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As filed with the Securities and Exchange Commission on May 10, 1995
Registration No. 33-56909
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
SOUTHWESTERN BELL CAPITAL CORPORATION SBC COMMUNICATIONS INC.
175 E. Houston Street (formerly known as Southwestern Bell
San Antonio, Texas 78205-2233 Corporation)
TELEPHONE NUMBER (210) 351-3888 175 E. Houston Street
San Antonio, Texas 78205-2233
TELEPHONE NUMBER (210) 821-4105
As Issuer and Registrant As Issuer and Registrant of
of Debt Securities Securities and
Obligations Pursuant to the Support
Agreement
A DELAWARE CORPORATION A DELAWARE CORPORATION
I.R.S. EMPLOYER NO. 43-1420172 I.R.S. EMPLOYER NO. 43-1301883
AGENT FOR SERVICE AGENT FOR SERVICE:
ROGER W. WOHLERT JUDITH SAHM
SOUTHWESTERN BELL CAPITAL CORPORATION SBC COMMUNICATIONS INC.
175 E. HOUSTON STREET, 12th Floor 175 E. HOUSTON STREET, 11th Floor
SAN ANTONIO, TEXAS 78205-2233 SAN ANTONIO, TEXAS 78205-2233
PLEASE SEND ALL COPIES OF ALL COMMUNICATIONS TO:
WAYNE WIRTZ JOHN T. BOSTELMAN
SBC COMMUNICATIONS INC. SULLIVAN & CROMWELL
175 E. HOUSTON STREET 250 PARK AVENUE
SAN ANTONIO, TEXAS 78205-2233 NEW YORK, NEW YORK 10177
(210) 821-4105 (212) 558-4000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to the dividend or interest reinvestment plans, please check the
following box. [ ]
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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]
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THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(a) OF THE SECURITIES ACT OF 1933 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 May 10, 1995
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.
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PROSPECTUS
U.S. $3,000,000,000
SBC COMMUNICATIONS INC.
DEBT SECURITIES
PREFERRED STOCK
COMMON STOCK
SOUTHWESTERN BELL CAPITAL CORPORATION
DEBT SECURITIES
SBC Communications Inc. (the "Corporation" or "SBC") may offer
from time to time, together or separately, (i) in one or more series,
unsecured senior debentures, notes or other obligations ("Debt Securities")
of the Corporation, any of which may be convertible or exchangeable into
preferred stock, par value $1.00 per share, of the Corporation ("Preferred
Stock"), Depositary Shares (as defined herein), common stock, par value
$1.00 per share, of the Corporation ("Common Stock"), or equity securities
of another issuer; (ii) Preferred Stock, which may be convertible or
exchangeable into other Preferred Stock (including Depositary Shares),
Common Stock or equity securities of another issuer; (iii) Depositary
Shares; and (iv) Common Stock. The Debt Securities, Common Stock,
Preferred Stock and Depositary Shares are collectively referred to herein
as the "Securities." The Corporation may issue Securities for proceeds up
to an aggregate of not more than U.S. $3,000,000,000 or the equivalent
thereof in one or more currencies or currency units on terms to be
determined at the time such Securities are offered for sale. As used
herein, Securities shall include securities denominated in U.S. dollars or,
at the option of the Corporation and if so specified in the applicable
Prospectus Supplement, in any other currency, including composite
currencies such as the European Currency Unit. The Debt Securities will be
unsecured and will rank equally with all other unsubordinated and unsecured
indebtedness and certain other obligations of the Corporation.
When a particular series of Securities is offered, a prospectus
supplement ("Prospectus Supplement") together with this Prospectus will be
delivered setting forth the terms of such Securities, including, where
applicable, (i) with regard to Debt Securities, the specific designation,
aggregate principal amount, currency or currencies in which the principal,
premium, if any, and interest are payable, denominations, maturity, rate or
rates of any interest, any index, price or formula to be used for
determining the amount of any payment of principal, premium, if any, or
interest, any interest payment dates, whether the Securities are issuable
in registered form, in bearer form, or in the form of one or more global
securities or a combination thereof, any redemption provisions, terms, if
any, for conversion or exchange into other securities, any listing on a
securities exchange, the initial public offering price, methods of
distribution and any other specific terms in connection with the offering
and sale of such Securities; (ii) with regard to Preferred Stock, the
specific designation, number of shares, title, stated value and liquidation
preference of each share, dividend rate or method of calculation, dividend
periods, dividend payment dates, any redemption or sinking fund provision,
any conversion or exchange provisions, whether fractional interests in
shares of Preferred Stock will be offered through depositary arrangements,
any listing on a securities exchange, the initial public offering price,
methods of distribution and any other specific terms in connection with the
offering and sale of such Securities;
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(iii) with regard to Depositary Shares, the fraction of a share of Preferred
Stock which each such Depositary Share will represent; and (iv) with regard
to Common Stock, the number of shares offered, methods of distribution and
the initial public offering price.
Southwestern Bell Capital Corporation ("Capital"), a wholly
owned subsidiary of SBC, may also offer from time to time, together or
separately, in one or more series, Debt Securities of Capital. Any such
Debt Securities may be issued in such amounts and otherwise having any of
the terms specified herein for Debt Securities of the Corporation, except
that Debt Securities of Capital will not be convertible or exchangeable.
Any Debt Securities issued by Capital will also be entitled to the benefits
of a Support Agreement of SBC as described herein (the "Support
Obligations"). Unless otherwise stated, the term "Securities" also
includes Debt Securities of Capital and related Support Obligations of SBC.
The Corporation's Common Stock is listed on the New York Stock
Exchange, the Chicago Stock Exchange and the Pacific Stock Exchange. Any
Common Stock offered will be listed, subject to notice of issuance, on such
exchanges.
The Corporation or Capital may sell Securities to or through
underwriters, and may also sell Securities directly to other purchasers or
through agents. If any underwriters, dealers or agents are involved in the
sale of Securities in respect of which this Prospectus is being delivered,
the names of such underwriters, dealers or agents, any compensation to such
underwriters, dealers or agents will be set forth in the applicable
Prospectus Supplement. See "Plan of Distribution."
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.
The date of this Prospectus is , 1995.
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NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS OR THE PROSPECTUS SUPPLEMENT
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED. NEITHER THE DELIVERY OF THIS
PROSPECTUS OR THE PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER AND
THEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE AN IMPLICATION THAT THERE
HAS BEEN NO CHANGE IN THE AFFAIRS OF THE CORPORATION SINCE THE DATE HEREOF
OR THEREOF. THIS PROSPECTUS AND THE PROSPECTUS SUPPLEMENT DO NOT
CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH
SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING
SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM
IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
AVAILABLE INFORMATION
The Corporation is subject to the informational requirements of
the Securities Exchange Act of 1934 ("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 Corporation 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: 7
World Trade Center, Suite 1300, New York, NY 10048; Citicorp Center, 500
West Madison Street, Suite 1400, Chicago, IL 60661-2511; and 5670 Wilshire
Blvd., 11th Floor, Los Angeles, CA 90036-3648. 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. Such material can also be inspected at
the New York Stock Exchange, 20 Broad Street, New York, NY 10005, on which
the Corporation's common stock is traded.
Capital has been advised by the SEC in a No-Action Letter that
separate financial information regarding Capital need not be included in
any registration statement on Form S-3 filed by Capital and the Corporation
with respect to Debt Securities issued by Capital and the Support
Agreement. The SEC also stated in such No-Action Letter that it will not
raise any objection if Capital does not file periodic reports pursuant to
Sections 13 and 15(d) of the Exchange Act.
The Corporation and Capital have filed with the SEC a
Registration Statement on Form S-3 (together with all amendments and
exhibits thereto, the "Registration Statement") under the Securities Act of
1933, as amended ("Securities Act"). This Prospectus does not contain all
of the information set forth in the Registration Statement, certain parts
of which are omitted in accordance with the rules and regulations of the
SEC. For further information, reference is made to the Registration
Statement.
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INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents have been filed by SBC with the SEC
(File No. 1-8610) and are hereby incorporated herein by reference:
(1) SBC's Annual Report on Form 10-K for the year ended
December 31, 1994; and
(2) SBC's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1995.
ALL DOCUMENTS FILED BY SBC 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 OF THE SECURITIES 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 (other than exhibits to such
documents) may be obtained upon request without charge from SBC's
Specialist--External Reporting, SBC Communications Inc., 175 E. Houston
Street, San Antonio, Texas 78205-2233 (telephone number (210) 351-3049).
SBC COMMUNICATIONS INC.
The Corporation is a communications holding company whose
subsidiaries are engaged principally in communications services. The
Corporation has several subsidiaries, which include: Southwestern Bell
Telephone Company ("Telephone Company"), Southwestern Bell Mobile Systems,
Inc. ("Mobile Systems"), SBC International, Inc. ("SBC International"),
Southwestern Bell Yellow Pages, Inc. ("Yellow Pages") and Southwestern Bell
Telecommunications, Inc. ("Telecom"). The Telephone Company provides
telephone services in the states of Arkansas, Kansas, Missouri, Oklahoma
and Texas (five-state area) and is the Corporation's largest subsidiary,
accounting for approximately 65 percent of the Corporation's 1994 income
before extraordinary loss and cumulative effect of changes in accounting
principles; Mobile Systems principally provides wireless communication
services; SBC International is a holding company owning interests in
directory, cable television and telecommunications businesses in Australia,
Chile, France, Israel, Mexico and the United Kingdom; Yellow Pages engages
principally in the sale of advertising for and publication of Yellow Pages
and White Pages directories and in other directory-related activities; and
Telecom is engaged in the sale of customer premises and private business
exchange equipment.
The Corporation was incorporated under the laws of the State of
Delaware in 1983 by AT&T as one of seven regional holding companies formed
to hold AT&T's local telephone companies. AT&T divested the Corporation by
means of a spin-off of stock to its shareowners on January 1, 1984
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(the "divestiture"). The divestiture was made pursuant to a consent decree,
referred to as the Modification of Final Judgment, issued by the United
States District Court for the District of Columbia.
Capital is a wholly owned finance subsidiary of the Corporation
and was incorporated in 1986 under the laws of the State of Delaware.
Capital is engaged principally in issuing debt securities and lending the
proceeds to the Corporation and to certain subsidiaries of the Corporation
other than the Telephone Company.
Capital and SBC have entered into a Support Agreement, dated as
of November 10, 1986, in which SBC has agreed, among other things, to
ensure the timely payment of principal, premium, if any, and interest owed
on any debt securities, including Debt Securities, and certain other
obligations issued by Capital ("Debt"), with the limitation that no Holder
of Debt Securities issued by Capital or other entity to which Capital
Corporation owes any Debt will have recourse to or against the stock or
assets of the Telephone Company or any interest of SBC or Capital in the
Telephone Company. See "Description of Debt Securities -- Support
Obligations."
The principal office of Capital is located at 175 E. Houston
Street, San Antonio, Texas 78205-2233 (telephone number (210) 351-3888).
SBC's principal executive offices are located at 175 E. Houston
Street, San Antonio, Texas 78205-2233 (telephone number (210) 821-4105).
USE OF PROCEEDS
Unless otherwise specified in a Prospectus Supplement, the net
proceeds from the sale of the Securities by the Corporation or Capital are
intended to be used to provide funds in connection with the repayment of
long and short-term debt of Capital or the Corporation, if any, to provide
funds for the diversification of the Corporation's activities, to provide
funds for certain subsidiaries of the Corporation other than the Telephone
Company, and to provide funds for the general corporate purposes of the
Corporation.
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RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of earnings to fixed
charges of SBC for the periods indicated. At December 31, 1994, no
preferred stock was outstanding.
Three Months
Ended March 31, Year Ended December 31,
1995 1994 1994 1993 1992 1991 1990
4.98 4.74 5.41 4.51 3.96 3.53 3.69
For the purpose of calculating this ratio, earnings consist of
income before income taxes, extraordinary loss, cumulative effect of
changes in accounting principles, and fixed charges. Fixed charges include
interest on indebtedness and one-third of rental expense (the portion of
rentals representative of the interest factor).
DESCRIPTION OF DEBT SECURITIES
The following description of the Debt Securities sets forth
certain general terms and provisions of the Debt Securities of any series
to which any Prospectus Supplement may relate. The particular terms and
provisions of the series of Debt 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 Debt Securities.
The Debt Securities of the Corporation are to be issued under
an Indenture dated as of November 1, 1994 (the "SBC Indenture"), between
the Corporation and The Bank of New York, as trustee ("Trustee"). The Debt
Securities of Capital are to be issued under an Indenture dated as of
February 1, 1987, as supplemented by the First Supplemental Indenture,
dated as of October 1, 1990, among Capital, the Corporation, and the
Trustee (together, the "Capital Indenture" and, together with the SBC
Indenture, the "Indentures"). Copies of the Indentures have been filed as
exhibits to the Registration Statement of which this Prospectus is a part.
The following summaries of certain provisions of the Debt Securities and
the Indentures do not purport to be complete and are subject to, and are
qualified in their entirety by reference to, all provisions of the
Indentures, including the definitions therein of certain terms. Particular
sections of the Indentures which are relevant to the discussion are cited
parenthetically. Wherever particular sections or defined terms of the
Indentures are referred to, it is intended that such sections or defined
terms shall be incorporated herein by reference. "Principal" when used
herein includes, when appropriate, the premium, if any, on the Debt
Securities.
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GENERAL
The Indentures do not limit the amount of Debt Securities which
may 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 Board of
Directors of the Corporation or Capital, as the case may be. Reference is
made to the Prospectus Supplement for the following terms of the particular
series of Debt Securities being offered hereby: (i) the title of the Debt
Securities of the series; (ii) if other than U.S. dollars, the currency or
currencies (which may include composite currencies such as the European
Currency Unit) of payment of principal of and interest on the Debt Securities
of the series; (iii) any limit upon the aggregate principal amount of the
Debt Securities of the series; (iv) the date or dates on which the principal
of the Debt Securities of the series is payable; (v) the rate or rates (or
manner of calculation thereof) at which the Debt Securities of the series
will bear interest, if any, the date or dates from which any such interest
will accrue and on which such interest will be payable, and, with respect
to Debt Securities of the series in registered form, the record date for
the interest payable on any interest payment date and the extent to which,
or the manner in which, any interest payable on a global security on an
interest payment date will be paid if other than in the manner described
under "Global Securities"; (vi) the place or places where the principal of
and interest on the Debt Securities of the series will be payable; (vii)
any redemption or sinking fund provisions; (viii) if in other than
denominations of $1,000 and any integral multiple thereof, the
denominations in which Debt Securities of the series shall be issuable;
(ix) if other than the principal amount thereof, the portion of the
principal amount of Debt Securities of the series which will be payable
upon declaration of acceleration of the maturity thereof; (x) whether the
Debt Securities of the series will be issuable in registered or bearer form
or both, whether any such Debt Securities are to be issuable initially in
temporary global form and whether any such Debt Securities are to be
issuable in permanent global form with or without coupons and, if so,
whether beneficial owners of interests in any such permanent global Debt
Security may exchange such interests for Debt Securities of like tenor of
any authorized form and denomination and the circumstances under which any
such exchange may occur, any restrictions applicable to the offer, sale or
delivery of Debt Securities in bearer form ("bearer Debt Securities") and
whether, and the terms upon which, bearer Debt Securities will be
exchangeable for Debt Securities in registered form ("registered Debt
Securities") and vice versa; (xi) whether and under what circumstances the
Corporation or Capital will pay additional amounts on the Debt Securities
of the series held by a person who is not a U.S. person (as defined below)
in respect of taxes or similar charges withheld or deducted and, if so,
whether the Corporation or Capital will have the option to redeem such Debt
Securities rather than pay such additional amounts; (xii) any index, price
or formula used to determine the amount of payments of principal of,
premium, if any, and interest on the Debt Securities of the series;
(xiii) in the case of Debt Securities of the Corporation, the terms, if
any, upon which the Debt Securities may be convertible into or exchanged
for Common Stock or Preferred Stock (which may be represented by Depositary
Shares) of the Corporation or for equity securities of another issuer and
the terms and conditions upon which such conversion or exchange will be
effected, including the initial conversion or exchange price or rate, the
conversion or exchange period and any other provision in addition to or in
lieu of those described herein; and (xiv) any additional provisions or
other special terms not inconsistent with the provisions of the Indentures,
including any terms which may be required by or advisable under United
States laws or regulations or advisable in connection with the marketing of
Debt Securities of such series. (Sections 2.01 and 2.02.)
Each series of Debt Securities will constitute unsecured and
unsubordinated indebtedness of the issuer thereof and will rank on a parity
with the issuer's other unsecured and unsubordinated
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indebtedness and, in the case of Debt Securities of the Corporation, on a
parity with the Support Obligations.
Debt Securities of any series may be issued as registered Debt
Securities or bearer Debt Securities or both, or in the form of one or more
global securities, as specified in the terms of the series. Unless
otherwise indicated in the Prospectus Supplement, Debt Securities will be
issued in denominations of U.S. $1,000 and integral multiples thereof.
Bearer Debt Securities will be offered, sold and delivered only outside the
United States to non-U.S. persons and to offices located outside the United
States of certain U.S. financial institutions. For purposes of this
Prospectus, "United States" or "U.S." means the United States of America,
including the states and the District of Columbia, its territories, its
possessions and all other areas subject to its jurisdiction. "U.S. 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 or a political subdivision thereof, or an estate or trust the income
of which is subject to United States Federal income taxation regardless of
its source.
Particular restrictions on the offer, sale and delivery of
bearer Debt Securities and any special federal income tax considerations
applicable to bearer Debt Securities will be described in the Prospectus
Supplement relating thereto.
Except as set forth in an applicable Prospectus Supplement,
interest on bearer Debt Securities will be payable only upon presentation
and surrender of the coupons for the interest installments evidenced
thereby as they mature at a paying agency of the Corporation located
outside of the United States. (Section 2.05(c).) The Corporation or
Capital will maintain such an agency for a period of two years after the
principal of such bearer Debt 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 Corporation or Capital will
maintain a paying agent outside the United States to which the bearer Debt
Securities may be presented for payment and will provide the necessary
funds therefor to such paying agent upon reasonable notice. (Section
2.04.) No payment with respect to any bearer Debt Securities will be made
at any office or agency in the United States or by check mailed in or to an
address in the United States or by transfer to an account maintained with a
bank located in the United States. Notwithstanding the foregoing, payments
on bearer Debt Securities denominated and payable in U.S. dollars will be
made in the United States if (but only if) payment of the full amount
thereof in U.S. dollars at each office of each paying agent outside the
United States appointed and maintained by the Corporation is illegal or
effectively precluded by exchange controls or other similar restrictions.
(Section 2.05.)
Registration of transfer of registered Debt Securities may be
requested upon surrender thereof at an agency of the Corporation or Capital
maintained for such purpose ("Registrar") and upon fulfillment of all other
requirements of such Registrar. (Section 2.08(a).) Bearer Debt Securities
and the coupons related thereto will be transferable by delivery. (Section
2.08(e).)
Debt Securities may be issued under the Indentures as Original
Issue Discount Securities to be offered and sold at a substantial discount
from the principal amount thereof. Special federal income tax, accounting
and other considerations applicable thereto will be described in the
Prospectus Supplement relating to such Original Issue Discount Securities.
"Original Issue Discount Security" means any Debt Security which provides
for an amount less than the stated principal amount thereof to be due and
payable
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upon declaration of acceleration of the maturity thereof upon the
occurrence of an event of default and the continuation thereof. (Section
1.01.)
Unless otherwise indicated in an applicable Prospectus
Supplement, payment of principal of and any premium and interest on
registered Debt Securities (other than a global security) will be made at
the office of such paying agent or paying agents as the Corporation or
Capital may designate from time to time, except that, at the option of the
Corporation or Capital, payment of any interest may be made (i) by check
mailed to the address of the payee entitled thereto or (ii) by wire transfer
to an account maintained by such payee. Unless otherwise indicated in an
applicable Prospectus Supplement, payment of any installment of interest on
registered Debt Securities will be made to the person in whose name such
registered Debt Security is registered at the close of business on the
record date for such interest payment.
If the purchase price of any of the Debt Securities is
denominated in other than U.S. dollars or if the principal of and any
premium and interest on any series of Debt Securities is payable in other
than U.S. dollars, then the restrictions, elections, general tax
considerations, specific terms and other information with respect to such
issue of Debt Securities and such currency or currencies will be set forth
in the applicable Prospectus Supplement.
BOOK-ENTRY SECURITIES
The Debt 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 Depository (the "Depository") identified in the
Prospectus Supplement relating to such series. The specific terms of the
Depository arrangement with respect to any Debt Securities of a series will
be described in the Prospectus Supplement relating to such series. The
Corporation and Capital each anticipates that the following provisions will
apply to all Depository arrangements for registered Debt Securities issued
by it.
Unless otherwise specified in an applicable Prospectus
Supplement, Debt Securities which are to be represented by a global
security to be deposited with or on behalf of a Depository will be
represented by a global security registered in the name of such Depository
or its nominee. Upon issuance of a global security in registered form, the
Depository of such global security will credit, on its book-entry
registration and transfer system, the respective principal amounts of the
Debt Securities represented by such global security to the accounts of
institutions that have accounts with such Depository or its nominee
("participants"). The accounts to be credited shall be designated by the
underwriters or agents of such Debt Securities, or by the Corporation or
Capital if such Debt Securities are offered and sold directly by the
Corporation or Capital. Ownership of beneficial interests in a global
security will be limited to participants or persons that may hold interests
through participants. Ownership of beneficial interests in such global
securities will be shown on, and the transfer of that ownership will be
effected only through records maintained by the Depository (with respect to
participants' interests) or its nominee for such global security or by
participants or persons that hold through participants. The laws of some
jurisdictions require that certain purchasers of Debt Securities take
physical delivery of such securities in definitive form. Such laws may
impair the ability to transfer beneficial interests in a global security.
So long as the Depository for a global security in registered
form, or its nominee, is the registered owner of such global security, such
Depository or such nominee, as the case may be, will be considered the sole
owner or holder of the Debt Securities represented by such global security
for all purposes under the Indentures. Except as set forth below, owners
of beneficial interests in such global
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securities will not be entitled to have Debt Securities of the series
represented by such global security registered in their names, will not
receive or be entitled to receive physical delivery of Debt Securities of
such series in definitive form and will not be considered the owners or
holders thereof under the Indentures.
Principal, premium, if any, and interest payments on Debt
Securities registered in the name of or held by a Depository or its nominee
will be made to the Depository or its nominee, as the case may be, as the
registered owner or the holder of the global security representing such
Debt Securities. Neither the Corporation, Capital, the Trustee, or any
paying agent for such Debt Securities will have any responsibility or
liability for any aspect of the records relating to or payments made on
account of beneficial ownership interests in a global security for such
Debt Securities or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests. The Corporation and
Capital each expects that the Depository for Debt Securities of a series,
upon receipt of any payments of principal, premium, if any, or interest in
respect of a global security, will credit immediately the accounts of the
related participants 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 Depository. The Corporation and
Capital each 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.
Unless and until it is exchanged in whole or in part for Debt
Securities in definitive form in accordance with the terms of the Debt
Securities, a global security may not be transferred except as a whole by
the Depository for such global security to a nominee of such Depository or
by a nominee of such Depository to such Depository or another nominee of
such Depository or by such Depository or any such nominee to a successor of
such Depository or a nominee of such successor Depository. If a Depository
for Debt Securities notifies the Corporation or Capital that it is
unwilling or unable to continue as depository for such global security or
if at any time such Depository ceases to be a clearing agency registered
under the Exchange Act, and a successor Depository is not appointed by the
Corporation or Capital within 90 days, the Corporation or Capital will
issue Debt Securities in definitive registered form in exchange for the
global security representing such Debt Securities. In addition, the
Corporation or Capital may at any time and in its sole discretion determine
not to have any Debt Securities in registered form represented by one or
more global securities and, in such event, will issue Debt Securities in
definitive registered form in exchange for all global securities
representing such Debt Securities. Further, if an event of default, or an
event which, with the giving of notice or lapse of time, or both, would
constitute an event of default, under the Indentures occurs and is
continuing with respect to the Debt Securities of a series, or if the
Corporation or Capital so specifies with respect to the Debt Securities of
a series, the Depository may exchange a global security representing Debt
Securities of such series for Debt Securities of such series in definitive
registered 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 Debt Securities of the series represented by such global security
equal in principal amount to such beneficial interest and to have such Debt
Securities registered in its name.
EXCHANGE OF SECURITIES
Registered Debt Securities in definitive form may be exchanged
for an equal aggregate principal amount of registered Debt Securities of
the same series and date of maturity in such authorized
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denominations as may be requested upon surrender of the registered Debt
Securities to the Registrar and upon fulfillment of all other requirements
of such Registrar. (Section 2.08(a).)
To the extent permitted by the terms of a series of Debt
Securities authorized to be issued in registered form and bearer form,
bearer Debt Securities in definitive form may be exchanged for an
equal aggregate principal amount of registered or bearer Debt Securities of
the same series and date of maturity in such authorized denominations as
may be requested upon surrender of the bearer Debt Securities with all
unpaid coupons relating thereto (except as may otherwise be provided in the
Debt Securities) to the Registrar (or a paying agent if the exchange is for
bearer securities) and upon fulfillment of all other requirements of the
Registrar (or such paying agent). (Section 2.08(b).) Registered Debt
Securities may not be exchanged for bearer Debt Securities.
LIENS ON ASSETS
The Indentures do not restrict the Corporation or Capital from
pledging or otherwise encumbering any of its assets, including, in the case
of the Corporation, the stock of the Telephone Company and its right to
dividends paid thereon.
SUCCESSOR ENTITY
Neither the Corporation nor, if it issues the Debt Securities,
Capital may consolidate with or merge into, or be merged into, or transfer
or lease its property and assets substantially as an entirety to, another
entity unless the successor entity is a U.S. corporation, in the case of
the Corporation, and assumes all the obligations of the Corporation under
the Debt Securities and any coupons related thereto or the Support
Obligation, as the case may be, and the relevant Indenture and, in the case
of Capital, assumes all the obligations of Capital under the Debt
Securities and any coupons related thereto, and the Capital Indenture.
Thereafter, except in the case of a lease, all such obligations of the
Corporation under the Debt Securities or the Support Obligations, as the
case may be, and such Indenture, and of Capital under the Debt Securities
and the Capital Indenture shall terminate. (Sections 5.01 and 5.02.)
EVENTS OF DEFAULT
The following events are defined in the Indentures as "Events
of Default" with respect to a series of Debt Securities: (i) default in the
payment of interest on any Debt Security of such series when the same
becomes due and payable and continues for 90 days; (ii) default in the
payment of the principal of any Debt Security of such series when the same
becomes due and payable at maturity, upon redemption, or otherwise;
(iii) failure by the Corporation or, in the case of Debt Securities issued
by Capital, failure by Capital for 90 days after notice to it to comply
with any of its other agreements in the Debt Securities of such series, in
the related Indenture, in any supplemental indenture under which the Debt
Securities of that series may have been issued (other than covenants
relating only to other series); and (iv) certain events of bankruptcy or
insolvency of the Corporation or, in the case of Debt Securities issued by
Capital, of Capital. (Section 6.01.) If an Event of Default occurs with
respect to the Debt Securities of any series and is continuing, the Trustee
or the Holders of at least 25 percent in principal amount of all of the
outstanding Debt Securities of that series may declare the principal (or,
if the Debt 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, and any accrued interest on, all the Debt
Securities of that series to be due and payable. Upon such declaration,
such principal (or, in the case of Original Issue
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Discount Securities, such specified amount) and any accrued interest will
become due and payable immediately. (Section 6.02.)
Debt Securityholders may not enforce the Debt Securities or
related Indenture, except as provided in such Indenture. (Section 6.06.)
The Trustee may require indemnity satisfactory to it before it enforces
the Debt Securities or related Indenture. (Section 7.07.) Subject to
certain limitations, holders of a majority in principal amount of the Debt
Securities of each series affected may direct the Trustee in its exercise
of any trust power with respect to Debt Securities of that series.
(Section 6.05.) The Trustee may withhold from Debt Securityholders notice
of any continuing default (except a default in payment of principal,
premium, if any, or interest) if it determines that withholding notice is
in their interests. (Section 7.05.)
Nothing contained in this section should be construed so as to
limit the rights of Debt Securityholders under the Trust Indenture Act of
1939, as amended.
AMENDMENT AND WAIVER
Subject to certain exceptions, the SBC Indenture or the Debt
Securities issued thereunder may be amended or supplemented by the
Corporation and the Trustee, and the Capital Indenture or the Debt
Securities issued thereunder may be amended by Capital, the Corporation or
the Trustee, in each case with the written consent of the Holders of a
majority in principal amount of the outstanding Debt Securities of each
series affected by the amendment or supplement (with each such series
voting as a class), or compliance with any provision may be waived with the
consent of the Holders of a majority in principal amount of the outstanding
Debt Securities of each series affected by such waiver (with each such
series voting as a class). However, without the consent of each Debt
Securityholder affected, an amendment or waiver may not (i) reduce the
amount of Debt Securities whose holders must consent to an amendment or
waiver; (ii) reduce the rate of or change the time for payment of interest
on any Debt Security; (iii) reduce the principal of, or change the fixed
maturity of, any Debt Security; (iv) waive a default in the payment of the
principal of or interest on any Debt Security; (v) make any Debt Security
payable in currency other than that stated in the Debt Security; or
(vi) impair the right to institute suit for the enforcement of any payment
on or with respect to any Debt Securities. (Section 9.02.)
Either Indenture may be amended or supplemented without the
consent of any holder of Debt Securities issued thereunder (i) to cure any
ambiguity, defect or inconsistency in such Indenture or in such Debt
Securities of any series; (ii) to provide for the assumption of all the
obligations of the Corporation under the Debt Securities and any coupons
related thereto or under the Support Obligations, as the case may be, and
the related Indenture and, in the case of the Capital Indenture, the
obligations of Capital under the Debt Securities and any coupons related
thereto and the Capital Indenture in connection with a merger,
consolidation or transfer or lease of the Corporation's or Capital's
property and assets substantially as an entirety as provided for in such
Indenture; (iii) to provide for the issuance of, and establish the form,
terms and conditions of, a series of Debt Securities or to establish the
form of any certifications required to be furnished pursuant to the terms
of such Indenture for any series of Debt Securities; (iv) to secure the
Debt Securities pursuant to Section 4.02 of such Indenture; (v) to provide
for uncertificated Debt Securities in addition to or in place of
certificated Debt Securities; (vi) to add to rights of Debt Securityholders
or surrender any right or power conferred on the Corporation or Capital; or
(vii) to make any change that does not adversely affect the rights of any
Debt Securityholder. (Section 9.01.)
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CONVERTIBLE AND EXCHANGEABLE DEBT SECURITIES
Certain Debt Securities issued by the Corporation (the
"Convertible Debt Securities") may be convertible into Preferred Stock
(including Depositary Shares) or Common Stock of the Corporation and
certain Debt Securities issued by the Corporation ("Exchangeable Debt
Securities") may be exchangeable for equity securities of another issuer.
The holders of Convertible Debt Securities of a specified series may be
entitled or, if so provided in the applicable Prospectus Supplement, may be
required at such time or times specified in the applicable Prospectus
Supplement, subject to prior redemption, repayment or repurchase, to
convert any Convertible Debt Securities of such series (in denominations
set forth in the applicable Prospectus Supplement) into Preferred Stock,
Depositary Shares or Common Stock, as the case may be (collectively, the
foregoing securities into which the Convertible Debt Securities may convert
are referred to herein as "Conversion Securities") at the conversion price
set forth in the applicable Prospectus Supplement, subject to adjustment as
described below, and in the applicable Prospectus Supplement. The holders
of Exchangeable Debt Securities of a specified series may be entitled or,
if so provided in the applicable Prospectus Supplement, may be required at
such time or times specified in the applicable Prospectus Supplement,
subject to prior redemption, repayment or repurchase, to exchange any
Exchangeable Debt Securities of such series (in denominations set forth in
the applicable Prospectus Supplement) for specified equity securities of
another issuer described in the Prospectus Supplement (collectively, the
foregoing securities for which the Exchangeable Debt Securities may be
exchanged are referred to herein as "Exchange Securities") at the exchange
price set forth in the applicable Prospectus Supplement, subject to
adjustment as described below, and in the applicable Prospectus Supplement.
The relevant provisions for each series of Convertible or Exchangeable Debt
Securities will be set forth in the applicable Prospectus Supplement.
Except as described below or in the applicable Prospectus Supplement, no
adjustment will be made upon conversion of any Convertible Debt Securities
or exchange of any Exchangeable Debt Securities for interest accrued
thereon or for dividends on any Conversion or Exchange Securities issued or
delivered. If any Convertible or Exchangeable Debt Securities not called
for redemption are converted or exchanged between a Regular Record Date for
the payment of interest and the next succeeding Interest Payment Date, such
Convertible or Exchangeable Debt Securities must be accompanied by funds
equal to the interest payable on such succeeding Interest Payment Date on
the principal amount so converted or exchanged. The Corporation is not
required to issue fractional shares of Preferred Stock, Depositary Shares
or Common Stock upon conversion of Convertible Debt Securities or deliver
fractional shares of Exchange Securities upon exchange of Exchangeable
Securities, respectively, and, in lieu thereof, will pay a cash adjustment,
in the case of Convertible Debt Securities convertible into Preferred Stock
or Depositary Shares, based upon the liquidation preference of such series
of Preferred Stock, in the case of Convertible Debt Securities convertible
into Common Stock, based upon the market value of the Common Stock, and in
the case of Exchangeable Debt Securities, based upon the market value of
the Exchange Securities, unless otherwise specified in the Prospectus
Supplement.
The conversion price for a series of Convertible Debt
Securities that are convertible into Common Stock and the exchange price
for Exchangeable Debt Securities are subject to adjustment upon the
occurrence of certain events under formulas that will be set forth in the
applicable Prospectus Supplement.
In the event of a taxable distribution to holders of Common
Stock or Preferred Stock or Exchange Securities (or other transaction)
which results in any adjustment of the conversion price of Convertible Debt
Securities or the exchange price of Exchangeable Debt Securities, the
holders of such
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Convertible or Exchangeable Debt Securities may, in certain circumstances,
be deemed to have received a distribution subject to United States Federal
income tax as a dividend; in certain other circumstances, the absence of
such an adjustment may result in a taxable dividend to the holders of
Common Stock or Preferred Stock or Exchange Securities acquired upon
conversion or exchange of such Convertible or Exchangeable Debt Securities.
SUPPORT OBLIGATIONS
Any Debt Securities issued by Capital will be entitled to the
benefits of the Support Agreement (the "Support Agreement"), dated as of
November 10, 1986, between Capital and the Corporation. The Support
Agreement provides that (a) SBC will own all outstanding voting capital
stock of Capital throughout the term of the Support Agreement, (b) SBC will
cause Capital to maintain a positive tangible net worth as determined in
accordance with generally accepted accounting principles, and (c) if
Capital is unable to make timely payment of principal of, or premium, if
any, or interest on any Debt, SBC will, at Capital's request, provide funds
to Capital to make such payments. The Support Agreement also provides that
any Lender (as defined below) to Capital shall have the right to demand
that Capital enforce its rights against SBC under the Support Agreement as
described in the previous sentence and in the event that Capital fails to
require SBC to perform such obligations or Capital defaults in the payment
of principal of or premium, if any, or interest on any Debt owed to a
Lender, such Lender may proceed directly against SBC to enforce Capital's
rights against SBC under the Support Agreement or to obtain payment of such
defaulted principal, premium, if any, or interest owed to such Lender. The
Support Agreement provides that in no event may any Lender, on default of
Capital or SBC or upon failure by Capital or SBC to comply with the Support
Agreement, have recourse to or against the stock or assets of the Telephone
Company or any interest of SBC or Capital in the Telephone Company.
Despite this limitation, the Support Agreement provides that funds
available to SBC to satisfy any obligations under the Support Agreement
will include dividends paid by the Telephone Company to SBC. See "Ratio of
Earnings to Fixed Charges." The term "Lender" is defined in the Support
Agreement as any person, firm or corporation to which Capital is indebted
for money borrowed or to which Capital otherwise owes any Debt or which is
acting as trustee or authorized representative on behalf of such person,
firm or corporation. Lender includes the Holder of any Debt Securities
issued by Capital and the Trustee acting on such Holder's behalf.
The Support Agreement may be amended or terminated at any time
by agreement of SBC and Capital, but no amendment shall be entered into
which adversely affects the rights of creditors of Capital (Including
Holders of Debt Securities issued by Capital) and no termination shall be
effective until such time as all Debt (including the Debt Securities issued
by Capital) outstanding on the date of such amendment or termination shall
have been paid in full unless all such creditors shall have consented to
such amendment or termination.
CONCERNING THE TRUSTEE
The Corporation and Capital maintain banking relationships in
the ordinary course of business with the Trustee. The Trustee is also the
trustee under an indenture with the Telephone Company which may from time
to time represent a significant portion of the Corporation's consolidated
long-term debt.
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DESCRIPTION OF PREFERRED STOCK
The summary of terms of the Preferred Stock contained in this
Prospectus does not purport to be complete and is subject to, and qualified
in its entirety by, the provisions of the Corporation's Restated Certificate of
Incorporation and Bylaws and the certificate of designations relating to
each series of the Preferred Stock (the "Certificate of Designations"),
which will be filed as an exhibit to or incorporated by reference in the
Registration Statement of which this Prospectus is a part at or prior to
the time of issuance of such series of the Preferred Stock.
SBC's Restated Certificate of Incorporation currently
authorizes the issuance of 10,000,000 preferred shares, par value $1.00 per
share, issuable in series (the "Preferred Stock"). SBC's Board of
Directors is authorized to approve the issuance of one or more series of
Preferred Stock and to fix the number of shares, the designations, the
relative rights and the limitations of any such series without further
authorization of the stockholders of the Corporation. At May 1, 1995, no
shares of Preferred Stock were outstanding, but the Corporation has
designated 4,000,000 shares of Preferred Stock as Series A Junior
Participating Preferred Stock issuable pursuant to a Rights Agreement (the
"Rights Agreement"). See "Description of Rights" and "Description of
Series A Preferred Stock."
Each series of the Preferred Stock shall have the dividend,
liquidation, redemption and voting rights provided in the applicable
Prospectus Supplement. The applicable Prospectus Supplement will describe
the following terms of the series of Preferred Stock in respect of which
this Prospectus is being delivered: (i) the designation and stated value
per share of such Preferred Stock and the number of shares offered;
(ii) the amount of liquidation preference per share; (iii) the initial
public offering price at which such Preferred Stock will be issued;
(iv) the dividend rate (or method of calculation), the dates on which
dividends shall be payable and the dates from which dividends shall
commence to cumulate, if any; (v) any redemption or sinking fund
provisions; (vi) any conversion or exchange rights; (vii) whether the
Corporation has elected to offer Depositary Shares as described below under
"Description of Depositary Shares"; and (viii) any additional voting,
dividend, liquidation, redemption, sinking fund and other rights,
preferences, privileges, limitations and restrictions.
The holders of Preferred Stock will have no preemptive rights.
Preferred Stock, upon issuance against full payment of the purchase price
therefor, will be fully paid and nonassessable. Neither the par value nor
the liquidation preference is indicative of the price at which the
Preferred Stock will actually trade on or after the date of issuance. The
applicable Prospectus Supplement will contain a description of certain
United States Federal income tax consequences relating to the purchase and
ownership of the series of Preferred Stock offered by such Prospectus
Supplement.
As described under "Description of Depositary Shares," the
Corporation may, at its option, elect to offer depositary shares
("Depositary Shares") evidenced by depositary receipts ("Depositary
Receipts"), each representing a fractional interest (to be specified in the
Prospectus Supplement relating to the particular series of the Preferred
Stock) in a share of the particular series of the Preferred Stock issued
and deposited with a Depositary (as defined below).
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The transfer agent for each series of Preferred Stock will be
described in the applicable Prospectus Supplement.
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<PAGE> 17
DESCRIPTION OF DEPOSITARY SHARES
GENERAL
The Corporation may, at its option, elect to offer fractional
shares of Preferred Stock, rather than full shares of Preferred Stock. In
the event such option is exercised, the Corporation will issue to the
public receipts for Depositary Shares, each of which will represent a
fraction (to be set forth in the Prospectus Supplement relating to a
particular series of Preferred Stock) of a share of a particular series of
Preferred Stock as described below.
The shares of any series of Preferred Stock represented by
Depositary Shares will be deposited under a Deposit Agreement (the "Deposit
Agreement") between the Corporation and a bank or trust company selected by
the Corporation having its principal office in the United States and having
a combined capital and surplus of at least $50,000,000 (the "Depositary").
Subject to the terms of the Deposit Agreement, each owner of a Depositary
Share will be entitled, in proportion to the applicable fraction of a share
of Preferred Stock represented by such Depositary Share, to all the rights
and preferences of the Preferred Stock represented thereby (including
dividend, voting, redemption, conversion and liquidation rights).
The Depositary Shares will be evidenced by Depositary Receipts
issued pursuant to the Deposit Agreement. Depositary Receipts will be
distributed to those persons purchasing the fractional shares of Preferred
Stock in accordance with the terms of the offering. Copies of the forms of
Deposit Agreement and Depositary Receipts will be filed as exhibits to, or
incorporated by reference in, the Registration Statement of which this
Prospectus is a part, and the following summary is qualified in its
entirety by reference to such exhibits.
Pending the preparation of definitive engraved Depositary
Receipts, the Depositary may, upon the written order of the Corporation,
issue temporary Depositary Receipts substantially identical to (and
entitling the holders thereof to all the rights pertaining to) the
definitive Depositary Receipts but not in definitive form. Definitive
Depositary Receipts will be prepared thereafter without unreasonable delay,
and temporary Depositary Receipts will be exchangeable for definitive
Depositary Receipts at the Corporation's expense.
Upon surrender of Depositary Receipts at the principal office
of the Depositary (unless the related Depositary Shares have previously
been called for redemption), the owner of the Depositary Shares evidenced
thereby is entitled to delivery at such office, to or upon his order, of
the number of whole shares of Preferred Stock and any money or other
property represented by such Depositary Shares. Partial shares of
Preferred Stock will not be issued. If the Depositary Receipts delivered
by the holder evidence a number of Depositary Shares in excess of the
number of Depositary Shares representing a number of whole shares of
Preferred Stock to be withdrawn, the Depositary will deliver to such holder
at the same time a new Depositary Receipt evidencing such excess number of
Depositary Shares. Holders of shares of Preferred Stock thus withdrawn
will not thereafter be entitled to deposit such shares under the Deposit
Agreement or to receive Depositary Shares therefor. The Corporation does
not expect that there will be any public trading market for withdrawn
shares of Preferred Stock.
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DIVIDENDS AND OTHER DISTRIBUTIONS
The Depositary will distribute all cash dividends or other cash
distributions received in respect of the Preferred Stock to the record
holders of Depositary Shares relating to such Preferred Stock in proportion
to the numbers of such Depositary Shares owned by such holders. The
Depositary shall distribute only such amount, however, as can be
distributed without attributing to any holder of Depositary Shares a
fraction of one cent and any balance not so distributed shall be added to
and treated as part of the next sum received by the Depositary for
distribution to record holders of Depositary Shares.
In the event of a distribution other than in cash, the
Depositary will distribute property received by it to the record holders of
Depositary Shares entitled thereto, unless the Depositary determines that
it is not feasible to make such distribution, in which case the Depositary
may, with the approval of the Corporation, sell such property and
distribute the net proceeds from such sale to such holders.
REDEMPTION OF DEPOSITARY SHARES
If a series of Preferred Stock represented by Depositary Shares
is subject to redemption, the Depositary Shares will be redeemed from the
proceeds received by the Depositary resulting from the redemption, in whole
or in part, of such series of Preferred Stock held by the Depositary. The
Depositary shall mail notice of redemption not less than 30 nor more than
60 days prior to the date fixed for redemption to the record holders of the
Depositary Shares to be so redeemed at their respective addresses appearing
in the Depositary's books. The redemption price per Depositary Share will
be equal to the applicable fraction of the redemption price per share
payable with respect to such series of the Preferred Stock. Whenever the
Corporation redeems shares of Preferred Stock held by the Depositary, the
Depositary will redeem as of the same redemption date the number of
Depositary Shares representing shares of Preferred Stock so redeemed. If
less than all the Depositary Shares are to be redeemed, the Depositary
Shares to be redeemed will be selected by lot or pro rata as may be
determined by the Depositary.
After the date fixed for redemption, the Depositary Shares so
called for redemption will no longer be deemed to be outstanding and all
rights of the holders of the Depositary Shares will cease, except the right
to receive the monies payable upon such redemption and any money or other
property to which the holders of such Depositary Shares were entitled upon
such redemption upon surrender to the Depositary of the Depositary Receipts
evidencing such Depositary Shares.
VOTING THE PREFERRED STOCK
Upon receipt of notice of any meeting at which the holders of
the Preferred Stock are entitled to vote, the Depositary will mail the
information contained in such notice of meeting to the record holders of
the Depositary Shares relating to such Preferred Stock. Each record holder
of such Depositary Shares on the record date (which will be the same date
as the record date for the Preferred Stock) will be entitled to instruct
the Depositary as to the exercise of the voting rights pertaining to the
amount of the Preferred Stock represented by such holder's Depositary
Shares. The Depositary will endeavor, insofar as practicable, to vote the
amount of the Preferred Stock represented by such Depositary Shares in
accordance with such instructions, and the Corporation will agree to take
all action which may be deemed necessary by the Depositary in order to
enable the Depositary to do so. The Depositary will
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abstain from voting shares of the Preferred Stock to the extent it does not
receive specific instructions from the holders of the Depositary Shares
representing such Preferred Stock.
CONVERSION OR EXCHANGE
Whenever the Corporation converts all of the shares of a
particular series of Preferred Stock held by the Depositary into other
Preferred Stock or Common Stock or exchanges all such shares for securities
of another issuer, the Depositary will convert or exchange as of the same
date all Depositary Shares representing the shares of the Preferred Stock
so converted or exchanged, provided that the Corporation shall have
deposited with the Depositary the other Preferred Stock, Common Stock or
other securities into or for which all such shares of Preferred Stock are
to be converted or exchanged. The exchange rate per Depositary Share shall
be equal to the exchange rate per share of Preferred Stock multiplied by
the fraction of a share of Preferred Stock represented by one Depositary
Share, plus all money and other property, if any, represented by such
Depositary Shares, including all amounts paid by the Corporation in respect
of dividends which on the exchange date have accrued on the shares of
Preferred Stock to be so converted or exchanged and have not theretofore
been paid.
The Depositary Shares, as such, are not convertible or
exchangeable into other Preferred Stock, Common Stock, securities of
another issuer or any other securities or property of the Corporation.
Nevertheless, if so specified in the applicable Prospectus Supplement, the
Depositary Receipts may be surrendered by holders thereof to the Depositary
with written instructions to the Depositary to instruct the Corporation to
cause conversion of the Preferred Stock represented by the Depositary
Shares evidenced by such receipts into other shares of Preferred Stock or
Common Stock of the Corporation or exchange of such Preferred Stock for
securities of another issuer, as the case may be, and the Corporation has
agreed that upon receipt of such instructions and any amounts payable in
respect thereof, it will cause the conversion or exchange thereof utilizing
the same procedures as those provided for delivery of Preferred Stock to
effect such conversion or exchange. If the Depositary Shares represented
by a Depositary Receipt are to be converted in part only, a new Depositary
Receipt or Receipts will be issued for any Depositary Shares not to be
converted or exchanged.
TAXATION
Owners of the Depositary Shares will be treated for Federal
income tax purposes as if they were owners of the series of Preferred Stock
represented by such Depositary Shares and, accordingly, will be entitled to
take into account for Federal income tax purposes income and deductions to
which they would be entitled if they were holders of such series of
Preferred Stock. In addition, (i) no gain or loss will be recognized for
Federal income tax purposes upon the withdrawal of Preferred Stock in
exchange for Depositary Shares as provided in the Deposit Agreement,
(ii) the tax basis of each share of Preferred Stock to an exchanging owner
of Depositary Shares will, upon such exchange, be the same as the aggregate
tax basis of the Depositary Shares exchanged therefor and (iii) the holding
period for shares of the Preferred Stock in the hands of an exchanging
owner of Depositary Shares who held such Depositary Shares as a capital
asset at the time of the exchange thereof for Preferred Stock will include
the period during which such person owned such Depositary Shares.
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AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares
and any provision of the Deposit Agreement may at any time be amended by
agreement between the Corporation and the Depositary. However, any
amendment which materially and adversely alters the rights of the holders
of Depositary Shares will not be effective unless such amendment has been
approved by the holders of at least a majority of the Depositary Shares
then outstanding. The Deposit Agreement may be terminated by the
Corporation or the Depositary only if (i) all outstanding Depositary Shares
have been redeemed or (ii) there has been a final distribution in respect
of the Preferred Stock in connection with any liquidation, dissolution or
winding up of the Corporation and such distribution has been distributed to
the holders of Depositary Receipts.
CHARGES OF DEPOSITARY
The Corporation will pay all transfer and other taxes and
governmental charges arising solely from the existence of the depositary
arrangements. The Corporation will pay charges of the Depositary in
connection with the initial deposit of the Preferred Stock and any
redemption of the Preferred Stock. Holders of Depositary Receipts will pay
other transfer and other taxes and governmental charges and such other
charges as are expressly provided in the Deposit Agreement to be for their
accounts.
MISCELLANEOUS
The Depositary will forward to the holders of Depositary Shares
all reports and communications from the Corporation which are delivered to
the Depositary and which the Corporation is required to furnish to the
holders of the Preferred Stock.
Neither the Depositary nor the Corporation will be liable if it
is prevented or delayed by law or any circumstance beyond its control in
performing its obligations under the Deposit Agreement. The obligations of
the Corporation and the Depositary under the Deposit Agreement will be
limited to performance in good faith of their duties thereunder and they
will not be obligated to prosecute or defend any legal proceeding in
respect of any Depositary Shares or Preferred Stock unless satisfactory
indemnity is furnished. They may rely upon written advice of counsel or
accountants, or information provided by persons presenting Preferred Stock
for deposit, holders of Depositary Receipts or other persons believed to be
competent and on documents believed to be genuine.
RESIGNATION AND REMOVAL OF DEPOSITARY
The Depositary may resign at any time by delivering to the
Corporation notice of its election to do so, and the Corporation may at any
time remove the Depositary, any such resignation or removal to take effect
upon the appointment of a successor Depositary and its acceptance of such
appointment. Such successor Depositary must be appointed within 60 days
after delivery of the notice of resignation or removal and must be a bank
or trust company having its principal office in the United States and
having a combined capital and surplus of at least $50,000,000.
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DESCRIPTION OF COMMON STOCK
SBC's Restated Certificate of Incorporation currently
authorizes the issuance of 1,100,000,000 shares of Common Stock. As of
April 28, 1995, there were outstanding 607,746,811 shares of Common Stock
(as well as 303,873,405.5 Rights to Purchase Series A Preferred Stock
pursuant to the Rights Agreement) (each as defined below). See "Description
of Rights".
The Common Stock is listed on the NYSE, the Chicago Stock
Exchange and the Pacific Stock Exchange under the symbol "SBC".
The holders of Common Stock are entitled to participate equally
in dividends when and as such dividends are declared by the SBC Board of
Directors out of funds legally available therefor.
The holders of Common Stock are entitled to one vote for each
share held on all matters voted on by stockholders, including election of
directors. The holders of Common Stock do not have any conversion,
redemption, preemptive or cumulative voting rights. In the event of the
dissolution, liquidation or winding up of SBC, holders of Common Stock are
entitled to share ratably in any assets remaining after the satisfaction in
full of the prior rights of creditors, including holders of SBC's
indebtedness, and the aggregate liquidation preference of any Preferred
Stock then outstanding.
All outstanding shares of Common Stock are, and any shares of
Common Stock offered hereby upon issuance will be, fully paid and
nonassessable.
The Bylaws of the Corporation provide that the Board of
Directors shall be divided into three classes each consisting of an equal,
or as nearly equal as possible, number of Directors. The terms of each
class will expire in succeeding years. It will, therefore, require
elections in three consecutive years to reelect or to replace the entire
Board of Directors. The Bylaws of the Corporation also provide that
certain business combinations must be approved by an affirmative vote of
the holders of two-thirds of the then outstanding shares of capital stock
of the Corporation entitled to vote generally in the election of directors
(the "Voting Stock"). A "business combination" subject to this vote of
approval is defined to include certain mergers or consolidations; certain
sales, leases, exchanges, or mortgages of property in excess of $10,000,000
fair market value; any plan or proposal for liquidation or dissolution of
the Corporation, and certain reclassifications of securities or
recapitalization of the Corporation to which a stockholder beneficially
owning more than ten percent of the voting stock (an "Interested
Stockholder") or any affiliate of an Interested Stockholder is a party.
The two-thirds vote of approval is not required if the business combination
is approved by a majority of Directors not affiliated with any Interested
Stockholder or if the consideration received by the other stockholders upon
the consummation of the business combination reflects a fair value (which
is determined by formulae set forth in the Bylaws) for their interest in
the Corporation and certain other requirements are met, including
maintenance of dividends during the business combination and the furnishing
of information to the stockholders of the Corporation.
The Restated Certificate of Incorporation of the Corporation
requires a two-thirds affirmative vote of the shareholders to amend any Bylaw
which provides for the maximum number of Directors on the Board, for a
classified Board with staggered items of office or for approval by the
shareholders or by the Board of Directors of any business combination.
The Restated Certificate of Incorporation also requires that
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<PAGE> 22
shareholders representing at least two-thirds of the total number of shares
of the Corporation must sign a written consent of any action without a
meeting of the shareholders. Reference is hereby made to the Restated
Certificate of Incorporation and the Bylaws of the Corporation which are
incorporated by reference as exhibits to the Registration Statement of which
this Prospectus is a part.
The provisions described in the foregoing two paragraphs, as
well as the provisions of the Rights Agreement described under "Description
of Rights" below, may tend to defer any potential unfriendly tender offers
or other efforts to obtain control of the Corporation. On the other hand,
these provisions will tend to assure continuity of management and corporate
policies and tend to induce any persons seeking control of the Corporation
or a business combination with the Corporation to negotiate on terms
acceptable to the then elected Board of Directors of the Corporation.
The transfer agent for the Common Stock is The Bank of New
York, Church Street Station, P.O. Box 11272, New York, New York 10277-0123.
DESCRIPTION OF RIGHTS
THE RIGHTS AGREEMENT
The information set forth below summarizes certain of the
provisions of the Rights Agreement incorporated by reference as an
exhibit to the Registration Statement of which this Prospectus is a part.
Such information is qualified in its entirety by reference to such exhibit.
See "Available Information."
On January 27, 1989, the Board of Directors of SBC declared a
dividend distribution of one right (a "Right") for each outstanding share
of Common Stock to shareholders of record at the close of business on
February 16, 1989. After giving effect to a stock split in May 1993,
effected in the form of a stock dividend, each share of Common Stock also
represents one-half of a Right. Each Right entitles the registered holder
to purchase from SBC a unit consisting of one one-hundredth of a share (a
"Unit") of Series A Junior Participating Preferred Stock, par value $1.00
per share (the "Series A Preferred Stock"), at a purchase price of $160 per
Unit, subject to adjustment (the "Purchase Price"). The description and
terms of the Rights are set forth in a Rights Agreement (the "Rights
Agreement") between SBC and The Bank of New York, as successor Rights
Agent.
Initially, the Rights will be attached to all Common Stock
certificates representing shares then outstanding, and no separate
certificate representing the Rights (the "Rights Certificates") will be
distributed. The Rights will separate from the Common Stock and a
distribution date (the "Distribution Date") will occur upon the earliest of
any of the following events:
(A) 10 business days following a public announcement that
a person or group of affiliated or associated persons (an
"Acquiring Person") has acquired, or obtained the right to
acquire (the "Stock Acquisition Date"), beneficial ownership of
20% or more of the shares of Common Stock then outstanding;
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<PAGE> 23
(B) 10 business days following the commencement of a
tender offer or exchange offer that would result in a person or
group beneficially owning 20% or more of such outstanding
shares of Common Stock;
(C) 10 days after the Board of Directors of SBC
determines that any person, alone or together with its
affiliates and associates, has become the beneficial owner of
an amount of Common Stock which the SBC Board of Directors
determines to be substantial (which amount shall in no event be
less than 10% of the shares of Common Stock outstanding) and at
least a majority of the independent directors, after reasonable
inquiry and investigation, including consultation with such
persons as such directors shall deem appropriate, determines
that (i) beneficial ownership by such person is intended to
cause SBC to repurchase the Common Stock beneficially owned by
such person or to cause pressure on SBC to take action or enter
into a transaction or series of transactions intended to
provide such person with short-term financial gain under
circumstances where the SBC Board of Directors determines that
the best long-term interests of SBC and its shareowners would
not be served by taking such action or entering into such
transactions or series of transactions at that time or (ii)
beneficial ownership by such person is causing or reasonably
likely to cause a material adverse impact (including, but not
limited to, impairment of relationships with customers or
regulators or impairment of SBC's ability to maintain its
competitive position) on the business or prospects of SBC (any
such person being referred to herein and in the Rights
Agreement as an "Adverse Person").
Until the Distribution Date, (i) the Rights will be evidenced
by the Common Stock certificates and will be transferred with and only with
such Common Stock certificates, (ii) new Common Stock certificates issued
after February 16, 1989 will contain a notation incorporating the Rights
Agreement by reference and (iii) the surrender for transfer of any
certificates for Common Stock outstanding will also constitute the transfer
of the Rights associated with the Common Stock represented by such
certificate. Pursuant to the Rights Agreement, SBC reserves the right to
require that, upon any exercise of Rights, a number of Rights be exercised
so that only whole shares of Preferred Stock will be issued.
The Rights are not exercisable until the Distribution Date and
will expire at the close of business on January 27, 1999, unless they are
earlier redeemed by SBC or expire in accordance with other provisions of
the Rights Agreement as described below.
As soon as practicable after the Distribution Date, Rights
Certificates will be mailed to holders of record of the Common Stock as of
the close of business on the Distribution Date and, thereafter, the
separate Rights Certificates alone will represent the Rights. Except as
otherwise determined by the SBC Board of Directors, only shares of Common
Stock issued prior to the Distribution Date will be issued with Rights.
In the event that, at any time following the Distribution Date,
(i) a Person becomes the beneficial owner (except pursuant to a Flip-Over
Event, as described below, or an offer for all outstanding shares of Common
Stock which the independent directors determine to be fair to and otherwise
in the best interests of SBC and its shareowners) of more than 20% of the
then outstanding shares of Common Stock, or (ii) a Person becomes an
Adverse Person, each holder of a Right will thereafter have the right to
receive, upon exercise, Series A Preferred Stock (or, in certain
circumstances,
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<PAGE> 24
cash, property or other securities of SBC) having a value equal to two
times the Purchase Price of the Right. Notwithstanding any of the
foregoing, following the occurrence of any of the events set forth in this
paragraph ("Flip-In Events"), all Rights that are, or (under certain
circumstances specified in the Rights Agreement) were, beneficially owned
by any Acquiring Person or an Adverse Person will be null and void.
However, Rights are not exercisable following the occurrence of either of
the Flip-In Events set forth above until such time as the Rights are no
longer redeemable by SBC as set forth below.
For example, at a Purchase Price of $160 per Right, each Right
not owned by an Acquiring Person or by an Adverse Person (or by certain
related parties) following Flip-In Events set forth in the preceding
paragraph would entitle its holder to purchase $320 worth of Common Stock
(or other consideration, as noted above) for $160. Assuming that the
Common Stock had a per share value of $40 at such time, the holder of each
valid Right would be entitled to purchase 8 shares of Common Stock for
$160.
Following the occurrence of any of the Flip-In Events set forth
above, subject to applicable law, the SBC Board of Directors may determine
to exchange for any or all Rights (other than Rights held by the Acquiring
Person or Adverse Person and certain transferees) Common Stock with a value
equal to the Right's Purchase Price or substitute value in the form of
cash, property, debt or equity securities, or any combination of the
foregoing. Such exchange shall be on a pro rata basis if less than all
Rights are to be exchanged, and holders of Rights pay no consideration
(other than delivery of the Right) in such exchange.
In the event that, at any time following the Stock Acquisition
Date, (i) SBC is acquired in a merger or other business combination
transaction in which SBC is not the surviving corporation (other than
certain mergers following a fair offer described in the third preceding
paragraph), or (ii) more than 50% of SBC's assets, cash flow or earning
power is sold or transferred (events (i) and (ii) are referred to as "Flip-
Over Events" and together with Flip-In Events, the "Triggering Events")
each holder of a Right which has not yet been exercised (except Rights
which previously have been voided as set forth above) shall thereafter have
the right to receive, upon exercise, common stock of the acquiring company
having a value equal to two times the Purchase Price of the Right.
The Purchase Price payable, and the number of Units of Series A
Preferred Stock or other securities or property issuable, upon exercise of
the Rights are subject to adjustment from time to time to prevent dilution
(i) in the event of a stock dividend on, or a subdivision, combination or
reclassification of, the Series A Preferred Stock, (ii) if holders of the
Series A Preferred Stock are granted certain rights or warrants to
subscribe for Series A Preferred Stock or convertible securities at less
than the current market price of Series A Preferred Stock, or (iii) upon
the distribution to holders of the Series A Preferred Stock of evidence of
indebtedness or assets (excluding regular quarterly cash dividends) or of
subscription rights or warrants (other than those referred to above).
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments amount to at least 1% of the
Purchase Price. No fractional Units will be issued and, in lieu thereof,
an adjustment in cash will be made based on the market price of the Series
A Preferred Stock on the last trading date prior to the date of exercise.
In general, at any time until 10 business days following the
Stock Acquisition Date, or such later date as the SBC Board of Directors
may designate, SBC may redeem the Rights in whole, but
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<PAGE> 25
not in part, at a price of $.05 per Right (payable in cash, Common Stock or
other consideration deemed appropriate by the SBC Board of Directors).
Under certain circumstances set forth in the Rights Agreement, the decision
to redeem the Rights shall require the concurrence of a majority of the
Continuing Directors. Immediately upon the action of the SBC Board of
Directors ordering redemption of the Rights (with, where required, the
concurrence of the Continuing Directors) the Rights will terminate and the
only right of the holders of Rights will be to receive the $.05 redemption
price.
The term "Continuing Directors" means any member of the Board
of Directors of SBC who was a member of the Board prior to the date of the
Rights Agreement, and any person who is subsequently elected to the Board
if such person is recommended or approved by a majority of the Continuing
Directors, but shall not include an Acquiring Person, Adverse Person or an
affiliate or associate of an Acquiring Person or Adverse Person, or any
representative of the foregoing entities.
Until a Right is exercised, the holder thereof, as such, will
have no rights as a shareowner of SBC, including, without limitation, the
right to vote or to receive dividends. While the distribution of the
Rights will not be taxable to shareowners or to SBC, shareowners may,
depending upon the circumstances, recognize taxable income in the event
that the Rights become exercisable for Series A Preferred Stock (or for
other consideration) or for common stock of the acquiring company as set
forth above.
Other than those provisions relating to the principal economic
terms of the Rights, any of the provisions of the Rights Agreement may be
amended by the SBC Board of Directors prior to the Distribution Date.
After the Distribution Date, the provisions of the Rights Agreement may be
amended by the Board (in certain circumstances, with the concurrence of the
Continuing Directors) in order to cure any ambiguity, to make changes which
do not adversely affect the interests of holders of Rights (excluding the
interests of any Acquiring Person or Adverse Person), or to shorten or
lengthen any time period under the Rights Agreement.
DESCRIPTION OF SERIES A PREFERRED STOCK
The information set forth below summarizes certain of the
provisions of the Series A Junior Participating Preferred Stock (the
"Series A Preferred Stock") of the Corporation. Such information is
qualified in its entirety by reference to the terms of the Series A
Preferred Stock set forth in the Corporation's Restated Certificate of
Incorporation, which has been filed as an exhibit to the Registration
Statement of which this Prospectus forms a part.
In connection with the Rights Agreement, the Board of Directors
of the Corporation has authorized the issuance of up to 4,000,000 shares of
Series A Preferred Stock. See "Rights Agreement." Upon issuance, each
share of Series A Preferred Stock is entitled to quarterly cash dividends
equal to the greater of $5 or 200 times (subject to antidilution
adjustments for stock dividends and stock splits) the aggregate value of
all dividends or other distributions declared on the Common Stock (other
than distributions of Common Stock) since the last quarterly dividend
payment date. The Series A Preferred Stock is not redeemable by the
Corporation.
Each share of Series A Preferred Stock is entitled to 200 votes
(subject to antidilution adjustments) on all matters submitted to a vote of
the shareholders of the Corporation, voting together as one class with the
Common Stock. In addition, if at any time dividends in an amount equal to
six
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<PAGE> 26
quarterly dividend payments shall have accrued and be unpaid, the Board of
Directors shall be increased by two directors and holders of the Series A
Preferred Stock shall have the right to elect two members to the Board of
Directors until dividends on the Series A Preferred Stock have been
declared and paid or set apart for payment. Except as required by
applicable law, holders of Series A Preferred Stock have no other special
voting rights. Whenever dividends or distributions on the Series A
Preferred Stock are in arrears, the Corporation is prohibited from
declaring or paying dividends or distributions on, and the Corporation and
any subsidiary are prohibited from redeeming or acquiring for value, any
stock ranking junior as to dividends or upon liquidation. During any such
arrearage, the Corporation may declare or pay dividends on stock ranking on
a parity with the Series A Preferred Stock as to dividends or upon
liquidation only if declared or paid ratably with the Series A Preferred
Stock. During any such arrearage, the Corporation and any subsidiary are
prohibited from redeeming or acquiring for value any such parity stock or
any Series A Preferred Stock, except pursuant to an exchange of parity
stock for stock ranking junior to the Series A Preferred Stock or pursuant
to a purchase offer to the Series A Preferred Stock and holders of parity
stock on terms the Board of Directors determines to be fair and equitable.
The Series A Preferred Stock ranks junior to all other series
of the Corporation's preferred stock as to the payment of dividends and the
distribution of assets, unless the terms of any such series shall provide
otherwise.
Upon any liquidation, dissolution or winding up of the
Corporation, the Series A Preferred Stock is entitled to a liquidation
preference of $100 per share plus any accrued but unpaid dividends, subject
to the prior rights of any series of preferred stock ranking in liquidation
senior to the Series A Preferred Stock. In the event of any shortfall in
the assets available for distribution, any such liquidating distribution
shall be made ratably to the Series A Preferred Stock and any other series
of preferred stock ranking on a parity in proportion to their relative
liquidation preferences. Following such payment, no additional liquidating
distributions may be made on the Series A Preferred Stock until each share
of Common Stock shall have received $0.50 (subject to antidilution
adjustments). Thereafter, any remaining assets shall be distributed to
each share of Series A Preferred Stock and each share of Common Stock in
the ratio of 200 to 1 (subject to antidilution adjustments).
PLAN OF DISTRIBUTION
GENERAL
The Corporation or Capital may sell the Securities being
offered hereby: (i) directly to purchasers, (ii) through agents,
(iii) through dealers, (iv) through underwriters, 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
Corporation or Capital or by agents designated by the Corporation or
Capital 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
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<PAGE> 27
payable by the Corporation or Capital to such agent will be set forth in
the Prospectus Supplement relating to the offering of such Securities.
Unless otherwise indicated in the applicable Prospectus Supplement, any
such agent will be acting on a best efforts basis for the period of its
appointment.
If a dealer is utilized in the sale of the Securities in
respect of which this Prospectus is delivered, the Corporation or Capital
will sell such Securities to the dealer, as principal. The dealer, which
may be deemed to be an underwriter as that term is defined in the
Securities Act, may then resell such Securities to the public at varying
prices to be determined by such dealer at the time of resale.
If an underwriter or underwriters are utilized in the sale, the
Corporation or Capital will execute an underwriting agreement with such
underwriters at the time of sale to them and the names of the underwriters
will be set forth in the applicable 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.
Underwriters, dealers, agents and other persons may be
entitled, under agreements which may be entered into with the Corporation
or Capital, to indemnification against certain civil liabilities, including
liabilities under the Securities Act.
DELAYED DELIVERY ARRANGEMENTS
If so indicated in the Prospectus Supplement, the Corporation
or Capital will authorize underwriters, dealers or other persons acting as
agents of the Corporation or Capital to solicit offers by certain
institutions to purchase Securities from the Corporation or Capital
pursuant to contracts providing for payment and delivery on a future date
or dates. Institutions with which such contracts may be made include
commercial and savings banks, insurance companies, pension funds,
investment companies, educational and charitable institutions and others,
but in all cases such institutions must be approved by the Corporation or
Capital. The obligations of any purchaser under any such contract will not
be subject to any conditions except that (a) the purchase of the Securities
shall not at the time of delivery be prohibited under the laws of the
jurisdiction to which such purchaser is subject, and (b) if the Securities
are also being sold to underwriters, the Corporation or Capital shall have
sold to such underwriters the Securities not sold for delayed delivery.
The underwriters, dealers and such other persons will not have any
responsibility in respect of the validity or performance of such contracts.
LEGAL OPINIONS
The validity of the Securities of the Corporation offered
hereby and of the Support Agreement will be passed upon for the Corporation
by Mr. James D. Ellis, Senior Executive Vice President and General Counsel
of the Corporation, and for any underwriters, dealers or agents by Sullivan
& Cromwell, New York, New York. The validity of the Debt Securities of
Capital offered hereby and of the Support Agreement will be passed upon for
Capital by Mr. Wayne Wirtz, Secretary of Capital and its counsel, and for
any underwriters, dealers or agents by Sullivan & Cromwell, New York, New
York. As of April 1, 1995, Mr. Ellis owned 49,409 shares of SBC Common Stock
and options to purchase 131,387 shares of SBC Common Stock, and Mr. Wirtz owned
2,415 shares of SBC Common Stock and options to purchase 18,913 shares of SBC
Common Stock. Sullivan & Cromwell from time to time performs legal services
for SBC.
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<PAGE> 28
EXPERTS
The consolidated financial statements and financial statement
schedules included or incorporated by reference in SBC's Annual Report on
Form 10-K for the year ended December 31, 1994, and incorporated by
reference in this prospectus and registration statement, have been audited
by Ernst & Young LLP, independent auditors, as set forth in their reports
included and incorporated by reference in SBC's Annual Report on Form 10-K.
Such consolidated financial statements and financial statement schedules
have been incorporated by reference in reliance upon such reports given
upon the authority of Ernst & Young LLP as experts in accounting and
auditing.
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<PAGE> 29
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Securities and Exchange Commission
Filing Fee . . . . . . . . . . . . . . . . . . . . . . . $1,034,490
Legal Fees and Expenses . . . . . . . . . . . . . . . . . . 75,000*
Fees and Expenses of Trustee . . . . . . . . . . . . . . . 20,000*
Accountants' Fees and Expenses . . . . . . . . . . . . . . 65,000*
Blue Sky Fees and Expenses . . . . . . . . . . . . . . . . 50,000*
Miscellaneous Expenses . . . . . . . . . . . . . . . . . . 317,000*
Total . . . . . . . . . . . . . . . . . . . . . . $1,561,490*
*Estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law ("DGCL")
permits a corporation to indemnify its directors and officers against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlements actually and reasonably incurred by them in connection with any
action, suit or proceeding brought by third parties, if such directors or
officers acted in good faith and in a manner they reasonably believed to be
in or not opposed to the best interests of the corporation and, with
respect to any criminal action or proceeding, had no reason to believe
their conduct was unlawful. In a derivative action, i.e., only by or in
the right of the corporation, indemnification may be made only for expenses
actually and reasonably incurred by directors and officers in connection
with the defense or settlement of an action or suit, and only with respect
to a matter as to which they shall have acted in good faith and in a manner
they reasonably believed to be in or not opposed to the best interests of
the corporation, except that no indemnification shall be made if such
person shall have been adjudged liable to the corporation, unless and only
to the extent that the court in which the action or suit was brought shall
determine upon application that the defendant officers or directors are
fairly and reasonably entitled to indemnity for such expenses despite such
adjudication of liability.
SBC's Bylaws provide that SBC shall indemnify any person who
was or is a party or is threatened to be made a party to any action, suit or
proceeding, whether civil, criminal, administrative or investigative
(including any action or suit by or in the right of SBC) by reason of the
fact that such person is or was a director, officer, employee or agent of
SBC or is or was serving at the request of SBC as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust
or other enterprise, against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably
incurred by such person in connection with such action, suit or proceeding,
but in each case only if and to the extent permitted under applicable state
or federal law.
SBC's Bylaws further state that the indemnification provided
therein shall not be deemed exclusive of any other rights to which those
indemnified may be entitled, and shall continue as to a person
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<PAGE> 30
who has ceased to be a director, officer, employee or agent and shall
inure to the benefit of the heirs, and personal representatives of such a
person.
The SBC Restated Certificate of Incorporation provides that no
director of SBC shall be liable to SBC or its stockholders for monetary
damages for breach of fiduciary duty as a director, except for liability
(1) for any breach of the director's duty of loyalty to SBC or its
stockholders; (2) for acts or omissions not in good faith or which involve
intentional misconduct or knowing violation of the law; (3) under Section
174 of the DGCL; or (4) for any transaction from which a director derived
an improper benefit.
The Bylaws of Capital provide that Capital shall indemnify, and
advance expenses to, any director, officer employee or agent of Capital or
any person serving as a director or officer of any other entity at the
request of Capital to the fullest extent permitted by law.
Pursuant to agreements which may be entered into by SBC and
Capital, underwriters may agree to indemnify and hold harmless SBC and
Capital, each of its directors, each of its officers who signed the
Registration Statement and any person who controls SBC or Capital within
the meaning of the Securities Act from and against certain civil
liabilities, including liabilities under the Securities Act.
ITEM 16. EXHIBITS.
The exhibits identified in parentheses below, on file with the
Securities and Exchange Commission, are incorporated herein by reference as
exhibits hereto. On April 28, 1995, SBC filed an amendment to its Restated
Certificate of Incorporation with the Secretary of State of the State of
Delaware reflecting the change in its name from Southwestern Bell Corporation
to SBC Communications Inc. Except as otherwise noted, references herein to
"Southwestern Bell Corporation" are to the entity now known as "SBC
Communications Inc."
Exhibit
Number
1-a* Form of Underwriting Agreement for Debt Securities issued by the
Corporation.
1-b Form of Underwriting Agreement for Preferred Stock and/or Depositary
Shares (to be filed by post-effective amendment or incorporated by
reference herein prior to the issuance of Preferred Stock and/or
Depositary Shares).
1-c Form of Underwriting Agreement for Common Stock (to be filed by post-
effective amendment or incorporated by reference herein prior to the
issuance of Common Stock).
1-d Form of Selling Agency Agreement for Debt Securities issued by
Capital (Exhibit 1-b to Registration Statement No. 33-45490).
1-e* Form of Underwriting Agreement for Debt Securities issued by Capital.
4-a* Form of Indenture, dated as of November 1, 1994, between Southwestern
Bell Corporation and The Bank of New York, Trustee. The form or
forms of Debt Securities with respect to each
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<PAGE> 31
particular series of Debt Securities will be filed as an exhibit to a
Current Report on Form 8-K of SBC Communications Inc. and
incorporated herein by reference.
4-b Restated Certificate of Incorporation of SBC Communications Inc.
(Exhibit 3 to Form 10-Q for the first quarter 1995, File 1-8610).
4-c Bylaws, as amended to date (Exhibit 3-b to Form 10-Q for the second
quarter 1991, File 1-8610).
4-d Rights Agreement (executed in the form as filed), dated as of January
27, 1989, between Southwestern Bell Corporation and American
Transtech, Inc., the Rights Agent, which includes as Exhibit B
thereto the Form of Rights Certificate (Exhibit 4-a to Form 8-A,
dated February 9, 1989, File 1-8610).
4-e Amendment of Rights Agreement (executed in the form as filed), dated
as of August 5, 1992, between Southwestern Bell Corporation, American
Transtech, Inc., and The Bank of New York, the successor Rights
Agent, which includes the Form of Rights Certificate as an attachment
identified as Exhibit B (Exhibit 4-a to Form 8-K, dated August 7,
1992, File 1-8610).
4-f Form of Rights Certificate (included in the attachment to the
Amendment of Rights Agreement and identified as Exhibit B) (Exhibit
4-b to Form 8-K, dated August 7, 1992, File 1-8610).
4-g Second Amendment of Rights Agreement, dated as of June 15, 1994,
between Southwestern Bell Corporation and The Bank of New York, as
successor Rights Agent (Exhibit 4-e to Form 8-A/A, dated June 22,
1994, File 1-8610).
4-h Form of Deposit Agreement, including form of Depositary Receipt for
Depositary Shares (to be filed by post-effective amendment or
incorporated by reference herein prior to the issuance of Depositary
Shares).
4-i Indenture, dated as of February 1, 1987, among Southwestern Bell
Capital Corporation, Southwestern Bell Corporation, and The Bank of
New York, Trustee (Exhibit 4-a to Registration Statement
No. 2-11669). The form or forms of Debt Securities with respect to
each particular series of Debt Securities will be filed as an exhibit
to a Current Report on Form 8-K of SBC Communications Inc. and
incorporated herein by reference.
4-j First Supplemental Indenture, dated October 1, 1990, among
Southwestern Bell Capital Corporation, Southwestern Bell Corporation
and The Bank of New York, Trustee (Exhibit 4-a to Form 8-K, dated
January 7, 1991, File 1-8610).
4-k Support Agreement between Southwestern Bell Capital Corporation and
Southwestern Bell Corporation (Exhibit 4-b to Registration Statement
No. 33-11669).
5-a* Opinion of Mr. James D. Ellis, Senior Executive Vice President and
General Counsel, SBC Communications Inc., as to the validity of the
Securities to be issued by SBC and the validity of the Support
Agreement.
<PAGE>
<PAGE> 32
5-b Opinion of Mr. Wayne Wirtz, Secretary of Southwestern Bell
Capital Corporation, as to the validity of the Debt Securities to be
issued by Capital and the validity of the Support Agreement.
12 Computation of Ratio of Earnings to Fixed Charges (Exhibit 12 to Form
10-Q for the first quarter 1995, File 1-8610).
23-a Consent of Ernst & Young LLP, Independent Auditors.
23-b Consent of Mr. James D. Ellis is contained in his opinion previously
filed as Exhibit 5-a.
23-c Consent of Mr. Wayne Wirtz is contained in his opinion filed as
Exhibit 5-b.
24-a* Powers of Attorney of SBC.
25-a* Form T-1 Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Trustee under the
Capital Indenture and the SBC Indenture.
___________________
* Previously filed.
ITEM 17. UNDERTAKINGS.
I. The undersigned registrants hereby undertake:
(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;
(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 (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 SBC
pursuant to section 13 or section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this
registration statement.
<PAGE>
<PAGE> 33
(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.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of SBC's annual report
pursuant to section 13(a) or section 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in 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.
II. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrants pursuant to the provisions
referred to in Item 15 or otherwise, the registrants have been
advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the registrants of expenses incurred or
paid by a director, officer or controlling person of the registrants
in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in
connection with the securities being registered, the registrants
will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by
the final adjudication of such issue.
<PAGE>
<PAGE> 34
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
AND ISSUER OF SECURITIES AND OBLIGOR PURSUANT TO THE SUPPORT AGREEMENT
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF
THE REQUIREMENTS FOR FILING FORM S-3 AND HAS DULY CAUSED THIS AMENDMENT TO
THE REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED,
THEREUNTO DULY AUTHORIZED, IN THE CITY OF SAN ANTONIO AND STATE OF TEXAS,
ON THE 10TH DAY OF MAY, 1995.
SBC Communications Inc.
By /s/ Donald E. Kiernan
Donald E. Kiernan
Senior Vice President, Treasurer
and Chief Financial Officer
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS AMENDMENT
TO THE REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING
PERSONS IN THE CAPACITIES AND ON THE DATE INDICATED.
Principal Executive Officer:
Edward E. Whitacre Jr.*
Chairman and Chief Executive Officer
Principal Financial and Accounting Officer:
Donald E. Kiernan, /s/ Donald E. Kiernan
Senior Vice President, Treasurer Donald E. Kiernan, as
and Chief Financial Officer attorney-in-fact for
Mr. Whitacre, the Directors
and on his own behalf as
Principal Financial Officer
and Principal Accounting
Officer
May 10, 1995
Directors:
Clarence C. Barksdale* Bobby R. Inman*
James E. Barnes* Charles F. Knight*
Jack S. Blanton* Sybil C. Mobley*
August A. Busch, III* Haskell M. Monroe, Jr.*
Ruben R. Cardenas* Carlos Slim Helu*
Martin K. Eby, Jr.* Patricia P. Upton*
Tom C. Frost* Edward E. Whitacre, Jr.*
Jess T. Hay*
- -------------------
*by power of attorney
<PAGE>
<PAGE> 35
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
AND ISSUER OF DEBT SECURITIES CERTIFIES THAT IT HAS REASONABLE GROUNDS TO
BELIEVE THAT IT MEETS ALL OF THE REQUIREMENTS FOR FILING FORM S-3 AND HAS
DULY CAUSED THIS AMENDMENT TO THE REGISTRATION STATEMENT TO BE SIGNED ON
ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF
SAN ANTONIO AND STATE OF TEXAS, ON THE 10TH DAY OF MAY, 1995.
SOUTHWESTERN BELL CAPITAL CORPORATION
By /s/ Donald E. Kiernan
Donald E. Kiernan
President
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS AMENDMENT
TO THE REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING
PERSONS IN THE CAPACITIES AND ON THE DATE INDICATED.
May 10, 1995 By /s/ Donald E. Kiernan
Donald E. Kiernan
President, Treasurer and
Director (principal executive
officer and principal financial
and accounting officer)
By /s/ Wayne Wirtz
Wayne Wirtz
Senior Vice President,
Secretary and Director
<PAGE>
<PAGE> 36
INDEX TO EXHIBITS
The exhibits identified in parentheses below, on file with the Securities
and Exchange Commission, are incorporated herein by reference as exhibits
hereto. On April 28, 1995, SBC filed an amendment to its Restated Certificate
of Incorporation with the Secretary of State of the State of Delaware
reflecting the change in its name from Southwestern Bell Corporation to SBC
Communications Inc. Except as otherwise noted, references herein to
"Southwestern Bell Corporation" are to the entity now known as "SBC
Communications Inc."
Exhibit
Number
1-a* Form of Underwriting Agreement for Debt Securities issued by
the Corporation.
1-b Form of Underwriting Agreement for Preferred Stock and/or
Depositary Shares (to be filed by post-effective amendment or
incorporated by reference herein prior to the issuance of
Preferred Stock and/or Depositary Shares).
1-c Form of Underwriting Agreement for Common Stock (to be filed by
post-effective amendment or incorporated by reference herein
prior to the issuance of Common Stock).
1-d Form of Selling Agency Agreement for Debt Securities issued by
Capital (Exhibit 1-b to Registration Statement No. 33-45490).
1-e* Form of Underwriting Agreement for Debt Securities issued by
Capital.
4-a* Form of Indenture, dated as of November 1, 1994, between
Southwestern Bell Corporation and The Bank of New York,
Trustee. The form or forms of Debt Securities with respect to
each particular series of Debt Securities will be filed as an
exhibit to a Current Report on Form 8-K of SBC Communications
Inc. and incorporated herein by reference.
4-b Restated Certificate of Incorporation of SBC Communications
Inc. (Exhibit 3 to Form 10-Q for the first quarter 1995, File
1-8610).
4-c Bylaws, as amended to date (Exhibit 3-b to Form 10-Q for the
second quarter 1991, File 1-8610).
4-d Rights Agreement (executed in the form as filed), dated as of
January 27, 1989, between Southwestern Bell Corporation and
American Transtech, Inc., the Rights Agent, which includes as
Exhibit B thereto the Form of Rights Certificate (Exhibit 4-a
to Form 8-A, dated February 9, 1989, File 1-8610).
4-e Amendment of Rights Agreement (executed in the form as filed),
dated as of August 5, 1992, between Southwestern Bell
Corporation, American Transtech, Inc., and The Bank of New
York, the successor Rights Agent, which includes the Form of
Rights Certificate as an attachment identified as Exhibit B
(Exhibit 4-a to Form 8-K, dated August 7, 1992, File 1-8610).
4-f Form of Rights Certificate (included in the attachment to the
Amendment of Rights Agreement and identified as Exhibit B)
(Exhibit 4-b to Form 8-K, dated August 7, 1992, File 1-8610).
<PAGE>
<PAGE> 37
4-g Second Amendment of Rights Agreement, dated as of June 15,
1994, between Southwestern Bell Corporation and The Bank of New
York, as successor Rights Agent (Exhibit 4-e to Form 8-A/A,
dated June 22, 1994, File 1-8610).
4-h Form of Deposit Agreement, including form of Depositary Receipt
for Depositary Shares (to be filed by post-effective amendment
or incorporated by reference herein prior to the issuance of
Depositary Shares).
4-i Indenture, dated as of February 1, 1987, among Southwestern
Bell Capital Corporation, Southwestern Bell Corporation and The
Bank of New York, Trustee (Exhibit 4-a to Registration
Statement No. 2-11669). The form or forms of Debt Securities
with respect to each particular series of Debt Securities will
be filed as an exhibit to a Current Report on Form 8-K of
SBC Communications Inc. and incorporated herein by reference.
4-j First Supplemental Indenture, dated October 1, 1990, among
Southwestern Bell Capital Corporation, Southwestern Bell
Corporation and The Bank of New York, Trustee (Exhibit 4-a to
Form 8-K, dated January 7, 1991, File 1-8610).
4-k Support Agreement between Southwestern Bell Capital Corporation
and Southwestern Bell Corporation (Exhibit 4-b to Registration
Statement No. 33-11669).
5-a* Opinion of Mr. James D. Ellis, Senior Executive Vice President
and General Counsel, SBC Communication Inc., as to the validity
of the Securities to be issued by SBC and the validity of the
Support Agreement.
5-b Opinion of Mr. Wayne Wirtz, Secretary of Southwestern Bell
Capital Corporation, as to the validity of the Debt Securities
to be issued by Capital and the validity of the Support
Agreement.
12 Computation of Ratio of Earnings to Fixed Charges (Exhibit 12
to Form 10-Q for the first quarter 1995, File 1-8610).
23-a Consent of Ernst & Young LLP, Independent Auditors.
23-b Consent of Mr. James D. Ellis is contained in his opinion
previously filed as Exhibit 5-a.
23-c Consent of Mr. Wayne Wirtz is contained in his opinion
filed as Exhibit 5-b.
<PAGE>
<PAGE> 38
24-a* Powers of Attorney of SBC.
25-a* Form T-1 Statement of Eligibility under the Trust Indenture Act
of 1939, as amended, of The Bank of New York, as Trustee under
the Capital Indenture and the SBC Indenture.
________________________
* Previously filed.
<PAGE> 1
Exhibit 5-b
[SBC Communications Inc.]
May 10, 1995
Southwestern Bell Capital Corporation
175 E. Houston Street
San Antonio, TX 78205
Dear Sirs:
With reference to the Registration Statement on Form S-3 which
SBC Communications Inc. ("SBC") and Southwestern Bell Capital
Corporation ("Capital Corporation") propose to file with the Securities and
Exchange Commission under the Securities Act of 1933, as amended, relating
to (i) Capital Corporation's Debt Securities (the "Securities"), issuable
in series under an Indenture dated as of February 1, 1987, as supplemented
by a First Supplemental Indenture, dated as of October 1, 1990 (together,
the "Indenture"), among Capital Corporation, SBC, as issuer of support
obligations pursuant to the Support Agreement dated November 10, 1988 (the
"Support Agreement") between Capital Corporation and SBC, and The Bank of
New York, as Trustee (the "Trustee"), (ii) debt securities of SBC, issuable
in series under an Indenture dated as of November 1, 1994, between SBC and
the Trustee, (iii) shares of preferred stock, par value $1.00 per share, of
SBC, (iv) depositary shares representing fractional interests in shares of
preferred stock, par value $1.00 per share, of SBC, and (v) shares of common
stock, par value $1.00 per share, of SBC, and having an aggregate maximum
public offering price of $3,000,000,000 I am of the opinion that:
1. Capital Corporation has been duly incorporated and is
validly existing and in good standing under the laws of the State of
Delaware.
2. Each series of the Securities, when duly established by or
pursuant to a resolution of Capital Corporation's Board of Directors or in
a supplemental indenture, in each case so as not to violate any applicable
law or any agreement or instrument to which Capital Corporation is a party or
by which it is bound, and duly executed, authenticated and issued as provided
in the Indenture and delivered against payment, will constitute valid and
legally binding obligations of Capital Corporation entitled to the benefits
of the Indenture.
3. The Support Agreement has been duly authorized, executed
and delivered by Capital Corporation and constitutes a valid and legally
binding agreement of Capital Corporation.
I hereby consent to the filing of this opinion with the
Securities and Exchange Commission in connection with the filing of the
Registration Statement referred to above and the making of the statements
with respect to me which are set forth under the caption "Legal Opinions"
in the prospectus forming a part of the Registration Statement referred to
above.
In giving this consent, I do not thereby admit that I am within
the category of persons whose consent is required under Section 7 of the
Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission.
Sincerely,
/s/ Wayne Wirtz
<PAGE> 1
Exhibit 23-a
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Experts" in
Amendment No. 1 to the Registration Statement on Form S-3 of Southwestern
Bell Capital Corporation and SBC Communications Inc. and related Prospectus
for the registration of debt securities, preferred stock, depositary shares,
and common stock of SBC Communications Inc. and debt securities of
Southwestern Bell Capital Corporation having an aggregate maximum public
offering price of $3,000,000,000 and to the incorporation by reference
therein of our reports dated February 10, 1995 with respect to the
consolidated financial statements of SBC Communications Inc. incorporated
by reference in its Annual Report (Form 10-K) for the year ended December 31,
1994 and the related financial statement schedules included therein filed
with the Securities and Exchange Commission.
/s/ ERNST & YOUNG LLP
ERNST & YOUNG LLP
San Antonio, Texas
May 5, 1995
