........................................................... 2.04
"Registrar".............................................................. 2.04
"U.S. Government Obligations"............................................ 8.01
SECTION 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Holder or a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings assigned to them therein.
<PAGE>
5
SECTION 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles;
(3) "or" is not exclusive; and
(4) words in the singular include the plural, and words in the
plural include the singular.
ARTICLE 2
THE SECURITIES
SECTION 2.01. Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities may be issued in one or more Series. There may be
Registered Securities and Unregistered Securities within a Series. The
Securities may be subject to such restrictions, and contain such legends, as may
be required by United States laws and regulations.
If any Security of a Series is issuable in global form, such
Security may provide that it shall represent the aggregate amount of outstanding
Securities from time to time endorsed thereon and may also provide that the
aggregate amount of outstanding Securities represented thereby may from time to
time be reduced to reflect exchanges. Any endorsement of a Security in global
form to reflect the amount, or any increase or decrease in the amount, of
outstanding Securities represented thereby shall be made in such manner and by
such person or persons as shall be specified therein. Any instructions to the
Trustee by the Company with respect to a Security in global form, after its
initial issuance, shall be in writing but need not comply with Section 10.04 or
10.05, except as may otherwise be required by the TIA.
Global Securities may be issued as either Registered Securities or
Unregistered Securities and in either temporary or permanent form.
All Securities of any one Series shall be substantially identical
except the terms of such Securities may differ with respect to authorized
denomination, date of issuance, interest rate and manner of calculation thereof,
the date from which interest, if any, shall accrue, interest payment dates or
manner of determining the same, record dates, maturity date or manner of
determining the same, redemption provisions and other terms authorized to be
established
<PAGE>
6
pursuant to Section 2.02, which terms, as set forth in Section 2.02, may be
determined by the Company from time to time as to Securities of a Series if so
provided in or established pursuant to the authority granted in a Board
Resolution or by an indenture supplemental hereto, and except as may otherwise
be provided in or pursuant to such Board Resolution and, if such Board
Resolution authorizes a specific Officer or Officers to approve the terms of the
Securities of a Series, a certificate of such Officer or Officers or in any such
indenture supplemental hereto. All Securities of any one Series need not be
issued at the same time, and unless otherwise provided, a Series may be reopened
for issuance of additional Securities of such Series.
Securities of different Series may differ in any respect; provided
that all Series of Securities shall be equally and ratably entitled to the
benefits of this Indenture.
SECTION 2.02. Establishment of Terms and Form of Securities.
(a) At or prior to the issuance of Securities of any Series, the
following shall be established either by or pursuant to a Board Resolution or by
an indenture supplemental hereto:
(1) the title of the Securities of the Series (which title
shall distinguish the Securities of the Series from the Securities of any
other Series and from any other securities issued by the Company);
(2) any limit upon the aggregate principal amount of the
Securities of the Series which may be authenticated and delivered under
this Indenture (which limit shall not pertain to Securities authenticated
and delivered upon registration of transfer of, or in exchange for, or in
lieu of, other Securities of the Series pursuant to Section 2.08, 2.09,
2.12, 3.06 or 9.05);
(3) the date or dates or manner of determining the same on
which principal of the Securities of the Series is payable (which, if so
provided in such Board Resolution or supplemental indenture, may be
determined by the Company from time to time and set forth in the
Securities of the Series from time to time);
(4) the rate or rates at which the Securities of the Series
shall bear interest, if any, or (if other than as specified in Section
2.14(a)) the manner of calculating such rate or rates of interest, the
date or dates from which such interest shall accrue, the dates on which
such interest shall be payable or the manner of determining the same and,
with respect to Registered Securities, the record date for the interest
payable on any interest payment date (which in any case, if so provided in
such Board Resolution or supplemental indenture, may be determined by the
Company from time to time and set forth in the Securities of the Series
issued from time to time);
(5) the place or places where the principal of and interest on
Registered and Unregistered, if any, Securities of the Series shall be
payable;
<PAGE>
7
(6) the period or periods within which, the price or prices at
which, and the terms and conditions upon which, Securities of the Series
may be redeemed, in whole or in part, at the option of the Company;
(7) the obligation, if any, of the Company to redeem or purchase
Securities of the Series pursuant to any sinking fund or analogous
provisions or upon the happening of a specified event or at the option of
a Holder thereof and the period or periods within which, the price or
prices at which, and the terms and conditions upon which, Securities of
the Series shall be redeemed or purchased, in whole or in part, pursuant
to such obligation;
(8) if in other than denominations of $1,000 and any integral
multiple thereof, the denominations in which Securities of the Series
shall be issuable;
(9) if other than the principal amount thereof, the portion of the
principal amount of Securities of the Series which shall be payable upon
declaration of acceleration of the maturity thereof pursuant to Section
6.02;
(10) whether Securities of the Series shall be issuable as
Registered Securities or Unregistered Securities (with or without interest
coupons), or both and whether, and the terms upon which, Unregistered
Securities of a Series may be exchanged for Registered Securities of the
same Series and vice versa;
(11) any provisions for payment of additional amounts for taxes and
any provision for redemption, in the event the Company must comply with
the reporting requirements in respect of a Security or must pay additional
amounts in respect of any Security;
(12) whether the Securities of the Series shall be issued in whole
or in part in the form of a global Security or Securities and, in such
case, the Depositary and Global Exchange Agent, if any, for such global
Security or Securities, whether such global form shall be permanent or
temporary and, if applicable, the Exchange Date;
(13) if Securities of the Series are to be issuable initially in
the form of a temporary global Security, the circumstances under which the
temporary global Security may be exchanged for definitive Securities and
whether the definitive Securities will be Registered Securities and/or
Unregistered Securities and will be in certificated and/or global form and
whether interest in respect of any portion of such global Security payable
in respect of an interest payment date prior to the Exchange Date shall be
paid to any clearing organization with respect to a portion of such global
Security held for its account and, in such event, the terms and conditions
(including any certification requirements) upon which any such interest
payment received by a clearing organization will be credited to the
persons entitled to interest payable on such interest payment date if
other than as provided in this Article;
(14) any other terms of the Series (which terms shall not be
inconsistent with the provisions of this Indenture) including any terms
which may be required by or advisable
<PAGE>
8
under United States laws or regulations or advisable in connection with
the marketing of Securities of that Series; and
(15) the form of the Securities (or forms thereof if Unregistered
and Registered Securities shall be issuable in such Series, including such
legends as may be required by United States laws or regulations and the
form of any coupons or temporary global Security which may be issued).
(b) At or prior to the issuance of Securities of a Series, the
Company shall deliver to the Trustee (i) a copy of the Board Resolution
establishing the terms (to the extent such terms have been so established) and
form or forms of such Securities or (ii) if a Board Resolution authorizes a
specific Officer or Officers to approve the terms and form or forms of the
Securities, a certificate of such Officer or Officers approving the terms (to
the extent that such terms have been established) and form or forms of the
Securities, in both cases with the form or forms attached thereto.
SECTION 2.03. Execution, Authentication and Delivery.
(a) Securities shall be executed on behalf of the Company by its
Chairman of the Board of Directors or a Vice-Chairman of the Board of Directors
or the President or a Vice- President, and by its Treasurer or an Assistant
Treasurer or its Secretary or an Assistant Secretary. Signatures shall be manual
or facsimile. The Company's seal shall be reproduced on the Securities and may,
but need not, be attested. The coupons of Unregistered Securities shall bear the
facsimile signature of the Treasurer or an Assistant Treasurer of the Company.
(b) If an Officer, an Assistant Treasurer or an Assistant
Secretary whose signature is on a Security or coupon no longer holds that office
at the time the Security is authenticated, the Security or coupon shall be valid
nevertheless.
(c) A Security shall not be valid until authenticated by the
manual signature of the Trustee or an authenticating agent and no coupon shall
be valid until the Security to which it appertains has been so authenticated.
Such signature shall be conclusive evidence that the Security has been
authenticated under this Indenture. Each Unregistered Security shall be dated
the date of its original issuance and each Registered Security shall be dated
the date of its authentication.
(d) At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities of any Series
executed by the Company to the Trustee for authentication, together with a
Company Order for the authentication and delivery of such Securities, and the
Trustee in accordance with the Company Order shall authenticate and deliver such
Securities; provided, however, that no Unregistered Security in definitive form
shall be mailed or otherwise delivered to any location in the United States, and
provided, further that an Unregistered Security in definitive form may be
delivered only if the person entitled to receive such Unregistered Security
shall have furnished a certificate substantially in the form set forth in
Exhibit A to this Indenture, dated no earlier than 15 days prior to the date on
which such Unregistered Security is delivered, unless a certificate
substantially in the form set forth in
<PAGE>
9
Exhibit A to this Indenture has previously been furnished pursuant to Section
2.08. Except as permitted by Section 2.09, the Trustee shall not authenticate
and deliver any Unregistered Security unless all appurtenant coupons for
interest then matured other than matured coupons in default have been detached
and canceled. If all of the Securities of any one Series are not to be issued at
one time and if a Board Resolution or supplemental indenture relating to such
Series shall so permit, such Company Order may set forth procedures acceptable
to the Trustee for the issuance of such Securities, including procedures with
respect to establishing authorized denominations, date of issuance, interest
rate or manner of calculation thereof, the date from which interest, if any,
shall accrue, interest payment dates or the manner of determining the same,
record dates, maturity date or manner of determining the same, redemption
provisions and other terms authorized to be established pursuant to Section
2.02.
In authenticating Securities of any Series, the Trustee shall be
entitled to receive (with respect to each such Series) and shall be fully
protected in relying upon (i) a Board Resolution or an executed supplemental
indenture, as the case may be, and (ii) an Opinion of Counsel stating:
(1) if the form or forms of such Securities have been established
by or pursuant to Board Resolution as permitted by Section 2.02, that such
form or forms have been established in conformity with the provisions of
this Indenture;
(2) if the terms of such Securities have been established by or
pursuant to Board Resolution or supplemental indenture as permitted by
Section 2.02, that such terms have been established in conformity with the
provisions of this Indenture; and
(3) that such Securities, when authenticated and delivered by the
Trustee and issued by the Company in the manner and subject to the
conditions specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Company, enforceable in accordance with
their terms, subject to bankruptcy, insolvency, reorganization and other
laws of general applicability relating to or affecting the enforcement of
creditors' rights and to general equity principles.
If the terms and form or forms of such Securities have been
established by or pursuant to a Board Resolution as permitted by Section 2.02,
the Trustee shall not be required to authenticate such Securities if the issue
of such Securities with such terms and form or forms pursuant to this Indenture
will materially and adversely affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 2.02 and of the second
preceding paragraph, if all Securities of a Series are not to be originally
issued at one time, it shall not be necessary, except as may otherwise be
required by the TIA, to deliver the certificate of an Officer or Officers
otherwise required pursuant to Section 2.02 or the Company Order and Opinion of
Counsel otherwise required pursuant to such second preceding paragraph at or
prior to the time of authentication of each Security of such Series if such
documents are delivered at or prior to the authentication upon original issuance
of the first Security of such Series to be issued.
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10
(e) The aggregate principal amount of Securities of any Series
outstanding at any time may not exceed any limit upon the maximum
principal amount for such Series set forth in the Board Resolution (or
certificate of an Officer or Officers) or supplemental indenture pursuant
to Section 2.02.
(f) The Trustee may appoint an authenticating agent to
authenticate Securities. An authenticating agent may authenticate
Securities whenever the Trustee may do so. Each reference in this
Indenture to authentication by the Trustee includes authentication by such
agent. An authenticating agent has the same rights as an Agent to deal
with the Company or an Affiliate.
(g) Each Depositary designated pursuant to Section 2.02 for a
global Registered Security must, at the time of its designation and at all
times while it serves as Depositary, be a clearing agency registered under
the Securities Exchange Act of 1934 and any other applicable statute or
regulation.
SECTION 2.04. Registrar and Paying Agent.
The Company shall maintain in the Borough of Manhattan, The City of
New York, State of New York, an office or agency where Registered Securities may
be presented for registration of transfer or for exchange ("Registrar") and an
office or agency where (subject to Sections 2.05 and 2.08) Securities may be
presented for payment or for exchange ("Paying Agent"). With respect to any
Series of Securities issued in whole or in part as Unregistered Securities, the
Company shall maintain one or more Paying Agents located outside the United
States and shall maintain such Paying Agents for a period of two years after the
principal of such Unregistered Securities has become due and payable. During any
period thereafter for which it is necessary in order to conform to United States
tax law or regulations, the Company will maintain a Paying Agent outside the
United States to which the Unregistered Securities or coupons appertaining
thereto may be presented for payment and will provide the necessary funds
therefor to such Paying Agent upon reasonable notice. The Registrar shall keep a
register with respect to each Series of Securities issued in whole or in part as
Registered Securities and to their transfer and exchange. The Company may
appoint one or more co-Registrars and one or more additional Paying Agents for
each Series of Securities and the Company may terminate the appointment of any
co-Registrar or Paying Agent at any time upon written notice. The term
"Registrar" includes any co-Registrar. The term "Paying Agent" includes any
additional Paying Agent. The Company shall notify the Trustee of the name and
address of any Agent not a party to this Indenture. If the Company fails to
maintain a Registrar or Paying Agent, the Trustee shall act as such.
The Company initially appoints the Trustee as Registrar and Paying
Agent.
SECTION 2.05. Payment on Securities.
(a) Subject to the following provisions, the Company will pay to
the Trustee the amounts, in such coin or currency of the United States as
is at the time legal tender for the payment of public or private debt, at
the times and for the purposes set forth herein and in the
<PAGE>
11
text of the Securities for each Series, and the Company hereby authorizes and
directs the Trustee from funds so paid to it to make or cause to be made payment
of the principal of and interest, if any, on the Securities and coupons of each
Series as set forth herein and in the text of such Securities and coupons. The
Trustee will arrange directly with any Paying Agents for the payment, or the
Trustee will make payment, from funds furnished by the Company, of the principal
of and interest, if any, on the Securities and coupons of each Series by check
drawn upon a bank in The City of New York.
(b) Interest, if any, on Registered Securities of a Series shall
be paid on each interest payment date for such Securities to the Holder
thereof at the close of business on the relevant record dates specified in
the Securities. The Company may pay such interest by check mailed to such
Holder's address as it appears on the register for Securities of such
Series. Principal of Registered Securities shall be payable only against
presentation and surrender thereof at the office of the Paying Agent in
New York, New York, unless the Company shall have otherwise instructed the
Trustee in writing.
(c) To the extent provided in the Securities of a Series, (i)
interest, if any, on Unregistered Securities shall be paid only against
presentation and surrender of the coupons for such interest installments
as are evidenced thereby as they mature and (ii) original issue discount
(as defined in Section 1273 of the Code), if any, on Unregistered
Securities shall be paid only against presentation and surrender of such
Securities; in either case at the office of a Paying Agent located outside
of the United States, unless the Company shall have otherwise instructed
the Trustee in writing. Principal of Unregistered Securities shall be paid
only against presentation and surrender thereof as provided in the
Securities of a Series. If at the time a payment of principal of or
interest, if any, or original issue discount, if any, on an Unregistered
Security or coupon shall become due, the payment of the full amount so
payable at the office or offices of all the Paying Agents outside the
United States is illegal or effectively precluded because of the
imposition of exchange controls or other similar restrictions on the
payment of such amount in United States currency, then the Company may
instruct the Trustee to make such payments at the office of a Paying Agent
located in the United States, provided that provision for such payment in
the United States would not cause such Unregistered Security to be treated
as a "registration-required obligation" under United States law and
regulations.
(d) Unless otherwise provided or contemplated by Section 2.02,
every permanent global Unregistered Security will provide that interest,
if any, payable on any interest payment date will be paid to each of
Euro-clear and CEDEL, S.A. with respect to that portion of such permanent
global Security held for its account by the Depositary. Each of Euro-clear
and CEDEL, S.A. will in such circumstances credit the interest received by
it in respect of such permanent global Security to the accounts of the
beneficial owners thereof.
SECTION 2.06. Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the Trustee
to agree in writing that the Paying Agent will hold in trust, for the benefit of
Securityholders of any or all Series of Securities, or the Trustee, all money
held by the Paying Agent for the payment of principal or interest on such Series
of Securities, and that the Paying Agent will notify the
<PAGE>
12
Trustee of any default by the Company in making any such payment. While any such
default continues, the Trustee may require a Paying Agent to pay all money held
by it to the Trustee. If the Company or a subsidiary acts as Paying Agent, it
shall segregate the money held by it for the payment of principal or interest on
any Series of Securities and hold such money as a separate trust fund. The
Company at any time may require a Paying Agent to pay all money held by it to
the Trustee. Upon so doing the Paying Agent shall have no further liability for
the money so paid.
SECTION 2.07. Securityholder Lists; Ownership of Securities.
(a) The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names
and addresses of Holders of each Series of Securities. If the Trustee is
not the Registrar, the Company shall furnish to the Trustee semiannually
on or before the last day of June and December in each year, and at such
other times as the Trustee may request in writing, a list, in such form
and as of such date as the Trustee may reasonably require, containing all
the information in the possession or control of the Registrar, the Company
or any of its Paying Agents other than the Trustee as to the names and
addresses of Holders of each such Series of Securities. If there are
Unregistered Securities of any Series outstanding, even if the Trustee is
the Registrar the Company shall furnish to the Trustee such a list
containing such information with respect to Holders of such Unregistered
Securities only.
(b) Ownership of Registered Securities of a Series shall be proved
by the register for such Series kept by the Registrar. Ownership of
Unregistered Securities may be proved by the production of such
Unregistered Securities or by a certificate or affidavit executed by the
person holding such Unregistered Securities or by a depository with whom
such Unregistered Securities were deposited, if the certificate or
affidavit is satisfactory to the Trustee. The Company, the Trustee and any
agent of the Company may treat the bearer of any Unregistered Security or
coupon and the person in whose name a Registered Security is registered as
the absolute owner thereof for all purposes.
(c) None of the Company, the Trustee, any Paying Agent or the
Registrar shall owe any duty or obligation to any beneficial owner of any
Security or have any responsibility or liability for any aspect of the
records or notices relating to or payments made on account of beneficial
ownership interests of a global Security or for maintaining, supervising
or reviewing any records relating to such beneficial ownership interests.
SECTION 2.08. Temporary Securities and Exchange of Securities.
Pending the preparation of definitive Securities of any Series, the
Company may execute, and upon Company Order the Trustee shall authenticate and
deliver, temporary Securities which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued, as Registered Securities or, if authorized, as Unregistered
Securities, and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
evidenced by their execution of such Securities;
<PAGE>
13
provided, however, that no temporary Unregistered Security shall be mailed or
otherwise delivered to any location in the United States, and provided, further
that a temporary Unregistered Security (other than a temporary Unregistered
Security in global form) may be delivered only if the person entitled to receive
such Unregistered Security shall have furnished a certificate substantially in
the form set forth in Exhibit A to this Indenture, dated no earlier than 15 days
prior to the date on which such Unregistered Security is delivered, unless a
certificate substantially in the form set forth in Exhibit A to this Indenture
has previously been furnished pursuant to the eighth paragraph of this Section.
Any such temporary Securities may be in global form, representing such of the
outstanding Securities of such Series as shall be specified therein.
Except in the case of temporary Securities in global form (which
shall be exchanged in accordance with the provisions of the following
paragraphs), if temporary Securities of any Series are issued, the Company will
cause definitive Securities of that Series to be prepared within a reasonable
period of time. After the preparation of definitive Securities of such Series,
the temporary Securities of such Series shall be exchangeable for definitive
Securities of such Series having identical terms upon surrender of the temporary
Securities of such Series at the Registrar or any Paying Agent for that Series,
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities of any Series, the Company shall execute and (in accordance
with a Company Order delivered at or prior to the authentication of the first
definitive Security of such Series) the Trustee or the Global Exchange Agent
shall authenticate and deliver in exchange therefor a like principal amount of
definitive Securities of that Series of authorized denominations and having
identical terms; provided, however, unless otherwise specified pursuant to
Section 2.02, no definitive Unregistered Security shall be delivered in exchange
for a temporary Registered Security. Until exchanged as herein above provided,
the temporary Securities of any Series shall in all respects be entitled to the
same benefits under this Indenture as definitive Securities of that Series
having identical terms authenticated and delivered hereunder.
Any temporary global Security and any permanent global Security
shall, unless otherwise provided therein, be delivered to a Depositary
designated pursuant to Section 2.02, for the benefit, in the case of a global
Unregistered Security, of Euro-clear and CEDEL, S.A., and for credit to the
respective accounts of the beneficial owners of such Securities (or to such
other accounts as they may direct).
Within a reasonable period of time after the Restricted Period but
in any event not later than the date specified in or determined pursuant to the
terms of any such temporary global Security, the Securities represented by any
temporary global Unregistered Security may be exchanged for definitive
Securities (subject to the second succeeding paragraph) or Securities to be
represented thereafter by one or more permanent global Securities (in definitive
form), without interest coupons (the date of such exchange, the "Exchange
Date"). On or after the Exchange Date, such temporary global Security shall be
surrendered by the Depositary to the Trustee, as the Company's agent for such
purpose, or the agent appointed by the Company pursuant to Section 2.02 to
effect the exchange of the temporary global Security for definitive Securities
(the "Global Exchange Agent"), and following such surrender, the Trustee or the
Global Exchange Agent (as authorized by the Trustee as an authenticating agent
pursuant to Section 2.03) shall (1) endorse the temporary global Security to
reflect the reduction of its principal amount by an equal
<PAGE>
14
aggregate principal amount of such Security, (2) endorse the applicable
permanent global Security, if any, to reflect the initial amount, or an increase
in the amount of Securities represented thereby, (3) manually authenticate such
definitive Securities or such permanent global Security (in definitive form), as
the case may be, (4) subject to Section 2.03(d), make available such definitive
Securities to the Depositary therefor or, as the case may be, make available
such permanent global Security (in definitive form) to the Depositary to be held
outside the United States for the accounts of Euro-clear and CEDEL, S.A., for
credit to the respective accounts at Euro-clear and CEDEL, S.A., designated by
or on behalf of the beneficial owners of such Securities (or to such other
accounts as they may direct) and (5) redeliver such temporary global Security to
the Depositary, unless such temporary global Security shall have been canceled
in accordance with Section 2.13; provided, however, that, unless otherwise
specified in such temporary global Security or unless a certificate
substantially in the form set forth in Exhibit B to this Indenture has
previously been provided to the Trustee or the Global Exchange Agent by
Euro-clear or CEDEL, S.A. pursuant to this Section, upon such presentation by
the Depositary, such temporary global Security shall be accompanied by a
certificate dated the Exchange Date, or a subsequent date and signed by
Euro-clear as to the portion of such temporary global Security held for its
account then to be exchanged for definitive Securities or one or more permanent
global Securities (in definitive form), as the case may be, and a certificate
dated the Exchange Date or a subsequent date and signed by CEDEL, S.A., as to
the portion of such temporary global Security held for its account then to be
exchanged for definitive Securities or one or more permanent global Securities,
as the case may be, each substantially in the form set forth in Exhibit B to
this Indenture. Each certificate substantially in the form of Exhibit B hereto
of Euro-clear or CEDEL, S.A., as the case may be, shall be based on certificates
of the account holders listed in the records of Euro-clear or CEDEL, S.A., as
the case may be, as being entitled to all or any portion of the applicable
temporary global Security. An account holder of Euro-clear or CEDEL, S.A., as
the case may be, desiring to effect the exchange of interest in a temporary
global Security for an interest in definitive Securities or one or more
permanent global Securities (in definitive form) shall instruct Euro-clear or
CEDEL, S.A., as the case may be, to request such exchange on its behalf and
shall deliver to Euro-clear or CEDEL, S.A., as the case may be, a certificate
substantially in the form of Exhibit A hereto and dated no earlier than 15 days
prior to the Exchange Date. Until so exchanged, temporary global Securities
shall in all respects be entitled to the same benefits under this Indenture as
definitive Securities and permanent global Securities (in definitive form) of
the same Series authenticated and delivered hereunder, except as to payment of
interest, if any.
The delivery to the Trustee or the Global Exchange Agent by
Euro-clear or CEDEL, S.A., of any certificate substantially in the form of
Exhibit B hereto may be relied upon by the Company and the Trustee or the Global
Exchange Agent as conclusive evidence that a corresponding certificate or
certificates has or have been delivered to Euro-clear or to CEDEL, S.A., as the
case may be, pursuant to the terms of this Indenture.
On or prior to the Exchange Date, the Company shall deliver to the
Trustee or the Global Exchange Agent definitive Securities in aggregate
principal amount equal to the principal amount of such temporary global
Security, executed by the Company. At any time, on or after the Exchange Date,
upon 30 days' written notice to the Trustee or the Global Exchange Agent by
Euro-clear or CEDEL, S.A., as the case may be, acting at the request of or on
behalf of the
<PAGE>
15
beneficial owner, a Security represented by a temporary global Security or a
permanent global Security, as the case may be, may be exchanged, in whole or
from time to time in part, for definitive Securities without charge and the
Trustee or the Global Exchange Agent shall authenticate and deliver, in exchange
for each portion of such temporary global Security or such permanent global
Security, an equal aggregate principal amount of definitive Securities of the
same Series having identical terms as the portion of such temporary global
Security or such permanent global Security to be exchanged, which, unless the
Securities of the Series are not issuable both as Unregistered Securities and as
Registered Securities, as contemplated by Section 2.02, shall be in the form of
Unregistered Securities or Registered Securities, or any combination thereof, as
the Depositary therefor shall instruct the Trustee or the Global Exchange Agent
in writing; provided, however, that definitive Unregistered Securities shall be
delivered in exchange for a portion of the temporary global Security only in
compliance with the requirements of the second preceding paragraph. On or prior
to the 30th day following receipt by the Trustee or the Global Exchange Agent of
such notice with respect to a Security, or, if such day is a Legal Holiday, the
next succeeding day that is not a Legal Holiday, the temporary global Security
or the permanent global Security, as the case may be, shall be surrendered by
the Depositary to the Trustee or the Global Exchange Agent, as the Company's
agent for such purpose, to be exchanged, in whole or from time to time in part,
for definitive Securities without charge following such surrender, upon the
request of Euro-clear or CEDEL, S.A., as the case may be, and the Trustee or the
Global Exchange Agent shall (1) endorse the applicable temporary global Security
or the permanent global Security to reflect the reduction of its principal
amount by the aggregate principal amount of such Security, (2) cause the terms
of such Security to be entered on a definitive Security, (3) manually
authenticate such definitive Security and (4) make available such definitive
Security outside the United States to the Depositary therefor, for or on behalf
of the beneficial owner thereof, in exchange for a portion of such temporary
global Security or such permanent global Security, as the case may be.
Unless otherwise specified in such temporary global Security or
permanent global Security, any such exchange shall be made free of charge to the
beneficial owners of such temporary global Security or permanent global
Security, except that a person receiving definitive Securities must bear the
cost of insurance, postage, transportation and the like in the event that such
person does not take delivery of such definitive Securities in person at the
offices of Euro- clear or CEDEL, S.A. Definitive Unregistered Securities to be
delivered in exchange for any portion of a temporary global Security or a
permanent global Security shall be delivered only outside the United States.
Until exchanged in full as hereinabove provided, any temporary
global Security or permanent global Security shall in all respects be entitled
to the same benefits under this Indenture as definitive Securities of the same
Series having identical terms, except that, unless otherwise specified as
contemplated by Section 2.02, interest payable on such temporary global Security
on an interest payment date for Securities of such Series occurring prior to the
applicable Exchange Date shall be payable to Euro-clear and CEDEL, S.A. on such
interest payment date only upon delivery by Euro-clear and CEDEL, S.A. to the
Trustee of a certificate or certificates substantially in the form set forth in
Exhibit B to this Indenture; provided, however, interest shall be payable only
on that portion of the principal amount of the Securities for which Euro-clear
or CEDEL, S.A. has received certification in the form set forth in Exhibit
<PAGE>
16
A to this Indenture and as to interest on that portion of the principal amount
of the Securities for which proper certification has not been received by
Euro-clear or CEDEL, S.A., the Trustee shall hold such interest until such time
as Euro-clear or CEDEL, S.A. receives such proper certification.
Any definitive Unregistered Security authenticated and delivered by
the Trustee in exchange for a portion of a temporary global Security or a
permanent global Security shall not bear a coupon for any interest which shall
theretofore have been duly paid by the Trustee to CEDEL, S.A. or Euro-clear or
by the Company to the Trustee in accordance with the provisions of this Section
2.08.
SECTION 2.09. Replacement Securities.
(a) If a mutilated Security or a Security with a mutilated coupon
appertaining to it is surrendered to the Trustee, the Company shall issue
and the Trustee shall authenticate a replacement Registered Security, if
such surrendered security was a Registered Security, or a replacement
Unregistered Security with coupons corresponding to the coupons
appertaining to the surrendered Security, if such surrendered Security was
an Unregistered Security, of the same Series having identical terms, if
the Trustee's requirements are met.
(b) If the Holder of a Security claims that the Security or any
coupon appertaining thereto has been lost, destroyed or wrongfully taken,
the Company shall issue and the Trustee shall authenticate a replacement
Registered Security, if such Holder's claim pertains to a Registered
Security, or a replacement Unregistered Security with coupons
corresponding to the coupons appertaining to the lost, destroyed or
wrongfully taken Unregistered Security or the Unregistered Security to
which such lost, destroyed or wrongfully taken coupon appertains, if such
Holder's claim pertains to an Unregistered Security, of the same Series
having identical terms, if the Trustee's requirements are met; provided,
however, that the Trustee or the Company may require any such Holder to
provide to the Trustee and the Company security or indemnity sufficient in
the judgment of the Company and the Trustee to protect the Company, the
Trustee, any Agent or any authenticating agent from any loss which any of
them may suffer if a Security is replaced. The Company may charge the
party requesting a replacement Security for its expenses in replacing a
Security.
(c) Every replacement Security is an additional obligation of the
Company.
SECTION 2.10. Outstanding Securities.
(a) Securities outstanding at any time are all Securities
authenticated by the Trustee except for those cancelled by it, those
delivered to it for cancellation, and those described in this Section as
not outstanding.
(b) If a Security is replaced pursuant to Section 2.09, it ceases
to be outstanding until the Trustee receives proof satisfactory to it that
the replaced Security is held by a bona fide purchaser.
<PAGE>
17
(c) If the Paying Agent holds on a redemption date or maturity
date money sufficient to pay all amounts due on Securities of any Series
on that date, then on and after that date all Securities of such Series
cease to be outstanding and interest on them ceases to accrue.
(d) A Security does not cease to be outstanding because the
Company or an Affiliate holds the Security.
(e) In determining whether the Holders of the requisite principal
amount of outstanding Securities of any Series have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, or
whether sufficient funds are available for redemption or for any other
purpose, the principal amount of an Original Issue Discount Security that
shall be deemed to be outstanding for such purposes shall be the amount of
the principal thereof that would be due and payable as of the date of such
determination upon a declaration of acceleration of the maturity thereof
pursuant to Section 6.02.
SECTION 2.11. Treasury Securities.
In determining whether the Holders of the requisite principal amount
of Securities of any Series have concurred in any direction, waiver or consent,
Securities of such Series owned by the Company or an Affiliate shall be
disregarded, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities of such Series which any Responsible Officer of the Trustee knows are
so owned shall be so disregarded.
SECTION 2.12. Registration, Registration of Transfer and Exchange.
(a) Where Registered Securities of a Series are presented to the
Registrar with a request to register their transfer or to exchange them
for an equal principal amount of Registered Securities of the same Series
of other authorized denominations having identical terms, the Registrar
shall register the transfer or make the exchange if its requirements for
such transactions are met and as set forth below.
(b) Except as set forth below, at the option of the Holder,
Registered Securities of any Series may be exchanged for other Registered
Securities of that Series, of any authorized denominations and in a like
aggregate principal amount having identical terms, upon surrender of the
Securities to be exchanged at the Registrar or any Paying Agent for that
Series. Whenever any Securities are so surrendered for exchange, the
Company shall execute, and the Trustee shall authenticate and deliver, the
Securities which the Holder making the exchange is entitled to receive.
Except as otherwise specified pursuant to Section 2.02, Registered
Securities may not be exchanged for Unregistered Securities.
Notwithstanding any other provision of this Section or Section 2.08,
unless and until it is exchanged in whole or in part for Registered Securities
in definitive form, a global Security representing all or a portion of the
Registered Securities of a Series may not be transferred except as a whole by
the Depositary for such Series to a nominee of such Depositary or by a nominee
of such Depositary to such Depositary or another nominee of such Depositary
<PAGE>
18
or by such Depositary or any such nominee to a successor Depositary for such
Series or a nominee of such successor Depositary.
At the option of the Holder, Unregistered Securities of any Series
may be exchanged for Registered Securities of that Series of any authorized
denominations and of a like aggregate principal amount having identical terms,
upon surrender of the Unregistered Securities to be exchanged at the Registrar
or any Paying Agent for that Series, with all unmatured coupons and all matured
coupons in default thereto appertaining. If the Holder of an Unregistered
Security is unable to produce any such unmatured coupon or coupons or matured
coupon or coupons in default, such exchange may be effected if the Unregistered
Securities are accompanied by payment in funds acceptable to the Company in an
amount equal to the face amount of such missing coupon or coupons, or the
surrender of such missing coupon or coupons may be waived by the Company and the
Trustee if there is furnished to them such security or indemnity as they may
require to save each of them and any Paying Agent harmless. If thereafter the
Holder of such Security shall surrender to any Paying Agent any such missing
coupon in respect of which such a payment shall have been made, such Holder
shall be entitled to receive the amount of such payment; provided, however, that
interest represented by coupons shall be payable only upon presentation and
surrender of those coupons at an office or agency located outside the United
States. Notwithstanding the foregoing, in case an Unregistered Security of any
Series is surrendered at the Registrar or any Paying Agent in exchange for a
Registered Security of the same Series and having identical terms after the
close of business on (i) any regular record date and before the opening of
business on the relevant interest payment date, or (ii) any special record date
and before the opening of business on the related proposed date for payment of
interest then in default, such Unregistered Security shall be surrendered
without the coupon relating to such interest payment date or proposed date for
payment, as the case may be (or, if such coupon is so surrendered with such
Unregistered Security, such coupon shall be returned to the person so
surrendering the Unregistered Security), and interest or interest then in
default, as the case may be, will not be payable on such interest payment date
or proposed date for payment, as the case may be, in respect of the Registered
Security issued in exchange for such Unregistered Security, but will be payable
only to the holder of such coupon when due in accordance with the provisions of
this Indenture.
Whenever any Securities are so surrendered for exchange, the Company
shall execute, and the Trustee shall authenticate and deliver, the Securities
which the Holder making the exchange is entitled to receive.
If at any time the Depositary for Registered Securities of a Series
notifies the Company that it is unwilling or unable to continue as Depositary
for the Securities of such Series or if at any time the Depositary for the
Securities for such Series shall no longer be eligible under Section 2.03, the
Company shall appoint a successor Depositary with respect to the Securities for
such Series. If a successor Depositary for the Securities of such Series is not
appointed by the Company within 90 days after the Company receives such notice
or becomes aware of such ineligibility, the Company's election pursuant to
Section 2.02(a)(12) shall no longer be effective with respect to the Securities
for such Series and the Company will issue, and the Trustee, upon receipt of a
Company Order for the authentication and delivery of definitive Securities of
such Series, will authenticate and deliver Securities having identical terms in
<PAGE>
19
definitive form in exchange for an aggregate principal amount equal to the
principal amount of the global Security or Securities representing such
Securities.
The Company may at any time and in its sole discretion determine
that the Registered Securities of any Series issued in the form of one or more
global Securities shall no longer be represented by such global Security or
Securities. In such event, the Company will issue, and the Trustee, upon receipt
of a Company Order for the authentication and delivery of definitive Registered
Securities of such Series, will authenticate and deliver, Registered Securities
of such Series in definitive form and in an aggregate principal amount equal to
the principal amount in exchange for the global Security or Securities
representing such Registered Securities.
If specified by the Company pursuant to Section 2.02 with respect to
Registered Securities of a Series, the Depositary for such Series may surrender
a global Security for such Series in exchange in whole or in part for Securities
of such Series having identical terms in definitive form on such terms as are
acceptable to the Company and such Depositary. Thereupon the Company shall
execute, and the Trustee shall authenticate and deliver, without service charge,
(i) to each person specified in writing by such Depositary a new Security or
Securities of the same Series having identical terms and of any authorized
denomination as requested by such person in aggregate principal amount equal to
and in exchange for such person's beneficial interest in the global Security;
and (ii) to such Depositary a new global Security having identical terms and in
a denomination equal to the difference, if any, between the principal amount of
the surrendered global Security and the aggregate principal amount of Securities
delivered to Holders thereof.
Upon the exchange of a global Security for Securities in definitive
form, such global Security shall be canceled by the Trustee. Registered
Securities issued in exchange for a global Security pursuant to this Section
shall be registered in such names and in such authorized denominations as the
Depositary for such global Security, pursuant to instructions from its direct or
indirect participants or otherwise, shall instruct the Trustee in writing. The
Trustee shall deliver such Registered Securities to the persons in whose names
such Securities are so registered.
All Securities issued upon any registration of transfer or exchange
of Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
Every Registered Security presented or surrendered for registration
of transfer or for exchange shall (if so required by the Company or the Trustee)
be duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Registrar duly executed, by the Holder
thereof or his attorney duly authorized in writing.
(c) The Company will not make any charge for any registration of
transfer or exchange but may require the payment by the party requesting
such registration of transfer or exchange of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
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(d) Neither the Company nor the Registrar shall be required (i) to
issue, register the transfer of or exchange Securities of any Series for
the period of 15 days immediately preceding the selection of any such
Securities to be redeemed, or (ii) to register the transfer of or exchange
Securities of any Series selected, called or being called for redemption
as a whole or the portion being redeemed of any such Securities selected,
called or being called for redemption in part.
(e) Unregistered Securities or any coupons appertaining thereto
shall be transferable by delivery.
SECTION 2.13. Cancellation.
The Company at any time may deliver Securities and coupons to the
Trustee for cancellation. The Registrar and the Paying Agent shall forward to
the Trustee any Registered Securities surrendered to them, for registration of
transfer, or for exchange or payment. The Trustee shall cancel all Securities
and coupons surrendered to it for registration of transfer, or for exchange,
payment or cancellation and, subject to the provisions of this Section, may
dispose of canceled Securities and coupons as the Company directs. The Registrar
and Paying Agent shall cancel all Unregistered Securities and coupons
surrendered to it for registration of transfer, or for exchange or payment. The
Registrar and Paying Agent shall forward such canceled Unregistered Securities
and coupons to the Trustee and, in the case of an exchange, deliver a
certificate to the Trustee specifying the name, address, taxpayer identification
number, if any, of the Holder or Holders of the Registered Security or
Registered Securities to be issued in exchange for such canceled Security or
Securities, the principal amount(s) and authorized denominations of the Security
or Securities to be issued in exchange for such canceled Security or Securities
and any other information reasonably required by the Trustee and in the case of
a payment, deliver a certificate stating that payment was made in the full
amount and any other information reasonably required by the Trustee. The Company
may not issue new Securities to replace Securities that it has paid or delivered
to the Trustee for cancellation. Notwithstanding any other provision of this
Indenture to the contrary, in the case of a Series all the Securities of which
are not to be originally issued at one time, a Security of such Series shall not
be deemed to have been outstanding at any time hereunder if and to the extent
that, subsequent to the authentication and delivery thereof, such Security is
delivered to the Trustee for cancellation by the Company or any agent thereof
upon the failure of the original purchaser thereof to make payment therefor
against delivery thereof, and any Security so delivered to the Trustee shall be
promptly canceled by it. In the case of any temporary global Security, which may
be destroyed if the entire aggregate principal amount of the Securities
represented thereby has been exchanged, any certificate of destruction shall
state that all certificates required pursuant to Section 2.08 hereof and
substantially in the form of Exhibit B hereto, to be given by Euro-clear or
CEDEL, S.A., have been duly presented to the Trustee by Euro-clear or CEDEL,
S.A., as the case may be. Permanent global Securities shall not be destroyed
until exchanged in full for definitive Securities or until payment thereon is
made in full.
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SECTION 2.14. Calculation of Interest; Defaulted Interest.
(a) Unless otherwise provided in the Securities of any Series or
any supplemental indenture with respect thereto entered into in accordance
with the terms of this Indenture, the amount of interest payable with
respect to such Securities on any interest payment date shall be computed
on the basis of the actual number of days elapsed over a 360-day year
consisting of twelve 30-day months.
(b) If the Company defaults on a payment of interest on a Series
of Securities, it shall pay the defaulted interest as provided in such
Securities or in any lawful manner not inconsistent with the requirements
of any securities exchange on which such Securities may be listed and
acceptable to the Trustee.
ARTICLE 3
REDEMPTION
SECTION 3.01. Notice to Trustee.
The Company may, with respect to any Series of Securities or any
Security of a Series, reserve the right to redeem and pay the Series of
Securities or any part thereof, or may covenant to redeem and pay the Series of
Securities or any part thereof, before maturity at such time and on such terms
as provided for in such Securities or Security. If a Series of Securities or any
part thereof is redeemable and the Company wants or is obligated to redeem all
or part of the Series of Securities pursuant to the terms of such Securities or
Security, it shall notify the Trustee of the redemption date and the principal
amount of the Series of Securities or any part thereof to be redeemed. The
Company shall give such notice at least 45 days before the redemption date (or
such shorter notice as may be acceptable to the Trustee).
SECTION 3.02. Selection of Securities to be Redeemed.
If less than all the Securities of a Series (or, where the
redemption provisions of any Series of Securities are not identical as to each
Security within the Series, if less than all of the Securities of a Series with
identical redemption provisions) are to be redeemed, the Trustee, not more than
60 days prior to the redemption date, shall select the Securities to be redeemed
in such manner as the Trustee shall deem fair and appropriate. The Trustee shall
make the selection from Securities of a Series (or, if the redemption provisions
of all of the Securities of the Series are not identical, from Securities of a
Series with identical redemption provisions) that are outstanding and that have
not been called previously for redemption. Securities of the Series and portions
of them selected by the Trustee shall be in principal amounts of $1,000 or
integral multiples of $1,000 or, with respect to Securities of any Series
issuable in other denominations pursuant to Section 2.02(a)(8), in amounts equal
to the minimum principal denomination for each such Series and integral
multiples thereof. Provisions of this Indenture that apply to Securities of a
Series called for redemption also apply to portions of Securities of that Series
called for redemption. The Trustee promptly shall notify the Company in writing
of the Securities selected
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22
hereunder for redemption and, in the case of any Securities selected for partial
redemption, the principal amount thereof to be redeemed.
SECTION 3.03. Notice of Redemption.
(a) At least 30 days but not more than 90 days before a redemption
date, the Company shall mail a notice of redemption by first-class mail to
each Holder of Registered Securities that are to be redeemed.
(b) If Unregistered Securities are to be redeemed, notice of
redemption shall be published in an Authorized Newspaper in each of The
City of New York, London and, if such Securities to be redeemed are listed
on the Luxembourg Stock Exchange, Luxembourg once in each of four
successive calendar weeks, the first publication to be not less than 30
nor more than 90 days before the redemption date.
(c) All notices shall identify the Series of Securities or part
thereof to be redeemed and shall state:
(1) the redemption date;
(2) the redemption price;
(3) if less than all the outstanding Securities of a Series
(or, in the case of a Series of Securities in which the redemption
provisions are not identical as to each Security within the Series,
less than all of the Securities of a Series with identical
redemption provisions) are to be redeemed, the identification (and,
in the case of partial redemption, the principal amounts) of the
particular Securities to be redeemed;
(4) the name and address of the Paying Agent;
(5) that Securities called for redemption and all unmatured
coupons, if any, appertaining thereto must be surrendered to the
Paying Agent to collect the redemption price; and
(6) that interest on Securities called for redemption ceases
to accrue on or after the redemption date.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense.
SECTION 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed or published, Securities of a
Series called for redemption become due and payable on the redemption date. Upon
surrender to the Paying Agent of such Securities together with all unmatured
coupons, if any, appertaining thereto, such
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23
Securities shall be paid at the redemption price plus accrued interest to the
redemption date, but installments of interest due on or prior to the redemption
date will be payable, in the case of Unregistered Securities, to the bearers of
the coupons for such interest upon surrender thereof, and, in the case of
Registered Securities, to the Holders of such Securities of record at the close
of business on the relevant record dates.
SECTION 3.05. Deposit of Redemption Price.
On or before the redemption date, the Company shall deposit with the
Trustee money sufficient to pay the redemption price of and (unless the
redemption date shall be an interest payment date) interest accrued to the
redemption date on all Securities to be redeemed on that date.
SECTION 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, the Company
shall issue and the Trustee shall authenticate for the Holder of that Security a
new Security or Securities of the same Series, the same form and the same
maturity in authorized denominations equal in aggregate principal amount to the
unredeemed portion of the Security surrendered.
ARTICLE 4
COVENANTS
SECTION 4.01. Payment of Securities.
The Company shall pay the principal of and interest on the
Securities on the dates and in the manner provided herein and in the Securities.
An installment of principal or interest shall be considered paid on the date it
is due if the Trustee or Paying Agent holds on that date money designated for
and sufficient to pay the installment.
The Company shall pay interest on overdue principal of a Security of
any Series at the rate of interest (or Yield to Maturity in the case of Original
Issue Discount Securities) borne by the Securities of that Series; to the extent
lawful, it shall pay interest on overdue installments of interest at the same
rate.
SECTION 4.02. No Additional Bonds Under Refunding Mortgage.
(a) As long as any Securities remain outstanding, the Company will
not issue any additional bonds under the Refunding Mortgage except bonds issued,
as provided in the Refunding Mortgage, in respect of bonds surrendered for
registration of transfer, or for exchange, or for substitution for mutilated,
destroyed, lost or stolen bonds.
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24
(b) Nothing in this Indenture prevents the Company from subjecting
any property or assets to the lien of the Refunding Mortgage, or from taking any
action that it deems necessary to comply with the Refunding Mortgage.
SECTION 4.03. Earnings Coverage for Interest Charges.
As long as any Securities remain outstanding, the Company will not
issue additional funded debt securities ranking equally with or prior to the
Securities unless, on the date of the proposed issuance of the new funded debt
securities, the earnings of the Company available for payment of interest
charges during the period of any 12 consecutive calendar months out of the
preceding 15 such months was at least 1.75 times the annualized interest for
that 12-month period on the total of the funded debt securities outstanding
during such period plus the funded debt securities proposed to be issued.
"Earnings of the Company available for payment of interest charges" means income
before extraordinary items plus all (1) taxes in respect of income, (2) interest
charges on funded debt securities and (3) interest charges on other indebtedness
retired or to be retired by or in anticipation of funded debt securities issued
during the period or in respect of which the computation is made. Interest
charged to construction is to be includable in income. There shall not be
included in annualized interest charges the interest on bonds issued under the
Refunding Mortgage or on any other funded debt securities held in any sinking
fund or on any funded debt securities retired or to be retired by or in
anticipation of funded debt securities issued during the period or in respect of
which the computation is made. "Funded debt securities" means securities
evidencing indebtedness of the Company for borrowed money maturing by its terms
more than one year after the date of the issuance of the new funded debt
securities. Any computation under this Section 4.03 may, at the Company's
option, be based on consolidated figures of the Company and its consolidated
subsidiaries.
SECTION 4.04. Lien on Assets.
If at any time the Company mortgages, pledges or otherwise subjects
to any lien the whole or any part of any property or assets now owned or
hereafter acquired by it, except as provided in Section 4.02(b) or as
hereinafter provided in this Section 4.04, the Company will secure the
outstanding Securities, and any other obligations of the Company which may then
be outstanding and entitled to the benefit of a covenant similar in effect to
this covenant, equally and ratably with the indebtedness or obligations secured
by such mortgage, pledge or lien, for as long as any such indebtedness or
obligation is so secured. The foregoing covenant does not apply to the creation,
extension, renewal or refunding of purchase-money mortgages or liens, or to the
making of any deposit or pledge to secure public or statutory obligations or
with any governmental agency at any time required by law in order to qualify the
Company to conduct its business or any part thereof or in order to entitle it to
maintain self-insurance or to obtain the benefits of any law relating to
workmen's compensation, unemployment insurance, old age pensions or other social
security, or with any court, board, commission or governmental agency as
security incident to the proper conduct of any proceeding before it. Nothing
contained in this Indenture prevents an Affiliate from mortgaging, pledging or
subjecting to any lien any property or assets, whether or not acquired by such
Affiliate from the Company.
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25
SECTION 4.05. Reports by the Company.
The Company covenants:
(a) to file with the Trustee, within 15 days after the Company is
required to file the same with the SEC, copies of the annual reports and
of the information, documents and other reports (or copies of such
portions of any of the foregoing as the SEC may from time to time by rules
and regulations prescribe) which the Company may be required to file with
the SEC pursuant to section 13 or section 15(d) of the Securities Exchange
Act of 1934, as amended; or, if the Company is not required to file
information, documents or reports pursuant to either of such sections,
then to file with the Trustee and the SEC, in accordance with rules and
regulations prescribed from time to time by the SEC, such of the
supplementary and periodic information, documents and reports which may be
required pursuant to section 13 of the Securities Exchange Act of 1934, as
amended, in respect of a security listed and registered on a national
securities exchange as may be prescribed from time to time in such rules
and regulations;
(b) to file with the Trustee and the SEC, in accordance with the
rules and regulations prescribed from time to time by the SEC, such
additional information, documents, and reports with respect to compliance
by the Company with the conditions and covenants provided for in this
Indenture as may be required from time to time by such rules and
regulations;
(c) to transmit by mail to all Holders of Registered Securities,
as the names and addresses of such Holders appear on the register for each
Series of Securities, and to such Holders of Unregistered Securities as
have, within the two years preceding such transmission, filed their names
and addresses with the Trustee for that purpose, within 30 days after the
filing thereof with the Trustee, such summaries of any information,
documents and reports required to be filed by the Company pursuant to
subsections (a) and (b) of this Section 4.05 as may be required by rules
and regulations prescribed from time to time by the SEC; and
(d) to deliver to the Trustee, within 120 days after the end of
each fiscal year, a brief certificate (which need not comply with Section
10.05), signed by an Officer of the Company, stating whether or not such
Officer has knowledge of any default by the Company in the performance or
fulfillment of any covenant, agreement, or condition contained in this
Indenture, and, if so, specifying each such default of which such Officer
has knowledge, the nature thereof, and what action, if any, has been taken
and is proposed to be taken to cure such default.
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26
ARTICLE 5
SUCCESSOR CORPORATION
SECTION 5.01. When Company May Merge, etc.
The Company may consolidate with, or merge into, or be merged into,
or transfer or lease its properties and assets substantially as an entirety to,
any person provided the person is a corporation, the person assumes by
supplemental indenture all the obligations of the Company under the Securities
and any coupons appertaining thereto and under this Indenture and, after giving
effect thereto, no Default or Event of Default shall have occurred and be
continuing. Thereafter all such obligations of the Company shall terminate.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default.
An "Event of Default" occurs with respect to the Securities of any
Series if:
(1) the Company defaults in the payment of interest on any
Security of that Series when the same becomes due and payable and the
Default continues for a period of 90 days;
(2) the Company defaults in the payment of the principal or
premium, if any, of any Security of that Series when the same becomes due
and payable at maturity, upon redemption or otherwise;
(3) the Company fails to comply with any of its other agreements
in the Securities of that Series, in this Indenture or in any supplemental
indenture under which the Securities of that Series may have been issued
and the Default continues for the period and after the notice specified
below;
(4) the Company pursuant to or within the meaning of any
Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against it
in an involuntary case,
(C) consents to the appointment of a Custodian of it or for
all or substantially all of its property, or
(D) makes a general assignment for the benefit of its
creditors; or
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(5) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against the Company in an involuntary
case,
(B) appoints a Custodian of the Company or for all or
substantially all of its property, or
(C) orders the liquidation of the Company, and the order or
decree remains unstayed and in effect for 90 days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar
federal or state law for the relief of debtors. The term "Custodian" means any
receiver, trustee, assignee, liquidator or similar official under any Bankruptcy
Law.
A Default under clause (3) is not an Event of Default until the
Trustee or the Holders of at least 25% in principal amount of all the
outstanding Securities of that Series notify the Company (and the Trustee in the
case of notification by such Holders) of the Default and the Company does not
cure the Default within 90 days after receipt of the notice. The notice must
specify the Default, demand that it be remedied and state that the notice is a
"Notice of Default".
SECTION 6.02. Acceleration.
If an Event of Default occurs with respect to the Securities of any
Series and is continuing, the Trustee, by notice to the Company, or the Holders
of at least 25% in principal amount of all of the outstanding Securities of that
Series, by notice to the Company and to the Trustee, may declare the principal
(or, if the Securities of that Series are Original Issue Discount Securities,
such portion of the principal amount as may be specified in the terms of that
Series) of all the Securities of that Series to be due and payable. Upon such
declaration, such principal (or, in the case of Original Issue Discount
Securities, such specified amount) shall be due and payable immediately. The
Holders of a majority in principal amount of all of the Securities of that
Series, by notice to the Trustee, may rescind such a declaration and its
consequences if the rescission would not conflict with any judgment or decree
and if all existing Events of Default have been cured or waived except
nonpayment of principal or interest that has become due solely because of the
acceleration.
SECTION 6.03. Other Remedies Available to Trustee.
(a) If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy to collect the payment of principal or interest
on the Securities of the Series that is in default or to enforce the performance
of any provision of the Securities of that Series or this Indenture.
(b) The Trustee may maintain a proceeding even if it does not
possess any of the Securities or does not produce any of them in the proceeding.
A delay or omission by the Trustee or any Securityholder in exercising any right
or remedy accruing upon an Event of
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Default shall not impair the right or remedy or constitute a waiver of or
acquiescence in the Event of Default. No remedy is exclusive of any other
remedy. All available remedies are cumulative.
SECTION 6.04. Waiver of Existing Defaults.
The Holders of a majority in principal amount of any Series of
Securities by notice to the Trustee may waive an existing Default with respect
to that Series and its consequences except a Default in the payment of the
principal of or interest on any Security.
SECTION 6.05. Control by Majority.
The Holders of a majority in principal amount of the Securities of
each Series affected (with each such Series voting as a class) may direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or exercising any trust or power conferred on it. However, the
Trustee may refuse to follow any direction that conflicts with law or this
Indenture, that is unduly prejudicial to the rights of the Securityholders of
all Series so affected, or that would involve the Trustee in personal liability.
SECTION 6.06. Limitation on Suits by Securityholders.
A Securityholder may pursue a remedy with respect to this Indenture
or the Securities of any Series only if:
(1) the Holder gives to the Trustee written notice of a continuing
Event of Default;
(2) the Holders of at least 25% in principal amount of the
Securities of that Series make a written request to the Trustee to pursue
the remedy;
(3) such Holder or Holders offer to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense to be,
or which may be, incurred by the Trustee in pursuing the remedy;
(4) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of indemnity; and
(5) during such 60 day period, the Holders of a majority in
principal amount of the Securities of that Series do not give the Trustee
a direction inconsistent with the request.
A Securityholder of any Series may not use this Indenture to
prejudice the rights of another Securityholder of that Series or any other
Series or to obtain a preference or priority over another Securityholder of that
Series or any other Series.
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29
SECTION 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Security to receive payment of principal and interest on the
Security, on or after the respective due dates expressed in the Security, and
the right of any Holder of a coupon to receive payment of interest due as
provided in such coupon, or to bring suit for the enforcement of any such
payment on or after such respective dates, shall not be impaired or affected
without the consent of such Holder.
SECTION 6.08. Collection Suits by Trustee.
If an Event of Default specified in Section 6.01(1) or (2) occurs
and continues for the period specified therein, if any, the Trustee may recover
judgment in its own name and as trustee of an express trust against the Company
for the whole amount of such principal and interest then in default.
SECTION 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee and the Securityholders allowed in any judicial proceedings relating to
the Company, its creditors or its property.
SECTION 6.10. Priorities.
If the Trustee collects any money pursuant to this Article, it shall
pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 7.07;
SECOND: to Holders of Securities in respect of which or for the
benefit of which such money has been collected for amounts due and unpaid
on such Securities for principal and interest, ratably, without preference
or priority of any kind, according to the amounts due and payable on such
Securities for principal and interest, respectively; and
THIRD: to the Company.
The Trustee may fix a record date (with respect to Registered
Securities) and payment date for any such payment to Holders of Securities.
SECTION 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the
<PAGE>
30
claims or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by a Holder pursuant to Section 6.07, or a suit by
Holders of more than 10% in principal amount of the Securities of any Series.
ARTICLE 7
TRUSTEE
SECTION 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise its rights and powers under this Indenture and use the
same degree of care and skill in their exercise as a prudent man would exercise
or use under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties that are
specifically set forth in the Indenture and no implied covenants or
obligations shall be read into this Indenture against the Trustee.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture.
However, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b) of
this Section.
(2) The Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) Every provision of this Indenture that in any way relates to
the Trustee is subject to Paragraphs (a), (b) and (c) of this Section.
(e) The Trustee may refuse to perform any duty or exercise any
right or power unless it receives indemnity satisfactory to it against any loss,
liability or expense.
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(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
SECTION 7.02. Rights of Trustee.
(a) The Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper person. The Trustee
need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
consult with counsel or require an Officers' Certificate. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
a Board Resolution, the written advice of counsel acceptable to the Company
(unless an Event of Default shall have occurred in which case such counsel need
not be acceptable to the Company) and the Trustee, a certificate of an Officer
or Officers delivered pursuant to Section 2.02(b) or an Officers' Certificate.
(c) The Trustee may act through agents, attorneys, custodians or
nominees and shall not be responsible for the misconduct or negligence of any
agent, attorney, custodian or nominee appointed with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers.
SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company or an
Affiliate with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights. However, the Trustee is subject to Sections
7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy
of this Indenture or the Securities. It shall not be accountable for the
Company's use of the proceeds from the Securities or for monies paid over to the
Company pursuant to the Indenture, and it shall not be responsible for any
statement in the Securities other than its certificate of authentication.
SECTION 7.05. Notice of Defaults.
If a Default occurs and is continuing with respect to the Securities
of any Series and if it is known to any Responsible Officer of the Trustee, the
Trustee shall mail to each Holder of a Security of that Series entitled to
receive reports pursuant to Section 4.05(c) (and, if Unregistered Securities of
that Series are outstanding, shall cause to be published at least once in an
Authorized Newspaper in each of The City of New York, London and, if Securities
of that
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Series are listed on The Luxembourg Stock Exchange, Luxembourg)
notice of the Default within 90 days after it occurs. Except in the case of a
Default in payment on the Securities of any Series, the Trustee may withhold the
notice if and so long as its Corporate Trust Committee or a committee of its
Responsible Officers in good faith determines that withholding such notice is in
the interests of Securityholders of that Series.
SECTION 7.06. Reports by Trustee to Holders.
(a) Within 60 days after June 1st of each year, the Trustee shall
mail to each Securityholder of that Series entitled to receive reports pursuant
to Section 4.05(c) a brief report dated as of such date that complies with TIA
ss.ss. 313(a). The Trustee also shall comply with TIA ss.ss. 313(b) and 313(c).
(b) At the time that it mails such a report to Securityholders of
any Series, the Trustee shall file a copy of that report with the SEC and with
each stock exchange on which the Securities of that Series are listed. The
Company shall provide written notice to the Trustee when the Securities of any
Series are listed on any stock exchange.
SECTION 7.07. Compensation and Indemnity.
(a) The Company shall pay to the Trustee from time to time
reasonable compensation for its services. The Trustee's compensation shall not
be limited by any law on compensation of a trustee of an express trust. The
Company shall reimburse the Trustee upon request for all reasonable
out-of-pocket expenses incurred by it in connection with the performance of its
duties under this Indenture. Such expenses shall include the reasonable
compensation and expenses of the Trustee's agents and counsel.
(b) The Company shall indemnify the Trustee against any loss or
liability incurred by it arising out of or in connection with its acceptance or
administration of the trust or trusts hereunder. The Trustee shall notify the
Company promptly of any claim for which it may seek indemnity. The Company shall
defend the claim and the Trustee shall cooperate in the defense. The Trustee may
have separate counsel and the Company shall pay the reasonable fees and expenses
of such counsel. The Company need not pay for any settlement made without its
consent.
(c) The Company need not reimburse any expense or indemnify
against any loss or liability incurred by the Trustee through negligence or bad
faith.
(d) To secure the payment obligations of the Company pursuant to
this Section, the Trustee shall have a lien prior to the Securities of any
Series on all money or property held or collected by the Trustee, except that
held in trust to pay principal and interest on particular Securities of a
Series.
(e) If the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(4) or (5) occurs, such expenses and
the compensation for such services are intended to constitute expenses of
administration under any Bankruptcy Law.
<PAGE>
33
SECTION 7.08. Replacement of Trustee.
(a) The resignation or removal of the Trustee and the appointment
of a successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
(b) The Trustee may resign with respect to the Securities of any
Series by so notifying the Company. The Holders of a majority in principal
amount of the Securities of any Series may remove the Trustee with respect to
that Series by so notifying the Trustee and the Company and may appoint a
successor Trustee for such Series with the Company's consent. The Company may
remove the Trustee with respect to Securities of any Series if:
(1) the Trustee fails to comply with TIAss.310(b) pursuant to
Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or public officer takes charge of the Trustee or
its property; or
(4) the Trustee becomes incapable of acting.
(c) If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, with respect to Securities of any Series,
the Company shall promptly appoint a successor Trustee for such Series.
(d) If a successor Trustee with respect to the Securities of any
Series does not take office within 30 days after the retiring Trustee resigns or
is removed, the retiring Trustee, the Company or the Holders of a majority in
principal amount of the Securities of the applicable Series may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
(e) If the Trustee with respect to the Securities of any Series
fails to comply with Section 7.10, any Securityholder of the applicable Series
may petition any court of competent jurisdiction for the removal of such Trustee
and the appointment of a successor Trustee.
(f) A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee for any Series of Securities
shall become effective, and the successor Trustee shall have all the rights,
powers and duties of the retiring Trustee with respect to all Series of
Securities for which the successor Trustee is to be acting as Trustee under this
Indenture. The retiring Trustee shall promptly transfer all property held by it
as Trustee with respect to such Series of Securities to the successor Trustee
subject to the lien provided for in Section 7.07. The Company shall give notice
of each appointment of a successor Trustee for any Series of Securities by
publishing notice of such event once in an Authorized Newspaper in each of The
City of New York, London, and, if Securities of that Series are listed on The
Luxembourg Stock Exchange, Luxembourg, and by mailing written notice of such
event by first-class mail to the Holders of Securities of such Series entitled
to receive reports pursuant to Section 4.05(c).
<PAGE>
34
(g) All provisions of this Section 7.08 except subparagraphs
(b)(1) and (e) and the words "subject to the lien provided for in Section 7.07"
in subparagraph (f) shall apply also to any Paying Agent located outside the
U.S. and its possessions and required by Section 2.04.
(h) In case of the appointment hereunder of a successor Trustee
with respect to the Securities of one or more (but not all) Series, the Company,
the retiring Trustee and such successor Trustee shall execute and deliver a
supplemental indenture wherein such successor Trustee shall accept such
appointment and which (1) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, such successor Trustee all
the rights, powers, trusts and duties of the retiring Trustee with respect to
the Securities of that or those Series to which the appointment of such
successor Trustee relates, (2) if the retiring Trustee is not retiring with
respect to all Securities, shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of that or those Series
as to which the retiring Trustee is not retiring shall continue to be vested in
the retiring Trustee, and (3) shall add to or change any of the provisions of
this Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee.
(i) No Trustee under this Indenture shall be liable for any action
or omission of any successor Trustee.
SECTION 7.09. Successor Trustee, Agents by Merger, etc.
If the Trustee or any Agent consolidates with, merges or converts
into, or transfers all or substantially all of its corporate trust business
assets to, another corporation, the successor corporation, without any further
act, shall be the successor Trustee or Agent, as the case may be.
SECTION 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee with respect to each
Series of Securities who satisfies the requirements of TIA ss. 310(a)(1). The
Trustee shall always have a combined capital and surplus of at least
$100,000,000 as set forth in its most recent published annual report of
condition. The Trustee is subject to TIA ss. 310(b), except that there shall be
excluded from the operation of TIA ss.ss. 310(b)(1) all indentures of the
Company now or hereafter existing which may be excluded under the proviso of TIA
ss. 310(b)(1), including (i) the indenture between the Company and The Chase
Manhattan Bank, N.A., dated June 15, 1976 pursuant to which the Company's Forty
Year 8 5/8% Debentures, due June 15, 2016 were issued, and (ii) the indenture
between the Company and The Chase Manhattan Bank, N.A., dated October 15, 1976
pursuant to which the Company's Thiry-Nine Year 8 1/4% Debentures, due October
15, 2015 were issued.
<PAGE>
35
SECTION 7.11. Preferential Collection of Claims Against Company.
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated.
SECTION 7.12. Rights of Trustee in Capacity of Registrar or Paying
Agent.
In the event that the Trustee is also acting in the capacity of
Paying Agent or Registrar hereunder, the rights and protections afforded to the
Trustee pursuant to this Article 7 shall also be afforded to the Trustee in such
capacity.
ARTICLE 8
DISCHARGE OF INDENTURE
SECTION 8.01. Termination of Company's Obligations.
(a) The Company reserves the right to terminate all of its
obligations under the Securities and this Indenture with respect to the
Securities of any Series or any installment of principal of or interest on that
Series if the Company irrevocably deposits in trust with the Trustee money or
U.S. Government Obligations sufficient to pay, when due, principal, premium, if
any, and interest on the Securities of that Series to maturity or redemption or
such installment of principal or interest, as the case may be. and if all other
conditions set forth in the Securities of that Series are met. The Company shall
designate the installment or installments of principal or interest to be so
satisfied.
(b) However, the Company's obligations in Sections 2.04, 2.05,
2.06, 2.07, 2.08, 2.09, 4.01, 7.07, 7.08, 8.03 and 8.04 shall survive until the
Securities are no longer outstanding. Thereafter the Company's obligations in
Sections 7.07, 8.03 and 8.04 shall survive.
(c) Before or after a deposit the Company may make arrangements
satisfactory to the Trustee for the redemption of Securities at a future date in
accordance with Article 3.
(d) After a deposit by the Company in accordance with this Section
in respect of the Securities of a Series, the Trustee upon request shall
acknowledge in writing the discharge of the Company's obligations under the
Securities of the Series in respect of which the deposit has been made and this
Indenture with respect to the Securities of that Series except for those
surviving obligations specified above.
(e) In order to have money available on a payment date to pay
principal or interest on the Securities of any Series, the U.S. Government
Obligations shall be payable as to principal or interest on or before such
payment date in such amounts as will provide the necessary money. U.S.
Government Obligations shall not be callable at the issuer's option.
<PAGE>
36
(f) "U.S. Government Obligations" means:
(1) direct obligations of the United States of America for the
payment of which the full faith and credit of the United States of America
is pledged; or
(2) obligations of a person controlled or supervised by and acting
as an agency or instrumentality of the United States of America, the
payment of which is unconditionally guaranteed as a full faith and credit
obligation by the United States of America.
SECTION 8.02. Application of Trust Money.
The Trustee shall hold in trust money or U.S. Government Obligations
deposited with it pursuant to Section 8.01. It shall apply the deposited money
and the money from U.S. Government Obligations through the Paying Agent and in
accordance with this Indenture to the payment of principal and interest on the
Securities of each Series in respect of which the deposit shall have been made.
SECTION 8.03. Repayment to Company.
(a) The Trustee and the Paying Agent shall promptly pay to the
Company upon request any excess money or securities held by them at any time.
(b) The Trustee and the Paying Agent shall pay to the Company upon
request any money held by them for the payment of principal or interest that
remains unclaimed for three years. After that, Securityholders entitled to the
money must look to the Company for payment as general creditors unless an
abandoned property law designates another person.
SECTION 8.04. Indemnity for Government Obligations.
The Company shall pay and shall indemnify the Trustee and each
Securityholder of each Series in respect of which the deposit shall have been
made against any tax, fee or other charge imposed on or assessed against
deposited U.S. Government Obligations or the principal and interest received on
such obligations.
ARTICLE 9
AMENDMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.
The Company and the Trustee may enter into one or more supplemental
indentures without consent of any Securityholder for any of the following
purposes:
(1) to cure any ambiguity, defect or inconsistency herein or in
the Securities of any Series;
<PAGE>
37
(2) to comply with Article 5;
(3) to provide for uncertificated Securities in addition to or in
place of certificated Securities;
(4) to make any change that does not adversely affect the rights
of any Securityholder; or
(5) to provide for the issuance of and establish the form and
terms and conditions of Securities of any Series as provided in Section
2.02, to establish the form of any certifications required to be furnished
pursuant to the terms of this Indenture or any Series of Securities, or to
add to the rights of the Holders of any Series of Securities.
SECTION 9.02. With Consent of Holders.
(a) With the written consent of the Holders of a majority in
principal amount of the outstanding Securities of each Series affected by such
supplemental indenture (with each Series voting as a class), the Company and the
Trustee may enter into a supplemental indenture to add any provisions to or to
change or eliminate any provisions of this Indenture or of any supplemental
indenture or to modify, in each case in any manner not covered by Section 9.01,
the rights of the Securityholders of each such Series. The Holders of a majority
in principal amount of the outstanding Securities of each Series affected by
such waiver (with each Series voting as a class), by notice to the Trustee, may
waive compliance by the Company with any provision of this Indenture, any
supplemental indenture or the Securities of any such Series except a Default in
the payment of the principal of or interest on any Security. However, without
the consent of each Securityholder affected, an amendment or waiver may not:
(1) reduce the amount of Securities whose Holders must consent to
an amendment or waiver;
(2) change the rate of or change the time for payment of interest
on any Security;
(3) change the principal of or change the fixed maturity of any
Security;
(4) waive a Default in the payment of the principal of or interest
on any Security;
(5) make any Security payable in money other than that stated in
the Security; or
(6) make any change in Section 6.04, 6.07 or 9.02(a) (third
sentence).
(b) It is not necessary under this Section 9.02 for the
Securityholders to consent to the particular form of any proposed supplemental
indenture, but it is sufficient if they consent to the substance thereof.
<PAGE>
38
(c) Promptly after the execution by the Company and the Trustee of
any supplemental indenture pursuant to the provisions of this Section 9.02, the
Company shall transmit by mail a notice, setting forth in general terms the
substance of such supplemental indenture, to all Holders of Registered
Securities, as the names and addresses of such Holders appear on the register
for each Series of Securities, and to such Holders of Unregistered Securities as
are entitled to receive reports pursuant to Section 4.05(c). Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture.
SECTION 9.03. Compliance with Trust Indenture Act.
Every amendment to this Indenture or the Securities of one or more
Series shall be set forth in a supplemental indenture that complies with the TIA
as then in effect.
SECTION 9.04. Revocation and Effect of Consents.
Until an amendment or waiver becomes effective, a consent to it by a
Holder of a Security is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his Security or portion of a Security if the Trustee receives the
notice of revocation before the date the amendment or waiver becomes effective.
After an amendment or waiver becomes effective, it shall bind every
Securityholder of each Series affected by such amendment or waiver.
SECTION 9.05. Notation on or Exchange of Securities.
The Trustee may place an appropriate notation about an amendment or
waiver on any Security of any Series thereafter authenticated. The Company in
exchange for Securities of that Series may issue and the Trustee shall
authenticate new Securities of that Series that reflect the amendment or waiver.
SECTION 9.06. Trustee Protected.
The Trustee need not sign any supplemental indenture that will
materially and adversely affect the Trustee's own rights, duties or immunities
under the Securities and this Indenture or otherwise in a manner which is not
reasonably acceptable to the Trustee.
<PAGE>
39
ARTICLE 10
MISCELLANEOUS
SECTION 10.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies, or conflicts
with the duties imposed by any of TIA ss.ss. 310 through 317, inclusive, through
the operation of ss. 318(c) thereof, such imposed duties shall control.
SECTION 10.02. Notices.
(a) Any notice or communication by the Company or the Trustee to
the other is duly given if in writing and delivered in person or mailed by
first-class mail:
if to the Company to:
New York Telephone Company
1095 Avenue of the Americas
New York, New York 10036
Attention: Treasurer
if to the Trustee to:
The Chase Manhattan Bank
270 Park Avenue
New York, New York 10017
Attention: Global Trust Services
(b) The Company or the Trustee by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
(c) Any notice or communication to Holders of Securities entitled
to receive reports pursuant to Section 4.05(c) shall be mailed by first-class
mail to the addresses for Holders of Registered Securities shown on the register
kept by the Registrar and to addresses filed with the Trustee for other Holders.
Failure to so mail a notice or communication or any defect in such notice or
communication shall not affect its sufficiency with respect to other Holders of
Securities of that or any other Series entitled to receive notice.
(d) If a notice or communication is mailed in the manner provided
above within the time prescribed, it is conclusively presumed to have been duly
given, whether or not the addressee receives it.
(e) If the Company mails a notice or communication to
Securityholders, it shall mail a copy to the Trustee and to each Agent at the
same time.
<PAGE>
40
(f) If it shall be impractical in the opinion of the Trustee or
the Company to make any publication of any notice required hereby in an
Authorized Newspaper, any publication or other notice in lieu thereof which is
made or given with the approval of the Trustee shall constitute a sufficient
publication of such notice.
SECTION 10.03. Communication by Holders with Other Holders.
Securityholders of any Series may communicate pursuant to TIA ss.
312(b) with other Securityholders of that Series or of all Series with respect
to their rights under this Indenture or under the Securities of that Series or
of all Series. The Company, the Trustee, the Registrar and anyone else shall
have the protection of TIA ss. 312(c).
SECTION 10.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to
take any action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
SECTION 10.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that the person making such certificate or opinion
has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such person, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.
<PAGE>
41
SECTION 10.06. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by, or a meeting
of, Securityholders of one or more Series. The Paying Agent or Registrar may
make reasonable rules and set reasonable requirements for its functions.
SECTION 10.07. Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday, or a day on which banking
institutions are not required to be open. If a payment date is a Legal Holiday
at a place of payment, payment may be made at such place on the next succeeding
day that is not a Legal Holiday, and no interest shall accrue for the
intervening period.
SECTION 10.08. Governing Law.
The laws of the State of New York shall govern this Indenture, the
Securities and any coupons appertaining thereto.
SECTION 10.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan
or debt agreement of the Company or an Affiliate. No such indenture, loan or
debt agreement may be used to interpret this Indenture.
SECTION 10.10. No Recourse Against Others.
No director, officer, employee or stockholder, as such, of the
Company shall have any liability for any obligations of the Company under the
Securities or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. Each Securityholder by accepting a
Security waives and releases all such liability. The waiver and release are part
of the consideration for the issue of the Securities.
<PAGE>
42
SECTION 10.11. Execution in Counterparts.
This Indenture may be executed in any number of counterparts, each
of which shall be an original but such counterparts shall together constitute
but one instrument.
NEW YORK TELEPHONE COMPANY
By: /s/ Ellen C Wolf
--------------------
Title: Treasurer
(SEAL)
Attest: /s/ Darlene D. Kleiner
- ------------------------------
Title: Assistant Secretary
THE CHASE MANHATTAN BANK
By: /s/ Gemmel Richards
--------------------
Title: Trust Officer
(SEAL)
Attest: /s/ Patricia Marshall
- ------------------------------
Title: Assistant Secretary
<PAGE>
EXHIBIT A
CERTIFICATE
FORM OF CERTIFICATE TO BE GIVEN BY PERSON
ENTITLED TO RECEIVE UNREGISTERED SECURITY
[Insert Title or Sufficient Description of
Securities to be Delivered]
(the "Securities")
This is to certify that as of the date hereof, and except as set
forth below, the above-captioned Securities held by you for our account (i) are
owned by persons that are not citizens or residents of the United States,
domestic partnerships, domestic corporations, any estate the income of which is
subject to the United States federal income taxation regardless of its source or
a trust if a court within the United States is able to exercise primary
supervision over the administration of such trust and one or more United States
persons as described in Section 7701(a)(30) of the Code (as defined below) have
the authority to control all of the substantial decisions of such trust ("United
States persons"), (ii) are owned by United States person(s) that (a) are foreign
branches of a United States financial institution (as defined in the U.S.
Treasury Regulations Section 1.165-12(c)(1)(v) ("financial institutions")
purchasing for their own account or for resale, or (b) acquired the Securities
through foreign branches of United States financial institutions and who hold
the Securities through such United States financial institutions on the date
hereof (and in either case (a) or (b), each such United States financial
institution hereby agrees, on its own behalf or through its agent, that you may
advise the issuer or the issuer's agent that it will comply with the
requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of
1986, as amended, and the regulations thereunder(the "Code")), or (iii) are
owned by United States or foreign financial institution(s) for purposes of
resale during the restricted period (as defined in U.S. Treasury Regulations
Section 1.163-5(c)(2)(i)(D)(7)), and in addition if the owner of the Securities
is a United States or foreign financial institution described in clause (iii)
above (whether or not also described in clause (i) or (ii)) this is to further
certify that such financial institution has not acquired the Securities for
purposes of resale directly or indirectly to a United States person or to a
person within the United States or its possessions.
As used herein, "United States" means the United States of America
(including the States and the District of Columbia); and its "possessions"
include Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island
and the Northern Mariana Islands.
We undertake to advise you promptly by tested telex on or prior to
the date on which you intend to submit your certification relating to the
Securities held by you for our account in accordance with your operating
procedures if any applicable statement herein is not correct on such date, and
in the absence of any such notification it may be assumed that this
certification applies as of such date.
This certification excepts and does not relate to $______________ of
such interest in the above Securities in respect of which we are not able to
certify and as to which we
<PAGE>
2
understand exchange and delivery of definitive Securities (or, if relevant,
exercise of any rights or collection of any interest) cannot be made until we do
so certify.
We understand that this certification is required in connection with
certain tax laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certification is or would be relevant, we irrevocably authorize
you to produce this certification to any interested party in such proceedings.
Date: _____________, 19__(1)
By:
-------------------------------------------------
As, or as agent for, the beneficial owner(s) of
the Securities to which this certificate relates.
- ----------
(1) Not earlier than 15 days prior to the Exchange Date or Interest Payment
Date to which the certification relates.
<PAGE>
EXHIBIT B
CERTIFICATE
FORM OF CERTIFICATE TO BE GIVEN
BY EURO-CLEAR OR CEDEL
[Insert title or sufficient description
of Securities to be delivered]
(the "Securities")
This is to certify that, based solely on certifications we have
received in writing, by tested telex or by electronic transmission from member
organizations appearing in our records as persons being entitled to a portion of
the principal amount of the above-captioned Securities as of the date hereof,
_______________________ principal amount of these Securities (i) is owned by
persons that are not citizens or residents of the United States, domestic
partnerships, domestic corporations, any estate the income of which is subject
to United States federal income taxation regardless of its source or a trust if
a court within the United States is able to exercise primary supervision over
the administration of such trust and one or more United States persons as
described in Section 7701(a)(30) of the Code (as defined below) have the
authority to control all of the substantial decisions of such trust ("United
States persons"), (ii) is owned by United States persons that (a) are foreign
branches of United States financial institutions (as defined in U.S. Treasury
Regulations Section 1.165-12(c)(1)(v) ("financial institutions")) purchasing for
their own account or for resale, or (b) acquired the Securities through foreign
branches of United States financial institutions and who hold the Securities
through such United States financial institutions on the date hereof (and in
either case (a) or (b), each such United States financial institution has
agreed, on its own behalf or through its agent, that we may advise the Issuer or
the Issuer's agent that it will comply with the requirements of Section
165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and
the regulations thereunder (the "Code")), or (iii) is owned by United States or
foreign financial institutions for purposes of resale during the restricted
period (as defined in U.S. Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7)),
and to the further effect that United States or foreign financial institutions
described in clause (iii) above (whether or not also described in clause (i) or
(ii)) have certified that they have not acquired the Securities for purposes of
resale directly or indirectly to a United States person or to a person within
the United States or its possessions.
We further certify (i) that we are not making available herewith for
exchange (or, if relevant, exercise of any rights or collection of any interest)
any portion of the Temporary Global Security excepted in such certifications and
(ii) that as of the date hereof we have not received any notification from any
of our Member Organizations to the effect that the statements made by such
Member Organizations with respect to any such portion of the part submitted
herewith for exchange (or, if relevant, exercise of any rights or collection of
any interest) are no longer true and cannot be relied upon as of the date
hereof.
<PAGE>
2
As used herein, "United States" means the United States of America
(including the States and the District of Columbia); and its "possessions"
include Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island
and the Northern Mariana Islands.
We understand that this certification is required in connection with
certain tax laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certification is or would be relevant, we irrevocably authorize
you to produce this certification to any interested party in such proceedings.
Date: _____________, 19__(2)
By: _________________________
- --------
(2) Not earlier than the relevant Exchange Date or Interest Payment Date to
which the certification relates.
EXHIBIT 5
Bell Atlantic
1095 Avenue of the Americas
New York, NY 10036
37th Floor
Tel 212 395-6515
Fax 212 768-7568
Sandra DiIorio Thorn
General Counsel
LOGO
February 5, 1998
New York Telephone Company
1095 Avenue of the Americas
New York, New York 10036
Re: Registration Statement
on Form S-3 under the Securities Act of 1933
--------------------------------------------
Ladies and Gentlemen:
Reference is made to the Registration Statement on Form S-3 (the
"Registration Statement") which New York Telephone Company, a New York
corporation (the "Company"), is filing with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, registering one or more
series of up to $750,000,000 of aggregate principal amount of debt securities
(the "Securities") of the Company, to be issued under an Indenture dated as of
February 1, 1998 from the Company to The Chase Manhattan Bank, Trustee.
I am General Counsel of the Company. I or members of my staff have
reviewed the Registration Statement, the Company's Certificate of Incorporation
and By-Laws, resolutions adopted by the Board of Directors of the Company, and
such other documents and records as deemed appropriate for the purpose of giving
this opinion.
Based upon the foregoing, it is my opinion that:
1. The Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of
New York.
2. The execution and delivery of the Indenture has been duly
authorized by the Company by appropriate corporate action, and
assuming due authorization, execution and delivery thereof by
the Trustee, the Indenture is a valid and binding agreement in
accordance with its terms;
3. Upon issuance of the Securities, in accordance with the terms
of the resolutions relating thereto of the Board of Directors
of the Company and the Indenture, and receipt of payment
therefor, and in accordance
<PAGE>
New York Telephone Company
Page 2
with the terms of legally required consents, approvals,
authorizations and other orders of the Securities and Exchange
Commission and any other regulatory authorities, the
Securities will be legally issued and binding obligations of
the Company.
I hereby consent to the filing of this opinion with the Securities and
Exchange Commission in connection with the Registration Statement and to being
named under the heading "Legal Matters" in the Registration Statement.
Very truly yours,
/s/ Sandra DiIorio Thorn
------------------------
Sandra DiIorio Thorn
[Coopers & Lybrand L.L.P. Letterhead]
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statement of
New York Telephone Company on this Form S-3 of our report dated February 7,
1997, except as to the information presented in Note U, for which the date is
August 14, 1997, on our audits of the consolidated financial statements of New
York Telephone Company as of December 31, 1996 and 1995, and for the years ended
December 31, 1996, 1995, and 1994. We also consent to the reference to our firm
under the caption "Experts" in this registration statement.
Coopers & Lybrand L.L.P.
1301 Avenue of the Americas
New York, New York
February 6, 1998
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ivan G.
Seidenberg, Ellen C. Wolf and Edwin F. Hall as attorney for the undersigned
for the purpose of executing and filing such registration statement and any
amendment or amendments or other necessary documents, hereby giving to each said
attorney full authority to perform all acts necessary thereto as fully as the
undersigned could do if personally present, and hereby ratifying all that said
attorney may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 27th day of January, 1998.
/s/ Richard L. Carrion
----------------------
Richard L. Carrion
<PAGE>
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ivan G.
Seidenberg, Ellen C. Wolf and Edwin F. Hall as attorney for the undersigned for
the purpose of executing and filing such registration statement and any
amendment or amendments or other necessary documents, hereby giving to each said
attorney full authority to perform all acts necessary thereto as fully as the
undersigned could do if personally present, and hereby ratifying all that said
attorney may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 27th day of January, 1998.
/s/ Stanley P. Goldstein
------------------------
Stanley P. Goldstein
<PAGE>
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ivan G.
Seidenberg, Ellen C. Wolf and Edwin F. Hall as attorney for the undersigned for
the purpose of executing and filing such registration statement and any
amendment or amendments or other necessary documents, hereby giving to each said
attorney full authority to perform all acts necessary thereto as fully as the
undersigned could do if personally present, and hereby ratifying all that said
attorney may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 27th day of January, 1998.
/s/ Helene L. Kaplan
--------------------
Helene L. Kaplan
<PAGE>
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ivan G.
Seidenberg, Ellen C. Wolf and Edwin F. Hall as attorney for the undersigned for
the purpose of executing and filing such registration statement and any
amendment or amendments or other necessary documents, hereby giving to each said
attorney full authority to perform all acts necessary thereto as fully as the
undersigned could do if personally present, and hereby ratifying all that said
attorney may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 27th day of January, 1998.
/s/ Elizabeth T. Kennan
-----------------------
Elizabeth T. Kennan
<PAGE>
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ivan G.
Seidenberg, Ellen C. Wolf and Edwin F. Hall as attorney for the undersigned for
the purpose of executing and filing such registration statement and any
amendment or amendments or other necessary documents, hereby giving to each said
attorney full authority to perform all acts necessary thereto as fully as the
undersigned could do if personally present, and hereby ratifying all that said
attorney may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 27th day of January, 1998.
/s/ John F. Maypole
-------------------
John F. Maypole
<PAGE>
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ivan G.
Seidenberg, Ellen C. Wolf and Edwin F. Hall as attorney for the undersigned for
the purpose of executing and filing such registration statement and any
amendment or amendments or other necessary documents, hereby giving to each said
attorney full authority to perform all acts necessary thereto as fully as the
undersigned could do if personally present, and hereby ratifying all that said
attorney may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 27th day of January, 1998.
/s/ Joseph Neubauer
-------------------
Joseph Neubauer
<PAGE>
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ivan G.
Seidenberg, Ellen C. Wolf and Edwin F. Hall as attorney for the undersigned for
the purpose of executing and filing such registration statement and any
amendment or amendments or other necessary documents, hereby giving to each said
attorney full authority to perform all acts necessary thereto as fully as the
undersigned could do if personally present, and hereby ratifying all that said
attorney may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 27th day of January, 1998.
/s/ Hugh B. Price
-----------------
Hugh B. Price
<PAGE>
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ellen C.
Wolf and Edwin F. Hall as attorney for the undersigned for the purpose of
executing and filing such registration statement and any amendment or amendments
or other necessary documents, hereby giving to each said attorney full authority
to perform all acts necessary thereto as fully as the undersigned could do if
personally present, and hereby ratifying all that said attorney may lawfully do
or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 27th day of January, 1998.
/s/ Ivan G. Seidenberg
----------------------
Ivan G. Seidenberg
<PAGE>
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ivan G.
Seidenberg, Ellen C. Wolf and Edwin F. Hall as attorney for the undersigned for
the purpose of executing and filing such registration statement and any
amendment or amendments or other necessary documents, hereby giving to each said
attorney full authority to perform all acts necessary thereto as fully as the
undersigned could do if personally present, and hereby ratifying all that said
attorney may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 27th day of January, 1998.
/s/ Walter V. Shipley
---------------------
Walter V. Shipley
<PAGE>
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ivan G.
Seidenberg, Ellen C. Wolf and Edwin F. Hall as attorney for the undersigned for
the purpose of executing and filing such registration statement and any
amendment or amendments or other necessary documents, hereby giving to each said
attorney full authority to perform all acts necessary thereto as fully as the
undersigned could do if personally present, and hereby ratifying all that said
attorney may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 27th day of January, 1998.
/s/ John R. Stafford
--------------------
John R. Stafford
<PAGE>
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ivan G.
Seidenberg, Ellen C. Wolf and Edwin F. Hall as attorney for the undersigned for
the purpose of executing and filing such registration statement and any
amendment or amendments or other necessary documents, hereby giving to each said
attorney full authority to perform all acts necessary thereto as fully as the
undersigned could do if personally present, and hereby ratifying all that said
attorney may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 27th day of January, 1998.
/s/ Lodewijk J.R. de Vink
-------------------------
Lodewijk J.R. de Vink
<PAGE>
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ivan G.
Seidenberg and Edwin F. Hall as attorney for the undersigned for the purpose of
executing and filing such registration statement and any amendment or amendments
or other necessary documents, hereby giving to each said attorney full authority
to perform all acts necessary thereto as fully as the undersigned could do if
personally present, and hereby ratifying all that said attorney may lawfully do
or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 4th day of February, 1998.
/s/ Doreen A. Toben
-------------------
Doreen A. Toben
<PAGE>
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ivan G.
Seidenberg and Doreen A. Toben as attorney for the undersigned for the purpose
of executing and filing such registration statement and any amendment or
amendments or other necessary documents, hereby giving to each said attorney
full authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 4th day of February, 1998.
/s/ Edwin F. Hall
-----------------
Edwin F. Hall
<PAGE>
POWER OF ATTORNEY
WHEREAS, NEW YORK TELEPHONE COMPANY, a New York corporation
(hereinafter referred to as the "Company"), proposes to file with the Securities
and Exchange Commission under the provisions of the Securities Act of 1933, as
amended, a registration statement on Form S-3 with respect to the issuance and
sale of up to $750,000,000 aggregate principal amount of debt securities of the
Company;
NOW, THEREFORE, the undersigned hereby appoints each of Ivan G.
Seidenberg and Edwin F. Hall as attorney for the undersigned for the purpose of
executing and filing such registration statement and any amendment or amendments
or other necessary documents, hereby giving to each said attorney full authority
to perform all acts necessary thereto as fully as the undersigned could do if
personally present, and hereby ratifying all that said attorney may lawfully do
or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 27th day of January, 1998.
/s/ Ellen C. Wolf
-----------------
Ellen C. Wolf
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
----------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
---------------------------------------------
New York Telephone Company
(Exact name of obligor as specified in its charter)
New York 13-5275510
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
1095 Avenue of the Americas
New York, New York 10036
(Address of principal executive offices) (Zip Code)
---------------------------------------------
Debt Securities
---------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject. New York State Banking Department, State
House, Albany, New York 12110. Board of Governors of the Federal
Reserve System, Washington, D.C., 20551 Federal Reserve Bank of
New York, District No. 2, 33 Liberty Street, New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now in
effect, including the Organization Certificate and the Certificates of Amendment
dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being
contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to
Form T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act
(see Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, a corporation organized and existing under
the laws of the State of New York, has duly caused this statement of eligibility
to be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of New York and State of New York, on the 1st day of February, 1998.
THE CHASE MANHATTAN BANK
By /s/ Gemmel Richards
----------------------------
Gemmel Richards, Trust Officer
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business September 30, 1997, in accordance
with a call made by the Federal Reserve Bank of this District
pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin ................................................$ 11,760
Interest-bearing balances ........................................ 4,343
Securities: ............................................... ..........
Held to maturity securities............................................ 2,704
Available for sale securities.......................................... 37,885
Federal funds sold and securities purchased under
agreements to resell ............................................. 27,358
Loans and lease financing receivables:
Loans and leases, net of unearned income $127,370
Less: Allowance for loan and lease losses 2,760
Less: Allocated transfer risk reserve ......... 13
----------
Loans and leases, net of unearned income,
allowance, and reserve ........................................... 124,597
Trading Assets ........................................................ 64,630
Premises and fixed assets (including capitalized leases)............... 2,925
Other real estate owned ............................................... 286
Investments in unconsolidated subsidiaries and
associated companies.............................................. 232
Customers' liability to this bank on acceptances
outstanding ...................................................... 2,212
Intangible assets ..................................................... 1,480
Other assets .......................................................... 11,117
TOTAL ASSETS .......................................................... $291,529
========
- 4 -
<PAGE>
LIABILITIES
Deposits
In domestic offices .............................................. $86,574
Noninterest-bearing .............................................. $31,818
Interest-bearing ................................................. 54,756
In foreign offices, Edge and Agreement subsidiaries,
and IBF's ........................................................ 69,887
Noninterest-bearing .............................................. $ 3,777
Interest-bearing ................................................. 66,110
Federal funds purchased and securities sold under agreements
to repurchase ........................................................ 45,307
Demand notes issued to the U.S. Treasury .............................. 161
Trading liabilities ................................................... 47,406
Otherborrowed money (includes mortgage indebtedness and obligations under
capitalized leases):
With a remaining maturity of one year or less .................... 4,578
With a remaining maturity of more than one year .
through three years........................................ 261
With a remaining maturity of more than three years............... 131
Bank's liability on acceptances executed and outstanding............... 2,212
Subordinated notes and debentures ..................................... 5,715
Other liabilities...................................................... 12,355
TOTAL LIABILITIES ..................................................... 274,587
EQUITY CAPITAL
Perpetual preferred stock and related surplus.......................... 0
Common stock .......................................................... 1,211
Surplus (exclude all surplus related to preferred stock).............. 10,294
Undivided profits and capital reserves ................................ 5,414
Net unrealized holding gains (losses)
on available-for-sale securities ..................................... 7
Cumulative foreign currency translation adjustments ................... 16
TOTAL EQUITY CAPITAL .................................................. 16,942
--------
OTAL LIABILITIES AND EQUITY CAPITAL ................................... $291,529
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us, and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
