<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
February 14, 2000
BELLSOUTH CORPORATION
(Exact name of registrant as specified in its charter)
Georgia 1-8607 58-1533433
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) No.)
1155 Peachtree Street, N. E., Atlanta, Georgia 30309-3610
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code
(404) 249-2000
<PAGE> 2
Item 7. Financial Statements and Exhibits
The following are filed as Exhibits to the Registrant's Registration Statements
(File No. 333-45607 and 333-77053)
4-g Form of Note due 2010
4-h Form of Debenture due 2030
<PAGE> 3
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BELLSOUTH CORPORATION
BY: W. Patrick Shannon
Vice President and Controller
February 15, 2000
<PAGE> 1
EXHIBIT 4-g
[Form of Note]
[Face]
[LEGEND TO BE INSERTED ON OFFERED SECURITIES: Unless this certificate is
presented by an authorized representative of The Depository Trust Company, a New
York corporation ("DTC"), to the issuer or its agent for registration of
transfer, exchange or payment, and any certificate issued is registered in the
name of Cede & Co. or such other name as is requested by an authorized
representative of The Depository Trust Company (and any payment is made to Cede
& Co. or to such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an
interest herein.]
No. - $-
CUSIP No. 079857AG3
BELLSOUTH CAPITAL FUNDING CORPORATION
$1,000,000,000 Ten Year 7 3/4% Notes Due 2010
BellSouth Capital Funding Corporation, a Georgia corporation (herein
referred to as the "COMPANY"), for value received, hereby promises to pay to -,
or registered assigns, the principal sum of - ($-) Dollars on February 15, 2010,
at the office or agency of the Company in the City of New York, New York, in
such coin or currency of the United States of America as at the time of payment
shall be legal tender for the payment of public and private debts, and to pay
interest, on February 15 and August 15 (each, an "INTEREST PAYMENT DATE"),
commencing August 15, 2000, on said principal sum at the rate per annum
specified in the title of this Note, at said office or agency, in like coin or
currency, from the most recent Interest Payment Date to which interest on the
Notes has been paid preceding the date hereof (unless the date hereof is an
Interest Payment Date to which interest has been paid, in which case from the
date hereof, or unless the date hereof is prior to the first payment of
interest, in which case from February 16, 2000) until payment of said principal
sum has been made or duly provided for. The interest so payable on any Interest
Payment Date, and punctually paid or duly provided for, will, as provided in the
Indenture referred to on the reverse hereof, be paid to the person in whose name
this Note (or any predecessor Note) shall be registered at the close of business
on the February 1 prior to such February 15 or the August 1 prior to such August
15 (each such date, a "REGULAR RECORD DATE"), as the case may be, unless such
Regular Record Date shall not be a business day (which shall be any day other
than a "Legal Holiday" as defined in said Indenture), in which event the
business day next preceding. Any such interest not so punctually paid or duly
provided for will forthwith cease to be payable to the Holder on such Regular
Record Date and may either be paid to the Person in whose name this Note (or one
or more predecessor Notes) is registered at the close of business on a special
record date (a "SPECIAL RECORD DATE") for the payment of such Defaulted Interest
to be fixed by the Trustee, notice whereof shall be given to Holders of Notes of
this series not less than 15 days prior to such Special Record Date, or be paid
at any time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Notes of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture.
So long as this Note is registered in the name of Cede & Co., payments
of interest hereon shall be made in immediately available funds; otherwise,
payments of interest may be made at the option of the Company by check or draft
mailed to the address of the person entitled thereto at such address as shall
appear on the Note register.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof and such further provisions shall for all purposes
have the same effect as though fully set forth in this place.
<PAGE> 2
This Note shall not be valid or become obligatory for any purpose
until the appropriate certificate of authentication hereon shall have been
executed by or on behalf of the Trustee under the Indenture referred to on the
reverse hereof.
IN WITNESS WHEREOF, BellSouth Capital Funding Corporation has caused
this Instrument to be signed by its President or one of its Vice Presidents and
by its Treasurer, an Assistant Treasurer, Secretary or Assistant Secretary, each
by a facsimile of his signature, and has caused a facsimile of its corporate
seal to be affixed hereunto or imprinted hereon.
Dated -
BELLSOUTH CAPITAL FUNDING
CORPORATION
-----------------------------------
Name:
Title:
-----------------------------------
Name:
Title:
[Seal]
2
<PAGE> 3
[Form of Certificate of Authentication]
This is one of the Notes described in the within-mentioned Indenture.
THE BANK OF NEW YORK, as Trustee
By:
-----------------------------------
Authorized Signatory:
3
<PAGE> 4
[Form of Note]
[Reverse]
BELLSOUTH CAPITAL FUNDING CORPORATION
This Note is one of a duly authorized series of Notes of the Company,
designated as set forth on the face hereof (including the Additional Notes
referred to below, herein referred to as the "NOTES"), initially limited to the
aggregate principal amount of $1,000,000,000, all issued or to be issued under
and pursuant to an indenture dated as of August 1, 1992 (the "INDENTURE"), duly
executed and delivered by the Company and BellSouth Corporation ("BELLSOUTH") to
The Bank of New York, as successor to Wachovia Bank of Georgia, N.A., as trustee
(herein referred to as the "TRUSTEE"), to which Indenture and all indentures
supplemental thereto reference is hereby made for a description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the
Trustee, the Company, BellSouth and the Holders (the words "HOLDERS" or "HOLDER"
meaning the registered holders or registered holder) of the Notes and the terms
upon which the Notes are to be authenticated and delivered. All of the Notes
will have the benefit of a Support Agreement dated as of October 15, 1987, as
amended as of August 1, 1992 (the "SUPPORT AGREEMENT"), between the Company and
BellSouth. In the Support Agreement, BellSouth has agreed to ensure the timely
payment of principal and interest owed on the Notes; however, no Holder will
have recourse to or against the stock or assets of BellSouth Telecommunications,
Inc. (the "TELEPHONE COMPANY") or any interest of BellSouth or the Company in
the Telephone Company.
The Company may issue additional notes (the "ADDITIONAL NOTES") under
the Indenture having the same terms in all respects as the Notes (or in all
respects except for the payment of interest on the Notes (i) scheduled and paid
prior to the date of issuance of such Additional Notes or (ii) payable on the
first Interest Payment Date following such date of issuance). Such Additional
Notes shall be treated as part of the same series as the Notes for all purposes
under the Indenture and shall vote together with the Notes as part of the same
class.
In case an Event of Default, as defined in the Indenture, with respect
to the Notes shall have occurred and be continuing, the principal hereof may be
declared, and upon such declaration, shall become due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Notes at any time by the Company
and the Trustee with the consent of the Holders of a majority in principal
amount of the Notes. The Indenture also contains provisions permitting the
Holders of not less than a majority in principal amount of the outstanding
Notes, on behalf of the Holders of all Notes, to waive compliance by the Company
with certain provisions of the Indenture. The Indenture also provides that the
Holders of not less than a majority in principal amount of the outstanding Notes
may waive certain past defaults and their consequences on behalf of the Holders
of all Notes. Any such consent or waiver by the Holder of this Note shall be
conclusive and binding upon such Holder and upon all future Holders of this Note
and of any Note issued upon the registration of transfer hereof or in exchange
herefor or in lieu hereof whether or not notation of such consent or waiver is
made upon this Note.
The Indenture contains provisions setting forth certain conditions in
the institution of proceedings by Holders of Notes with respect to the Indenture
or for any remedy under the Indenture.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the place, at the respective times, at the rate and in the coin or currency
herein prescribed.
The Notes are issuable as registered Notes without coupons in
denominations of $1,000 or any amount in excess thereof which is an integral
multiple of $1,000. At the office or agency of the Company designated for such
purpose and in the manner and subject to the limitations provided in the
Indenture, Notes may be exchanged without
4
<PAGE> 5
a service charge for a like aggregate principal amount of Notes of other
authorized denominations having the same maturity, interest rate, redemption
provisions and original issue date.
The Notes may be redeemed in whole at any time or in part from time to
time, at the election of the Company, at a redemption price equal to the greater
of (i) 100% of the principal amount of the Notes to be redeemed, or (ii) the sum
of the present values of the remaining scheduled payments of principal and
interest on the Notes to be redeemed, discounted to the date of redemption on a
semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
at the applicable Treasury Rate (as defined below) plus 15 basis points, plus,
in each case, accrued and unpaid interest on the principal amount being redeemed
to the redemption date.
"Treasury Rate" means, with respect to any redemption date, (1) the
yield, under the heading which represents the average for the immediately
preceding week, appearing in the most recently published statistical release
designated "H.15(519)" or any successor publication which is published weekly by
the Board of Governors of the Federal Reserve System and which establishes
yields on actively traded United States Treasury securities adjusted to constant
maturity under the caption "Treasury Constant Maturities," for the maturity
corresponding to the Comparable Treasury Issue (or, if no maturity is within
three months before or after the Remaining Life, yields for the two published
maturities most closely corresponding to the Comparable Treasury Issue will be
determined and the Treasury Rate will be interpolated or extrapolated from such
yields on a straight line basis, rounding to the nearest month) or (2) if such
release (or any successor release) is not published during the week preceding
the calculation date or does not contain such yields, the rate per annum equal
to the semi-annual equivalent yield-to-maturity of the Comparable Treasury
Issue, calculated using a price for the Comparable Treasury Issue (expressed as
a percentage of its principal amount) equal to the Comparable Treasury Price of
such redemption date. The Treasury Rate will be calculated on the third Business
Day preceding the redemption date.
"Business Day" means any calendar day that is not a Saturday, Sunday
or legal holiday in New York, New York and on which commercial banks are open
for business in New York, New York.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity comparable to
the remaining term ("Remaining Life") of the Notes to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the Remaining Life of such Notes.
"Independent Investment Banker" means either Lehman Brothers Inc. or
Morgan Stanley & Co. Incorporated, and their respective successors, or, if both
firms are unwilling or unable to select the Comparable Treasury Issue, a
nationally recognized investment banking institution which is a Primary Treasury
Dealer appointed by the Company.
"Comparable Treasury Price" means (1) the average of five Reference
Treasury Dealer Quotations for such redemption date, after excluding the highest
and lowest Reference Treasury Dealer Quotations, or (2) if, after seeking at
least five Reference Treasury Dealer Quotations and excluding the highest and
lowest Reference Treasury Dealer Quotations, the Independent Investment Banker
obtains fewer than five such Reference Treasury Dealer Quotations, the average
of all such quotations.
"Reference Treasury Dealer" means (1) Lehman Brothers Inc. and Morgan
Stanley & Co. Incorporated, and their respective successors, provided, however,
that if any of the foregoing shall cease to be a primary U.S. government
securities dealer in New York City (a "Primary Treasury Dealer"), we will
substitute for such dealer another Primary Treasury Dealer and (2) any other
nationally recognized Primary Treasury Dealer selected by the Independent
Investment Banker and acceptable to the Company.
"The Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any redemption date, the average, as determined by
the Independent Investment Banker, of the bid and asked prices for the
Comparable Treasury Issue (expressed in each case as a percentage of its
principal amount) quoted in writing
5
<PAGE> 6
to the Independent Investment Banker at 5:00 p.m., New York City time, on the
third Business Day preceding such redemption date.
On or after the redemption date, interest will cease to accrue on the
Notes or any portion thereof called for redemption (unless the Company defaults
in the payment of the redemption price and accrued interest). On or before any
redemption date, the Company will deposit with a paying agent (or the trustee)
money sufficient to pay the redemption price and accrued interest on the Notes
to be redeemed on such date.
Notice of redemption will be given to the Holders of these Notes not
more than 60 nor fewer than 30 days prior to the date fixed for redemption.
If fewer than all of the Notes are to be redeemed, the Trustee will
select the particular Notes or portions thereof for redemption from the
outstanding Notes not previously called, pro rata or by lot or in such other
manner as the Company shall direct.
In the event of redemption of this Note in part only, a new Note or
Notes of this series and of like tenor for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation hereof.
Upon due presentment for registration of transfer of this Note at the
office or agency of the Company designated for such purpose, a new Note or Notes
of this series, of authorized denominations, for a like aggregate principal
amount, will be issued to the transferee as provided in, and subject to the
limitations in, the Indenture. No service charge shall be made for any such
transfer, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto.
The Company, the Trustee, any paying agent and any Note registrar may
deem and treat the Holder hereof as the absolute owner hereof (whether or not
this Note shall be overdue and notwithstanding any notation of ownership or
other writing hereon) for the purpose of receiving payment of or on account of
the principal hereof and, subject to the provisions on the face hereof, interest
hereon, and for all other purposes, and neither the Company nor the Trustee nor
any paying agent nor any Note registrar shall be affected by any notice to the
contrary.
No recourse shall be had for the payment of the principal of or the
interest on this Note, or for any claim based hereon, or otherwise in respect
hereof, or based on or in respect of the Indenture or any indenture supplemental
thereto, against any incorporator, shareholder, officer or director, as such,
past, present or future, of the Company or of any successor corporation, either
directly or through the Company or any successor corporation, whether by virtue
of any constitution, statute or rule of law or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issue hereof, expressly waived
and released.
This Note shall be deemed to be a contract made under the laws of the
State of New York and for all purposes shall be construed in accordance with the
laws of said State.
6
<PAGE> 1
EXHIBIT 4-h
[Form of Debenture]
[Face]
[LEGEND TO BE INSERTED ON OFFERED SECURITIES: Unless this certificate is
presented by an authorized representative of The Depository Trust Company, a New
York corporation ("DTC"), to the issuer or its agent for registration of
transfer, exchange or payment, and any certificate issued is registered in the
name of Cede & Co. or such other name as is requested by an authorized
representative of The Depository Trust Company (and any payment is made to Cede
& Co. or to such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an
interest herein.]
No. - $-
CUSIP No. 079857AH1
BELLSOUTH CAPITAL FUNDING CORPORATION
$1,000,000,000 Thirty Year 7 7/8% Debentures Due 2030
BellSouth Capital Funding Corporation, a Georgia corporation (herein
referred to as the "COMPANY"), for value received, hereby promises to pay to -,
or registered assigns, the principal sum of - ($-) Dollars on February 15, 2030,
at the office or agency of the Company in the City of New York, New York, in
such coin or currency of the United States of America as at the time of payment
shall be legal tender for the payment of public and private debts, and to pay
interest, on February 15 and August 15 (each, an "INTEREST PAYMENT DATE"),
commencing August 15, 2000, on said principal sum at the rate per annum
specified in the title of this Debenture, at said office or agency, in like coin
or currency, from the most recent Interest Payment Date to which interest on the
Debentures has been paid preceding the date hereof (unless the date hereof is an
Interest Payment Date to which interest has been paid, in which case from the
date hereof, or unless the date hereof is prior to the first payment of
interest, in which case from February 16, 2000) until payment of said principal
sum has been made or duly provided for. The interest so payable on any Interest
Payment Date, and punctually paid or duly provided for, will, as provided in the
Indenture referred to on the reverse hereof, be paid to the person in whose name
this Debenture (or any predecessor Debenture) shall be registered at the close
of business on the February 1 prior to such February 15 or the August 1 prior to
such August 15 (each such date, a "REGULAR RECORD DATE"), as the case may be,
unless such Regular Record Date shall not be a business day (which shall be any
day other than a "Legal Holiday" as defined in said Indenture), in which event
the business day next preceding. Any such interest not so punctually paid or
duly provided for will forthwith cease to be payable to the Holder on such
Regular Record Date and may either be paid to the Person in whose name this
Debenture (or one or more predecessor Debentures) is registered at the close of
business on a special record date (a "SPECIAL RECORD DATE") for the payment of
such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Debentures of this series not less than 15 days prior to
such Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Debentures of this series may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in said Indenture.
So long as this Debenture is registered in the name of Cede & Co.,
payments of interest hereon shall be made in immediately available funds;
otherwise, payments of interest may be made at the option of the Company by
check or draft mailed to the address of the person entitled thereto at such
address as shall appear on the Debenture register.
Reference is hereby made to the further provisions of this Debenture
set forth on the reverse hereof and such further provisions shall for all
purposes have the same effect as though fully set forth in this place.
<PAGE> 2
This Debenture shall not be valid or become obligatory for any purpose
until the appropriate certificate of authentication hereon shall have been
executed by or on behalf of the Trustee under the Indenture referred to on the
reverse hereof.
IN WITNESS WHEREOF, BellSouth Capital Funding Corporation has caused
this Instrument to be signed by its President or one of its Vice Presidents and
by its Treasurer, an Assistant Treasurer, Secretary or Assistant Secretary, each
by a facsimile of his signature, and has caused a facsimile of its corporate
seal to be affixed hereunto or imprinted hereon.
Dated -
BELLSOUTH CAPITAL FUNDING
CORPORATION
--------------------------------------
Name:
Title:
--------------------------------------
Name:
Title:
[Seal]
2
<PAGE> 3
[Form of Certificate of Authentication]
This is one of the Debentures described in the within-mentioned
Indenture.
THE BANK OF NEW YORK, as Trustee
By:
----------------------------------
Authorized Signatory:
3
<PAGE> 4
[Form of Debenture]
[Reverse]
BELLSOUTH CAPITAL FUNDING CORPORATION
This Debenture is one of a duly authorized series of Debentures of the
Company, designated as set forth on the face hereof (including the Additional
Debentures referred to below, herein referred to as the "DEBENTURES"), initially
limited to the aggregate principal amount of $1,000,000,000 all issued or to be
issued under and pursuant to an indenture dated as of August 1, 1992 (the
"INDENTURE"), duly executed and delivered by the Company and BellSouth
Corporation ("BELLSOUTH") to The Bank of New York, as successor to Wachovia Bank
of Georgia, N.A., as trustee (herein referred to as the "TRUSTEE"), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
description of the rights, limitations of rights, obligations, duties and
immunities thereunder of the Trustee, the Company, BellSouth and the Holders
(the words "HOLDERS" or "HOLDER" meaning the registered holders or registered
holder) of the Debentures and the terms upon which the Debentures are to be
authenticated and delivered. All of the Debentures will have the benefit of a
Support Agreement dated as of October 15, 1987, as amended as of August 1, 1992
(the "SUPPORT AGREEMENT"), between the Company and BellSouth. In the Support
Agreement, BellSouth has agreed to ensure the timely payment of principal and
interest owed on the Debentures; however, no Holder will have recourse to or
against the stock or assets of BellSouth Telecommunications, Inc. (the
"TELEPHONE COMPANY") or any interest of BellSouth or the Company in the
Telephone Company.
The Company may issue additional debentures (the "ADDITIONAL
DEBENTURES") under the Indenture having the same terms in all respects as the
Debentures (or in all respects except for the payment of interest on the
Debentures (i) scheduled and paid prior to the date of issuance of such
Additional Debentures or (ii) payable on the first Interest Payment Date
following such date of issuance). Such Additional Debentures shall be treated as
part of the same series as the Debentures for all purposes under the Indenture
and shall vote together with the Debentures as part of the same class.
In case an Event of Default, as defined in the Indenture, with respect
to the Debentures shall have occurred and be continuing, the principal hereof
may be declared, and upon such declaration, shall become due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Debentures at any time by the
Company and the Trustee with the consent of the Holders of a majority in
principal amount of the Debentures. The Indenture also contains provisions
permitting the Holders of not less than a majority in principal amount of the
outstanding Debentures, on behalf of the Holders of all Debentures, to waive
compliance by the Company with certain provisions of the Indenture. The
Indenture also provides that the Holders of not less than a majority in
principal amount of the outstanding Debentures may waive certain past defaults
and their consequences on behalf of the Holders of all Debentures. Any such
consent or waiver by the Holder of this Debenture shall be conclusive and
binding upon such Holder and upon all future Holders of this Debenture and of
any Debenture issued upon the registration of transfer hereof or in exchange
herefor or in lieu hereof whether or not notation of such consent or waiver is
made upon this Debenture.
The Indenture contains provisions setting forth certain conditions in
the institution of proceedings by Holders of Debentures with respect to the
Indenture or for any remedy under the Indenture.
No reference herein to the Indenture and no provision of this
Debenture or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
interest on this Debenture at the place, at the respective times, at the rate
and in the coin or currency herein prescribed.
4
<PAGE> 5
The Debentures are issuable as registered Debentures without coupons
in denominations of $1,000 or any amount in excess thereof which is an integral
multiple of $1,000. At the office or agency of the Company designated for such
purpose and in the manner and subject to the limitations provided in the
Indenture, Debentures may be exchanged without a service charge for a like
aggregate principal amount of Debentures of other authorized denominations
having the same maturity, interest rate, redemption provisions and original
issue date.
The Debentures may be redeemed in whole at any time or in part from
time to time, at the election of the Company, at a redemption price equal to the
greater of (i) 100% of the principal amount of the Debentures to be redeemed, or
(ii) the sum of the present values of the remaining scheduled payments of
principal and interest on the Debentures to be redeemed, discounted to the date
of redemption on a semi-annual basis (assuming a 360-day year consisting of
twelve 30-day months) at the applicable Treasury Rate (as defined below) plus 20
basis points, plus, in each case, accrued and unpaid interest on the principal
amount being redeemed to the redemption date.
"Treasury Rate" means, with respect to any redemption date, (1) the
yield, under the heading which represents the average for the immediately
preceding week, appearing in the most recently published statistical release
designated "H.15(519)" or any successor publication which is published weekly by
the Board of Governors of the Federal Reserve System and which establishes
yields on actively traded United States Treasury securities adjusted to constant
maturity under the caption "Treasury Constant Maturities," for the maturity
corresponding to the Comparable Treasury Issue (or, if no maturity is within
three months before or after the Remaining Life, yields for the two published
maturities most closely corresponding to the Comparable Treasury Issue will be
determined and the Treasury Rate will be interpolated or extrapolated from such
yields on a straight line basis, rounding to the nearest month) or (2) if such
release (or any successor release) is not published during the week preceding
the calculation date or does not contain such yields, the rate per annum equal
to the semi-annual equivalent yield-to-maturity of the Comparable Treasury
Issue, calculated using a price for the Comparable Treasury Issue (expressed as
a percentage of its principal amount) equal to the Comparable Treasury Price of
such redemption date. The Treasury Rate will be calculated on the third Business
Day preceding the redemption date.
"Business Day" means any calendar day that is not a Saturday, Sunday
or legal holiday in New York, New York and on which commercial banks are open
for business in New York, New York.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity comparable to
the remaining term ("Remaining Life") of the Debentures to be redeemed that
would be utilized, at the time of selection and in accordance with customary
financial practice, in pricing new issues of corporate debt securities of
comparable maturity to the Remaining Life of such Debentures.
"Independent Investment Banker" means either Lehman Brothers Inc. or
Morgan Stanley & Co. Incorporated, and their respective successors, or, if both
firms are unwilling or unable to select the Comparable Treasury Issue, a
nationally recognized investment banking institution which is a Primary Treasury
Dealer appointed by the Company.
"Comparable Treasury Price" means (1) the average of five Reference
Treasury Dealer Quotations for such redemption date, after excluding the highest
and lowest Reference Treasury Dealer Quotations, or (2) if, after seeking at
least five Reference Treasury Dealer Quotations and excluding the highest and
lowest Reference Treasury Dealer Quotations, the Independent Investment Banker
obtains fewer than five such Reference Treasury Dealer Quotations, the average
of all such quotations.
"Reference Treasury Dealer" means (1) Lehman Brothers Inc. and Morgan
Stanley & Co. Incorporated, and their respective successors, provided, however,
that if any of the foregoing shall cease to be a primary U.S. government
securities dealer in New York City (a "Primary Treasury Dealer"), we will
substitute for such dealer another Primary Treasury Dealer and (2) any other
nationally recognized Primary Treasury Dealer selected by the Independent
Investment Banker and acceptable to the Company.
5
<PAGE> 6
"The Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any redemption date, the average, as determined by
the Independent Investment Banker, of the bid and asked prices for the
Comparable Treasury Issue (expressed in each case as a percentage of its
principal amount) quoted in writing to the Independent Investment Banker at 5:00
p.m., New York City time, on the third Business Day preceding such redemption
date.
On or after the redemption date, interest will cease to accrue on the
Debentures or any portion thereof called for redemption (unless the Company
defaults in the payment of the redemption price and accrued interest). On or
before any redemption date, the Company will deposit with a paying agent (or the
trustee) money sufficient to pay the redemption price and accrued interest on
the Debentures to be redeemed on such date.
Notice of redemption will be given to the Holders of these Debentures
not more than 60 nor fewer than 30 days prior to the date fixed for redemption.
If fewer than all of the Debentures are to be redeemed, the Trustee
will select the particular Debentures or portions thereof for redemption from
the outstanding Debentures not previously called, pro rata or by lot or in such
other manner as the Company shall direct.
In the event of redemption of this Debenture in part only, a new
Debenture or Debentures of this series and of like tenor for the unredeemed
portion hereof will be issued in the name of the Holder hereof upon the
cancellation hereof.
Upon due presentment for registration of transfer of this Debenture at
the office or agency of the Company designated for such purpose, a new Debenture
or Debentures of this series, of authorized denominations, for a like aggregate
principal amount, will be issued to the transferee as provided in, and subject
to the limitations in, the Indenture. No service charge shall be made for any
such transfer, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in relation thereto.
The Company, the Trustee, any paying agent and any Debenture registrar
may deem and treat the Holder hereof as the absolute owner hereof (whether or
not this Debenture shall be overdue and notwithstanding any notation of
ownership or other writing hereon) for the purpose of receiving payment of or on
account of the principal hereof and, subject to the provisions on the face
hereof, interest hereon, and for all other purposes, and neither the Company nor
the Trustee nor any paying agent nor any Debenture registrar shall be affected
by any notice to the contrary.
No recourse shall be had for the payment of the principal of or the
interest on this Debenture, or for any claim based hereon, or otherwise in
respect hereof, or based on or in respect of the Indenture or any indenture
supplemental thereto, against any incorporator, shareholder, officer or
director, as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law or by
the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released.
This Debenture shall be deemed to be a contract made under the laws of
the State of New York and for all purposes shall be construed in accordance with
the laws of said State.
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