<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 18, 1995
REGISTRATION NO. 33-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
PACIFIC GAS AND ELECTRIC COMPANY PG&E CAPITAL I
(EXACT NAME OF REGISTRANT AS PG&E CAPITAL II
SPECIFIED IN CHARTER) PG&E CAPITAL III
PG&E CAPITAL IV
(EXACT NAME OF REGISTRANTS AS
SPECIFIED IN TRUST AGREEMENTS)
CALIFORNIA DELAWARE
(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION)
94-0742640 (TO BE APPLIED FOR)
(I.R.S. EMPLOYER IDENTIFICATION NO.)
77 BEALE STREET
P. O. BOX 770000
SAN FRANCISCO, CALIFORNIA 94177
(415) 973-7000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANTS' PRINCIPAL EXECUTIVE OFFICES)
GARY P. ENCINAS, ESQ.
77 BEALE STREET
P. O. BOX 770000
SAN FRANCISCO, CALIFORNIA 94177
(415) 973-2784
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: After the
Registration Statement becomes effective, as determined by market conditions
and other factors.
---------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, please check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act Registration Statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
---------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
====================================================================================================================
PROPOSED
PROPOSED MAXIMUM
AMOUNT MAXIMUM AGGREGATE AMOUNT OF
TITLE OF EACH CLASS OF TO BE OFFERING PRICE OFFERING REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED(1) PER UNIT(2)(3) PRICE(2)(3) FEE
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PG&E Capital I, II, III and IV
Cumulative Quarterly Income
Preferred Securities...............................
-----------------------------------------------------------------------------------------------------------------------
Pacific Gas and Electric Company
Guarantees with respect to Preferred Securities....
-----------------------------------------------------------------------------------------------------------------------
Pacific Gas and Electric Company
Deferrable Interest
Subordinated Debentures............................
-----------------------------------------------------------------------------------------------------------------------
Total................................................ $335,000,000 100% $335,000,000 $115,517.24
=======================================================================================================================
</TABLE>
(1) There are being registered hereunder a presently indeterminate number of
Cumulative Quarterly Income Preferred Securities of PG&E Capital I, II,
III and IV with an aggregate initial public offering price not to exceed
$335,000,000 and related Guarantees and Deferrable Interest Subordinated
Debentures of Pacific Gas and Electric Company for which no separate
consideration will be received.
(2) Estimated solely for the purpose of determining the registration fee.
(3) Pursuant to Rule 457(n) and (o), the registration fee is calculated on the
basis of the proposed maximum offering price of the Cumulative Quarterly
Income Preferred Securities.
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.
================================================================================
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ 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. NEITHER THIS PROSPECTUS SUPPLEMENT NOR THE PROSPECTUS TO +
+ WHICH IT RELATES SHALL CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN +
+ OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN +
+ WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO +
+ REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED , 1995
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED , 1995
PREFERRED SECURITIES
PG&E CAPITAL I
% CUMULATIVE QUARTERLY INCOME PREFERRED SECURITIES (QUIPS /SM/)*,
SERIES A
(LIQUIDATION PREFERENCE $25 PER PREFERRED SECURITY)
GUARANTEED TO THE EXTENT THE SERIES A ISSUER HAS FUNDS AS SET FORTH HEREIN BY
PACIFIC GAS AND ELECTRIC COMPANY
-----------
The % Cumulative Quarterly Income Preferred Securities, Series A (the
"Series A Preferred Securities"), offered hereby represent preferred undivided
beneficial interests in the assets of PG&E Capital I, a statutory business
trust formed under the laws of the State of Delaware (the "Series A Issuer").
PG&E will be the owner of the beneficial interests represented by Common
Securities of the Series A Issuer. The First National Bank of Chicago is the
Property Trustee of the Series A Issuer. The Series A Issuer exists for the
sole purpose of issuing its trust interests and investing the proceeds thereof
in % Deferrable Interest Subordinated Debentures, Series A, Due 2025 (the
"Series A Debentures") to be issued by PG&E. The preferred interests
represented by the Series A Preferred Securities will have a preference under
certain circumstances with respect to cash distributions and amounts payable on
liquidation, redemption or otherwise over the trust interests represented by
the Common Securities of the Series A Issuer. See "Description of the Preferred
Securities--Subordination of Common Securities" in the accompanying Prospectus.
Holders of the Series A Preferred Securities will be entitled to receive
cumulative cash Distributions accruing from the date of original issuance and
payable quarterly in arrears on March 31, June 30, September 30 and December 31
of each year, commencing , 1995, at the rate of % per annum, payable from
amounts received by the Series A Issuer as interest on the Series A Debentures.
So long as an Event of Default under the Indenture has not occurred and is
continuing, PG&E has the right to defer payments of interest on the Series A
Debentures by extending the interest payment period thereon at any time for up
to 20 consecutive
(Continued on next page)
-----------
SEE "RISK FACTORS" AT PAGE S-4 HEREOF FOR CERTAIN INFORMATION RELEVANT TO AN
INVESTMENT IN THE SERIES A PREFERRED SECURITIES, INCLUDING THE PERIOD AND
CIRCUMSTANCES DURING WHICH PAYMENT OF DISTRIBUTIONS ON THE SERIES A PREFERRED
SECURITIES AND SERIES A DEBENTURES MAY BE DEFERRED AND THE RELATED FEDERAL
INCOME TAX CONSEQUENCES.
-----------
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
SUPPLEMENT OR THE PROSPECTUS TO WHICH IT RELATES.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
-----------
<TABLE>
<CAPTION>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO THE
OFFERING PRICE COMMISSION(1) SERIES A ISSUER(2)(3)
-------------- ------------- ---------------------
<S> <C> <C> <C>
Per Series A Preferred Security..... $ (2) $
Total(4)............................ $ (2) $
</TABLE>
-----
(1) The Series A Issuer and PG&E have agreed to indemnify the several
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933. See "Underwriting".
(2) In view of the fact that the proceeds of the sale of the Series A Preferred
Securities will be used to purchase the Series A Debentures, the
Underwriting Agreement provides that PG&E will pay to the Underwriters, as
compensation ("Underwriters' Compensation") for their arranging the
investment therein of such proceeds, $ per Series A Preferred Security
(or $ in the aggregate). See "Underwriting".
(3) Expenses of the offering, which are payable by PG&E, are estimated to be
$ .
(4) The Series A Issuer and PG&E have granted the Underwriters an option for 30
days to purchase up to an additional Series A Preferred Securities at
the initial public offering price per Series A Preferred Security solely to
cover over-allotments. PG&E will pay Underwriters' Compensation in the
amounts per Series A Preferred Security set forth in Note 2 with respect to
such additional Series A Preferred Securities. If such option is exercised
in full, the total Initial Public Offering Price, Underwriting Commission
and Proceeds to the Series A Issuer will be $ , $ and $ ,
respectively. See "Underwriting".
-----------
The Series A Preferred Securities offered hereby are offered severally by the
Underwriters, as specified herein and subject to receipt and acceptance by them
and subject to their right to reject any order in whole or in part. It is
expected that delivery of the Series A Preferred Securities will be made only
in book-entry form through the facilities of DTC on or about , 1995.
-----
* QUIPS is a service mark of Goldman, Sachs & Co.
-----------
The date of this Prospectus Supplement is , 1995.
<PAGE>
(Continued from previous page)
quarters (each an "Extension Period"). If and for so long as interest payments
are so deferred, Distributions on the Series A Preferred Securities will also
be deferred. During an Extension Period, Distributions will continue to
accrue, and holders of Series A Preferred Securities will be required to
accrue interest income for United States federal income tax purposes. See
"Certain Terms of the Series A Debentures--Option to Extend Interest Payment
Period" and "United States Taxation--Potential Extension of Interest Payment
Period and Original Issue Discount".
The payment of Distributions and payments on liquidation of the Series A
Issuer or the redemption of the Series A Preferred Securities, as set forth
below, in each case out of funds held by the Series A Issuer are guaranteed by
PG&E under a Guarantee Agreement (the "Series A Guarantee") to the extent
described herein. If PG&E fails to make interest payments on the Series A
Debentures held by the Series A Issuer, the Series A Issuer will have
insufficient funds to pay Distributions on the Series A Preferred Securities.
The Series A Guarantee does not cover payment of Distributions when the Series
A Issuer does not have sufficient funds on hand available to pay such
Distributions. In such event, the remedy of a holder of Series A Preferred
Securities is to require the Property Trustee to enforce the rights of the
Series A Issuer under the Series A Debentures held by the Series A Issuer. The
obligations of PG&E under the Series A Guarantee are subordinate and junior in
right of payment to all liabilities of PG&E except those made pari passu or
subordinate to the Series A Guarantee expressly by their terms.
The Series A Preferred Securities are subject to mandatory redemption upon
repayment of the Series A Debentures at maturity or their earlier redemption.
PG&E will have the option at any time on or after , 2000 to redeem, in
whole or in part, the Series A Debentures. PG&E also will have the right at
any time, upon occurrence of a Special Event (as defined herein), to redeem,
in whole but not in part, the Series A Debentures. See "Certain Terms of the
Series A Debentures--Redemption".
The Series A Debentures are subordinate and junior in right of payment to
all Senior Indebtedness of PG&E. As of June 30, 1995, PG&E had approximately
$9 billion of principal amount of Senior Indebtedness. The terms of the Series
A Debentures do not limit PG&E's ability to incur additional Senior
Indebtedness. See "Description of the Debentures--Subordination" in the
accompanying Prospectus.
In the event of the liquidation of the Series A Issuer, the holders of the
Series A Preferred Securities will be entitled to receive a stated liquidation
preference of $25 per Series A Preferred Security plus accrued and unpaid
Distributions thereon to the date of payment, unless, in connection with such
liquidation, Series A Debentures are distributed to the holders of the Series
A Preferred Securities, subject to certain limitations. See "Description of
the Preferred Securities--Liquidation Distribution Upon Termination" in the
accompanying Prospectus.
Application will be made to list the Series A Preferred Securities on the
Stock Exchange.
The Series A Preferred Securities will be represented by global certificates
registered in the name of DTC or its nominee. Beneficial interests in the
Series A Preferred Securities will be shown on, and transfers thereof will be
effected only through, records maintained by participants in DTC. Except as
described in the accompanying Prospectus, Series A Preferred Securities in
certificated form will not be issued in exchange for the global certificates.
See "Description of the Preferred Securities--Book-Entry-Only Issuance--The
Depository Trust Company" in the accompanying Prospectus.
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SERIES A
PREFERRED SECURITIES AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN
THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE EXCHANGE, IN
THE OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY
BE DISCONTINUED AT ANY TIME.
S-2
<PAGE>
PROSPECTUS SUMMARY
The following summary information is qualified in its entirety by the
detailed information and financial statements incorporated herein by reference.
THE OFFERING
<TABLE>
<S> <C>
Securities Offered.............................. % Cumulative Quarterly Income Preferred
Securities, Series A
Distribution Payment Dates...................... March 31, June 30, September 30 and
December 31, commencing , 1995,
subject to deferral as described herein
Redemption...................................... As set forth on the Prospectus Supplement
cover
Use of Proceeds................................. Capital expenditures and the redemption,
repurchase, repayment or retirement of
outstanding indebtedness or preferred stock
THE COMPANY
Principal Business.............................. Supplying electric and natural gas service
Utility Service Area............................ Most of Northern and Central California
Estimated Population of Utility Service Area
(December 31, 1994)............................ 13,000,000
</TABLE>
CONSOLIDATED FINANCIAL INFORMATION
(DOLLAR AMOUNT IN THOUSANDS)
<TABLE>
<CAPTION>
UNAUDITED
SIX MONTHS
YEARS ENDED DECEMBER 31, ENDED
--------------------------------------------------------- JUNE 30,
1990 1991 1992 1993 1994 1995
---------- ---------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Operating Revenues...... $9,470,092 $9,778,119 $10,296,088 $10,582,408 $10,447,351 $4,755,081
Net Income.............. $ 987,170 $1,026,392 $ 1,170,581 $ 1,065,495 $ 1,007,450 $ 734,207
Ratios of Earnings to
Combined Fixed Charges
and Preferred Stock
Dividends*............. 2.68x 2.85x 3.03x 2.85x 3.08x 3.97x
</TABLE>
--------
*See "Coverage Ratios."
<TABLE>
<CAPTION>
AS OF JUNE 30, 1995
----------------------
(UNAUDITED)
AMOUNT PERCENTAGE
----------- ----------
<S> <C> <C>
Common Stock Equity...................................... $ 8,729,259 48.9%
Preferred Stock Without Mandatory Redemption............. 732,995 4.1
Preferred Stock With Mandatory Redemption................ 137,500 0.8
Long-term Debt........................................... 8,250,722 46.2
----------- -------
Total Capitalization................................. $17,850,476 100.0%
=========== =======
Current Liabilities:
Long-term Debt......................................... $ 416,939
Short-term Borrowings.................................. $ 210,000
</TABLE>
S-3
<PAGE>
The following information supplements and should be read in conjunction with
the information contained in the accompanying Prospectus. Each of the
capitalized terms used in this Prospectus Supplement has the meaning set forth
in this Prospectus Supplement or in the accompanying Prospectus.
RISK FACTORS
Prospective purchasers of the Series A Preferred Securities should carefully
review the information contained elsewhere in this Prospectus Supplement and
in the accompanying Prospectus and should particularly consider the following
matters:
SUBORDINATED OBLIGATIONS UNDER THE SERIES A GUARANTEE AND THE SERIES A
DEBENTURES
The obligations of PG&E under the Series A Guarantee issued by PG&E for the
benefit of the holders of Series A Preferred Securities are subordinate and
junior in right of payment to all liabilities of PG&E except those made pari
passu or subordinate to the Series A Guarantee expressly by their terms.
PG&E's obligations under the Series A Debentures are subordinate and junior in
right of payment to all Senior Indebtedness of PG&E. At June 30, 1995, the
Senior Indebtedness of PG&E aggregated approximately $9 billion. There are no
terms in the Series A Preferred Securities, the Series A Debentures or the
Series A Guarantee that limit PG&E's ability to incur additional indebtedness,
including indebtedness that ranks senior to the Series A Debentures and the
Series A Guarantee. See "Description of the Guarantee--Status of the
Guarantee" and "Description of the Debentures--Subordination" in the
accompanying Prospectus.
The ability of the Series A Issuer to pay amounts due on the Series A
Preferred Securities is entirely dependent upon PG&E making payments on the
Series A Debentures as and when required.
OPTION TO EXTEND INTEREST PAYMENT PERIOD; TAX CONSEQUENCES
So long as an Event of Default under the Indenture has not occurred and is
continuing, PG&E has the right at any time and from time to time to extend
interest payment periods on the Series A Debentures for up to 20 consecutive
quarters, and, as a consequence, quarterly Distributions on the Series A
Preferred Securities will be deferred by the Series A Issuer during any
Extension Period. Distributions in arrears after the quarterly payment date
therefor will accumulate additional distributions thereon at the rate per
annum of % thereof (to the extent permitted by law). In the event PG&E
exercises its right to extend the interest payment periods on the Series A
Debentures, PG&E will not, and will not permit any subsidiary of PG&E to,
declare or pay any dividend or distribution on, or redeem, purchase, acquire,
or make a liquidation or guarantee payment (other than payments under a
Guarantee) with respect to, any shares of PG&E's capital stock or any other
security of PG&E (including other Debentures) ranking pari passu with or
junior in interest to the Series A Debentures, except (i) in each case with
securities junior in interest to the Series A Debentures or (ii) for payments
made on any series of Debentures upon the stated maturity of such Debentures.
As a result, this covenant requires that an interest payment on one series of
Debentures may be extended only if the interest periods on all series of
Debentures are likewise extended. See "Certain Terms of the Series A Preferred
Securities--Distributions" and "Certain Terms of the Series A Debentures--
Option to Extend Interest Payment Period."
Should an Extension Period occur, the Series A Issuer will continue to
accrue income for United States federal income tax purposes which will be
allocated, but not distributed, to holders of the Series A Preferred
Securities. As a result, a holder of Series A Preferred Securities will
include such interest in gross income for United States federal income tax
purposes in advance of the receipt of cash, and will not receive the cash
related to such income if the holder disposes of the Series A Preferred
S-4
<PAGE>
Securities prior to the record date for the payment of Distributions. See
"United States Taxation--Potential Extension of Interest Payment Period and
Original Issue Discount."
PG&E has no current intention of exercising its right to defer payments of
interest by extending the interest payment period on the Series A Debentures.
However, should PG&E determine to exercise such right in the future, the
market price of the Series A Preferred Securities is likely to be affected. A
holder that disposes of its Series A Preferred Securities during an Extension
Period, therefore, might not receive the same return on its investment as a
holder that continues to hold its Series A Preferred Securities. In addition,
as a result of the existence of PG&E's right to defer interest payments, the
market price of the Series A Preferred Securities (which represent an
undivided beneficial interest in the Series A Debentures) may be more volatile
than other securities on which original issue discount accrues that do not
have such rights.
SPECIAL EVENT REDEMPTION OR DISTRIBUTION
Upon the occurrence and continuation of a Special Event, as described in
"Certain Terms of the Series A Preferred Securities--Special Event Redemption
or Distribution," PG&E has the right to (i) redeem the Series A Debentures and
therefore cause a mandatory redemption of the Series A Preferred Securities or
(ii) terminate the Series A Issuer and cause the Series A Debentures to be
distributed to the holders of the Series A Preferred Securities in liquidation
of such holders' interests in the Series A Issuer. See "Certain Terms of the
Series A Debentures--Redemption."
RIGHTS UNDER THE SERIES A GUARANTEE
The Series A Guarantee will be qualified as an indenture under the Trust
Indenture Act. The First National Bank of Chicago will act as the Guarantee
Trustee under the Series A Guarantee for the purposes of compliance with the
Trust Indenture Act. The Guarantee Trustee will hold the Series A Guarantee
for the benefit of the holders of the Series A Preferred Securities and will
also be the trustee for the Series A Debentures and the Property Trustee.
The Series A Guarantee guarantees on a subordinated basis to the holders of
the Series A Preferred Securities the payment (but not the collection) of (i)
any accrued and unpaid Distributions required to be paid on the Series A
Preferred Securities, if and only to the extent the Series A Issuer has funds
on hand available therefor, (ii) the Redemption Price, including all accrued
and unpaid Distributions to the date of redemption, with respect to Series A
Preferred Securities called for redemption by the Series A Issuer to the
extent the Series A Issuer has funds on hand available therefor, and (iii)
upon a voluntary or involuntary termination, winding-up or liquidation of the
Series A Issuer (unless the Series A Debentures are distributed to holders of
Series A Preferred Securities), (a) the aggregate liquidation preference of
$25 per Series A Preferred Security plus all accrued and unpaid Distributions
on the Series A Preferred Securities to the date of payment, to the extent the
Series A Issuer has funds on hand available to make such payment or, if
different, (b) the amount of assets of the Series A Issuer remaining available
for distribution to holders of the Series A Preferred Securities in
liquidation of the Series A Issuer. The holders of not less than a majority in
aggregate liquidation preference of the Series A Preferred Securities have the
right to direct the time, method and place of conducting any proceeding for
any remedy available to the Guarantee Trustee or to direct the exercise of any
trust or power conferred upon the Guarantee Trustee under the Series A
Guarantee. If the Guarantee Trustee fails to enforce the Series A Guarantee,
any holder of Series A Preferred Securities may, after a period of 30 days has
elapsed from such holder's written request to the Guarantee Trustee to enforce
the Series A Guarantee, institute a legal proceeding directly against PG&E to
enforce its rights under the Series A Guarantee without first instituting a
legal proceeding against the Guarantee Trustee, the Series A Issuer or any
other person or entity. If PG&E were to default on its obligations under the
Series A Debentures, the Series A Issuer would lack available funds for the
payment of Distributions or amounts payable on redemption of the Series A
Preferred
S-5
<PAGE>
Securities or otherwise, and in such event holders of the Series A Preferred
Securities would not be able to rely upon the Series A Guarantee for payment
of such amounts. Instead, holders of the Series A Preferred Securities would
be required to rely on the enforcement by the Property Trustee of its rights,
as registered holder of the Series A Debentures, against PG&E pursuant to the
terms of the Series A Debentures. See "Description of the Guarantee--Status of
the Guarantee" and "Description of the Debentures--Subordination" in the
accompanying Prospectus. The Amended and Restated Trust Agreement of the
Series A Issuer, among PG&E, as sponsor, and the Issuer Trustees (as defined
below) (the "Series A Trust Agreement") provides that each holder of Series A
Preferred Securities by acceptance thereof agrees to the provisions of the
Series A Guarantee and the Indenture.
LIMITED VOTING RIGHTS
Holders of Series A Preferred Securities will have limited voting rights
and, except upon the occurrence of an Event of Default under the Trust
Agreement as a result of an event of default under the Indenture (a "Debenture
Event of Default"), will not be entitled to vote to appoint, remove or replace
the Property Trustee or the Delaware Trustee, which voting rights are vested
exclusively in the holder of trust interests represented by Common Securities
unless and until a Debenture Event of Default has occurred and is continuing.
In no event will the holders of the Series A Preferred Securities have the
right to vote to appoint, remove or replace the Administrative Trustees, which
voting rights are vested exclusively in the holder of the Common Securities.
See "Description of the Preferred Securities--Events of Default; Notice" in
the accompanying Prospectus.
TRADING CHARACTERISTICS OF SERIES A PREFERRED SECURITIES
Application will be made to list the Series A Preferred Securities on the
Stock Exchange. If approved for listing, the Series A Preferred Securities
are expected to trade at a price that takes into account the value, if any, of
accrued and unpaid Distributions; thus, purchasers will not pay and sellers
will not receive any accrued and unpaid interest with respect to their
undivided beneficial interests in Series A Debentures owned through the Series
A Preferred Securities that is not included in the trading price of the Series
A Preferred Securities. However, interest on the Series A Debentures will be
included in the gross income of U.S. holders of Series A Preferred Securities
as it accrues, rather than when it is paid. See "United States Taxation--
Income from Series A Preferred Securities."
PG&E CAPITAL I
PG&E Capital I is a statutory business trust formed under Delaware law. The
Series A Issuer's business and affairs are conducted by five Issuer Trustees:
The First National Bank of Chicago, as Property Trustee, an individual who is
a resident of Delaware and an employee of an affiliate of the Property
Trustee, as Delaware Trustee, and three individual Administrative Trustees who
are employees or officers of or affiliated with PG&E. The exclusive business
of the Series A Issuer is issuing the Series A Preferred Securities and the
Common Securities representing undivided beneficial interests in the assets of
the Series A Issuer, using the proceeds of the sale of the Series A Preferred
Securities and the Common Securities to acquire the Series A Debentures and
engaging in only those other activities that are necessary or incidental
thereto. All of the Common Securities of the Series A Issuer will be owned
directly or indirectly by PG&E. The Common Securities of the Series A Issuer
will rank pari passu, and payments will be made thereon pro rata, with the
Series A Preferred Securities, except that upon the occurrence and continuance
of a Debenture Event of Default under the Series A Trust Agreement, the rights
of PG&E, as holder of the Common Securities of the Series A Issuer, to payment
in respect of Distributions and payments upon liquidation or redemption will
be subordinated to the rights of the holders of the Series A Preferred
Securities. The principal place of business of the Series A Issuer is c/o
Pacific Gas and Electric Company, 77 Beale Street, P. O. Box 770000, San
Francisco, California 94177 and its telephone number is (415) 973-7000.
S-6
<PAGE>
PACIFIC GAS AND ELECTRIC COMPANY
Pacific Gas and Electric Company is an operating public utility engaged
principally in the business of supplying electric and natural gas service
throughout most of northern and central California. PG&E was incorporated in
California in 1905. Its principal executive office is located at 77 Beale
Street, P.O. Box 770000, San Francisco, California 94177, and its telephone
number is (415) 973-7000.
COVERAGE RATIOS
The following table sets forth the unaudited ratios of earnings to fixed
charges of PG&E and its subsidiaries for each of the years 1990 through 1994
and for the six months ended June 30, 1995.
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31, SIX MONTHS
------------------------------------------------------------------ ENDED
1990 1991 1992 1993 1994 JUNE 30, 1995
---- ----- ----- ----- ----- -------------
<S> <C> <C> <C> <C> <C>
3.27 3.43 3.54 3.22 3.51 4.47
</TABLE>
For the purpose of computing PG&E and its subsidiaries' ratios of earnings
to fixed charges, "earnings" represent net income adjusted for the minority
interest in losses of less than 100% owned affiliates, PG&E and its
subsidiaries' equity in undistributed income or loss of less than 50% owned
affiliates, income taxes and fixed charges (excluding capitalized interest).
"Fixed charges" include interest on long-term debt and short-term borrowings
(including a representative portion of rental expense), amortization of bond
premium, discount and expense, interest on capital leases and the pretax
earnings required to cover the preferred stock dividend requirements of
majority owned subsidiaries.
The following table sets forth the unaudited ratios of earnings to combined
fixed charges and preferred stock dividends for each of the years 1990 through
1994 and the six months ended June 30, 1995.
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31, SIX MONTHS
------------------------------------------------------------------ ENDED
1990 1991 1992 1993 1994 JUNE 30, 1995
---- ----- ----- ----- ----- -------------
<S> <C> <C> <C> <C> <C>
2.68 2.85 3.03 2.85 3.08 3.97
</TABLE>
For the purpose of computing PG&E and its subsidiaries' ratios of earnings
to combined fixed charges and preferred stock dividends, "earnings" represent
net income adjusted for the minority interest in losses of less than 100%
owned affiliates, PG&E and its subsidiaries' equity in undistributed income or
loss of less than 50% owned affiliates, income taxes and fixed charges
(excluding capitalized interest). "Fixed charges" include interest on long-
term debt and short-term borrowings (including a representative portion of
rental expense), amortization of bond premium, discount and expense, interest
on capital leases and the pretax earnings required to cover the preferred
stock dividend requirements of majority owned subsidiaries. "Preferred stock
dividends" represent the sum of requirements for preferred stock dividends
that are deductible for federal income tax purposes and requirements for
preferred stock dividends that are not deductible for federal income tax
purposes increased to an amount representing pretax earnings which would be
required to cover such dividend requirements.
USE OF PROCEEDS
The net proceeds from the sale of the Series A Preferred Securities will be
used by the Series A Issuer to purchase Series A Debentures. The net proceeds
of the sale of the Series A Debentures by PG&E will become part of the
treasury funds of PG&E and will be applied to capital expenditures and to the
redemption, repurchase, repayment or retirement of outstanding indebtedness or
preferred stock.
S-7
<PAGE>
CERTAIN TERMS OF THE SERIES A PREFERRED SECURITIES
GENERAL
The following summary of certain terms and provisions of the Series A
Preferred Securities supplements the description of the terms and provisions
of the Preferred Securities set forth in the accompanying Prospectus under the
heading "Description of the Preferred Securities," to which description
reference is hereby made. This summary of certain terms and provisions of the
Series A Preferred Securities does not purport to be complete and is subject
to, and qualified in its entirety by reference to, the Trust Agreement. The
form of the Trust Agreement has been filed as an exhibit to the Registration
Statement of which this Prospectus Supplement and accompanying Prospectus is a
part.
DISTRIBUTIONS
The Series A Preferred Securities represent undivided beneficial interests
in the assets of the Series A Issuer, and as a practical matter the
Distributions on each Series A Preferred Security will be payable at the
annual rate of % of the stated liquidation preference of $25, payable
quarterly in arrears on March 31, June 30, September 30 and December 31 of
each year. Distributions in arrears after the quarterly payment date therefor
will accumulate additional Distributions thereon (to the extent permitted by
law) compounded quarterly at the rate per annum of % thereof. The term
"Distributions" as used herein shall include any such additional
Distributions. Distributions will accrue from , 1995, the date of original
issuance. The first Distribution payment date for the Series A Preferred
Securities will be , 1995, and such Distribution will be cumulative from
the date of original issuance. The amount of Distributions payable for any
period will be computed on the basis of a 360-day year of twelve 30-day
months.
So long as an Event of Default under the Indenture has not occurred and is
continuing, PG&E has the right at any time and from time to time to extend the
interest payment period on the Series A Debentures, for not more than 20
consecutive quarters, provided that any such Extension Period shall not extend
beyond the maturity date or redemption date of the Series A Debentures. As a
consequence, quarterly Distributions on the Series A Preferred Securities
would be deferred by the Series A Issuer during any Extension Period (but
would continue to accumulate additional Distributions thereon as set forth
above). In the event that PG&E exercises this right, PG&E will not, and will
not permit any subsidiary of PG&E to, declare or pay any dividend or
distribution on, or redeem, purchase, acquire, or make a liquidation or
guarantee payment (other than payments under a Guarantee) with respect to, any
shares of PG&E's capital stock or any security of PG&E (including other
Debentures) ranking pari passu with or junior in interest to the Series A
Debentures, except (i) in each case with securities junior in interest to the
Series A Debentures or (ii) for payments made on any series of Debentures upon
the stated maturity of such Debentures. As a result, this covenant requires
that an interest payment on one series of Debentures may be extended only if
the interest periods on all series of Debentures are likewise extended. Prior
to the termination of any such extended interest payment period, PG&E may
further extend the interest payment period, provided that such Extension
Period together with all such previous and further extensions thereof may not
exceed 20 consecutive quarters or extend beyond the maturity or redemption
date of the Series A Debentures. Upon the termination of any extension period
and the payment of all amounts then due, PG&E may select a new extended
interest payment period, subject to the above requirements. See "United States
Taxation--Potential Extension of Interest Payment Period and Original Issue
Discount" and "Certain Terms of the Series A Debentures--Option to Extend
Interest Payment Period."
PG&E has no current intention of exercising its right to defer payments of
interest by extending the interest payment period on the Series A Debentures.
S-8
<PAGE>
REDEMPTION
Upon the payment of the Series A Debentures, whether at maturity or upon
earlier redemption as provided in the Indenture, the proceeds from such
payment will be applied by the Property Trustee to redeem a Like Amount (as
defined below) of the Common Securities of the Series A Issuer and the Series
A Preferred Securities, upon not less than 30 nor more than 60 days' notice,
at a Redemption Price equal to the aggregate liquidation preference plus
accumulated and unpaid Distributions to the Redemption Date. See "Certain
Terms of the Series A Debentures--Redemption."
PG&E has the right to redeem the Series A Debentures (a) on or after ,
2000, in whole or in part, or (b) at any time, in whole but not in part, on
occurrence of a Tax Event or an Investment Company Event (each as defined
below, a "Special Event"), subject to the conditions described under "Certain
Terms of the Series A Debentures--Redemption."
SPECIAL EVENT REDEMPTION OR DISTRIBUTION
If a Special Event shall occur and be continuing with respect to the Series
A Issuer or the Series A Preferred Securities, PG&E has the right to (i)
redeem the Series A Debentures in whole (but not in part) and therefore cause
a mandatory redemption of the Series A Preferred Securities in whole (but not
in part) at the Redemption Price within 90 days following the occurrence of
such Special Event, or (ii) terminate the Series A Issuer and cause the Series
A Debentures to be distributed to the holders of the Series A Preferred
Securities in liquidation of the Series A Issuer. If at any time the Series A
Issuer is not or will not be taxed as a grantor trust but a Tax Event has not
occurred, the Depositor has the right to terminate the Series A Issuer and
cause the Series A Debentures to be distributed to the holders of the Series A
Preferred Securities in liquidation of the Series A Issuer. Under current
United States federal income tax law and interpretation and assuming the
Series A Trust is treated as a grantor trust, such a distribution should not
be a taxable event to holders of the Series A Preferred Securities. Should
there be a change in law, a change in legal interpretation, a Special Event or
other circumstances, however, the termination could be a taxable event to
holders of the Series A Preferred Securities. See "United States Taxation--
Receipt of Series A Debentures Upon Liquidation of the Series A Issuer." If
PG&E does not elect either option (i) or (ii) above, the Series A Preferred
Securities will remain outstanding.
"Tax Event" means that PG&E shall have received an opinion of counsel (which
may be counsel to PG&E or an affiliate but not an employee thereof and which
must be acceptable to the Property Trustee) experienced in such matters to the
effect that, as a result of any amendment to, or change (including any
announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or
therein affecting taxation, or as a result of any official administrative
pronouncement or judicial decision interpreting or applying such laws or
regulations, which amendment or change is effective or such pronouncement or
decision is announced on or after the date of original issuance of the Series
A Preferred Securities, there is more than an insubstantial risk that (i) the
Series A Issuer is, or will be, subject to United States federal income tax
with respect to interest received on the Series A Debentures, (ii) interest
payable by PG&E on the Series A Debentures is not, or will not be, deductible
for United States federal income tax purposes or (iii) the Series A Issuer is,
or will be, subject to more than a de minimis amount of other taxes, duties,
assessments or other governmental charges.
"Investment Company Event" means the occurrence of a change in law or
regulation or a change in interpretation or application of law or regulation
by any legislative body, court, governmental agency or regulatory authority (a
"Change in 1940 Act Law") to the effect that the Series A Issuer is or will be
considered an "investment company" that is required to be registered under the
Investment Company Act of 1940, as amended, which Change in 1940 Act Law
becomes effective on or after the date of original issuance of the Series A
Preferred Securities.
S-9
<PAGE>
"Like Amount" means (i) with respect to a redemption of the Series A
Preferred Securities and the Common Securities of the Series A Issuer
(together, the "Series A Trust Securities"), Series A Trust Securities having
an aggregate liquidation amount equal to the principal amount of Series A
Debentures to be contemporaneously redeemed in accordance with the Indenture
and the proceeds of which will be used to pay the Redemption Price of such
Series A Trust Securities and (ii) with respect to a distribution to holders
of Series A Trust Securities of Series A Debentures in connection with a
termination or liquidation of the Series A Issuer, Series A Debentures having
a principal amount equal to the aggregate liquidation amount of the Series A
Trust Securities in exchange for which such Series A Debentures are
distributed.
LIQUIDATION VALUE
The amount payable on the Series A Preferred Securities in the event of any
liquidation of the Series A Issuer is $25 per Series A Preferred Security plus
accumulated and unpaid Distributions, unless, in connection with such
liquidation, the Series A Debentures are distributed to the holders of the
Series A Preferred Securities.
CERTAIN TERMS OF THE SERIES A DEBENTURES
GENERAL
The following summary of certain terms and provisions of the Series A
Debentures supplements the description of the terms and provisions of the
Debentures set forth in the accompanying Prospectus under the heading
"Description of the Debentures," to which description reference is hereby
made. The summary of certain terms and provisions of the Series A Debentures
set forth below does not purport to be complete and is subject to, and
qualified in its entirety by reference to, the Indenture. The Indenture has
been filed as an exhibit to the Registration Statement of which this
Prospectus Supplement and accompanying Prospectus is a part.
Concurrently with the issuance of the Series A Preferred Securities, the
Series A Issuer will invest the proceeds thereof and the consideration paid by
PG&E for the Common Securities in the corresponding series of Series A
Debentures issued by PG&E to the Series A Issuer. The Series A Debentures will
bear Interest at the annual rate of % of the principal amount thereof,
payable quarterly in arrears on March 31, June 30, September 30 and December
31 of each year. Interest which is accrued and unpaid after the quarterly
payment date therefor will bear the additional interest on the amount thereof
(to the extent permitted by law) at the rate per annum of % thereof,
compounded quarterly. The term "Interest" as used herein shall include
quarterly interest payments, interest on quarterly interest payments in
arrears and Additional Interest (as defined below), as applicable. The Series
A Debentures' other Interest payment provisions correspond to the Distribution
provisions of the Series A Preferred Securities.
The Series A Debentures will be issued as a series of Debentures under the
Indenture. The Series A Debentures will mature on , 2025. The Series A
Debentures will be unsecured and will rank junior and be subordinate in right
of payment to all Senior Indebtedness of PG&E. See "Description of the
Debentures--Subordination" in the accompanying Prospectus.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
PG&E has the right at any time and from time to time, so long as an Event of
Default under the Indenture has not occurred and is continuing, to extend the
interest payment period for the Series A Debentures for up to 20 consecutive
quarters; provided that no Extension Period shall extend beyond the stated
maturity date or date of redemption of the Series A Debentures. At the end of
the Extension Period, PG&E is obligated to pay all interest then accrued and
unpaid (together with interest thereon
S-10
<PAGE>
to the extent permitted by applicable law). During any Extension Period, PG&E
will not, and will not permit any subsidiary of PG&E to, declare or pay any
dividend or distribution on, or redeem, purchase, acquire, or make a
liquidation or guarantee payment (other than payments under a Guarantee) with
respect to, any shares of PG&E's capital stock or any security of PG&E
(including other Debentures) ranking pari passu with or junior in interest to
the Debentures, except (i) in each case with securities junior in interest to
the Debentures or (ii) for payments made on any series of Debentures upon the
stated maturity of such Debentures. As a result, this covenant requires that
an interest payment on one series of Debentures may be extended only if the
interest periods on all series of Debentures are likewise extended. Prior to
the termination of any Extension Period, PG&E may further extend the interest
payment period, provided that such Extension Period, together with all such
previous and further extensions thereof, may not exceed 20 consecutive
quarters or extend beyond the maturity or redemption date of the Series A
Debentures. Upon the termination of any Extension Period and the payment of
all amounts then due, PG&E may select a new Extension Period subject to the
above requirements. So long as the Property Trustee shall be the sole holder
of the Series A Debentures, PG&E is required to give the Property Trustee and
the Debenture Trustee notice of its selection of such Extension Period one
Business Day prior to the date the Property Trustee or PG&E is required to
give notice to any national securities exchange on which any of the Series A
Preferred Securities are listed or other applicable self-regulatory
organization or to holders of the Series A Preferred Securities of the record
date, but in any event not less than one Business Day prior to such record
date. The Property Trustee will be required to give such notice of PG&E's
selection of such Extension Period to the holders of the Series A Preferred
Securities affected thereby.
ADDITIONAL INTEREST
If the Series A Issuer would be required to pay any taxes, duties,
assessments or other governmental charges of whatever nature (other than
withholding taxes) imposed by the United States, or any other taxing
authority, PG&E also will pay as additional interest on the Series A
Debentures ("Additional Interest") such amounts as shall be required so that
the net amounts received and retained by the Series A Issuer after paying any
such taxes, duties, assessments or governmental charges will be not less than
the amounts the Series A Issuer would have received had no such taxes, duties,
assessments or governmental charges been imposed.
REDEMPTION
The Series A Debentures are redeemable prior to maturity at the option of
PG&E (i) at any time on or after , 2000, in whole or in part, and (ii) if a
Special Event occurs and is continuing, in whole (but not in part), in any
case at a Redemption Price equal to 100% of the principal amount thereof plus
accrued Interest to the redemption date. The Series A Debentures will be
subject to optional redemption in whole (but not in part) upon the termination
and liquidation of the Series A Issuer pursuant to an order for the
dissolution, termination or liquidation of the Series A Issuer entered by a
court of competent jurisdiction. For so long as the Series A Trust is the
holder of all Series A Debentures outstanding, the proceeds of any redemption
described in this section shall be used by the Series A Trust to redeem the
Series A Preferred Securities in accordance with their terms. PG&E shall not
redeem the Series A Debentures in part unless all accrued and unpaid interest
(including any Additional Interest) has been paid in full on all Series A
Debentures outstanding for all quarterly interest periods on or prior to the
Redemption Date.
DISTRIBUTIONS OF SERIES A DEBENTURES
Under certain circumstances involving the termination of the Series A
Issuer, Series A Debentures may be distributed to the holders of the Series A
Preferred Securities in liquidation of the Series A Issuer after satisfaction
of liabilities to creditors of the Series A Issuer as provided by applicable
law. If
S-11
<PAGE>
distributed to holders of Series A Preferred Securities in liquidation, the
Series A Debentures will initially be issued in the form of one or more global
securities and The Depository Trust Company ("DTC"), or any successor
depositary for the Series A Preferred Securities, will act as depositary for
the Series A Debentures. It is anticipated that the depositary arrangements
for the Series A Debentures would be substantially identical to those in
effect for the Series A Preferred Securities. Neither PG&E, The First National
Bank of Chicago, as Debenture Trustee, any paying agent nor any other agent of
PG&E or the Debenture Trustee will have any responsibility or liability for
any aspect of the records relating to or payments made on account of
beneficial ownership interests in a global security for such Series A
Debentures or for maintaining, supervising or reviewing any records relating
to such beneficial ownership interests. For a description of DTC and the terms
of the depositary arrangements relating to payments, transfers, voting rights,
redemption and other notices and other matters, see "Description of the
Preferred Securities--Book-Entry-Only Issuance--The Depository Trust Company"
in the accompanying Prospectus.
A global security shall be exchangeable for Series A Debentures registered
in the names of persons other than DTC or its nominee only if (i) DTC notifies
PG&E that it is unwilling or unable to continue as a depository for such
global security and no successor depository shall have been appointed, or if
at any time DTC ceases to be a clearing agency registered under the Exchange
Act at a time when DTC is required to be so registered to act as such
depository, (ii) PG&E in its sole discretion determines that such global
security shall be so exchangeable, or (iii) there shall have occurred and be
continuing an Event of Default with respect to such global security. Any
global security that is exchangeable pursuant to the preceding sentence shall
be exchangeable for definitive certificates registered in such names as DTC
shall direct. It is expected that such instructions will be based upon
directions received by DTC from its Participants with respect to ownership of
beneficial interests in such global security. In the event that Series A
Debentures are issued in definitive form, such Series A Debentures will be in
denominations of $25 and integral multiples thereof and may be transferred or
exchanged at the offices described below.
Payments on Series A Debentures represented by a global security will be
made to DTC, as the depositary for the Series A Debentures. In the event
Series A Debentures are issued in definitive form, principal and interest will
be payable, the transfer of the Series A Debentures will be registrable, and
Series A Debentures will be exchangeable for Series A Debentures of other
denominations of a like aggregate principal amount, at the corporate office of
the Debenture Trustee in Chicago, Illinois, or at the offices of any paying
agent or transfer agent appointed by PG&E, provided that payment of interest
may be made at the option of PG&E by check mailed to the address of the
persons entitled thereto or by wire transfer. In addition, if the Series A
Debentures are issued in certificated form, the record dates for payment of
interest will be the 15th day preceding the end of each quarter. For a
description of DTC and the terms of the depositary arrangements relating to
payments, transfers, voting rights, redemptions and other notices and other
matters, see "Description of the Preferred Securities--Book-Entry-Only
Issuance--The Depository Trust Company" in the accompanying Prospectus.
If the Series A Debentures are distributed to the holders of Series A
Preferred Securities upon the liquidation of the Series A Issuer, PG&E will
use its best efforts to list the Series A Debentures on such stock exchanges,
if any, as the Series A Preferred Securities are then listed.
UNITED STATES TAXATION
GENERAL
This section is a summary of certain United States federal income tax
considerations that may be relevant to prospective purchasers of Series A
Preferred Securities and represents the opinion of Ballard Spahr Andrews &
Ingersoll, special tax counsel to PG&E and the Series A Issuer, insofar as it
S-12
<PAGE>
relates to matters of law and legal conclusions. This section is based upon
current provisions of the Internal Revenue Code of 1986, as amended (the
"Code"), existing and proposed regulations thereunder and current
administrative rulings and court decisions, all of which are subject to
change. Subsequent changes may cause tax consequences to vary substantially
from the consequences described below. Unless otherwise stated, this summary
deals only with Series A Preferred Securities held as capital assets and does
not deal with special classes of holders, such as dealers in securities or
currencies, life insurance companies, persons holding Series A Preferred
Securities as a hedge against or which are hedged against currency risks or as
a part of a straddle, or persons whose functional currency is not the United
States dollar.
POTENTIAL INVESTORS ARE ADVISED TO CONSULT THEIR TAX ADVISORS AS TO THE
UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF THE PURCHASE OF SERIES A
PREFERRED SECURITIES PURSUANT TO THE OFFER AND OF THE OWNERSHIP AND
DISPOSITION OF SERIES A PREFERRED SECURITIES IN LIGHT OF THEIR PARTICULAR
CIRCUMSTANCES, AS WELL AS THE EFFECT OF ANY STATE, LOCAL OR OTHER LAWS.
While PG&E believes, based upon the advice of its counsel, that the Series A
Debentures will be treated as indebtedness for United States federal income
tax purposes, holders of Series A Preferred Securities should note that the
Internal Revenue Service (the "IRS") may attempt to treat the Series A
Debentures as equity rather than indebtedness for tax purposes. If the IRS
were successful in such attempt, the Series A Debentures would be subject to
redemption at the option of PG&E as described under "Certain Terms of the
Series A Debentures--Redemption."
INCOME FROM SERIES A PREFERRED SECURITIES
In connection with the issuance of the Series A Debentures, Ballard Spahr
Andrews & Ingersoll will render its opinion to the effect that, under then
current law and assuming full compliance with the terms of the Trust
Agreement, the Series A Issuer will be classified as a grantor trust and not
as an association taxable as a corporation.
As a consequence, each holder of Series A Preferred Securities will be
considered the owner of a pro rata portion of the Series A Debentures held by
the Series A Issuer. As a further consequence, each holder of Series A
Preferred Securities will be required to include in gross income his or her
pro rata share of the income accrued on the Series A Debentures held by the
Series A Issuer. Such income should not exceed Distributions received by the
holders of Series A Preferred Securities on the Series A Preferred Securities
except in limited circumstances described under "Certain Terms of the Series A
Preferred Securities--Distributions." No portion of such income will be
eligible for the dividends received deduction.
POTENTIAL EXTENSION OF INTEREST PAYMENT PERIOD AND ORIGINAL ISSUE DISCOUNT
Under the Indenture, PG&E has the option to extend from time to time the
interest payment period on the Series A Debentures to a period not exceeding
20 consecutive quarters but not beyond the maturity date of the Series A
Debentures. PG&E's option to extend the interest payment period will cause the
Series A Debentures to be treated as issued with "original issue discount" for
United States federal income tax purposes. Accordingly, a holder of Series A
Preferred Securities will accrue interest income (i.e., original issue
discount) under a constant yield basis over the term of the Series A
Debentures (including any Extension Period), regardless of the receipt of cash
with respect to the period to which such income is attributable.
As a result, holders of Series A Preferred Securities during an Extension
Period will include interest in gross income in advance of the receipts of
cash, and any holders of Series A Preferred Securities who dispose of Series A
Preferred Securities prior to the record date for the payment of Distributions
following such extension period will include interest in gross income, but
will not receive any cash related thereto. The tax basis of a Series A
Preferred Security will be increased by the amount of any
S-13
<PAGE>
original issue discount that is included in income without a receipt of cash,
and will be decreased when and if such cash is subsequently received by the
holder of the Series A Preferred Security.
DISPOSITION OF THE SERIES A PREFERRED SECURITIES
Gain or loss will be recognized on a sale, including a redemption for cash,
of Series A Preferred Securities in an amount equal to the difference between
the amount realized and the tax basis of a holder of Series A Preferred
Securities in his or her pro rata share of Series A Debentures represented by
such Series A Preferred Securities. Gain or loss recognized by a holder of
Series A Preferred Securities on the sale or exchange of Series A Preferred
Securities held for more than one year generally will be taxable as long-term
capital gain or loss.
UNITED STATES ALIEN HOLDERS
For purposes of this discussion, a "United States Alien Holder" is any
holder or beneficial owner who or which is (i) a nonresident alien individual
or (ii) a foreign corporation, partnership, estate or trust, in either case
not subject to United States federal income tax on a net income basis in
respect of a Series A Preferred Security.
Under present United States federal income tax law, subject to the
discussion below with respect to backup withholding:
(i) Payments by the Series A Issuer or any of its paying agents to any
United States Alien Holder will not be subject to United States withholding
tax provided that (a) the beneficial owner of the Series A Preferred
Security does not actually or constructively own 10% or more of the total
combined voting power of all classes of stock of PG&E, (b) the beneficial
owner of the Series A Preferred Securities is not a controlled foreign
corporation that is related to PG&E through stock ownership, and (c) either
(1) the beneficial owner of the Series A Preferred Securities certifies to
the Issuer or its agent, under penalties of perjury, that it is a United
States Alien Holder and provides its name and address or (2) the holder of
the Series A Preferred Securities is a securities clearing organization,
bank or other financial institution that holds customers' securities in the
ordinary course of its trade or business (a "financial institution"), and
such holder certifies to the Series A Issuer or its agent under penalties
of perjury that such statement has been received from the beneficial owner
by it or by a financial institution between it and the beneficial owner and
furnishes the payor with a copy thereof; and
(ii) a United States Alien Holder of a Series A Preferred Security will
not be subject to United States federal income or withholding tax on any
gain realized on the sale or exchange of a Series A Preferred Security
unless such person is present in the United States for 183 days or more in
the taxable year of sale and such person has a "tax home" in the United
States or certain other requirements are met.
BACKUP WITHHOLDING AND INFORMATION REPORTING
In general, information reporting requirements will apply to payments to
noncorporate United States holders of the proceeds of the sale of the Series A
Preferred Securities within the United States and "backup withholding" at a
rate of 31% will apply to such payments if the seller fails to provide a
correct taxpayer identification number.
Payments of the proceeds from the sale by a United States Alien Holder of
Series A Preferred Securities made to or through a foreign office of a broker
will not be subject to information reporting or backup withholding, except
that, if the broker is a United States person, a controlled foreign
corporation for United States tax purposes or a foreign person 50% or more of
whose gross income is effectively connected with a United States trade or
business for a specified three-year period, information reporting may apply to
such payment. Payments of the proceeds from the sale of Series A Preferred
Securities to or through the United States office of a broker is subject to
information reporting and
S-14
<PAGE>
backup withholding unless the holder or beneficial owner certifies as to its
non-United States status or otherwise establishes an exemption from
information reporting and backup withholding.
RECEIPT OF SERIES A DEBENTURES UPON LIQUIDATION OF THE SERIES A ISSUER
Under certain circumstances described in "Certain Terms of the Series A
Preferred Securities--Redemption," PG&E may cause the Series A Issuer to be
terminated and cause the Series A Debentures to be distributed to the holders
of Series A Preferred Securities in liquidation of such holders' interests in
the Series A Issuer. Under current United States federal income tax law and
interpretation and assuming the Series A Trust is treated as a grantor trust,
such a distribution should not be treated as a taxable event to holders of the
Series A Preferred Securities. Such a tax-free transaction would result in the
holder of Series A Preferred Securities receiving an aggregate tax basis in
the Series A Debentures equal to such holder's aggregate tax basis in the
holder's Series A Preferred Securities. A holder's holding period for such
Series A Debentures would include the period for which the Series A Preferred
Securities were held by such holder.
POTENTIAL EXTENSION OF INTEREST PAYMENT PERIOD
In the event that the interest payment period on the Series A Debentures is
extended (as provided under "Certain Terms of the Series A Preferred
Securities--Distributions"), the Series A Issuer will continue to accrue
income, generally equal to the amount of the interest payment due at the end
of the Extension Period, over the length of the extended interest payment
period.
UNDERWRITING
Subject to the terms and conditions of the Underwriting Agreement, PG&E and
the Series A Issuer have agreed that the Series A Issuer will sell to each of
the Underwriters named below, for whom and are acting as
Representatives, and each of the Underwriters has severally agreed to purchase
from the Series A Issuer the respective number of Series A Preferred
Securities set forth opposite its name below:
<TABLE>
<CAPTION>
NUMBER OF SERIES A
UNDERWRITER PREFERRED SECURITIES
----------- --------------------
<S> <C>
---
Total............................................
===
</TABLE>
Under the terms and conditions of the Underwriting Agreement, the
Underwriters are committed to take and pay for all such Series A Preferred
Securities offered hereby, if any are taken.
The Underwriters propose to offer the Series A Preferred Securities in part
directly to the public at the initial public offering price set forth on the
cover page of this Prospectus Supplement, and in part
S-15
<PAGE>
to certain securities dealers at such price less a concession of $ per
Series A Preferred Security. The Underwriters may allow, and such dealers may
reallow, a concession not in excess of $ per Series A Preferred Security to
certain brokers and dealers. After the Series A Preferred Securities are
released for sale to the public, the offering price and other selling terms
may from time to time be varied by the Representatives.
In view of the fact that the proceeds from the sale of the Series A
Preferred Securities will be used to purchase the Series A Debentures issued
by PG&E, the Underwriting Agreement provides that PG&E will pay as
Underwriters' Compensation for the Underwriters arranging the investment
therein of such proceeds an amount of $ per Series A Preferred Security for
the accounts of the several Underwriters.
The Series A Issuer has granted the Underwriters an option exercisable for
30 days after that date of this Prospectus Supplement to purchase up to
additional Series A Preferred Securities to cover over-allotments, if any, at
the initial public offering price (with additional Underwriters'
Compensation), as set forth on the cover page of this Prospectus Supplement.
If the Underwriters exercise their over-allotment option, the Underwriters
have severally agreed, subject to certain conditions, to purchase
approximately the same percentage thereof that the number of Series A
Preferred Securities to be purchased by each of them, as shown in the
foregoing table, bears to the number of Series A Preferred Securities offered
hereby.
PG&E and the Series A Issuer have agreed, during the period beginning from
the date of the Underwriting Agreement and continuing to and including the
earlier of (i) the date on which the distribution of the Series A Preferred
Securities ceases, as determined by the Underwriters, or (ii) 30 days after
the closing date, not to offer, sell, contract to sell or otherwise dispose of
any Preferred Securities, any other interests of the Issuers, or any preferred
stock or any other securities of the Issuers or PG&E which are substantially
similar to the Preferred Securities, including a Guarantee, or any securities
convertible into or exchangeable for Preferred Securities, preferred stock or
such substantially similar securities of either an Issuer or PG&E, without the
prior written consent of the Representatives.
Prior to this offering, there has been no public offering or market for the
Series A Preferred Securities. Application has been made to list the Series A
Preferred Securities on the Exchange, subject to official notice of
issuance, under the symbol " ". In order to meet one of the requirements for
listing the Series A Preferred Securities on the Exchange, the
Underwriters will undertake to sell lots of 100 or more Series A Preferred
Securities to a minimum of 400 beneficial holders. If approved for listing,
trading of the Series A Preferred Securities on the Exchange is expected
to commence within a seven-day period after the initial delivery of the Series
A Preferred Securities. The Representatives have advised PG&E that they intend
to make a market in the Series A Preferred Securities prior to the
commencement of trading on the Exchange, but are not obligated to do so
and may discontinue any such market making at any time without notice.
PG&E and the Series A Issuer have agreed to indemnify the several
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933.
S-16
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+ REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+ SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+ OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+ BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+ THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+ SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+ UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED , 1995
PG&E CAPITAL I
PG&E CAPITAL II
PG&E CAPITAL III
PG&E CAPITAL IV
CUMULATIVE QUARTERLY INCOME PREFERRED SECURITIES (QUIPS /SM/)*
GUARANTEED TO THE EXTENT SUCH ISSUER HAS FUNDS AS SET FORTH HEREIN BY
PACIFIC GAS AND ELECTRIC COMPANY
----------
PG&E Capital I, PG&E Capital II, PG&E Capital III and PG&E Capital IV, each a
statutory business trust formed under the laws of the State of Delaware (each,
the "Issuer," and collectively, the "Issuers") may severally offer, from time
to time, their respective cumulative quarterly income preferred securities (the
"Preferred Securities") representing preferred undivided beneficial interests
in the assets of each Issuer. Pacific Gas and Electric Company, a California
corporation ("PG&E"), will be the owner of beneficial interests represented by
common securities (the "Common Securities") of each Issuer. The First National
Bank of Chicago is the Property Trustee of each Issuer. The payment of periodic
cash distributions ("Distributions") with respect to the Preferred Securities
of each Issuer and payments on liquidation or redemption with respect to such
Preferred Securities, in each case out of funds held by such Issuer, are each
guaranteed by PG&E to the extent described herein (each, a "Guarantee"). The
obligations of PG&E under each Guarantee will be subordinate and junior in
right of payment to all liabilities of PG&E except any liabilities that may be
made pari passu or subordinate to the Guarantee expressly by their terms.
Concurrently with the issuance by each Issuer of its Preferred Securities, such
Issuer will invest the proceeds thereof in a corresponding series of PG&E's
deferrable interest subordinated debentures (the "Debentures") with terms
corresponding to that Issuer's Preferred Securities. The Debentures will be
unsecured and subordinate and junior in right of payment to Senior Indebtedness
(as defined herein) of PG&E. The Debentures will be the sole assets of each
Issuer and the interest on the Debentures will be the only revenue of each
Issuer. Upon the occurrence of certain events as may be described in the
accompanying Prospectus Supplement, PG&E may redeem the Debentures or may
terminate each Issuer and cause the Debentures to be distributed to the holders
of the Preferred Securities in liquidation of their interest in such Issuer.
See "Description of the Preferred Securities--Liquidation Distribution Upon
Termination".
The Preferred Securities may be offered in amounts, at prices and on terms to
be determined at the time of offering, provided, however, that the aggregate
initial public offering price of all Preferred Securities issued pursuant to
the Registration Statement of which this Prospectus forms a part shall not
exceed $335,000,000. Certain specific terms of a particular Issuer's Preferred
Securities in respect of which this Prospectus is being delivered will be set
forth in an accompanying Prospectus Supplement, including where applicable and
to the extent not set forth herein, the identity of that Issuer, the specific
title, the aggregate amount, the Distribution rate (or the method for
determining such rate), the stated liquidation preference, redemption
provisions, other rights, the initial public offering price, and any other
special terms, as well as any planned listing on a securities exchange, of such
Preferred Securities.
The Preferred Securities may be sold in a public offering to or through
underwriters or dealers designated from time to time. See "Plan of
Distribution". The names of any such underwriters or dealers involved in the
sale of the Preferred Securities of any particular Issuer in respect of which
this Prospectus is being delivered, the number of Preferred Securities to be
purchased by any such underwriters or dealers and any applicable commissions or
discounts will be set forth in the Prospectus Supplement. The net proceeds to
each Issuer will also be set forth in the Prospectus Supplement.
The Prospectus Supplement will also contain information concerning United
States federal income tax considerations applicable to the Preferred Securities
offered thereby.
----------
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.
----------
*QUIPS is a service mark of Goldman, Sachs & Co.
The date of this Prospectus is , 1995.
<PAGE>
AVAILABLE INFORMATION
Pacific Gas and Electric Company, a California corporation ("PG&E") is
subject to the informational requirements of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and, in accordance therewith, files
reports, proxy statements and other information with the Securities and
Exchange Commission (the "Commission"). Such reports, proxy statements and
other information can be inspected and copied at the public reference room of
the Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C., and the
public reference facilities in the Commission's Regional Offices located at
Seven World Trade Center, 7th Floor, New York, New York and Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, Illinois. Copies of such
material can be obtained at prescribed rates by writing to the Securities and
Exchange Commission, Public Reference Section, Washington, D.C. 20549. Such
material can also be inspected at the New York, American and Pacific Stock
Exchanges.
PG&E and each of PG&E Capital I, PG&E Capital II, PG&E Capital III and PG&E
Capital IV, each a statutory business trust formed under the laws of the State
of Delaware, have filed with the Commission a Registration Statement on Form
S-3 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Act"). This Prospectus does not contain all of the information set forth in
the Registration Statement as certain parts are omitted in accordance with the
rules and regulations of the Commission. For further information, reference is
hereby made to the Registration Statement.
No separate financial statements of any Issuer have been included herein.
PG&E and the Issuers do not consider that such financial statements would be
material to holders of Preferred Securities offered hereby because each Issuer
is a newly formed special purpose entity, has no operating history or
independent operations and is not engaged in, and does not propose to engage
in, any activity other than as set forth below. See "The Issuers."
----------------
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by PG&E with the Commission are incorporated
by reference in this Prospectus:
1. PG&E's annual report on Form 10-K for the year ended December 31,
1994.
2. PG&E's quarterly reports on Form 10-Q for the quarters ended March 31,
1995 and June 30, 1995.
3. PG&E's current reports on Form 8-K dated January 4, 1995, January 19,
1995, February 21, 1995, March 2, 1995, April 20, 1995, May 17, 1995, May
23, 1995, May 26, 1995, July 14, 1995, July 20, 1995 and August 17, 1995.
All other documents filed by PG&E pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and the
accompanying Prospectus Supplement and prior to the termination of the
offering of the Preferred Securities shall be deemed to be incorporated by
reference in this Prospectus and the accompanying Prospectus Supplement, and
to be a part hereof from the respective dates of the filing of such documents.
Any statement contained herein or in a document all or a portion of which is
incorporated or deemed to be incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this Prospectus and the
accompanying Prospectus Supplement 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 or the
accompanying Prospectus Supplement.
2
<PAGE>
PG&E hereby undertakes to provide without charge to each person, including
any beneficial owner, to whom a copy of this Prospectus has been delivered, on
the written or oral request of any such person, a copy of any or all the
documents referred to above which have been or may be incorporated in this
Prospectus by reference, other than exhibits to such documents which are not
specifically incorporated by reference in the information that this Prospectus
incorporates. Requests should be directed to Leslie Guliasi, Transfer Agent,
Shareholder Services, Pacific Gas and Electric Company, 77 Beale Street, Room
2600, P.O. Box 770000, San Francisco, California 94177 (Telephone: 1-800-367-
7731).
THE ISSUERS
Each of PG&E Capital I, PG&E Capital II, PG&E Capital III and PG&E Capital
IV is a statutory business trust formed under Delaware law pursuant to (i) a
trust agreement executed by PG&E, as sponsor for the Issuer, and the Issuer
Trustees (as defined herein) of such Issuer and (ii) the filing of a
certificate of trust with the Delaware Secretary of State. Each trust
agreement will be amended and restated in its entirety (each, as so amended
and restated, the "Trust Agreement") substantially in the form filed as an
exhibit to the Registration Statement of which this Prospectus forms a part.
Each Trust Agreement will be qualified as an indenture under the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"). Each Issuer
exists for the exclusive purposes of (i) issuing and selling its Preferred
Securities and Common Securities, (ii) using the proceeds from the sale of
such Preferred Securities and Common Securities to acquire a corresponding
series of Debentures issued by PG&E and (iii) engaging in those activities
necessary, convenient or incidental thereto. All of the Common Securities will
be owned by PG&E. The Common Securities will rank pari passu, and payments
will be made thereon pro rata, with the Preferred Securities, except that upon
the occurrence and continuance of a Debenture Event of Default (as defined
herein) under the Trust Agreement, the rights of the holders of the Common
Securities to payment in respect of Distributions and payments upon
liquidation, redemption or other acquisition of Common Securities will be
subordinated to the rights of the holders of the Preferred Securities. PG&E
will acquire Common Securities in an aggregate liquidation amount equal to 3%
of the total capital of each Issuer. Each Issuer has a term of approximately
36 years, but may terminate earlier as provided in the applicable Trust
Agreement. Each Issuer's business and affairs is conducted by its trustees,
each appointed by PG&E as holder of the Common Securities: The First National
Bank of Chicago (the "Property Trustee"), a Delaware Trustee and three
individual trustees (the "Administrative Trustees") who are employees or
officers of or affiliated with PG&E (collectively, the "Issuer Trustees"). The
holder of the Common Securities, or the holders of a majority in liquidation
preference of the Preferred Securities if a Debenture Event of Default has
occurred and is continuing, will be entitled to appoint, remove or replace the
Property Trustee and the Delaware Trustee. In no event will the holders of the
Series A Preferred Securities have the right to vote to appoint, remove or
replace the Administrative Trustees, which voting rights are vested
exclusively in the holder of the Common Securities. The duties and obligations
of each of the Issuer Trustees are governed by the applicable Trust Agreement.
PG&E will pay all fees and expenses related to the Issuers and the offering of
the Preferred Securities and will pay, directly or indirectly, all ongoing
costs, expenses and liabilities of the Issuers. The principal place of
business of each Issuer is c/o Pacific Gas and Electric Company, 77 Beale
Street, P. O. Box 770000, San Francisco, California 94177, and its telephone
number is (415) 973-7000.
PACIFIC GAS AND ELECTRIC COMPANY
Pacific Gas and Electric Company is an operating public utility engaged
principally in the business of supplying electric and natural gas service
throughout most of northern and central California. PG&E was incorporated in
California in 1905. Its principal executive office is located at 77 Beale
Street, P.O. Box 770000, San Francisco, California 94177, and its telephone
number is (415) 973-7000.
3
<PAGE>
DESCRIPTION OF THE PREFERRED SECURITIES
Pursuant to the terms of each Trust Agreement, the Issuer Trustees will
issue the Preferred Securities and the Common Securities (together, the "Trust
Securities"). The Preferred Securities of a particular issue will represent
preferred undivided beneficial interests in the assets of the related Issuer
and the holders thereof will be entitled to a preference in certain
circumstances with respect to Distributions and amounts payable on redemption
or liquidation over the Common Securities of such Issuer, as well as other
benefits as described in the corresponding Trust Agreement. This summary of
certain provisions of each Trust Agreement does not purport to be complete and
is subject to, and is qualified in its entirety by reference to, all the
provisions of each Trust Agreement, including the definitions therein of
certain terms, and the Trust Indenture Act. The form of the Trust Agreement
has been filed as an exhibit to the Registration Statement of which this
Prospectus forms a part. Each of the Issuers is a legally separate entity and
the assets of one are not available to satisfy the obligations of any of the
others.
GENERAL
The Preferred Securities of an Issuer will rank pari passu, and payments
will be made thereon pro rata, with the Common Securities of that Issuer
except as described under "--Subordination of Common Securities." The
Debentures will be owned by the Property Trustee and will be held in trust for
the benefit of the holders of the related Trust Securities. Each Guarantee
Agreement executed by PG&E for the benefit of the holders of each Issuer's
Preferred Securities (each, the "Guarantee") is a full and unconditional
guarantee on a subordinated basis with respect to the related Preferred
Securities but does not guarantee payment of Distributions or amounts payable
on redemption or liquidation of such Preferred Securities when the related
Issuer does not have funds on hand available to make such payments. See
"Description of the Guarantee."
DISTRIBUTIONS
Each Issuer's Preferred Securities represent undivided beneficial interests
in the assets of such Issuer, and as a practical matter the Distributions on
each Preferred Security will be payable at a rate specified in the Prospectus
Supplement for such Preferred Securities. The amount of Distributions payable
for any period will be computed on the basis of a 360-day year of twelve 30-
day months.
Distributions on the Preferred Securities will be cumulative, will accrue
from the date of original issuance and will be payable quarterly in arrears,
on March 31, June 30, September 30 and December 31 of each year (except as
otherwise described below). In the event that any date on which Distributions
are otherwise payable on the Preferred Securities is not a Business Day,
payment of the Distribution payable on such date will be made on the next
succeeding day that is a Business Day (and without any interest or other
payment in respect to any such delay) except that, if such Business Day is in
the next succeeding calendar year, payment of such Distribution shall be made
on the immediately preceding Business Day, in each case with the same force
and effect as if made on such date (each date on which Distributions are
otherwise payable in accordance with the foregoing, a "Distribution Date"). A
"Business Day" shall mean any day other than a Saturday or a Sunday or a day
on which banking institutions in The City of New York are authorized or
required by law or executive order to remain closed or a day on which the
corporate trust office of the Property Trustee is closed for business.
PG&E has the right under the Indenture to extend the interest payment period
from time to time on each series of the Debentures, with the consequence that
quarterly Distributions on the corresponding Preferred Securities would be
deferred.
It is anticipated that the income of each Issuer available for distribution
to its holders of Preferred Securities will be limited to payments under the
corresponding series of Debentures in which the Issuer
4
<PAGE>
will invest the proceeds from the issuance and sale of its Preferred
Securities and its Common Securities. See "Description of the Debentures." If
PG&E does not make interest payments on such Debentures, the Property Trustee
will not have funds available to pay Distributions on the corresponding
Preferred Securities.
Distributions on the Preferred Securities will be payable to the holders
thereof as they appear on the register of such Issuer on the relevant record
dates, which, as long as the Preferred Securities remain in book-entry-only
form, will be one Business Day prior to the relevant Distribution Date.
Subject to any applicable laws and regulations and the provisions of the
applicable Trust Agreement, each such payment will be made as described under
"--Book-Entry-Only Issuance--The Depository Trust Company." In the event any
Preferred Securities are not in book-entry-only form, the relevant record date
for such Preferred Securities shall be the date 15 days prior to the relevant
Distribution Date.
REDEMPTION
Upon the repayment of any series of Debentures, whether at maturity or upon
earlier redemption as provided in the Indenture, the proceeds from such
repayment will be applied by the Property Trustee to redeem the corresponding
Trust Securities, upon not less than 30 nor more than 60 days' notice, at the
redemption price (the "Redemption Price") including all accrued and unpaid
Distributions to the redemption date (the "Redemption Date"). The redemption
terms of a particular series of Debentures and the related Preferred
Securities will be set forth in the accompanying Prospectus Supplement.
REDEMPTION PROCEDURES
Preferred Securities redeemed on each Redemption Date shall be redeemed at
the Redemption Price with the proceeds from the contemporaneous redemption of
the corresponding series of Debentures. Redemptions of the Preferred
Securities shall be made and the Redemption Price shall be payable on each
Redemption Date only to the extent that the Issuer has funds on hand available
for the payment of such Redemption Price. See also "--Subordination of Common
Securities."
If an Issuer gives a notice of redemption in respect of its Preferred
Securities, then, by 12:00 noon, New York City time, on the Redemption Date,
to the extent funds are available, the Property Trustee will deposit
irrevocably with The Depository Trust Company ("DTC") funds sufficient to pay
the applicable Redemption Price and will give DTC irrevocable instructions and
authority to pay the Redemption Price to the holders of such Preferred
Securities. See "--Book Entry-Only Issuance--The Depository Trust Company." If
such Preferred Securities are no longer in book-entry-only form, the Issuer,
to the extent funds are available, will irrevocably deposit with the paying
agent for such Preferred Securities funds sufficient to pay the applicable
Redemption Price and will give such paying agent irrevocable instructions and
authority to pay the Redemption Price to the holders thereof upon surrender of
their certificates evidencing such Preferred Securities. Notwithstanding the
foregoing, Distributions payable on or prior to the Redemption Date for any
Preferred Securities called for redemption shall be payable to the holders of
such Preferred Securities on the relevant record dates for the related
Distribution Dates. If notice of redemption shall have been given and funds
deposited as required, then upon the date of such deposit, all rights of the
holders of such Preferred Securities so called for redemption will cease,
except the right of the holders of such Preferred Securities to receive the
Redemption Price, but without interest on such Redemption Price, and such
Preferred Securities will cease to be outstanding. In the event that any date
fixed for redemption of Preferred Securities is not a Business Day, then
payment of the Redemption Price payable on such date will be made on the next
succeeding day which is a Business Day (and without any interest or other
payment in respect of any such delay), except that, if such Business Day falls
in the next calendar year, such
5
<PAGE>
payment will be made on the immediately preceding Business Day. In the event
that payment of the Redemption Price in respect of Preferred Securities called
for redemption is improperly withheld or refused and not paid either by the
Issuer or by PG&E pursuant to the Guarantee as described under "Description of
the Guarantee," Distributions on such Preferred Securities will continue to
accrue at the then applicable rate, from the original Redemption Date to the
date of payment, in which case the actual payment date will be considered the
date fixed for redemption for purposes of calculating the Redemption Price.
Subject to applicable law, PG&E or its subsidiaries may at any time and from
time to time purchase outstanding Preferred Securities by tender, in the open
market or by private agreement.
Payment of the Redemption Price on the Preferred Securities and any
distribution of Debentures to holders of Preferred Securities shall be made to
the applicable recordholders thereof as they appear on the register for such
Preferred Securities on the relevant record date, which shall be one Business
Day prior to the relevant Redemption Date or liquidation date, as applicable;
provided, however, that in the event that any Preferred Securities are not in
book-entry-only form, the relevant record date for such Preferred Securities
shall be the date 15 days prior to the Redemption Date or liquidation date, as
applicable.
If less than all the securities issued by an Issuer are to be redeemed on a
Redemption Date, then the aggregate liquidation preference of such securities
to be redeemed shall be allocated 3% to its Common Securities and 97% to its
Preferred Securities. The particular Preferred Securities to be redeemed shall
be selected not more than 60 days prior to the Redemption Date by the Property
Trustee from the outstanding Preferred Securities not previously called for
redemption, by such method as the Property Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $25 or integral multiples thereof) of the liquidation preference of
Preferred Securities of a denomination larger than $25. The Property Trustee
shall promptly notify the security registrar in writing of the Preferred
Securities selected for redemption and, in the case of any Preferred
Securities selected for partial redemption, the liquidation preference thereof
to be redeemed. For all purposes of each Trust Agreement, unless the context
otherwise requires, all provisions relating to the redemption of Preferred
Securities shall relate, in the case of any Preferred Securities redeemed or
to be redeemed only in part, to the portion of the aggregate liquidation
preference of Preferred Securities which has been or is to be redeemed.
SUBORDINATION OF COMMON SECURITIES
Payment of Distributions on, and the Redemption Price of, each Issuer's
Trust Securities, as applicable, shall be made pro rata based on the
liquidation preference of such Trust Securities; provided, however, that if on
any Distribution Date or Redemption Date a Debenture Event of Default (as
defined below, see "--Events of Default; Notice") under the applicable Trust
Agreement shall have occurred and be continuing, no payment of any
Distribution on, or Redemption Price of, any of the Issuer's Common
Securities, and no other payment on account of the redemption, liquidation or
other acquisition of such Common Securities, shall be made unless payment in
full in cash of all accumulated and unpaid Distributions on all of the
Issuer's outstanding Preferred Securities for all Distribution periods
terminating on or prior thereto, or in the case of payment of the Redemption
Price the full amount of such Redemption Price on all of the Issuer's
outstanding Preferred Securities, shall have been made or provided for, and
all funds available to the Property Trustee shall first be applied to the
payment in full in cash of all Distributions on, or Redemption Price of, the
Issuer's Preferred Securities then due and payable.
In the case of any Event of Default under any Trust Agreement resulting from
an event of default under the Indenture (a "Debenture Event of Default"), the
holder of such Issuer's Common Securities will be deemed to have waived any
right to act with respect to such Event of Default under such Trust
6
<PAGE>
Agreement until the effect of all such Events of Default with respect to such
Preferred Securities have been cured, waived or otherwise eliminated. Until
any such Events of Default under the applicable Trust Agreement with respect
to the Preferred Securities have been so cured, waived or otherwise
eliminated, the Property Trustee shall act solely on behalf of the holders of
such Preferred Securities and not on behalf of the holder of the Issuer's
Common Securities, and only the holders of such Preferred Securities will have
the right to direct the Property Trustee to act on their behalf.
LIQUIDATION DISTRIBUTION UPON TERMINATION
Pursuant to each Trust Agreement, each Issuer shall be terminated by PG&E on
the first to occur of: (i) December 31, 2031, the expiration of the term of
such Issuer; (ii) the bankruptcy, dissolution or liquidation of PG&E; (iii)
the distribution of a Like Amount of the corresponding series of Debentures to
the holders of its Preferred Securities and Common Securities following the
occurrence of a Special Event or in the event the Issuer is not or will not be
taxed as a grantor trust but a Tax Event has not occurred; (iv) the redemption
of all of the Issuer's Preferred Securities; and (v) an order for the
termination of the Issuer shall have been entered by a court of competent
jurisdiction.
If an early termination occurs as described in clause (ii), (iii) or (v)
above, the Issuer shall be liquidated by the Issuer Trustees as expeditiously
as the Issuer Trustees determine to be possible by distributing, after
satisfaction of liabilities to creditors of such Issuer as provided by
applicable law, to the holders of such Preferred Securities and Common
Securities a Like Amount of the corresponding series of Debentures, unless
such distribution is determined by the Property Trustee not to be practical,
in which event such holders will be entitled to receive out of the assets of
the Issuer available for distribution to holders, after satisfaction of
liabilities to creditors of such Issuer as provided by applicable law, an
amount equal to, in the case of holders of Preferred Securities, the aggregate
of the stated liquidation preference of $25 per Preferred Security plus
accrued and unpaid Distributions thereon to the date of payment (such amount
being the "Liquidation Distribution"). If such Liquidation Distribution can be
paid only in part because such Issuer has insufficient assets available to pay
in full the aggregate Liquidation Distribution, then the amounts payable
directly by such Issuer on its Preferred Securities shall be paid on a pro
rata basis. The holder(s) of such Issuer's Common Securities will be entitled
to receive distributions upon any such liquidation pro rata with the holders
of its Preferred Securities, except that if a Debenture Event of Default has
occurred and is continuing, the Preferred Securities shall have a priority
over the Common Securities. A supplemental Indenture may provide that if an
early termination occurs as described in clause (v) above, the related series
of Debentures may be subject to optional redemption in whole (but not in
part).
EVENTS OF DEFAULT; NOTICE
Any one of the following events constitutes an "Event of Default" under each
Trust Agreement with respect to the Preferred Securities issued thereunder
(whatever the reason for such Event of Default and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment, decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(i) the occurrence of an "Event of Default" as defined the Indenture (see
"Description of the Debentures--Events of Default"); or
(ii) default by the Property Trustee in the payment of any Distribution
when it becomes due and payable, and continuation of such default for a
period of 30 days; or
(iii) default by the Property Trustee in the payment of any Redemption
Price of any Preferred Security or Common Security when it becomes due and
payable; or
(iv) default in the performance, or breach, in any material respect, of
any covenant or warranty of the Issuer Trustees in such Trust Agreement
(other than a covenant or warranty a default in the performance of which or
the breach of which is dealt with in clause (ii) or (iii) above), and
continuation of such default or breach for a period of 60 days after there
has been given, by registered or certified mail, to the defaulting Issuer
Trustee or Trustees by the holders of at least 10% in aggregate liquidation
preference of the outstanding Preferred Securities of the applicable
7
<PAGE>
Issuer, a written notice specifying such default or breach and requiring it
to be remedied and stating that such notice is a "Notice of Default" under
such Trust Agreement; or
(v) the occurrence of certain events of bankruptcy or insolvency with
respect to the Property Trustee and the failure by PG&E to appoint a
successor Property Trustee within 60 days thereof.
Within five Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit
notice of such Event of Default to the holders of such Issuer's Preferred
Securities, the Administrative Trustees and PG&E, as Depositor, unless such
default shall have been cured or waived. PG&E, as Depositor, and the
Administrative Trustees are required to file annually with the Property
Trustee a certificate as to whether or not they are in compliance with all the
conditions and covenants applicable to them under the Trust Agreement.
If a Debenture Event of Default has occurred and is continuing, the
Preferred Securities shall have a preference over the Common Securities upon
termination of each Issuer as described above. See "--Liquidation Distribution
Upon Termination."
REMOVAL OF ISSUER TRUSTEES
Unless an Event of Default shall have occurred and be continuing, any Issuer
Trustee may be removed at any time by the holder of the Common Securities. If
a Debenture Event of Default has occurred and is continuing, the Property
Trustee and the Delaware Trustee may be removed at such time by the holders of
a majority in liquidation preference of the outstanding Preferred Securities.
In no event will the holders of the Preferred Securities have the right to
vote to appoint, remove or replace the Administrative Trustees, which voting
rights are vested exclusively in the holder of the Common Securities. No
resignation or removal of an Issuer Trustee and no appointment of a successor
trustee shall be effective until the acceptance of appointment by the
successor trustee in accordance with the provisions of the Trust Agreement.
CO-TRUSTEES AND SEPARATE PROPERTY TRUSTEE
Unless an Event of Default under a Trust Agreement shall have occurred and
be continuing, at any time or times, for the purpose of meeting the legal
requirements of the Trust Indenture Act or of any jurisdiction in which any
part of the Trust Property (as defined in each Trust Agreement) may at the
time be located, the holder of the applicable Common Securities and the
Administrative Trustees shall have power to appoint one or more persons either
to act as co-trustee, jointly with the Property Trustee, of all or any part of
such Trust Property, or to act as separate trustee of any such property, in
either case with such powers as may be provided in the instrument of
appointment, and to vest in such person or persons in such capacity any
property, title, right or power deemed necessary or desirable, subject to the
provisions of the Trust Agreement. In case a Debenture Event of Default under
the Indenture has occurred and is continuing, the Property Trustee alone shall
have power to make such appointment.
MERGER OR CONSOLIDATION OF ISSUER TRUSTEES
Any corporation into which the Property Trustee, the Delaware Trustee or any
Administrative Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which such Trustee shall be a party, or any corporation
succeeding to all or substantially all the corporate trust business of such
Trustee, shall be the successor of such Trustee under the Trust Agreements,
provided such corporation shall be otherwise qualified and eligible.
VOTING RIGHTS; AMENDMENT OF TRUST AGREEMENT
Except as provided below and under "Description of the Guarantee--Amendments
and Assignment" and as otherwise required by law and each Trust Agreement, the
holders of the Preferred Securities will have no voting rights.
8
<PAGE>
A Trust Agreement may be amended from time to time by the Depositor and the
Issuer Trustees, without the consent of the holders of the Preferred
Securities, (i) to cure ambiguities or (ii) to ensure that the Issuer will be
classified for federal income tax purposes as a grantor trust, provided that
any such amendment shall not adversely affect in any material respect the
interests of any holder of Preferred Securities. A Trust Agreement may be
amended by the Depositor and the Issuer Trustees in any other respect (except
to change the amount or timing of any Distribution) with the consent of the
holders of a majority in liquidation preference of Preferred Securities and
upon receipt of an opinion of counsel to the effect that such amendment will
not affect the Issuer's status as a grantor trust for federal income tax
purposes or its exemption from regulation as an investment company under the
Investment Company Act of 1940, as amended.
So long as any Debentures are held by the Property Trustee, the Issuer
Trustees shall not (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or executing any
trust or power conferred on the Property Trustee with respect to such
Debentures, (ii) waive any past default that is waiveable under Section 513 of
the Indenture, (iii) exercise any right to rescind or annul a declaration that
the principal of all the Debentures shall be due and payable or (iv) consent
to any amendment, modification or termination of the Indenture or the
Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the holders of a majority in aggregate
liquidation preference of all outstanding Preferred Securities; provided,
however, that where a consent under the Indenture would require the consent of
each holder of Debentures affected thereby, no such consent shall be given by
the Property Trustee without the prior consent of each holder of the
corresponding Preferred Securities. The Issuer Trustees shall not revoke any
action previously authorized or approved by a vote of the Preferred Securities
except by subsequent vote of the holders of the Preferred Securities. The
Property Trustee shall notify all holders of the Preferred Securities of any
notice of default with respect to the Debentures. In addition to obtaining the
foregoing approvals of the holders of the Preferred Securities, prior to
taking any of the foregoing actions, the Issuer Trustees shall obtain an
opinion of counsel experienced in such matters to the effect that the Issuer
will not be classified as a corporation or partnership for United States
federal income tax purposes on account of such action.
Any required approval of holders of Preferred Securities may be given at a
meeting of holders of Preferred Securities convened for such purpose or
pursuant to written consent. The Property Trustee will cause a notice of any
meeting at which holders of Preferred Securities are entitled to vote, or of
any matter upon which action by written consent of such holders is to be
taken, to be given to each holder of record of Preferred Securities in the
manner set forth in each Trust Agreement.
No vote or consent of the holders of Preferred Securities will be required
for each Issuer to redeem and cancel its Preferred Securities in accordance
with the applicable Trust Agreement.
Notwithstanding that holders of Preferred Securities are entitled to vote or
consent under any of the circumstances described above, any of the Preferred
Securities that are owned by PG&E, the Issuer Trustees or any affiliate of
PG&E or any Issuer Trustee, shall, for purposes of such vote or consent, be
treated as if they were not outstanding.
PAYMENT AND PAYING AGENCY
Payments in respect of the Preferred Securities shall be made to DTC, which
shall credit the relevant accounts at DTC on the applicable Distribution Dates
or, if any Issuer's Preferred Securities are not held by DTC, such payments
shall be made by check mailed to the address of the holder entitled thereto as
such address shall appear on the Register. The paying agent (the "Paying
Agent") shall initially be The First National Bank of Chicago and any co-
paying agent chosen by The First National Bank of Chicago, and acceptable to
the Property Trustee and PG&E. The First National Bank of Chicago shall be
permitted to resign as Paying Agent upon 30 days' written notice to the
Property
9
<PAGE>
Trustee and PG&E, as Depositor. In the event that The First National Bank of
Chicago shall no longer be the Paying Agent, the Property Trustee shall
appoint a successor to act as Paying Agent (which shall be a bank or trust
company).
BOOK-ENTRY-ONLY ISSUANCE -- THE DEPOSITORY TRUST COMPANY
DTC will act as securities depositary for all of the Preferred Securities.
The Preferred Securities will be issued only as fully-registered securities
registered in the name of Cede & Co. (DTC's nominee). One or more fully-
registered global certificates will be issued for the Preferred Securities of
each Issuer, representing in the aggregate the total number of such Issuer's
Preferred Securities, and will be deposited with DTC.
DTC is a limited purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law,
a member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Exchange Act. DTC
holds securities that its participants ("Participants") deposit with DTC. DTC
also facilitates the settlement among Participants of securities transactions,
such as transfers and pledges, in deposited securities through electronic
computerized book-entry changes in Participants' accounts, thereby eliminating
the need for physical movement of securities certificates. Direct Participants
include securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations ("Direct Participants"). DTC is
owned by a number of its Direct Participants and by the New York Stock
Exchange, Inc. (the "New York Stock Exchange"), the American Stock Exchange,
Inc. and the National Association of Securities Dealers, Inc. Access to the
DTC system is also available to others such as securities brokers and dealers,
banks and trust companies that clear through or maintain custodial
relationships with Direct Participants, either directly or indirectly
("Indirect Participants"). The rules applicable to DTC and its Participants
are on file with the Commission.
Purchases of Preferred Securities within the DTC system must be made by or
through Direct Participants, which will receive a credit for the Preferred
Securities on DTC's records. The ownership interest of each actual purchaser
of each Preferred Security ("Beneficial Owner") is in turn to be recorded on
the Direct and Indirect Participants' records. Beneficial Owners will not
receive written confirmation from DTC of their purchases, but Beneficial
Owners are expected to receive written confirmations providing details of the
transactions, as well as periodic statements of their holdings, from the
Direct or Indirect Participants through which the Beneficial Owners purchased
Preferred Securities. Transfers of ownership interests in the Preferred
Securities are to be accomplished by entries made on the books of Participants
acting on behalf of Beneficial Owners. Beneficial Owners will not receive
certificates representing their ownership interests in Preferred Securities,
except in the event that use of the book-entry system for the Preferred
Securities of such Issuer is discontinued.
DTC has no knowledge of the actual Beneficial Owners of the Preferred
Securities; DTC's records reflect only the identity of the Direct Participants
to whose accounts such Preferred Securities are credited, which may or may not
be the Beneficial Owners. The Participants will remain responsible for keeping
account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed
by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time.
Redemption notices shall be sent to Cede & Co. as the registered holder of
the Preferred Securities. If less than all of an Issuer's Preferred Securities
are being redeemed, DTC's practice is to determine by lot the amount of the
interest of each Direct Participant to be redeemed.
10
<PAGE>
Although voting with respect to the Preferred Securities is limited to the
holders of record of the Preferred Securities, in those instances in which a
vote is required, neither DTC nor Cede & Co. will itself consent or vote with
respect to Preferred Securities. Under its usual procedures, DTC would mail an
omnibus proxy (the "Omnibus Proxy") to the Property Trustee as soon as
possible after the record date. The Omnibus Proxy assigns Cede & Co.'s
consenting or voting rights to those Direct Participants to whose accounts
such Preferred Securities are credited on the record date (identified in a
listing attached to the Omnibus Proxy).
Distribution payments on the Preferred Securities will be made by the
Property Trustee to DTC. DTC's practice is to credit Direct Participants'
accounts on the relevant payment date in accordance with their respective
holdings shown on DTC's records unless DTC has reason to believe that it will
not receive payments on such payment date. Payments by Participants to
Beneficial Owners will be governed by standing instructions and customary
practices and will be the responsibility of such Participant and not of DTC,
the Property Trustee, the Issuer thereof or PG&E, subject to any statutory or
regulatory requirements as may be in effect from time to time. Payment of
Distributions to DTC is the responsibility of the Property Trustee,
disbursement of such payments to Direct Participants is the responsibility of
DTC, and disbursements of such payments to the Beneficial Owners is the
responsibility of Direct and Indirect Participants.
DTC may discontinue providing its services as securities depositary with
respect to any of the Preferred Securities at any time by giving reasonable
notice to the Property Trustee and PG&E. In the event that a successor
securities depositary is not obtained, definitive Preferred Security
certificates representing such Preferred Securities are required to be printed
and delivered. The Depositor, at its option, may decide to discontinue use of
the system of book-entry transfers through DTC (or a successor depositary).
After a Debenture Event of Default, the holders of a majority in liquidation
preference of Preferred Securities may determine to discontinue the system of
book-entry transfers through DTC. In any such event, definitive certificates
for such Issuer's Preferred Securities will be printed and delivered.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from sources that the Issuers and PG&E believe to be
accurate, but the Issuers and PG&E assume no responsibility for the accuracy
thereof. Neither the Issuers nor PG&E has any responsibility for the
performance by DTC or its Participants of their respective obligations as
described herein or under the rules and procedures governing their respective
operations.
REGISTRAR AND TRANSFER AGENT
The First National Bank of Chicago will initially act as registrar and
transfer agent for the Preferred Securities.
Registration of transfers of Preferred Securities will be effected without
charge by or on behalf of each Issuer, but upon payment of any tax or other
governmental charges that may be imposed in connection with any transfer or
exchange.
The Issuers will not be required to register or cause to be registered the
transfer of their Preferred Securities after such Preferred Securities have
been called for redemption.
INFORMATION CONCERNING THE PROPERTY TRUSTEE
The Property Trustee, other than during the occurrence and continuance of an
Event of Default, undertakes to perform only such duties as are specifically
set forth in the Trust Agreements and, after an Event of Default, must
exercise the same degree of care and skill as a prudent person would exercise
or use in the conduct of his or her own affairs. Subject to this provision,
the Property Trustee
11
<PAGE>
is under no obligation to exercise any of the powers vested in it by the Trust
Agreement at the request of any holder of Preferred Securities unless it is
offered reasonable indemnity against the costs, expenses and liabilities that
might be incurred thereby. If no Debenture Event of Default has occurred and
is continuing and the Property Trustee is required to decide between
alternative causes of action, construe ambiguous provisions in a Trust
Agreement or is unsure of the application of any provision of a Trust
Agreement, and the matter is not one on which holders of Preferred Securities
are entitled under the Trust Agreement to vote, then the Property Trustee
shall take such action as is directed by PG&E as Depositor and if not so
directed, shall take such action as it deems advisable and in the best
interests of the holders of the Preferred Securities and the Common Securities
and will have no liability except for its own bad faith, negligence or willful
misconduct.
MISCELLANEOUS
The Administrative Trustees are authorized and directed to conduct the
affairs of and to operate the Issuers in such a way that no Issuer will be
deemed to be an "investment company" required to be registered under the
Investment Company Act of 1940 or taxed as a corporation for federal income
tax purposes and so that the Debentures will be treated as indebtedness of
PG&E for United States federal income tax purposes. In this connection, PG&E
and the Administrative Trustees are authorized to take any action, not
inconsistent with applicable law, the certificate of trust of each Issuer or
each Trust Agreement, that PG&E and the Administrative Trustees determine in
their discretion to be necessary or desirable for such purposes, as long as
such action does not materially adversely affect the interests of the holders
of the related Preferred Securities.
Holders of the Preferred Securities have no preemptive or similar rights.
No Issuer may borrow money or issue debt or mortgage or pledge any of its
assets.
DESCRIPTION OF THE GUARANTEE
Each Guarantee will be executed and delivered by PG&E concurrently with the
issuance by each Issuer of its Preferred Securities for the benefit of the
holders from time to time of such Preferred Securities. The First National
Bank of Chicago will act as indenture trustee ("Guarantee Trustee") under each
Guarantee for the purposes of compliance with the Trust Indenture Act. This
summary of certain provisions of the Guarantees does not purport to be
complete and is subject to, and qualified in its entirety by reference to, all
of the provisions of each Guarantee Agreement, including the definitions
therein of certain terms, and the Trust Indenture Act. The form of the
Guarantee has been filed as an exhibit to the Registration Statement of which
this Prospectus forms a part. Reference in this summary to Preferred
Securities means that Issuer's Preferred Securities to which a Guarantee
relates. The Guarantee Trustee will hold each Guarantee for the benefit of the
holders of the related Issuer's Preferred Securities.
GENERAL
PG&E will irrevocably and unconditionally agree on a subordinated basis, to
the extent set forth in each Guarantee, to pay in full, to the holders of the
related Issuer's Preferred Securities, the Guarantee Payments (as defined
below) (except to the extent paid by or on behalf of such Issuer), as and when
due, regardless of any defense, right of set-off or counterclaim which such
Issuer may have or assert. The following payments, to the extent not paid by
an Issuer (the "Guarantee Payments"), will be subject to the applicable
Guarantee (without duplication): (i) any accumulated and unpaid Distributions
required to be paid on such Preferred Securities, to the extent that such
Issuer has funds on hand
12
<PAGE>
available therefor, (ii) the Redemption Price with respect to any Preferred
Securities called for redemption to the extent that such Issuer has funds on
hand available therefor, or (iii) upon a voluntary or involuntary dissolution,
winding up or termination of such Issuer (unless the corresponding series of
Debentures are distributed to holders of such Preferred Securities), the
lesser of (a) the Liquidation Distribution and (b) the amount of assets of
such Issuer remaining available for distribution to holders of Preferred
Securities. PG&E's obligation to make a Guarantee Payment may be satisfied by
direct payment of the required amounts by PG&E to the holders of the
applicable Preferred Securities or by causing the Issuer to pay such amounts
to such holders. While the assets of PG&E will not be available for making
Distributions on any Preferred Securities, PG&E has undertaken under each
Trust Agreement to pay the expenses of the related Issuer. Accordingly, each
Guarantee, together with the related covenants contained in each Trust
Agreement and PG&E's obligations under the Indenture and the Debentures,
provide for PG&E's full and unconditional guarantee of the Preferred
Securities as set forth above.
STATUS OF THE GUARANTEE
Each Guarantee will constitute an unsecured obligation of PG&E and will rank
subordinate and junior in right of payment to all liabilities of PG&E except
those made pari passu or subordinate to such Guarantee expressly by their
terms. The Trust Agreements provide that each holder of Preferred Securities
by acceptance thereof agrees to the subordination provisions and other terms
of the related Guarantee.
Each Guarantee will rank pari passu with all other Guarantees issued by
PG&E. Each Guarantee will constitute a guarantee of payment and not of
collection (i.e., the guaranteed party may institute a legal proceeding
directly against the Guarantor to enforce its rights under the Guarantee
without first instituting a legal proceeding against any other person or
entity). Each Guarantee will be held for the benefit of the holders of the
related Preferred Securities. Each Guarantee will not be discharged except by
payment of the Guarantee Payments in full to the extent not paid by the Issuer
or upon distribution to the holders of the Preferred Securities of the
corresponding series of Debentures.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes which do not materially adversely affect
the rights of holders of the related Preferred Securities (in which case no
vote will be required), no Guarantee may be amended without the prior approval
of the holders of not less than a majority of the aggregate liquidation
preference of such outstanding Preferred Securities. The manner of obtaining
any such approval will be as set forth under "Description of the Preferred
Securities--Voting Rights; Amendment of Trust Agreement." All guarantees and
agreements contained in each Guarantee shall bind the successors, assigns,
receivers, trustees and representatives of PG&E and shall inure to the benefit
of the holders of the related Preferred Securities then outstanding.
EVENTS OF DEFAULT
An event of default under each Guarantee will occur upon the failure of PG&E
to perform any of its payment or other obligations thereunder. The holders of
not less than a majority in aggregate liquidation preference of the related
Preferred Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee in
respect of such Guarantee or to direct the exercise of any trust or power
conferred upon the Guarantee Trustee under such Guarantee.
If the Guarantee Trustee fails to enforce any Guarantee, any holder of the
related Preferred Securities may, after a period of 30 days has elapsed from
such holder's written request to the Guarantee Trustee to enforce such
Guarantee, institute a legal proceeding directly against PG&E to
13
<PAGE>
enforce its rights under such Guarantee without first instituting a legal
proceeding against the Issuer, the Guarantee Trustee or any other person or
entity.
PG&E, as guarantor, is required to file annually with the Guarantee Trustee
a certificate as to whether or not PG&E is in compliance with all the
conditions and covenants applicable to it under the Guarantee.
INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The Guarantee Trustee, other than during the occurrence and continuance of a
default by PG&E in performance of any Guarantee, undertakes to perform only
such duties as are specifically set forth in each Guarantee and, after default
with respect to any Guarantee, must exercise the same degree of care and skill
as a prudent person would exercise or use in the conduct of his or her own
affairs. Subject to this provision, the Guarantee Trustee is under no
obligation to exercise any of the powers vested in it by any Guarantee at the
request of any holder of any Preferred Securities unless it is offered
reasonable indemnity against the costs, expenses and liabilities that might be
incurred thereby.
TERMINATION OF THE GUARANTEE
Each Guarantee will terminate and be of no further force and effect upon
full payment of the Redemption Price of the related Preferred Securities, upon
full payment of the amounts payable upon liquidation of the related Issuer or
upon distribution of Debentures to the holders of the related Preferred
Securities. Each Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any holder of the related
Preferred Securities must restore payment of any sums paid under such
Preferred Securities or such Guarantee.
GOVERNING LAW
Each Guarantee will be governed by and construed in accordance with the laws
of the State of California.
DESCRIPTION OF THE DEBENTURES
This summary of certain terms and provisions of the Debentures and the
Indenture does not purport to be complete and is subject to, and is qualified
in its entirety by reference to the Debentures and the Indenture, the forms of
which are filed as exhibits to the Registration Statement of which this
Prospectus forms a part.
GENERAL
Concurrently with the issuance of each Issuer's Preferred Securities, the
Issuer will invest the proceeds thereof and the consideration paid by PG&E for
the Common Securities in a corresponding series of Debentures issued by PG&E
to the Issuer. The Debentures will be unsecured subordinated obligations of
PG&E issued under the Indenture. Each series of Debentures will be in the
principal amount equal to the aggregate stated liquidation preference of the
related Preferred Securities plus PG&E's concurrent investment in the Common
Securities and will rank pari passu with all other series of Debentures. The
Indenture does not limit the aggregate principal amount of Debentures which
may be issued thereunder.
INTEREST
The Debentures will bear interest at the rate per annum specified in the
Prospectus Supplement. Such interest will be payable quarterly in arrears on
the dates in each year specified in the Prospectus
14
<PAGE>
Supplement (each, an "Interest Payment Date") to the person in whose name each
Debenture is registered, subject to certain exceptions, at the close of
business on the Business Day next preceding such Interest Payment Date. It is
anticipated that the Debentures will be held in the name of the Property
Trustee in trust for the benefit of the holders of the Preferred Securities.
The amount of interest payable for any period will be computed on the basis
of a 360-day year of twelve 30-day months. In the event that any date on which
interest is payable on the Debentures is not a Business Day, then payment of
the interest payable on such date will be made on the next succeeding day
which is a Business Day (and without any interest or other payment in respect
of any such delay), except that, if such Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on the date such payment was originally payable.
SUBORDINATION
The Indenture provides that all payments by PG&E in respect of the
Debentures shall be subordinate to the prior payment in full of all amounts
payable on Senior Indebtedness. The term "Senior Indebtedness" means (i) the
principal of and premium (if any) in respect of (A) indebtedness of PG&E for
money borrowed and (B) indebtedness evidenced by securities, debentures, bonds
or other similar instruments issued by PG&E; (ii) all capital lease
obligations of PG&E; (iii) all obligations of PG&E issued or assumed as the
deferred purchase price of property, all conditional sale obligations of PG&E
and all obligations of PG&E under any title retention agreement (but excluding
trade accounts payable arising in the ordinary course of business); (iv)
certain obligations of PG&E for the reimbursement of any obligor on any letter
of credit, banker's acceptance, security purchase facility, surety bond or
similar credit transaction entered into in the ordinary course of business of
PG&E; (v) all obligations of the type referred to in clauses (i) through (iv)
of other persons and all dividends of other persons (other than Preferred
Securities) for the payment of which, in either case, PG&E is responsible or
liable as obligor, guarantor or otherwise; and (vi) all obligations of the
type referred to in clauses (i) through (v) of other persons secured by any
lien on any property or asset of PG&E (whether or not such obligation is
assumed by PG&E), except for any such indebtedness that is by its terms
subordinated to or pari passu with the Debentures.
Upon any payment or distribution of assets or securities of PG&E upon any
dissolution, winding up, liquidation or reorganization of PG&E, whether
voluntary or involuntary, or in bankruptcy, insolvency, receivership or other
proceedings, all amounts due upon all Senior Indebtedness shall be paid in
full before the holders of the Debentures or the Property Trustee on behalf of
the holders shall be entitled to receive from PG&E any payment of principal
of, premium, if any, or interest on the Debentures or distributions of any
assets or securities.
No payment by or on behalf of PG&E of principal of, premium, if any, or
interest on the Debentures, whether pursuant to the terms of the Debentures or
upon acceleration or otherwise, shall be made if, at the time of such payment,
there exists a default in the payment of all or any portion of any Senior
Indebtedness or any other default pursuant to which the maturity of Senior
Indebtedness has been accelerated.
If the Debenture Trustee or the Property Trustee, as holder of the
Debentures shall have received any payment on account of the principal of,
premium, if any, or interest on the Debentures when such payment is prohibited
and before all amounts payable on Senior Indebtedness are paid in full, then
such payment shall be received and held in trust for the holders of Senior
Indebtedness and shall be paid over or delivered to the holders of the Senior
Indebtedness remaining unpaid to the extent necessary to pay such Senior
Indebtedness in full, provided that requisite notice has been given to PG&E.
15
<PAGE>
Nothing in the Indenture shall limit the right of the Debenture Trustee, the
Property Trustee or the holders of the Debentures to pursue any rights or
remedies under applicable law against PG&E; provided that all Senior
Indebtedness shall be paid before holders of the Debentures are entitled to
receive any payment from PG&E of principal of or interest on the Debentures.
Upon the payment in full of all Senior Indebtedness, the holders of the
Debentures shall be subrogated to the rights of the holders of such Senior
Indebtedness to receive payments or distributions of assets of PG&E made on
such Senior Indebtedness until the Debentures shall be paid in full.
The Indenture does not limit the aggregate amount of Senior Indebtedness
which PG&E may incur.
CERTAIN COVENANTS OF PG&E
PG&E will covenant, as to each series of Debentures, that it will not, and
will not permit any subsidiary of PG&E to, declare or pay any dividend or
distribution on, or redeem, purchase, acquire, or make a liquidation or
guarantee payment (other than payments under a Guarantee) with respect to, any
shares of PG&E's capital stock or any security of PG&E (including other
Debentures) ranking pari passu with or junior in interest to the Debentures,
except (i) in each case with securities junior in interest to the Debentures
or (ii) for payments made on any series of Debentures upon the stated maturity
of such Debentures, if at such time (i) there shall have occurred any event of
which PG&E has actual knowledge that (a) with the giving of notice or the
lapse of time, or both, would constitute an Event of Default with respect to
Debentures of such series and (b) in respect of which PG&E shall not have
taken reasonable steps to cure, (ii) PG&E shall be in default with respect to
its payment of any obligations under the Guarantee relating to the Preferred
Securities of the Trust to which Debentures of such series have been issued or
(iii) PG&E shall have given notice of its selection of an Extension Period as
provided in the Indenture with respect to Debentures of such series and such
Extension Period, or any extension thereof shall have commenced and be
continuing. PG&E will also covenant, as to each series of Debentures, (i) to
maintain directly or indirectly 100% ownership of the Common Securities of the
Issuer to which Debentures have been issued, provided that certain successors
which are permitted pursuant to the Indenture may succeed to PG&E's ownership
of the Common Securities, (ii) not to voluntarily terminate, wind-up or
liquidate any Issuer, except in (A) connection with the distribution of
Debentures to the holders of the Preferred Securities in liquidation of such
Issuer, (B) as permitted by the terms of the Debentures, or (C) in connection
with certain mergers, consolidations or amalgamations permitted by the related
Trust Agreement and (iii) to use its reasonable efforts, consistent with the
terms and provisions of the related Trust Agreement, to cause such Issuer to
remain a business trust and otherwise not to be classified as an association
taxable as a corporation for United States federal income tax purposes.
MODIFICATION OF THE INDENTURE
From time to time, PG&E and the Debenture Trustee may, without the consent
of the holders of any series of Debentures, amend, waive or supplement the
Indenture for specified purposes, including, among other things, curing
ambiguities, defects or inconsistencies, qualifying, or maintaining the
qualification of, the Indenture under the Trust Indenture Act, or making any
other change that does not affect the rights of any holder of Debentures in
any material respect. The Indenture contains provisions permitting PG&E and
the Debenture Trustee, with the consent of the holders of not less than a
majority in principal amount of each outstanding series of Debentures
affected, to modify the Indenture in a manner affecting the rights of the
holders of such series of the Debentures; provided that no such modification
may, without the consent of the holder of each outstanding Debenture so
affected, (i) change the stated maturity of any series of Debentures, or
reduce the principal amount thereof, or reduce the rate or extend the time of
payment of interest thereon, reduce any premium payable upon
16
<PAGE>
redemption of the Debentures, or change any place of payment where, or the
coin or currency in which, any Debenture or any premium or interest is
payable, or impair the right to institute suit for the enforcement of any such
payment on or after the stated maturity or redemption date, or modify the
provisions of the Indenture with respect to the subordination of the
Debentures in a manner adverse to the holders of the Debentures, (ii) reduce
the percentage of principal amount of Debentures of any series, the holders of
which are required to consent to any such modification of the Indenture or
(iii) modify certain provisions of the Indenture relating to the waiver of
past defaults or compliance by PG&E with the covenants therein.
In addition, PG&E and the Debenture Trustee may execute, without the consent
of any holder of Debentures, any supplemental Indenture for the purpose of
creating any new series of Debentures.
EVENTS OF DEFAULT
The Indenture provides that any one or more of the following described
events with respect to a series of Debentures that has occurred and is
continuing constitutes an "Event of Default" with respect to such series of
Debentures:
(a) failure for 30 days to pay any interest on such series of the
Debentures, including any Additional Interest in respect thereof, when due
(subject to the deferral of any due date in the case of an Extension
Period); or
(b) failure to pay any principal on such series of Debentures when due
whether at maturity, upon redemption by declaration or otherwise; or
(c) failure to observe or perform in any material respect certain other
covenants contained in the Indenture for 90 days after written notice to
PG&E from the Debenture Trustee or the holders of at least 25% in principal
amount of such series of outstanding Debentures; or
(d) certain events in bankruptcy, insolvency or reorganization of PG&E.
The holders of a majority in outstanding principal amount of such series of
Debentures have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Debenture Trustee. The
Debenture Trustee or the holders of not less than 25% in aggregate outstanding
principal amount of such series of Debentures may declare the principal due
and payable immediately upon an Event of Default, and should the Debenture
Trustee or such holders of such Debentures fail to make such declaration the
holders of at least 25% in aggregate liquidation preference of Preferred
Securities shall have such right. The holders of a majority in aggregate
outstanding principal amount of such series of Debentures may annul such
declaration and waive the default if the default has been cured (or, in
certain circumstances, even if the default has not been cured) and a sum
sufficient to pay all matured installments of interest and principal due
otherwise than by acceleration and any Additional Interest has been deposited
with the Debenture Trustee.
The holders of a majority in outstanding principal amount of the Debentures
affected thereby may, on behalf of the holders of all the Debentures, waive
any past default, except a default in the payment of principal or interest
(unless such default has been cured and a sum sufficient to pay all matured
installments of interest and principal due otherwise than by acceleration has
been deposited with the Debenture Trustee) or a default in respect of a
covenant or provision which under the Indenture cannot be modified or amended
without the consent of the holder of each outstanding Debenture. PG&E is
required to file annually with the Debenture Trustee a certificate as to
whether or not PG&E is in compliance with all the conditions and covenants
applicable to it under the Indenture.
In case an Event of Default shall occur and be continuing as to a series of
Debentures, the Property Trustee will have the right to declare the principal
of and the interest on such Debentures
17
<PAGE>
(including any Additional Interest) and any other amounts payable under the
Indenture to be forthwith due and payable and to enforce its other rights as a
creditor with respect to such Debentures.
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
The Indenture provides that PG&E may not consolidate with or merge with or
into any other person or sell, convey, transfer or lease its properties and
assets as an entirety or substantially as an entirety to any person, unless
(i) the successor person is a corporation, partnership, trust or other entity
organized and validly existing under the laws of the United States or any
state thereof or the District of Columbia, and expressly assumes by a
supplemental indenture all of the obligations of PG&E under the Debentures,
the Indenture and any Guarantees, (ii) immediately after giving effect to such
transaction and treating any indebtedness which becomes an obligation of PG&E
or any subsidiary as a result of such transaction as having been incurred by
it at the time of the transaction, no Event of Default, and no event which,
after notice or lapse of time or both, would become an Event of Default, shall
have occurred and be continuing, (iii) such transaction does not give rise to
any breach or violation of any Trust Agreement or any Guarantee and (iv)
certain other conditions are met.
SATISFACTION AND DISCHARGE
Under the terms of the Indenture, PG&E will be discharged from any and all
obligations in respect of any series of Debentures (except in each case for
certain obligations to register the transfer or exchange of such Debentures,
replace stolen, lost or mutilated Debentures and hold moneys for payment in
trust) if (subject to certain conditions) PG&E deposits with the Debenture
Trustee, in trust, (i) cash and/or (ii) United States Government Obligations
(as defined in the Indenture), which through the payment of interest thereon
and principal thereof in accordance with their terms will provide cash in an
amount sufficient to pay all the principal of, and interest on, such series of
Debentures on the dates such payments are due in accordance with the terms of
such Debentures.
FORM, EXCHANGE, AND TRANSFER
The Debentures will be issuable only in registered form, without coupons and
only in denominations of $25 and integral multiples thereof.
Subject to the terms of the Indenture, Debentures may be presented for
registration of transfer or exchange (duly endorsed or accompanied by
satisfactory instruments of transfer) at the office of the Security Registrar
or at the office of any transfer agent designated by PG&E for such purpose. No
service charge will be made for any registration of transfer or exchange of
Debentures, but PG&E may require payment of a sum sufficient to cover any tax
or other governmental charge payable in connection therewith. Such transfer or
exchange will be effected upon the Security Registrar or such transfer agent,
as the case may be, being satisfied with the documents of transfer, title and
identity of the person making the request. PG&E has appointed the Debenture
Trustee as the initial Security Registrar. PG&E may at any time designate
additional transfer agents or rescind the designation of any transfer agent or
approve a change in the office through which any transfer agent acts.
If the Debentures are to be redeemed in part, PG&E will not be required to
issue, register the transfer or exchange any Debentures during a period
beginning at the opening of business 15 days before the day of mailing of a
notice of redemption of any such Debentures that may be selected for
redemption and ending at the close of business on the day of such mailing,
except the unredeemed portion of any such Debentures being redeemed in part.
18
<PAGE>
PAYMENT AND PAYING AGENTS
Payment of interest on a Debenture on any Interest Payment Date will be made
to the person in whose name such Debenture (or one or more predecessor
securities) is registered at the close of business on the Regular Record Date
(as defined in the Indenture) for such interest.
Principal or any interest on the Debentures will be payable at the office of
such Paying Agent or Paying Agents as PG&E may designate for such purpose from
time to time, except that at the option of PG&E, payment of any interest may
be made by check mailed to the address of the person entitled thereto as such
address appears in the Security Register or by wire transfer. The corporate
trust office of the Debenture Trustee in Chicago, Illinois is initially
designated as PG&E's sole Paying Agent for payments with respect to the
Debentures. PG&E may at any time designate additional Paying Agents or rescind
the designation of any Paying Agent or approve a change in the office through
which any Paying Agent acts.
GOVERNING LAW
The Indenture and the Debentures will be governed by and construed in
accordance with the laws of the State of California.
INFORMATION CONCERNING THE DEBENTURE TRUSTEE
The Debenture Trustee shall have and be subject to all the duties and
responsibilities specified with respect to an indenture trustee under the
Trust Indenture Act. Subject to such provision, the Debenture Trustee is under
no obligation to exercise any of the powers vested in it by the Indenture at
the request of any holder of Debentures, unless offered reasonable indemnity
by such holder against the costs, expenses and liabilities which might be
incurred thereby. The Debenture Trustee is not required to expend or risk its
own funds or otherwise incur personal financial liability in the performance
of its duties if the Debenture Trustee reasonably believes that repayment or
adequate indemnity is not reasonably assured to it.
The First National Bank of Chicago has a course of regular dealings with
PG&E in the ordinary course of business and from time to time may also make
short-term loans and revolving credit and term loans to PG&E and its
affiliates. The First National Bank of Chicago also serves as trustee for a
PG&E subsidiary's senior and subordinated indentures.
RELATIONSHIP AMONG THE PREFERRED SECURITIES, THE DEBENTURES AND THE GUARANTEES
As long as payments of interest and other payments are made when due on each
series of Debentures, such payments will be sufficient to cover Distributions
and other payments due on the corresponding Preferred Securities, primarily
because (i) the aggregate principal amount of each series of Debentures will
be equal to the sum of the aggregate stated liquidation amount of the
corresponding Preferred Securities and corresponding Common Securities; (ii)
the interest rate and interest and other payment dates on each series of
Debentures will match the Distribution rate and Distribution and other payment
dates for the corresponding Preferred Securities; (iii) each Expense Agreement
entered into by PG&E pursuant to each Trust Agreement provides that PG&E shall
pay for all and any costs, expenses and liabilities of such Issuer except the
Issuer's obligations to holders of its Preferred Securities under such
Preferred Securities; and (iv) each Trust Agreement further provides that the
Issuer will not engage in any activity that is not consistent with the limited
purposes of such Issuer.
Payments of Distributions and other amounts due on the Preferred Securities
(to the extent the Issuer has funds available for the payment of such
Distributions) are guaranteed by PG&E as and to
19
<PAGE>
the extent set forth under "Description of the Guarantee." If and to the
extent that PG&E does not make payments on any series of Debentures, such
Issuer will not pay Distributions or other amounts due on its Preferred
Securities.
If the Guarantee Trustee fails to enforce any Guarantee, a holder of any
related Preferred Security may, after a period of 30 days has elapsed from the
date of such holder's written request to the Guarantee Trustee to enforce such
Guarantee, institute a legal proceeding directly against PG&E to enforce its
rights under such Guarantee without first instituting a legal proceeding
against the Guarantee Trustee, the Issuer or any other person or entity.
Each Issuer's Preferred Securities evidence the rights of the holders
thereof to the benefits of such Issuer, and each Issuer exists for the sole
purpose of issuing its Trust Securities and investing the proceeds thereof in
a corresponding series of Debentures. A principal difference between the
rights of a holder of a Preferred Security and a holder of a Debenture is that
a holder of a Debenture will accrue, and (subject to the permissible extension
of the interest period) is entitled to receive, interest on the principal
amount of Debentures held, while a holder of Preferred Securities is only
entitled to receive Distributions if and to the extent the Issuer has funds
available for the payment of such Distributions.
Upon any voluntary or involuntary termination, winding-up or liquidation of
any Issuer involving the liquidation of the corresponding series of
Debentures, the holders of Preferred Securities will be entitled to receive,
out of assets held by such Issuer, the Liquidation Distribution in cash. See
"Description of the Preferred Securities--Liquidation Distribution Upon
Termination." Upon any voluntary or involuntary liquidation or bankruptcy of
PG&E, the Property Trustee, as holder of the Debentures, would be a
subordinated creditor of PG&E, subordinated in right of payment to all Senior
Indebtedness, but entitled to receive payment in full of principal and
interest, before any stockholders of PG&E receive payments or distributions.
Since PG&E is the guarantor under each Guarantee and has agreed to pay for all
costs, expenses and liabilities of each Issuer (other than the Issuer's
obligations to the holders of its Preferred Securities), the positions of a
holder of such Preferred Securities and a holder of such Debentures relative
to other creditors and to stockholders of PG&E in the event of liquidation or
bankruptcy of PG&E would be substantially the same.
A default or event of default under any Senior Indebtedness would not
constitute a default or Event of Default under the Debentures. However, in the
event of payment defaults under, or acceleration of, Senior Indebtedness, the
subordination provisions of the Debentures provide that no payments may be
made in respect of the Debentures until such Senior Indebtedness has been paid
in full or any payment default thereunder has been cured or waived. Failure to
make required payments on any series of Debentures would constitute an Event
of Default under the Indenture.
PLAN OF DISTRIBUTION
The Preferred Securities may be sold in a public offering to or through
underwriters or dealers designated from time to time. Each Issuer may sell its
Preferred Securities as soon as practicable after effectiveness of the
Registration Statement of which the Prospectus is a part. The names of any
underwriters or dealers involved in the sale of the Preferred Securities of
any particular Issuer in respect of which this Prospectus is delivered, the
number of Preferred Securities to be purchased by any such underwriters and
any applicable commissions or discounts will be set forth in the Prospectus
Supplement.
Underwriters may offer and sell Preferred Securities at a fixed price or
prices, which may be changed, or from time to time at market prices prevailing
at the time of sale, at prices related to such prevailing market prices or at
negotiated prices. In connection with the sale of Preferred Securities,
underwriters may be deemed to have received compensation from PG&E and/or the
applicable Issuer
20
<PAGE>
in the form of underwriting discounts or commissions and may also receive
commissions. Underwriters may sell Preferred Securities to or through dealers,
and such dealers may receive compensation in the form of discounts,
concessions or commissions from the underwriters.
Any underwriting compensation paid by PG&E and/or the applicable Issuer to
underwriters in connection with the offering of Preferred Securities, and any
discounts, concessions or commissions allowed by such underwriters to
participating dealers, will be set forth in an applicable Prospectus
Supplement. Underwriters and dealers participating in the distribution of
Preferred Securities may be deemed to be underwriters, and any discounts and
commissions received by them and any profit realized by them on resale of such
Preferred Securities may be deemed to be underwriting discounts and
commissions, under the Act. Underwriters and dealers may be entitled, under
agreement with PG&E and the applicable Issuer, to indemnification against and
contribution toward certain civil liabilities, including liabilities under the
Act, and to reimbursement by PG&E for certain expenses.
In connection with the offering of the Preferred Securities of any Issuer,
such Issuer may grant to the underwriters an option to purchase additional
Preferred Securities to cover over-allotments, if any, at the initial public
offering price (with an additional underwriting commission), as may be set
forth in the accompanying Prospectus Supplement. If such Issuer grants any
over-allotment option, the terms of such over-allotment option will be set
forth in the Prospectus Supplement for such Preferred Securities.
Underwriters and dealers may engage in transactions with, or perform
services for, PG&E and/or the applicable Issuer and/or any of their affiliates
in the ordinary course of business.
Each Issuer's Preferred Securities will be a new issue of securities and
will have no established trading market. Any underwriters to whom an Issuer's
Preferred Securities are sold by such Issuer for public offering and sale may
make a market in such Preferred Securities, but such underwriters will not be
obligated to do so and may discontinue any market making at any time without
notice. Such Preferred Securities may or may not be listed on a national
securities exchange. No assurance can be given as to the liquidity of or the
existence of trading markets for any Preferred Securities.
EXPERTS
The consolidated balance sheet and statement of consolidated capitalization
of PG&E and subsidiaries as of December 31, 1993 and 1994, and the related
statements of consolidated income, cash flows, common stock equity and
preferred stock, and the schedule of consolidated segment information for each
of the three years in the period ended December 31, 1994, and the related
supplemental schedule incorporated by reference in this Prospectus, have been
audited by Arthur Andersen LLP, independent public accountants, as indicated
in their reports with respect thereto which are incorporated by reference
herein in reliance upon the authority of said firm as experts in accounting
and auditing in giving said reports.
LEGAL MATTERS
Certain legal matters will be passed upon for PG&E and the Issuers by Gary
P. Encinas, Esq., Chief Counsel, Corporate, of PG&E, by Richards, Layton &
Finger, special Delaware counsel to PG&E and the Issuers and by Ballard Spahr
Andrews & Ingersoll, Philadelphia, Pennsylvania, special tax counsel to PG&E.
The validity of the Preferred Securities will be passed on for the
underwriters by Sullivan & Cromwell, Los Angeles, California, who may rely on
the opinions of Mr. Encinas and of Richards, Layton & Finger as to certain
matters of California and Delaware law, respectively. Mr. Encinas and his
associates in PG&E's Law Department who will participate in consideration of
legal matters relating to the Preferred Securities, together with members of
their respective families, own in the aggregate approximately 1,700 shares of
PG&E's common stock.
21
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESEN-
TATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE PRO-
SPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT AND THE PRO-
SPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF ANY OFFER TO
BUY ANY SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS PROSPECTUS SUP-
PLEMENT AND THE PROSPECTUS OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER
TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION
IS UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPEC-
TUS NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES,
CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN OR THEREIN IS COR-
RECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
-----------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PROSPECTUS SUPPLEMENT
Prospectus Summary........................................................ S-3
Risk Factors.............................................................. S-4
PG&E Capital I............................................................ S-6
Pacific Gas and Electric Company.......................................... S-7
Coverage Ratios........................................................... S-7
Use of Proceeds........................................................... S-7
Certain Terms of the Series A Preferred Securities........................ S-8
Certain Terms of the Series A Debentures.................................. S-10
United States Taxation.................................................... S-12
Underwriting.............................................................. S-15
PROSPECTUS
Available Information..................................................... 2
Incorporation of Certain Documents by Reference........................... 2
The Issuers............................................................... 3
Pacific Gas and Electric Company.......................................... 3
Description of the Preferred Securities................................... 4
Description of the Guarantee.............................................. 12
Description of the Debentures............................................. 14
Relationship Among the Preferred Securities, the Debentures and the
Guarantees............................................................... 19
Plan of Distribution...................................................... 20
Experts................................................................... 21
Legal Matters............................................................. 21
</TABLE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
PREFERRED SECURITIES
PG&E CAPITAL I
% CUMULATIVE QUARTERLY INCOME PREFERRED SECURITIES, SERIES A
GUARANTEED TO THE EXTENT THE SERIES A
ISSUER HAS FUNDS AS SET FORTH HEREIN BY
PACIFIC GAS AND ELECTRIC COMPANY
-----------
PROSPECTUS SUPPLEMENT
-----------
REPRESENTATIVES OF THE UNDERWRITERS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.*
<TABLE>
<S> <C>
Filing fees--Securities and Exchange Commission.................. $ 115,517
Printing......................................................... 140,000
Stock Exchange listing fees...................................... 135,000
Legal fees and Blue Sky fees and expenses........................ 200,000
Accounting fees.................................................. 175,000
Fees and expenses of the various trustees........................ 20,000
Rating agencies fees and expenses................................ 201,000
Miscellaneous.................................................... 20,000
----------
Total.......................................................... $1,006,517
==========
</TABLE>
--------
* Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 317 of the California Corporations Code provides for indemnification
of a corporation's directors and officers under certain circumstances. PG&E's
Board of Directors has adopted a resolution regarding PG&E's policy of
indemnification and PG&E maintains insurance which insures directors and
officers of PG&E against certain liabilities. Any agreement relating to the
issuance and sale of the Preferred Securities may provide for indemnification
of the directors and officers of PG&E against certain liabilities, including
liabilities under the Securities Act of 1933.
PG&E, as Depositor, has agreed to indemnify the Issuer Trustees for, and to
hold the Issuer Trustees harmless against, any loss, damage, claims,
liability, penalty or expense incurred without negligence or bad faith on the
part of any Issuer Trustee, arising out of or in connection with the
acceptance or administration of the Trust Agreement, including the costs and
expenses of any Issuer Trustee of defending itself against any claim or
liability in connection with the exercise and performance of any of its powers
or duties under the Trust Agreement.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBERS
--------
<C> <S>
1 Form of Underwriting Agreement (Agreements are substantially
identical except for names and dates).
3-1 Certificate of Trust for PG&E Capital I.
3-2 Certificate of Trust for PG&E Capital II.
3-3 Certificate of Trust for PG&E Capital III.
3-4 Certificate of Trust for PG&E Capital IV.
3-5 Trust Agreement for PG&E Capital I.
3-6 Trust Agreement for PG&E Capital II.
3-7 Trust Agreement for PG&E Capital III.
3-8 Trust Agreement for PG&E Capital IV.
3-9 Form of Amended and Restated Trust Agreement (Agreements for PG&E
Capital I, PG&E Capital II, PG&E Capital III and PG&E Capital IV are
substantially identical except for names and dates).
</TABLE>
II-1
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBERS
--------
<C> <S>
4-1 Form of Preferred Security Certificate for PG&E Capital I, PG&E
Capital II, PG&E Capital III and PG&E Capital IV (included in
Exhibit 3-9).
4-2 Form of Deferrable Interest Subordinated Debenture (included in
Exhibit 4-3).
4-3 Form of Deferrable Interest Subordinated Debenture Indenture.
4-4 Form of Deferrable Interest Subordinated Debenture Supplemental
Indenture.
4-5 Form of Guarantee Agreement (Agreements are substantially identical
except for names and dates).
5-1 Opinion of Gary P. Encinas, Esquire relating to the legality of the
Debentures and the Guarantees, including consent.
5-2 Opinion of Richards, Layton & Finger, special Delaware counsel,
relating to the legality of the Preferred Securities of PG&E Capital
I, including consent.
5-3 Opinion of Richards, Layton & Finger, special Delaware counsel,
relating to the legality of the Preferred Securities of PG&E Capital
II, including consent.
5-4 Opinion of Richards, Layton & Finger, special Delaware counsel,
relating to the legality of the Preferred Securities of PG&E Capital
III, including consent.
5-5 Opinion of Richards, Layton & Finger, special Delaware counsel,
relating to the legality of the Preferred Securities of PG&E Capital
IV, including consent.
8 Opinion of Ballard Spahr Andrews & Ingersoll, special tax counsel, as
to tax matters, including consent.
12-1 Computations of Ratios of Earnings to Fixed Charges (incorporated by
reference to PG&E's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1995, File No. 1-2348).
12-2 Computations of Ratios of Earnings to Combined Fixed Charges plus
Preferred Stock Dividend Requirements (incorporated by reference to
PG&E's Quarterly Report on Form 10-Q for the quarter ended June 30,
1995, File No. 1-2348).
23-1 Consent of Arthur Andersen LLP.
23-2 Consent of Gary P. Encinas, Esquire (included in Exhibit 5-1).
23-3 Consent of Richards, Layton & Finger (included in Exhibits 5-2, 5-3,
5-4, and 5-5).
23-4 Consent of Ballard Spahr Andrews & Ingersoll (included in Exhibit 8).
24 Power of Attorney.
25-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Debenture Trustee under the
Deferrable Interest Subordinated Debenture Indenture and Deferable
Interest Subordinated Supplemental Indenture.
25-2 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Property Trustee under the
Amended and Restated Trust Agreement for PG&E Capital I.
25-3 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Property Trustee under the
Amended and Restated Trust Agreement for
PG&E Capital II.
25-4 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Property Trustee under the
Amended and Restated Trust Agreement for
PG&E Capital III.
</TABLE>
II-2
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBERS
--------
<C> <S>
25-5 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Property Trustee under the
Amended and Restated Trust Agreement for
PG&E Capital IV.
25-6 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Guarantee Trustee under the
Guarantee Agreement for PG&E Capital I.
25-7 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Guarantee Trustee under the
Guarantee Agreement for PG&E Capital II.
25-8 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Guarantee Trustee under the
Guarantee Agreement for PG&E Capital III.
25-9 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Guarantee Trustee under the
Guarantee Agreement for PG&E Capital IV.
</TABLE>
ITEM 17. UNDERTAKINGS
A. TO UPDATE ANNUALLY
The Registrants hereby undertake (1) to file, during any period in which
offers or sales are being made, a post-effective amendment to this
registration statement: (i) to include any prospectus required by Section
10(a)(3) of the Securities Act of 1933; (ii) to reflect in the prospectus any
facts or events arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the information set forth
in the registration statement; notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high and of the estimated maximum offering range may
be reflected in the form of prospectus filed with the Commission pursuant to
Rule 424(b) if, in the aggregate, the changes in volume and price represent no
more than a 20 percent change in the "Calculation of Registration Fee" table
in the effective registration statement; and (iii) to include any material
information with respect to the plan of distribution not previously disclosed
in the registration statement or any material change to such information in
the registration statement; provided, however, that paragraphs (1)(i) and
(1)(ii) do not apply if the information required to be included in a post-
effective amendment by those paragraphs is contained in periodic reports filed
by PG&E pursuant to Section 13 or Section 15(d) of the Securities Exchange Act
of 1934 that are incorporated by reference in the registration statement; (2)
that for the purpose of determining any liability under the Securities Act of
1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof; and (3) to remove from registration by means of a
post-effective amendment any of the securities being registered which remain
unsold at the termination of the offering.
B. INCORPORATION BY REFERENCE
The Registrants hereby undertake that, for purposes of determining any
liability under the Securities Act of 1933, each filing of PG&E's annual
report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange
Act of 1934 that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
II-3
<PAGE>
C. INDEMNIFICATION
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrants, 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 their counsel
the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933 and will be
governed by the final adjudication of such issue.
D. RULE 430A INFORMATION
The undersigned Registrants hereby undertake that:
(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the Registrants pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
E. EQUITY OFFERINGS OF NONREPORTING REGISTRANTS
Each Issuer hereby undertakes to provide to the underwriter at the closing
specified in the underwriting agreement certificates in such denominations and
registered in such names as required by the underwriter to permit prompt
delivery to each purchaser.
II-4
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANTS,
PACIFIC GAS AND ELECTRIC COMPANY, PG&E CAPITAL I, PG&E CAPITAL II, PG&E
CAPITAL III AND PG&E CAPITAL IV, CERTIFY THAT THEY HAVE REASONABLE GROUNDS TO
BELIEVE THEY MEET ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAVE DULY
CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON THEIR BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED IN THE CITY AND COUNTY OF SAN
FRANCISCO, STATE OF CALIFORNIA, ON THIS 18TH DAY OF AUGUST, 1995.
Pacific Gas and Electric Company
Gabriel Togneri
By: ______________________________________
PG&E Capital I
By: Pacific Gas and Electric Company, as
Sponsor
Gabriel Togneri
By: ______________________________________
PG&E Capital II
By: Pacific Gas and Electric Company, as
Sponsor
Gabriel Togneri
By: ______________________________________
PG&E Capital III
By: Pacific Gas and Electric Company, as
Sponsor
Gabriel Togneri
By: ______________________________________
PG&E Capital IV
By: Pacific Gas and Electric Company, as
Sponsor
Gabriel Togneri
By: ______________________________________
II-5
<PAGE>
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATE INDICATED.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
A. Principal Executive Officer or Officers Chairman of the Board, August 18, 1995
Chief Executive Officer
*STANLEY T. SKINNER and Director
B. Principal Financial Officer Senior Vice President and August 18, 1995
Chief Financial Officer
*GORDON R. SMITH
C. Controller or Principal Accounting Officer Vice President and August 18, 1995
Controller
*THOMAS C. LONG
D. Directors
+++
*RICHARD A. CLARKE +
*H. M. CONGER +
*WILLIAM S. DAVILA +
*ROBERT D. GLYNN, JR. +
*RICHARD B. MADDEN +
*GEORGE A. MANEATIS +
*MARY S. METZ ++ Directors August 18, 1995
*WILLIAM F. MILLER +
*REBECCA Q. MORGAN +
*JOHN B. M. PLACE +
*SAMUEL T. REEVES +
*CARL E. REICHARDT +
*JOHN C. SAWHILL +
*ALAN SEELENFREUND +
+++
</TABLE>
*By: Gary P. Encinas
-----------------------------------
(GARY P. ENCINAS, ATTORNEY-IN-FACT)
II-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBERS EXHIBITS
-------- --------
<C> <S>
1 Form of Underwriting Agreement (Agreements are substantially
identical except for names and dates).
3-1 Certificate of Trust for PG&E Capital I.
3-2 Certificate of Trust for PG&E Capital II.
3-3 Certificate of Trust for PG&E Capital III.
3-4 Certificate of Trust for PG&E Capital IV.
3-5 Trust Agreement for PG&E Capital I.
3-6 Trust Agreement for PG&E Capital II.
3-7 Trust Agreement for PG&E Capital III.
3-8 Trust Agreement for PG&E Capital IV.
3-9 Form of Amended and Restated Trust Agreement (Agreements for PG&E
Capital I, PG&E Capital II, PG&E Capital III and PG&E Capital IV are
substantially identical except for names and dates).
4-1 Form of Preferred Security Certificate for PG&E Capital I, PG&E
Capital II, PG&E Capital III and PG&E Capital IV (included in
Exhibit 3-9).
4-2 Form of Deferrable Interest Subordinated Debenture (included in
Exhibit 4-3).
4-3 Form of Deferrable Interest Subordinated Debenture Indenture.
4-4 Form of Deferrable Interest Subordinated Debenture Supplemental
Indenture.
4-5 Form of Guarantee Agreement (Agreements are substantially identical
except for names and dates).
5-1 Opinion of Gary P. Encinas, Esquire relating to the legality of the
Debentures and the Guarantees, including consent.
5-2 Opinion of Richards, Layton & Finger, special Delaware counsel,
relating to the legality of the Preferred Securities of PG&E Capital
I, including consent.
5-3 Opinion of Richards, Layton & Finger, special Delaware counsel,
relating to the legality of the Preferred Securities of PG&E Capital
II, including consent.
5-4 Opinion of Richards, Layton & Finger, special Delaware counsel,
relating to the legality of the Preferred Securities of PG&E Capital
III, including consent.
5-5 Opinion of Richards, Layton & Finger, special Delaware counsel,
relating to the legality of the Preferred Securities of PG&E Capital
IV, including consent.
8 Opinion of Ballard Spahr Andrews & Ingersoll, special tax counsel, as
to tax matters, including consent.
12-1 Computations of Ratios of Earnings to Fixed Charges (incorporated by
reference to PG&E's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1995, File No. 1-2348).
12-2 Computations of Ratios of Earnings to Combined Fixed Charges plus
Preferred Stock Dividend Requirements (incorporated by reference to
PG&E's Quarterly Report on Form 10-Q for the quarter ended June 30,
1995, File No. 1-2348).
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBERS EXHIBITS
-------- --------
<C> <S>
23-1 Consent of Arthur Andersen, LLP.
23-2 Consent of Gary P. Encinas, Esquire (included in Exhibit 5-1).
23-3 Consent of Richards, Layton & Finger (included in Exhibits 5-2, 5-3,
5-4, and 5-5).
23-4 Consent of Ballard Spahr Andrews & Ingersoll (included in Exhibit 8).
24 Power of Attorney.
25-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Debenture Trustee under the
Deferrable Interest Subordinated Debenture Indenture and Deferable
Interest Subordinated Supplemental Indenture.
25-2 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Property Trustee under the
Amended and Restated Trust Agreement for PG&E Capital I.
25-3 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Property Trustee under the
Amended and Restated Trust Agreement for PG&E Capital II.
25-4 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Property Trustee under the
Amended and Restated Trust Agreement for PG&E Capital III.
25-5 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Property Trustee under the
Amended and Restated Trust Agreement for PG&E Capital IV.
25-6 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Guarantee Trustee under the
Guarantee Agreement for PG&E Capital I.
25-7 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Guarantee Trustee under the
Guarantee Agreement for PG&E Capital II.
25-8 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Guarantee Trustee under the
Guarantee Agreement for PG&E Capital III.
25-9 Statement of Eligibility under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as Guarantee Trustee under the
Guarantee Agreement for PG&E Capital IV.
</TABLE>
<PAGE>
Exhibit 1
PACIFIC GAS AND ELECTRIC COMPANY
PG&E CAPITAL ___
Preferred Securities
UNDERWRITING AGREEMENT
----------------------
San Francisco, California
To the Underwriters named in
Schedule I hereto.
Ladies and Gentlemen:
The undersigned, Pacific Gas and Electric Company, a California
corporation (the "Company"), and PG&E Capital ___, a statutory business trust
formed under the laws of the State of Delaware (the "Trust"), hereby confirm
their agreement with the Underwriters named in Schedule I hereto, as follows:
1. Underwriters and Representatives. The term "Underwriters" as used
herein shall mean the one or more persons, firms and corporations named in
Schedule I hereto (including the representatives, if any, hereinafter mentioned
and any underwriter substituted in accordance with the provisions of paragraph 7
hereof), and the term "Representatives" as used herein shall mean the
representative or representatives, if any, designated in Schedule II hereto, who
by signing this Agreement represents or represent that each has been authorized
by the Underwriters to execute this Agreement on their behalf and to act for
them in the manner herein provided. If there are no such representatives, the
term "Representatives" as used herein shall refer to the Underwriters. All
obligations of the Underwriters hereunder are several and not joint.
2. Description of Preferred Securities. The Trust proposes to issue
and sell an aggregate of _______ (the "Firm Securities") and, at the election of
the Underwriters, up to an additional ______ (the "Optional Securities") of its
____% Cumulative Quarterly Income Preferred Securities, Series __ (liquidation
amount $_____ per preferred security) (the "Preferred Securities"), such
securities having the specific terms set forth in Schedule II hereto. The
Preferred Securities represent undivided beneficial interests in the assets of
the Trust, guaranteed by the Company as to the payment of distributions, and as
to payments on liquidation or redemption, to the extent the Trust has funds on
hand therefor set forth in a guarantee agreement (the "Guarantee") between the
Company and The First National Bank of Chicago, as trustee (the "Guarantee
Trustee"). The Firm Securities and the Optional Securities that the
Underwriters elect to purchase pursuant to Section 4 hereof are referred to
collectively as the "Securities". The proceeds of the sale by the Trust of the
Securities and an aggregate of up to _______ (_______ assuming full exercise by
the Underwriters of the over allotment option described herein) of its Common
Securities (liquidation amount $__ per common security) (the "Common
Securities") are to be invested in ____% Junior Subordinated Debentures, Series
__, Due ____ (the "Debentures") of the Company, to be issued pursuant to an
Indenture, as supplemented by the First Supplemental Indenture (as supplemented,
the "Indenture"), between the Company and The First National Bank of Chicago,
as trustee (the "Debenture Trustee").
<PAGE>
3. Representations and Warranties of the Trust and the Company. Each
of the Trust and the Company jointly and severally represent and warrant to the
Underwriters and each person, if any, who controls any Underwriter (other than a
partner of any Underwriter firm or any person controlling any Underwriter who
may be an officer or director of the Company) that:
(a) The Company and the Trust meet the requirements for use of Form
S-3 under the Securities Act of 1933, as amended (the "Act"), the Company
and the Trust have filed with the Securities and Exchange Commission (the
"Commission") one or more registration statements (as specified in Schedule
II hereto) on such Form covering the registration of the Securities, the
Debentures and the Guarantee (collectively, the "Registered Securities")
under the Act, a reasonable number of copies of which have been delivered
to the Representatives, and each such registration statement has been
declared effective by the Commission. Each such registration statement, as
amended at the date hereof, meets the requirements set forth in Rule
415(a)(1)(x) under the Act and complies in all other material respects with
such Rule. The Trust and the Company have filed or propose to file with
the Commission a prospectus supplement specifically relating to the
Securities, a reasonable number of copies of which have been or will be
delivered to the Representatives. Each registration statement, as amended
at the date hereof, including the prospectus included therein, all
documents incorporated by reference therein and all exhibits thereto, but
excluding the Form T-1 of the Trustees under the Indenture, the Guarantee
and the Trust Agreement, is herein referred to as the "Registration
Statement." The prospectus, as supplemented to specifically refer to the
final terms and conditions of the Securities, in the form first filed with
the Commission pursuant to Rule 424 under the Act, including all documents
incorporated by reference therein, is herein referred to as the
"Prospectus," and any preliminary form of the Prospectus is herein referred
to as a "Preliminary Prospectus."
(b) The Commission has not issued an order suspending the
effectiveness of the Registration Statement or preventing or suspending the
use of any Preliminary Prospectus and no proceedings for such purpose are
pending before or, to the knowledge of the Company, threatened by the
Commission; the Registration Statement, as of its effective date (including
the date or dates any amendments thereto became effective), and each
Preliminary Prospectus, as of the issue date thereof, complied in all
material respects with the Act and the rules, regulations and instructions
of the Commission thereunder and neither the Registration Statement, as of
the aforesaid effective date, nor any Preliminary Prospectus or Prospectus,
as of its respective issue date, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading; and as
of the date hereof and at all times subsequent hereto up to each Time of
Delivery as hereinafter defined, the Registration Statement and the
Prospectus, and any amendments or supplements thereto, comply and will
comply in all material respects with the provisions of the Act and the
rules, regulations and instructions of the Commission thereunder, and
neither the Registration Statement nor the Prospectus, nor any amendments
or supplements thereto, contain or will contain any untrue statement of a
material fact or omit or will omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading.
(c) The documents incorporated by reference in the Registration
Statement, in each Preliminary Prospectus and in the Prospectus, when they
were filed with the Commission, complied in all material respects with the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the
rules, regulations and instructions of the Commission thereunder, and
-2-
<PAGE>
any documents so filed and incorporated by reference subsequent to the date
hereof will, when they are filed with the Commission, comply in all
material respects with the requirements of the Exchange Act, and the rules,
regulations and instructions of the Commission thereunder; and none of such
documents includes or will include any untrue statement of a material fact
or omits or will omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(d) Arthur Andersen & Co., who have examined the consolidated
financial statements included or incorporated by reference in the
Registration Statement, in each Preliminary Prospectus and in the
Prospectus, and have issued their opinion thereon, are independent public
accountants within the meaning of the Act and the rules and regulations of
the Commission thereunder.
(e) Subsequent to the respective dates as of which information is
given in the Registration Statement or in the Prospectus, and other than as
disclosed therein, (i) neither the Company nor any of its subsidiaries has,
and, at each Time of Delivery, neither the Company nor any of its
subsidiaries will have, incurred any liabilities or obligations, contingent
or otherwise, which are material in the aggregate to the financial
condition of the Company and its subsidiaries, taken as a whole, and (ii)
there has not occurred, and at each Time of Delivery there will not have
occurred, any material adverse change in the financial position or results
of operations of the Company and its subsidiaries, taken as a whole.
(f) Except as set forth in the Registration Statement or in the
Prospectus, there are no material legal or governmental proceedings to
which the Company or any subsidiary is a party or of which property of the
Company or any subsidiary is the subject and, to the best of the Company's
knowledge, no such proceedings are contemplated by governmental authorities
or others.
(g) This Agreement has been duly authorized, executed and delivered
on behalf of the Company and the Trust and, assuming that it has been duly
authorized, executed and delivered by or on behalf of the Underwriters, is
a valid and binding agreement in accordance with its terms; the Company and
the Trust have or will have, prior to each Time of Delivery, full power and
lawful authority to issue and sell the Securities on the terms and
conditions herein contemplated and such issue and sale have been duly
authorized by such orders of the Commission as are required under the laws
administered by it and (subject to compliance with applicable blue sky laws
of states and other jurisdictions and the receipt of an order of the Public
Utilities Commission of the State of California) no other approval of any
public body is or will, at the Time of Delivery, be necessary in connection
with the issue of the Guarantee or the Debentures or the issue and sale of
the Securities to the Underwriters.
(h) The Company is a corporation duly incorporated, validly existing
and authorized to exercise its corporate powers, rights and privileges
under the laws of the State of California.
(i) The Trust has been duly created and is validly existing as a
statutory business trust under the Business Trust Act of the State of
Delaware (the "Delaware Business Trust Act") with the power and authority
to own property and conduct its business as described in the Prospectus,
-3-
<PAGE>
and has conducted and will conduct no business other than the transactions
contemplated by this Agreement and as described in the Prospectus; the
Trust is not a party to or bound by any agreement or instrument other than
this Agreement, the Amended and Restated Trust Agreement between the
Company and the trustees named therein (the "Trustees") and the agreements
and instruments contemplated by the Trust Agreement and the Prospectus; the
Trust has no liabilities or obligations other than those arising out of the
transactions contemplated by this Agreement and the Trust Agreement and
described in the Prospectus; and the Trust is not a party to or subject to
any action, suit or proceeding of any nature.
(j) The Securities have been duly and validly authorized by the
Trust, and, when issued and delivered against payment therefor as provided
herein, will be duly and validly issued and fully paid and non-assessable
undivided beneficial interests in the assets of the Trust and will conform
to the description thereof contained in the Prospectus; the issuance of the
Securities is not subject to preemptive or other similar rights; the
Securities will have the rights set forth in the Trust Agreement, and the
terms of the Securities are valid and binding on the Trust; the holders of
Securities, as beneficial owners of the Trust, will be entitled to the same
limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the
State of Delaware; provided, however, that the holders of Securities may be
obligated, pursuant to the Trust Agreement, to (i) provide indemnity and/or
security in connection with and pay taxes or governmental charges only from
transfers or exchanges of Securities certificates and the issuance of
replacement certificates and (ii) provide security and indemnity in
connection with requests of or directions to the Property Trustee to
exercise its rights and remedies under the Trust Agreement.
(k) The Common Securities have been duly and validly authorized by
the Trust and upon delivery by the Trust to the Company against payment
therefor as described in the Prospectus, will be duly and validly issued
and fully paid and non-assessable undivided beneficial interests in the
assets of the Trust and will conform to the description thereof contained
in the Prospectus; the issuance of the Common Securities is not subject to
preemptive or other similar rights; and at each Time of Delivery, all of
the issued and outstanding Common Securities of the Trust will be directly
owned by the Company free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity other than pursuant to the
Company's First and Refunding Mortgage, dated December 1, 1920, as amended
and supplemented by the Supplemental Indentures thereto dated April 23,
1925, October 1, 1931, March 1, 1941, September 1, 1947, May 15, 1950, May
1, 1954, May 21, 1958, November 1, 1964, July 1, 1965, July 1, 1969,
January 1, 1975, June 1, 1979, August 1, 1983 and December 1, 1988.
(l) The Guarantee, the Debentures, the Trust Agreement and the
Indenture (the Guarantee, the Debentures, the Trust Agreement and the
Indenture being collectively referred to as the "Company Agreements") have
each been duly authorized and when validly executed and delivered by the
Company and, in the case of the Guarantee, by the Guarantee Trustee, in the
case of the Trust Agreement, by the Trustees and, in the case of the
Indenture, by the Debenture Trustee, and, in the case of the Debentures,
when validly issued by the Company and validly authenticated and delivered
by the Debenture Trustee, will constitute valid and legally binding
obligations of the Company, enforceable in accordance with their respective
terms, except as may be (a) bankruptcy, insolvency or other similar laws
affecting the rights of creditors generally, (b) general principles of
equity (regardless of whether considered in a proceeding in equity or at
law), including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing, (c) the possible
unavailability of specific performance or injunctive relief, (d) the
possible unenforceability under certain circumstances of provisions to the
effect that failure to exercise or delay in exercising rights or remedies
will not operate as a waiver of the right or remedy, (e) the possible
unenforceability under certain circumstances of provisions stating that the
terms and conditions of such documents or instruments may only be waived in
writing, (f) the unenforceability of provisions that limit or restrict
waivers of future acts or defenses, (g) a determination that enforcement
would under certain circumstances violate the enforcing party's implied
covenant of good faith and fair dealing, (h) the possible unenforceability
of liquidated damages provisions if determined to be unreasonable, operate
as a penalty or be otherwise contrary to public policy, and (i) the
unenforceability under certain circumstances of provisions releasing or
indemnifying a party from or against liability for its own wrongful or
negligent acts or where indemnification is contrary to public policy, but
such limitations on the enforceability of such documents or instruments
would not render any of them invalid as a whole or substantially interfere
with the realization of the principal benefits provided thereby;
-4-
<PAGE>
the Debentures are entitled to the benefits of the Indenture; and the
Company Agreements will conform to the descriptions thereof in the
Prospectus.
(m) The issue and sale of the Securities and the Common Securities by
the Trust, the compliance by the Trust with all of the provisions of this
Agreement, the purchase of the Debentures by the Trust, and the
consummation of the transactions herein contemplated will not conflict with
or result in a breach of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which the Trust is a party or by which the
Trust is bound or to which any of the property or assets of the Trust is
subject, nor will such action result in any violation of the provisions of
the Trust Agreement or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the Trust or
any of its properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the issue and sale of the Securities and the
Common Securities by the Trust, the purchase of the Debentures by the Trust
or the consummation by the Trust of the transactions contemplated by this
Agreement, except the issuance of an order of the Public Utilities
Commission of the State of California, the registration under the Act and
the Exchange Act of the Registered Securities, the qualification of the
Trust Agreement, the Indenture and the Guarantee under the Trust Indenture
Act of 1939, as amended (the "TIA"), and such consents, approvals,
authorizations, registrations or qualifications as may be required under
state securities or blue sky laws in connection with the purchase of the
Securities and the distribution of the Securities by the Underwriters.
(n) The issuance by the Company of the Guarantee, the compliance by
the Company with all of the provisions of this Agreement, the execution,
delivery and performance by the Company of the Company Agreements, and the
consummation of the transactions herein and therein contemplated will not
result in a breach of any of the terms or provisions of, or constitute a
default under, the Company's Restated Articles of Incorporation, its
Bylaws, or any indenture, mortgage, deed of trust or other agreement or
instrument to which the Company is a party or by which it is bound.
(o) Neither the Trust nor the Company is, and after giving effect to
the offering and sale of the Securities, neither the Trust nor the Company
will be, an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investment Company
Act of 1940, as amended (the "Investment Company Act").
Notwithstanding anything herein contained, the Trust and the Company make
no warranties to any Underwriter as to untrue statements in, or omissions from,
the Registration Statement, any Preliminary Prospectus or the Prospectus made
solely in reliance upon information furnished herein or in writing to the Trust
and the Company by any Underwriter, directly or through the Representatives,
expressly for use in the Registration Statement, any Preliminary Prospectus or
the Prospectus.
4. Purchase and Sale of Securities. On the basis of the representations
and warranties herein contained and subject to the terms and conditions of this
Agreement, (a) the Trust and the Company agree that the Trust shall issue and
sell to each of the Underwriters, severally and not jointly, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Trust, the
number of Firm Securities set forth after the name of such Underwriter in
Schedule I hereto, at the purchase price set forth in
-5-
<PAGE>
Schedule II hereto and (b) in the event and to the extent that the Underwriters
shall exercise the election to purchase Optional Securities as provided below,
the Trust and the Company agree to issue and sell to each of the Underwriters,
and each of the Underwriters agrees, severally and not jointly, to purchase at
the purchase price per Preferred Security set forth in clause (a) of this
Section 4, that portion of the number of Optional Securities as to which such
election shall have been exercised (to be adjusted by you so as to eliminate
fractional Preferred Securities) determined by multiplying such number of
Optional Securities by a fraction the numerator of which is the maximum number
of Optional Securities which such Underwriter is entitled to purchase as set
forth opposite the name of such Underwriter in Schedule I hereto and the
denominator of which is the maximum number of Optional Securities that all of
the Underwriters are entitled to purchase hereunder.
The Trust and the Company hereby grant to the Underwriters the right to
purchase from the Trust at their election up to _______ Optional Securities, at
the purchase price per Preferred Security set forth in the paragraph above plus
accrued distributions to the date of such purchase, for the sole purpose of
covering overallotments in the sale of the Firm Securities. Any such election
to purchase Optional Securities may be exercised only by written notice from you
to the Company, given within a period of 30 calendar days after the date of this
Agreement, setting forth the aggregate number of Optional Securities to be
purchased and the date on which such Optional Securities are to be delivered, as
determined by you but in no event earlier than the First Time of Delivery (as
defined in Section 6 hereof) or, unless you and the Company otherwise agree in
writing, earlier than two or later than ten business days after the date of such
notice.
As compensation to the Underwriters for their commitments hereunder, and in
view of the fact that the proceeds of the sale of the Securities will be used by
the Trust to purchase the Debentures of the Company, the Company hereby agrees
to pay at each Time of Delivery to ____________________, for the accounts of the
several Underwriters, an amount equal to $______ per Preferred Security for the
Securities to be delivered at each Time of Delivery.
5. Public Offering. The Underwriters agree that as soon as practicable,
in the judgment of the Representatives, they will make a bona fide public
offering of their respective portions of the Securities, at the initial public
offering price set forth in the Prospectus, with such concessions and discounts
to dealers as may be set forth therein. It is understood that after the initial
such offering of the Securities the Underwriters reserve the right to vary the
offering price and any concessions or discounts to dealers and to withdraw,
cancel or modify such offering without notice.
6. Time and Place of Closing. (a) The Securities to be purchased by each
Underwriter hereunder, in definitive form, shall be delivered by or on behalf of
the Trust to ____________________, through the facilities of The Depository
Trust Company ("DTC"), for the account of such Underwriter, against payment by
or on behalf of such Underwriter of the purchase price therefor by wire transfer
of funds to a bank account designated by the Company. The Trust will cause the
certificates representing the Securities to be made available for checking and
packaging at least twenty-four hours prior to the Time of Delivery with respect
thereto at the office of DTC or its designated custodian (the "Designated
Office"). The time and date of such delivery and payment shall be, with respect
to the Firm Securities, 8:00 a.m., San Francisco time, on ______, 1995 or such
other time and date as ____________________ and the Company may agree upon in
writing, and, with respect to the Optional Securities, 8:00 a.m., San Francisco
time, on the date specified by ____________________ in the written notice given
by ____________________ of the Underwriters'
-6-
<PAGE>
election to purchase such Optional Securities, or such other time and date as
____________________ and the Company may agree upon in writing. Such time and
date for delivery of the Firm Securities is herein called the "First Time of
Delivery", such time and date for delivery of the Optional Securities, if not
the First Time of Delivery, is herein called the "Second Time of Delivery", and
each such time and date for delivery is herein called a "Time of Delivery".
At each Time of Delivery, the Company will pay, or cause to be paid, the
commission payable at such Time of Delivery to the Underwriters under Section 4
hereof by wire transfer of funds to a bank account designated by _____________.
On the day immediately following each Time of Delivery, the Company will pay to
__________, by wire transfer of funds to a bank account designated by ________,
interest on the purchase price for one day at the Fed Funds Effective Rate for
such Time of Delivery.
(b) The documents to be delivered at each Time of Delivery by or on behalf
of the parties hereto pursuant to Section 9 hereof, including the cross-receipt
for the Securities and any additional documents requested by the Underwriters
pursuant to Section 9(h) hereof, will be delivered at the offices of the
Company, 31st Floor, 77 Beale Street, San Francisco, California (the "Closing
Location"), and the Securities will be delivered at the Designated Office, all
at such Time of Delivery. A meeting will be held at the Closing Location at
2:00 p.m., San Francisco time, on the business day next preceding such Time of
Delivery, at which meeting the final drafts of the documents to be delivered
pursuant to the preceding sentence will be available for review by the parties
hereto.
It is understood that the Representatives, individually and not as
representatives of the Underwriters, may (but shall not be obligated to) make
payment to the Trust for the Securities to be purchased by any Underwriter or
Underwriters whose funds shall not have been received by the Representatives at
the Time of Delivery as aforesaid, for the account of such Underwriter or
Underwriters. Any such payment by the Representatives shall not relieve such
Underwriter or Underwriters from any of its or their obligations hereunder.
7. Partial Default by Underwriters. If one or more Underwriters shall
default in its or their obligation (otherwise than for some reason sufficient to
justify the cancellation or termination of this Agreement) to purchase and pay
for the Securities which it or they have agreed to purchase and pay for at a
Time of Delivery under this Agreement, and if the number of such Securities:
(a) does not exceed 10% of the aggregate number of Securities, the
non-defaulting Underwriters shall have the right and become obligated
severally to take up and pay for (in addition to the number of Securities
set opposite their respective names in Schedule I attached hereto) the
Securities agreed to be purchased by all such defaulting Underwriters at
such Time of Delivery as nearly as possible in the respective proportions
which the numbers set opposite the names of such non-defaulting
Underwriters in Schedule I attached hereto bear to the aggregate of the
numbers so set opposite the names of all such non-defaulting Underwriters,
provided, however, that in no event shall any non-defaulting Underwriter be
obligated under this paragraph 7(a) to take up and pay for more than one-
ninth of the number of Securities set opposite its name in Schedule I
hereto. The Representatives, for the accounts of the several non-
defaulting Underwriters, may take up and pay for all or any part of such
additional number of Securities to be purchased by each such Underwriter at
such Time of Delivery under this paragraph 7(a), or the Representatives may
find one or more substitute purchasers to purchase such Securities or one
or more of the remaining Underwriters may agree to purchase such Securities
in such proportions as may be approved by the Representatives, in each case
upon the terms herein set
-7-
<PAGE>
forth. In any such event, the Representatives may postpone the time for
delivery of the Securities at such Time of Delivery to a later time on the
day of the Time of Delivery or on the next following business day; or
(b) exceeds 10% of the aggregate number of Securities to be purchased
at such Time of Delivery, the Representatives, at any time within 24 hours
following such Time of Delivery, may arrange for a person or persons
satisfactory to the Company (who may be or may include one or more of the
non-defaulting Underwriters) to take up and pay for, in such proportions as
the Representatives may determine, the number of Securities agreed to be
purchased by all such defaulting Underwriters at such Time of Delivery and,
if such arrangements are so made, the Time of Delivery of the Securities
may be postponed by the Representatives to a later time on said date or
until any time prior to 10:00 A.M., San Francisco Time, on the fourth
succeeding business day and, in such event, the Company and the Trust
agrees to file promptly with the Commission any amendment to the
Registration Statement or supplement to the Prospectus as may be required,
and the delivery of the Securities at such Time of Delivery shall be
subject to the condition that such amendment shall have become effective or
such supplement shall have been filed. If the Securities which any
defaulting Underwriter or Underwriters agreed to purchase and pay for shall
not be purchased by non-defaulting or substituted Underwriters as above
provided, such default shall not relieve any Underwriter from its
obligation to purchase and pay for the number of Securities set opposite
its name in Schedule I hereto, and the Company and the Trust in such event
may elect within a further 24-hour period either (i) to terminate this
Agreement without liability on the part of the Company and the Trust or any
non-defaulting Underwriter, or (ii) to proceed with the sale and delivery
hereunder of less than all of the Securities to be purchased at such Time
of Delivery. If the Company and the Trust shall so elect to proceed, it
shall notify the Representatives within such further 24-hour period and may
postpone the time for delivery of the Securities to be purchased at such
Time of Delivery to a later time on the day of such Time of Delivery or may
postpone the Time of Delivery to any business day within the next seven
days after the day originally specified for the Time of Delivery.
Any action under this paragraph 7 shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
8. Certain Covenants of the Trust and the Company. The Trust and the
Company jointly and severally agree:
(a) To file or transmit for filing with the Commission in the manner
prescribed by Rule 424 under the Act copies of the Prospectus in the form
approved by the Representatives and to make no further amendments or
supplements to the Registration Statement or Prospectus after the date
hereof and prior to the Time of Delivery without the prior consent of the
Representatives which will not unreasonably be withheld;
(b) To use its best efforts to qualify the Registered Securities and
to assist in the qualification of the Registered Securities by or on behalf
of the Representatives for offer and sale under the blue sky laws of such
states and other jurisdictions as the Representatives may designate and to
reimburse the Representatives for fees and out-of-pocket expenses paid by
them or on their behalf to so qualify the Registered Securities for offer
and sale; provided that the Company and
-8-
<PAGE>
the Trust shall not be required to qualify as a foreign corporation or to
file a general consent to service of process in any jurisdiction or pay, or
reimburse the Representatives for, such fees and expenses in an amount
aggregating in excess of $16,000; and to prepare and file, from time to
time, such statements and reports as are or may be required of each of them
as the issuer of the Registered Securities to continue such qualifications
under such blue sky laws in effect for so long a period as the
Representatives may reasonably request;
(c) To furnish to each Representative one signed copy of the
Registration Statement and of all amendments thereto (including all
exhibits except the powers of attorney and those incorporated by
reference), one signed copy (which may be included in the Registration
Statement or amendments thereto) of each consent and certificate or opinion
of independent public accountants and of each other person whose profession
gives authority to statements made by him and who is named in the
Registration Statement as having prepared, certified or reviewed any part
thereof, and to furnish the Representatives sufficient unsigned copies of
the foregoing (other than exhibits) for distribution of one such copy to
itself and each of the other Underwriters;
(d) To make all reasonable effort to deliver to the Underwriters
without charge, prior to 10:00 a.m., New York City time, on the business
day next succeeding the date of this Agreement, and from time to time for a
period of nine months thereafter, as many copies of the Prospectus (and any
amendments or supplements thereto) in New York City as the respective
Underwriters or the Representatives may reasonably request for the purposes
contemplated by the Act;
(e) To advise the Representatives promptly (confirming such advice in
writing) of any request made by the Commission for amendments or
supplements to the Registration Statement or Prospectus or for additional
information with respect thereto and of notice of institution of
proceedings for, or the entry of, a stop order suspending the effectiveness
of the Registration Statement, or any order preventing or suspending the
use of any Preliminary Prospectus or the Prospectus, and if any such order
should be entered by the Commission, to make every reasonable effort to
obtain the lifting or removal thereof as soon as possible;
(f) To advise the Representatives promptly of any order or action of
any court or the Commission and of any order or communication of a public
authority addressed to the Trust or the Company suspending, or threatening
to suspend, the qualification of any of the Registered Securities for sale
and, in the event of any order preventing the offering or sale of any of
the Registered Securities, promptly to use its best efforts to obtain the
withdrawal of such order;
(g) To apply an amount equal to the net proceeds from the sale of the
Securities, in the case of the Trust, and the Debentures, in the case of
the Company, for the purposes set forth in the Prospectus;
(h) As long as any of the Securities shall remain outstanding, to
furnish the Representatives, and each of the other Underwriters on its
request, as soon as practicable, (i) copies of any published reports of the
Company, including the annual report and quarterly reports of the Company
to its shareholders, and (ii) copies of earnings statements of the Company
after the end of each of the first three quarters of the fiscal year;
-9-
<PAGE>
(i) As soon as practicable, to make generally available to its
security holders, and deliver to each of the Underwriters, on request, a
copy of an earning statement of the Company covering a period of at least
twelve months beginning after the effective date of the Registration
Statement (as that term is defined in Rule 158 under the Act), which
earning statement shall be in such form and of such substance as may be
necessary to condition the right of recovery as provided in the last
paragraph of Section 11(a) of the Act;
(j) So long as the Act requires the use of a prospectus in connection
with the sale of the Securities, but not longer than nine months after the
date hereof, if any event shall have occurred as a result of which the
Prospectus as then amended or supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary
in order to make the statements, in the light of the circumstances under
which they are made, not misleading, the Company and the Trust will notify
the Representatives and, upon the request of the Representatives (if made
within such period), will forthwith prepare and furnish to each Underwriter
and to any dealer in securities, a supplement to the Prospectus or an
amended prospectus which will correct such statement or omission. After
nine months from the date hereof, any prospectus or supplement thereto or
amended prospectus required by any Underwriter will be supplied by the
Company and the Trust at the request of such Underwriter but only at the
expense of such Underwriter;
(k) To pay all expenses, fees and taxes in connection with (i) the
preparation and filing of the Registration Statement and the printing of
the copies of the Registration Statement, each Preliminary Prospectus, the
Prospectus and this Agreement (including any attached and related
agreements) required by the Underwriters, (ii) the issue and delivery of
the Securities to the Underwriters, (iii) the qualification of the
Registered Securities under the blue sky laws as aforesaid (including the
fees and expenses of Counsel for the Underwriters but subject to the limits
on such expenses and fees specified in subparagraph (b) of this paragraph
8) and all registrations and listings of the Registered Securities, and
(iv) the furnishing of the opinions of Counsel for the Company and the
Trust, certificates and letters of the independent public accountants and
the certificates referred to in paragraph 9 hereof;
(l) To pay the fees and expenses of Counsel for the Underwriters and
to reimburse the Underwriters for their reasonable out-of-pocket expenses
incurred in contemplation of the performance of this Agreement in the event
that the Underwriters hereunder do not take up and pay for any of the
Securities for a reason expressly permitted by the terms of this Agreement,
the Underwriters agreeing to pay such fees and expenses in any other event,
except as herein otherwise specifically provided;
(m) During the period beginning from the date hereof and continuing
to and including the earlier of (i) the date, after the First Time of
Delivery, on which the distribution of the Securities ceases, as determined
by you and notified to the Company, and (ii) 30 days after the First Time
of Delivery, not to offer, sell, contract to sell or otherwise dispose of
any securities, any other beneficial interests of the Trust, or any
preferred securities or any other securities of the Trust, any other
similar trust or the Company, as the case may be, that are substantially
similar to the Securities, including the Guarantee, or any securities that
are convertible into or exchangeable for, or that represent the right to
receive securities, preferred securities or any such substantially similar
securities of either the Trust, any other similar trust or the Company;
-10-
<PAGE>
(n) That the Board of Directors of the Company will adopt prior to
the First Time of Delivery resolutions in form and content satisfactory to
Counsel for the Underwriters creating or delegating the authority to create
the terms and authorizing the issuance of the Securities;
(o) In the case of the Company, to issue the Guarantee concurrently
with the issue and sale of the Securities as contemplated herein; and
(p) To use its best efforts to list, subject to notice of issuance,
the Securities on the __________ Stock Exchange.
9. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters hereunder, as to the Securities to be delivered at each Time of
Delivery, shall be subject to the condition that all representations,
warranties, and other statements of the Company and the Trust herein, or made
pursuant to this Agreement, are true and correct, except for immaterial details,
the condition that the Company and the Trust perform all their respective
obligations hereunder, except for immaterial delays, and the following
additional conditions precedent:
(a) The Registration Statement shall at such Time of Delivery remain
in effect and no stop order suspending the effectiveness of the
Registration Statement or other order preventing or suspending the use of
the Prospectus shall have been issued and no proceedings for such purposes
shall be pending or threatened by the Commission, and all requests for
additional information on the part of the Commission shall have been
complied with by the Company and the Trust to the satisfaction of the
Commission and the Representatives; and no legal action shall have been
commenced seeking to enjoin the issuance or sale of any of the Securities
or otherwise challenging the legality or enforceability of any of the
Securities or the transactions contemplated hereby.
(b) Prior to such Time of Delivery, (i) the Board of Directors of the
Company or a committee thereof, or an offer with delegated authority shall
have adopted resolutions or executed a certificate, as the case may be, in
form and content satisfactory to Counsel for the Underwriters creating,
establishing or delegating the authority to create the terms and
authorizing the issuance of the Securities, (ii) the Public Utilities
Commission of the State of California and the Commission shall have entered
such orders as are required to permit the issue and sale of the Securities
on the terms set forth in the Prospectus and in this Agreement, (iii) any
other public bodies having jurisdiction over the issue and sale of the
Securities to the Underwriters shall have entered such orders as may be
necessary in this connection, and (iv) all such resolutions and orders
shall be in full force and effect, and all conditions precedent contained
therein shall have been fully complied with.
(c) The Representatives shall have received from Sullivan & Cromwell,
Counsel for the Underwriters, an opinion satisfactory to the
Representatives with respect to the validity of the Securities and with
respect to such other legal matters relating to this Agreement, the
Registration Statement and the Prospectus as the Representatives may
reasonably require.
(d) The Company and the Trust shall have furnished to Sullivan &
Cromwell, Counsel for the Underwriters, such documents and information as
the Representatives or such Counsel may reasonably request for the purpose
of enabling them to pass upon the legal matters referred to above.
-11-
<PAGE>
(e) The Company shall have furnished to the Representatives the
written opinion (a draft of such opinion is attached as Annex I(a) hereto),
dated such Time of Delivery, of Gary P. Encinas, Chief Counsel for the
Company, or other special counsel to the Company, to the effect that:
(i) the Company is a corporation duly incorporated, validly
existing and authorized to exercise its corporate powers, rights and
privileges under the laws of the State of California, is doing
business only in the State of California and has an authorized
capitalization and funded debt as set forth in the Registration
Statement and the Prospectus;
(ii) each of the active subsidiaries owned directly by the Company
is a corporation duly incorporated, validly existing and authorized to
exercise its corporate powers, rights and privileges under the laws of
the jurisdiction in which it was incorporated, and is duly qualified
as a foreign corporation in all other jurisdictions wherein the
character of the properties owned or the nature of the business
transacted makes such qualification necessary; and all the outstanding
shares of such corporations have been validly authorized and issued
and are fully paid and nonassessable;
(iii) the outstanding shares of the common stock and the
preferred stocks of the Company are validly issued, fully paid and
nonassessable and said shares and the Securities conform to the
statements concerning them in the Registration Statement and the
Prospectus;
(iv) the Public Utilities Commission of the State of California
and the Commission have entered such orders as are required to permit
the issue and sale of the Securities on the terms set forth in the
Registration Statement, the Prospectus and this Agreement; and
(subject to compliance with applicable blue sky laws of states and
other jurisdictions) no other approval or authorization of any public
body is necessary in connection with the issue and sale of the
Securities to the Underwriters;
(v) The Trust is not a party to or bound by any agreement or
instrument other than the Trust Agreement, this Agreement and the
agreements and instruments contemplated by the Trust Agreement and the
Prospectus and the Indenture; and to the best of such counsel's
knowledge, there are no legal or governmental proceedings to which the
Trust is a party or of which any property of the Trust is the subject
and no such proceedings are threatened or contemplated by governmental
authorities or threatened by others;
(vi) The Company Agreements have each been duly authorized,
executed and delivered by the Company and such Agreements constitute
valid and legally binding obligations of the Company, enforceable in
accordance with their respective terms,except as may be limited by (a)
bankruptcy, insolvency or other similar laws affecting the rights of
creditors generally, (b) general principles of equity (regardless of
whether considered in a proceeding in equity or at law), including,
without limitation, concepts of materiality, reasonableness, good
faith and fair dealing, (c) the possible unavailability of specific
performance or injunctive relief, (d) the possible unenforceability
under certain circumstances of provisions to the effect that failure
to exercise or delay in exercising
-12-
<PAGE>
rights or remedies will not operate as a waiver of the right or
remedy, (e) the possible unenforceability under certain circumstances
of provisions stating that the terms and conditions of such documents
or instruments may only be waived in writing, (f) the unenforceability
of provisions that limit or restrict waivers of future acts or
defenses, (g) a determination that enforcement would under certain
circumstances violate the enforcing party's implied covenant of good
faith and fair dealing, (h) the possible unenforceability of
liquidated damages provisions if determined to be unreasonable,
operate as a penalty or be otherwise contrary to public policy, and
(i) the unenforceability under certain circumstances of provisions
releasing or indemnifying a party from or against liability for its
own wrongful or negligent acts or where indemnification is contrary to
public policy, but such limitations on the enforceability of such
documents or instruments would not render any of them invalid as a
whole or substantially interfere with the realization of the principal
benefits provided thereby; the Debentures are entitled to the benefits
provided by the Indenture; and the Company Agreements conform in all
material respects to the descriptions thereof in the Prospectus;
(vii) the Registration Statement and the Prospectus (other than
the financial statements included therein, as to which no opinion need
be rendered), and any supplement or amendment thereto, as of their
respective effective or issue dates and as of such Time of Delivery,
complied and comply as to form in all material respects with the
provisions of the Act and the rules, regulations and instructions of
the Commission thereunder, and, as of such respective dates, such
counsel does not know of any untrue statement of a material fact in
the Registration Statement, the Prospectus, or such supplement or
amendment, or of the omission to state in the Registration Statement
or the Prospectus, or such supplement or amendment, a material fact
required to be stated therein or necessary to make the statements
therein not misleading;
(viii) this Agreement has been duly authorized, executed and
delivered on behalf of the Company and the Trust and, assuming that it
has been duly authorized, executed and delivered by or on behalf of
the Underwriters, is a valid and binding agreement in accordance with
its terms (except that rights to indemnity hereunder may be limited
under applicable laws);
(ix) the performance by the Company and the Trust of this
Agreement will not contravene any provision of applicable law (subject
to compliance with applicable blue sky laws of states and other
jurisdictions) or the Restated Articles of Incorporation or Bylaws of
the Company or, to the knowledge of such counsel, any agreement or
other instrument binding upon the Company or the Trust; and
(x) subject to compliance with applicable blue sky laws of states
and other jurisdictions and Section 5(b) of the Act, the Securities
may be marketed in interstate commerce on the terms set forth in the
Registration Statement and Prospectus.
(f) Ballard Spahr Ingersoll & Andrews, special counsel for the Trust
and the Company, shall have furnished to the Representatives their written
opinion (a draft of such opinion is attached as Annex I(b) hereto), dated
such Time of Delivery, in form and substance satisfactory to you, to the
effect that:
-13-
<PAGE>
(i) Such firm confirms its opinion set forth in the Prospectus
under the caption "United States Taxation";
(ii) This Agreement has been duly authorized, executed and
delivered by the Trust; and
(iii) The statements set forth in the Prospectus under the
captions "Description of the Preferred Securities", "Description of
the Guarantee" and "Description of the Debentures", insofar as they
purport to constitute a summary of the terms of the securities therein
described, and under the caption "Underwriting" in the Prospectus
Supplement (other than statements based on information furnished by an
Underwriter expressly for use therein), insofar as they purport to
describe the provisions of the laws and documents referred to therein,
are accurate, complete and fair; and the statements set forth in the
Prospectus Supplement under the caption "United States Taxation",
insofar as they purport to constitute a summary of the laws referred
to therein, are accurate in all material respects.
(g) Richards, Layton & Finger, special Delaware counsel for the Trust
and the Company, shall have furnished to the Representatives their written
opinion (a draft of such opinion is attached as Annex I(c) hereto), dated
such Time of Delivery, in form and substance satisfactory to you, to the
effect that:
(i) The Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Business Trust
Act, and all filings required as of the Time of Delivery under the
laws of the State of Delaware with respect to the creation and valid
existence of the Trust as a business trust have been made;
(ii) Under the Delaware Business Trust Act and the Trust
Agreement, the Trust has the trust power and authority to own property
and conduct its business, all as described in the Prospectus;
(iii) The Trust Agreement constitutes a valid and binding
obligation of the Company and the Trustees and is enforceable against
the Company and the Trustees, in accordance with its terms subject, as
to enforcement, to the effect upon the Trust Agreement of (a)
bankruptcy, insolvency, moratorium, receivership, reorganization,
liquidation, fraudulent conveyance and other similar laws relating to
or affecting the rights and remedies of creditors generally, (b)
principles of equity, including applicable law relating to fiduciary
duties (regardless of whether considered and applied in a proceeding
in equity or at law), and (c) the effect of applicable public policy
on the enforceability of provisions relating to indemnification or
contribution;
(iv) Under the Delaware Business Trust Act and the Trust
Agreement, the Trust has the trust power and authority to (a) execute
and deliver, and to perform its obligations under, this Agreement and
(b) issue and perform its obligations under the Securities and the
Common Securities;
-14-
<PAGE>
(v) Under the Delaware Business Trust Act and the Trust Agreement,
the execution and delivery by the Trust of this Agreement, and the
performance by the Trust of its obligations thereunder, have been duly
authorized by all necessary trust action on the part of the Trust;
(vi) The Securities have been duly authorized by the Trust
Agreement and are duly and validly issued and, subject to the
qualifications set forth herein, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust. The
holders of Securities, as beneficial owners of the Trust, will be
entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the
General Corporation Law of the State of Delaware; provided that such
counsel may note that the holders of Securities may be obligated,
pursuant to the Trust Agreement, to (a) provide indemnity and/or
security in connection with and pay taxes or governmental charges
arising from transfers or exchanges of Securities certificates and the
issuance of replacement Securities certificates and (b) provide
security and indemnity in connection with requests of or directions to
the Property Trustee to exercise its rights and remedies under the
Trust Agreement;
(vii) Under the Delaware Business Trust Act and the Trust
Agreement, the issuance of the Securities is not subject to preemptive
rights;
(viii) The issuance and sale by the Trust of Securities, the
execution, delivery and performance by the Trust of this Agreement,
the consummation by the Trust of the transactions contemplated thereby
and compliance by the Trust with its obligations thereunder will not
violate (a) any of the provisions of the Certificate of Trust of the
Trust or the Trust Agreement, or (b) any applicable Delaware law or
administrative regulation;
(ix) Assuming that the Trust derives no income from or connected
with sources within the State of Delaware and has no assets,
activities (other than maintaining the Delaware Trustee) or employees
in the State of Delaware, no authorization, approval, consent or order
of any Delaware court or governmental authority or agency is required
to be obtained by the Trust solely in connection with the issuance and
sale of the Securities. In rendering the opinion expressed in this
paragraph (ix), such counsel need express no opinion concerning the
securities laws of the State of Delaware; and
(x) Assuming that the Trust derives no income from or connected
with sources within the State of Delaware and has no assets,
activities (other than maintaining the Delaware Trustee) or employees
in the State of Delaware, the holders of the Securities (other than
those holders of the Securities who reside or are domiciled in the
State of Delaware) will have no liability for income taxes imposed by
the State of Delaware solely as a result of their participation in the
Trust, and the Trust will not be liable for any income tax imposed by
the State of Delaware.
(h) The Trust and the Company shall have furnished to the
Representatives certificates, dated as of such Time of Delivery, of an
officer or trustee of the Trust and the Company satisfactory to the
Representatives that, as of such Time of Delivery, he or she does not know
-15-
<PAGE>
of any proceeding instituted or threatened of a character required to be
disclosed in the Registration Statement or in the Prospectus which is not
disclosed therein; that he or she does not know of any contracts which are
required to be referred to in the Registration Statement or in the
Prospectus or filed as exhibits to the Registration Statement, which are
not referred to therein or so filed as exhibits; that, to the best of his
or her knowledge, since the respective dates as of which information is
given in the Registration Statement or in the Prospectus, except to the
extent disclosed therein, (i) neither the Company nor any of its
subsidiaries has incurred any liabilities or obligations, contingent or
otherwise, which are material in the aggregate to the financial condition
of the Company and its subsidiaries, taken as a whole, and (ii) there has
been no material adverse change in the condition or results of operations,
financial or otherwise, of the Company and its subsidiaries, taken as a
whole; that there has been no document required to be filed under the
Exchange Act and the rules and regulations thereunder and which upon such
filing would be deemed to be incorporated by reference in the Registration
Statement or in the Prospectus, which has not been so filed; and that no
stop order suspending the effectiveness of the Registration Statement or
other order preventing or suspending the use of the Prospectus has been
issued and no proceedings for such purposes are pending before or to the
knowledge of the Company and the Trust threatened by the Commission.
(i) The Representatives shall have received from Arthur Andersen &
Co. a letter, dated and delivered to the Representatives at such Time of
Delivery, to the effect set forth in Annex II (a draft of the form of
letter is attached as Annex I(d) hereto).
(j) The Company and the Trust shall have furnished to the
Representatives such other affidavits and certificates as to the accuracy
and completeness of any statement in the Registration Statement or in the
Prospectus as of such Time of Delivery as the Representatives may
reasonably request, upon timely notice.
(k) The Company and the Trust shall have complied with the provisions
of Section 8(d) hereof with respect to the furnishing of prospectuses on
the business day next succeeding the date of this Agreement.
(l) The Securities to be sold by the Trust at such Time of Delivery
shall have been duly listed, subject to notice of issuance, on the ________
Stock Exchange.
All opinions, letters and certificates above mentioned shall be deemed to
be in compliance with this paragraph 9 only if they shall be in form and
substance satisfactory to the Representatives; and there shall be delivered to
the Representatives sufficient copies of the above mentioned legal opinions and
letters for each of the Underwriters.
In case any of the conditions specified above in this paragraph 9 shall not
have been fulfilled at such Time of Delivery, this Agreement may be terminated
by the Representatives upon notice thereof to the Company and the Trust. Any
such termination shall be without further liability of any party to any other
party except as provided in subparagraphs (b), (k) and (l) of paragraph 8
hereof.
-16-
<PAGE>
10. Conditions of the Company's and the Trust's Obligations. The
obligations of the Company and the Trust to sell and deliver the Securities at
each Time of Delivery are subject to the following conditions:
(a) At such Time of Delivery, the order of the Public Utilities
Commission of the State of California and all requisite orders of the
Commission permitting the issue and sale of the Securities shall have been
entered, none of such orders shall contain any conditions deemed by the
Company to be unduly burdensome to it (it being understood that any such
order in effect as of the date hereof contains no such burdensome
conditions) and no stop order suspending the effectiveness of the
Registration Statement or other orders preventing or suspending the use of
the Prospectus shall be in effect and no proceedings therefor shall be
pending before or threatened by the Commission; and
(b) Concurrently with the delivery of the Securities to the
Representatives at such Time of Delivery, the Trust shall receive the full
purchase price of the Securities so delivered.
In case either of the conditions specified above in this paragraph 10 shall
not have been fulfilled at such Time of Delivery, this Agreement may be
terminated by the Company and the Trust, upon notice thereof to the
Representatives. Any such termination shall be without further liability of any
party to any other party except as provided in subparagraphs (b), (k) and (l) of
paragraph 8 hereof.
11. Indemnification and Contribution.
(a) The Company and the Trust will jointly and severally indemnify
and hold harmless each Underwriter and each person, if any, who controls
any Underwriter (other than a director or officer of the Company) within
the meaning of the Act or the Exchange Act against any losses, claims,
damages or liabilities, joint or several, to which such Underwriter, or any
such controlling person, may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon (i) the failure of the
Company and the Trust to obtain any requisite order, approval or
authorization of any public body in connection with the issue and sale of
the Securities to the Underwriters, or (ii) any untrue statement or alleged
untrue statement of any material fact included in the Registration
Statement, or in any Preliminary Prospectus or in the Prospectus, or in any
amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading; and will reimburse each Underwriter and each such controlling
person for any legal or other expenses reasonably incurred by such
Underwriter or such controlling person in connection with investigating or
defending any such loss, claim, damage, liability or action; provided,
however, that the Company and the Trust will not be liable in any such case
to the extent that any such loss, claim, damage, liability or action (x)
arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in the Registration
Statement, or in any Preliminary Prospectus or in the Prospectus, or in any
amendment or supplement thereto, in reliance upon and in conformity with
written information furnished to the Company and the Trust by or on behalf
of any Underwriter, directly or through the Representatives specifically
for use in the preparation thereof, or (y) is caused by any statement in or
omission from the Form T-1 statement signed by the Debenture Trustee under
the Indenture, the Guarantee Trustee under the Guarantee or the Property
Trustee under the Trust
-17-
<PAGE>
Agreement, or (z) arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any
Preliminary Prospectus but eliminated or remedied in the Prospectus to a
person as to whom it shall be established that the Securities in respect of
which such loss, claim, damage, liability or action is asserted shall have
been delivered after sale without being accompanied or preceded by a
Prospectus (excluding documents incorporated by reference) at a time when
such delivery of such Prospectus is required by the Act, provided that the
Company shall have fully complied with any obligation under paragraph 8(d)
hereof. This indemnity agreement will be in addition to any liability
which the Company and the Trust may otherwise have.
(b) Each Underwriter will indemnify and hold harmless the Company and
the Trust, each director and officer of the Company and the Trust and each
person, if any, who controls the Company and the Trust within the meaning
of the Act or the Exchange Act against any losses, claims, damages or
liabilities to which the Company and the Trust or any such person may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in the Registration Statement, or in any Preliminary
Prospectus or in the Prospectus, or in any amendment or supplement thereto,
or arise out of or are based upon the omission or the alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, in each case to the extent, but
only to the extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was made in the Registration Statement, or
in any Preliminary Prospectus or in the Prospectus, or in any amendment or
supplement, in reliance upon and in conformity with written information
furnished to the Company and the Trust by or on behalf of such Underwriter,
directly or through the Representatives, specifically for use in the
preparation thereof; and will reimburse the Company and the Trust and each
person so indemnified for any legal or other expenses reasonably incurred
by the Company and Trust or such person in connection with investigating or
defending any such loss, claim, damage, liability or action. This
indemnity agreement will be in addition to any liability which such
Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under subparagraph
(a) or (b) of this paragraph 11 of notice of the commencement of any action
such indemnified party will, if a claim in respect thereof is to be made
against the indemnifying party under such subparagraph, notify the
indemnifying party in writing of the commencement thereof; but the omission
so to notify the indemnifying party will not relieve it from any liability
which it may have to any indemnified party otherwise than under such
subparagraph. In case any such action shall be brought against any
indemnified party, and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate in, and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party, and after notice from the
indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party will not be liable to such
indemnified party under such subparagraph for any legal or other expenses
subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation. The
indemnified party shall have the right to employ its counsel in any such
action, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the employment of counsel by such
indemnified party has
-18-
<PAGE>
been authorized by the indemnifying party, (ii) the indemnified party shall
have reasonably concluded that there may be a conflict of interest between
the indemnifying party and the indemnified party in the conduct of the
defense of such action (in which case the indemnifying party shall not have
the right to direct the defense of such action on behalf of the indemnified
party) or (iii) the indemnifying party shall not in fact have employed
counsel to assume the defense of such action. An indemnifying party shall
not be liable for any settlement of any action or claim effected without
its consent.
(d) If recovery is not available under the foregoing indemnification
provisions of this paragraph 11, for any reason other than as specified
therein, the parties entitled to indemnification by the terms thereof shall
be entitled to contribution for liabilities and expenses, except to the
extent that contribution is not permitted under Section 11(f) of the Act.
In determining the amount of contribution to which the respective parties
are entitled, there shall be considered the relative benefits received by
each party from the offering of the Securities (taking into account the
portion of the proceeds of the offering realized by each), the parties'
relative knowledge and access to information concerning the matter with
respect to which the claim was asserted, the opportunity to correct and
prevent any statement or omission, and any other equitable considerations
appropriate under the circumstances. The Company and the Underwriters
agree that it would not be equitable if the amount of such contribution
were determined by pro rata or per capita allocation (even if the
Underwriters were treated as one entity for such purpose). No Underwriter
or person controlling such Underwriter shall be obligated to make
contribution hereunder which in the aggregate exceeds the total public
offering price of the Securities purchased by such Underwriter under this
agreement, less the aggregate amount of any damages which such Underwriter
and its controlling persons have otherwise been required to pay in respect
of the same claim or any substantially similar claim. The Underwriters'
obligations to contribute are several in proportion to their respective
purchase obligations and not joint.
12. Survival of Warranties, etc. The indemnity and contribution
agreements contained in paragraph 11 hereof and the representations, warranties
and other statements of the Company and the Trust in this Agreement, or made
pursuant to this Agreement, shall remain in full force and effect regardless of
(i) any termination of this Agreement, (ii) any investigation made by or on
behalf of any Underwriter or controlling person or by or on behalf of the
Company or the Trust, or any of its officers, directors or controlling persons
and (iii) acceptance of and payment for the Securities hereunder.
13. Effective Date of this Agreement; Termination. This Agreement shall
become effective upon release by the Representatives of the Securities for sale
to the public. For purposes of this paragraph 13 the Securities shall be deemed
to have been released for sale to the public upon release by the Representatives
of a newspaper advertisement relating to the Securities or upon release by the
Representatives of telegrams, or other equivalent standard form of
telecommunication, offering the Securities for sale to securities dealers,
whichever shall first occur. Until such time, this Agreement may be terminated
by the Company and the Trust by notice to the Representatives, or by the
Representatives by notice to the Company and the Trust.
In addition to the foregoing provisions and to the applicable provisions
contained in paragraphs 7, 9 and 10 hereof, this Agreement may also be
terminated at any time prior to such Time of Delivery by the Representatives if
at or prior to a Time of Delivery (i) trading in the Company's securities or in
securities generally on the New York or American Stock Exchanges shall have been
suspended by the Commission or other governmental authority or by either such
Exchange, or a banking moratorium shall
-19-
<PAGE>
have been declared by New York or United States governmental authorities; (ii)
there shall have been an outbreak or escalation of war or other major
hostilities involving the United States which, in the judgment of the
Representatives, makes it impracticable or inadvisable to offer or sell the
Securities; (iii) the Company shall have sustained a material and substantial
loss by fire, flood, accident, earthquake or other calamity, whether or not said
loss shall have been insured; (iv) there shall have occurred any change in the
financial position or results of operation of the Company and its subsidiaries,
taken as a whole, from that set forth in the Prospectus, that, in the judgment
of the Representatives, makes it impracticable or inadvisable to offer or sell
the Securities; (v) there shall have been any decrease in the ratings of any of
the Company's debt securities or preferred stock, or any public announcement
that such ratings are under review or surveillance with negative implications by
Moody's Investors Service, Inc., or Standard & Poor's Ratings Group; or (vi)
there shall have occurred any other condition of termination set forth in
Schedule II hereto. If the Representatives elect to terminate this Agreement, as
provided in this paragraph 13, the Company, the Trust and each other Underwriter
shall be notified promptly by telephone, telegram or other equivalent standard
form of telecommunication, confirmed in writing.
If this Agreement shall be terminated for any reason permitted under this
Agreement, or if the sale of the Securities to the Underwriters as herein
contemplated shall not be carried out because the Company or the Trust is not
able to comply with the terms hereof, the Company and the Trust shall not be
under any obligation under this Agreement and shall not be liable to any
Underwriter or to any member of any selling group for the loss of anticipated
profits from the transactions contemplated in this Agreement (except that the
Company and the Trust shall remain liable to the extent provided in
subparagraphs (b), (k) and (l) of paragraph 8 hereof) and the Underwriters,
other than a defaulting Underwriter, if any, shall be under no liability to the
Company or the Trust nor be under any liability to one another under this
Agreement.
14. Notices. All statements, requests, notices and agreements hereunder
shall be in writing, or by telegram or other equivalent standard form of
telecommunication, and if to the Underwriters or the Representatives shall be
sufficient in all respects if delivered or sent to the Representatives at the
address specified in Schedule II hereto, and, if to the Company or the Trust,
shall be sufficient in all respects if delivered or sent to the Company or the
Trust, attention of Ms. Leslie Everett, Corporate Secretary, at 77 Beale Street,
P.0. Box 770000, San Francisco, California, 94177.
15. Parties in Interest. This Agreement shall inure solely to the benefit
of the Company, the Trust and the Underwriters and, to the extent provided in
paragraph 11 hereof, to any officer or director of the Company or the Trust or
to any person who controls the Company, the Trust or any Underwriter, and their
respective successors. No other person, partnership, association or corporation
shall acquire or have any right under or by virtue of this Agreement. The term
"successors" shall not include any purchaser of any of the Securities from any
Underwriter merely because of such purchase.
16. Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
-20-
<PAGE>
Please confirm that the foregoing correctly sets forth the agreement
between us by signing in the space provided below for that purpose, whereupon
this letter shall constitute a binding agreement between the Company, the Trust
and the Underwriters in accordance with its terms.
Very truly yours,
Pacific Gas and Electric Company
By
---------------------------------------
Gordon R. Smith
Senior Vice-President and Chief Financial
Officer
PG&E CAPITAL -
By: Pacific Gas and Electric Company, as
Depositor
By
---------------------------------------
Gordon R. Smith
Senior Vice-President and Chief Financial
Officer
Confirmed as of the date of this Agreement
specified in Schedule II hereto:
------------------------------------------
-21-
<PAGE>
On behalf of themselves and as Representatives
of the several Underwriters named in
Schedule I hereto.
-22-
<PAGE>
SCHEDULE I
<TABLE>
<CAPTION>
Number of
Optional
Securities if
Number of Maximum
Firm Option is
Underwriter Securities Exercised
----------- ---------- --------------
<S> <C> <C>
Total..................................
========== ==============
</TABLE>
-23-
<PAGE>
SCHEDULE II
Preferred Securities
<TABLE>
<S> <C>
Title: ____% Cumulative Quarterly Income Preferred
Securities, Series A (liquidation amount $____ per
preferred security)
Distribution Rate: ___%, from and including the original date of
issue.
Redemption Provisions: The Securities will not be redeemable prior to
___________, 2000; on and after that date, the
Securities will be redeemable at the option of the
Trust, in whole or in part, at any time, on not
less than 30 days' or more than 60 days' notice at
the redemption prices stated in the Prospectus
plus an amount equal to the accumulated and unpaid
dividends thereon, if any, to and including the
date of redemption.
Other Terms: The Securities shall have such other terms as are
stated in the Prospectus.
Purchase Price: $_____ per Security.
Date and Time of Closing: 8:00 A.M., San Francisco Time, on ________, 1995.
Names of Representatives:
(with address for notices)
Date of Purchase Agreement: _____________, 1995
Registration Statement: Registration No. 33-_______________
</TABLE>
-24-
<PAGE>
ANNEX II
Pursuant to Section 9(i) of the Underwriting Agreement, the
accountants shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect to
the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules (and, if applicable, financial
forecasts and/or pro forma financial information) examined by them and
included or incorporated by reference in the Registration Statement or the
Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Act or the Exchange Act, as applicable, and
the related published rules and regulations thereunder; and they have made
a review in accordance with standards established by the American Institute
of Certified Public Accountants of the consolidated interim financial
statements, as indicated in their reports thereon, copies of which have
been furnished to the representatives of the Underwriters (the
"Representatives");
(iii) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets
and consolidated statements of cash flows included in the Prospectus and/or
included in the Company's quarterly reports on Form 10-Q incorporated by
reference into the Prospectus; and on the basis of specified procedures
including inquiries of officials of the Company who have responsibility for
financial and accounting matters regarding whether the unaudited condensed
consolidated financial statements referred to in paragraph (vi)(A)(i) below
comply as to form in all material respects with the applicable accounting
requirements of the Act and the Exchange Act and the related published
rules and regulations, nothing came to their attention that caused them to
believe that the unaudited condensed consolidated financial statements do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the Exchange Act and the related
published rules and regulations;
(iv) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest
-1-
<PAGE>
available interim financial statements of the Company and its subsidiaries,
inspection of the minute books of the Company and its subsidiaries since
the date of the latest audited financial statements included or
incorporated by reference in the Prospectus, inquiries of officials of the
Company and its subsidiaries responsible for financial and accounting
matters and such other inquiries and procedures as may be specified in such
letter, nothing came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus and/or included or incorporated
by reference in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus do not comply as to form
in all material respects with the applicable accounting requirements
of the Exchange Act and the related published rules and regulations,
or (ii) any material modifications should be made to the unaudited
condensed consolidated statements of income, consolidated balance
sheets and consolidated statements of cash flows included in the
Prospectus or included in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus, for them to be in
conformity with generally accepted accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited consolidated
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in Clause (B) were not determined on a
basis substantially consistent with the basis for the audited
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of those
statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there has been any decrease in common stock
equity (in excess of 3%) or any increase in the consolidated short-
term debt (in excess of 10% and such increase equals at least $100
million) or long-term debt (in excess of 5%) of the Company and its
subsidiaries, or other items reasonably specified by the
Representatives, in each case as compared with amounts shown in the
latest balance sheet included or
-2-
<PAGE>
incorporated by reference in the Prospectus, except in each case for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in Clause (E) there were any decreases
in operating revenues, net income, earnings available for common stock
or earnings per common share or other items specified by the
Representatives, or any increases in any items reasonably specified by
the Representatives, or there were any significant events from the
date of the latest available unaudited consolidated financial
statements through the specified date referred to in Clause (E) that
would decrease operating revenues, net income, earnings available for
common stock or earnings per common share for the month in which such
specified date occurs and any prior month not included in the latest
available unaudited consolidated financial statements in each case as
compared with the comparable period of the preceding year and with any
other period of corresponding length specified by the Representatives,
except in each case for increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in such
letter; and
(v) In addition to the examination referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minutes books, inquiries and other procedures
referred to in paragraphs (iii) and (vi) above, they have carried out
certain specified procedures, not constituting an examination in accordance
with generally accepted auditing standards, with respect to certain
amounts, percentages and financial information specified by the
Representatives which are derived from the general accounting records of
the Company and its subsidiaries, which appear in the Prospectus (excluding
documents incorporated by reference), or in Part II of, or in exhibits and
schedules to, the Registration Statement specified by the Representatives,
or in documents incorporated by reference in the Prospectus specified by
the Representatives, and have compared certain of such amounts, percentages
and financial information with the accounting records of the Company and
its subsidiaries and have found them to be in agreement.
All references in this Annex II to the Prospectus shall be deemed to
refer to the Prospectus (including the documents incorporated by reference
therein) as defined in the Underwriting Agreement and to the Prospectus as
amended or supplemented (including the documents incorporated by reference
therein) in relation to the Securities for purposes of the letter delivered at
the Time of Delivery for such Securities.
-3-
<PAGE>
Exhibit 3-1
CERTIFICATE OF TRUST
OF
PG&E CAPITAL I
THIS CERTIFICATE OF TRUST of PG&E Capital I (the "Trust"), dated
August 14, 1995, is being duly executed and filed by the undersigned, as
trustees, to form a business trust under the Delaware Business Trust Act (12
Del. C. (S) 3801 et seq.).
(i) Name. The name of the business trust being formed hereby is PG&E
Capital I.
(ii) Delaware Trustee. The name and business address of the trustee
of the Trust with a principal place of business in the State of Delaware are
Michael J. Majchrzak, c/o FCC National Bank, 300 King Street, Wilmington,
Delaware 19801.
(iii) Counterparts. This Certificate of Trust may be executed in one
or more counterparts, all of which together shall constitute one and the same
instrument.
(iv) Effective Date. This Certificate of Trust shall be effective as
of its filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have executed this Certificate of Trust as of the date first above written.
THE FIRST NATIONAL BANK OF
CHICAGO, as Trustee
Gabriel B. Togneri By: John R. Prendiville
------------------------------ -----------------------------
Gabriel B. Togneri, as Trustee Name: John R. Prendiville
Title: Vice President
Leslie Guliasi Michael J. Majchrzak
------------------------------ --------------------------------
Leslie Guliasi, as Trustee Michael J. Majchrzak, as Trustee
Alan H. Lindstrom
------------------------------
Alan H. Lindstrom, as Trustee
<PAGE>
Exhibit 3-2
CERTIFICATE OF TRUST
OF
PG&E CAPITAL II
THIS CERTIFICATE OF TRUST of PG&E Capital II (the "Trust"), dated
August 14, 1995, is being duly executed and filed by the undersigned, as
trustees, to form a business trust under the Delaware Business Trust Act (12
Del. C. (S) 3801 et seq.).
(i) Name. The name of the business trust being formed hereby is PG&E
Capital II.
(ii) Delaware Trustee. The name and business address of the trustee
of the Trust with a principal place of business in the State of Delaware are
Michael J. Majchrzak, c/o FCC National Bank, 300 King Street, Wilmington,
Delaware 19801.
(iii) Counterparts. This Certificate of Trust may be executed in one
or more counterparts, all of which together shall constitute one and the same
instrument.
(iv) Effective Date. This Certificate of Trust shall be effective as
of its filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have executed this Certificate of Trust as of the date first above written.
THE FIRST NATIONAL BANK OF
CHICAGO, as Trustee
Gabriel B. Togneri By: John R. Prendiville
------------------------------ -----------------------------
Gabriel B. Togneri, as Trustee Name: John R. Prendiville
Title: Vice President
Leslie Guliasi Michael J. Majchrzak
------------------------------ --------------------------------
Leslie Guliasi, as Trustee Michael J. Majchrzak, as Trustee
Alan H. Lindstrom
------------------------------
Alan H. Lindstrom, as Trustee
<PAGE>
Exhibit 3-3
CERTIFICATE OF TRUST
OF
PG&E CAPITAL III
THIS CERTIFICATE OF TRUST of PG&E Capital III (the "Trust"), dated
August 14, 1995, is being duly executed and filed by the undersigned, as
trustees, to form a business trust under the Delaware Business Trust Act (12
Del. C. (S) 3801 et seq.).
(i) Name. The name of the business trust being formed hereby is PG&E
Capital III.
(ii) Delaware Trustee. The name and business address of the trustee
of the Trust with a principal place of business in the State of Delaware are
Michael J. Majchrzak, c/o FCC National Bank, 300 King Street, Wilmington,
Delaware 19801.
(iii) Counterparts. This Certificate of Trust may be executed in one
or more counterparts, all of which together shall constitute one and the same
instrument.
(iv) Effective Date. This Certificate of Trust shall be effective as
of its filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have executed this Certificate of Trust as of the date first above written.
THE FIRST NATIONAL BANK OF
CHICAGO, as Trustee
Gabriel B. Togneri By: John R. Prendiville
------------------------------ -----------------------------
Gabriel B. Togneri, as Trustee Name: John R. Prendiville
Title: Vice President
Leslie Guliasi Michael J. Majchrzak
------------------------------ --------------------------------
Leslie Guliasi, as Trustee Michael J. Majchrzak, as Trustee
Alan H. Lindstrom
------------------------------
Alan H. Lindstrom, as Trustee
<PAGE>
Exhibit 3-4
CERTIFICATE OF TRUST
OF
PG&E CAPITAL IV
THIS CERTIFICATE OF TRUST of PG&E Capital IV (the "Trust"), dated
August 14, 1995, is being duly executed and filed by the undersigned, as
trustees, to form a business trust under the Delaware Business Trust Act (12
Del. C. (S) 3801 et seq.).
(i) Name. The name of the business trust being formed hereby is PG&E
Capital IV.
(ii) Delaware Trustee. The name and business address of the trustee
of the Trust with a principal place of business in the State of Delaware are
Michael J. Majchrzak, c/o FCC National Bank, 300 King Street, Wilmington,
Delaware 19801.
(iii) Counterparts. This Certificate of Trust may be executed in one
or more counterparts, all of which together shall constitute one and the same
instrument.
(iv) Effective Date. This Certificate of Trust shall be effective as
of its filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have executed this Certificate of Trust as of the date first above written.
THE FIRST NATIONAL BANK OF
CHICAGO, as Trustee
Gabriel B. Togneri By: John R. Prendiville
------------------------------ -----------------------------
Gabriel B. Togneri, as Trustee Name: John R. Prendiville
Title: Vice President
Leslie Guliasi Michael J. Majchrzak
------------------------------ --------------------------------
Leslie Guliasi, as Trustee Michael J. Majchrzak, as Trustee
Alan H. Lindstrom
------------------------------
Alan H. Lindstrom, as Trustee
<PAGE>
Exhibit 3-5
TRUST AGREEMENT
---------------
This TRUST AGREEMENT, dated as of August 14, 1995, among Pacific Gas
and Electric Company, a California corporation, as "Depositor," The First
National Bank of Chicago, a banking association organized under the laws of the
United States, Michael J. Majchrzak, Gabriel B. Togneri, Leslie Guliasi and Alan
H. Lindstrom, not in their individual capacities but solely as Trustees. The
Depositor and the Trustees hereby agree as follows:
1. The trust created hereby shall be known as "PG&E Capital I," in
which name the Trustees, or the Depositor to the extent provided herein, may
conduct the business of the Trust, make and execute contracts, and sue and be
sued.
2. The Depositor hereby assigns, transfers, conveys and sets over to
the Trustees the sum of $10. The Trustees hereby acknowledge receipt of such
amount in trust from the Depositor, which amount shall constitute the initial
trust estate. The Trustees hereby declare that they will hold the trust estate
in trust for the Depositor. It is the intention of the parties hereto that the
Trust created hereby constitute a business trust under Chapter 38 of Title 12 of
the Delaware Code, 12 Del. C. (S) 3801 et seq. (the "Business Trust Act"), and
------- -- ---
that this document constitutes the governing instrument of the Trust. The
Trustees are hereby authorized and directed to execute and file a certificate of
trust with the Delaware Secretary of State in accordance with the provisions of
the Business Trust Act.
3. The Depositor and the Trustees will enter into an amended and
restated Trust Agreement, satisfactory to each such party and substantially in
the form included as Exhibit 4.1 to the 1933 Act Registration Statement referred
to below, to provide for the contemplated operation of the Trust created hereby
and the issuance of the Preferred Securities and Common Securities referred to
therein. Prior to the execution and delivery of such amended and restated Trust
Agreement, the Trustees shall not have any duty or obligation hereunder or with
respect to the trust estate, except as otherwise required by applicable law or
as may be necessary to obtain prior to such execution and delivery of any
licenses, consents or approvals required by applicable law or otherwise.
4. The Depositor and the Trustees hereby authorize and direct the
Depositor, as the sponsor of the
<PAGE>
Trust, (i) to file with the Securities and Exchange Commission (the
"Commission") and execute, in each case on behalf of the Trust, (a) the
Registration Statement on Form S-3 and S-4 (the "1933 Act Registration
Statement"), including any pre-effective or post-effective amendments to such
1933 Act Registration Statement (including the prospectus and the exhibits
contained therein), relating to the registration under the Securities Act of
1933, as amended, of the Preferred Securities of the Trust and certain other
securities and (b) a Registration Statement on Form 8-A (the "1934 Act
Registration Statement") (including all pre-effective and post-effective
amendments thereto) relating to the registration of the Preferred Securities of
the Trust under Section 12(b) of the Securities Exchange Act of 1934, as
amended; (ii) to file with the New York, American or Pacific Stock Exchange
(each an "Exchange") and execute on behalf of the Trust one or more listing
applications and all other applications, statements, certificates, agreements
and other instruments as shall be necessary or desirable to cause the Preferred
Securities to be listed on any of the Exchanges; (iii) to file and execute on
behalf of the Trust such applications, reports, surety bonds, irrevocable
consents, appointments of attorney for service of process and other papers and
documents as shall be necessary or desirable to register the Preferred
Securities under the securities or "Blue Sky" laws of such jurisdictions as the
Depositor, on behalf of the Trust, may deem necessary or desirable and (iv) to
execute on behalf of the Trust that certain Underwriting Agreement relating to
the Preferred Securities, among the Trust, the Depositor and the several
Underwriters named therein, substantially in the form included as Exhibit 1 to
the 1933 Act Registration Statement. In the event that any filing referred to in
clauses (i), (ii) and (iii) above is required by the rules and regulations of
the Commission, the Exchange or state securities or blue sky laws, to be
executed on behalf of the Trust by any of the Trustees, each of Gabriel B.
Togneri, Leslie Guliasi and Grace U. Shin in their capacities as Trustees of the
Trust, is hereby authorized and directed to join in any such filing and to
execute on behalf of the Trust any and all of the foregoing. In connection with
all of the foregoing, the Depositor hereby constitutes and appoints Gabriel B.
Togneri, Gary P. Encinas, Julie C. Gavin and Alan H. Lindstrom, and each of
them, as its true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for the Depositor or in the Depositor's name,
place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to the 1933 Act Registration Statement and
the 1934 Act Registration Statement and to file the same, with all exhibits
thereto, and other documents in
2
<PAGE>
connection therewith, with the Commission, granting unto said attorneys-in-fact
and agents full power and authority to do and perform each and every act and
thing requisite and necessary to be done in connection therewith, as fully to
all intents and purposes as the Depositor might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents or any of
them, or their respective substitute or substitutes, shall do or cause to be
done by virtue hereof.
5. This Trust Agreement may be executed in one or more counterparts.
6. The number of Trustees initially shall be five (5) and thereafter
the number of Trustees shall be such number as shall be fixed from time to time
by a written instrument signed by the Depositor which may increase or decrease
the number of Trustees; provided, however, that to the extent required by the
Business Trust Act, one Trustee shall either be a natural person who is a
resident of the State of Delaware or, if not a natural person, an entity which
has its principal place of business in the State of Delaware and otherwise meets
the requirements of applicable Delaware law. Subject to the foregoing, the
Depositor is entitled to appoint or remove without cause any Trustee at any
time. The Trustees may resign upon thirty days prior notice to the Depositor.
7. This Trust Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws of principles).
3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed as of the day and year first above written.
PACIFIC GAS AND ELECTRIC COMPANY,
as Depositor
Gabriel B. Togneri
By: __________________________
Name: Gabriel B. Togneri
Title: Assistant Treasurer
THE FIRST NATIONAL BANK
OF CHICAGO, not in its
individual capacity but
solely as Trustee
John R. Prendiville
By: __________________________
Name: John R. Prendiville
Title: Vice President
Michael J. Majchrzak
not in his individual capacity
but solely as Trustee
Michael J. Majchrzak
_________________________
Gabriel B. Togneri
not in his individual capacity
but solely as Trustee
Gabriel B. Togneri
_________________________
4
<PAGE>
Leslie Guliasi
not in his individual capacity
but solely as Trustee
Leslie Guliasi
_________________________
Alan H. Lindstrom
not in his individual capacity
but solely as Trustee
Alan H. Lindstrom
_________________________
5
<PAGE>
Exhibit 3-6
TRUST AGREEMENT
---------------
This TRUST AGREEMENT, dated as of August 14, 1995, among Pacific Gas
and Electric Company, a California corporation, as "Depositor," The First
National Bank of Chicago, a banking association organized under the laws of the
United States, Michael J. Majchrzak, Gabriel B. Togneri, Leslie Guliasi and Alan
H. Lindstrom, not in their individual capacities but solely as Trustees. The
Depositor and the Trustees hereby agree as follows:
1. The trust created hereby shall be known as "PG&E Capital II," in
which name the Trustees, or the Depositor to the extent provided herein, may
conduct the business of the Trust, make and execute contracts, and sue and be
sued.
2. The Depositor hereby assigns, transfers, conveys and sets over to
the Trustees the sum of $10. The Trustees hereby acknowledge receipt of such
amount in trust from the Depositor, which amount shall constitute the initial
trust estate. The Trustees hereby declare that they will hold the trust estate
in trust for the Depositor. It is the intention of the parties hereto that the
Trust created hereby constitute a business trust under Chapter 38 of Title 12 of
the Delaware Code, 12 Del. C. (S) 3801 et seq. (the "Business Trust Act"), and
------- -- ---
that this document constitutes the governing instrument of the Trust. The
Trustees are hereby authorized and directed to execute and file a certificate of
trust with the Delaware Secretary of State in accordance with the provisions of
the Business Trust Act.
3. The Depositor and the Trustees will enter into an amended and
restated Trust Agreement, satisfactory to each such party and substantially in
the form included as Exhibit 4.1 to the 1933 Act Registration Statement referred
to below, to provide for the contemplated operation of the Trust created hereby
and the issuance of the Preferred Securities and Common Securities referred to
therein. Prior to the execution and delivery of such amended and restated Trust
Agreement, the Trustees shall not have any duty or obligation hereunder or with
respect to the trust estate, except as otherwise required by applicable law or
as may be necessary to obtain prior to such execution and delivery of any
licenses, consents or approvals required by applicable law or otherwise.
4. The Depositor and the Trustees hereby authorize and direct the
Depositor, as the sponsor of the
<PAGE>
Trust, (i) to file with the Securities and Exchange Commission (the
"Commission") and execute, in each case on behalf of the Trust, (a) the
Registration Statement on Form S-3 and S-4 (the "1933 Act Registration
Statement"), including any pre-effective or post-effective amendments to such
1933 Act Registration Statement (including the prospectus and the exhibits
contained therein), relating to the registration under the Securities Act of
1933, as amended, of the Preferred Securities of the Trust and certain other
securities and (b) a Registration Statement on Form 8-A (the "1934 Act
Registration Statement") (including all pre-effective and post-effective
amendments thereto) relating to the registration of the Preferred Securities of
the Trust under Section 12(b) of the Securities Exchange Act of 1934, as
amended; (ii) to file with the New York, American or Pacific Stock Exchange
(each an "Exchange") and execute on behalf of the Trust one or more listing
applications and all other applications, statements, certificates, agreements
and other instruments as shall be necessary or desirable to cause the Preferred
Securities to be listed on any of the Exchanges; (iii) to file and execute on
behalf of the Trust such applications, reports, surety bonds, irrevocable
consents, appointments of attorney for service of process and other papers and
documents as shall be necessary or desirable to register the Preferred
Securities under the securities or "Blue Sky" laws of such jurisdictions as the
Depositor, on behalf of the Trust, may deem necessary or desirable and (iv) to
execute on behalf of the Trust that certain Underwriting Agreement relating to
the Preferred Securities, among the Trust, the Depositor and the several
Underwriters named therein, substantially in the form included as Exhibit 1 to
the 1933 Act Registration Statement. In the event that any filing referred to in
clauses (i), (ii) and (iii) above is required by the rules and regulations of
the Commission, the Exchange or state securities or blue sky laws, to be
executed on behalf of the Trust by any of the Trustees, each of Gabriel B.
Togneri, Leslie Guliasi and Alan H. Lindstrom, in their capacities as Trustees
of the Trust, is hereby authorized and directed to join in any such filing and
to execute on behalf of the Trust any and all of the foregoing. In connection
with all of the foregoing, the Depositor hereby constitutes and appoints Gabriel
B. Togneri, Gary P. Encinas, Julie C. Gavin and Grace U. Shin, and each of them,
as its true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for the Depositor or in the Depositor's name,
place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to the 1933 Act Registration Statement and
the 1934 Act Registration Statement and to file the same, with all exhibits
thereto, and other documents in
2
<PAGE>
connection therewith, with the Commission, granting unto said attorneys-in-fact
and agents full power and authority to do and perform each and every act and
thing requisite and necessary to be done in connection therewith, as fully to
all intents and purposes as the Depositor might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents or any of
them, or their respective substitute or substitutes, shall do or cause to be
done by virtue hereof.
5. This Trust Agreement may be executed in one or more counterparts.
6. The number of Trustees initially shall be five (5) and thereafter
the number of Trustees shall be such number as shall be fixed from time to time
by a written instrument signed by the Depositor which may increase or decrease
the number of Trustees; provided, however, that to the extent required by the
Business Trust Act, one Trustee shall either be a natural person who is a
resident of the State of Delaware or, if not a natural person, an entity which
has its principal place of business in the State of Delaware and otherwise meets
the requirements of applicable Delaware law. Subject to the foregoing, the
Depositor is entitled to appoint or remove without cause any Trustee at any
time. The Trustees may resign upon thirty days prior notice to the Depositor.
7. This Trust Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws of principles).
3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed as of the day and year first above written.
PACIFIC GAS AND ELECTRIC COMPANY,
as Depositor
Gabriel B. Togneri
By: __________________________
Name: Gabriel B. Togneri
Title: Assistant Treasurer
THE FIRST NATIONAL BANK
OF CHICAGO, not in its
individual capacity but
solely as Trustee
John R. Prendiville
By: __________________________
Name: John R. Prendiville
Title: Vice President
Michael J. Majchrzak
not in his individual capacity
but solely as Trustee
Michael J. Majchrzak
_________________________
Gabriel B. Togneri
not in his individual capacity
but solely as Trustee
Gabriel B. Togneri
_________________________
4
<PAGE>
Leslie Guliasi
not in his individual capacity
but solely as Trustee
Leslie Guliasi
_________________________
Alan H. Lindstrom
not in his individual capacity
but solely as Trustee
Alan H. Lindstrom
_________________________
5
<PAGE>
Exhibit 3-7
TRUST AGREEMENT
---------------
This TRUST AGREEMENT, dated as of August 14, 1995, among Pacific Gas
and Electric Company, a California corporation, as "Depositor," The First
National Bank of Chicago, a banking association organized under the laws of the
United States, Michael J. Majchrzak, Gabriel B. Togneri, Leslie Guliasi and Alan
H. Lindstrom, not in their individual capacities but solely as Trustees. The
Depositor and the Trustees hereby agree as follows:
1. The trust created hereby shall be known as "PG&E Capital III," in
which name the Trustees, or the Depositor to the extent provided herein, may
conduct the business of the Trust, make and execute contracts, and sue and be
sued.
2. The Depositor hereby assigns, transfers, conveys and sets over to
the Trustees the sum of $10. The Trustees hereby acknowledge receipt of such
amount in trust from the Depositor, which amount shall constitute the initial
trust estate. The Trustees hereby declare that they will hold the trust estate
in trust for the Depositor. It is the intention of the parties hereto that the
Trust created hereby constitute a business trust under Chapter 38 of Title 12 of
the Delaware Code, 12 Del. C. (S) 3801 et seq. (the "Business Trust Act"), and
------- -- ---
that this document constitutes the governing instrument of the Trust. The
Trustees are hereby authorized and directed to execute and file a certificate of
trust with the Delaware Secretary of State in accordance with the provisions of
the Business Trust Act.
3. The Depositor and the Trustees will enter into an amended and
restated Trust Agreement, satisfactory to each such party and substantially in
the form included as Exhibit 4.1 to the 1933 Act Registration Statement referred
to below, to provide for the contemplated operation of the Trust created hereby
and the issuance of the Preferred Securities and Common Securities referred to
therein. Prior to the execution and delivery of such amended and restated Trust
Agreement, the Trustees shall not have any duty or obligation hereunder or with
respect to the trust estate, except as otherwise required by applicable law or
as may be necessary to obtain prior to such execution and delivery of any
licenses, consents or approvals required by applicable law or otherwise.
4. The Depositor and the Trustees hereby authorize and direct the
Depositor, as the sponsor of the
<PAGE>
Trust, (i) to file with the Securities and Exchange Commission (the
"Commission") and execute, in each case on behalf of the Trust, (a) the
Registration Statement on Form S-3 and S-4 (the "1933 Act Registration
Statement"), including any pre-effective or post-effective amendments to such
1933 Act Registration Statement (including the prospectus and the exhibits
contained therein), relating to the registration under the Securities Act of
1933, as amended, of the Preferred Securities of the Trust and certain other
securities and (b) a Registration Statement on Form 8-A (the "1934 Act
Registration Statement") (including all pre-effective and post-effective
amendments thereto) relating to the registration of the Preferred Securities of
the Trust under Section 12(b) of the Securities Exchange Act of 1934, as
amended; (ii) to file with the New York, American or Pacific Stock Exchange
(each an "Exchange") and execute on behalf of the Trust one or more listing
applications and all other applications, statements, certificates, agreements
and other instruments as shall be necessary or desirable to cause the Preferred
Securities to be listed on any of the Exchanges; (iii) to file and execute on
behalf of the Trust such applications, reports, surety bonds, irrevocable
consents, appointments of attorney for service of process and other papers and
documents as shall be necessary or desirable to register the Preferred
Securities under the securities or "Blue Sky" laws of such jurisdictions as the
Depositor, on behalf of the Trust, may deem necessary or desirable and (iv) to
execute on behalf of the Trust that certain Underwriting Agreement relating to
the Preferred Securities, among the Trust, the Depositor and the several
Underwriters named therein, substantially in the form included as Exhibit 1 to
the 1933 Act Registration Statement. In the event that any filing referred to in
clauses (i), (ii) and (iii) above is required by the rules and regulations of
the Commission, the Exchange or state securities or blue sky laws, to be
executed on behalf of the Trust by any of the Trustees, each of Gabriel B.
Togneri, Leslie Guliasi and Alan H. Lindstrom, in their capacities as Trustees
of the Trust, is hereby authorized and directed to join in any such filing and
to execute on behalf of the Trust any and all of the foregoing. In connection
with all of the foregoing, the Depositor hereby constitutes and appoints Gabriel
B. Togneri, Gary P. Encinas, Julie C. Gavin and Grace U. Shin, and each of them,
as its true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for the Depositor or in the Depositor's name,
place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to the 1933 Act Registration Statement and
the 1934 Act Registration Statement and to file the same, with all exhibits
thereto, and other documents in
2
<PAGE>
connection therewith, with the Commission, granting unto said attorneys-in-fact
and agents full power and authority to do and perform each and every act and
thing requisite and necessary to be done in connection therewith, as fully to
all intents and purposes as the Depositor might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents or any of
them, or their respective substitute or substitutes, shall do or cause to be
done by virtue hereof.
5. This Trust Agreement may be executed in one or more counterparts.
6. The number of Trustees initially shall be five (5) and thereafter
the number of Trustees shall be such number as shall be fixed from time to time
by a written instrument signed by the Depositor which may increase or decrease
the number of Trustees; provided, however, that to the extent required by the
Business Trust Act, one Trustee shall either be a natural person who is a
resident of the State of Delaware or, if not a natural person, an entity which
has its principal place of business in the State of Delaware and otherwise meets
the requirements of applicable Delaware law. Subject to the foregoing, the
Depositor is entitled to appoint or remove without cause any Trustee at any
time. The Trustees may resign upon thirty days prior notice to the Depositor.
7. This Trust Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws of principles).
3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed as of the day and year first above written.
PACIFIC GAS AND ELECTRIC COMPANY,
as Depositor
Gabriel B. Togneri
By: __________________________
Name: Gabriel B. Togneri
Title: Assistant Treasurer
THE FIRST NATIONAL BANK
OF CHICAGO, not in its
individual capacity but
solely as Trustee
John R. Prendiville
By: __________________________
Name: John R. Prendiville
Title: Vice President
Michael J. Majchrzak
not in his individual capacity
but solely as Trustee
Michael J. Majchrzak
_________________________
Gabriel B. Togneri
not in his individual capacity
but solely as Trustee
Gabriel B. Togneri
_________________________
4
<PAGE>
Leslie Guliasi
not in his individual capacity
but solely as Trustee
Leslie Guliasi
_________________________
Alan H. Lindstrom
not in his individual capacity
but solely as Trustee
Alan H. Lindstrom
_________________________
5
<PAGE>
Exhibit 3-8
TRUST AGREEMENT
---------------
This TRUST AGREEMENT, dated as of August 14, 1995, among Pacific Gas
and Electric Company, a California corporation, as "Depositor," The First
National Bank of Chicago, a banking association organized under the laws of the
United States, Michael J. Majchrzak, Gabriel B. Togneri, Leslie Guliasi and Alan
H. Lindstrom, not in their individual capacities but solely as Trustees. The
Depositor and the Trustees hereby agree as follows:
1. The trust created hereby shall be known as "PG&E Capital IV," in
which name the Trustees, or the Depositor to the extent provided herein, may
conduct the business of the Trust, make and execute contracts, and sue and be
sued.
2. The Depositor hereby assigns, transfers, conveys and sets over to
the Trustees the sum of $10. The Trustees hereby acknowledge receipt of such
amount in trust from the Depositor, which amount shall constitute the initial
trust estate. The Trustees hereby declare that they will hold the trust estate
in trust for the Depositor. It is the intention of the parties hereto that the
Trust created hereby constitute a business trust under Chapter 38 of Title 12 of
the Delaware Code, 12 Del. C. (S) 3801 et seq. (the "Business Trust Act"), and
------- -- ---
that this document constitutes the governing instrument of the Trust. The
Trustees are hereby authorized and directed to execute and file a certificate of
trust with the Delaware Secretary of State in accordance with the provisions of
the Business Trust Act.
3. The Depositor and the Trustees will enter into an amended and
restated Trust Agreement, satisfactory to each such party and substantially in
the form included as Exhibit 4.1 to the 1933 Act Registration Statement referred
to below, to provide for the contemplated operation of the Trust created hereby
and the issuance of the Preferred Securities and Common Securities referred to
therein. Prior to the execution and delivery of such amended and restated Trust
Agreement, the Trustees shall not have any duty or obligation hereunder or with
respect to the trust estate, except as otherwise required by applicable law or
as may be necessary to obtain prior to such execution and delivery of any
licenses, consents or approvals required by applicable law or otherwise.
4. The Depositor and the Trustees hereby authorize and direct the
Depositor, as the sponsor of the
<PAGE>
Trust, (i) to file with the Securities and Exchange Commission (the
"Commission") and execute, in each case on behalf of the Trust, (a) the
Registration Statement on Form S-3 and S-4 (the "1933 Act Registration
Statement"), including any pre-effective or post-effective amendments to such
1933 Act Registration Statement (including the prospectus and the exhibits
contained therein), relating to the registration under the Securities Act of
1933, as amended, of the Preferred Securities of the Trust and certain other
securities and (b) a Registration Statement on Form 8-A (the "1934 Act
Registration Statement") (including all pre-effective and post-effective
amendments thereto) relating to the registration of the Preferred Securities of
the Trust under Section 12(b) of the Securities Exchange Act of 1934, as
amended; (ii) to file with the New York, American or Pacific Stock Exchange
(each an "Exchange") and execute on behalf of the Trust one or more listing
applications and all other applications, statements, certificates, agreements
and other instruments as shall be necessary or desirable to cause the Preferred
Securities to be listed on any of the Exchanges; (iii) to file and execute on
behalf of the Trust such applications, reports, surety bonds, irrevocable
consents, appointments of attorney for service of process and other papers and
documents as shall be necessary or desirable to register the Preferred
Securities under the securities or "Blue Sky" laws of such jurisdictions as the
Depositor, on behalf of the Trust, may deem necessary or desirable and (iv) to
execute on behalf of the Trust that certain Underwriting Agreement relating to
the Preferred Securities, among the Trust, the Depositor and the several
Underwriters named therein, substantially in the form included as Exhibit 1 to
the 1933 Act Registration Statement. In the event that any filing referred to in
clauses (i), (ii) and (iii) above is required by the rules and regulations of
the Commission, the Exchange or state securities or blue sky laws, to be
executed on behalf of the Trust by any of the Trustees, each of Gabriel B.
Togneri, Leslie Guliasi and Alan H. Lindstrom, in their capacities as Trustees
of the Trust, is hereby authorized and directed to join in any such filing and
to execute on behalf of the Trust any and all of the foregoing. In connection
with all of the foregoing, the Depositor hereby constitutes and appoints Gabriel
B. Togneri, Gary P. Encinas, Julie C. Gavin and Grace U. Shin and each of
them, as its true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for the Depositor or in the Depositor's name,
place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to the 1933 Act Registration Statement and
the 1934 Act Registration Statement and to file the same, with all exhibits
thereto, and other documents in
2
<PAGE>
connection therewith, with the Commission, granting unto said attorneys-in-fact
and agents full power and authority to do and perform each and every act and
thing requisite and necessary to be done in connection therewith, as fully to
all intents and purposes as the Depositor might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents or any of
them, or their respective substitute or substitutes, shall do or cause to be
done by virtue hereof.
5. This Trust Agreement may be executed in one or more counterparts.
6. The number of Trustees initially shall be five (5) and thereafter
the number of Trustees shall be such number as shall be fixed from time to time
by a written instrument signed by the Depositor which may increase or decrease
the number of Trustees; provided, however, that to the extent required by the
Business Trust Act, one Trustee shall either be a natural person who is a
resident of the State of Delaware or, if not a natural person, an entity which
has its principal place of business in the State of Delaware and otherwise meets
the requirements of applicable Delaware law. Subject to the foregoing, the
Depositor is entitled to appoint or remove without cause any Trustee at any
time. The Trustees may resign upon thirty days prior notice to the Depositor.
7. This Trust Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws of principles).
3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed as of the day and year first above written.
PACIFIC GAS AND ELECTRIC COMPANY,
as Depositor
Gabriel B. Togneri
By: __________________________
Name: Gabriel B. Togneri
Title: Assistant Treasurer
THE FIRST NATIONAL BANK
OF CHICAGO, not in its
individual capacity but
solely as Trustee
John R. Prendiville
By: __________________________
Name: John R. Prendiville
Title: Vice President
Michael J. Majchrzak
not in his individual capacity
but solely as Trustee
Michael J. Majchrzak
_________________________
Gabriel B. Togneri
not in his individual capacity
but solely as Trustee
Gabriel B. Togneri
_________________________
4
<PAGE>
Leslie Guliasi
not in his individual capacity
but solely as Trustee
Leslie Guliasi
_________________________
Alan H. Lindstrom
not in his individual capacity
but solely as Trustee
Alan H. Lindstrom
_________________________
5
<PAGE>
Exhibit 3-9
================================================================================
AMENDED AND RESTATED
TRUST AGREEMENT
among
PACIFIC GAS AND ELECTRIC COMPANY, as Depositor,
THE FIRST NATIONAL BANK OF CHICAGO, as Property Trustee,
THE DELAWARE TRUSTEE NAMED HEREIN
and
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN
Dated as of _________ __, 1995
PG & E CAPITAL I
================================================================================
<PAGE>
PG&E Capital I
Certain Sections of this Trust Agreement relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
Trust Indenture Trust Agreement
Act Section Section
------------------ ----------------
<S> <C>
(S) 310(a)(1)................................................. 8.07
(a)(2)................................................. 8.07
(a)(3)................................................. 8.09
(a)(4)................................................. 2.07(a)(ii)
(b).................................................... 8.08
(S) 311(a).................................................... 8.13
(b).................................................... 8.13
(S) 312(a).................................................... 5.07
(b).................................................... 5.07
(c).................................................... 5.07
(S) 313(a).................................................... 8.14(a)
(a)(4)................................................. 8.14(b)
(b).................................................... 8.14(b)
(c).................................................... 10.08
(d).................................................... 8.14(c)
(S) 314(a).................................................... 8.15
(b).................................................... Not Applicable
(c)(1)................................................. 8.16
(c)(2)................................................. 8.16
(c)(3)................................................. Not Applicable
(d).................................................... Not Applicable
(e).................................................... 1.01, 8.16
(S) 315(a).................................................... 8.01(a), 8.03(a)
(b).................................................... 8.02, 10.08
(c).................................................... 8.01(a)
(d).................................................... 8.01, 8.03
(e).................................................... Not Applicable
(S) 316(a).................................................... Not Applicable
(a)(1)(A).............................................. Not Applicable
(a)(1)(B).............................................. Not Applicable
(a)(2)................................................. Not Applicable
(b).................................................... Not Applicable
(c).................................................... 6.07
(S) 317(a)(1)................................................. Not Applicable
(a)(2)................................................. Not Applicable
(b).................................................... 5.09
(S) 318(a).................................................... 10.10
</TABLE>
-------------
Note: This reconciliation and tie sheet shall not, for any purpose, be
deemed to be a part of the Trust Agreement.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE I
Defined Terms
Section 1.01. Definitions................................................. 1
ARTICLE II
Establishment of the Trust
Section 2.01. Name........................................................ 10
Section 2.02. Office of the Delaware Trustee; Principal Place of Business. 10
Section 2.03. Initial Contribution of Trust Property; Organizational
Expenses.................................................... 10
Section 2.04. Issuance of the Preferred Securities........................ 10
Section 2.05. Subscription and Purchase of Debentures; Issuance of the
Common Securities........................................... 11
Section 2.06. Declaration of Trust........................................ 11
Section 2.07. Authorization to Enter into Certain Transactions............ 12
Section 2.08. Assets of Trust............................................. 15
Section 2.09. Title to Trust Property..................................... 15
ARTICLE III
Payment Account
Section 3.01. Payment Account............................................. 15
ARTICLE IV
Distributions; Redemption
Section 4.01. Distributions............................................... 15
Section 4.02. Redemption.................................................. 16
Section 4.03. Subordination of Common Securities.......................... 18
Section 4.04. Payment Procedures.......................................... 19
Section 4.05. Tax Returns and Reports..................................... 19
ARTICLE V
Trust Securities Certificates
</TABLE>
-i-
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
Section 5.01. Initial Ownership........................................... 19
Section 5.02. The Trust Securities Certificates........................... 19
Section 5.03. Delivery of Trust Securities Certificates................... 20
Section 5.04. Registration of Transfer and Exchange of Preferred
Securities Certificates..................................... 20
Section 5.05. Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates................................................ 21
Section 5.06. Persons Deemed Securityholders.............................. 21
Section 5.07. Access to List of Securityholders' Names and Addresses...... 21
Section 5.08. Maintenance of Office or Agency............................. 22
Section 5.09. Appointment of Paying Agent................................. 22
Section 5.10. Ownership of Common Securities by Depositor................. 22
Section 5.11. Book-Entry Preferred Securities Certificates; Common
Securities Certificate...................................... 22
Section 5.12. Notices to Clearing Agency.................................. 23
Section 5.13. Definitive Preferred Securities Certificates................ 23
Section 5.14. Rights of Securityholders................................... 24
ARTICLE VI
Acts of Securityholders; Meetings; Voting
Section 6.01. Limitations on Voting Rights................................ 24
Section 6.02. Notice of Meetings.......................................... 25
Section 6.03. Meetings of Preferred Securityholders....................... 25
Section 6.04. Voting Rights............................................... 26
Section 6.05. Proxies, etc. .............................................. 26
Section 6.06. Securityholder Action by Written Consent.................... 26
Section 6.07. Record Date for Voting and Other Purposes................... 26
Section 6.08. Acts of Securityholders..................................... 27
Section 6.09. Inspection of Records....................................... 28
ARTICLE VII
Representations and Warranties
Section 7.01. Representations and Warranties of the Bank, the Property
Trustee and the Delaware Trustee............................ 28
ARTICLE VIII
The Trustees
</TABLE>
-ii-
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
Section 8.01. Certain Duties and Responsibilities......................... 29
Section 8.02. Notice of Defaults.......................................... 30
Section 8.03. Certain Rights of Property Trustee.......................... 30
Section 8.04. Not Responsible for Recitals or Issuance of Securities...... 31
Section 8.05. May Hold Securities......................................... 32
Section 8.06. Compensation; Indemnity; Fees............................... 32
Section 8.07. Corporate Property Trustee Required; Eligibility of Trustees 32
Section 8.08. Conflicting Interests....................................... 33
Section 8.09. Co-Trustees and Separate Trustee............................ 33
Section 8.10. Resignation and Removal; Appointment of Successor........... 34
Section 8.11. Acceptance of Appointment by Successor...................... 36
Section 8.12. Merger, Conversion, Consolidation or Succession to Business. 37
Section 8.13. Preferential Collection of Claims Against Depositor or Trust 37
Section 8.14. Reports by Property Trustee................................. 37
Section 8.15. Reports to the Property Trustee............................. 38
Section 8.16. Evidence of Compliance with Conditions Precedent............ 38
Section 8.17. Number of Trustees.......................................... 38
Section 8.18. Delegation of Power......................................... 38
ARTICLE IX
Termination and Liquidation
Section 9.01. Termination Upon Expiration Date............................ 39
Section 9.02. Early Termination........................................... 39
Section 9.03. Termination................................................. 39
Section 9.04. Liquidation................................................. 39
ARTICLE X
Miscellaneous Provisions
Section 10.01. Limitation of Rights of Securityholders..................... 41
Section 10.02. Amendment................................................... 41
Section 10.03. Separability................................................ 42
Section 10.04. Governing Law............................................... 42
Section 10.05. Payments Due on Non-Business Day............................ 42
Section 10.06. Successors.................................................. 42
Section 10.07. Headings.................................................... 43
Section 10.08. Reports, Notices and Demands................................ 43
Section 10.09. Agreement Not to Petition................................... 43
Section 10.10. Trust Indenture Act; Conflict with Trust Indenture Act...... 44
Section 10.11. Acceptance of Terms of Trust Agreement, Guarantee and
Indenture................................................... 44
</TABLE>
-iii-
<PAGE>
Exhibit A Certificate of Trust
Exhibit B Form of Certificate Depository Agreement
Exhibit C Form of Common Securities Certificate
Exhibit D Form of Expense Agreement
Exhibit E Form of Preferred Securities Certificate
-iv-
<PAGE>
AMENDED AND RESTATED TRUST AGREEMENT, dated as of ___________ __,
1995, among (i) Pacific Gas and Electric Company, a California corporation (the
"Depositor"), (ii) The First National Bank of Chicago, a national banking
association duly organized and existing under the laws of the United States, as
trustee (the "Property Trustee" and, in its separate corporate capacity and not
in its capacity as Trustee, the "Bank"), (iii) Michael J. Majchrzak, an
individual, as Delaware trustee (the "Delaware Trustee"), (iv) Gabriel B.
Togneri, an individual, Leslie Guliasi, an individual and Alan H. Lindstrom, an
individual, each of whose address is c/o Pacific Gas and Electric Company, 77
Beale Street, P.O. Box 770000, San Francisco, California 94120 (each an
"Administrative Trustee" and collectively the "Administrative Trustees") (the
Property Trustee, the Delaware Trustee and the Administrative Trustees referred
to collectively as the "Trustees") and (v) the several Holders, as hereinafter
defined.
WITNESSETH:
----------
WHEREAS, the Depositor, the Bank, the Delaware Trustee and the
Administrative Trustees have heretofore duly declared and established a business
trust pursuant to the Delaware Business Trust Act by the entering into of that
certain Trust Agreement, dated as of August 14, 1995 (the "Original Trust
Agreement"), and by the execution and filing by the Property Trustee, the
Delaware Trustee and the Administrative Trustees with the Secretary of State of
the State of Delaware of the Certificate of Trust, filed on August __, 1995,
attached as Exhibit A; and
WHEREAS, the Depositor, the Bank, the Delaware Trustee and the
Administrative Trustees desire to amend and restate the Original Trust Agreement
in its entirety as set forth herein to provide for, among other things, (i) the
issuance of the Common Securities by the Trust to the Depositor, (ii) the
issuance and sale of the Preferred Securities by the Trust pursuant to the
Underwriting Agreement and (iii) the acquisition by the Trust from the Depositor
of all of the right, title and interest in the Debentures;
NOW THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, each party, for the benefit of the other party and
for the benefit of the Securityholders, hereby amends and restates the Original
Trust Agreement in its entirety and agrees as follows:
ARTICLE I
Defined Terms
Section 1.01. Definitions. For all purposes of this Trust Agreement,
-----------
except as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
<PAGE>
(b) all other terms used herein that are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(c) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may
be, of this Trust Agreement; and
(d) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.08.
---
"Additional Amount" means, with respect to Trust Securities of a given
-----------------
Liquidation Amount and/or a given period, the amount of Additional Interest (as
defined in the Indenture) paid by the Depositor on a Like Amount of Debentures
for such period.
"Administrative Trustee" means each of the individuals identified as
----------------------
an "Administrative Trustee" in the preamble to this Trust Agreement, solely in
his capacity as Administrative Trustee of the Trust formed and continued
hereunder and not in his individual capacity, or such Administrative Trustee's
successor in interest in such capacity, or any successor trustee appointed as
herein provided.
"Affiliate" of any specified Person means any other Person directly or
---------
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Bank" has the meaning specified in the preamble to this Trust
----
Agreement.
"Bankruptcy Event" means, with respect to any Person:
----------------
(a) the entry of a decree or order by a court having jurisdiction in
the premises judging such Person a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjudication
or composition of or in respect of such Person under Federal bankruptcy law
or any other applicable Federal or State law, or appointing a receiver,
liquidator, assignee, trustee, sequestrator or other similar official of
such Person or of any substantial part of its property, or ordering the
winding up or liquidation of its affairs, and the continuance of any such
decree or order unstayed and in effect for a period of 60 consecutive days;
or
(b) the institution by such Person of proceedings to be adjudicated a
bankrupt or insolvent, or of the consent by it to the institution of
bankruptcy or insolvency proceedings against it, or the filing by it of a
petition or answer or consent seeking
2
<PAGE>
reorganization or relief under Federal bankruptcy law or any other
applicable Federal or State law, or the consent by it to the filing of such
petition or to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator or similar official of such Person or of any
substantial part of its property, or the making by it of an assignment for
the benefit of creditors, or the admission by it in writing of its
inability to pay its debts generally as they become due, or the taking of
action by such Person in furtherance of any such action.
"Bankruptcy Laws" has the meaning specified in Section 10.09.
---------------
"Board Resolution" means a copy of a resolution certified by the
----------------
Secretary or an Assistant Secretary of the Depositor to have been duly adopted
by the Depositor's Board of Directors or a duly authorized committee thereof and
to be in full force and effect on the date of such certification, and delivered
to the Trustee.
"Book Entry Preferred Securities Certificates" means a beneficial
--------------------------------------------
interest in the Preferred Securities Certificates, ownership and transfers of
which shall be made through book entries by a Clearing Agency as described in
Section 5.11.
"Business Day" means a day other than (a) a Saturday or Sunday, (b) a
------------
day on which banking institutions in The City of New York are authorized or
obligated by law or executive order to remain closed, or (c) a day on which the
Property Trustee's Corporate Trust Office is closed for business.
"Certificate Depository Agreement" means the agreement among the
--------------------------------
Trust, the Depositor and The Depository Trust Company, as the initial Clearing
Agency, dated as of the Closing Date, relating to the Trust Certificates,
substantially in the form attached as Exhibit B, as the same may be amended and
supplemented from time to time.
"Clearing Agency" means an organization registered as a "clearing
---------------
agency" pursuant to Section 17A of the Securities Exchange Act of 1934, as
amended. The Depository Trust Company will be the initial Clearing Agency.
"Clearing Agency Participant" means a broker, dealer, bank, other
---------------------------
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Date" means the First Time of Delivery as defined in the
------------
Underwriting Agreement, which date is also the date of execution and delivery of
this Trust Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
----
"Commission" means the Securities and Exchange Commission, as from
----------
time to time constituted, created under the Securities Exchange Act of 1934, as
amended, or, if at any time after the execution of this instrument such
Commission is not existing and
3
<PAGE>
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Common Security" means an undivided beneficial interest in the assets
---------------
of the Trust, having a Liquidation Amount of $25 and having the rights provided
therefor in this Trust Agreement, including the right to receive Distributions
and a Liquidation Distribution as provided herein.
"Common Securities Certificate" means a certificate evidencing
-----------------------------
ownership of Common Securities, substantially in the form attached as Exhibit C.
"Corporate Trust Office" means the principal office of the Property
----------------------
Trustee located in Chicago, Illinois.
"Debenture Event of Default" means an "Event of Default" as defined in
--------------------------
the Indenture.
"Debenture Redemption Date" means "Redemption Date" as defined in the
-------------------------
Indenture with respect to the Debentures.
"Debenture Trustee" means The First National Bank of Chicago, a
-----------------
banking national association organized under the laws of the United States.
"Debentures" means the $_______________ aggregate principal amount (or
----------
up to $_______________ aggregate principal amount if and to the extent the
overallotment option granted by the Trust to the purchasers of the Preferred
Securities is exercised) of the Parent's ___% Deferrable Interest Subordinated
Debentures, Series A, issued pursuant to the Indenture.
"Definitive Preferred Securities Certificates" means either or both
--------------------------------------------
(as the context requires) of (a) Preferred Securities Certificates issued in
certificated, fully registered form as provided in Section 5.11(a) and (b)
Preferred Securities Certificates issued in certificated, fully registered form
as provided in Section 5.13.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of the
---------------------------
Delaware Code, 12 Del. C. (S) 3801, et seq., as it may be amended from time to
-- ---
time.
"Delaware Trustee" means the individual identified as the "Delaware
----------------
Trustee" in the preamble to this Trust Agreement solely in his capacity as
Delaware Trustee of the Trust formed and continued hereunder and not in his
individual capacity, or his successor in interest in such capacity, or any
successor trustee appointed as herein provided.
"Depositor" has the meaning specified in the preamble to this Trust
---------
Agreement.
"Distribution Date" has the meaning specified in Section 4.01(a).
-----------------
4
<PAGE>
"Distributions" means amounts payable in respect of the Trust
-------------
Securities as provided in Section 4.01.
"Event of Default" means any one of the following events (whatever the
----------------
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the occurrence of a Debenture Event of Default; or
(b) default by the Property Trustee in the payment of any
Distribution when it becomes due and payable, and continuation of such
default for a period of 30 days; or
(c) default by the Property Trustee in the payment of any Redemption
Price of any Trust Security when it becomes due and payable; or
(d) default in the performance, or breach, in any material respect,
of any covenant or warranty of the Trustees in this Trust Agreement (other
than a covenant or warranty a default in whose performance or breach is
dealt with in clause (b) or (c), above) and continuation of such default or
breach for a period of 60 days after there has been given, by registered or
certified mail, to the defaulting Trustee or Trustees by the Holders of at
least 10% in Liquidation Amount of the Outstanding Preferred Securities a
written notice specifying such default or breach and requiring it to be
remedied and stating that such notice is a "Notice of Default" hereunder;
or
(e) the occurrence of a Bankruptcy Event with respect to the Property
Trustee and Pacific Gas and Electric Company fails to appoint a successor
Property Trustee within 60 days thereof.
"Expense Agreement" means the Agreement as to Expenses and Liabilities
-----------------
between the Depositor and the Trust, substantially in the form attached as
Exhibit D, as amended from time to time.
"Guarantee" means the Guarantee Agreement executed and delivered by
---------
the Parent and The First National Bank of Chicago, a national banking
association, as trustee, contemporaneously with the execution and delivery of
this Trust Agreement, for the benefit of the holders of the Preferred
Securities, as amended from time to time.
"Grantor Trust Event" has the meaning specified in Section 9.02(b).
"Indenture" means the Indenture, dated as of _________ ___, 1995, as
---------
supplemented by the First Supplemental Indenture, dated as of __________, 1995,
between the Parent and the Debenture Trustee, as trustee, as amended or
supplemented from time to time.
"Investment Company Event" means the occurrence of a change in law or
------------------------
regulation or a change in interpretation or application of law
5
<PAGE>
or regulation by any legislative body, court, governmental agency or regulatory
authority (a "Change in 1940 Act Law") to the effect that the Trust is or will
be considered an "investment company" that is required to be registered under
the 1940 Act, which Change in 1940 Act Law becomes effective on or after the
date of this Trust Agreement.
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of
----
trust, adverse ownership interest, hypothecation, assignment, security interest
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
"Like Amount" means (a) with respect to a redemption of Trust
-----------
Securities, Trust Securities having a Liquidation Amount equal to the principal
amount of Debentures to be contemporaneously redeemed in accordance with the
Indenture and the proceeds of which will be used to pay the Redemption Price of
such Trust Securities, and (b) with respect to a distribution to Holders of
Trust Securities of Debentures in connection with a termination or liquidation
of the Trust, Debentures having a principal amount equal to the Liquidation
Amount of the Trust Securities of the Holder to whom such Debentures are
distributed.
"Liquidation Amount" means the stated amount of $25 per Trust
------------------
Security.
"Liquidation Date" means each Date on which Debentures are to be
----------------
distributed to Holders of Trust Securities in connection with a termination and
liquidation of the Trust pursuant to Section 9.04(a).
"Liquidation Distribution" has the meaning specified in Section
------------------------
9.04(d).
"1940 Act" means the Investment Company Act of 1940, as amended.
--------
"Officers' Certificate" means a certificate signed by the Chairman of
---------------------
the Board, a Vice Chairman of the Board, the President, a Senior Vice President
or a Vice President, and by the Treasurer, an Assistant Treasurer, the Secretary
or an Assistant Secretary, of the Depositor, and delivered to the appropriate
Trustee. One of the officers signing an Officers' Certificate given pursuant to
Section 8.16 shall be the principal executive, financial or accounting officer
of the Depositor. Any Officers' Certificate delivered with respect to
compliance with a condition or covenant provided for in this Trust Agreement
shall include:
(a) a statement that each officer signing the Officers' Certificate
has read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers'
Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
6
<PAGE>
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be
------------------
counsel for the Trust, the Property Trustee or the Depositor, but not an
employee of any thereof, and who shall be acceptable to the Property Trustee.
"Original Trust Agreement" has the meaning specified in the recitals
------------------------
to this Trust Agreement.
"Outstanding", when used with respect to Preferred Securities, means,
-----------
as of the date of determination, all Preferred Securities theretofore executed
and delivered under this Trust Agreement, except:
------
(a) Preferred Securities theretofore cancelled by the Administrative
Trustees or delivered to the Administrative Trustees for cancellation;
(b) Preferred Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Property Trustee
or any Paying Agent for the Holders of such Preferred Securities; provided
--------
that, if such Preferred Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this Trust Agreement; and
(c) Preferred Securities which have been paid or in exchange for or
in lieu of which other Preferred Securities have been executed and
delivered pursuant to Section 5.05;
provided, however, that in determining whether the Holders of the requisite
-------- -------
Liquidation Amount of the Outstanding Preferred Securities have given any
request, demand, authorization, direction, notice, consent or waiver hereunder,
Preferred Securities owned by the Depositor, any Trustee or any Affiliate of the
Depositor or any Trustee shall be disregarded and deemed not to be Outstanding,
except that (a) in determining whether any Trustee shall be protected in relying
upon any such request, demand, authorization, direction, notice, consent or
waiver, only Preferred Securities which such Trustee knows to be so owned shall
be so disregarded and (b) the foregoing shall not apply at any time when all of
the outstanding Preferred Securities are owned by the Depositor, one or more of
the Trustees and/or any such Affiliate. Preferred Securities so owned which
have been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Administrative Trustees the pledgee's
right so to act with respect to such Preferred Securities and that the pledgee
is not the Depositor or any Affiliate of the Depositor.
"Owner" means each Person who is the beneficial owner of a Book Entry
-----
Preferred Securities Certificate as reflected in the records of the Clearing
Agency or, if a Clearing Agency Participant is not the Owner, then as reflected
in the records of a Person maintaining an account with such Clearing Agency
(directly or indirectly, in accordance with the rules of such Clearing Agency).
7
<PAGE>
"Parent" has the meaning specified in the preamble to this Trust
------
Agreement.
"Paying Agent" means any paying agent or co-paying agent appointed
------------
pursuant to Section 5.09 and shall initially be the Bank.
"Payment Account" means a segregated non-interest-bearing corporate
---------------
trust account maintained by the Property Trustee with the Bank in its trust
department for the benefit of the Securityholders in which all amounts paid in
respect of the Debentures will be held and from which the Property Trustee shall
make payments to the Securityholders in accordance with Section 4.01.
"Person" means any individual, corporation, partnership, joint
------
venture, trust, limited liability company or corporation, unincorporated
organization or government or any agency or political subdivision thereof.
"Preferred Security" means an undivided beneficial interest in the
------------------
assets of the Trust, having a Liquidation Amount of $25 and having rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Preferred Securities Certificate" means a certificate evidencing
--------------------------------
ownership of Preferred Securities, substantially in the form attached as Exhibit
E.
"Property Trustee" means the commercial bank or trust company
----------------
identified as the "Property Trustee" in the preamble to this Trust Agreement
solely in its capacity as Property Trustee of the Trust heretofore formed and
continued hereunder and not in its individual capacity, or its successor in
interest in such capacity, or any successor property trustee appointed as herein
provided.
"Redemption Date" means, with respect to any Trust Security to be
---------------
redeemed, the date fixed for such redemption by or pursuant to this Trust
Agreement; provided that each Debenture Redemption Date and the stated maturity
--------
of the Debentures shall be a Redemption Date for a Like Amount of Trust
Securities.
"Redemption Price" means, with respect to any Trust Security, the
----------------
Liquidation Amount of such Trust Security, plus accumulated and unpaid
Distributions to the date of redemption, plus the amount of the premium, if any,
paid by the Depositor upon the concurrent redemption of a Like Amount of
Debentures.
"Relevant Trustee" shall have the meaning specified in Section 8.10.
----------------
"Securities Register" and "Securities Registrar" have the respective
------------------- --------------------
meanings specified in Section 5.04.
"Securityholder" or "Holder" means a Person in whose name a Trust
-------------- ------
Security or Securities is registered in the Securities Register; any such Person
shall be deemed to be a beneficial owner within the meaning of the Delaware
Business Trust Act.
8
<PAGE>
"Special Event" has the meaning specified in Section 9.02(b).
-------------
"Tax Event" means that the Depositor shall have received an Opinion of
---------
Counsel experienced in such matters to the effect that, as a result of any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein affecting taxation, or as a
result of any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or such pronouncement or decision is announced on or after the date of
this Trust Agreement, there is more than an insubstantial risk that (i) the
Trust is, or will be, subject to United States Federal income tax with respect
to interest received on the Debentures, (ii) interest payable by the Depositor
on the Debentures is not, or will not be, deductible for United States Federal
income tax purposes or (iii) the Trust is, or will be, subject to more than a de
minimis amount of other taxes, duties, assessments or other governmental
charges.
"Trust" means the Delaware business trust created and continued hereby
-----
and identified on the cover page to this Trust Agreement.
"Trust Agreement" means this Amended and Restated Trust Agreement, as
---------------
the same may be modified, amended or supplemented in accordance with the
applicable provisions hereof, including all exhibits hereto, including, for all
purposes of this Trust Agreement and any such modification, amendment or
supplement, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this Trust Agreement and any such modification, amendment or
supplement, respectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
-------------------
force at the date as of which this instrument was executed; provided, however,
-------- -------
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"Trust Property" means (a) the Debentures, (b) any cash on deposit in,
--------------
or owing to, the Payment Account and (c) all proceeds and rights in respect of
the foregoing and any other property and assets for the time being held or
deemed to be held by the Property Trustee pursuant to the trusts of this Trust
Agreement.
"Trust Security" means any one of the Common Securities or the
--------------
Preferred Securities.
"Trust Securities Certificate" means any one of the Common Securities
----------------------------
Certificates or the Preferred Securities Certificates.
"Underwriting Agreement" means the Underwriting Agreement, dated as of
----------------------
____________, 1995, among the Trust, the Depositor and the Underwriters named
therein.
9
<PAGE>
ARTICLE II
Establishment of the Trust
Section 2.01. Name. The Trust created and continued hereby shall be
----
known as "PG&E Capital I," as such name may be modified from time to time by the
Administrative Trustees following written notice to the Holders of Trust
Securities and the other Trustees, in which name the Trustees may conduct the
business of the Trust, make and execute contracts and other instruments on
behalf of the Trust and sue and be sued.
Section 2.02. Office of the Delaware Trustee; Principal Place of
--------------------------------------------------
Business. The address of the Delaware Trustee in the State of Delaware is c/o
--------
FCC National Bank, 300 King Street, Wilmington, Delaware 19801 or such other
address in the State of Delaware as the Delaware Trustee may designate by
written notice to the Securityholders and the Depositor. The principal place of
business of the Trust is c/o Pacific Gas and Electric Company, 77 Beale Street,
P.O. Box 770000, San Francisco, California 94177.
Section 2.03. Initial Contribution of Trust Property; Organizational
------------------------------------------------------
Expenses. The Property Trustee acknowledges receipt in trust from the Depositor
--------
in connection with the Original Trust Agreement of the sum of $10, which
constituted the initial Trust Property. The Depositor shall pay organizational
expenses of the Trust as they arise or shall, upon request of any Trustee,
promptly reimburse such Trustee for any such expenses paid by such Trustee. The
Depositor shall make no claim upon the Trust Property for the payment of such
expenses.
Section 2.04. Issuance of the Preferred Securities. On ________ __,
------------------------------------
1995 the Depositor, on behalf of the Trust and pursuant to the Original Trust
Agreement, executed and delivered the Underwriting Agreement. Contemporaneously
with the execution and delivery of this Trust Agreement, an Administrative
Trustee, on behalf of the Trust, shall execute in accordance with Section 5.02
and deliver to the Underwriters named therein Preferred Securities Certificates,
registered in the name of the nominee of the initial Clearing Agency, in an
aggregate amount of ________________ Preferred Securities having an aggregate
Liquidation Amount of $______________, against receipt of the aggregate purchase
price of such Preferred Securities of $___________, which amount the
Administrative Trustees shall promptly deliver to the Property Trustee. In the
event and to the extent the overallotment option granted by the Trust pursuant
to the Underwriting Agreement is exercised by such Underwriters, an
Administrative Trustee, on behalf of the Trust, shall execute in accordance with
Section 5.02 and deliver to such Underwriters Preferred Securities Certificates,
registered in the name of the nominee of the initial Clearing Agency, in an
aggregate amount of up to ________________ Preferred Securities having an
aggregate Liquidation Amount of up to $_______________, against receipt of the
aggregate purchase price of such Preferred Securities of up to $___________,
which amount the Administrative Trustees shall promptly deliver to the Property
Trustee, on the date specified pursuant to the Underwriting Agreement.
10
<PAGE>
Section 2.05. Subscription and Purchase of Debentures; Issuance of
----------------------------------------------------
the Common Securities. Contemporaneously with the execution and delivery of
---------------------
this Trust Agreement, the Administrative Trustees, on behalf of the Trust, shall
subscribe to and purchase from the Depositor Debentures, registered in the name
of the Trust and having an aggregate principal amount equal to $__________, and,
in satisfaction of the purchase price for such Debentures, the Property Trustee,
on behalf of the Trust, shall deliver to the Depositor the sum of $__________.
Contemporaneously therewith, an Administrative Trustee, on behalf of the Trust,
shall execute in accordance with Section 5.02 and deliver to the Depositor
Common Securities Certificates, registered in the name of the Depositor, in an
aggregate amount of ____________ Common Securities having an aggregate
Liquidation Amount of $_____________ against payment by the Depositor of the sum
of $___________. In the event the overallotment option granted by the Trust
with respect to the Preferred Securities pursuant to the Underwriting Agreement
is exercised by the Underwriters named therein, the Administrative Trustees, on
behalf of the Trust, in an aggregate principal amount (determined on a pro rata
basis to the extent the overallotment option is exercised) and contemporaneously
with the delivery to the Underwriters of such Preferred Securities, shall
subscribe to and purchase from the Depositor Debentures, registered in the name
of the Trust and having an aggregate principal amount up to $________, and, in
satisfaction of the purchase price for such Debentures, the Property Trustee, on
behalf of the Trust, shall deliver to the Depositor an amount equal to the
aggregate principal amount of Debentures being purchased. Contemporaneously
therewith, an Administrative Trustee, on behalf of the Trust, shall execute in
accordance with Section 5.02 and deliver to the Depositor Common Securities
Certificates, registered in the name of the Depositor, in an aggregate amount
(determined on a pro rata basis to the extent the overallotment option is
exercised) of up to _________ Common Securities having an aggregate Liquidation
Amount of up to $__________ against payment by the Depositor of an amount equal
to the aggregate Liquidation Amount of the Common Securities Certificates so
delivered.
Section 2.06. Declaration of Trust. The exclusive purposes and
--------------------
functions of the Trust are (a) to issue and sell Trust Securities and use the
proceeds from such sale to acquire the Debentures, and (b) to engage in those
activities necessary, convenient or incidental thereto. The Depositor hereby
appoints the Trustees as trustees of the Trust, to have all the rights, powers
and duties to the extent set forth herein, and the Trustees hereby accept such
appointment. The Property Trustee hereby declares that it will hold the Trust
Property in trust upon and subject to the conditions set forth herein for the
benefit of the Securityholders. The Administrative Trustees shall have all
rights, powers and duties set forth herein and in accordance with applicable law
with respect to accomplishing the purposes of the Trust. The Delaware Trustee
shall not be entitled to exercise any powers, nor shall the Delaware Trustee
have any of the duties and responsibilities, of the Property Trustee or the
Administrative Trustees set forth herein. The Delaware Trustee shall be one of
the Trustees of the Trust for the sole and limited purpose of fulfilling the
requirements of Section 3807 of the Delaware Business Trust Act.
11
<PAGE>
Section 2.07. Authorization to Enter into Certain Transactions.
------------------------------------------------
(a) The Trustees shall conduct the affairs of the Trust in accordance
with the terms of this Trust Agreement. Subject to the limitations set forth in
paragraph (b) of this Section, and in accordance with the following provisions
(i) and (ii), the Trustees shall have the authority to enter into all
transactions and agreements determined by the Trustees to be appropriate in
exercising the authority, express or implied, otherwise granted to the Trustees
under this Trust Agreement, and to perform all acts in furtherance thereof,
including without limitation, the following:
(i) As among the Trustees, each Administrative Trustee shall have the
power and authority to act on behalf of the Trust with respect to the
following matters:
(A) the issuance and sale of the Trust Securities;
(B) to cause the Trust to enter into, and to execute, deliver and
perform on behalf of the Trust, the Expense Agreement and the
Certificate Depository Agreement and such other agreements as may be
necessary or desirable in connection with the purposes and function of
the Trust;
(C) assisting in the registration of the Preferred Securities
under the Securities Act of 1933, as amended, and under state
securities or blue sky laws, and the qualification of this Trust
Agreement as a trust indenture under the Trust Indenture Act;
(D) assisting in the listing of the Preferred Securities upon
such securities exchange or exchanges as shall be determined by the
Depositor and the registration of the Preferred Securities under the
Securities Exchange Act of 1934, as amended, and the preparation and
filing of all periodic and other reports and other documents pursuant
to the foregoing;
(E) the appointment of a Paying Agent, authenticating agent and
Securities Registrar in accordance with this Trust Agreement;
(F) to the extent provided in this Trust Agreement, the winding
up of the affairs of and liquidation of the Trust and the preparation,
execution and filing of the certificate of cancellation with the
Secretary of State of the State of Delaware;
(G) unless otherwise determined by the Depositor, the Property
Trustee or the Administrative Trustees, or as otherwise required by
the Delaware Business Trust Act or the Trust Indenture Act, to execute
on behalf of the Trust (either acting alone or together with any or
all of the Administrative Trustees) any documents that the
Administrative Trustees have the power to execute pursuant to this
Trust Agreement; and
12
<PAGE>
(H) the taking of any action incidental to the foregoing as the
Trustees may from time to time determine is necessary or advisable to
give effect to the terms of this Trust Agreement for the benefit of
the Securityholders (without consideration of the effect of any such
action on any particular Securityholder).
(ii) As among the Trustees, the Property Trustee shall have the power,
duty and authority to act on behalf of the Trust with respect to the
following matters:
(A) the establishment of the Payment Account;
(B) the receipt of the Debentures;
(C) the collection of interest, principal and any other payments
made in respect of the Debentures in the Payment Account;
(D) the distribution of amounts owed to the Securityholders in
respect of the Trust Securities;
(E) the exercise of all of the rights, powers and privileges of a
holder of the Debentures;
(F) the sending of notices and other information regarding the
Trust Securities and the Debentures to the Securityholders in
accordance with this Trust Agreement;
(G) the distribution of the Trust Property in accordance with the
terms of this Trust Agreement;
(H) to the extent provided in this Trust Agreement, the winding
up of the affairs of and liquidation of the Trust and the preparation,
execution and filing of the certificate of cancellation with the
Secretary of State of the State of Delaware;
(I) after an Event of Default the taking of any action incidental
to the foregoing as the Property Trustee may from time to time
determine is necessary or advisable to give effect to the terms of
this Trust Agreement and protect and conserve the Trust Property for
the benefit of the Securityholders (without consideration of the
effect of any such action on any particular Securityholder); and
(J) registering transfers of the Trust Securities in accordance
with this Trust Agreement.
(b) So long as this Trust Agreement remains in effect, the Trust (or
the Trustees acting on behalf of the Trust) shall not undertake any business,
activities or transaction except as expressly provided herein or contemplated
hereby. In particular, the Trustees shall not (i) acquire any investments or
13
<PAGE>
engage in any activities not authorized by this Trust Agreement, (ii) sell,
assign, transfer, exchange, mortgage, pledge, set-off or otherwise dispose of
any of the Trust Property or interests therein, including to Securityholders,
except as expressly provided herein, (iii) take any action that would cause the
Trust to fail or cease to qualify as a "grantor trust" for federal income tax
purposes, (iv) incur any indebtedness for borrowed money or issue any other debt
or (v) take or consent to any action that would result in the placement of a
Lien on any of the Trust Property. The Administrative Trustees shall defend all
claims and demands of all Persons at any time claiming any Lien on any of the
Trust Property adverse to the interest of the Trust or the Securityholders in
their capacity as Securityholders.
(c) In connection with the issue and sale of the Preferred
Securities, the Depositor shall have the right and responsibility to assist the
Trust with respect to, or effect on behalf of the Trust, the following (and any
actions taken by the Depositor in furtherance of the following prior to the date
of this Trust Agreement are hereby ratified and confirmed in all respects):
(i) to prepare for filing by the Trust with the Commission and to
execute on behalf of the Trust a registration statement on Form S-3 or S-4
in relation to the Preferred Securities, including any amendments thereto;
(ii) to determine the States in which to take appropriate action to
qualify or register for sale all or part of the Preferred Securities and to
do any and all such acts, other than actions which must be taken by or on
behalf of the Trust, and advise the Trustees of actions they must take on
behalf of the Trust, and prepare for execution and filing any documents to
be executed and filed by the Trust or on behalf of the Trust, as the
Depositor deems necessary or advisable in order to comply with the
applicable laws of any such States;
(iii) to prepare for filing by the Trust and to execute on behalf
of the Trust an application to the New York Stock Exchange or any other
national stock exchange or the Nasdaq National Market for listing upon
notice of issuance of any Preferred Securities;
(iv) to prepare for filing by the Trust with the Commission and to
execute on behalf of the Trust a registration statement on Form 8-A
relating to the registration of the Preferred Securities under Section
12(b) or 12(g) of the Exchange Act, including any amendments thereto;
(v) to negotiate the terms of, and execute and deliver, the
Underwriting Agreement providing for the sale of the Preferred Securities;
and
(vi) any other actions necessary or desirable to carry out any of
the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the
Administrative Trustees are authorized and directed to conduct the affairs of
the Trust and to operate the Trust so that the Trust will not be deemed to be an
"investment company" required to be registered under the Investment Company Act
of 1940, as amended, or taxed as a corporation
14
<PAGE>
for United States federal income tax purposes and so that the Debentures will be
treated as indebtedness of the Depositor for United States federal income tax
purposes. In this connection, the Depositor and the Administrative Trustees are
authorized to take any action, not inconsistent with applicable law, the
Certificate of Trust or this Trust Agreement, that each of the Depositor and the
Administrative Trustees determines in their discretion to be necessary or
desirable for such purposes, as long as such action does not adversely affect in
any material respect the interests of the holders of the Preferred Securities.
Section 2.08. Assets of Trust. The assets of the Trust shall
---------------
consist of the Trust Property.
Section 2.09. Title to Trust Property. Legal title to all Trust
-----------------------
Property shall be vested at all times in the Property Trustee (in its capacity
as such) and shall be held and administered by the Property Trustee for the
benefit of the Securityholders in accordance with this Trust Agreement.
ARTICLE III
Payment Account
Section 3.01. Payment Account.
---------------
(a) On or prior to the Closing Date, the Property Trustee shall
establish the Payment Account. The Property Trustee and any agent of the
Property Trustee shall have exclusive control and sole right of withdrawal with
respect to the Payment Account for the purpose of making deposits in and
withdrawals from the Payment Account in accordance with this Trust Agreement.
All monies and other property deposited or held from time to time in the Payment
Account shall be held by the Property Trustee in the Payment Account for the
exclusive benefit of the Securityholders and for distribution as herein
provided, including (and subject to) any priority of payments provided for
herein.
(b) The Property Trustee shall deposit in the Payment Account,
promptly upon receipt, all payments of principal or interest on, and any other
payments or proceeds with respect to, the Debentures. Amounts held in the
Payment Account shall not be invested by the Property Trustee pending
distribution thereof.
ARTICLE IV
Distributions; Redemption
Section 4.01. Distributions.
-------------
(a) Distributions on the Trust Securities shall be cumulative, and
will accumulate whether or not there are funds of the Trust available for the
payment of Distributions. Distributions shall accrue from ____________, 1995,
and, except in the event that the
15
<PAGE>
Parent exercises its right to extend the interest payment period for the
Debentures pursuant to the Indenture, shall be payable quarterly in arrears on
March 31, June 30, September 30 and December 31 of each year, commencing on
_________ __, 1995. If any date on which Distributions are otherwise payable on
the Trust Securities is not a Business Day, then the payment of such
Distribution shall be made on the next succeeding day which is a Business Day
(and without any interest or other payment in respect of any such delay) except
that, if such Business Day is in the next succeeding calendar year, payment of
such Distribution shall be made on the immediately preceding Business Day, in
each case with the same force and effect as if made on such date (each date on
which distributions are payable in accordance with this Section 4.01(a) a
"Distribution Date").
(b) The Trust Securities represent undivided beneficial interests in
the Trust Property, and as a practical matter the Distributions on the Trust
Securities shall be payable at a rate of __% per annum of the Liquidation Amount
of the Trust Securities. The amount of Distributions payable for any full
quarterly period shall be computed on the basis of a 360-day year of twelve 30-
day months. If the interest payment period for the Debentures is extended
pursuant to the Indenture, then the rate per annum at which Distributions on the
Trust Securities accumulate shall be increased by an amount such that the
aggregate amount of Distributions that accumulate on all Trust Securities during
any such extended interest payment period is equal to the aggregate amount of
interest (including interest payable on unpaid interest at the percentage rate
per annum set forth above, compounded quarterly) that accrues during any such
extended interest payment period on the Debentures. The amount of Distributions
payable for any period shall include the Additional Amounts, if any.
(c) Distributions on the Trust Securities shall be made by the
Property Trustee from the Payment Account and shall be payable on each
Distribution Date only to the extent that the Trust has funds then on hand and
available in the Payment Account for the payment of such Distributions.
(d) Distributions on the Trust Securities with respect to a
Distribution Date shall be payable to the Holders thereof as they appear on the
Securities Register for the Trust Securities on the relevant record date, which
shall be one Business Day prior to such Distribution Date; provided, however,
-------- -------
that in the event that the Preferred Securities do not remain in book-entry-only
form, the relevant record date shall be the date 15 days prior to the relevant
Distribution Date.
Section 4.02. Redemption.
----------
(a) On each Debenture Redemption Date and the stated maturity of the
Debentures, the Trust will be required to redeem a Like Amount of Trust
Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee by
first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days
prior to the Redemption Date to each Holder of Trust Securities to be redeemed,
at such Holder's address appearing in the Security Register. All notices of
redemption shall state:
(i) the Redemption Date;
16
<PAGE>
(ii) the Redemption Price;
(iii) the CUSIP number;
(iv) if less than all the Outstanding Trust Securities are to be
redeemed, the identification and the total Liquidation Amount of the
particular Trust Securities to be redeemed; and
(v) that on the Redemption Date the Redemption Price will become
due and payable upon each such Trust Security to be redeemed and that
distributions thereon will cease to accrue on and after said date.
(c) The Trust Securities redeemed on each Redemption Date shall be
redeemed at the Redemption Price with the proceeds from the contemporaneous
redemption of Debentures. Redemptions of the Trust Securities shall be made and
the Redemption Price shall be payable on each Redemption Date only to the extent
that the Trust has funds then on hand and available in the Payment Account for
the payment of such Redemption Price.
(d) If the Property Trustee gives a notice of redemption in respect
of any Preferred Securities, then, by 12:00 noon, New York time, on the
Redemption Date, subject to Section 4.02(c), the Property Trustee will, so long
as the Preferred Securities are in book-entry-only form, irrevocably deposit
with the Clearing Agency for the Preferred Securities funds sufficient to pay
the applicable Redemption Price and will give such Clearing Agency irrevocable
instructions and authority to pay the Redemption Price to the holders thereof.
If the Preferred Securities are no longer in book-entry-only form, the Property
Trustee, subject to Section 4.02(c), will irrevocably deposit with the Paying
Agent funds sufficient to pay the applicable Redemption Price and will give the
Paying Agent irrevocable instructions and authority to pay the Redemption Price
to the holders thereof upon surrender of their Preferred Securities
Certificates. Notwithstanding the foregoing, Distributions payable on or prior
to the redemption date for any Trust Securities called for redemption shall be
payable to the Holders of such Trust Securities as they appear on the Register
for the Trust Securities on the relevant record dates for the related
Distribution Dates. If notice of redemption shall have been given and funds
deposited as required, then upon the date of such deposit, all rights of
Securityholders holding Trust Securities so called for redemption will cease,
except the right of such Securityholders to receive the Redemption Price, but
without interest, and such Securities will cease to be outstanding. In the
event that any date on which any Redemption Price is payable is not a Business
Day, then payment of the Redemption Price payable on such date will be made on
the next succeeding day which is a Business Day (and without any interest or
other payment in respect of any such delay), except that, if such Business Day
falls in the next calendar year, such payment will be made on the immediately
preceding Business Day, in each case, with the same force and effect as if made
on such date. In the event that payment of the Redemption Price in respect of
any Trust Securities called for redemption is improperly withheld or refused and
not paid either by the Trust or by the Depositor pursuant to the Guarantee,
Distributions on such Trust Securities will continue to accrue, at the then
applicable rate, from the Redemption Date originally established by the Trust
for such Trust Securities to the date such Redemption Price is actually paid, in
which case the actual
17
<PAGE>
payment date will be the date fixed for redemption for purposes of calculating
the Redemption Price.
(e) Payment of the Redemption Price on the Trust Securities shall be
made to the recordholders thereof as they appear on the Securities Register for
the Trust Securities on the relevant record date, which shall be one Business
Day prior to the relevant Redemption Date; provided, however, that in the event
-------- -------
that the Preferred Securities do not remain in book-entry-only form, the
relevant record date shall be the fifteenth day prior to the Redemption Date.
(f) If less than all the Outstanding Trust Securities are to be
redeemed on a Redemption Date, then the aggregate Liquidation Amount of Trust
Securities to be redeemed shall be allocated 3% to the Common Securities and 97%
to the Preferred Securities. The particular Preferred Securities to be redeemed
shall be selected not more than 60 days prior to the Redemption Date by the
Property Trustee from the Outstanding Preferred Securities not previously called
for redemption, by such method as the Property Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $25 or an integral multiple thereof) of the Liquidation Amount of
Preferred Securities of a denomination larger than $25. The Property Trustee
shall promptly notify the Security Registrar in writing of the Preferred
Securities selected for redemption and, in the case of any Preferred Securities
selected for partial redemption, the Liquidation Amount thereof to be redeemed.
For all purposes of this Trust Agreement, unless the context otherwise requires,
all provisions relating to the redemption of Preferred Securities shall relate,
in the case of any Preferred Securities redeemed or to be redeemed only in part,
to the portion of the Liquidation Amount of Preferred Securities which has been
or is to be redeemed.
Section 4.03. Subordination of Common Securities.
----------------------------------
(a) Payment of Distributions (including Additional Amounts, if
applicable) on, and the Redemption Price of, the Trust Securities, as
applicable, shall be made pro rata based on the Liquidation Amount of the Trust
--- ----
Securities; provided, however, that if on any Distribution Date or Redemption
-------- -------
Date a Debenture Event of Default shall have occurred and be continuing, no
payment of any Distribution (including Additional Amounts, if applicable) on, or
Redemption Price of, any Common Security, and no other payment on account of the
redemption, liquidation or other acquisition of Common Securities, shall be made
unless payment in full in cash of all accumulated and unpaid Distributions
(including Additional Amounts, if applicable) on all Outstanding Preferred
Securities for all distribution periods terminating on or prior thereto, or in
the case of payment of the Redemption Price the full amount of such Redemption
Price on all Outstanding Preferred Securities, shall have been made or provided
for, and all funds immediately available to the Property Trustee shall first be
applied to the payment in full in cash of all Distributions (including
Additional Amounts, if applicable) on, or Redemption Price of, Preferred
Securities then due and payable.
(b) In the case of the occurrence of any Debenture Event of Default,
the Holder of Common Securities will be deemed to have waived any right to act
with respect to any such Event of Default under this Trust Agreement until the
effect of all such Events of Default with respect to the Preferred Securities
have been cured, waived or otherwise
18
<PAGE>
eliminated. Until any such Event of Default under this Trust Agreement with
respect to the Preferred Securities have been so cured, waived or otherwise
eliminated, the Property Trustee shall act solely on behalf of the Holders of
the Preferred Securities and not the Holder of the Common Securities, and only
the Holders of the Preferred Securities will have the right to direct the
Property Trustee to act on their behalf.
Section 4.04. Payment Procedures. Payments in respect of the
------------------
Preferred Securities shall be made by check mailed to the address of the Person
entitled thereto as such address shall appear on the Securities Register or, if
the Preferred Securities are held by a Clearing Agency, such Distributions shall
be made to the Clearing Agency in immediately available funds, which shall
credit the relevant Persons' accounts at such Clearing Agency on the applicable
distribution dates. Payments in respect of the Common Securities shall be made
in such manner as shall be mutually agreed between the Property Trustee and the
Common Securityholder.
Section 4.05. Tax Returns and Reports. The Administrative Trustees
-----------------------
shall prepare (or cause to be prepared), at the Depositor's expense, and file
all Federal, state and local tax and information returns and reports required to
be filed by or in respect of the Trust. In this regard, the Administrative
Trustees shall (a) prepare and file (or cause to be prepared or filed) the
appropriate Internal Revenue Service Form required to be filed in respect of the
Trust in each taxable year of the Trust and (b) prepare and furnish (or cause to
be prepared and furnished) to each Securityholder the related Internal Revenue
Service Form 1099 OID, or any successor form or the information required to be
provided on such form. The Administrative Trustees shall provide the Depositor
and the Property Trustee with a copy of all such returns, reports and schedules
promptly after such filing or furnishing. The Trustees shall comply with United
States federal withholding and backup withholding tax laws and information
reporting requirements with respect to any payments to Securityholders under the
Trust Securities.
ARTICLE V
Trust Securities Certificates
Section 5.01. Initial Ownership. Upon the formation of the Trust and
-----------------
the contribution by the Depositor pursuant to Section 2.03 and until the
issuance of the Trust Securities, and at any time during which no Trust
Securities are outstanding, the Depositor shall be the sole beneficial owner of
the Trust.
Section 5.02. The Trust Securities Certificates. The Preferred
---------------------------------
Securities Certificates shall be issued in minimum denominations of $25
Liquidation Amount and integral multiples thereof, and the Common Securities
Certificates shall be issued in denominations of $25 Liquidation Amount and
integral multiples thereof. The Trust Securities Certificates shall be executed
on behalf of the Trust by manual signature of at least one Administrative
Trustee. Trust Securities Certificates bearing the manual signatures of
individuals who were, at the time when such signatures shall have been affixed,
authorized to sign on behalf of the Trust, shall be validly issued and entitled
to the benefits of this Trust
19
<PAGE>
Agreement, notwithstanding that such individuals or any of them shall have
ceased to be so authorized prior to the delivery of such Trust Securities
Certificates or did not hold such offices at the date of delivery of such Trust
Securities Certificates. A transferee of a Trust Securities Certificate shall
become a Securityholder, and shall be entitled to the rights and subject to the
obligations of a Securityholder hereunder, upon due registration of such Trust
Securities Certificate in such transferee's name pursuant to Section 5.04.
Section 5.03. Delivery of Trust Securities Certificates. On the
-----------------------------------------
Closing Date and on any date on which Preferred Securities are required to be
delivered pursuant to the exercise of the overallotment option provided for in
the Underwriting Agreement, the Administrative Trustees shall cause Trust
Securities Certificates, in an aggregate Liquidation Amount as provided in
Sections 2.04 and 2.05, to be executed on behalf of the Trust and delivered to
or upon the written order of the Depositor, signed by its chairman of the board,
its president, any senior vice president or any vice president, without further
corporate action by the Depositor, in authorized denominations.
Section 5.04. Registration of Transfer and Exchange of Preferred
--------------------------------------------------
Securities Certificates. The Securities Registrar shall keep or cause to be
-----------------------
kept, at the office or agency maintained pursuant to Section 5.08, a Securities
Register in which, subject to such reasonable regulations as it may prescribe,
the Securities Registrar shall provide for the registration of Preferred
Securities Certificates and Common Securities Certificates (subject to Section
5.10 in the case of the Common Securities Certificates) and registration of
transfers and exchanges of Preferred Securities Certificates as herein provided.
The Property Trustee shall be the initial Securities Registrar.
Upon surrender for registration of transfer of any Preferred
Securities Certificate at the office or agency maintained pursuant to Section
5.08, the Administrative Trustees or any one of them shall execute and deliver,
in the name of the designated transferee or transferees, one or more new
Preferred Securities Certificates in authorized denominations of a like
aggregate Liquidation Amount dated the date of execution by such Administrative
Trustee or Trustees. The Securities Registrar shall not be required to register
the transfer of any Preferred Securities that have been called for redemption.
At the option of a Holder, Preferred Securities Certificates may be exchanged
for other Preferred Securities Certificates in authorized denominations of the
same class and of a like aggregate Liquidation Amount upon surrender of the
Preferred Securities Certificates to be exchanged at the office or agency
maintained pursuant to Section 5.08.
Every Preferred Securities Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Administrative Trustees and
the Securities Registrar duly executed by the Holder or his attorney duly
authorized in writing. Each Preferred Securities Certificate surrendered for
registration of transfer or exchange shall be cancelled and subsequently
disposed of by the Administrative Trustees in accordance with their customary
practice.
20
<PAGE>
No service charge shall be made for any registration of transfer or
exchange of Preferred Securities Certificates, but the Securities Registrar may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Preferred
Securities Certificates.
Section 5.05. Mutilated, Destroyed, Lost or Stolen Trust Securities
-----------------------------------------------------
Certificates. If (a) any mutilated Trust Securities Certificate shall be
------------
surrendered to the Securities Registrar, or if the Securities Registrar shall
receive evidence to its satisfaction of the destruction, loss or theft of any
Trust Securities Certificate and (b) there shall be delivered to the Securities
Registrar and the Administrative Trustees such security or indemnity as may be
required by them to save each of them harmless, then in the absence of notice
that such Trust Securities Certificate shall have been acquired by a bona fide
purchaser, the Administrative Trustees, or any one of them, on behalf of the
Trust shall execute and make available for delivery, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Trust Securities Certificate, a
new Trust Securities Certificate of like class, tenor and denomination. In
connection with the issuance of any new Trust Securities Certificate under this
Section, the Administrative Trustees or the Securities Registrar may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection therewith. Any duplicate Trust Securities
Certificate issued pursuant to this Section shall constitute conclusive evidence
of an undivided beneficial interest in the assets of the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Trust Securities
Certificate shall be found at any time.
Section 5.06. Persons Deemed Securityholders. The Administrative
------------------------------
Trustees or the Securities Registrar shall treat the Person in whose name any
Trust Securities Certificate shall be registered in the Securities Register as
the owner of such Trust Securities Certificate for the purpose of receiving
distributions and for all other purposes whatsoever, and neither the Trustees
nor the Securities Registrar shall be bound by any notice to the contrary.
Section 5.07. Access to List of Securityholders' Names and Addresses.
------------------------------------------------------
The Administrative Trustees or the Depositor shall furnish or cause to be
furnished (a) to the Property Trustee, semi-annually on or before January 15 and
July 15 in each year, a list, in such form as the Property Trustee may
reasonably require, of the names and addresses of the Securityholders as of the
most recent Record Date and (b) to the Property Trustee, promptly after receipt
by any Administrative Trustee or the Depositor of a request therefor from the
Property Trustee in order to enable the Property Trustee to discharge its
obligations under this Trust Agreement, in each case to the extent such
information is in the possession or control of the Administrative Trustees or
the Depositor and is not identical to a previously supplied list or has not
otherwise been received by the Property Trustee in its capacity as Securities
Registrar. The rights of Securityholders to communicate with other
Securityholders with respect to their rights under this Trust Agreement or under
the Trust Securities, and the corresponding rights of the Trustee shall be as
provided in the Trust Indenture Act. Each Holder, by receiving and holding a
Trust Securities Certificate, and each Owner shall be deemed to have agreed not
to hold the Depositor, the Property Trustee or the Administrative Trustees
accountable by reason of the disclosure of its name and address, regardless of
the source from which such information was derived.
21
<PAGE>
Section 5.08. Maintenance of Office or Agency. The Property Trustee
-------------------------------
shall maintain in Chicago, Illinois, an office or offices or agency or agencies
where Preferred Securities Certificates may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Trustees in
respect of the Trust Securities Certificates may be served. The Property
Trustee shall give prompt written notice to the Depositor and to the
Securityholders of any change in the location of the Securities Register or any
such office or agency.
Section 5.09. Appointment of Paying Agent. The Paying Agent shall
---------------------------
make distributions to Securityholders from the Payment Account and shall report
the amounts of such distributions to the Property Trustee and the Administrative
Trustees. Any Paying Agent shall have the revocable power to withdraw funds
from the Payment Account for the purpose of making the distributions referred to
above. The Administrative Trustees may revoke such power and remove the Paying
Agent if such Trustees determine in their sole discretion that the Paying Agent
shall have failed to perform its obligations under this Trust Agreement in any
material respect. The Paying Agent shall initially be the Property Trustee, and
any co-paying agent chosen by the Bank, and acceptable to the Administrative
Trustees and the Depositor. Any Person acting as Paying Agent shall be
permitted to resign as Paying Agent upon 30 days' written notice to the
Administrative Trustees, the Property Trustee and the Depositor. In the event
that the Bank shall no longer be the Paying Agent or a successor Paying Agent
shall resign or its authority to act be revoked, the Administrative Trustees
shall appoint a successor that is acceptable to the Property Trustee and the
Depositor to act as Paying Agent (which shall be a bank or trust company). The
Administrative Trustees shall cause such successor Paying Agent or any
additional Paying Agent appointed by the Administrative Trustees to execute and
deliver to the Trustees an instrument in which such successor Paying Agent or
additional Paying Agent shall agree with the Trustees that as Paying Agent, such
successor Paying Agent or additional Paying Agent will hold all sums, if any,
held by it for payment to the Securityholders in trust for the benefit of the
Securityholders entitled thereto until such sums shall be paid to such
Securityholders. The Paying Agent shall return all unclaimed funds to the
Property Trustee and upon removal of a Paying Agent such Paying Agent shall also
return all funds in its possession to the Property Trustee. The provisions of
Sections 8.01, 8.03 and 8.06 shall apply to the Bank also in its role as Paying
Agent, for so long as the Bank shall act as Paying Agent and, to the extent
applicable, to any other paying agent appointed hereunder. Any reference in
this Agreement to the Paying Agent shall include any co-paying agent unless the
context requires otherwise.
Section 5.10. Ownership of Common Securities by Depositor. On the
-------------------------------------------
Closing Date and on each other date provided for in Section 2.05, the Depositor
shall acquire and retain beneficial and record ownership of the Common
Securities. To the fullest extent permitted by law, any attempted transfer of
the Common Securities shall be void. The Administrative Trustees shall cause
each Common Securities Certificate issued to the Depositor to contain a legend
stating "THIS CERTIFICATE IS NOT TRANSFERABLE".
Section 5.11. Book-Entry Preferred Securities Certificates; Common
----------------------------------------------------
Securities Certificate.
----------------------
22
<PAGE>
(a) The Preferred Securities Certificates, upon original issuance,
will be issued in the form of a typewritten Preferred Securities Certificate or
Certificates representing Book-Entry Preferred Securities Certificates, to be
delivered to The Depository Trust Company, the initial Clearing Agency, by, or
on behalf of, the Trust. Such Preferred Securities Certificate or Certificates
shall initially be registered on the Securities Register in the name of Cede &
Co., the nominee of the initial Clearing Agency, and no beneficial owner will
receive a Definitive Preferred Securities Certificate representing such
beneficial owner's interest in such Preferred Securities, except as provided in
Section 5.13. Unless and until Definitive Preferred Securities Certificates
have been issued to beneficial owners pursuant to Section 5.13:
(i) the provisions of this Section 5.11(a) shall be in full force
and effect;
(ii) the Securities Registrar and the Trustees shall be entitled to
deal with the Clearing Agency for all purposes of this Trust Agreement
relating to the Book-Entry Preferred Securities Certificates (including the
payment of principal of and interest on the Book-Entry Preferred Securities
and the giving of instructions or directions to Owners of Book-Entry
Preferred Securities) as the sole Holder of Book-Entry Preferred Securities
and shall have no obligations to the Owners thereof;
(iii) to the extent that the provisions of this Section 5.11
conflict with any other provisions of this Trust Agreement, the provisions
of this Section 5.11 shall control; and
(iv) the rights of the Owners of the Book-Entry Preferred
Securities Certificates shall be exercised only through the Clearing Agency
and shall be limited to those established by law and agreements between
such Owners and the Clearing Agency and/or the Clearing Agency
Participants. Pursuant to the Certificate Depository Agreement, unless and
until Definitive Preferred Securities Certificates are issued pursuant to
Section 5.13, the initial Clearing Agency will make book-entry transfers
among the Clearing Agency Participants and receive and transmit payments on
the Preferred Securities to such Clearing Agency Participants.
(b) A single Common Securities Certificate representing the Common
Securities shall be issued to the Depositor in the form of a definitive Common
Securities Certificate.
Section 5.12. Notices to Clearing Agency. To the extent that a
--------------------------
notice or other communication to the Owners is required under this Trust
Agreement, unless and until Definitive Preferred Securities Certificates shall
have been issued to Owners pursuant to Section 5.13, the Trustees shall give all
such notices and communications specified herein to be given to Owners to the
Clearing Agency, and shall have no obligations to the Owners.
Section 5.13. Definitive Preferred Securities Certificates. If (a)
--------------------------------------------
the Depositor advises the Trustees in writing that the Clearing Agency is no
longer willing or able to properly discharge its responsibilities with respect
to the Preferred Securities Certificates, and the Depositor is unable to locate
a qualified successor, (b) the Depositor at its option advises
23
<PAGE>
the Trustees in writing that it elects to terminate the book-entry system
through the Clearing Agency or (c) after the occurrence of a Debenture Event of
Default, Owners of Preferred Securities Certificates representing beneficial
interests aggregating at least a majority of the Liquidation Amount advise the
Clearing Agency in writing that the continuation of a book-entry system through
the Clearing Agency is no longer in the best interest of the Owners of Preferred
Securities Certificates, then the Clearing Agency shall notify all Owners of
Preferred Securities Certificates and the Trustees of the occurrence of any such
event and of the availability of the Definitive Preferred Securities
Certificates to Owners of such class or classes, as applicable, requesting the
same. Upon surrender to the Administrative Trustees of the typewritten
Preferred Securities Certificate or Certificates representing the Book Entry
Preferred Securities Certificates by the Clearing Agency, accompanied by
registration instructions, the Administrative Trustees, or any one of them,
shall execute the Definitive Preferred Securities Certificates in accordance
with the instructions of the Clearing Agency. Neither the Securities Registrar
nor the Trustees shall be liable for any delay in delivery of such instructions
and may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Preferred Securities
Certificates, the Trustees shall recognize the Holders of the Definitive
Preferred Securities Certificates as Securityholders. The Definitive Preferred
Securities Certificates shall be printed, lithographed or engraved or may be
produced in any other manner as is reasonably acceptable to the Administrative
Trustees, as evidenced by the execution thereof by the Administrative Trustees
or any one of them.
Section 5.14. Rights of Securityholders. The legal title to the
-------------------------
Trust Property is vested exclusively in the Property Trustee (in its capacity as
such) in accordance with Section 2.09, and the Securityholders shall not have
any right or title therein other than the undivided beneficial interest in the
assets of the Trust conferred by their Trust Securities and they shall have no
right to call for any partition or division of property, profits or rights of
the Trust except as described below. The Trust Securities shall be personal
property giving only the rights specifically set forth therein and in this Trust
Agreement. The Trust Securities shall have no preemptive or similar rights and
when issued and delivered to Securityholders against payment of the purchase
price therefor will be fully paid and nonassessable by the Trust. The Holders
of the Trust Securities, in their capacities as such, shall be entitled to the
same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
ARTICLE VI
Acts of Securityholders; Meetings; Voting
Section 6.01. Limitations on Voting Rights.
----------------------------
(a) Except as provided in this Section, in Section 10.02 and in the
Indenture and as otherwise required by law, no Holder of Preferred Securities
shall have any right to vote or in any manner otherwise control the
administration, operation and management of the Trust or the obligations of the
parties hereto, nor shall anything herein set forth, or contained
24
<PAGE>
in the terms of the Trust Securities Certificates, be construed so as to
constitute the Securityholders from time to time as partners or members of an
association.
(b) So long as any Debentures are held by the Property Trustee, the
Trustees shall not (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or executing any
trust or power conferred on the Debenture Trustee with respect to such
Debentures, (ii) waive any past default which is waivable under Section 513 of
the Indenture, (iii) exercise any right to rescind or annul a declaration that
the principal of all the Debentures shall be due and payable or (iv) consent to
any amendment, modification or termination of the Indenture or the Debentures,
where such consent shall be required, without, in each case, obtaining the prior
approval of the Holders of at least a majority in Liquidation Amount of all
outstanding Preferred Securities; provided, however, that where a consent under
-------- -------
the Indenture would require the consent of each holder of Debentures affected
thereby, no such consent shall be given by the Property Trustee without the
prior written consent of each holder of Preferred Securities. The Trustees
shall not revoke any action previously authorized or approved by a vote of the
Preferred Securities, except by a subsequent vote of the Preferred Securities.
The Property Trustee shall notify all Holders of the Preferred Securities of any
notice of default received from the Debenture Trustee with respect to the
Debentures. In addition to obtaining the foregoing approvals of the Holders of
the Preferred Securities, prior to taking any of the foregoing actions, the
Trustees shall, at the expense of the Depositor, obtain an Opinion of Counsel
experienced in such matters to the effect that the Trust will not be classified
as an association taxable as a corporation or partnership for United States
federal income tax purposes on account of such action.
(c) If any proposed amendment to the Trust Agreement provides for, or
the Trustees otherwise propose to effect, (i) any action that would adversely
affect in any material respect the powers, preferences or special rights of the
Preferred Securities, whether by way of amendment to the Trust Agreement or
otherwise, or (ii) the dissolution, winding-up or termination of the Trust,
other than pursuant to the terms of this Trust Agreement, then the Holders of
Outstanding Preferred Securities as a class will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of the Holders of at least a majority in Liquidation
Amount of the Outstanding Preferred Securities.
Section 6.02. Notice of Meetings. Notice of all meetings of the
------------------
Preferred Securityholders, stating the time, place and purpose of the meeting,
shall be given by the Property Trustee pursuant to Section 10.08 to each
Preferred Securityholder of record, at his registered address, at least 15 days
and not more than 90 days before the meeting. At any such meeting, any business
properly before the meeting may be so considered whether or not stated in the
notice of the meeting. Any adjourned meeting may be held as adjourned without
further notice.
Section 6.03. Meetings of Preferred Securityholders. No annual
-------------------------------------
meeting of Securityholders is required to be held. The Administrative Trustees,
however, shall call a meeting of Securityholders to vote on any matter upon the
written request of the Preferred Securityholders of record of 25% of the
Preferred Securities (based upon their Liquidation
25
<PAGE>
Amount) and the Administrative Trustees or the Property Trustee may, at any time
in their discretion, call a meeting of Preferred Securityholders to vote on any
matters as to the which Preferred Securityholders are entitled to vote.
Preferred Securityholders of record of 50% of the Preferred Securities
(based upon their Liquidation Amount), present in person or by proxy, shall
constitute a quorum at any meeting of Securityholders.
If a quorum is present at a meeting, an affirmative vote by the
Preferred Securityholders of record present, in person or by proxy, holding more
than a majority of the Preferred Securities (based upon their Liquidation
Amount) held by the Preferred Securityholders of record present, either in
person or by proxy, at such meeting shall constitute the action of the
Securityholders, unless this Trust Agreement requires a greater number of
affirmative votes.
Section 6.04. Voting Rights. Securityholders shall be entitled to
-------------
one vote for each $25 of Liquidation Amount represented by their Trust
Securities in respect of any matter as to which such Securityholders are
entitled to vote.
Section 6.05. Proxies, etc. At any meeting of Securityholders, any
-------------
Securityholder entitled to vote thereat may vote by proxy, provided that no
proxy shall be voted at any meeting unless it shall have been placed on file
with the Administrative Trustees, or with such other officer or agent of the
Trust as the Administrative Trustees may direct, for verification prior to the
time at which such vote shall be taken. Pursuant to a resolution of the
Property Trustee, proxies may be solicited in the name of the Property Trustee
or one or more officers of the Property Trustee. Only Securityholders of record
shall be entitled to vote. When Trust Securities are held jointly by several
persons, any one of them may vote at any meeting in person or by proxy in
respect of such Trust Securities, but if more than one of them shall be present
at such meeting in person or by proxy, and such joint owners or their proxies so
present disagree as to any vote to be cast, such vote shall not be received in
respect of such Trust Securities. A proxy purporting to be executed by or on
behalf of a Securityholder shall be deemed valid unless challenged at or prior
to its exercise, and the burden of proving invalidity shall rest on the
challenger. No proxy shall be valid more than three years after its date of
execution.
Section 6.06. Securityholder Action by Written Consent. Any action
----------------------------------------
which may be taken by Securityholders at a meeting may be taken without a
meeting if Securityholders holding more than a majority of all Outstanding Trust
Securities (based upon their Liquidation Amount) entitled to vote in respect of
such action (or such larger proportion thereof as shall be required by any
express provision of this Trust Agreement) shall consent to the action in
writing.
Section 6.07. Record Date for Voting and Other Purposes. For the
-----------------------------------------
purposes of determining the Securityholders who are entitled to notice of and to
vote at any meeting or by written consent, or to participate in any distribution
on the Trust Securities in respect of which a record date is not otherwise
provided for in this Trust Agreement, or for the purpose of any other action,
the Administrative Trustees may from time to time fix a date, not more
26
<PAGE>
than 90 days prior to the date of any meeting of Securityholders or the payment
of distribution or other action, as the case may be, as a record date for the
determination of the identity of the Securityholders of record for such
purposes.
Section 6.08. Acts of Securityholders. Any request, demand,
-----------------------
authorization, direction, notice, consent, waiver or other action provided or
permitted by this Trust Agreement to be given, made or taken by Securityholders
or Owners may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Securityholders or Owners in person
or by an agent duly appointed in writing; and, except as otherwise expressly
provided herein, such action shall become effective when such instrument or
instruments are delivered to an Administrative Trustee. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Securityholders or Owners signing such
instrument or instruments. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any purpose of this
Trust Agreement and (subject to Section 8.01) conclusive in favor of the
Trustees, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgements of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which any Trustee receiving the same deems sufficient.
The ownership of Preferred Securities shall be proved by the
Securities Register.
Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Securityholder of any Trust Security shall bind every future
Securityholder of the same Trust Security and the Securityholder of every Trust
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
Without limiting the foregoing, a Securityholder entitled hereunder to
take any action hereunder with regard to any particular Trust Security may do so
with regard to all or any part of the Liquidation Amount of such Trust Security
or by one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such liquidation amount.
If any dispute shall arise between the Securityholders and the
Administrative Trustees or among such Securityholders or Trustees with respect
to the authenticity, validity or binding nature of any request, demand,
authorization, direction, consent, waiver or other
27
<PAGE>
Act of such Securityholder or Trustee under this Article VI, then the
determination of such matter by the Property Trustee shall be conclusive with
respect to such matter.
Section 6.09. Inspection of Records. Upon reasonable notice to the
---------------------
Administrative Trustees and the Property Trustee, the records of the Trust shall
be open to inspection by Securityholders during normal business hours for any
purpose reasonably related to such Securityholder's interest as a
Securityholder.
ARTICLE VII
Representations and Warranties
Section 7.01. Representations and Warranties of the Bank, the
-----------------------------------------------
Property Trustee and the Delaware Trustee. The Bank, the Property Trustee and
-----------------------------------------
the Delaware Trustee, each severally on behalf of and as to itself, hereby
represents and warrants for the benefit of the Depositor and the Securityholders
that:
(a) the Bank is a national banking association duly organized,
validly existing and in good standing under the laws of the United States;
(b) the Bank has full corporate power, authority and legal right to
execute, deliver and perform its obligations under this Trust Agreement and
has taken all necessary action to authorize the execution, delivery and
performance by it of this Trust Agreement;
(c) this Trust Agreement has been duly authorized, executed and
delivered by the Bank and constitutes the valid and legally binding
agreement of the Bank enforceable against it in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles;
(d) the Trust Securities Certificates issued on the Closing Date on
behalf of the Trust have been, and any Trust Securities Certificates to be
issued at the time of exercise, if any, of the overallotment option under
the Underwriting Agreement will be, duly authorized and will have been, as
of each such date, duly and validly executed, issued and delivered by the
Trustees pursuant to the terms and provisions of, and in accordance with
the requirements of, this Trust Agreement and the Securityholders will be,
as of each such date, entitled to the benefits of this Trust Agreement;
(e) the execution, delivery and performance by the Bank of this Trust
Agreement and the issuance of the Trust Securities pursuant to this Trust
Agreement have been duly authorized by all necessary corporate or other
action on the part of the Bank, the Property Trustee, and the Delaware
Trustee and do not require any approval of stockholders of the Bank and
such execution, delivery and performance will not (i) violate the Bank's
Charter or By-laws, (ii) violate any provision of, or
28
<PAGE>
constitute, with or without notice or lapse of time, a default under, or
result in the creation or imposition of, any Lien on any properties
included in the Trust Property pursuant to the provisions of, any
indenture, mortgage, credit agreement, license or other agreement or
instrument to which the Property Trustee, the Bank or the Delaware Trustee
is a party or by which it is bound, or (iii) violate any law, governmental
rule or regulation of the United States or the State of Delaware, as the
case may be, governing the banking or trust powers of the Bank and the
Property Trustee or the Delaware Trustee (as appropriate in context) or any
order, judgment or decree applicable to the Property Trustee, the Bank or
the Delaware Trustee;
(f) neither the authorization, execution or delivery by the Bank of
this Trust Agreement nor the consummation of any of the transactions by the
Bank, the Property Trustee or the Delaware Trustee (as appropriate in
context) contemplated herein or therein nor the issuance of the Trust
Securities Certificates pursuant to this Trust Agreement require the
consent or approval of, the giving of notice to, the registration with or
the taking of any other action with respect to any governmental authority
or agency under any existing federal law governing the banking or trust
powers of the Bank or under the laws of the United States or the State of
Delaware;
(g) there are no taxes, fees or other governmental charges payable by
the Trust (or the Trustees on behalf of the Trust) under the laws of the
United States or the State of Delaware or any political subdivision thereof
in connection with the execution, delivery and performance by the Bank, the
Property Trustee or the Delaware Trustee, as the case may be, of this Trust
Agreement; and
(h) there are no proceedings pending or, to the best of the Bank's
and the Delaware Trustee's knowledge, threatened against or affecting the
Bank, the Property Trustee or the Delaware Trustee in any court or before
any governmental authority, agency or arbitration board or tribunal which,
individually or in the aggregate, would materially and adversely affect the
Trust or would question the right, power and authority of the Bank to enter
into or perform its obligations as one of the Trustees under this Trust
Agreement.
ARTICLE VIII
The Trustees
Section 8.01. Certain Duties and Responsibilities.
-----------------------------------
(a) The duties and responsibilities of the Trustees shall be as
provided by this Trust Agreement and, in the case of the Property Trustee, by
the Trust Indenture Act. The Property Trustee, other than during the occurrence
and continuance of an Event of Default, undertakes to perform only such duties
as are specifically set forth in this Trust Agreement and, after an Event of
Default, must exercise the same degree of care and skill as a prudent person
would exercise or use in the conduct of his or her own affairs. The Trustees
shall have all the privileges, rights, and immunities provided by the Delaware
Business Trust Act.
29
<PAGE>
Notwithstanding the foregoing, no provision of this Trust Agreement shall
require the Trustees to expend or risk their own funds or otherwise incur any
financial liability in the performance of any of their duties hereunder, or in
the exercise of any of their rights or powers, if they shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Trust Agreement relating to the
conduct or affecting the liability of or affording protection to the Trustees
shall be subject to the provisions of this Section. Nothing in this Trust
Agreement shall be construed to release the Property Trustee from liability for
its own negligent action, its own failure to act, or its own willful misconduct.
To the extent that, at law or in equity, an Administrative Trustee has duties
(including fiduciary duties) and liabilities relating thereto to the Trust or to
the Securityholders, such Administrative Trustee shall not be liable to the
Trust or to any Securityholder for such Trustee's good faith reliance on the
provisions of this Trust Agreement. The provisions of this Trust Agreement, to
the extent that they restrict the duties and liabilities of the Administrative
Trustees otherwise existing at law or in equity, are agreed by the Depositor and
the Securityholders to replace such other duties and liabilities of the
Administrative Trustees.
(b) All payments made by the Property Trustee or a Paying Agent in
respect of the Trust Securities shall be made only from the income and proceeds
from the Trust Property. Each Securityholder, by its acceptance of a Trust
Security, agrees that it will look solely to the income and proceeds from the
Trust Property to the extent legally available for distribution to it as herein
provided and that the Trustees are not personally liable to it for any amount
distributable in respect of any Trust Security or for any other liability in
respect of any Trust Security. This Section 8.01(b) does not limit the
liability of the Trustees expressly set forth elsewhere in this Trust Agreement
or, in the case of the Property Trustee, in the Trust Indenture Act.
Section 8.02. Notice of Defaults. Within five Business Days after
------------------
the occurrence of any Event of Default actually known to the Property Trustee,
the Property Trustee shall transmit, in the manner and to the extent provided in
Section 10.08, notice of such Event of Default to the Securityholders, the
Administrative Trustees and the Depositor, unless such Event of Default shall
have been cured or waived.
Section 8.03. Certain Rights of Property Trustee. Subject to the
----------------------------------
provisions of Section 8.01:
(a) the Property Trustee may rely and shall be protected in acting or
refraining from acting in good faith upon any resolution, Opinion of
Counsel, certificate, written representation of a Holder or transferee,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(b) if, other than during the occurrence and continuance of an Event
of Default, (i) in performing its duties under this Trust Agreement the
Property Trustee
30
<PAGE>
is required to decide between alternative courses of action or (ii) in
construing any of the provisions in this Trust Agreement the Property
Trustee finds the same ambiguous or inconsistent with any other provisions
contained herein or (iii) the Property Trustee is unsure of the application
of any provision of this Trust Agreement, then, except as to any matter as
to which the Preferred Securityholders are entitled to vote under the terms
of this Trust Agreement, the Property Trustee shall deliver a notice to the
Depositor requesting written instructions of the Depositor as to the course
of action to be taken. The Property Trustee shall take such action, or
refrain from taking such action, as the Property Trustee shall be
instructed in writing to take, or to refrain from taking, by the Depositor;
provided, however, that if the Property Trustee does not receive such
-------- -------
instructions of the Depositor within ten Business Days after it has
delivered such notice, or such reasonably shorter period of time set forth
in such notice (which to the extent practicable shall not be less than two
Business Days), it may, but shall be under no duty to, take or refrain from
taking such action not inconsistent with this Trust Agreement as it shall
deem advisable and in the best interests of the Securityholders, in which
event the Property Trustee shall have no liability except for its own bad
faith, negligence or willful misconduct;
(c) the Property Trustee may consult with counsel or other experts
and the written advice or opinion of such counsel and experts with respect
to legal matters or advice within the scope of such experts' area of
expertise shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon;
(d) the Property Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Trust Agreement at the request
or direction of any of the Securityholders pursuant to this Trust
Agreement, unless such Securityholders shall have offered to the Property
Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such request
or direction;
(e) the Property Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
approval, bond, debenture, note or other evidence of indebtedness or other
paper or document, but the Property Trustee, in its discretion, may make
such further inquiry or investigation into such facts or matters as it may
see fit; and
(f) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
its agents or attorneys and the Property Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder.
Section 8.04. Not Responsible for Recitals or Issuance of Securities.
------------------------------------------------------
The recitals contained herein and in the Trust Securities Certificates shall be
taken as the statements of the Trust, and the Trustees do not assume any
responsibility for their
31
<PAGE>
correctness. The Trustees shall not be accountable for the use or application
by the Depositor of the proceeds of the Debentures.
Section 8.05. May Hold Securities. Except as provided in the
-------------------
definition of the term "Outstanding" in Article I, any Trustee or any other
agent of any Trustee or the Trust, in its individual or any other capacity, may
become the owner or pledgee of Trust Securities and, subject to Sections 8.08
and 8.13, may otherwise deal with the Trust with the same rights it would have
if it were not a Trustee or such other agent.
Section 8.06. Compensation; Indemnity; Fees.
-----------------------------
The Depositor agrees:
(a) to pay to the Trustees from time to time reasonable compensation
for all services rendered by them hereunder (which compensation shall not
be limited by any provision of law in regard to the compensation of a
trustee of an express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Trustees upon request for all reasonable expenses, disbursements and
advances incurred or made by the Trustees in accordance with any provision
of this Trust Agreement (including the reasonable compensation and the
expenses and disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to its negligence
or bad faith; and
(c) to indemnify each of the Trustees or any predecessor Trustee for,
and to hold the Trustees harmless against, any loss, damage, claims,
liability, penalty or expense incurred without negligence or bad faith on
its part, arising out of or in connection with the acceptance or
administration of this Trust Agreement, including the costs and expenses of
defending itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder.
No Trustee may claim any lien or charge on any Trust Property as a
result of any amount due pursuant to this Section 8.06.
Section 8.07. Corporate Property Trustee Required; Eligibility of
---------------------------------------------------
Trustees.
--------
(a) There shall at all times be a Property Trustee hereunder with
respect to the Trust Securities. The Property Trustee shall be a Person that is
eligible pursuant to the Trust Indenture Act to act as such and has a combined
capital and surplus of at least $50,000,000. If any such Person publishes
reports of condition at least annually, pursuant to law or to the requirements
of its supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such Person shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Property Trustee with respect to the
Trust Securities shall cease to be
32
<PAGE>
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.
(b) There shall at all times be one or more Administrative Trustees
hereunder with respect to the Trust Securities. Each Administrative Trustee
shall be either a natural person who is at least 21 years of age or a legal
entity that shall act through one or more persons authorized to bind that
entity.
(c) There shall at all times be a Delaware Trustee with respect to
the Trust Securities. The Delaware Trustee shall either be (i) a natural person
who is at least 21 years of age and a resident of the State of Delaware or (ii)
a legal entity with its principal place of business in the State of Delaware and
that otherwise meets the requirements of applicable Delaware law that shall act
through one or more persons authorized to bind such entity.
Section 8.08. Conflicting Interests. If the Property Trustee has or
---------------------
shall acquire a conflicting interest within the meaning of the Trust Indenture
Act, the Property Trustee shall either eliminate such interest or resign, to the
extent and in the manner provided by, and subject to the provisions of, the
Trust Indenture Act and this Trust Agreement.
Section 8.09. Co-Trustees and Separate Trustee. Unless an Event of
--------------------------------
Default shall have occurred and be continuing, at any time or times, for the
purpose of meeting the legal requirements of the Trust Indenture Act or of any
jurisdiction in which any part of the Trust Property may at the time be located,
the Depositor and the Administrative Trustees, by agreed action of the majority
of such Trustees, shall have power to appoint, and upon the written request of
the Administrative Trustees, the Depositor shall for such purpose join with the
Administrative Trustees in the execution, delivery, and performance of all
instruments and agreements necessary or proper to appoint, one or more Persons
approved by the Property Trustee either to act as co-trustee, jointly with the
Property Trustee, of all or any part of such Trust Property, or to the extent
required by law to act as separate trustee of any such property, in either case
with such powers as may be provided in the instrument of appointment, and to
vest in such Person or Persons in the capacity aforesaid, any property, title,
right or power deemed necessary or desirable, subject to the other provisions of
this Section. If the Depositor does not join in such appointment within 15 days
after the receipt by it of a request so to do, or in case a Debenture Event of
Default has occurred and is continuing, the Property Trustee alone shall have
power to make such appointment. Any co-trustee or separate trustee appointed
pursuant to this Section shall either be (i) a natural person who is at least 21
years of age and a resident of the United States or (ii) a legal entity with its
principal place of business in the United States that shall act through one or
more persons authorized to bond such entity.
Should any written instrument from the Depositor be required by any
co-trustee or separate trustee so appointed for more fully confirming to such
co-trustee or separate trustee such property, title, right, or power, any and
all such instruments shall, on request, be executed, acknowledged, and delivered
by the Depositor.
Every co-trustee or separate trustee shall, to the extent permitted by
law, but to such extent only, be appointed subject to the following terms,
namely:
33
<PAGE>
(a) The Trust Securities shall be executed and delivered and all
rights, powers, duties, and obligations hereunder in respect of the custody
of securities, cash and other personal property held by, or required to be
deposited or pledged with, the Trustees specified hereunder, shall be
exercised, solely by such Trustees and not by such co-trustee or separate
trustee.
(b) The rights, powers, duties, and obligations hereby conferred or
imposed upon the Property Trustee in respect of any property covered by
such appointment shall be conferred or imposed upon and exercised or
performed by the Property Trustee or by the Property Trustee and such co-
trustee or separate trustee jointly, as shall be provided in the instrument
appointing such co-trustee or separate trustee, except to the extent that
under any law of any jurisdiction in which any particular act is to be
performed, the Property Trustee shall be incompetent or unqualified to
perform such act, in which event such rights, powers, duties, and
obligations shall be exercised and performed by such co-trustee or separate
trustee.
(c) The Property Trustee at any time, by an instrument in writing
executed by it, with the written concurrence of the Depositor, may accept
the resignation of or remove any co-trustee or separate trustee appointed
under this Section, and, in case an Event of Default under the Indenture
has occurred and is continuing, the Property Trustee shall have power to
accept the resignation of, or remove, any such co-trustee or separate
trustee without the concurrence of the Depositor. Upon the written request
of the Property Trustee, the Depositor shall join with the Property Trustee
in the execution, delivery, and performance of all instruments and
agreements necessary or proper to effectuate such resignation or removal.
A successor to any co-trustee or separate trustee so resigned or removed
may be appointed in the manner provided in this Section.
(d) No co-trustee or separate trustee hereunder shall be personally
liable by reason of any act or omission of the Property Trustee, or any
other trustee hereunder.
(e) The Property Trustee shall not be liable by reason of any act of
a co-trustee or separate trustee.
(f) Any Act of Holders delivered to the Property Trustee shall be
deemed to have been delivered to each such co-trustee and separate trustee.
Section 8.10. Resignation and Removal; Appointment of Successor. No
-------------------------------------------------
resignation or removal of any Trustee (the "Relevant Trustee") and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 8.11.
34
<PAGE>
Any Trustee may resign at any time with respect to the Trust
Securities by giving written notice thereof to the Securityholders. If the
instrument of acceptance by the successor Trustee required by Section 8.11 shall
not have been delivered to the Relevant Trustee within 30 days after the giving
of such notice of resignation, the Relevant Trustee may petition, at the expense
of the Company, any court of competent jurisdiction for the appointment of a
successor Relevant Trustee with respect to the Trust Securities.
Unless a Debenture Event of Default shall have occurred and be
continuing, any Trustee may be removed at any time by Act of the Common
Securityholder. If a Debenture Event of Default shall have occurred and be
continuing, the Property Trustee or the Delaware Trustee, or both of them, may
be removed at such time by Act of the Holders of a majority in Liquidation
Amount of the Preferred Securities, delivered to the Relevant Trustee (in its
individual capacity and on behalf of the Trust). An Administrative Trustee may
be removed by the Common Securityholder at any time.
If any Trustee shall resign, be removed or become incapable of acting
as Trustee, or if a vacancy shall occur in the office of any Trustee for any
cause, at a time when no Event of Default shall have occurred and be continuing,
the Common Securityholder, by Act of the Common Securityholder delivered to the
retiring Trustee, shall promptly appoint a successor Trustee or Trustees with
respect to the Trust Securities and the Trust, and the retiring Trustee shall
comply with the applicable requirements of Section 8.11. If the Property Trustee
or the Delaware Trustee shall resign, be removed or become incapable of
continuing to act as the Property Trustee or the Delaware Trustee, as the case
may be, at a time when a Debenture Event of Default is continuing, the Preferred
Securityholders, by Act of the Securityholders of a majority in Liquidation
Amount of the Preferred Securities then Outstanding delivered to the retiring
Relevant Trustee, shall promptly appoint a successor Relevant Trustee or
Trustees with respect to the Trust Securities and the Trust, and such successor
Trustee shall comply with the applicable requirements of Section 8.11. If an
Administrative Trustee shall resign, be removed or become incapable of acting as
Adminstrative Trustee, at a time when a Debenture Event of Default shall have
occured and be continuing, the Common Securityholder shall appoint a successor
or Administrative Trustees. If no successor Relevant Trustee with respect to the
Trust Securities shall have been so appointed by the Common Securityholder or
the Preferred Securityholders and accepted appointment in the manner required by
Section 8.11, any Securityholder who has been a Securityholder of Trust
Securities for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Relevant Trustee with respect to the Trust
Securities.
The Property Trustee shall give notice of each resignation and each
removal of a Trustee and each appointment of a successor Trustee to all
Securityholders in the manner provided in Section 10.08 and shall give notice to
the Depositor. Each notice shall include the name of the successor Relevant
Trustee and the address of its Corporate Trust Office if it is the Property
Trustee.
Notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event any Administrative Trustee or a Delaware Trustee who is
a natural person dies or becomes, in the opinion of the Depositor, incompetent
or incapacitated, the vacancy created by such death, incompetence or incapacity
may be filled by (a) the unanimous act of remaining Administrative Trustees if
there are at least two of them or (b) otherwise by the
35
<PAGE>
Depositor (with the successor in each case being a Person who satisfies the
eligibility requirement for Administrative Trustees set forth in Section 8.07).
Section 8.11. Acceptance of Appointment by Successor. In case of the
--------------------------------------
appointment hereunder of a successor Trustee such successor Trustee so appointed
shall execute, acknowledge and deliver to the Trust and to the retiring Trustee
an instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Trustee shall become effective and such successor
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Trustee; but, on the
request of the Depositor or the successor Trustee, such retiring Trustee shall,
upon payment of its charges, execute and deliver an instrument transferring to
such successor Trustee all the rights, powers and trusts of the retiring Trustee
and if the Property Trustee is the resigning Trustee shall duly assign, transfer
and deliver to the successor Trustee all property and money held by such
retiring Property Trustee hereunder.
In case of the appointment hereunder of a successor Relevant Trustee
with respect to the Trust Securities and the Trust, the retiring Relevant
Trustee and each successor Relevant Trustee with respect to the Trust Securities
shall execute and deliver an amendment hereto wherein each successor Relevant
Trustee shall accept such appointment and which (a) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Relevant Trustee all the rights, powers, trusts and
duties of the retiring Relevant Trustee with respect to the Trust Securities and
the Trust and (b) shall add to or change any of the provisions of this Trust
Agreement as shall be necessary to provide for or facilitate the administration
of the trusts hereunder by more than one Relevant Trustee, it being understood
that nothing herein or in such amendment shall constitute such Relevant Trustees
co-trustees of the same trust and that each such Relevant Trustee shall be
trustee of a trust or trusts hereunder separate and apart from any trust or
trusts hereunder administered by any other such Relevant Trustee and upon the
execution and delivery of such amendment the resignation or removal of the
retiring Relevant Trustee shall become effective to the extent provided therein
and each such successor Relevant Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Relevant Trustee with respect to the Trust Securities and the
Trust; but, on request of the Trust or any successor Relevant Trustee such
retiring Relevant Trustee shall duly assign, transfer and deliver to such
successor Relevant Trustee all Trust Property, all proceeds thereof and money
held by such retiring Relevant Trustee hereunder with respect to the Trust
Securities and the Trust.
Upon request of any such successor Relevant Trustee, the Trust shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Relevant Trustee all such rights, powers and trusts
referred to in the first or second preceding paragraph, as the case may be.
No successor Relevant Trustee shall accept its appointment unless at
the time of such acceptance such successor Relevant Trustee shall be qualified
and eligible under this Article.
36
<PAGE>
Section 8.12. Merger, Conversion, Consolidation or Succession to
--------------------------------------------------
Business. Any corporation into which the Property Trustee, the Delaware Trustee
--------
or any Administrative Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which such Relevant Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of such Relevant Trustee, shall be the successor of such Relevant Trustee
hereunder, provided such corporation shall be otherwise qualified and eligible
under this Article, without the execution or filing of any paper or any further
act on the part of any of the parties hereto.
Section 8.13. Preferential Collection of Claims Against Depositor or
------------------------------------------------------
Trust. If and when the Property Trustee or the Delaware Trustee shall be or
-----
become a creditor of the Depositor or the Trust (or any other obligor upon the
Debentures or the Trust Securities), the Property Trustee or the Delaware
Trustee, as the case may be, shall be subject to and shall take all actions
necessary in order to comply with the provisions of the Trust Indenture Act
regarding the collection of claims against the Depositor or Trust (or any such
other obligor).
Section 8.14. Reports by Property Trustee.
---------------------------
(a) Within 60 days after December 31 of each year commencing with
December 31, 1995 the Property Trustee shall transmit to all Securityholders in
accordance with Section 10.08, and to the Depositor, a brief report dated as of
such December 31 with respect to:
(i) its eligibility under Section 8.07 or, in lieu thereof, if to
the best of its knowledge it has continued to be eligible under said
Section, a written statement to such effect;
(ii) a statement that the Property Trustee has complied with all of
its obligations under this Trust Agreement during the twelve-month period
(or, in the case of the initial report, the period since the Closing Date)
ending with such December 31 or, if the Property Trustee has not complied
in any material respect with such obligations, a description of such non-
compliance; and
(iii) any change in the property and funds in its possession as
Property Trustee since the date of its last report and any action taken by
the Property Trustee in the performance of its duties hereunder which it
has not previously reported and which in its opinion materially affects the
Trust Securities.
(b) In addition the Property Trustee shall transmit to
Securityholders such reports concerning the Property Trustee and its actions
under this Trust Agreement as may be required pursuant to the Trust Indenture
Act at the times and in the manner provided pursuant thereto.
(c) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Property Trustee with each stock
exchange upon which the Trust Securities are listed, with the Commission and
with the Depositor.
37
<PAGE>
Section 8.15. Reports to the Property Trustee. The Depositor and the
-------------------------------
Administrative Trustees on behalf of the Trust shall provide to the Property
Trustee such documents, reports and information as required by Section 314 of
the Trust Indenture Act (if any) and the compliance certificate required by
Section 314(a) of the Trust Indenture Act in the form, in the manner and at the
times required by Section 314 of the Trust Indenture Act.
Section 8.16. Evidence of Compliance with Conditions Precedent. Each
------------------------------------------------
of the Depositor and the Administrative Trustees on behalf of the Trust shall
provide to the Property Trustee such evidence of compliance with any conditions
precedent, if any, provided for in this Trust Agreement that relate to any of
the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) of the Trust Indenture Act shall be given in the form of an Officers'
Certificate.
Section 8.17. Number of Trustees.
------------------
(a) The number of Trustees shall be five, provided that the Holder of
all of the Common Securities by written instrument may increase or decrease the
number of Administrative Trustees.
(b) If a Trustee ceases to hold office for any reason and the number
of Administrative Trustees is not reduced pursuant to Section 8.17(a), or if the
number of Trustees is increased pursuant to Section 8.17(a), a vacancy shall
occur. The vacancy shall be filled with a Trustee appointed in accordance with
Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to annul the Trust. Whenever a vacancy in the number of Administrative Trustees
shall occur, until such vacancy is filled by the appointment of an
Administrative Trustee in accordance with Section 8.10, the Administrative
Trustees in office, regardless of their number (and notwithstanding any other
provision of this Agreement), shall have all the powers granted to the
Administrative Trustees and shall discharge all the duties imposed upon the
Administrative Trustees by this Trust Agreement.
Section 8.18. Delegation of Power.
-------------------
(a) Any Administrative Trustee may, by power of attorney consistent
with applicable law, delegate to any other natural person over the age of 21 his
or her power for the purpose of executing any documents contemplated in Section
2.07(a), including any registration statement or amendment thereto filed with
the Commission, or making any other governmental filing; and
(b) the Administrative Trustees shall have power to delegate from
time to time to such of their number or to the Depositor the doing of such
things and the execution of such instruments either in the name of the Trust or
the names of the Administrative Trustees or otherwise as the Administrative
Trustees may deem expedient, to the extent such delegation
38
<PAGE>
is not prohibited by applicable law or contrary to the provisions of the Trust,
as set forth herein.
ARTICLE IX
Termination and Liquidation
Section 9.01. Termination Upon Expiration Date. Unless earlier
--------------------------------
terminated, the Trust shall automatically terminate on December 31, 2031 (the
"Expiration Date"), following the distribution of the Trust Property in
accordance with Section 9.04.
Section 9.02. Early Termination. The first to occur of any of the
-----------------
following events is an "Early Termination Event":
(a) the occurrence of a Bankruptcy Event in respect of, or the
dissolution or liquidation of, the Depositor;
(b) the occurrence of a Tax Event or an Investment Company Event
(each, a "Special Event"), or the Trust is or will not be taxed as a
grantor trust but a Tax Event has not occurred (a "Grantor Trust Event"),
and written direction to the Property Trustee from the Depositor within 45
days of such Special Event or Grantor Trust Event (which direction is
optional and wholly within the discretion of the Depositor) to terminate
the Trust and distribute Debentures to Securityholders in accordance with
Section 9.04;
(c) the redemption of all of the Preferred Securities; and
(d) an order for dissolution of the Trust shall have been entered by a
court of competent jurisdiction.
Section 9.03. Termination. The respective obligations and
-----------
responsibilities of the Trustees and the Trust created and continued hereby
shall terminate upon the latest to occur of the following: (a) the distribution
by the Property Trustee to Securityholders upon the liquidation of the Trust
pursuant to Section 9.04, or upon the redemption of all of the Trust Securities
pursuant to Section 4.02, of all amounts required to be distributed hereunder
upon the final payment of the Trust Securities; (b) the payment of any expenses
owed by the Trust; and (c) the discharge of all administrative duties of the
Administrative Trustees, including the performance of any tax reporting
obligations with respect to the Trust or the Securityholders.
Section 9.04. Liquidation.
-----------
(a) If an Early Termination Event specified in clause (a), (b) or (d)
of Section 9.02 occurs or upon the Expiration Date, the Trust shall be
liquidated by the Trustees as expeditiously as the Trustees determine to be
possible by distributing, after satisfaction of liabilities to creditors of the
Trust as provided by applicable law, to each Securityholder a Like Amount of
Debentures, subject to Section 9.04(d). Notice of liquidation shall be given
39
<PAGE>
by the Property Trustee by first-class mail, postage prepaid, mailed not later
than 30 nor more than 60 days prior to the Liquidation Date to each Holder of
Trust Securities at such Holder's address appearing in the Securities Register.
All notices of liquidation shall:
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the Trust
Securities will no longer be deemed to be outstanding and any Trust
Securities Certificates not surrendered for exchange will be deemed to
represent a Like Amount of Debentures; and
(iii) provide such information with respect to the mechanics by
which Holders may exchange Trust Securities Certificates for Debentures, or
if Section 9.04(d) applies receive a Liquidation Distribution, as the
Administrative Trustees or the Property Trustee shall deem appropriate.
(b) Except where Section 9.02(c) or 9.04(d) applies, in order to
effect the liquidation of the Trust and distribution of the Debentures to
Securityholders, the Property Trustee shall establish a record date for such
distribution (which shall be not more than 45 days prior to the Liquidation
Date) and, either itself acting as exchange agent or through the appointment of
a separate exchange agent, shall establish such procedures as it shall deem
appropriate to effect the distribution of Debentures in exchange for the
Outstanding Trust Securities Certificates.
(c) Except where Section 9.02(c) or 9.04(d) applies, after the
Liquidation Date, (i) the Trust Securities will no longer be deemed to be
Outstanding, (ii) certificates representing a Like Amount of Debentures will be
issued to Holders of Trust Securities Certificates, upon surrender of such
certificates to the Administrative Trustees or their agent for exchange, (iii)
any Trust Securities Certificates not so surrendered for exchange will be deemed
to represent a Like Amount of Debentures, accruing interest at the rate provided
for in the Debentures from the last Distribution Date on which a Distribution
was made on such Trust Certificates until such certificates are so surrendered
(and until such certificates are so surrendered, no payments or interest or
principal will be made to Holders of Trust Securities Certificates with respect
to such Debentures) and (iv) all rights of Securityholders holding Trust
Securities will cease, except the right of such Securityholders to receive
Debentures upon surrender of Trust Securities Certificates.
(d) In the event that, notwithstanding the other provisions of this
Section 9.04, whether because of an order for dissolution entered by a court of
competent jurisdiction or otherwise, distribution of the Debentures in the
manner provided herein is determined by the Property Trustee not to be
practical, the Trust Property shall be liquidated, and the Trust shall be
dissolved, wound-up or terminated, by the Property Trustee in such manner as the
Property Trustee determines. In such event, on the date of the dissolution,
winding-up or other termination of the Trust, Securityholders will be entitled
to receive out of the assets of the Trust available for distribution to
Securityholders, after satisfaction of liabilities to creditors of the Trust as
provided by applicable law, an amount equal to the Liquidation Amount per Trust
Security plus accrued and unpaid Distributions thereon to the
40
<PAGE>
date of payment (such amount being the "Liquidation Distribution"). If, upon
any such dissolution, winding up or termination, the Liquidation Distribution
can be paid only in part because the Trust has insufficient assets available to
pay in full the aggregate Liquidation Distribution, then, subject to the next
succeeding sentence, the amounts payable by the Trust on the Trust Securities
shall be paid on a pro rata basis (based upon Liquidation Amounts). The Holder
--- ----
of the Common Securities will be entitled to receive Liquidation Distributions
upon any such dissolution, winding-up or termination pro rata (determined as
--- ----
aforesaid) with Holders of Preferred Securities, except that, if a Debenture
Event of Default has occurred and is continuing, the Preferred Securities shall
have a priority over the Common Securities.
ARTICLE X
Miscellaneous Provisions
Section 10.01. Limitation of Rights of Securityholders. The death or
---------------------------------------
incapacity of any person having an interest, beneficial or otherwise, in Trust
Securities shall not operate to terminate this Trust Agreement, nor entitle the
legal representatives or heirs of such person or any Securityholder for such
person, to claim an accounting, take any action or bring any proceeding in any
court for a partition or winding up of the arrangements contemplated hereby, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
Section 10.02. Amendment.
---------
(a) This Trust Agreement may be amended from time to time by the
Trustees and the Depositor, without the consent of any Securityholders, (i) to
cure any ambiguity, correct or supplement any provision herein or therein which
may be inconsistent with any other provision herein or therein, or to make any
other provisions with respect to matters or questions arising under this Trust
Agreement, which shall not be inconsistent with the other provisions of this
Trust Agreement, or (ii) to modify, eliminate or add to any provisions of this
Trust Agreement to such extent as shall be necessary to ensure that the Trust
will be classified for Federal income tax purposes as a grantor trust at all
times that any Trust Securities are outstanding; provided, however, that such
-------- -------
action shall not adversely affect in any material respect the interests of any
Securityholder and, in the case of clause (i), any amendments of this Trust
Agreement shall become effective when notice thereof is given to the
Securityholders.
(b) Except as provided in Section 10.02(c) hereof, any provision of
this Trust Agreement may be amended by the Trustees and the Depositor with (i)
the consent of Trust Securityholders representing not less than a majority
(based upon Liquidation Amounts) of the Trust Securities then Outstanding and
(ii) receipt by the Trustees of an Opinion of Counsel to the effect that such
amendment or the exercise of any power granted to the Trustees in accordance
with such amendment will not affect the Trust's status as a grantor trust for
federal income tax purposes or the Trust's exemption from regulation as an
"investment company" under the Investment Company Act of 1940, as amended.
41
<PAGE>
(c) In addition to and notwithstanding any other provision in this
Trust Agreement, without the consent of each affected Securityholder (such
consent being obtained in accordance with Section 6.03 or 6.06 hereof), this
Trust Agreement may not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely affect the amount of
any Distribution required to be made in respect of the Trust Securities as of a
specified date or (ii) restrict the right of a Securityholder to institute suit
for the enforcement of any such payment on or after such date; notwithstanding
any other provision herein without the unanimous consent of the Securityholders
(such consent being obtained in accordance with Section 6.03 or 6.06 hereof),
paragraph (b) of this Section 10.02 may not be amended.
(d) Notwithstanding any other provisions of this Trust Agreement, no
Trustee shall enter into or consent to any amendment to this Trust Agreement
which would cause the Trust to fail or cease to qualify for the exemption from
regulation as an "investment company" under the Investment Company Act of 1940,
as amended.
(e) Notwithstanding anything in this Trust Agreement to the contrary,
without the consent of the Depositor, this Trust Agreement may not be amended in
a manner which imposes any additional obligation on the Depositor.
(f) In the event that any amendment to this Trust Agreement is made,
the Administrative Trustees shall promptly provide to the Depositor a copy of
such amendment.
Section 10.03. Separability. In case any provision in this Trust
------------
Agreement or in the Trust Securities Certificates shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
SECTION 10.04. GOVERNING LAW. THIS TRUST AGREEMENT AND THE RIGHTS
-------------
AND OBLIGATIONS OF EACH OF THE SECURITYHOLDERS, THE TRUST AND THE TRUSTEES WITH
RESPECT TO THIS TRUST AGREEMENT AND THE TRUST SECURITIES SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF DELAWARE.
Section 10.05. Payments Due on Non-Business Day. If the date fixed
--------------------------------
for any payment on any Trust Security shall be a day which is not a Business
Day, then such payment need not be made on such date but may be made on the next
succeeding day which is a Business Day (except as otherwise provided in Section
4.01(a)), with the same force and effect as though made on the date fixed for
such payment, and no interest shall accrue thereon for the period after such
date.
Section 10.06. Successors. This Trust Agreement shall be binding
----------
upon and shall inure to the benefit of any successor to the Trust or the
Relevant Trustee or both, including any successor by operation of law.
42
<PAGE>
Section 10.07. Headings. The Article and Section headings are for
--------
convenience only and shall not affect the construction of this Trust Agreement.
Section 10.08. Reports, Notices and Demands. Any report, notice,
----------------------------
demand or other communication which by any provision of this Trust Agreement is
required or permitted to be given or served to or upon any Securityholder or the
Depositor may be given or served in writing by deposit thereof, first-class
postage prepaid, in the United States mail, hand delivery or facsimile
transmission, in each case, addressed, (a) in the case of a Preferred
Securityholder, to such Preferred Securityholder as such Securityholder's name
and address may appear on the Securities Register; and (b) in the case of the
Common Securityholder or the Depositor, to Pacific Gas and Electric Company,
P.O. Box 770000, 77 Beale Street, San Francisco, California 94177, Attention:
Treasurer, facsimile no.: (415) 973-7059. Any notice to Preferred
Securityholders shall also be given to such owners as have, within two years
preceding the giving of such notice, filed their names and addresses with the
Property Trustee for that purpose. Such notice, demand or other communication to
or upon a Securityholder shall be deemed to have been sufficiently given or
made, for all purposes, upon hand delivery, mailing or transmission.
Any notice, demand or other communication which by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
the Trust, the Property Trustee or the Administrative Trustees shall be given in
writing addressed (until another address is published by the Trust) as follows:
(a) with respect to the Property Trustee to The First National Bank of Chicago,
One First National Plaza, Suite 0126, Chicago, Illinois 60670-0126, Attention:
Corporate Trust Services Division; (b) with respect to the Delaware Trustee, to
Michael J. Majchrzak, c/o FCC National Bank, 300 King Street, Wilmington,
Delaware 19801; and (c) with respect to the Administrative Trustees, to them at
the address above for notices to the Depositor, marked "Attention:
Administrative Trustees of PG&E Capital I c/o Treasury Department." Such
notice, demand or other communication to or upon the Trust or the Property
Trustee shall be deemed to have been sufficiently given or made only upon actual
receipt of the writing by the Trust or the Property Trustee.
Section 10.09. Agreement Not to Petition. Each of the Trustees and
-------------------------
the Depositor agree for the benefit of the Securityholders that, until at least
one year and one day after the Trust has been terminated in accordance with
Article IX, they shall not file, or join in the filing of, a petition against
the Trust under any bankruptcy, reorganization, arrangement, insolvency,
liquidation or other similar law (including, without limitation, the United
States Bankruptcy Code) (collectively, "Bankruptcy Laws") or otherwise join in
the commencement of any proceeding against the Trust under any Bankruptcy Law.
In the event the Depositor takes action in violation of this Section 10.09, the
Property Trustee agrees, for the benefit of Securityholders, that at the expense
of the Depositor, it shall file an answer with the bankruptcy court or otherwise
properly contest the filing of such petition by the Depositor against the Trust
or the commencement of such action and raise the defense that the Depositor has
agreed in writing not to take such action and should be stopped and precluded
therefrom and such other defenses, if any, as counsel for the Trustee or the
Trust may assert. The provisions of this Section 10.09 shall survive the
termination of this Trust Agreement.
43
<PAGE>
Section 10.10. Trust Indenture Act; Conflict with Trust Indenture
--------------------------------------------------
Act.
---
(a) This Trust Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Trust Agreement and shall, to
the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a trustee
for the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts with
another provision hereof which is required to be included in this Trust
Agreement by any of the provisions of the Trust Indenture Act, such required
provision shall control. If any provision of this Trust Agreement modifies or
excludes any provision of the Trust Indenture Act which may be so modified or
excluded, the latter provision shall be deemed to apply to this Trust Agreement
as so modified or to be excluded, as the case may be.
(d) The application of the Trust Indenture Act to this Trust
Agreement shall not affect the nature of the Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
Section 10.11. Acceptance of Terms of Trust Agreement, Guarantee and
-----------------------------------------------------
Indenture.
---------
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY OR ON
BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE OR
FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE
BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST
SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND AGREEMENT
TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND THE
INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH SECURITYHOLDER
AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT SHALL BE
BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND SUCH SECURITYHOLDER
AND SUCH OTHERS.
PACIFIC GAS AND ELECTRIC COMPANY
By:_____________________________
Name:
Title:
44
<PAGE>
THE FIRST NATIONAL BANK OF
CHICAGO as Property Trustee
By:_____________________________
Name:
Title:
MICHAEL J. MAJCHRZAK,
as Delaware Trustee
________________________________
GABRIEL B. TOGNERI,
as Administrative Trustee
________________________________
LESLIE GULIASI,
as Administrative Trustee
________________________________
KATHLEEN RUEGER,
as Administrative Trustee
________________________________
45
<PAGE>
EXHIBIT A
CERTIFICATE OF TRUST
OF
PG&E CAPITAL I
THIS CERTIFICATE OF TRUST of PG&E Capital I (the "Trust"), dated
August 14, 1995, is being duly executed and filed by the undersigned, as
trustees, to form a business trust under the Delaware Business Trust Act (12
Del. C. (S) 3801 et seq.).
(i) Name. The name of the business trust being formed hereby is
PG&E Capital I.
(ii) Delaware Trustee. The name and business address of the trustee
of the Trust with a principal place of business in the State of Delaware are
Michael J. Majchrzak, c/o FCC National Bank, 300 King Street, Wilmington,
Delaware 19801.
(iii) Counterparts. This Certificate of Trust may be executed in one
or more counterparts, all of which together shall constitute one and the same
instrument.
(iv) Effective Date. This Certificate of Trust shall be effective
as of its filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have executed this Certificate of Trust as of the date first above written.
THE FIRST NATIONAL BANK OF
CHICAGO, as Trustee
________________________________ By:_________________________________
Gabriel B. Togneri, as Trustee Name: John R. Prendiville
Title: Vice President
________________________________ ___________________________________
Leslie Guliasi, as Trustee Michael J. Majchrzak, as Trustee
________________________________
Alan H. Lindstrom, Trustee
A-1
<PAGE>
EXHIBIT B
_____ ___, 1995
The Depository Trust Company,
55 Water Street, 49th Floor,
New York, New York 10041-0099.
Attention: ________________________
General Counsel's Office
Re: PG&E Capital I Preferred Securities
-----------------------------------
Ladies and Gentlemen:
The purpose of this letter is to set forth certain matters relating to
the issuance and deposit with The Depository Trust Company ("DTC") of the PG&E
Capital I ___% Cumulative Quarterly Income Preferred Securities, Series A (the
"Preferred Securities"), of PG&E Capital Trust I, a Delaware business trust (the
"Issuer"), formed pursuant to a Trust Agreement between Pacific Gas and Electric
Company ("PG&E"), The First National Bank of Chicago, as Property Trustee, the
Delaware Trustee and the Administrative Trustees named therein. The payment of
distributions on the Preferred Securities to the extent the Issuer has funds
available for the payment thereof, and payments due upon liquidation of Issuer
or redemption of the Preferred Securities are guaranteed by PG&E to the extent
set forth in a Guarantee Agreement dated ________ ___, 1995 by PG&E with respect
to the Preferred Securities. PG&E and the Issuer propose to sell the Preferred
Securities to certain Underwriters (the "Underwriters") pursuant to an
Underwriting Agreement dated ________ ___, 1995 by and among the Underwriters,
the Issuer and PG&E dated ________ ___, 1995, and the Underwriters wish to take
delivery of the Preferred Securities through DTC. First National Bank of
Chicago is acting as transfer agent and registrar with respect to the Preferred
Securities (the "Transfer Agent and Registrar").
To induce DTC to accept the Preferred Securities as eligible for
deposit at DTC, and to act in accordance with DTC's rules with respect to the
Preferred Securities, the Issuer, the Transfer Agent and Registrar and DTC agree
among each other as follows:
B-1
<PAGE>
1. Prior to the closing of the sale of the Preferred Securities to
the Underwriters, which is expected to occur on or about ________ ___, 1995,
there shall be deposited with DTC one or more global certificates (individually
and collectively, the "Global Certificate") registered in the name of DTC's
nominee, Cede & Co., representing an aggregate of _________ Preferred Securities
and bearing the following legend:
Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to
Issuer or its agent for registration of transfer, exchange, or
payment, and any certificate issued is registered in the name of Cede
& Co. or in such other name as is requested by an authorized
representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
2. The Amended and Restated Trust Agreement of the Issuer provides
for the voting by holders of the Preferred Securities under certain limited
circumstances. The Issuer shall establish a record date for such purposes and
shall, to the extent possible, give DTC notice of such record date not less than
15 calendar days in advance of such record date.
3. In the event of a stock split, conversion, recapitalization,
reorganization or any other similar transaction resulting in the cancellation of
all or any part of the Preferred Securities outstanding, the Issuer or the
Transfer Agent and Registrar shall send DTC a notice of such event at least 5
business days prior to the effective date of such event.
4. In the event of distribution on, or an offering or issuance of
rights with respect to, the Preferred Securities outstanding, the Issuer or the
Transfer Agent and Registrar shall send DTC a notice specifying: (a) the amount
of and conditions, if any, applicable to the payment of any such distribution or
any such offering or issuance of rights; (b) any applicable expiration or
deadline date, or any date by which any action on the part of the holders of
Preferred Securities is required; and (c) the date any required notice is to be
mailed by or on behalf of the Issuer to holders of Preferred Securities or
published by or on behalf of the Issuer (whether by mail or publication, the
"Publication Date"). Such notice shall be sent to DTC by a secure means (e.g.,
- -
legible telecopy, registered or certified mail, overnight delivery) in a timely
manner designed to assure that such notice is in DTC's possession no later than
the close of business on the business day before the Publication Date. The
Issuer or the Transfer Agent and Registrar will forward such notice either in a
separate secure transmission for each CUSIP number or in a secure transmission
of multiple CUSIP numbers (if applicable) that includes a manifest or list of
each CUSIP number submitted in that transmission. (The party sending such
notice shall have a method to verify subsequently the use of such means and the
timeliness of such notice.) The Publication Date shall be not less than 30
calendar days nor more than 60 calendar days prior to the payment of any such
distribution or any such offering or issuance of rights with respect to the
Preferred Securities. After establishing the amount of payment to be made on
the Preferred Securities, the Issuer or
B-2
<PAGE>
the Transfer Agent and Registrar will notify DTC's Dividend Department of such
payment 5 business days prior to payment date. Notices to DTC's Dividend
Department by telecopy shall be sent to (212) 709-1723. Such notices by mail or
by any other means shall be sent to:
Manager, Announcements
Dividend Department
The Depository Trust Company
7 Hanover Square, 23rd Floor
New York, New York 10004-2695
The Issuer or the Transfer Agent and Registrar shall confirm DTC's
receipt of such telecopy by telephoning the Dividend Department at
(212) 709-1270.
5. In the event of a redemption by the Issuer of the Preferred
Securities, notice specifying the terms of the redemption and the Publication
Date of such notice shall be sent by the Issuer or the Transfer Agent and
Registrar to DTC not less than 30 calendar days prior to such event by a secure
means in the manner set forth in paragraph 4. Such redemption notice shall be
sent to DTC's Call Notification Department at (516) 227-4164 or (516) 227-4190,
and receipt of such notice shall be confirmed by telephoning (516) 227-4070.
Notice by mail or by any other means shall be sent to:
Call Notification Department
The Depository Trust Company
711 Stewart Avenue
Garden City, New York 11530-4719
6. In the event of any invitation to tender the Preferred
Securities, notice specifying the terms of the tender and the Publication Date
of such notice shall be sent by the Issuer or the Transfer Agent and Registrar
to DTC by a secure means and in a timely manner as described in paragraph 4.
Notices to DTC pursuant to this paragraph and notices of other corporate actions
(including mandatory tenders, exchanges and capital changes), shall be sent,
unless notification to another department is expressly provided for herein, by
telecopy to DTC's Reorganization Department at (212) 709-1093 or (212) 709-1094
and receipt of such notice shall be confirmed by telephoning (212) 709-6884, or
by mail or any other means to:
Manager, Reorganization Department
Reorganization Window
The Depository Trust Company
7 Hanover Square, 23rd Floor
New York, New York 10004-2695
7. All notices and payment advices sent to DTC shall contain the
CUSIP number or numbers of the Preferred Securities and the accompanying
designation of the Preferred Securities, which, as of the date of this letter,
is "PG&E Capital I ___% Cumulative Quarterly Income Preferred Securities, Series
A".
B-3
<PAGE>
8. Distribution payments or other cash payments with respect to the
Preferred Securities evidenced by the Global Certificate shall be received by
Cede & Co., as nominee of DTC, or its registered assigns in next day funds on
each payment date (or in accordance with existing arrangements between the
Issuer or the Transfer Agent and Registrar and DTC). Such payments shall be
made payable to the order of Cede & Co., and shall be addressed as follows:
NDFS Redemption Department
The Depository Trust Company
7 Hanover Square, 23rd Floor
New York, New York 10004-2695
9. DTC may by prior written notice direct the Issuer and the
Transfer Agent and Registrar to use any other telecopy number or address of DTC
as the number or address to which notices or payments may be sent.
10. In the event of a conversion, redemption, or any other similar
transaction (e.g., tender made and accepted in response to the Issuer's or the
- -
Transfer Agent and Registrar's invitation) necessitating a reduction in the
aggregate number of Preferred Securities outstanding evidenced by the Global
Certificate, DTC, in its discretion: (a) may request the Issuer or the Transfer
Agent and Registrar to issue and countersign a new Global certificate; or (b)
may make an appropriate notation on the Global Certificate indicating the date
and amount of such reduction.
11. DTC may discontinue its services as a securities depositary with
respect to the Preferred Securities at any time by giving at least 90 days'
prior written notice to the Issuer and the Transfer Agent and Registrar (at
which time DTC will confirm with the Issuer or the Transfer Agent and Registrar
the aggregate number of Preferred Securities deposited with it) and discharging
its responsibilities with respect thereto under applicable law. Under such
circumstances, the Issuer may determine to make alternative arrangements for
book-entry settlement for the Preferred Securities, make available one or more
separate global certificates evidencing Preferred Securities to any Participant
having Preferred Securities credited to its DTC account, or issue definitive
Preferred Securities to the beneficial holders thereof, and in any such case,
DTC agrees to cooperate fully with the Issuer and the Transfer Agent and
Registrar and to return the Global certificate, duly endorsed for transfer as
directed by the Issuer or the Transfer Agent and Registrar, together with any
other documents of transfer reasonably requested by the Issuer or the Transfer
Agent and Registrar.
12. In the event that the Issuer determines that beneficial owners of
Preferred Securities shall be able to obtain definitive Preferred Securities,
the Issuer or the Transfer Agent and Registrar shall notify DTC of the
availability of certificates. In such event, the Issuer or the Transfer Agent
and Registrar shall issue, transfer and exchange certificates in appropriate
amounts, as required by DTC and others, and DTC agrees to cooperate fully with
the Issuer and the Transfer Agent and Registrar and to return the Global
Certificate, duly endorsed for transfer as directed by the Issuer or the
Transfer Agent and Registrar, together with any other documents of transfer
reasonably requested by the Issuer or the Transfer Agent and Registrar.
B-4
<PAGE>
13. This letter may be executed in any number of counterparts, each
of which when so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
B-5
<PAGE>
Nothing herein shall be deemed to require the Transfer Agent and
Registrar to advance funds on behalf of PG&E Capital I.
Very truly yours,
PG&E CAPITAL I
(As Issuer)
By: [Name of Trustee]
Administrative Trustee
By___________________________________
Name:
Title:
THE FIRST NATIONAL BANK OF
CHICAGO,
(As Transfer Agent and Registrar)
By__________________________________
Name:
Title:
RECEIVED AND ACCEPTED:
THE DEPOSITORY TRUST COMPANY
By___________________________
Authorized Officer
B-6
<PAGE>
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE
Certificate Number Number of Common Securities
C-1
Certificate Evidencing Common Securities
of
PG&E Capital I
___% Common Securities
(liquidation amount $25 per Common Security)
PG&E Capital I, a statutory business trust formed under the laws of
the State of Delaware (the "Trust"), hereby certifies that Pacific Gas and
Electric Company (the "Holder") is the registered owner of _____ (_____) common
securities of the Trust representing undivided beneficial interests in the
assets of the Trust and designated the ___% Common Securities (liquidation
amount $25 per Common Security) (the "Common Securities"). In accordance with
Section 5.10 of the Trust Agreement (as defined below) the Common Securities are
not transferable and any attempted transfer hereof shall be void. The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities are set forth in, and this certificate and
the Common Securities represented hereby are issued and shall in all respects be
subject to the terms and provisions of, the Amended and Restated Trust Agreement
of the Trust dated as of _______ ___, 1995, as the same may be amended from time
to time (the "Trust Agreement") including the designation of the terms of the
Common Securities as set forth therein. The Trust will furnish a copy of the
Trust Agreement to the Holder without charge upon written request to the Trust
at its principal place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, one of the Administrative Trustees of the Trust
has executed this certificate this ____ day of _________, 1995.
PG&E CAPITAL I
By:__________________________________
Name:
Administrative Trustee
C-1
<PAGE>
EXHIBIT D
AGREEMENT AS TO EXPENSES AND LIABILITIES
AGREEMENT dated as of ________ ___, 1995, between Pacific Gas and
Electric Company, a California corporation ("PG&E"), and PG&E Capital I, a
Delaware business trust (the "Trust").
WHEREAS, the Trust intends to issue its Common Securities (the "Common
Securities") to and receive Debentures from PG&E and to issue and sell ___%
Cumulative Quarterly Income Preferred Securities, Series A (the "Preferred
Securities") with such powers, preferences and special rights and restrictions
as are set forth in the Amended and Restated Trust Agreement of the Trust dated
as of __________, 1995 as the same may be amended from time to time (the "Trust
Agreement");
WHEREAS, PG&E will directly or indirectly own all of the Common
Securities of Trust and will issue the Debentures;
NOW, THEREFORE, in consideration of the purchase by each holder of the
Preferred Securities, which purchase PG&E hereby agrees shall benefit PG&E and
which purchase PG&E acknowledges will be made in reliance upon the execution and
delivery of this Agreement, PG&E and Trust hereby agree as follows:
ARTICLE I
Section 1.01. Guarantee by PG&E. Subject to the terms and conditions
-----------------
hereof, PG&E hereby irrevocably and unconditionally guarantees to each person or
entity to whom the Trust is now or hereafter becomes indebted or liable (the
"Beneficiaries") the full payment, when and as due, of any and all Obligations
(as hereinafter defined) to such Beneficiaries. As used herein, "Obligations"
means any costs, expenses or liabilities of the Trust, other than obligations of
the Trust to pay to holders of any Preferred Securities or other similar
interests in the Trust the amounts due such holders pursuant to the terms of the
Preferred Securities or such other similar interests, as the case may be. This
Agreement is intended to be for the benefit of, and to be enforceable by, all
such Beneficiaries, whether or not such Beneficiaries have received notice
hereof.
Section 1.02. Term of Agreement. This Agreement shall terminate and
-----------------
be of no further force and effect upon the later of (a) the date on which full
payment has been made of all amounts payable to all holders of all the Preferred
Securities (whether upon redemption, liquidation, exchange or otherwise) and (b)
the date on which there are no Beneficiaries remaining; provided, however, that
this Agreement shall continue to be effective or shall be reinstated, as the
case may be, if at any time any holder of Preferred Securities or any
Beneficiary must restore payment of any sums paid under the Preferred
Securities, under any Obligation, under the Guarantee Agreement dated the date
hereof by PG&E and The First National Bank of Chicago as guarantee trustee or
under this Agreement for any reason whatsoever. This Agreement is continuing,
irrevocable, unconditional and absolute.
D-1
<PAGE>
Section 1.03. Waiver of Notice. PG&E hereby waives notice of
----------------
acceptance of this Agreement and of any Obligation to which it applies or may
apply, and PG&E hereby waives presentment, demand for payment, protest, notice
of nonpayment, notice of dishonor, notice of redemption and all other notices
and demands.
Section 1.04. No Impairment. The obligations, covenants, agreements
-------------
and duties of PG&E under this Agreement shall in no way be affected or impaired
by reason of the happening from time to time of any of the following:
(a) the extension of time for the payment by the Trust of all or any
portion of the Obligations or for the performance of any other obligation under,
arising out of, or in connection with, the Obligations;
(b) any failure, omission, delay or lack of diligence on the part of
the Beneficiaries to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Beneficiaries with respect to the Obligations or any
action on the part of the Trust granting indulgence or extension of any kind; or
(c) the voluntary or involuntary liquidation, dissolution, sale of
any collateral, receivership, insolvency, bankruptcy, assignment for the benefit
of creditors, reorganization, arrangement, composition or readjustment of debt
or, or other similar proceedings affecting, the Trust or any of the assets of
the Trust.
There shall be no obligation of the Beneficiaries to give notice to, or obtain
the consent of, PG&E with respect to the happening of any of the foregoing.
Section 1.05. Enforcement. A Beneficiary may enforce this Agreement
-----------
directly against PG&E and PG&E waives any right or remedy to require that any
action be brought against the Trust or any other person or entity before
proceeding against PG&E.
ARTICLE II
Section 2.01. Binding Effect. All guarantees and agreements
--------------
contained in this Agreement shall bind the successors, assigns, receivers,
trustees and representatives of PG&E and shall inure to the benefit of the
Beneficiaries.
Section 2.02. Amendment. So long as there remains any Beneficiary or
---------
any Preferred Securities of any series are outstanding, this Agreement shall not
be modified or amended in any manner adverse to such Beneficiary or to the
holders of the Preferred Securities.
Section 2.03. Notices. Any notice, request or other communication
-------
required or permitted to be given hereunder shall be given in writing by
delivering the same against receipt therefor by facsimile transmission
(confirmed by mail), telex or by registered or certified mail, addressed as
follows (and if so given, shall be deemed given when mailed or upon receipt of
an answer-back, if sent by telex):
D-2
<PAGE>
PG&E Capital I
c/o The First National Bank of Chicago
One First National Plaza
Suite 0126
Chicago, Illinois 60670-0126
Facsimile No.: (312)407-4656
Attention: Corporate Trust Secvices Division
Pacific Gas and Electric Company
77 Beale Street
P.O. Box 770000
San Francisco, California 94120
Facsimile No.: (415)973-7000
Attention: Treasurer
Section 2.04 THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
THIS AGREEMENT is executed as of the day and year first above written.
PACIFIC GAS AND ELECTRIC COMPANY
By:_____________________________
Name:
Title:
PG&E CAPITAL I
By:_____________________________
Name:
Administrative Trustee
D-3
<PAGE>
EXHIBIT E
IF THE PREFERRED SECURITY IS TO BE A GLOBAL CERTIFICATE INSERT - This
Preferred Security is a Global Certificate within the meaning of the Trust
Agreement hereinafter referred to and is registered in the name of The
Depository Trust Company (the "Depository") or a nominee of the Depository.
This Preferred Security is exchangeable for Preferred Securities registered in
the name of a person other than the Depository or its nominee only in the
limited circumstances described in the Trust Agreement and no transfer of this
Preferred Security (other than a transfer of this Preferred Security as a whole
by the Depository to a nominee of the Depository or by a nominee of the
Depository to the Depository or another nominee of the Depository) may be
registered except in limited circumstances.
Unless this Preferred Security is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New York) to
Pacific Gas and Electric Financing Trust I or its agent for registration of
transfer, exchange or payment, and any Preferred Security issued is registered
in the name of Cede & Co. or such other name as requested by an authorized
representative of The Depository Trust Company and any payment hereon is made to
Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A
PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an
interest herein.
Certificate Number Number of Preferred Securities
P-
CUSIP NO.
Certificate Evidencing Preferred Securities
of
PG&E Capital I
___% Cumulative Quarterly Income Preferred Securities,
Series A
(liquidation amount $25 per Preferred Security)
PG&E Capital I, a statutory business trust formed under the laws of
the State of Delaware (the "Trust"), hereby certifies that ____________ (the
"Holder") is the registered owner of _____ (_____) preferred securities of the
Trust representing an undivided beneficial interest in the assets of the Trust
and designated the PG&E Capital I ___% Cumulative Quarterly Income Preferred
Securities, Series A (liquidation amount $25 per Preferred Security) (the
"Preferred Securities"). The Preferred Securities are transferable on the books
and records of the Trust, in person or by a duly authorized attorney, upon
surrender of this certificate duly endorsed and in proper form for transfer as
provided in Section 5.04 of the Trust Agreement (as defined below). The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Preferred Securities are set forth in, and this certificate
and the Preferred Securities represented hereby are issued and
E-1
<PAGE>
shall in all respects be subject to the terms and provisions of, the Amended and
Restated Trust Agreement of the Trust dated as of _______ ___, 1995, as the same
may be amended from time to time (the "Trust Agreement") including the
designation of the terms of Preferred Securities as set forth therein. The
Holder is entitled to the benefits of the Guarantee Agreement entered into by
Pacific Gas and Electric Company, a California corporation, and The First
National Bank of Chicago as guarantee trustee, dated as of _______ ___, 1995
(the "Guarantee") to the extent provided therein. The Trust will furnish a copy
of the Trust Agreement and the Guarantee to the Holder without charge upon
written request to the Trust at its principal place of business or registered
office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, one of the Administrative Trustees of the Trust
has executed this certificate this ____ day of _________, 1995.
PG&E CAPITAL I
By:_________________________________
Name:
Administrative Trustee
E-2
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security to:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
agent to transfer this Preferred Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.
Date:_______________
Signature:_________________________
(Sign exactly as your name appears on the other side of this Preferred Security
Certificate)
E-3
<PAGE>
EXHIBIT 4-3
================================================================================
PACIFIC GAS AND ELECTRIC COMPANY
TO
THE FIRST NATIONAL BANK OF CHICAGO
Trustee
--------------
Indenture
Dated as of ..................., 1995
--------------
================================================================================
<PAGE>
PACIFIC GAS AND ELECTRIC COMPANY
Certain Sections of this Indenture relating to Sections 310 through 318,
inclusive, of the Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
Trust Indenture
Act Section Indenture Section
<S> <C>
(S) 310(a)(1) ........................................... 609
(a)(2) ........................................... 609
(a)(3) ........................................... Not Applicable
(a)(4) ........................................... Not Applicable
(b) ........................................... 608
610
(S) 311(a) ........................................... 613
(b) ........................................... 613
(S) 312(a) ........................................... 701
702
(b) ........................................... 702
(c) ........................................... 702
(S) 313(a) ........................................... 703
(b) ........................................... 703
(c) ........................................... 703
(d) ........................................... 703
(S) 314(a) ........................................... 704
(a)(4) ........................................... 101
1004
(b) ........................................... Not Applicable
(c)(1) ........................................... 102
(c)(2) ........................................... 102
(c)(3) ........................................... Not Applicable
(d) ........................................... Not Applicable
(e) ........................................... 102
(S) 315(a) ........................................... 601
(b) ........................................... 602
(c) ........................................... 601
(d) ........................................... 601
(e) ........................................... 514
(S) 316(a) ........................................... 101
(a)(1)(A)........................................... 502
512
(a)(1)(B)........................................... 513
(a)(2) ........................................... Not Applicable
(b) ........................................... 508
(c) ........................................... 104
(S) 317(a)(1) ........................................... 503
(a)(2) ........................................... 504
(b) ........................................... 1003
(S) 318(a) ........................................... 107
</TABLE>
___________________
Note: This reconciliation and tie sheet shall not, for any purpose, be deemed
to be a part of the Indenture.
<PAGE>
TABLE OF CONTENTS
__________
Recitals of the Company............................................. 1
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions............................................ 1
Act........................................................... 2
Additional Interest........................................... 2
Affiliate..................................................... 2
control....................................................... 2
Authenticating Agent.......................................... 2
Board of Directors............................................ 2
Board Resolution.............................................. 2
Business Day.................................................. 2
Commission.................................................... 2
Common Security............................................... 2
Company....................................................... 3
Company Request............................................... 3
Company Order................................................. 3
Corporate Trust Office........................................ 3
corporation................................................... 3
Defaulted Interest............................................ 3
Depositary.................................................... 3
Event of Default.............................................. 3
Exchange Act.................................................. 3
Extension Period.............................................. 3
Global Security............................................... 3
Guarantee..................................................... 3
Holder........................................................ 3
Indenture..................................................... 3
interest...................................................... 4
Interest Payment Date......................................... 4
Maturity...................................................... 4
Notice of Default............................................. 4
Officers' Certificate......................................... 4
Opinion of Counsel............................................ 4
Original Issue Discount Security.............................. 4
Outstanding................................................... 4
Paying Agent.................................................. 5
Person........................................................ 5
Place of Payment.............................................. 5
Predecessor Security.......................................... 5
-i-
<PAGE>
Preferred Securities.......................................... 5
Redemption Date............................................... 6
Redemption Price.............................................. 6
Regular Record Date........................................... 6
Responsible Officer........................................... 6
Securities.................................................... 6
Securities Act................................................ 6
Security Register" and "Security Registrar.................... 6
Senior Indebtedness........................................... 6
Special Record Date........................................... 6
Stated Maturity............................................... 7
Subsidiary.................................................... 7
Trust Agreement............................................... 7
Trust Indenture Act........................................... 7
Trustee....................................................... 7
U.S. Government Obligations................................... 7
Vice President................................................ 7
Section 102. Compliance Certificates and Opinions................... 8
Section 103. Form of Documents Delivered to Trustee................. 8
Section 104. Acts of Holders; Record Dates.......................... 9
Section 105. Notices, Etc., to Trustee and Company.................. 10
Section 106. Notice to Holders; Waiver.............................. 10
Section 107. Conflict with Trust Indenture Act...................... 11
Section 108. Effect of Headings and Table of Contents............... 11
Section 109. Successors and Assigns................................. 11
Section 110. Separability Clause.................................... 11
Section 111. Benefits of Indenture.................................. 11
Section 112. Governing Law.......................................... 11
Section 113. Legal Holidays......................................... 12
-ii-
<PAGE>
ARTICLE TWO
Security Forms
Section 201. Forms Generally.......................................... 12
Section 202. Form of Legend for Global Securities..................... 12
Section 203. Form of Trustee's Certificate of Authentication.......... 13
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series...................... 13
Section 302. Denominations............................................. 16
Section 303. Execution, Authentication, Delivery and Dating............ 16
Section 304. Temporary Securities...................................... 17
Section 305. Registration; Registration of Transfer and Exchange....... 18
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.......... 20
Section 307. Payment of Interest; Interest Rights Preserved............ 21
Section 308. Persons Deemed Owners..................................... 22
Section 309. Cancellation.............................................. 22
Section 310. Computation of Interest................................... 22
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture................... 23
Section 402. Application of Trust Money................................ 24
-iii-
<PAGE>
ARTICLE FIVE
Remedies
Section 501. Events of Default......................................... 24
Section 502. Acceleration of Maturity; Rescission
and Annulment............................................. 25
Section 503. Collection of Indebtedness and Suits
for Enforcement by Trustee................................ 26
Section 504. Trustee May File Proofs of Claim.......................... 27
Section 505. Trustee May Enforce Claims Without
Possession of Securities.................................. 28
Section 506. Application of Money Collected............................ 28
Section 507. Limitation on Suits....................................... 28
Section 508. Unconditional Right of Holders to Receive
Interest Principal, Premium and .......................... 29
Section 509. Restoration of Rights and Remedies........................ 29
Section 510. Rights and Remedies Cumulative............................ 29
Section 511. Delay or Omission Not Waiver.............................. 30
Section 512. Control by Holders........................................ 30
Section 513. Waiver of Past Defaults................................... 30
Section 514. Undertaking for Costs..................................... 31
Section 515. Waiver of Stay or Extension Laws.......................... 31
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities....................... 31
Section 602. Notice of Defaults........................................ 31
Section 603. Certain Rights of Trustee................................. 32
-iv-
<PAGE>
Section 604. Not Responsible for Recitals or Issuance of Securities.... 33
Section 605. May Hold Securities....................................... 33
Section 606. Money Held in Trust....................................... 33
Section 607. Compensation and Reimbursement............................ 34
Section 608. Conflicting Interests..................................... 34
Section 609. Corporate Trustee Required; Eligibility................... 34
Section 610. Resignation and Removal; Appointment of Successor......... 35
Section 611. Acceptance of Appointment by Successor.................... 36
Section 612. Merger, Conversion, Consolidation or Succession to
Business.................................................. 37
Section 613. Preferential Collection of Claims Against Company......... 38
Section 614. Appointment of Authenticating Agent....................... 38
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and Addresses of Holders. 39
Section 702. Preservation of Information; Communications to Holders.... 40
Section 703. Reports by Trustee........................................ 40
Section 704. Reports by Company........................................ 40
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only on Certain Terms...... 41
Section 802. Successor Substituted..................................... 42
-v-
<PAGE>
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders........ 42
Section 902. Supplemental Indentures With Consent of Holders........... 43
Section 903. Execution of Supplemental Indentures...................... 44
Section 904. Effect of Supplemental Indentures......................... 44
Section 905. Conformity with Trust Indenture Act....................... 45
Section 906. Reference in Securities to Supplemental Indentures........ 45
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest............... 45
Section 1002. Maintenance of Office or Agency.......................... 45
Section 1003. Money for Securities Payments to Be Held in Trust........ 46
Section 1004. Statement by Officers as to Default...................... 47
Section 1005. Additional Covenants..................................... 47
Section 1006. Waiver of Certain Covenants.............................. 48
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article................................. 48
Section 1102. Election to Redeem; Notice to Trustee.................... 48
Section 1103. Selection by Trustee of Securities to Be Redeemed........ 49
Section 1104. Notice of Redemption..................................... 50
-vi-
<PAGE>
Section 1105. Deposit of Redemption Price.............................. 50
Section 1106. Securities Payable on Redemption Date.................... 50
Section 1107. Securities Redeemed in Part.............................. 51
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article................................. 51
Section 1202. Satisfaction of Sinking Fund Payments with Securities.... 52
Section 1203. Redemption of Securities for Sinking Fund................ 52
ARTICLE THIRTEEN
Subordination of Securities
Section 1301. Securities Subordinate to Senior Indebtedness........... 52
Section 1302. Default on Senior Indebtedness.......................... 53
Section 1303. Liquidation; Dissolution; Bankruptcy.................... 53
Section 1304. Subrogation............................................. 54
Section 1305. Notice by the Company................................... 55
Section 1306. Notice by The Company................................... 56
Section 1307. Rights of the Trustee; Holders of Senior Indebtedness... 56
Section 1308. Subordination May Not be Impaired....................... 57
Testimonium ........................................................... 58
Signatures and Seals................................................... 58
-vii-
<PAGE>
INDENTURE, dated as of ................, 1995, between PACIFIC GAS AND
ELECTRIC COMPANY, a corporation duly organized and existing under the laws of
the State of California (herein called the "Company"), having its principal
office at 77 Beale Street, P.O. Box 770000, San Francisco, California 94177, and
THE FIRST NATIONAL BANK OF CHICAGO, a national banking association duly
organized and existing under the laws of the United States, as Trustee (herein
called the "Trustee").
Recitals of the Company
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its junior
subordinated debentures (herein called the "Securities"), to be issued in one or
more series to evidence the loans to be made to the Company of the proceeds from
the issuance from time to time by one or more business trusts (each a "Trust"
and, collectively, the "Trusts") of preferred trust interests in such Trusts
(the "Preferred Securities") and common trust interests in such Trusts (the
"Common Securities").
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
Now, Therefore, This Indenture Witnesseth:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles;
<PAGE>
(4) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may
be, of this Indenture; and
(5) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"Act", when used with respect to any Holder, has the meaning specified in
Section 104.
"Additional Interest" has the meaning specified in Section 301.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authenticating Agent" means any Person authorized by the Trustee pursuant
to Section 614 to act on behalf of the Trustee to authenticate Securities of one
or more series.
"Board of Directors" means either the board of directors of the Company or
any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Company to have been duly adopted by the Board
of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day" means a day other than (a) a Saturday or Sunday, (b) a day
on which banking institutions in The City of New York are authorized or
obligated by law or executive order to remain closed, or (c) a day on which the
Corporate Trust Office is closed for business.
"Commission" means the Securities and Exchange Commission, from time to
time constituted, created under the Exchange Act, or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common Security" has the meaning stated in the first recital of this
Indenture.
-2-
<PAGE>
"Company" means the Person named as the "Company" in the first paragraph
of this instrument until a successor Person shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its President or a Vice President, and by its Treasurer,
an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered
to the Trustee.
"Corporate Trust Office" means the principal office of the Trustee in
Chicago, Illinois at which at any particular time its corporate trust business
shall be administered.
"corporation" means a corporation, association, company, joint-stock
company or business trust.
"Defaulted Interest" has the meaning specified in Section 307.
"Depositary" means, with respect to Securities of any series issuable in
whole or in part in the form of one or more Global Securities, a clearing agency
registered under the Exchange Act that is designated to act as Depositary for
such Securities as contemplated by Section 301.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934 and any statute
successor thereto, in each case as amended from time to time.
"Extension Period" has the meaning specified in Section 301.
"Global Security" means a Security that evidences all or part of the
Securities of any series and bears the legend set forth in Section 202 (or such
legend as may be specified as contemplated by Section 301 for such Securities).
"Guarantee" means any guarantee that the Company may enter into with a
Trust for the benefit of holders of Preferred Securities of such Trust.
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indenture" means this instrument as originally executed and as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the terms of particular
series of Securities established as contemplated by Section 301.
-3-
<PAGE>
"interest", when used with respect to an Original Issue Discount Security
which by its terms bears interest only after Maturity, means interest payable
after Maturity.
"Interest Payment Date", when used with respect to any Security, means the
Stated Maturity of an instalment of interest on such Security.
"Maturity", when used with respect to any Security, means the date on
which the principal of such Security or an instalment of principal becomes due
and payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption or otherwise.
"Notice of Default" means a written notice of the kind specified in
Section 501(4).
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, a Vice Chairman of the Board, the President or a Vice President, and by
the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary,
of the Company, and delivered to the Trustee. One of the officers signing an
Officers' Certificate given pursuant to Section 1004 shall be the principal
executive, financial or accounting officer of the Company.
"Opinion of Counsel" means a written opinion of legal counsel, who may be
legal counsel for the Company, and who shall be acceptable to the Trustee.
"Original Issue Discount Security" means any Security which provides for
an amount less than the principal amount thereof to be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section 502.
"Outstanding", when used with respect to Securities, means, as of the date
of determination, all Securities theretofore authenticated and delivered under
this Indenture, except:
(1) Securities theretofore cancelled by the Trustee or delivered to
the Trustee for cancellation;
(2) Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated in trust by the
Company (if the Company shall act as its own Paying Agent) for the Holders of
such Securities; provided that, if such Securities are to be redeemed, notice
of such redemption has been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee has been made; and
(3) Securities which have been paid pursuant to Section 306 or in
exchange for or in lieu of which other Securities have been authenticated and
delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such
-4-
<PAGE>
Securities are held by a bona fide purchaser in whose hands such Securities
are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder as of any date, (A) the principal amount of an Original Issue
Discount Security which shall be deemed to be Outstanding shall be the amount of
the principal thereof which would be due and payable as of such date upon
acceleration of the Maturity thereof to such date pursuant to Section 502, (B)
the principal amount of a Security denominated in one or more foreign currencies
or currency units which shall be deemed to be Outstanding shall be the U.S.
dollar equivalent, determined as of such date in the manner provided as
contemplated by Section 301, of the principal amount of such Security (or, in
the case of a Security described in Clause (A) above, of the amount determined
as provided in such Clause), and (C) Securities owned by the Company or any
other obligor upon the Securities or any Affiliate of the Company or of such
other obligor (other than a Trust to which such Securities have been issued)
shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent, waiver or other
action, only Securities which the Trustee knows to be so owned shall be so
disregarded. Securities so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company or any other obligor upon the Securities or any
Affiliate of the Company or of such other obligor (other than a Trust to which
such Securities have been issued).
"Paying Agent" means any Person authorized by the Company to pay the
principal of or any premium or interest on any Securities on behalf of the
Company.
"Person" means any individual, corporation, partnership, joint venture,
trust, limited liability company or corporation, unincorporated organization or
government or any agency or political subdivision thereof.
"Place of Payment", when used with respect to the Securities of any
series, means the place or places where the principal of and any premium and
interest on the Securities of that series are payable as specified as
contemplated by Section 301.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Preferred Securities" has the meaning stated in the first recital of this
Indenture.
-5-
<PAGE>
"Redemption Date", when used with respect to any Security to be redeemed,
means the date fixed for such redemption by or pursuant to this Indenture.
"Redemption Price", when used with respect to any Security to be redeemed,
means the price at which it is to be redeemed pursuant to this Indenture.
"Regular Record Date" for the interest payable on any Interest Payment
Date on the Securities of any series means the date specified for that purpose
as contemplated by Section 301.
"Responsible Officer", when used with respect to the Trustee, means the
chairman or any vice-chairman of the board of directors, the chairman or any
vice-chairman of the executive committee of the board of directors, the chairman
of the trust committee, the president, any vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any trust officer or assistant trust officer, the controller
or any assistant controller or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Securities" has the meaning stated in the first recital of this Indenture
and more particularly means any Securities authenticated and delivered under
this Indenture.
"Securities Act" means the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time.
"Security Register" and "Security Registrar" have the respective meanings
specified in Section 305.
"Senior Indebtedness" means (i) the principal of and premium (if any) in
respect of (A) indebtedness of the Company for money borrowed and (B)
indebtedness evidenced by securities, debentures, bonds or other similar
instruments issued by the Company; (ii) all capital lease obligations of the
Company; (iii) all obligations of the Company issued or assumed as the deferred
purchase price of property, all conditional sale obligations of the Company and
all obligations of the Company under any title retention agreement (but
excluding trade accounts payable arising in the ordinary course of business);
(iv) certain obligations of the Company for the reimbursement of any obligor on
any letter of credit, banker's acceptance, security purchase facility, surety
bond or similar credit transaction entered into in the ordinary course of
business of the Company; (v) all obligations of the type referred to in clauses
(i) through (iv) of other persons and all dividends of other persons (other than
Preferred Securities) for the payment of which, in either case, the Company is
responsible or liable as obligor, guarantor or otherwise; and (vi) all
obligations of the type referred to in clauses (i) through (v) of other persons
secured by any lien on any property or asset of the Company (whether or not such
obligation is assumed by the Company), except for any such indebtedness that is
by its terms subordinated to or pari passu with the Securities.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 307.
-6-
<PAGE>
"Stated Maturity", when used with respect to any Security or any
instalment of principal thereof or interest thereon, means the date specified in
such Security as the fixed date on which the principal of such Security or such
instalment of principal or interest is due and payable.
"Subsidiary" means, at any time, a corporation more than 50% of the
outstanding voting stock of which is owned, directly or indirectly, at such time
by the Company or by one or more other Subsidiaries, or by the Company and one
or more other Subsidiaries. For the purposes of this definition, "voting stock"
means stock which ordinarily has voting power for the election of directors,
whether at all times or only so long as no senior class of stock has such voting
power by reason of any contingency.
"Trust Agreement" means any agreement establishing a Trust, as the same
may be amended, modified, supplemented or restated.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first paragraph
of this instrument until a successor Trustee shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Trustee" shall mean
or include each Person who is then a Trustee hereunder, and if at any time there
is more than one such Person, "Trustee" as used with respect to the Securities
of any series shall mean the Trustee with respect to Securities of that series.
"U.S. Government Obligations", means securities that are (x) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (y) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act of 1933, as amended) as custodian with respect to any such
U.S. Government Obligation or a specific payment of principal of or interest on
any such U.S. Government Obligation held by such custodian for the account of
the holder of such depository receipt, provided that (except as required by law)
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depository receipt from any amount received by the
custodian in respect of the U.S. Government Obligation or the specific payment
of principal of or interest on the U.S. Government Obligation evidenced by such
depository receipt.
"Vice President", when used with respect to the Company or the Trustee,
means any vice president, whether or not designated by a number or a word or
words added before or after the title "vice president".
-7-
<PAGE>
Section 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of
an Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirements set forth in
this Indenture.
Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture shall include,
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
Section 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
-8-
<PAGE>
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect
to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 104. Acts of Holders; Record Dates.
Any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Indenture to be given, made or
taken by Holders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Holders in person or by agent
duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee and, where it is hereby expressly
required, to the Company. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as
the "Act" of the Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Indenture and (subject to Section
601) conclusive in favor of the Trustee and the Company, if made in the
manner provided in this Section.
The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or
by a certificate of a notary public or other officer authorized by law to
take acknowledgments of deeds, certifying that the individual signing such
instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient
proof of his authority. The fact and date of the execution of any such
instrument or writing, or the authority of the Person executing the same, may
also be proved in any other manner which the Trustee deems sufficient.
The Company may, in the circumstances permitted by the Trust Indenture
Act, fix any day as the record date for the purpose of determining the
Holders entitled to give or take any request, demand, authorization,
direction, notice, consent, waiver or other action, or to vote on any action,
authorized or permitted to be given or taken by Holders. If not set by the
Company prior to the first solicitation of a Holder made by any Person in
respect of any such action, or, in the case of any such vote, prior to such
vote, the record date for any such action or vote shall be the 30th day (or,
if later, the date of the most recent lists of Holders required to be
provided pursuant to Section 701) prior to such first solicitation or vote,
as the case may be. With regard to any record date, only the Holders on such
date (or their duly designated proxies) shall be entitled to give or take, or
vote on, the relevant action.
The ownership of Securities shall be proved by the Security Register.
-9-
<PAGE>
Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Security shall bind every future Holder of
the same Security and the Holder of every Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee or
the Company in reliance thereon, whether or not notation of such action is
made upon such Security.
Section 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture
to be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing
to or with the Trustee at its Corporate Trust Office, Attention:
................., or
(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to the Company
addressed to it at the address of its principal office specified in the
first paragraph of this instrument or at any other address previously
furnished in writing to the Trustee by the Company.
Section 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to each
Holder affected by such event, at his address as it appears in the Security
Register, not later than the latest date (if any), and not earlier than the
earliest date (if any), prescribed for the giving of such notice. In any
case where notice to Holders is given by mail, neither the failure to mail
such notice, nor any defect in any notice so mailed, to any particular Holder
shall affect the sufficiency of such notice with respect to other Holders.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the
Trustee shall constitute a sufficient notification for every purpose
hereunder.
-10-
<PAGE>
Section 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a provision
of the Trust Indenture Act which is required under such Act to be a part of
and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act which may be so modified or excluded, the latter provision
shall be deemed to apply to this Indenture as so modified or to be excluded,
as the case may be.
Section 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
Section 110. Separability Clause.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
Section 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder, the holders of Senior Indebtedness and the Holders, any benefit or
any legal or equitable right, remedy or claim under this Indenture.
Section 112. Governing Law.
This Indenture and the Securities shall be governed by and construed in
accordance with the law of the State of California without regard to the
conflict of law principles thereof.
-11-
<PAGE>
Section 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day, then (notwithstanding
any other provision of this Indenture or of the Securities (other than a
provision of any Security which specifically states that such provision shall
apply in lieu of this Section)) payment of interest or principal (and
premium, if any) need not be made on such date, but may be made on the next
succeeding Business Day (except that, if such Business Day is in the next
succeeding calendar year, such Interest Payment Date, Redemption Date or
Stated Maturity, as the case may be, shall be the immediately preceding
Business Day) with the same force and effect as though made on the Interest
Payment Date or Redemption Date, or at the Stated Maturity, and no interest
shall accrue thereon for the period after such date.
ARTICLE TWO
SECURITY FORMS
Section 201. Forms Generally.
The Securities of each series shall be in substantially the form
established by or pursuant to a Board Resolution or in one or more indentures
supplemental hereto, in each case with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by
this Indenture, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange or Depositary
therefor or as may, consistently herewith, be determined by the officers
executing such Securities, as evidenced by their execution thereof. If the
form of Securities of any series is established by action taken pursuant to a
Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Company Order
contemplated by Section 303 for the authentication and delivery of such
Securities.
The definitive Securities shall be printed, lithographed or engraved on
steel engraved borders or may be produced in any other manner, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
Section 202. Form of Legend for Global Securities.
Unless otherwise specified as contemplated by Section 301 for the
Securities evidenced thereby, every Global Security authenticated and
delivered hereunder shall bear a legend in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART
-12-
<PAGE>
FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN
PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY
OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.
Section 203. Form of Trustee's Certificate of Authentication.
The Trustee's certificates of authentication shall be in substantially
the following form:
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
THE FIRST NATIONAL BANK OF CHICAGO,
As Trustee
By................................
Authorized Officer
ARTICLE THREE
THE SECURITIES
Section 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be authenticated
and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to Section 303,
set forth, or determined in the manner provided, in an Officers' Certificate,
or established in one or more indentures supplemental hereto, prior to the
issuance of Securities of any series,
(1) the title of the Securities of the series (which shall distinguish
the Securities of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the Securities of
the series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Section 304, 305, 306, 906 or 1107 and except for any
Securities which, pursuant to Section 303, are deemed never to have been
authenticated and delivered hereunder);
-13-
<PAGE>
(3) the Person to whom any interest on a Security of the series shall be
payable, if other than the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest;
(4) the date or dates on which the principal of any Securities of the
series is payable;
(5) the rate or rates at which any Securities of the series shall bear
interest, if any, the extent to which additional interest amounts
("Additional Interest"), if any, shall be payable in respect of any
Securities of such series, the date or dates from which any such interest
shall accrue, the Interest Payment Dates on which any such interest shall be
payable, the Regular Record Date for any such interest payable on any
Interest Payment Date and the right, if any, of the Company to extend the
interest payment periods and the duration of such extension (an "Extension
Period");
(6) the place or places where the principal of and any premium and
interest on any Securities of the series shall be payable;
(7) the period or periods within which, the price or prices at which and
the terms and conditions upon which any Securities of the series may be
redeemed, in whole or in part, at the option of the Company and, if other
than by a Board Resolution, the manner in which any election by the Company
to redeem the Securities shall be evidenced;
(8) the obligation, if any, of the Company to redeem or purchase any
Securities of the series pursuant to any sinking fund or analogous provisions
or at the option of the Holder thereof and the period or periods within
which, the price or prices at which and the terms and conditions upon which
any Securities of the series shall be redeemed or purchased, in whole or in
part, pursuant to such obligation;
(9) if other than denominations of $25.00 and any integral multiple
thereof, the denominations in which any Securities of the series shall be
issuable;
(10) if the amount of principal of or any premium or interest on any
Securities of the series may be determined with reference to an index or
pursuant to a formula, the manner in which such amounts shall be determined;
(11) if other than the currency of the United States of America, the
currency, currencies or currency units in which the principal of or any
premium or interest on any Securities of the series shall be payable and the
manner of determining the equivalent thereof in the currency of the United
States of America for any purpose, including for purposes of the definition
of "Outstanding" in Section 101;
(12) if the principal of or any premium or interest on any Securities of
the series is to be payable, at the election of the Company or the Holder
thereof, in one
-14-
<PAGE>
or more currencies or currency units other than that or those in which such
Securities are stated to be payable, the currency, currencies or currency
units in which the principal of or any premium or interest on such Securities
as to which such election is made shall be payable, the periods within which
and the terms and conditions upon which such election is to be made and the
amount so payable (or the manner in which such amount shall be determined);
(13) if other than the entire principal amount thereof, the portion of
the principal amount of any Securities of the series which shall be payable
upon declaration of acceleration of the Maturity thereof pursuant to Section
502;
(14) if applicable, that any Securities of the series shall be issuable
in whole or in part in the form of one or more Global Securities and, in such
case, the respective Depositaries for such Global Securities, the form of any
legend or legends which shall be borne by any such Global Security in
addition to or in lieu of that set forth in Section 204 and any circumstances
in addition to or in lieu of those set forth in Clause (2) of the last
paragraph of Section 305 in which any such Global Security may be exchanged
in whole or in part for Securities registered, and any transfer of such
Global Security in whole or in part may be registered, in the name or names
of Persons other than the Depositary for such Global Security or a nominee
thereof;
(15) any addition to or change in the Events of Default which applies to
any Securities of the series and any change in the right of the Trustee or
the requisite Holders of such Securities to declare the principal amount
thereof due and payable pursuant to Section 502;
(16) any addition to or change in the covenants set forth in Article Ten
which applies to Securities of the series; and
(17) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture, except as permitted by
Section 901(5)).
All Securities of any one series shall be substantially identical except
as to denomination and except as may otherwise be provided in or pursuant to the
Board Resolution referred to above and (subject to Section 303) set forth, or
determined in the manner provided, in the Officers' Certificate referred to
above or in any such indenture supplemental hereto.
If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such action
shall be certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
The Securities shall be subordinated in right of payment to Senior
Indebtedness as provided in Article Thirteen.
-15-
<PAGE>
Section 302. Denominations.
The Securities of each series shall be issuable only in registered form
without coupons and only in such denominations as shall be specified as
contemplated by Section 301. In the absence of any such specified denomination
with respect to the Securities of any series, the Securities of such series
shall be issuable in denominations of $25.00 and any integral multiple thereof.
Section 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its Chairman
of the Board, its Vice Chairman of the Board, its President or one of its Vice
Presidents, under its corporate seal reproduced thereon, attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities, and the Trustee in accordance
with the Company Order shall authenticate and deliver such Securities. If the
form or terms of the Securities of the series have been established by or
pursuant to one or more Board Resolutions as permitted by Sections 201 and 301,
in authenticating such Securities, and accepting the additional responsibilities
under this Indenture in relation to such Securities, the Trustee shall be
entitled to receive, and (subject to Section 601) shall be fully protected in
relying upon, an Opinion of Counsel stating,
(1) if the form of such Securities has been established by or pursuant to
Board Resolution as permitted by Section 201, that such form has been
established in conformity with the provisions of this Indenture;
(2) if the terms of such Securities have been established by or pursuant
to Board Resolution as permitted by Section 301, that such terms have been
established in conformity with the provisions of this Indenture; and
(3) that such Securities, when authenticated and delivered by the Trustee
and issued by the Company in the manner and subject to any conditions
specified in such Opinion of Counsel, will constitute valid and legally
binding obligations of the Company enforceable in accordance with their
terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of
-16-
<PAGE>
general applicability relating to or affecting creditors' rights and to
general equity principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the preceding
paragraph, if all Securities of a series are not to be originally issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 301 or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the
authentication of each Security of such series if such documents are delivered
at or prior to the authentication upon original issuance of the first Security
of such series to be issued.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder. Notwithstanding the
foregoing, if any Security shall have been authenticated and delivered hereunder
but never issued and sold by the Company, and the Company shall deliver such
Security to the Trustee for cancellation as provided in Section 309, for all
purposes of this Indenture such Security shall be deemed never to have been
authenticated and delivered hereunder and shall never be entitled to the
benefits of this Indenture.
Section 304. Temporary Securities.
Pending the preparation of definitive Securities of any series, the
Company may execute, and upon Company Order the Trustee shall authenticate and
deliver, temporary Securities which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company will cause
definitive Securities of that series to be prepared without unreasonable delay.
After the preparation of definitive Securities of such series, the temporary
Securities of such series shall be exchangeable for definitive Securities of
such series upon surrender of the temporary Securities of such series at the
office or agency of the Company in a Place of Payment for that series, without
charge to the Holder. Upon surrender for cancellation
-17-
<PAGE>
of any one or more temporary Securities of any series, the Company shall execute
and the Trustee shall authenticate and deliver in exchange therefor one or more
definitive Securities of the same series, of any authorized denominations and of
like tenor and aggregate principal amount. Until so exchanged, the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of such series and tenor.
Section 305. Registration; Registration of Transfer and Exchange.
The Company shall maintain or cause to be maintained an office or agency
where the Securities may be presented for registration of transfer or for
exchange ("Security Registrar"). The Security Registrar shall keep a register
(the register maintained in such office and in any other office or agency of the
Company in a Place of Payment being herein sometimes collectively referred to as
the "Security Register") in which, subject to such reasonable regulations as it
may prescribe, the Company shall provide for the registration of Securities and
of transfers of Securities. The Security Registrar shall initially be kept at
the Corporate Trust Office of the Trustee in Chicago, Illinois, and the Trustee
is hereby appointed Security Registrar for the purpose of registering Securities
and transfers of Securities as herein provided. The Company shall give prompt
written notice to the Trustee of any change of location of such office or
agency. If at any time the Company shall fail to maintain or cause to be
maintained any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations may be made or served at
the Corporate Trust Office of the Trustee and the Trustee shall act as Security
Registrar and shall be entitled to appropriate compensation therefor. The
Company or any Affiliate of the Company may act as Security Registrar or co-
Registrar.
Upon surrender for registration of transfer of any Security of a series at
the office or agency of the Company in a Place of Payment for that series, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
the same series, of any authorized denominations and of like tenor and aggregate
principal amount.
At the option of the Holder, Securities of any series may be exchanged for
other Securities of the same series, of any authorized denominations and of like
tenor and aggregate principal amount, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to
receive.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
-18-
<PAGE>
Every Security presented or surrendered for registration of transfer or
for exchange shall (if so required by the Company or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities, other than
exchanges pursuant to Section 304, 906 or 1107 not involving any transfer.
If the Securities of any series (or of any series and specified tenor) are
to be redeemed in part, the Company shall not be required (A) to issue, register
the transfer of or exchange any Securities of that series (or of that series and
specified tenor, as the case may be) during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of any
such Securities selected for redemption under Section 1103 and ending at the
close of business on the day of such mailing, or (B) to register the transfer of
or exchange any Security so selected for redemption in whole or in part, except
the unredeemed portion of any Security being redeemed in part.
The provisions of Clauses (1), (2), (3) and (4) below shall apply only to
Global Securities:
(1) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depositary designated for such Global Security
or a nominee thereof and delivered to such Depositary or a nominee thereof or
custodian therefor, and each such Global Security shall constitute a single
Security for all purposes of this Indenture.
(2) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and
no transfer of a Global Security in whole or in part may be registered, in
the name of any Person other than the Depositary for such Global Security or
a nominee thereof unless (A) such Depositary (i) has notified the Company
that it is unwilling or unable to continue as Depositary for such Global
Security or (ii) has ceased to be a clearing agency registered under the
Exchange Act at a time when the Depositary is required to be so registered to
act as such Depositary, (B) there shall have occurred and be continuing an
Event of Default with respect to such Global Security, (C) the Company in its
sole discretion determines that such Global Security shall be so
exchangeable, or (D) there shall exist such circumstances, if any, in
addition to or in lieu of the foregoing as have been specified for this
purpose as contemplated by Section 301.
(3) Subject to Clause (2) above, any exchange of a Global Security for
other Securities may be made in whole or in part, and all Securities issued
in exchange for
-19-
<PAGE>
a Global Security or any portion thereof shall be registered in such names as
the Depositary for such Global Security shall direct.
(4) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any
portion thereof, whether pursuant to this Section, Section 304, 306, 906 or
1107 or otherwise, shall be authenticated and delivered in the form of, and
shall be, a Global Security, unless such Security is registered in the name
of a Person other than the Depositary for such Global Security or a nominee
thereof.
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i) evidence
to their satisfaction of the destruction, loss or theft of any Security and
(ii) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice
to the Company or the Trustee that such Security has been acquired by a bona
fide purchaser, the Company shall execute and the Trustee shall authenticate
and deliver, in lieu of any such destroyed, lost or stolen Security, a new
Security of the same series and of like tenor and principal amount and
bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected
therewith.
Every new Security of any series issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the
destroyed, lost or stolen Security shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally
and proportionately with any and all other Securities of that series duly
issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
-20-
<PAGE>
Section 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301 with
respect to any series of Securities, interest on any Security which is
payable, and is punctually paid or duly provided for, on any Interest Payment
Date shall be paid to the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest.
Any interest on any Security of any series which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the
Holder on the relevant Regular Record Date by virtue of having been such
Holder, and such Defaulted Interest may be paid by the Company, at its
election in each case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Securities of such series (or their
respective Predecessor Securities) are registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid
on each Security of such series and the date of the proposed payment, and
at the same time the Company shall deposit with the Trustee an amount of
money equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the Trustee
for such deposit prior to the date of the proposed payment, such money
when deposited to be held in trust for the benefit of the Persons entitled
to such Defaulted Interest as in this Clause provided. Thereupon the
Trustee shall fix a Special Record Date for the payment of such Defaulted
Interest which shall be not more than 15 days and not less than 10 days
prior to the date of the proposed payment and not less than 10 days after
the receipt by the Trustee of the notice of the proposed payment. The
Trustee shall promptly notify the Company of such Special Record Date and,
in the name and at the expense of the Company, shall cause notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefor to be given to each Holder of Securities of such series in the
manner set forth in Section 106, not less than 10 days prior to such
Special Record Date. Notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor having been so mailed, such
Defaulted Interest shall be paid to the Persons in whose names the
Securities of such series (or their respective Predecessor Securities) are
registered at the close of business on such Special Record Date and shall
no longer be payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with
the requirements of any securities exchange on which such Securities may
be listed, and upon such notice as may be required by such exchange, if,
after notice
-21-
<PAGE>
given by the Company to the Trustee of the proposed payment pursuant to
this Clause, such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.
Section 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name such Security is registered as the owner of such Security
for the purpose of receiving payment of principal of and any premium and
(subject to Section 307) any interest on such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
Section 309. Cancellation.
All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly cancelled by it. The Company may at any time deliver to
the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Company may have acquired in any manner
whatsoever, and may deliver to the Trustee (or to any other Person for delivery
to the Trustee) for cancellation any Securities previously authenticated
hereunder which the Company has not issued and sold, and all Securities so
delivered shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as provided
in this Section, except as expressly permitted by this Indenture. All cancelled
Securities held by the Trustee shall be disposed of as directed by a Company
Order.
Section 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for
Securities of any series, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.
-22-
<PAGE>
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of
Securities herein expressly provided for), and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other than
(i) Securities which have been destroyed, lost or stolen and which have
been replaced or paid as provided in Section 306 and (ii) Securities for
whose payment money or U.S. Government Obligations has theretofore been
deposited in trust or segregated and held in trust by the Company and
thereafter repaid to the Company or discharged from such trust, as
provided in Section 1003) have been delivered to the Trustee for
cancellation; or
(B) all such Securities not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within
one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of (i), (ii) or (iii) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for the
purpose money or U.S. Government Obligations, sufficient in the opinion of
a nationally recognized firm of independent public accountants expressed
in a written certification thereof delivered to the Trustee, to pay and
discharge the entire indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation, for principal and any premium
and interest to the date of such deposit (in the case of Securities which
have become due and payable) or to the Stated Maturity or Redemption Date,
as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
-23-
<PAGE>
(3) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture
have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607, the obligations of
the Trustee to any Authenticating Agent under Section 614 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of Clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
Section 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
ARTICLE FIVE
Remedies
Section 501. Events of Default.
"Event of Default", wherever used herein with respect to Securities of any
series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be occasioned by the provisions of Article
Thirteen or be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(1) default in the payment of any interest (including any Additional
Interest) upon any Security of that series when it becomes due and payable,
and continuance of such default for a period of 30 days; or
(2) default in the payment of the principal of or any premium on any
Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as due by
the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or warranty of
the Company in this Indenture (other than a covenant or warranty a default in
whose
-24-
<PAGE>
performance or whose breach is elsewhere in this Section specifically dealt
with or which has expressly been included in this Indenture solely for the
benefit of a series of Securities other than that series), and continuance of
such default or breach for a period of 90 days after there has been given, by
registered or certified mail, to the Company by the Trustee or to the Company
and the Trustee by the Holders of at least 25% in principal amount of the
Outstanding Securities of that series a written notice specifying such
default or breach and requiring it to be remedied and stating that such
notice is a "Notice of Default" hereunder; or
(5) the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Company in an involuntary case
or proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in
respect of the Company under any applicable Federal or State law, or
appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator
or other similar official of the Company or of any substantial part of its
property, or ordering the winding up or liquidation of its affairs, and the
continuance of any such decree or order for relief or any such other decree
or order unstayed and in effect for a period of 90 consecutive days; or
(6) the commencement by the Company of a voluntary case or proceeding
under any applicable Federal or State bankruptcy, insolvency, reorganization
or other similar law or of any other case or proceeding to be adjudicated a
bankrupt or insolvent, or the consent by it to the entry of a decree or order
for relief in respect of the Company in an involuntary case or proceeding
under any applicable Federal or State bankruptcy, insolvency, reorganization
or other similar law or to the commencement of any bankruptcy or insolvency
case or proceeding against it, or the filing by it of a petition or answer or
consent seeking reorganization or relief under any applicable Federal or
State law, or the consent by it to the filing of such petition or to the
appointment of or taking possession by a custodian, receiver, liquidator,
assignee, trustee, sequestrator or other similar official of the Company or
of any substantial part of its property, or the making by it of an assignment
for the benefit of creditors, or the admission by it in writing of its
inability to pay its debts generally as they become due, or the taking of
corporate action by the Company in furtherance of any such action; or
(7) any other Event of Default provided with respect to Securities of that
series.
Section 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default with respect to Securities of any series at the
time Outstanding occurs and is continuing, then in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series may declare the principal amount of all
the Securities of that series (or, if any Securities of
-25-
<PAGE>
that series are Original Issue Discount Securities, such portion of the
principal amount of such Securities as may be specified by the terms thereof)
to be due and payable immediately, by a notice in writing to the Company (and
to the Trustee if given by Holders), and upon any such declaration such
principal amount (or specified amount) shall become immediately due and
payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in
this Article provided, the Holders of a majority in principal amount of the
Outstanding Securities of that series, by written notice to the Company and
the Trustee, may rescind and annul such declaration and its consequences if
(1) the Company has paid or deposited with the Trustee a sum sufficient
to pay
(A) all overdue interest (including any Additional Interest) on all
Securities of that series,
(B) the principal of (and premium, if any, on) any Securities of
that series which have become due otherwise than by such declaration of
acceleration and any interest thereon at the rate or rates prescribed
therefor in such Securities,
(C) to the extent that payment of such interest is lawful, interest
upon overdue interest at the rate or rates prescribed therefor in such
Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel;
and
(2) all Events of Default with respect to Securities of that series,
other than the non-payment of the principal of Securities of that series
which have become due solely by such declaration of acceleration, have
been cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 503. Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Company covenants that if
(1) default is made in the payment of any interest (including any
Additional Interest) on any Security when such interest becomes due and
payable and such default continues for a period of 30 days, or
-26-
<PAGE>
(2) default is made in the payment of the principal of (or premium, if
any, on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal and any premium and interest (including any Additional
Interest to the extent that payment of such Additional Interest shall be legally
enforceable) and interest on any overdue principal and premium, at the rate or
rates prescribed therefor in such Securities, and, in addition thereto, such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series occurs and
is continuing, the Trustee may in its discretion proceed to protect and enforce
its rights and the rights of the Holders of Securities of such series by such
appropriate judicial proceedings, including a proceeding to obtain a judgment in
the Trustee's name and as Trustee under the Indenture, as the Trustee shall deem
most effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Company (or any other
obligor upon the Securities), its property or its creditors, the Trustee shall
be entitled and empowered, by intervention in such proceeding or otherwise, to
take any and all actions authorized under the Trust Indenture Act in order to
have claims of the Holders and the Trustee allowed in any such proceeding. In
particular, the Trustee shall be authorized to collect and receive any moneys or
other property payable or deliverable on any such claims and to distribute the
same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator
or other similar official in any such judicial proceeding is hereby authorized
by each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 607.
No provision of this Indenture shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding; provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors' or
other similar committee.
-27-
<PAGE>
Section 505. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities may
be prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, be for the ratable benefit of
the Holders of the Securities in respect of which such judgment has been
recovered.
Section 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal or any premium
or interest (including any Additional Interest), upon presentation of the
Securities and the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid:
First: To the payment of all amounts due the Trustee under Section 607;
and
Second: Subject to Article Thirteen, to the payment of the amounts then
due and unpaid for principal of and any premium and interest (including any
Additional Interest) on the Securities in respect of which or for the benefit
of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such
Securities for principal and any premium and interest (including any
Additional Interest), respectively.
Section 507. Limitation on Suits.
No Holder of any Security of any series shall have any right to institute
any proceeding, judicial or otherwise, with respect to this Indenture, or for
the appointment of a receiver or trustee, or for any other remedy hereunder,
unless
(1) such Holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to the Securities of that series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series shall have made written request to the
Trustee to institute proceedings in respect of such Event of Default in its
own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
-28-
<PAGE>
(4) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given to
the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
Section 508. Unconditional Right of Holders to Receive Principal, Premium and
Interest.
Notwithstanding any other provision in this Indenture, the Holder of any
Security shall have the right, which is absolute and unconditional, to receive
payment of the principal of and any premium and (subject to Section 307)
interest (including any Additional Interest) on such Security on the respective
Stated Maturities expressed in such Security (or, in the case of redemption, on
the Redemption Date) and to institute suit for the enforcement of any such
payment, and such rights shall not be impaired without the consent of such
Holder.
Section 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to the Trustee or
to such Holder, then and in every such case, subject to any determination in
such proceeding, the Company, the Trustee and the Holders shall be restored
severally and respectively to their former positions hereunder and thereafter
all rights and remedies of the Trustee and the Holders shall continue as though
no such proceeding had been instituted.
Section 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities in the last paragraph of Section
306, no right or remedy herein conferred upon or reserved to the Trustee or to
the Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise.
-29-
<PAGE>
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
Section 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Securities to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.
Section 512. Control by Holders.
The Holders of a majority in principal amount of the Outstanding
Securities of any series shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee, with respect to the
Securities of such series, provided that
(1) such direction shall not be in conflict with any rule of law or with
this Indenture, and
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all the
Securities of such series waive any past default hereunder with respect to such
series and its consequences, except a default
(1) in the payment of the principal of or any premium or interest
(including any Additional Interest) on any Security of such series, or
(2) in respect of a covenant or provision hereof which under Article Nine
cannot be modified or amended without the consent of the Holder of each
Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
-30-
<PAGE>
Section 514. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, a court may require any party litigant in such suit to
file an undertaking to pay the costs of such suit, and may assess costs against
any such party litigant, in the manner and to the extent provided in the Trust
Indenture Act; provided that neither this Section nor the Trust Indenture Act
shall be deemed to authorize any court to require such an undertaking or to make
such an assessment in any suit instituted by the Company.
Section 515. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided by the
Trust Indenture Act and as specifically set forth in this Indenture.
Notwithstanding the foregoing, no provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the exercise
of any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it. Whether or not therein expressly
so provided, every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section. Nothing in this Indenture shall be
construed to release the Trustee from liability for its own negligent action,
its own negligent failure to act, or its own willful misconduct.
Section 602. Notice of Defaults.
If a default occurs hereunder with respect to Securities of any series,
the Trustee shall give the Holders of Securities of such series notice of such
default as and
-31-
<PAGE>
to the extent provided by the Trust Indenture Act; provided, however, that in
the case of any default of the character specified in Section 501(4) with
respect to Securities of such series, no such notice to Holders shall be given
until at least 30 days after the occurrence thereof. For the purpose of this
Section, the term "default" means any event which is, or after notice or lapse
of time or both would become, an Event of Default with respect to Securities of
such series.
Section 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(1) the Trustee may rely and shall be protected in acting or refraining
from acting in good faith upon any resolution, opinion of counsel,
certificate, written representation of a Holder or transferee, certificate of
auditors or any other certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order, and any
resolution of the Board of Directors shall be sufficiently evidenced by a
Board Resolution;
(3) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad faith
on its part, rely upon an Officers' Certificate;
(4) the Trustee may consult with counsel or other experts and the written
advice of such counsel or any Opinion of Counsel with respect to legal
matters or advice within the scope of such experts' area of expertise shall
be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance
thereon;
(5) the Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any
of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in compliance with
such request or direction;
(6) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
approval, bond, debenture, note, other evidence of indebtedness or other
paper or document, but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters
-32-
<PAGE>
as it may see fit, and, if the Trustee shall determine to make such further
inquiry or investigation, it shall be entitled upon prior reasonable notice
to examine during normal business hours the books, records and premises of
the Company, personally or by agent or attorney, provided that prior to such
examination the Trustee shall agree in writing to be bound by such reasonable
confidentiality obligations as the Company shall require; and
(7) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder.
Section 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of the Company,
and neither the Trustee nor any Authenticating Agent assumes any responsibility
for their correctness. The Trustee makes no representations as to the validity
or sufficiency of this Indenture or of the Securities. Neither the Trustee nor
any Authenticating Agent shall be accountable for the use or application by the
Company of Securities or the proceeds thereof.
Section 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
608 and 613, may otherwise deal with the Company with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Security
Registrar or such other agent.
Section 606. Money Held in Trust.
Money held by the Trustee in trust hereunder shall be segregated from
funds which the Trustee does not hold in trust but need not be segregated from
other funds held in trust except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed with the Company.
-33-
<PAGE>
Section 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time reasonable compensation for
all services rendered by it hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee of
an express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision of
this Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Trustee for, and to hold it harmless against, any
loss, damage, claims, liability, penalty or expense incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder, including the
costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder.
Section 608. Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture. To the extent
permitted by such Act, the Trustee shall not be deemed to have a conflicting
interest by virtue of being a trustee under this Indenture with respect to
Securities of more than one series.
Section 609. Corporate Trustee Required; Eligibility.
There shall at all times be one (and only one) Trustee hereunder with
respect to the Securities of each series, which may be Trustee hereunder for
Securities of one or more other series. Each Trustee shall be a Person that is
eligible pursuant to the Trust Indenture Act to act as such and has a combined
capital and surplus of at least $50,000,000, provided that at least one Trustee
shall be a corporation meeting the requirements of Section 310(c) of the Trust
Indenture Act. If any such Person publishes reports of condition at least
annually, pursuant to law or to the requirements of its supervising or examining
authority, then for the purposes of this Section and to the extent permitted by
the Trust Indenture Act, the combined capital and surplus of such Person shall
be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Trustee with respect to the
Securities of any series shall cease to be eligible in accordance with the
provisions of this Section,
-34-
<PAGE>
it shall resign immediately in the manner and with the effect hereinafter
specified in this Article.
Section 610. Resignation and Removal; Appointment of Successor.
No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 611.
The Trustee may resign at any time with respect to the Securities of
one or more series by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by Section 611 shall
not have been delivered to the Trustee within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition, at the
expense of the Company, any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Securities of such
series.
The Trustee may be removed at any time with respect to the Securities
of any series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and to the
Company.
If at any time:
(1) the Trustee shall fail to comply with Section 608 after written
request therefor by the Company or by any Holder who has been a bona fide
Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and shall
fail to resign after written request therefor by the Company or by any
such Holder, or
(3) the Trustee shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (A) the Company may remove the Trustee with respect
to all Securities, or (B) subject to Section 514, any Holder who has been a
bona fide Holder of a Security for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee with respect to all Securities
and the appointment of a successor Trustee or Trustees.
If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, with
respect to the Securities of one or more series, the Company shall promptly
appoint a successor Trustee or Trustees with respect to the Securities of
that or those series (it being understood that any such successor Trustee may
be appointed with respect to the Securities of one or more or all of such
series and that at any time there shall be only one Trustee with respect to
-35-
<PAGE>
the Securities of any particular series) and shall comply with the applicable
requirements of Section 611. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
with respect to the Securities of any series shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities of such
series delivered to the Company and the retiring Trustee, the successor Trustee
so appointed shall, forthwith upon its acceptance of such appointment in
accordance with the applicable requirements of Section 611, become the successor
Trustee with respect to the Securities of such series and to that extent
supersede the successor Trustee appointed by the Company. If no successor
Trustee with respect to the Securities of any series shall have been so
appointed by the Company or the Holders and accepted appointment in the manner
required by Section 611, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.
The Company shall give notice of each resignation and each removal of the
Trustee with respect to the Securities of any series and each appointment of a
successor Trustee with respect to the Securities of any series to all Holders of
Securities of such series in the manner provided in Section 106. Each notice
shall include the name of the successor Trustee with respect to the Securities
of such series and the address of its Corporate Trust Office.
Section 611. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee with respect
to all Securities, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on the request of the
Company or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to the successor Trustee all property and money
held by such retiring Trustee hereunder.
In case of the appointment hereunder of a successor Trustee with respect
to the Securities of one or more (but not all) series, the Company, the retiring
Trustee and each successor Trustee with respect to the Securities of one or more
series shall execute and deliver an indenture supplemental hereto wherein each
successor Trustee shall accept such appointment and which (1) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Trustee all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series to which
the appointment of such successor Trustee relates, (2) if the retiring Trustee
is not retiring with respect to all Securities, shall contain such provisions as
shall
-36-
<PAGE>
be deemed necessary or desirable to confirm that all the rights, powers, trusts
and duties of the retiring Trustee with respect to the Securities of that or
those series as to which the retiring Trustee is not retiring shall continue to
be vested in the retiring Trustee, and (3) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee; and upon
the execution and delivery of such supplemental indenture the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein and each such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of that or those series
to which the appointment of such successor Trustee relates; but, on request of
the Company or any successor Trustee, such retiring Trustee shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates.
Upon request of any such successor Trustee, the Company shall execute any
and all instruments for more fully and certainly vesting in and confirming to
such successor Trustee all such rights, powers and trusts referred to in the
first or second preceding paragraph, as the case may be.
No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article.
Section 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
-37-
<PAGE>
Section 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company (or
any other obligor upon the Securities), the Trustee shall be subject to and
shall take all actions necessary in order to comply with the provisions of the
Trust Indenture Act regarding the collection of claims against the Company (or
any such other obligor).
Section 614. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with respect to
one or more series of Securities which shall be authorized to act on behalf of
the Trustee to authenticate Securities of such series issued upon original issue
and upon exchange, registration of transfer or partial redemption thereof or
pursuant to Section 306, and Securities so authenticated shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by Federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
an Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and to the Company. Upon receiving such a notice
of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible
-38-
<PAGE>
in accordance with the provisions of this Section, the Trustee may appoint a
successor Authenticating Agent which shall be acceptable to the Company and
shall give notice of such appointment in the manner provided in Section 106 to
all Holders of Securities of the series with respect to which such
Authenticating Agent will serve. Any successor Authenticating Agent upon
acceptance of its appointment hereunder shall become vested with all the rights,
powers and duties of its predecessor hereunder, with like effect as if
originally named as an Authenticating Agent. No successor Authenticating Agent
shall be appointed unless eligible under the provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section, and the Trustee
shall be entitled to be reimbursed for such payments, subject to the provisions
of Section 607.
If an appointment with respect to one or more series is made pursuant to
this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternative
certificate of authentication in the following form:
This is one of the Securities of the series designated therein referred to
in the within-mentioned Indenture.
THE FIRST NATIONAL BANK OF CHICAGO
As Trustee
By...............................,
As Authenticating Agent
By................................
Authorized Officer
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee
(1) semi-annually, not later than 15 days after a Regular Record Date, a
list, in such form as the Trustee may reasonably require, of the names and
addresses of the Holders of Securities of each series as of the immediately
preceding Regular Record Date, and
-39-
<PAGE>
(2) at such other times as the Trustee may request in writing, within 30
days after the receipt by the Company of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such
list is furnished;
in each case to the extent such information is in the possession or control of
the Company, or any of its Paying Agents, and is not identical to a previously
supplied list or has not otherwise been received by the Trustee in its capacity
as Security Registrar.
Section 702. Preservation of Information; Communications to Holders.
The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 701 upon receipt of a new list so furnished.
The rights of Holders to communicate with other Holders with respect to
their rights under this Indenture or under the Securities, and the corresponding
rights and privileges of the Trustee, shall be as provided by the Trust
Indenture Act.
Every Holder of Securities, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company nor the Trustee nor any
agent of either of them shall be held accountable by reason of any disclosure of
information as to names and addresses of Holders made pursuant to the Trust
Indenture Act.
Section 703. Reports by Trustee.
The Trustee shall transmit to Holders such reports concerning the Trustee
and its actions under this Indenture as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant thereto.
A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when any Securities are listed on any stock exchange.
Section 704. Reports by Company.
The Company shall file with the Trustee and the Commission, and transmit
to Holders, such information, documents and other reports, and such summaries
thereof, as may be required pursuant to the Trust Indenture Act at the times and
in the manner provided pursuant to such Act; provided that any such information,
documents or reports required to be filed with the Commission pursuant to
Section 13 or 15(d) of the Exchange
-40-
<PAGE>
Act shall be filed with the Trustee within 15 days after the same is so required
to be filed with the Commission.
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person or
convey, transfer or lease its properties and assets substantially as an entirety
to any Person, and the Company shall not permit any Person to consolidate with
or merge into the Company or convey, transfer or lease its properties and assets
substantially as an entirety to the Company, unless:
(1) in case the Company shall consolidate with or merge into another
Person or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, the Person formed by such consolidation or into
which the Company is merged or the Person which acquires by conveyance or
transfer, or which leases, the properties and assets of the Company
substantially as an entirety shall be a corporation, partnership, trust or
other entity, shall be organized and validly existing under the laws of the
United States of America, any State thereof or the District of Columbia and
shall expressly assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the Trustee, the due and
punctual payment of the principal of and any premium and interest (including
any Additional Interest) on all the Securities and the performance or
observance of every covenant of this Indenture and any Guarantees on the part
of the Company to be performed or observed;
(2) immediately after giving effect to such transaction and treating any
indebtedness which becomes an obligation of the Company or a Subsidiary as a
result of such transaction as having been incurred by the Company or such
Subsidiary at the time of such transaction, no Event of Default, and no event
which, after notice or lapse of time or both, would become an Event of
Default, shall have happened and be continuing;
(3) such consolidation or merger or conveyance, transfer or lease of
properties or assets of the Company is permitted under each Trust Agreement
and each Guarantee and does not give rise to any breach or violation of, any
Trust Agreement or Guarantee; and
(4) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that such consolidation, merger,
conveyance, transfer or lease and, if a supplemental indenture is required in
connection with such transaction, such supplemental indenture comply with
this Article and that all conditions precedent herein provided for relating
to such transaction have been complied with.
-41-
<PAGE>
Section 802. Successor Substituted.
Upon any consolidation of the Company with, or merger of the Company into,
any other Person or any conveyance, transfer or lease of the properties and
assets of the Company substantially as an entirety in accordance with Section
801, the successor Person formed by such consolidation or into which the Company
is merged or to which such conveyance, transfer or lease is made shall succeed
to, and be substituted for, and may exercise every right and power of, the
Company under this Indenture with the same effect as if such successor Person
had been named as the Company herein, and thereafter, except in the case of a
lease, the predecessor Person shall be relieved of all obligations and covenants
under this Indenture and the Securities.
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by an
officer pursuant to authority established by a Board Resolution, and the
Trustee, at any time and from time to time, may enter into one or more
indentures supplemental hereto, in form satisfactory to the Trustee, for any of
the following purposes:
(1) to evidence the succession of another Person to the Company and the
assumption by any such successor of the covenants of the Company herein and
in the Securities; or
(2) to add to the covenants of the Company for the benefit of the Holders
of all or any series of Securities (and if such covenants are to be for the
benefit of less than all series of Securities, stating that such covenants
are expressly being included solely for the benefit of such series) or to
surrender any right or power herein conferred upon the Company; or
(3) to add any additional Events of Default for the benefit of the Holders
of all or any series of Securities (and if such additional Events of Default
are to be for the benefit of less than all series of Securities, stating that
such additional Events of Default are expressly being included solely for the
benefit of such series); or
(4) to add to or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of
Securities in bearer form, registrable or not registrable as to principal,
and with or without interest coupons, or to permit or facilitate the issuance
of Securities in uncertificated form; or
(5) to add to, change or eliminate any of the provisions of this Indenture
in respect of one or more series of Securities, provided that any such
addition, change
-42-
<PAGE>
or elimination (A) shall neither (i) apply to any Security of any series
created prior to the execution of such supplemental indenture and entitled to
the benefit of such provision nor (ii) modify the rights of the Holder of any
such Security with respect to such provision or (B) shall become effective
only when there is no such Security Outstanding; or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any series as
permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment hereunder by
a successor Trustee with respect to the Securities of one or more series and
to add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, pursuant to the requirements of Section
611; or
(9) to add to, change or eliminate any of the provisions of this Indenture
in order to maintain the qualification of the Indenture under the Trust
Indenture Act; or
(10) to cure any ambiguity, to correct or supplement any provision herein
which may be defective or inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising under
this Indenture, provided that such action pursuant to this Clause (10) shall
not in the reasonable judgment of the Company adversely affect the interests
of the Holders of Securities of any series in any material respect.
Section 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series affected by
such supplemental indenture, by Act of said Holders delivered to the Company
and the Trustee, the Company, when authorized by an Officer, and the Trustee
may enter into an indenture or indentures supplemental hereto for the purpose
of adding any provisions to or changing in any manner or eliminating any of
the provisions of this Indenture or of modifying in any manner the rights of
the Holders of Securities of such series under this Indenture; provided,
however, that no such supplemental indenture shall, without the consent of
the Holder of each Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or any instalment
of principal of or interest on, any Security, or reduce the principal
amount thereof or the rate of interest thereon or any premium payable upon
the redemption thereof, or reduce the amount of the principal of an
Original Issue Discount Security or any other Security which would be due
and payable upon a declaration of acceleration of the Maturity thereof
pursuant to Section 502, or change any Place of Payment
-43-
<PAGE>
where, or the coin or currency in which, any Security or any premium or
interest thereon is payable, or impair the right to institute suit for the
enforcement of any such payment on or after the Stated Maturity thereof (or,
in the case of redemption, on or after the Redemption Date), or modify the
provisions of this Indenture with respect to the subordination of the
Securities in a manner adverse to the Holders, or
(2) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of whose Holders is required for any
such supplemental indenture, or the consent of whose Holders is required for
any waiver (of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences) provided for in this
Indenture, or
(3) modify any of the provisions of this Section or Section 513, except to
increase any such percentage or to provide that certain other provisions of
this Indenture cannot be modified or waived without the consent of the Holder
of each Outstanding Security affected thereby; provided, however, that this
clause shall not be deemed to require the consent of any Holder with respect
to changes in the references to "the Trustee" and concomitant changes in this
Section, or the deletion of this proviso, in accordance with the requirements
of Sections 611 and 901(8).
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with respect to such covenant
or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
Section 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
Section 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture
-44-
<PAGE>
shall form a part of this Indenture for all purposes; and every Holder of
Securities theretofore or thereafter authenticated and delivered hereunder shall
be bound thereby.
Section 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
Section 906. Reference in Securities to Supplemental Indentures.
Securities of any series authenticated and delivered after the execution
of any supplemental indenture pursuant to this Article may, and shall if
required by the Trustee, bear a notation in form approved by the Trustee as to
any matter provided for in such supplemental indenture. If the Company shall so
determine, new Securities of any series so modified as to conform, in the
opinion of the Trustee and the Company, to any such supplemental indenture may
be prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities of such series.
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of and any premium
and interest (including any Additional Interest) on the Securities of that
series in accordance with the terms of the Securities and this Indenture.
Section 1002. Maintenance of Office or Agency.
The Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Company in respect of the Securities of that series and this Indenture
may be served. The Company will give prompt written notice to the Trustee of
the location, and any change in the location, of such office or agency. If at
any time the Company shall fail to maintain any such required office or agency
or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands. The
-45-
<PAGE>
Company or any Affiliate of the Company may act as Paying Agent or agent for
service of notices and demands.
The Company may also from time to time designate one or more other offices
or agencies where the Securities of one or more series may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an office or agency
in each Place of Payment for Securities of any series for such purposes. The
Company will give prompt written notice to the Trustee of any such designation
or rescission and of any change in the location of any such other office or
agency.
Section 1003. Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with respect
to any series of Securities, it will, on or before each due date of the
principal of or any premium or interest on any of the Securities of that series,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay the principal and any premium and interest so becoming due
until such sums shall be paid to such Persons or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or failure so to
act.
Whenever the Company shall have one or more Paying Agents for any series
of Securities, it will, on or before each due date of the principal of or any
premium or interest on any Securities of that series, deposit with a Paying
Agent a sum sufficient to pay such amount, such sum to be held as provided by
the Trust Indenture Act, and (unless such Paying Agent is the Trustee) the
Company will promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent for any series of Securities
other than the Trustee to execute and deliver to the Trustee an instrument in
which such Paying Agent shall agree with the Trustee, subject to the provisions
of this Section, that such Paying Agent will (1) comply with the provisions of
the Trust Indenture Act applicable to it as a Paying Agent and (2) during the
continuance of any default by the Company (or any other obligor upon the
Securities of that series) in the making of any payment in respect of the
Securities of that series, upon the written request of the Trustee, forthwith
pay to the Trustee all sums held in trust by such Paying Agent for payment in
respect of the Securities of that series.
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.
-46-
<PAGE>
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of or any premium or
interest on any Security of any series and remaining unclaimed for two years
after such principal, premium or interest has become due and payable shall be
paid to the Company on Company Request, or (if then held by the Company) shall
be discharged from such trust; and the Holder of such Security shall thereafter,
as an unsecured general creditor, look only to the Company for payment thereof,
and all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in New York, New York,
notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such publication,
any unclaimed balance of such money then remaining will be repaid to the
Company.
Section 1004. Statement by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after the end of
each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions of Sections 1001, 1002, 1003 and 1005 (without regard
to any period of grace or requirement of notice provided hereunder) and, if the
Company shall be in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge.
Section 1005. Additional Covenants.
The Company covenants and agrees, for the benefit of the Holders of
Securities of each series, that it will not, and will not permit any Subsidiary
of the Company to, declare or pay any dividend or distribution on, or redeem,
purchase, acquire or make a liquidation or guarantee payment (other than
payments under a Guarantee) with respect to, any shares of capital stock or any
security of the Company (including other Securities) ranking pari passu with or
---- -----
junior in interest to the Securities, except in each case with securities junior
in interest to the Securities and except for payments made on any series of
Securities upon the stated maturity of such Securities, if at such time (i)
there shall have occurred any event of which the Company has actual knowledge
that (a) with the giving of notice or the lapse of time or both, would
constitute an Event of Default hereunder with respect to Securities of such
series and (b) in respect of which the Company shall not have taken reasonable
steps to cure, (ii) the Company shall be in default with respect to its payment
of any obligations under the Guarantee relating to the Preferred Securities of
the Trust to which the Securities of such series have been issued or (iii) the
Company shall have given notice of its selection of an Extension Period as
-47-
<PAGE>
provided herein with respect to Securities of such series and such period, or
any extension thereof, shall have commenced and be continuing.
The Company also covenants, for the benefit of the Holders of Securities
of each series, (i) to maintain directly or indirectly 100% ownership of the
Common Securities of the Trust to which the Securities of such series have been
issued; provided, however, that any permitted successor of the Company hereunder
may succeed to the Company's ownership of such Common Securities, (ii) not to
voluntarily dissolve, wind-up or terminate such Trust, except (A) in connection
with a distribution of the Securities of such series to the holders of Preferred
Securities in liquidation of such Trust, (B) as otherwise permitted by the terms
specified pursuant to Section 301 for such Securities or (C) in connection with
certain mergers, consolidations or amalgamations permitted by the Trust
Agreement relating to such Trust and (iii) to use its reasonable efforts,
consistent with the terms and provisions of such Trust Agreement, to cause such
Trust to remain a business trust and not to be classified as an association
taxable as a corporation for United States federal income tax purposes.
Section 1006. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any term,
provision or condition set forth in Sections 1002 to 1005, inclusive, with
respect to the Securities of any series if before the time for such compliance
the Holders of at least a majority in principal amount of the Outstanding
Securities of such series shall, by Act of such Holders, either waive such
compliance in such instance or generally waive compliance with such term,
provision or condition, but no such waiver shall become effective, the
obligations of the Company and the duties of the Trustee in respect of any such
term, a provision or condition shall remain in full force and effect.
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article.
Securities of any series which are redeemable before their Stated Maturity
shall be redeemable in accordance with their terms and (except as otherwise
specified as contemplated by Section 301 for such Securities) in accordance with
this Article.
Section 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be evidenced by
a Board Resolution or in another manner specified as contemplated by Section 301
for such Securities. In case of any redemption at the election of the Company
of less than all the Securities of any series (including any such redemption
affecting only a single
-48-
<PAGE>
Security), the Company shall, at least 40 days and no more than 60 days prior to
the Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date, of the
principal amount of Securities of such series to be redeemed and, if applicable,
of the tenor of the Securities to be redeemed. In the case of any redemption of
Securities prior to the expiration of any restriction on such redemption
provided in the terms of such Securities or elsewhere in this Indenture, the
Company shall furnish the Trustee with an Officers' Certificate evidencing
compliance with such restriction.
Section 1103. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities of any series are to be redeemed (unless
all the Securities of such series and of a specified tenor are to be redeemed or
unless such redemption affects only a single Security), the particular
Securities to be redeemed shall be selected not more than 45 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities of such series
not previously called for redemption, by such method as the Trustee shall deem
fair and appropriate and which may provide for the selection for redemption of a
portion of the principal amount of any Security of such series, provided that
the unredeemed portion of the principal amount of any Security shall be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for such Security. If less than all the Securities of such series
and of a specified tenor are to be redeemed (unless such redemption affects only
a single Security), the particular Securities to be redeemed shall be selected
not more than 45 days prior to the Redemption Date by the Trustee, from the
Outstanding Securities of such series and specified tenor not previously called
for redemption in accordance with the preceding sentence.
The Trustee shall promptly notify the Company in writing of the Securities
selected for redemption as aforesaid and, in case of any Securities selected for
partial redemption as aforesaid, the principal amount thereof to be redeemed.
The provisions of the two preceding paragraphs shall not apply with
respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities shall relate, in the
case of any Securities redeemed or to be redeemed only in part, to the portion
of the principal amount of such Securities which has been or is to be redeemed.
-49-
<PAGE>
Section 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage prepaid,
mailed not less than 30 nor more than 60 days prior to the Redemption Date, to
each Holder of Securities to be redeemed, at his address appearing in the
Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities of any series consisting
of more than a single Security are to be redeemed, the identification (and,
in the case of partial redemption of any such Securities, the principal
amounts) of the particular Securities to be redeemed and, if less than all
the Outstanding Securities of any series consisting of a single Security are
to be redeemed, the principal amount of the particular Security to be
redeemed,
(4) that on the Redemption Date the Redemption Price will become due and
payable upon each such Security to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date,
(5) the place or places where each such Security is to be surrendered for
payment of the Redemption Price, and
(6) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.
Section 1105. Deposit of Redemption Price.
On or prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 1003) an amount of
money sufficient to pay the Redemption Price of, and (except if the Redemption
Date shall be an Interest Payment Date) accrued interest on, all the Securities
which are to be redeemed on that date.
Section 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities so to
be redeemed shall, on the Redemption Date, become due and payable at the
Redemption
-50-
<PAGE>
Price therein specified, and from and after such date (unless the Company shall
default in the payment of the Redemption Price and accrued interest) such
Securities shall cease to bear interest. Upon surrender of any such Security
for redemption in accordance with said notice, such Security shall be paid by
the Company at the Redemption Price, together with accrued interest to the
Redemption Date; provided, however, that, unless otherwise specified as
contemplated by Section 301, installments of interest whose Stated Maturity is
on or prior to the Redemption Date will be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of business on the relevant Record Dates according to their terms and the
provisions of Section 307.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal and any premium shall, until paid, bear
interest from the Redemption Date at the rate prescribed therefor in the
Security.
Section 1107. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered at
a Place of Payment therefor (with, if the Company or the Trustee so requires,
due endorsement by, or a written instrument of transfer in form satisfactory to
the Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and deliver to the Holder of such Security without service
charge, a new Security or Securities of the same series and of like tenor, of
any authorized denomination as requested by such Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered.
ARTICLE TWELVE
SINKING FUNDS
Section 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund for
the retirement of Securities of any series except as otherwise specified as
contemplated by Section 301 for such Securities.
The minimum amount of any sinking fund payment provided for by the terms
of any Securities is herein referred to as a "mandatory sinking fund payment",
and any payment in excess of such minimum amount provided for by the terms of
such Securities is herein referred to as an "optional sinking fund payment". If
provided for by the terms of any Securities, the cash amount of any sinking fund
payment may be subject to reduction as provided in Section 1202. Each sinking
fund payment shall be applied to the redemption of Securities as provided for by
the terms of such Securities.
-51-
<PAGE>
Section 1202. Satisfaction of Sinking Fund Payments with Securities.
The Company (1) may deliver Outstanding Securities of a series (other than
any previously called for redemption) and (2) may apply as a credit Securities
of a series which have been redeemed either at the election of the Company
pursuant to the terms of such Securities or through the application of permitted
optional sinking fund payments pursuant to the terms of such Securities, in each
case in satisfaction of all or any part of any sinking fund payment with respect
to any Securities of such series required to be made pursuant to the terms of
such Securities as and to the extent provided for by the terms of such
Securities; provided that the Securities to be so credited have not been
previously so credited. The Securities to be so credited shall be received and
credited for such purpose by the Trustee at the Redemption Price, as specified
in the Securities so to be redeemed, for redemption through operation of the
sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.
Section 1203. Redemption of Securities for Sinking Fund.
Not less than 60 days prior to each sinking fund payment date for any
Securities, the Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for such
Securities pursuant to the terms of such Securities, the portion thereof, if
any, which is to be satisfied by payment of cash and the portion thereof, if
any, which is to be satisfied by delivering and crediting Securities pursuant to
Section 1202 and will also deliver to the Trustee any Securities to be so
delivered. Not less than 30 days prior to each such sinking fund payment date,
the Trustee shall select the Securities to be redeemed upon such sinking fund
payment date in the manner specified in Section 1103 and cause notice of the
redemption thereof to be given in the name of and at the expense of the Company
in the manner provided in Section 1104. Such notice having been duly given, the
redemption of such Securities shall be made upon the terms and in the manner
stated in Sections 1106 and 1107.
ARTICLE THIRTEEN
SUBORDINATION OF SECURITIES
Section 1301. Securities Subordinate to Senior Indebtedness.
The Company covenants and agrees, and each Holder of a Security, by his
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article (subject to Article Four), the
payment of the principal of and any premium and interest (including any
Additional Interest) on each and all of the Securities are hereby expressly made
subordinate and subject in right of payment to the prior payment in full in cash
of all Senior Indebtedness.
-52-
<PAGE>
This Article Thirteen shall constitute a continuing offer to all persons
who become holders of, or continue to hold, Senior Indebtedness, and such
provisions are made for the benefit of the holders of Senior Indebtedness and
such holders are made obligees hereunder and any one or more of them may enforce
such provisions. Holders of Senior Indebtedness need not prove reliance on the
subordination provisions hereof.
Section 1302. Default on Senior Indebtedness.
In the event and during the continuation of any default in the payment of
principal, premium, interest or any other payment due on any Senior Indebtedness
(and any applicable grace period with respect to such default has ended and such
default has not been cured or waived) or in the event that the maturity of any
Senior Indebtedness has accelerated because of a default, then, in either case,
no payment shall be made by the Company with respect to the principal (including
redemption payments) of, or premium or interest on, the Securities.
In the event that, notwithstanding the foregoing, any payment shall be
received by the Trustee or any Holder when such payment is prohibited by the
preceding paragraph of this Section 1302, such payment shall be held in trust
for the benefit of, and shall be paid over or delivered to the holders of Senior
Indebtedness or their respective representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Senior Indebtedness may have
been issued, as their respective interests may appear, but only to the extent
that the holders of the Senior Indebtedness (or their representative or
representatives or a trustee) notify the Trustee within 90 days of such payment
of the amounts then due and owing on the Senior Indebtedness and only the
amounts specified in such notice to the Trustee shall be paid to the holders of
Senior Indebtedness.
Section 1303. Liquidation; Dissolution; Bankruptcy.
Upon any payment by the Company, or distribution of assets of the Company
of any kind or character, whether in cash, property or securities, to creditors
upon any dissolution or winding-up or liquidation or reorganization of the
Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due upon all Senior Indebtedness
shall first be paid in full, or payment thereof provided for in money in
accordance with its terms, before any payment is made on account of the
principal of or any premium or interest on the Securities; and upon any such
dissolution or winding-up or liquidation or reorganization any payment by the
Company, or distribution of substantially all of the assets of the Company of
any kind or character, whether in cash, property or securities, to which the
Holders of the Security or the Trustee would be entitled, except for the
provisions of this Article Thirteen, shall be paid by the Company or by any
receiver, trustee in bankruptcy, liquidating trustee, agent or other Person
making such payment or distribution, or by the Holders of the Securities or by
the Trustee under this Indenture if received by them or by it, directly to the
holders of Senior Indebtedness (pro rata to such holders on the basis of the
respective amounts of Senior Indebtedness held by such holders, as calculated by
the Company) or
-53-
<PAGE>
their representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any Senior Indebtedness
may have been issued, as their respective interests may appear, to the extent
necessary to pay all Senior Indebtedness in full, in money or money's worth,
after giving effect to any concurrent payment or distribution to or for the
holders of Senior Indebtedness, before any payment or distribution is made to
the Holders of Securities or to the Trustee.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, prohibited by the foregoing, shall be received by the
Trustee or the Holders of the Securities before all Senior Indebtedness is paid
in full, or provision is made for such payment in money in accordance with its
terms, such payment or distribution shall be held in trust for the benefit of
and shall be paid over or delivered to the holders of Senior Indebtedness or
their representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any Senior Indebtedness
may have been issued, as their respective interests may appear, as calculated by
the Company, for application to the payment of all Senior Indebtedness remaining
unpaid to the extent necessary to pay all Senior Indebtedness in full in money
in accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the holders of such Senior Indebtedness.
For purposes of this Article Thirteen, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided in this Article Thirteen with
respect to the Securities to the payment of all Senior Indebtedness that may at
the time be outstanding, provided, however, that (i) the Senior Indebtedness is
-------- -------
assumed by the new corporation, if any, resulting from any such reorganization
or readjustment, and (ii) the rights of the holders of the Senior Indebtedness
are not, without the consent of such holders, altered by such reorganization or
readjustment. The consolidation of the Company with, or the merger of the
Company into, another corporation or the liquidation or dissolution of the
Company following the conveyance or transfer of its property as an entirety, or
substantially as an entirety, to another Person upon the terms and conditions
provided for in Article Eight hereof shall not be deemed a dissolution, winding-
up, liquidation or reorganization for the purposes of this Section 1303 if such
other Person shall, as a part of such consolidation, merger, conveyance or
transfer, comply with the conditions stated in Article Eight hereof. Nothing in
Section 1302 or in this Section 1303 shall apply to claims of, or payments to,
the Trustee under or pursuant to Section 607.
Section 1304. Subrogation.
Subject to the payment in full of all Senior Indebtedness, the rights of
the Holders of the Securities shall be subrogated to the rights of the holders
of Senior Indebtedness to receive payments or distributions of cash, property or
securities of the Company applicable to the Senior Indebtedness until the
principal of (and premium, if
-54-
<PAGE>
any) and interest on the Securities shall be paid in full; and, for the purposes
of such subrogation, no payments or distributions to the holders of the Senior
Indebtedness of any cash, property or securities to which the Holders of the
Securities or the Trustee would be entitled except for the provisions of this
Article Thirteen, and no payment over pursuant to the provisions of this Article
Thirteen, to or for the benefit of the holders of Senior Indebtedness by Holders
of the Securities or the Trustee, shall, as between the Company, its creditors
other than holders of Senior Indebtedness, and the Holders of the Securities, be
deemed to be a payment by the Company to or on account of the Senior
Indebtedness. It is understood that the provisions of this Article Thirteen are
and are intended solely for the purposes of defining the relative rights of the
Holders of the Securities, on the one hand, and the holders of the Senior
Indebtedness on the other hand.
Nothing in this Article Thirteen or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as between the Company, its creditors
other than the holders of Senior Indebtedness, and the Holders of the
Securities, the obligation of the Company, which is absolute and unconditional,
to pay to the Holders of the Securities the principal of (and premium, if any)
and interest on the Securities as and when the same shall become due and payable
in accordance with their terms, or is intended to or shall affect the relative
rights of the Holders of the Securities and creditors of the Company other than
the holders of the Senior Indebtedness, nor shall anything herein or therein
prevent the Trustee or the Holder of any Security from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture, subject
to the rights, if any, under this Article Thirteen of the holder of Senior
Indebtedness in respect of cash, property or securities of the Company received
upon the exercise of such remedy.
Upon any payment or distribution of assets of the Company referred to in
this Article Thirteen, the Trustee, subject to the provisions of Section 601,
and the Holders of the Securities, shall be entitled to rely upon any order or
decree made by any court of competent jurisdiction in which such dissolution,
winding-up, liquidation or reorganization proceedings are pending, or a
certificate of the receiver, trustee in bankruptcy, liquidation trustee, agent
or other Person making such payment or distribution, delivered to the Trustee or
to the Holders of the Securities, for the purposes of ascertaining the Persons
entitled to participate in such distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article Thirteen.
Section 1305. Notice by the Company.
Each Holder of a Security by acceptance thereof authorizes and directs the
Trustee on such Holder's behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article Thirteen
and appoints the Trustee such Holder's attorney-in-fact for any and all such
purposes.
-55-
<PAGE>
Section 1306. Notice by The Company.
The Company shall give prompt written notice to a Responsible Officer of
the Trustee of any fact known to the Company that would prohibit the making of
any payment of monies to or by the Trustee in respect of the Securities pursuant
to the provisions of this Article Thirteen. Notwithstanding the provisions of
this Article Thirteen or any other provision of this Indenture, the Trustee
shall not be charged with knowledge of the existence of any facts that would
prohibit the making of any payment of monies to or by the Trustee in respect of
the Securities pursuant to the provisions of this Article Thirteen, unless and
until a Responsible Officer of the Trustee shall have received written notice
thereof at the Corporate Trust Office of the Trustee from the Company or a
holder or holders of Senior Indebtedness or from any trustee therefor; and
before the receipt of any such written notice, the Trustee, subject to the
provisions of Section 601, shall be entitled in all respects to assume that no
such facts exist; provided, however, that if the Trustee shall not have received
-------- -------
the notice provided for in this Section 1306 at least two Business Days prior to
the date upon which by the terms hereof any money may become payable for any
purpose (including, without limitation, the payment of the principal of (or
premium, if any) or interest on any Security), then, anything herein contained
to the contrary notwithstanding, the Trustee shall have full power and authority
to receive such money and to apply the same to the purposes for which they were
received, and shall not be affected by any notice to the contrary that may be
received by it within two Business Days prior to such date.
The Trustee, subject to the provisions of Section 601, shall be entitled
to rely on the delivery to it of a written notice by a Person representing
himself to be a holder of Senior Indebtedness (or a trustee on behalf of such
holder) to establish that such notice has been given by a holder of Senior
Indebtedness or a trustee on behalf of any such holder or holders. In the event
that the Trustee determines in good faith that further evidence is required with
respect to the right of any Person as a holder of Senior Indebtedness to
participate in any payment or distribution pursuant to this Article Thirteen,
the Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Indebtedness held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article Thirteen, and if such evidence is not furnished the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment.
Section 1307. Rights of the Trustee; Holders of Senior Indebtedness.
The Trustee in its individual capacity shall be entitled to all the rights
set forth in this Article Thirteen in respect of any Senior Indebtedness at any
time held by it, to the same extent as any other holder of Senior Indebtedness,
and nothing in this Indenture shall deprive the Trustee of any of its rights as
such holder.
With respect to the holders of Senior Indebtedness, the Trustee undertakes
to perform or to observe only such of its covenants and obligations as are
specifically set
-56-
<PAGE>
forth in this Article Thirteen, and no implied covenants or obligations with
respect to the holders of Senior Indebtedness shall be read into this Indenture
against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty
to the holders of Senior Indebtedness and, subject to the provisions of Section
601, the Trustee shall not be liable to any holder of Senior Indebtedness if it
shall pay over or deliver to holders of Securities, the Company or any other
Person money or assets to which any holder of Senior Indebtedness shall be
entitled by virtue of this Article Thirteen or otherwise.
Section 1308. Subordination May Not be Impaired.
No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof that any such holder may have or
otherwise be charged with.
Without in any way limiting the generality of the foregoing paragraph, the
holders of Senior Indebtedness may, at any time and from time to time, without
the consent of or notice to the Trustee or the Holders of the Securities,
without incurring responsibility to the Holders of the Securities and without
impairing or releasing the subordination provided in this Article or the
obligations hereunder of the Holders of the Securities to the holders of Senior
Indebtedness, do any one or more of the following: (i) change the manner, place
or terms of payment or extend the time of payment of, or renew or alter, Senior
Indebtedness or otherwise amend or supplement in any manner Senior Indebtedness
or any instrument evidencing the same or any agreement under which Senior
Indebtedness in outstanding; (ii) sell, exchange, release or otherwise deal with
any property pledged, mortgaged or otherwise securing Senior Indebtedness; (iii)
release any Person liable in any manner for the collection of Senior
Indebtedness; and (iv) exercise or refrain from exercising any right against the
Company and any other Person.
-57-
<PAGE>
--------------------------
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
In Witness Whereof, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
PACIFIC GAS AND ELECTRIC COMPANY
.................................
Attest:
....................................
THE FIRST NATIONAL BANK OF CHICAGO
By................................
Attest:
....................................
-58-
<PAGE>
EXHIBIT 4.4
================================================================================
PACIFIC GAS AND ELECTRIC COMPANY
TO
THE FIRST NATIONAL BANK OF CHICAGO
Trustee
____________________
FIRST SUPPLEMENTAL INDENTURE
Dated as of ___________________, 1995
TO
INDENTURE
Dated as of ___________________, 1995
____________________
_____% Deferrable Interest Subordinated Debentures, Series A, Due 2025
================================================================================
<PAGE>
FIRST SUPPLEMENTAL INDENTURE, dated as of _________________, 1995 (the
"First Supplemental Indenture"), between Pacific Gas and Electric Company, a
California corporation (the "Company"), and The First National Bank of Chicago,
a national banking association organized under the laws of the United States, as
trustee (the "Trustee") under the Indenture, dated as of _____________________,
1995, between the Company and the Trustee (the "Indenture").
WHEREAS, the Company executed and delivered the Indenture to the
Trustee to provide for the future issuance of its subordinated debentures (the
"Securities"), such Securities to be issued from time to time in one or more
series as might be determined by the Company under the Indenture, in an
unlimited aggregate principal amount that may be authenticated and delivered
thereunder as provided in the Indenture;
WHEREAS, PG&E Capital I (the "Series A Trust") may pursuant to the
Underwriting Agreement dated ______________, 1995 among the Company, the Series
A Trust and the Underwriters named therein issue $________________ (or up to
$______________ if the Underwriters' overallotment option is exercised)
aggregate liquidation preference of its ___% Cumulative Quarterly Income
Preferred Securities, Series A, Due 2025 (the "Series A Preferred Securities")
with a liquidation preference of $25 per Series A Preferred Security;
WHEREAS, the Company is guaranteeing the payment of distributions on
the Series A Preferred Securities, and payment of the Redemption Price and
payments on liquidation with respect to the Series A Preferred Securities, to
the extent provided in the Guarantee Agreement dated _________, 1995, by the
Company and The First National Bank of Chicago, as guarantee trustee (the
"Guarantee") for the benefit of the holders of the Series A Preferred
Securities;
WHEREAS, the Company wishes to sell to the Series A Trust, and the
Series A Trust wishes to purchase from the Company, Series A Securities (as
defined below) in an aggregate principal amount equal to $__________________ (or
up to $________________ if the Underwriters' overallotment option is exercised),
and in satisfaction of the purchase price for such Series A Securities, the
trustees of the Series A Trust, on behalf of the Series A Trust, wish to (i)
execute and deliver to the Company Common Securities certificates evidencing an
ownership interest in the Series A Trust, registered in the name of the Company,
in an aggregate amount of _________ (or __________ if the overallotment option
is exercised in full) having an aggregate liquidation amount of $_______________
(or $__________________ if the overallotment option is exercised in full) and
(ii) deliver to the Company the sum of $_________________ (or up to $_________
if the overallotment option is exercised in full);
WHEREAS, the Company has duly authorized the creation of an issue of
its ____% Deferrable Interest Subordinated Debentures, Series A (the "Series A
Securities"), of substantially the tenor and amount hereinafter set forth and to
provide therefor the Company has duly authorized the execution and delivery of
this First Supplemental Indenture; and
<PAGE>
WHEREAS, all things necessary to make the Series A Securities, when
executed by the Company and authenticated and delivered hereunder and duly
issued by the Company, the valid obligations of the Company, and to make this
First Supplemental Indenture a valid agreement of the Company, in accordance
with their and its terms, have been done.
NOW THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Series A Securities by the Holders thereof, it is mutually agreed, for the equal
and proportionate benefit of all Holders of the Series A Securities as follows:
ARTICLE ONE
General Terms of the Series A Securities
SECTION 101. Title; Stated Maturity; Interest.
--------------------------------
There shall be and is hereby authorized a series of Securities known
and designated as the "___% Deferrable Interest Subordinated Debentures, Series
A, Due 2025" of the Company, limited in aggregate principal amount to $_____.
Their Stated Maturity shall be _______, 2025, and they shall bear interest at
the rate of ____% per annum, from _____, 1995 or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, as the case
may be, payable quarterly (subject to deferral as set forth herein), in arrears,
on March 31, June 30, September 30 and December 31 of each year, commencing
____, 1995, until the principal thereof is paid or made available for payment.
Interest will compound quarterly and will include interest that will accrue at
the rate of ____% per annum on any interest installment in arrears after the
quarterly payment date therefor to the extent permitted by law. Additional
Interest (as defined below), if any, then due on the Securities shall be payable
on each Interest Payment Date. The Regular Record Date for the interest payable
on any Interest Payment Date shall be the Business Day next preceding such
Interest Payment Date, provided that if at any time the Series A Securities are
not held by the Trust and are not evidenced by a Global Security, the Regular
Record Date shall be the 15th day prior to the Interest Payment Date.
The Company shall have the right, at any time during the term of the
Series A Securities, from time to time to extend the interest payment period for
up to 20 consecutive quarters (the "Extension Period") during which period
interest will compound quarterly, and at the end of which Extension Period the
Company shall pay all interest then accrued and unpaid thereon (together with
Additional Interest), provided, however, that during any such Extension Period,
the Company shall not, and shall not permit any Subsidiary of the Company to,
declare or pay any dividend or distribution on, or redeem, purchase, acquire, or
make a liquidation or guarantee payment (other than payments under a Guarantee)
with respect to, any shares of the Company's capital stock or any other security
of the
-2-
<PAGE>
Company (including other Securities) ranking pari passu with or junior in
---- -----
interest to the Series A Securities, except in each case with securities ranking
junior in interest to the Series A Securities and except for payments made on
any series of Securities upon the Stated Maturity of such Securities. Prior to
the termination of any such Extension Period, the Company may further extend the
interest payment period, provided that such Extension Period together with all
such previous and further extensions thereof shall not exceed 20 consecutive
quarters or extend beyond the Maturity of the Series A Securities. Upon the
termination of any Extension Period and upon the payment of all accrued and
unpaid interest and any Additional Interest then due, the Company may select a
new Extension Period, subject to the above requirements. No interest or
Additional Interest shall be due and payable during an Extension Period, except
at the end thereof. The Company shall give the Series A Trust and the Trustee
notice of its selection of such Extension Period subject to the above
requirements at least one Business Day prior to the date the Series A Trust is
required to give notice to the New York Stock Exchange or other applicable self-
regulatory organization or to holders of the Series A Preferred Securities of
the record date or the date distributions on the Series A Preferred Securities
are payable, but in any event not less than one Business Day prior to such
record date. The Trustee shall promptly notify the holders of the Series A
Preferred Securities of the Company's selection of such an Extension Period.
The principal of and interest on the Series A Securities shall be
payable at the office or agency or designated or maintained by the Company for
such purpose in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts;
provided, however, that at the option of the Company payment of interest may be
-------- -------
made (i) by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register or (ii) by wire transfer in
immediately available funds at such place and to such account as may be
designated by the Person entitled thereto as specified in the Security Register.
The corporate trust office of the Debenture Trustee in Chicago, Illinois is
initialy designated as the Company's sole Paying Agent for payments with respect
to the Series A Debentures.
As used herein, "Additional Interest" means if the Series A Trust is
required to pay any taxes, duties, assessments or governmental charges of
whatever nature (other than withholding taxes) imposed by the United States or
any other taxing authority, such amounts as shall be required so that the net
amounts received and retained by the Series A Trust after paying such taxes,
duties, assessments or governmental charges shall not be less than the amounts
the Series A Trust would have received had no such taxes, duties, assessments or
governmental charges been imposed.
SECTION 102. Redemption.
----------
At any time on or after _______________, 2000, the Company shall have
the right to redeem the Series A Securities, in whole or in part, from time to
time, at a Redemption Price equal to 100% of the principal amount of Series A
Securities to be redeemed plus accrued but unpaid interest, including Additional
Interest, if any, to the Redemption Date.
-3-
<PAGE>
If a Tax Event or an Investment Company Event shall occur and be
continuing, the Company shall have the right, subject to the last sentence of
the following paragraph, to redeem the Series A Securities in whole but not in
part, at a Redemption Price equal to 100% of the principal amount thereof plus
accrued but unpaid interest, including any Additional Interest, if any, to the
Redemption Date, within 90 days following the occurrence of such Special Event.
If an order for dissolution of the Series A Trust shall be entered by
a court of competent jurisdiction, the Company shall have the right to redeem
the Series A Securities in whole but not in part at a Redemption Price equal to
100% of the principal amount thereof plus accrued but unpaid interest, including
any Additional Interest, if any, to the Redemption Date.
The Company shall not redeem the Series A Securities in part unless
all accrued and unpaid interest (including any Additional Interest) has been
paid in full on all Series A Securities Outstanding for all quarterly interest
periods terminating on or prior to the Redemption Date.
As used herein, "Tax Event" means that the Company shall have received
an Opinion of Counsel experienced in such matters to the effect that, as a
result of any amendment to, or change (including any announced prospective
change) in, the laws (or any regulations thereunder) of the United States or any
political subdivision or taxing authority thereof or therein affecting taxation,
or as a result of any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or such pronouncement or decision is announced on or after the date of
issuance of the Series A Preferred Securities, there is more than an
insubstantial risk that (i) the Series A Trust is, or will be, subject to United
States federal income tax with respect to interest received on the Series A
Securities, (ii) interest payable by the Depositor on the Series A Securities is
not, or will not be, deductible for United States federal income tax purposes or
(iii) the Series A Trust is, or will be, subject to more than a de minimis
amount of other taxes, duties or other governmental charges.
As used herein, "Investment Company Event" means the occurrence of a
change in law or regulation or a change in interpretation or application of law
or regulation by any legislative body, court, governmental agency or regulatory
authority (a "Change in 1940 Act Law") to the effect that the Series A Trust is
or will be considered an "investment company" that is required to be registered
under the Investment Company Act of 1940, as amended, which Change in 1940 Act
Law becomes effective on or after the date of issuance of the Series A Preferred
Securities.
-4-
<PAGE>
SECTION 103. Global Security.
---------------
If the Series A Trust is not the sole Holder of the Series A
Securities, in order to utilize a book-entry-only system for all or any portion
of the Series A Securities, all or a portion of the Series A Securities may be
issued in the form of one or more fully registered Global Securities for the
aggregate principal amount of such Series A Securities (the "Series A Global
Securities"), which Series A Global Securities shall be registered in the name
of the Depositary selected by the Company or in the name of such Depositary's
nominee. Each Series A Global Security shall be delivered by the Trustee to the
Depositary or pursuant to the Depositary's instruction.
If an event described under Clause (2) of Section 305 of the Indenture
shall occur, then this Section 103 shall no longer be applicable to the Series A
Global Securities and the Company will execute, and the Trustee will
authenticate and deliver (subject to receipt of an Officer's Certificate
evidencing the Company's determination if the Company has exercised its rights
under Clause (2)(C) of Section 305) Series A Securities in definitive registered
form without coupons, in authorized denominations, and in an aggregate principal
amount equal to the principal amount of the Series A Global Securities in
exchange for such Series A Global Securities. Upon the exchange of Series A
Global Securities for such Series A Securities in definitive registered form,
the Series A Global Securities shall be cancelled by the Trustee. Such Series A
Securities in definitive registered form issued in exchange for Series A Global
Securities pursuant to this Section 103 shall be registered in such names and in
such authorized denominations as the Depositary, pursuant to instructions from
its direct or indirect participants or otherwise, shall direct. The Trustee
shall deliver such Series A Securities to the Persons in whose names such Series
A Securities are so registered.
Except as provided below, owners solely of beneficial interests in a
Series A Global Security shall not be entitled to receive physical delivery of
Series A Securities in definitive form and will not be considered the Holders
thereof for any purpose under the Indenture.
Members of or participants in the Depositary shall have no rights
under this Indenture with respect to any Series A Global Security held on their
behalf by the Depositary, and such Depositary or its nominee, as the case may
be, may be treated by the Company, the Trustee, and any agent of the Company or
the Trustee as the Holder of such Series A Global Securities for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Company, the Trustee, or any agent of the Company or the Trustee, from giving
effect to any written certification, proxy or other authorization furnished by
the Depositary or impair, as between the Depositary and its members or
participants, the operation of customary practices governing the exercise of the
rights of a Holder of any Debenture, including without limitation the granting
of proxies or other authorization of participants to give or take any request,
demand, authorization, direction, notice, consent, waiver or other action which
a Holder is entitled to give or take under the Indenture.
-5-
<PAGE>
ARTICLE TWO
Form of Series A Security
The Series A Securities are to be in substantially the following form:
[FORM OF FACE OF SERIES A SECURITY]
PACIFIC GAS AND ELECTRIC COMPANY
..........................................................................
No. ......... $ ........
PACIFIC GAS AND ELECTRIC COMPANY, a corporation duly organized and
existing under the laws of California (herein called the "Company", which term
includes any successor Person under the Indenture hereinafter referred to), for
value received, hereby promises to pay to......................................
........., or registered assigns, the principal sum of ........................
.............. Dollars on ..............................................., and
to pay interest thereon from ............. or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, quarterly
(subject to deferral as set forth herein) on each March 31, June 30, September
30 and December 31 in each year, commencing ........., 1995, at the rate of
....% per annum, plus Additional Interest, if any, until the principal hereof
is paid or made available for payment. The interest so payable, and punctually
paid or duly provided for, on any Interest Payment Date will, as provided in
such Indenture, be paid to the Person in whose name this Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest, which shall be the Business Day next
preceding such Interest Payment Date. Any such interest not so punctually paid
or duly provided for will forthwith cease to be payable to the Holder on such
Regular Record Date and may either be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to Holders of Securities
of this series not less than 10 days prior to such Special Record Date, or be
paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities of this series
may be listed, and upon such notice as may be required by such exchange, all as
more fully provided in said Indenture.
The Company shall have the right at any time during the term of this
Security, from time to time, to extend the interest payment period of this
Security for up to 20 consecutive quarters (an "Extension Period"), during which
periods interest will compound quarterly and the Company shall have the right to
make partial payments of interest on any Interest Payment Date, and at the end
of which Extension Period the Company shall pay all interest then accrued and
unpaid (together with any Additional Interest); provided that during any such
Extension Period, the Company shall not, and shall not permit any Subsidiary of
the Company to, declare or pay any dividend or distribution on, or redeem,
purchase, acquire or
-6-
<PAGE>
make a liquidation or guarantee payment (other than payments under a Guarantee)
with respect to, any shares of the Company's capital stock or any other security
of the Company (including other Securities) ranking pari passu with or junior in
---- -----
interest to this Security, except in each case with securities ranking junior in
interest to this Security and except for payments made on any series of
Securities under the Indenture upon the Stated Maturity of such Securities.
Prior to the termination of any such Extension Period, the Company may further
extend the interest payment period, provided that such Extension Period together
with all such previous and further extensions thereof shall not exceed 20
consecutive quarters or extend beyond the Maturity of this Security. Upon the
termination of any such Extension Period and upon the payment of all accrued and
unpaid interest and any Additional Interest then due, the Company may select a
new Extension Period, subject to the above requirements. No interest shall be
due and payable during an Extension Period except at the end thereof. The
Company shall give the Holder of this Security and the Trustee notice of its
selection of an Extension Period at least one Business Day prior to the date the
Series A Trust is required to give notice to the New York Stock Exchange or
other applicable self-regulatory organization or to holders of the Series A
Preferred Securities of the record date or the date distributions on the Series
A Preferred Securities are payable, but in any event not less than one Business
Day prior to such record date.
Payment of the principal of and interest on this Security will be made
at the office or agency of the Company maintained for that purpose in Chicago,
Illinois, in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts;
provided, however, that at the option of the Company payment of interest may be
made (i) by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register or (ii) by wire transfer in
immediately available funds at such place and to such account as may be
designated by the Person entitled thereto as specified in the Security Register.
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
-7-
<PAGE>
In Witness Whereof, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
PACIFIC GAS AND ELECTRIC COMPANY
By..............................
Attest:
........................
[FORM OF REVERSE OF SERIES A SECURITY]
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or
more series under an Indenture, dated as of ..............., 1995, as
supplemented by a First Supplemental Indenture, dated as of __________, 1995
(herein called the "Indenture", which term shall have the meaning assigned to it
in such instrument), between the Company and The First National Bank of Chicago,
as Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture), and reference is hereby made to the Indenture for
a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee, the holders of Senior
Indebtedness and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered. This Security is one
of the series designated on the face hereof, limited in aggregate principal
amount to $.............
At any time on or after _________, 2000, the Company shall have the
right, subject to the terms and conditions of Article Twelve of the Indenture,
to redeem this Security at the option of the Company, without premium or
penalty, in whole or in part, at a Redemption Price equal to 100% of the
principal amount to be redeemed plus accrued but unpaid interest, including any
Additional Interest, if any, to the Redemption Date. If a Tax Event or an
Investment Company Event (each as defined in the Indenture) shall occur and be
continuing, the Company shall have the right, subject to the terms and
conditions of Article Twelve of the Indenture, to redeem this Security at the
option of the Company, without premium or penalty, in whole or in part, at a
Redemption Price equal to 100% of the principal amount thereof plus accrued but
unpaid interest, including any Additional Interest, if any, to the Redemption
Date. Any redemption pursuant to this paragraph will be made upon not less than
30 nor more than 60 days' notice, at the Redemption Price. If the Securities
are only partially redeemed by the Company, the Securities will be redeemed pro
rata, by lot or in such other manner as the Trustee shall deem appropriate and
fair in its discretion and that may provide for the selection of a portion or
portions (equal to twenty-five U.S. dollars ($25) or any integral multiple
thereof) of the principal amount of any Security.
-8-
<PAGE>
In the event of redemption of this Security in part only, a new
Security or Securities of this series and of like tenor for the unredeemed
portion hereof will be issued in the name of the Holder hereof upon the
cancellation hereof.
The indebtedness evidenced by this Security is, to the extent provided
in the Indenture, subordinate and subject in right of payment to the prior
payment in full of all Senior Indebtedness, and this Security is issued subject
to the provisions of the Indenture with respect thereto. Each Holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his behalf to take such
action as may be necessary or appropriate to effectuate the subordination so
provided and (c) appoints the Trustee his attorney-in-fact for any and all such
purposes. Each Holder hereof, by his acceptance hereof, waives all notice of
the acceptance of the subordination provisions contained herein and in the
Indenture of each holder of Senior Indebtedness, whether now outstanding or
hereafter incurred, and waives reliance by each such holder upon said
provisions.
If an Event of Default with respect to Securities of this series shall
occur and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder, unless such Holder shall have previously given
the Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request and offer of indemnity. The foregoing
shall not apply to any suit instituted by the Holder of this Security for the
-9-
<PAGE>
enforcement of any payment of principal hereof or interest hereon on or after
the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of and interest on this
Security at the times, place and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any place where the principal of and interest
on this Security are payable, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Securities of this series and of like
tenor, of authorized denominations and for the same aggregate principal amount,
will be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $25 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal amount
of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
ARTICLE THREE
Miscellaneous Provisions
SECTION 301. Definitions of Terms.
--------------------
Except as otherwise expressly provided in this First Supplemental
Indenture or in the form of Series A Security otherwise clearly required by the
context hereof or thereof,
-10-
<PAGE>
all terms used herein that are defined in the Indenture shall have the meanings
assigned to them therein.
SECTION 302. Ratification of Indenture.
-------------------------
The Indenture, as supplemented by this First Supplemental Indenture,
is in all respects ratified and confirmed, and this First Supplemental Indenture
shall be deemed part of the Indenture in the manner and to the extent herein and
therein provided.
SECTION 303 Recitals. The recitals herein contained are made by the
--------
Company and not by the Trustee, and the Trustee assumes no responsibility for
the correctness thereof. The Trustee makes no representation as to the validity
or sufficiency of this First Supplemental Indenture.
SECTION 304. Counterparts. This First Supplemental Indenture may be
------------
executed in any number of counterparts each of which shall be an original, but
such counterparts shall together constitute but one and the same instrument.
-11-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed, and their respective corporate seals
to be hereunto affixed and attested, on the date or dates indicated in the
acknowledgments and as of the day and year first above written.
PACIFIC GAS AND ELECTRIC COMPANY
By _______________________________
Attest:
___________________________
Secretary
THE FIRST NATIONAL BANK OF CHICAGO
as Trustee
By ________________________________
Attest: ___________________
-12-
<PAGE>
Exhibit 4.5
GUARANTEE AGREEMENT
Between
Pacific Gas and Electric Company
(as Guarantor)
and
The First National Bank of Chicago
(as Trustee)
dated as of
______________, 1995
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions........................................... 2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.01. Trust Indenture Act; Application...................... 5
SECTION 2.02. Lists of Holders...................................... 5
SECTION 2.03. Reports by the Guarantee Trustee...................... 5
SECTION 2.04. Periodic Reports to Guarantee Trustee................. 6
SECTION 2.05. Evidence of Compliance with Conditions Precedent...... 6
SECTION 2.06. Events of Default; Waiver............................. 6
SECTION 2.07. Event of Default; Notice.............................. 6
SECTION 2.08. Conflicting Interests................................. 7
ARTICLE III
POWERS, DUTIES AND RIGHTS OF THE
GUARANTEE TRUSTEE
SECTION 3.01. Powers and Duties of the Guarantee Trustee............ 7
SECTION 3.02. Certain Rights of Guarantee Trustee................... 9
SECTION 3.03. Indemnity............................................. 11
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 4.01. Guarantee Trustee; Eligibility........................ 12
SECTION 4.02. Appointment, Removal and Resignation of the
Guarantee Trustee.................................... 13
</TABLE>
-i-
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE V
GUARANTEE
SECTION 5.01. Guarantee............................................. 13
SECTION 5.02. Waiver of Notice and Demand........................... 14
SECTION 5.03. Obligations Not Affected.............................. 14
SECTION 5.04. Rights of Holders..................................... 15
SECTION 5.05. Guarantee of Payment.................................. 15
SECTION 5.06. Subrogation........................................... 15
SECTION 5.07. Independent Obligations............................... 16
ARTICLE VI
COVENANTS AND SUBORDINATION
SECTION 6.01. Subordination......................................... 16
SECTION 6.02. Pari Passu Guarantees................................. 16
ARTICLE VII
TERMINATION
SECTION 7.01. Termination.......................................... 16
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Successors and Assigns............................... 17
SECTION 8.02. Amendments........................................... 17
SECTION 8.03. Notices.............................................. 17
SECTION 8.04. Benefit.............................................. 18
SECTION 8.05. Interpretation....................................... 18
SECTION 8.06. Governing Law........................................ 19
</TABLE>
-ii-
<PAGE>
CROSS-REFERENCE TABLE/*/
<TABLE>
<CAPTION>
Section of Section of
Trust Indenture Act Guarantee
of 1939, as amended Agreement
------------------- ----------
<S> <C>
310(a)...................................................... 4.01(a)
310(b)...................................................... 4.01(c), 2.08
310(c)...................................................... Inapplicable
311(a)...................................................... 2.02(b)
311(b)...................................................... 2.02(b)
311(c)...................................................... Inapplicable
312(a)...................................................... 2.02(a)
312(b)...................................................... 2.02(b)
313......................................................... 2.03
314(a)...................................................... 2.04
314(b)...................................................... Inapplicable
314(c)...................................................... 2.05
314(d)...................................................... Inapplicable
314(e)...................................................... 1.01, 2.05, 3.02
314(f)...................................................... 2.01, 3.02
315(a)...................................................... 3.01(d)
315(b)...................................................... 2.07
315(c)...................................................... 3.01
315(d)...................................................... 3.01(d)
316(a)...................................................... 1.01, 2.06, 5.04
316(b)...................................................... 5.03
316(c)...................................................... 8.02
317(a)...................................................... Inapplicable
317(b)...................................................... Inapplicable
318(a)...................................................... 2.01(b)
318(b)...................................................... 2.01
318(c)...................................................... 2.01(a)
</TABLE>
---------
/*/ This Cross-Reference Table does not constitute part of the Guarantee
Agreement and shall not affect the interpretation of any of its terms or
provisions.
<PAGE>
GUARANTEE AGREEMENT
-------------------
This GUARANTEE AGREEMENT, dated as of __________ __, 1995, is executed
and delivered by Pacific Gas and Electric Company, a California corporation (the
"Guarantor"), and The First National Bank of Chicago, a banking association
organized under the laws of the United States, as trustee (the "Guarantee
Trustee"), for the benefit of the Holders (as defined herein) from time to time
of the Preferred Securities (as defined herein) of PG&E Capital I, a Delaware
statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Trust Agreement (the
"Trust Agreement"), dated as of _________ __, 1995 among the Issuer Trustees
named therein, the Guarantor, as Depositor, and the Holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer is
issuing up to $___________ aggregate liquidation preference of its ____%
Cumulative Quarterly Income Preferred Securities, Series A (liquidation
preference $25 per preferred security) (the "Preferred Securities") representing
preferred undivided beneficial interests in the assets of the Issuer and having
the terms set forth in the Trust Agreement;
WHEREAS, the Preferred Securities will be issued by the Issuer and the
proceeds thereof will be used to purchase the Debentures (as defined in the
Trust Agreement) of the Guarantor which will be deposited with The First
National Bank of Chicago, as Property Trustee under the Trust Agreement, as
trust assets; and
WHEREAS, as incentive for the Holders to purchase Preferred Securities
the Guarantor desires irrevocably and unconditionally to agree, to the extent
set forth herein, to pay to the Holders of the Preferred Securities the
Guarantee Payments (as defined herein) and to make certain other payments on the
terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by each Holder of
Preferred Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Guarantee Agreement for
the benefit of the Holders from time to time of the Preferred Securities.
<PAGE>
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. As used in this Guarantee Agreement, the
-----------
terms set forth below shall, unless the context otherwise requires, have the
following meanings. Capitalized or otherwise defined terms used but not
otherwise defined herein shall have the meanings assigned to such terms in the
Trust Agreement as in effect on the date hereof.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
--------
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
----------- ----------
foregoing.
"Common Securities" means the securities representing common
beneficial interests in the assets of the Issuer.
"Event of Default" means a default by the Guarantor on any of its
payment or other obligations under this Guarantee Agreement; provided, however,
that, except with respect to a default in payment of any Guarantee Payments, the
Guarantor shall have received notice of default and shall not have cured such
default within 60 days after receipt of such notice.
"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Preferred Securities, to the extent not
paid or made by or on behalf of the Issuer: (i) any accrued and unpaid
Distributions (as defined in the Trust Agreement) required to be paid on the
Preferred Securities, to the extent the Issuer shall have funds on hand
available therefor, (ii) the redemption price, including all accrued and unpaid
Distributions to the date of redemption (the "Redemption Price"), with respect
to the Preferred Securities called for redemption by the Issuer to the extent
the Issuer shall have funds on hand available therefor, and (iii) upon a
voluntary or involuntary termination, winding-up or liquidation of the Issuer,
unless Debentures are distributed to the Holders, (a) the aggregate of the
liquidation preference of $25 per Preferred Security plus accrued and
2
<PAGE>
unpaid Distributions on the Preferred Securities to the date of payment to the
extent the Issuer shall have funds on hand available to make such payment or, if
different, (b) the amount of assets of the Issuer remaining available for
distribution to Holders in liquidation of the Issuer (in either case, the
"Liquidation Distribution").
"Guarantee Trustee" means The First National Bank of Chicago, until a
Successor Guarantee Trustee has been appointed and has accepted such appointment
pursuant to the terms of this Guarantee Agreement and thereafter means each such
Successor Guarantee Trustee.
"Holder" means any holder, as registered on the books and records of
the Issuer, of any Preferred Securities; provided, however, that in determining
whether the holders of the requisite percentage of Preferred Securities have
given any request, notice, consent or waiver hereunder, "Holder" shall not
include the Guarantor or any Affiliate of the Guarantor.
"Indenture" means the Indenture dated as of __________, 1995, as
supplemented and amended to date between the Guarantor (the "Debenture Issuer")
and The First National Bank of Chicago, as trustee.
"List of Holders" has the meaning specified in Section 2.02(a).
"Majority in liquidation preference of the Securities" means, except
as provided by the Trust Indenture Act, a vote by the Holder(s), voting
separately as a class, of more than 50% of the liquidation preference of all
then outstanding Preferred Securities issued by the Issuer.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chairman of the Board, Vice Chairman of the Board, the
President, a Senior Vice President or a Vice President, and by the Treasurer, an
Assistant Treasurer, the Secretary or an Assistant Secretary of such Person, and
delivered to the Guarantee Trustee. Any Officers' Certificate delivered with
respect to compliance with a condition or covenant provided for in this
Guarantee Agreement shall include:
(a) a statement that each officer signing the Officers' Certificate
has read the covenant or condition and the definition relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each
3
<PAGE>
officer in rendering the Officers' Certificate and upon which the
statements contained therein are based;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Responsible Officer" means, with respect to the Guarantee Trustee,
any Senior Vice President, any Vice President, any Assistant Vice President, the
Secretary, any Assistant Secretary, the Treasurer, any Assistant Treasurer, any
Trust Officer or Assistant Trust Officer or any other officer of the Corporate
Trust Department of the Guarantee Trustee customarily performing functions
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of that officer's knowledge of and
familiarity with the particular subject.
"Senior Indebtedness" means Senior Indebtedness as defined in the
Indenture.
"Successor Guarantee Trustee" means a successor Guarantee Trustee
possessing the qualifications to act as Guarantee Trustee under Section 4.01.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
4
<PAGE>
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.01. Trust Indenture Act; Application.
--------------------------------
(a) This Guarantee Agreement is subject to the provisions of the
Trust Indenture Act that are required to be part of this Guarantee
Agreement and shall, to the extent applicable, be governed by such
provisions.
(b) If and to the extent that any provision of this Guarantee
Agreement limits, qualifies or conflicts with the duties imposed by Section
310 to 317, inclusive, of the Trust Indenture Act, such imposed duties
shall control.
SECTION 2.02. Lists of Holders.
----------------
(a) The Guarantor shall furnish or cause to be furnished to the
Guarantee Trustee (a) semiannually, on or before January 15 and July 15 of
each year, a list, in such form as the Guarantee Trustee may reasonably
require, of the names and addresses of the Holders ("List of Holders") as
of a date not more than 15 days prior to the delivery thereof, and (b) at
such other times as the Guarantee Trustee may request in writing, within 30
days after the receipt by the Guarantor of any such request, a List of
Holders as of a date not more than 15 days prior to the time such list is
furnished, in each case to the extent such information is in the possession
or control of the Guarantor and is not identical to a previously supplied
list of Holders or has not otherwise been received by the Guarantee Trustee
in its capacity as such. The Guarantee Trustee may destroy any List of
Holders previously given to it on receipt of a new List of Holders.
(b) The Guarantee Trustee shall comply with its obligations under
Section 311(a), Section 311(b) and Section 312(b) of the Trust Indenture
Act.
SECTION 2.03. Reports by the Guarantee Trustee. Within 60 days after
--------------------------------
December 31 of each year, the Guarantee Trustee shall provide to the Holders
such reports as are required by Section 313 of the Trust Indenture Act, if any,
in the form and in the manner provided by Section 313 of the Trust Indenture
Act. The Guarantee Trustee shall also comply with the requirements of Section
313(d) of the Trust Indenture Act.
5
<PAGE>
SECTION 2.04. Periodic Reports to Guarantee Trustee. The Guarantor
-------------------------------------
shall provide to the Guarantee Trustee, the Securities and Exchange Commission
and the Holders such documents, reports and information, if any, as required by
Section 314 of the Trust Indenture Act and the compliance certificate required
by Section 314 of the Trust Indenture Act in the form, in the manner and at the
times required by Section 314 of the Trust Indenture Act.
SECTION 2.05. Evidence of Compliance with Conditions Precedent. The
------------------------------------------------
Guarantor shall provide to the Guarantee Trustee such evidence of compliance
with such conditions precedent, if any, provided for in this Guarantee Agreement
that relate to any of the matters set forth in Section 314(c) of the Trust
Indenture Act. Any certificate or opinion required to be given by an officer
pursuant to Section 314(c)(1) may be given in the form of an Officers'
Certificate.
SECTION 2.06. Events of Default; Waiver. The Holders of a Majority
-------------------------
in liquidation preference of the Preferred Securities may, by vote, on behalf of
the Holders, waive any past Event of Default and its consequences. Upon such
waiver, any such Event of Default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been cured, for every purpose of this
Guarantee Agreement, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent therefrom.
SECTION 2.07. Event of Default; Notice.
------------------------
(a) The Guarantee Trustee shall, within 90 days after the occurrence
of an Event of Default, transmit by mail, first class postage prepaid, to
the Holders, notices of all Events of Default known to the Guarantee
Trustee, unless such defaults have been cured before the giving of such
notice, provided, that, except in the case of a default in the payment of a
Guarantee Payment, the Guarantee Trustee shall be protected in withholding
such notice if and so long as the Board of Directors, the executive
committee or a trust committee of directors and/or Responsible Officers of
the Guarantee Trustee in good faith determines that the withholding of such
notice is in the interests of the Holders.
(b) The Guarantee Trustee shall not be deemed to have knowledge of
any Event of Default unless the Guarantee Trustee shall have received
written notice, or a Responsible Officer charged with the
6
<PAGE>
administration of the Trust Agreement shall have obtained written notice,
of such Event of Default.
SECTION 2.08. Conflicting Interests. The Trust Agreement shall be
---------------------
deemed to be specifically described in this Guarantee Agreement for the purposes
of clause (i) of the first proviso contained in Section 310(b) of the Trust
Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF THE
GUARANTEE TRUSTEE
SECTION 3.01. Powers and Duties of the Guarantee Trustee.
------------------------------------------
(a) This Guarantee Agreement shall be held by the Guarantee Trustee
for the benefit of the Holders, and the Guarantee Trustee shall not
transfer this Guarantee Agreement to any Person except a Holder exercising
his or her rights pursuant to Section 5.04(iv) or to a Successor Guarantee
Trustee on acceptance by such Successor Guarantee Trustee of its
appointment to act as Successor Guarantee Trustee. The right, title and
interest of the Guarantee Trustee shall automatically vest in any Successor
Guarantee Trustee, upon acceptance by such Successor Guarantee Trustee of
its appointment hereunder, and such vesting and cessation of title shall be
effective whether or not conveyancing documents have been executed and
delivered pursuant to the appointment of such Successor Guarantee Trustee.
(b) If an Event of Default has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of
the Holders.
(c) The Guarantee Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically
set forth in this Guarantee Agreement, and no implied covenants shall be
read into this Guarantee Agreement against the Guarantee Trustee. In case
an Event of Default has occurred (that has not been cured or waived
pursuant to Section 2.06), the Guarantee Trustee shall exercise such of the
rights and powers vested in it by this Guarantee Agreement, and use the
same degree of care and skill in its exercise thereof,
7
<PAGE>
as a prudent person would exercise or use under the circumstances in the
conduct of his or her own affairs.
(d) No provision of this Guarantee Agreement shall be construed to
relieve the Guarantee Trustee from liability for its own negligent action,
its own negligent failure to act or its own willful misconduct, except
that:
(i) prior to the occurrence of any Event of Default and after
the curing or waiving of all such Events of Default that may have
occurred:
(A) the duties and obligations of the Guarantee Trustee
shall be determined solely by the express provisions of this
Guarantee Agreement, and the Guarantee Trustee shall not be
liable except for the performance of such duties and obligations
as are specifically set forth in this Guarantee Agreement; and
(B) in the absence of bad faith on the part of the
Guarantee Trustee, the Guarantee Trustee may conclusively rely,
as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions
furnished to the Guarantee Trustee and conforming to the
requirements of this Guarantee Agreement; but in the case of any
such certificates or opinions that by any provision hereof or of
the Trust Indenture Act are specifically required to be furnished
to the Guarantee Trustee, the Guarantee Trustee shall be under a
duty to examine the same to determine whether or not they conform
to the requirements of this Guarantee Agreement;
(ii) the Guarantee Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Guarantee
Trustee, unless it shall be proved that the Guarantee Trustee was
negligent in ascertaining the pertinent facts upon which such judgment
was made;
(iii) the Guarantee Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a
8
<PAGE>
Majority in liquidation preference of the Preferred Securities
relating to the time, method and place of conducting any proceeding
for any remedy available to the Guarantee Trustee, or exercising any
trust or power conferred upon the Guarantee Trustee under this
Guarantee Agreement; and
(iv) no provision of this Guarantee Agreement shall require the
Guarantee Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties
or in the exercise of any of its rights or powers, if the Guarantee
Trustee shall have reasonable grounds for believing that the repayment
of such funds or liability is not reasonably assured to it under the
terms of this Guarantee Agreement or adequate indemnity against such
risk or liability is not reasonably assured to it.
SECTION 3.02. Certain Rights of Guarantee Trustee.
-----------------------------------
(a) Subject to the provisions of Section 3.01:
(i) The Guarantee Trustee may rely and shall be fully
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be genuine
and to have been signed, sent or presented by the proper party or
parties.
(ii) Any direction or act of the Guarantor contemplated by
this Guarantee Agreement shall be sufficiently evidenced by an
Officers' Certificate unless otherwise prescribed herein.
(iii) Whenever, in the administration of this Guarantee
Agreement, the Guarantee Trustee shall deem it desirable that a matter
be proved or established before taking, suffering or omitting to take
any action hereunder, the Guarantee Trustee (unless other evidence is
herein specifically prescribed) may, in the absence of bad faith on
its part, request and rely upon an Officers' Certificate which, upon
receipt of such
9
<PAGE>
request from the Guarantee Trustee, shall be promptly delivered by the
Guarantor.
(iv) The Guarantee Trustee may consult with legal counsel, and
the written advice or opinion of such legal counsel with respect to
legal matters shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted to be taken by it
hereunder in good faith and in accordance with such advice or opinion.
Such legal counsel may be legal counsel to the Guarantor or any of its
Affiliates and may be one of its employees. The Guarantee Trustee
shall have the right at any time to seek instructions concerning the
administration of this Guarantee Agreement from any court of competent
jurisdiction.
(v) The Guarantee Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Guarantee
Agreement at the request or direction of any Holder, unless such
Holder shall have provided to the Guarantee Trustee such adequate
security and indemnity as would satisfy a reasonable person in the
position of the Guarantee Trustee, against the costs, expenses
(including attorneys' fees and expenses) and liabilities that might be
incurred by it in complying with such request or direction, including
such reasonable advances as may be requested by the Guarantee Trustee;
provided that, nothing contained in this Section 3.02(a)(v) shall be
taken to relieve the Guarantee Trustee, upon the occurrence of an
Event of Default, of its obligation to exercise the rights and powers
vested in it by this Guarantee Agreement.
(vi) The Guarantee Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Guarantee Trustee, in
its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit.
(vii) The Guarantee Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through
10
<PAGE>
its agents or attorneys, and the Guarantee Trustee shall not be
responsible for any misconduct or negligence on the part of any such
agent or attorney appointed with due care by it hereunder.
(viii) Whenever in the administration of this Guarantee
Agreement the Guarantee Trustee shall deem it desirable to receive
instructions with respect to enforcing any remedy or right or taking
any other action hereunder, the Guarantee Trustee (A) may request
instructions from the Holders, (B) may refrain from enforcing such
remedy or right or taking such other action until such instructions
are received, and (C) shall be protected in acting in accordance with
such instructions.
(b) No provision of this Guarantee Agreement shall be deemed to
impose any duty or obligation on the Guarantee Trustee to perform any act
or acts or exercise any right, power, duty or obligation conferred or
imposed on it in any jurisdiction in which it shall be illegal, or in which
the Guarantee Trustee shall be unqualified or incompetent in accordance
with applicable law, to perform any such act or acts or to exercise any
such right, power, duty or obligation. No permissive power or authority
available to the Guarantee Trustee shall be construed to be a duty to act
in accordance with such power and authority.
SECTION 3.03. Indemnity. The Guarantor agrees to indemnify the
---------
Guarantee Trustee for, and to hold it harmless against, any loss, liability or
expense incurred without negligence or bad faith on the part of the Guarantee
Trustee, arising out of or in connection with the acceptance or administration
of this Guarantee Agreement, including the costs and expenses of defending
itself against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder. The Guarantee Trustee
will not claim or exact any lien or charge on any Guarantee Payments as a result
of any amount due to it under this Guarantee Agreement.
11
<PAGE>
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 4.01. Guarantee Trustee; Eligibility.
------------------------------
(a) There shall at all times be a Guarantee Trustee which shall
(i) not be an Affiliate of the Guarantor; and
(ii) be a Person that is eligible pursuant to the Trust Indenture
Act to act as such and has a combined capital and surplus of at least
50 million U.S. dollars ($50,000,000), and shall be a corporation
meeting the requirements of Section 310(c) of the Trust Indenture Act.
If such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of the supervising or examining
authority, then, for the purposes of this Section and to the extent
permitted by the Trust Indenture Act, the combined capital and surplus
of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so
published.
(b) If at any time the Guarantee Trustee shall cease to be eligible
to so act under Section 4.01(a), the Guarantee Trustee shall immediately
resign in the manner and with the effect set out in Section 4.02(c).
(c) If the Guarantee Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act,
the Guarantee Trustee and Guarantor shall in all respects comply with the
provisions of Section 310(b) of the Trust Indenture Act.
12
<PAGE>
SECTION 4.02. Appointment, Removal and Resignation of the Guarantee
-----------------------------------------------------
Trustee.
-------
(a) Subject to Section 4.02(b), the Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed until a Successor
Guarantee Trustee has been appointed and has accepted such appointment by
written instrument executed by such Successor Guarantee Trustee and
delivered to the Guarantor.
(c) The Guarantee Trustee appointed hereunder shall hold office until
a Successor Guarantee Trustee shall have been appointed or until its
removal or resignation. The Guarantee Trustee may resign from office
(without need for prior or subsequent accounting) by an instrument in
writing executed by the Guarantee Trustee and delivered to the Guarantor,
which resignation shall not take effect until a Successor Guarantee Trustee
has been appointed and has accepted such appointment by instrument in
writing executed by such Successor Guarantee Trustee and delivered to the
Guarantor and the resigning Guarantee Trustee.
(d) If no Successor Guarantee Trustee shall have been appointed and
accepted appointment as provided in this Section 4.02 within 60 days after
delivery to the Guarantor of an instrument of resignation, the resigning
Guarantee Trustee may petition, at the expense of the Guarantor, any court
of competent jurisdiction for appointment of a Successor Guarantee Trustee.
Such court may thereupon, after prescribing such notice, if any, as it may
deem proper, appoint a Successor Guarantee Trustee.
ARTICLE V
GUARANTEE
SECTION 5.01. Guarantee. The Guarantor irrevocably and
---------
unconditionally agrees to pay in full to the Holders the Guarantee Payments
(without duplication of amounts theretofore paid by or on behalf of the Issuer),
as and when due, regardless of any defense, right of set-off or counterclaim
which the Issuer may have or assert. The Guarantor's obligation to make a
Guarantee Payment may be satisfied by direct payment of the required amounts by
the
13
<PAGE>
Guarantor to the Holders or by causing the Issuer to pay such amounts to the
Holders.
SECTION 5.02. Waiver of Notice and Demand. The Guarantor hereby
---------------------------
waives notice of acceptance of the Guarantee Agreement and of any liability to
which it applies or may apply, presentment, demand for payment, any right to
require a proceeding first against the Guarantee Trustee, Issuer or any other
Person before proceeding against the Guarantor, protest, notice of nonpayment,
notice of dishonor, notice of redemption and all other notices and demands.
SECTION 5.03. Obligations Not Affected. The obligations, covenants,
------------------------
agreements and duties of the Guarantor under this Guarantee Agreement shall in
no way be affected or impaired by reason of the happening from time to time of
any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied
agreement, covenant, term or condition relating to the Preferred Securities
to be performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or any
portion of the Distributions (other than an extension of time for payment
of Distributions that results from the extension of any interest payment
period on the Debentures as so provided in the Indenture), Redemption
Price, Liquidation Distribution or any other sums payable under the terms
of the Preferred Securities or the extension of time for the performance of
any other obligation under, arising out of, or in connection with, the
Preferred Securities;
(c) any failure, omission, delay or lack of diligence on the part of
the Holders to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Holders pursuant to the terms of the Preferred
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of
any collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or
readjustment of debt of, or other similar proceedings affecting, the Issuer
or any of the assets of the Issuer;
14
<PAGE>
(e) any invalidity of, or defect or deficiency in, the Preferred
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute
a legal or equitable discharge or defense of a guarantor, it being the
intent of this Section 5.03 that the obligations of the Guarantor hereunder
shall be absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain the
consent of, the Guarantor with respect to the happening of any of the foregoing.
SECTION 5.04. Rights of Holders. The Guarantor expressly
-----------------
acknowledges that: (i) this Guarantee Agreement will be deposited with the
Guarantee Trustee to be held for the benefit of the Holders; (ii) the Guarantee
Trustee has the right to enforce this Guarantee Agreement on behalf of the
Holders; (iii) the Holders of a Majority in liquidation preference of the
Preferred Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee in
respect of this Guarantee Agreement or exercising any trust or power conferred
upon the Guarantee Trustee under this Guarantee Agreement; and (iv) if the
Guarantee Trustee fails to enforce this Guarantee Agreement as above provided,
any Holder may, after a period of 30 days has elapsed from such Holder's written
request to the Guarantee Trustee to enforce this Guarantee Agreement, institute
a legal proceeding directly against the Guarantor to enforce its rights under
this Guarantee Agreement, without first instituting a legal proceeding against
the Guarantee Trustee, the Issuer or any other Person.
SECTION 5.05. Guarantee of Payment. This Guarantee Agreement creates
--------------------
a guarantee of payment and not of collection. This Guarantee Agreement will not
be discharged except by payment of the Guarantee Payments in full (without
duplication of amounts theretofore paid by the Issuer) or upon distribution of
Debentures to Holders as provided in the Trust Agreement.
SECTION 5.06. Subrogation. The Guarantor shall be subrogated to all
-----------
(if any) rights of the Holders against the Issuer in respect of any amounts paid
to the Holders by the Guarantor under this Guarantee Agreement and shall have
the right to waive payment by the Issuer pursuant to Section
15
<PAGE>
5.01; provided, however, that the Guarantor shall not (except to the extent
-------- -------
required by mandatory provisions of law) be entitled to enforce or exercise any
rights which it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of payment under this
Guarantee Agreement, if, at the time of any such payment, any amounts are due
and unpaid under this Guarantee Agreement. If any amount shall be paid to the
Guarantor in violation of the preceding sentence, the Guarantor agrees to hold
such amount in trust for the Holders and to pay over such amount to the Holders.
SECTION 5.07. Independent Obligations. The Guarantor acknowledges
-----------------------
that its obligations hereunder are independent of the obligations of the Issuer
with respect to the Preferred Securities and that the Guarantor shall be liable
as principal and as debtor hereunder to make Guarantee Payments pursuant to the
terms of this Guarantee Agreement notwithstanding the occurrence of any event
referred to in subsections (a) through (g), inclusive, of Section 5.03 hereof.
ARTICLE VI
COVENANTS AND SUBORDINATION
SECTION 6.01. Subordination. This Guarantee Agreement will
-------------
constitute an unsecured obligation of the Guarantor and will rank subordinate
and junior in right of payment to all liabilities of the Guarantor, including
the Debentures, except those made pari passu or subordinate to the Guarantee
expressly by their terms.
SECTION 6.02. Pari Passu Guarantees. This Guarantee Agreement shall
---------------------
rank pari passu with any similar Guarantee Agreements issued by the Guarantor on
behalf of the holders of Preferred Securities issued by PG&E Capital II, PG&E
Capital III and PG&E Capital IV.
ARTICLE VII
TERMINATION
SECTION 7.01. Termination. This Guarantee Agreement shall terminate
-----------
and be of no further force and effect upon (i) full payment of the Redemption
Price of all Preferred Securities, (ii) the distribution of Debentures to the
Holders in exchange for all of the Preferred Securities or (iii) full payment of
the amounts payable in accordance
16
<PAGE>
with the Trust Agreement upon liquidation of the Issuer. Notwithstanding the
foregoing, this Guarantee Agreement will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder must restore payment
of any sums paid with respect to Preferred Securities or this Guarantee
Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Successors and Assigns. All guarantees and agreements
----------------------
contained in this Guarantee Agreement shall bind the successors, assigns,
receivers, trustees and representatives of the Guarantor and shall inure to the
benefit of the Holders of the Preferred Securities then outstanding. Except in
connection with a consolidation, merger or sale involving the Guarantor that is
permitted under Article Eight of the Indenture and pursuant to which the
assignee agrees in writing to perform the Guarantor's obligations hereunder, the
Guarantor shall not assign its obligations hereunder.
SECTION 8.02. Amendments. Except with respect to any changes which
----------
do not adversely affect the rights of the Holders in any material respect (in
which case no consent of the Holders will be required), this Guarantee Agreement
may only be amended with the prior approval of the Holders of not less than a
Majority in liquidation preference of all the outstanding Preferred Securities.
The provisions of Article VI of the Trust Agreement concerning meetings of the
Holders shall apply to the giving of such approval.
SECTION 8.03. Notices. Any notice, request or other communication
-------
required or permitted to be given hereunder shall be in writing, duly signed by
the party giving such notice, and delivered, telecopied or mailed by first class
mail as follows:
(a) if given to the Guarantor, to the address set forth below or such
other address as the Guarantor may give notice of to the Holders:
Pacific Gas and Electric Company
77 Beale Street
P.O. Box 770000
San Francisco, CA 94120
Facsimile No: (415) 973-7000
Attention: Treasurer
17
<PAGE>
(b) if given to the Issuer, in care of the Guarantee Trustee, at the
Issuer's (and the Guarantee Trustee's) address set forth below or such
other address as the Guarantee Trustee on behalf of the Issuer may give
notice to the Holders:
PG&E Capital I
c/o Pacific Gas and Electric Company
77 Beale Street
P.O. Box 770000
San Francisco, CA 94120
Facsimile No: (415) 973-7059
Attention: Treasurer
with a copy to:
First National Bank of Chicago
One First National Plaza
Suite 0126
Chicago, Illinois 60670-0126
Facsimile No: (312) 407-4656
Attention: Corporate Trust Services Division
(c) if given to any Holder, at the address set forth on the books and
records of the Issuer.
All notices hereunder shall be deemed to have been given when received
in person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 8.04. Benefit. This Guarantee Agreement is solely for the
-------
benefit of the Holders and is not separately transferable from the Preferred
Securities.
SECTION 8.05. Interpretation. In this Guarantee Agreement, unless
--------------
the context otherwise requires:
18
<PAGE>
(a) Capitalized terms used in this Guarantee Agreement but not
defined in the preamble hereto have the respective meanings assigned to
them in Section 1.01;
(b) a term defined anywhere in this Guarantee Agreement has the same
meaning throughout;
(c) all references to "the Guarantee Agreement" or "this Guarantee
Agreement" are to this Guarantee Agreement as modified, supplemented or
amended from time to time;
(d) all references in this Guarantee Agreement to Articles and
Sections are to Articles and Sections of this Guarantee Agreement unless
otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning
when used in this Guarantee Agreement unless otherwise defined in this
Guarantee Agreement or unless the context otherwise requires;
(f) a reference to the singular includes the plural and vice versa;
and
(g) the masculine, feminine or neuter genders used herein shall
include the masculine, feminine and neuter genders.
SECTION 8.06. GOVERNING LAW. THIS GUARANTEE AGREEMENT SHALL BE
-------------
GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF CALIFORNIA WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
19
<PAGE>
THIS GUARANTEE AGREEMENT is executed as of the day and year first
above written.
PACIFIC GAS AND ELECTRIC COMPANY
By:
-----------------------------------------------
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO, as Guarantee
Trustee
By:
-----------------------------------------------
Name:
Title:
20
<PAGE>
EXHIBIT 5.1
San Francisco, California
August 18, 1995
Pacific Gas and Electric Company
77 Beale Street
P.O. Box 770000
San Francisco, California 94177
Re: $335,000,000 aggregate principal amount of Cumulative Quarterly Income
----------------------------------------------------------------------
Preferred Securities to be issued by PG&E Capital I, PG&E Capital II,
---------------------------------------------------------------------
PG&E Capital III and PG&E Capital IV (the "Trusts") and Guarantees
------------------------------------------------------------------
with respect to the Preferred Securities (the "Guarantees") and
---------------------------------------------------------------
Deferrable Interest Subordinated Debentures (the "Subordinated
--------------------------------------------------------------
Debentures") in one or more series, to be issued by Pacific Gas and
-------------------------------------------------------------------
Electric Company (the "Company").
---------------------------------
Ladies and Gentlemen:
I submit the following opinion to be used in connection with the Registration
Statement on Form S-3 (the "Registration Statement") to be filed with the
Securities and Exchange Commission covering the above-designated Preferred
Securities, Guarantees relating to the Preferred Securities and the Subordinated
Debentures. All capitalized terms used herein unless defined herein shall have
the meanings specified in the Registration Statement.
I and/or attorneys working under my supervision have conducted such
investigations of laws and regulations as I have deemed necessary or appropriate
for the purpose of rendering the opinions hereinafter expressed.
The opinions expressed below are based on the following assumptions:
(a) The Registration Statement filed by the Company and the Trusts with
respect to the Preferred Securities, the Guarantees and the Subordinated
Debentures will become effective;
(b) The proposed transactions will be carried out on the basis set forth in
the Registration Statement and in conformity with the authorizations,
approvals, consents or exemptions under the securities laws of various
states and other jurisdictions of the United States;
<PAGE>
Pacific Gas and Electric Company
August 18, 1995
Page 2
(c) Prior to issuance of any series of Preferred Securities, Guarantees
and Subordinated Debentures:
(i) the depositor of the Trust will authorize the issuance of, and
determine the terms of, such series of Preferred Securities;
(ii) the Indenture will have been executed and delivered by the
Company, and the Board of Directors of the Company, or a committee
thereof, or an officer pursuant to authority delegated by the Board of
Directors, will have authorized the issuance of, and established the
terms of, the series of the Subordinated Debentures related to such
series of Preferred Securities;
(iii) the Guarantee related to such series of Preferred Securities
will have been executed and delivered by the Company in accordance
with appropriate resolutions of the Board of Directors of the Company,
or a committee thereof, or an officer pursuant to authority delegated
by the Board of Directors; and
(iv) the California Public Utilities Commission shall have issued
orders authorizing the Company to issue, sell and deliver the
Subordinated Debentures and the Guarantees relating to the Preferred
Securities to be issued by the Trust and each other action proposed or
contemplated by the Registration Statement.
(d) The Indenture and the Guarantees will have been qualified in
accordance with the provisions of the Trust Indenture Act of 1939, as
amended.
Based upon the foregoing and subject to the limitations herein, I am of the
opinion that:
1. The Company is a corporation duly organized and validly existing and
authorized to exercise its corporate powers, rights and privileges under the
laws of the State of California.
2. When properly executed, authenticated, delivered and paid for as
provided in the Indenture, the Subordinated Debentures will be legally issued,
valid and binding obligations of the Company.
<PAGE>
Pacific Gas and Electric Company
August 18, 1995
Page 3
3. When executed and delivered by the Company, the Guarantees will be
valid and binding obligations of the Company.
The opinions in paragraphs 2 and 3 above are limited by the effect of (i)
bankruptcy, insolvency, reorganization, receivership, moratorium and other
similar laws affecting the rights and remedies of creditors generally, (ii)
public policy on the enforceability of provisions relating to indemnification or
contribution, (iii) limitations or restrictions on waiver and waivers of future
acts, and (iv) general principles of equity (regardless of whether considered in
a proceeding in equity or at law), including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, and the possible
unavailability of specific performance or injunctive relief.
I express no opinions as to matters of law in jurisdictions other then the State
of California. My opinions are rendered only with respect to California laws and
rules, regulations and orders thereunder which are currently in effect.
I hereby consent to the use of this opinion as Exhibit 5.1 to the Registration
Statement and to the references to me in the Prospectus and Prospectus
Supplement contained therein.
Respectfully submitted,
Gary P. Encinas
GARY P. ENCINAS
Chief Counsel, Corporate
PACIFIC GAS AND ELECTRIC COMPANY
<PAGE>
Exhibit 5-2
RICHARDS, LAYTON & FINGER
August 18, 1995
PG&E Capital I
c/o Pacific Gas and Electric Company
77 Beale Street
P.O. Box 770000
San Francisco, California 94177
Re: PG&E Capital I
Ladies and Gentlemen:
We have acted as special Delaware counsel for Pacific Gas and Electric
Company, a California corporation ("PG&E"), and PG&E Capital I, a Delaware
business trust (the "Trust"), in connection with the matters set forth herein.
At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our examination
of documents has been limited to the examination of originals or copies of the
following:
(a) The Certificate of Trust of the Trust, dated as of August 14, 1995
(the "Certificate"), as filed in the office of the Secretary of State of
the State of Delaware (the "Secretary of State") on August 17, 1995;
(b) The Trust Agreement of the Trust, dated as of August 14, 1995,
between PG&E and the trustees of the Trust named therein;
(c) The Registration Statement (the "Registration Statement") on Form S-
3, including a preliminary prospectus (the "Prospectus"), and a preliminary
prospectus supplement (the "Prospectus Supplement") relating to the %
Cumulative Quarterly Income Preferred Securities of the Trust representing
preferred undivided beneficial interests in the assets of the Trust (each,
a "Preferred Security" and collectively, the "Preferred Securities"), as
proposed to be filed by PG&E, the Trust and others as set forth therein
with the Securities and Exchange Commission on August 18, 1995;
(d) A form of Amended and Restated Trust Agreement of the Trust, to be
entered into among PG&E, the trustees of the Trust named therein, and the
holders, from time to time, of undivided beneficial interests in the assets
of the Trust (including Exhibits C and E thereto) (the "Trust Agreement"),
attached as an exhibit to the Registration Statement; and
(e) A Certificate of Good Standing for the Trust, dated August 18, 1995,
obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are used
as defined in the Trust Agreement.
For purposes of this opinion, we have not reviewed any documents other than
the documents listed in paragraphs (a) through (e) above. In particular, we
have not reviewed any document (other than the documents listed in paragraphs
(a) through (e) above) that is referred to in or incorporated by reference
into the documents reviewed by us. We have assumed that there exists no
provision in any document that we have not reviewed that is inconsistent with
the opinions stated herein. We have conducted no independent factual
investigation of our own but rather have relied solely upon the foregoing
documents, the statements and information set forth therein and the additional
matters
<PAGE>
recited or assumed herein, all of which we have assumed to be true, complete
and accurate in all material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Trust Agreement
constitutes the entire agreement among the parties thereto with respect to the
subject matter thereof, including with respect to the creation, operation and
termination of the Trust, and that the Trust Agreement and the Certificate are
in full force and effect and have not been amended, (ii) except to the extent
provided in paragraph 1 below, the due creation or due organization or due
formation, as the case may be, and valid existence in good standing of each
party to the documents examined by us under the laws of the jurisdiction
governing its creation, organization or formation, (iii) the legal capacity of
natural persons who are parties to the documents examined by us, (iv) that
each of the parties to the documents examined by us has the power and
authority to execute and deliver, and to perform its obligations under, such
documents, (v) the due authorization, execution and delivery by all parties
thereto of all documents examined by us, (vi) the receipt by each Person to
whom a Preferred Security is to be issued by the Trust (collectively, the
"Preferred Security Holders") of a Preferred Security Certificate for such
Preferred Security and the payment for the Preferred Security acquired by it,
in accordance with the Trust Agreement and the Registration Statement, and
(vii) that the Preferred Securities are issued and sold to the Preferred
Security Holders in accordance with the Trust Agreement and the Registration
Statement. We have not participated in the preparation of the Registration
Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware (excluding the
securities laws of the State of Delaware), and we have not considered and
express no opinion on the laws of any other jurisdiction, including federal
laws and rules and regulations relating thereto. Our opinions are rendered
only with respect to Delaware laws and rules, regulations and orders
thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such questions of law
and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act.
2. The Preferred Securities will represent valid and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the Trust,
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Preferred
Security Holders may be obligated to make payments as set forth in the
Trust Agreement.
We consent to the filing of this opinion with the Securities and Exchange
Commission as an exhibit to the Registration Statement. In addition, we hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus. In giving the foregoing consents, we do not thereby admit that we
come within the category of Persons whose consent is required under Section 7
of the
<PAGE>
Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission thereunder. Except as stated above, without
our prior written consent, this opinion may not be furnished or quoted to, or
relied upon by, any other Person for any purpose.
Very truly yours,
Richards, Layton & Finger
<PAGE>
EXHIBIT 5-3
RICHARDS, LAYTON & FINGER
August 18, 1995
PG&E Capital II
c/o Pacific Gas and Electric Company
77 Beale Street
P.O. Box 770000
San Francisco, California 94177
Re: PG&E Capital II
Ladies and Gentlemen:
We have acted as special Delaware counsel for Pacific Gas and Electric
Company, a California corporation ("PG&E"), and PG&E Capital II, a Delaware
business trust (the "Trust"), in connection with the matters set forth herein.
At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our examination
of documents has been limited to the examination of originals or copies of the
following:
(a) The Certificate of Trust of the Trust, dated as of August 14, 1995
(the "Certificate"), as filed in the office of the Secretary of State of
the State of Delaware (the "Secretary of State") on August 17, 1995;
(b) The Trust Agreement of the Trust, dated as of August 14, 1995,
between PG&E and the trustees of the Trust named therein;
(c) The Registration Statement (the "Registration Statement") on Form S-
3, including a preliminary prospectus (the "Prospectus"), and a preliminary
prospectus supplement (the "Prospectus Supplement") relating to the %
Cumulative Quarterly Income Preferred Securities of the Trust representing
preferred undivided beneficial interests in the assets of the Trust (each,
a "Preferred Security" and collectively, the "Preferred Securities"), as
proposed to be filed by PG&E, the Trust and others as set forth therein
with the Securities and Exchange Commission on August 18, 1995;
(d) A form of Amended and Restated Trust Agreement of the Trust, to be
entered into among PG&E, the trustees of the Trust named therein, and the
holders, from time to time, of undivided beneficial interests in the assets
of the Trust (including Exhibits C and E thereto) (the "Trust Agreement"),
attached as an exhibit to the Registration Statement; and
(e) A Certificate of Good Standing for the Trust, dated August 18, 1995,
obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are used
as defined in the Trust Agreement.
For purposes of this opinion, we have not reviewed any documents other than
the documents listed in paragraphs (a) through (e) above. In particular, we
have not reviewed any document (other than the documents listed in paragraphs
(a) through (e) above) that is referred to in or incorporated by reference
into the documents reviewed by us. We have assumed that there exists no
provision in any document that we have not reviewed that is inconsistent with
the opinions stated herein. We have conducted no independent factual
investigation of our own but rather have relied solely upon the foregoing
documents, the statements and information set forth therein and the additional
matters
<PAGE>
recited or assumed herein, all of which we have assumed to be true, complete
and accurate in all material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Trust Agreement
constitutes the entire agreement among the parties thereto with respect to the
subject matter thereof, including with respect to the creation, operation and
termination of the Trust, and that the Trust Agreement and the Certificate are
in full force and effect and have not been amended, (ii) except to the extent
provided in paragraph 1 below, the due creation or due organization or due
formation, as the case may be, and valid existence in good standing of each
party to the documents examined by us under the laws of the jurisdiction
governing its creation, organization or formation, (iii) the legal capacity of
natural persons who are parties to the documents examined by us, (iv) that
each of the parties to the documents examined by us has the power and
authority to execute and deliver, and to perform its obligations under, such
documents, (v) the due authorization, execution and delivery by all parties
thereto of all documents examined by us, (vi) the receipt by each Person to
whom a Preferred Security is to be issued by the Trust (collectively, the
"Preferred Security Holders") of a Preferred Security Certificate for such
Preferred Security and the payment for the Preferred Security acquired by it,
in accordance with the Trust Agreement and the Registration Statement, and
(vii) that the Preferred Securities are issued and sold to the Preferred
Security Holders in accordance with the Trust Agreement and the Registration
Statement. We have not participated in the preparation of the Registration
Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware (excluding the
securities laws of the State of Delaware), and we have not considered and
express no opinion on the laws of any other jurisdiction, including federal
laws and rules and regulations relating thereto. Our opinions are rendered
only with respect to Delaware laws and rules, regulations and orders
thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such questions of law
and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act.
2. The Preferred Securities will represent valid and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the Trust,
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Preferred
Security Holders may be obligated to make payments as set forth in the
Trust Agreement.
We consent to the filing of this opinion with the Securities and Exchange
Commission as an exhibit to the Registration Statement. In addition, we hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus. In giving the foregoing consents, we do not thereby admit
<PAGE>
that we come 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 thereunder. Except as
stated above, without our prior written consent, this opinion may not be
furnished or quoted to, or relied upon by, any other Person for any purpose.
Very truly yours,
Richards, Layton & Finger
<PAGE>
EXHIBIT 5-4
RICHARDS, LAYTON & FINGER
August 18, 1995
PG&E Capital III
c/o Pacific Gas and Electric Company
77 Beale Street
P.O. Box 770000
San Francisco, California 94177
Re: PG&E Capital III
Ladies and Gentlemen:
We have acted as special Delaware counsel for Pacific Gas and Electric
Company, a California corporation ("PG&E"), and PG&E Capital III, a Delaware
business trust (the "Trust"), in connection with the matters set forth herein.
At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our examination
of documents has been limited to the examination of originals or copies of the
following:
(a) The Certificate of Trust of the Trust, dated as of August 14, 1995
(the "Certificate"), as filed in the office of the Secretary of State of
the State of Delaware (the "Secretary of State") on August 17, 1995;
(b) The Trust Agreement of the Trust, dated as of August 14, 1995,
between PG&E and the trustees of the Trust named therein;
(c) Amendment No. 1 to the Registration Statement (the "Registration
Statement") on Form S-3, including a preliminary prospectus (the
"Prospectus"), and a preliminary prospectus supplement (the "Prospectus
Supplement") relating to the % Cumulative Quarterly Income Preferred
Securities of the Trust representing preferred undivided beneficial
interests in the assets of the Trust (each, a "Preferred Security" and
collectively, the "Preferred Securities"), as proposed to be filed by PG&E,
the Trust and others as set forth therein with the Securities and Exchange
Commission on August 18, 1995;
(d) A form of Amended and Restated Trust Agreement of the Trust, to be
entered into among PG&E, the trustees of the Trust named therein, and the
holders, from time to time, of undivided beneficial interests in the assets
of the Trust (including Exhibits C and E thereto) (the "Trust Agreement"),
attached as an exhibit to the Registration Statement; and
(e) A Certificate of Good Standing for the Trust, dated August 18, 1995,
obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are used
as defined in the Trust Agreement.
For purposes of this opinion, we have not reviewed any documents other than
the documents listed in paragraphs (a) through (e) above. In particular, we
have not reviewed any document (other than the documents listed in paragraphs
(a) through (e) above) that is referred to in or incorporated by reference
into the documents reviewed by us. We have assumed that there exists no
provision in any document that we have not reviewed that is inconsistent with
the opinions stated herein. We have conducted no independent factual
investigation of our own but rather have relied solely upon the
<PAGE>
foregoing documents, the statements and information set forth therein and the
additional matters recited or assumed herein, all of which we have assumed to
be true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Trust Agreement
constitutes the entire agreement among the parties thereto with respect to the
subject matter thereof, including with respect to the creation, operation and
termination of the Trust, and that the Trust Agreement and the Certificate are
in full force and effect and have not been amended, (ii) except to the extent
provided in paragraph 1 below, the due creation or due organization or due
formation, as the case may be, and valid existence in good standing of each
party to the documents examined by us under the laws of the jurisdiction
governing its creation, organization or formation, (iii) the legal capacity of
natural persons who are parties to the documents examined by us, (iv) that
each of the parties to the documents examined by us has the power and
authority to execute and deliver, and to perform its obligations under, such
documents, (v) the due authorization, execution and delivery by all parties
thereto of all documents examined by us, (vi) the receipt by each Person to
whom a Preferred Security is to be issued by the Trust (collectively, the
"Preferred Security Holders") of a Preferred Security Certificate for such
Preferred Security and the payment for the Preferred Security acquired by it,
in accordance with the Trust Agreement and the Registration Statement, and
(vii) that the Preferred Securities are issued and sold to the Preferred
Security Holders in accordance with the Trust Agreement and the Registration
Statement. We have not participated in the preparation of the Registration
Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware (excluding the
securities laws of the State of Delaware), and we have not considered and
express no opinion on the laws of any other jurisdiction, including federal
laws and rules and regulations relating thereto. Our opinions are rendered
only with respect to Delaware laws and rules, regulations and orders
thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such questions of law
and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act.
2. The Preferred Securities will represent valid and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the Trust,
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Preferred
Security Holders may be obligated to make payments as set forth in the
Trust Agreement.
We consent to the filing of this opinion with the Securities and Exchange
Commission as an exhibit to the Registration Statement. In addition, we hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus. In giving the foregoing consents, we do not thereby admit that we
come within the category of Persons whose consent is required under Section 7
of the
<PAGE>
Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission thereunder. Except as stated above, without
our prior written consent, this opinion may not be furnished or quoted to, or
relied upon by, any other Person for any purpose.
Very truly yours,
Richards, Layton & Finger
<PAGE>
EXHIBIT 5-5
RICHARDS, LAYTON & FINGER
August 18, 1995
PG&E Capital IV
c/o Pacific Gas and Electric Company
77 Beale Street
P.O. Box 770000
San Francisco, California 94177
Re: PG&E Capital IV
Ladies and Gentlemen:
We have acted as special Delaware counsel for Pacific Gas and Electric
Company, a California corporation ("PG&E"), and PG&E Capital IV, a Delaware
business trust (the "Trust"), in connection with the matters set forth herein.
At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our examination
of documents has been limited to the examination of originals or copies of the
following:
(a) The Certificate of Trust of the Trust, dated as of August 14, 1995
(the "Certificate"), as filed in the office of the Secretary of State of
the State of Delaware (the "Secretary of State") on August 17, 1995;
(b) The Trust Agreement of the Trust, dated as of August 14, 1995,
between PG&E and the trustees of the Trust named therein;
(c) Amendment No. 1 to the Registration Statement (the "Registration
Statement") on Form S-3, including a preliminary prospectus (the
"Prospectus"), and a preliminary prospectus supplement (the "Prospectus
Supplement") relating to the % Cumulative Quarterly Income Preferred
Securities of the Trust representing preferred undivided beneficial
interests in the assets of the Trust (each, a "Preferred Security" and
collectively, the "Preferred Securities"), as proposed to be filed by PG&E,
the Trust and others as set forth therein with the Securities and Exchange
Commission on August 18, 1995;
(d) A form of Amended and Restated Trust Agreement of the Trust, to be
entered into among PG&E, the trustees of the Trust named therein, and the
holders, from time to time, of undivided beneficial interests in the assets
of the Trust (including Exhibits C and E thereto) (the "Trust Agreement"),
attached as an exhibit to the Registration Statement; and
(e) A Certificate of Good Standing for the Trust, dated August 18, 1995,
obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are used
as defined in the Trust Agreement.
For purposes of this opinion, we have not reviewed any documents other than
the documents listed in paragraphs (a) through (e) above. In particular, we
have not reviewed any document (other than the documents listed in paragraphs
(a) through (e) above) that is referred to in or incorporated by reference
into the documents reviewed by us. We have assumed that there exists no
provision in any document that we have not reviewed that is inconsistent with
the opinions stated herein. We have conducted no independent factual
investigation of our own but rather have relied solely upon the
<PAGE>
foregoing documents, the statements and information set forth therein and the
additional matters recited or assumed herein, all of which we have assumed to
be true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Trust Agreement
constitutes the entire agreement among the parties thereto with respect to the
subject matter thereof, including with respect to the creation, operation and
termination of the Trust, and that the Trust Agreement and the Certificate are
in full force and effect and have not been amended, (ii) except to the extent
provided in paragraph 1 below, the due creation or due organization or due
formation, as the case may be, and valid existence in good standing of each
party to the documents examined by us under the laws of the jurisdiction
governing its creation, organization or formation, (iii) the legal capacity of
natural persons who are parties to the documents examined by us, (iv) that
each of the parties to the documents examined by us has the power and
authority to execute and deliver, and to perform its obligations under, such
documents, (v) the due authorization, execution and delivery by all parties
thereto of all documents examined by us, (vi) the receipt by each Person to
whom a Preferred Security is to be issued by the Trust (collectively, the
"Preferred Security Holders") of a Preferred Security Certificate for such
Preferred Security and the payment for the Preferred Security acquired by it,
in accordance with the Trust Agreement and the Registration Statement, and
(vii) that the Preferred Securities are issued and sold to the Preferred
Security Holders in accordance with the Trust Agreement and the Registration
Statement. We have not participated in the preparation of the Registration
Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware (excluding the
securities laws of the State of Delaware), and we have not considered and
express no opinion on the laws of any other jurisdiction, including federal
laws and rules and regulations relating thereto. Our opinions are rendered
only with respect to Delaware laws and rules, regulations and orders
thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such questions of law
and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act.
2. The Preferred Securities will represent valid and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the Trust,
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Preferred
Security Holders may be obligated to make payments as set forth in the
Trust Agreement.
We consent to the filing of this opinion with the Securities and Exchange
Commission as an exhibit to the Registration Statement. In addition, we hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus. In giving the foregoing consents, we do not thereby admit
<PAGE>
that we come 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 thereunder. Except as
stated above, without our prior written consent, this opinion may not be
furnished or quoted to, or relied upon by, any other Person for any purpose.
Very truly yours,
Richards, Layton & Finger
<PAGE>
EXHIBIT 8
BALLARD SPAHR ANDREWS & INGERSOLL
August 18, 1995
Pacific Gas and Electric Company
77 Beale Street
P.O. Box 770000
San Francisco, CA 94177
Ladies and Gentlemen:
We have acted as special counsel to you (the "Company") in connection with
the registration of an aggregate of $335,000,000 stated liquidation preference
of Cumulative Quarterly Income Preferred Securities of PG&E Capital I, PG&E
Capital II, PG&E Capital III and PG&E Capital IV, each a Delaware business
trust, and the related Guarantees and % Deferrable Interest Subordinated
Debentures of the Company. We hereby confirm to you our opinions as set forth
under the heading "United States Taxation" in the Prospectus Supplement
included in the Registration Statement and consent to the references to us
therein and in the related Prospectus.
Very truly yours,
Ballard Spahr Andrews & Ingersoll
<PAGE>
Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports dated February 6, 1995,
included or incorporated by reference in Pacific Gas and Electric Company's Form
10-K for the year ended December 31, 1994, and to all references to our Firm
included in this registration statement.
ARTHUR ANDERSEN LLP
San Francisco, California
August 18, 1995
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
Each of the undersigned Directors of Pacific Gas and Electric Company
hereby constitutes and appoints LESLIE H. EVERETT, LINDA Y.H. CHENG, KATHLEEN
RUEGER, GARY P. ENCINAS, JULIE C. GAVIN, DOREEN A. LUDEMANN, GRACE U. SHIN or
ANNIE M. TILLERY his or her attorneys with full power of substitution to sign
and file with the Securities and Exchange Commission in his or her capacity as
such Director of said corporation the registration statement or statements
covering the issue and sale, in one or more series, of not exceeding
$400,000,000 aggregate principal amount or liquidation value of securities
consisting of unsecured subordinated debentures, notes or other debt, and
related guarantees, and any and all amendments thereto, and hereby ratifies all
that said attorneys or any of them may do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, we have signed these presents as of this 4th day
of August, 1995.
RICHARD A. CLARKE WILLIAM F. MILLER
H.M. CONGER REBECCA Q. MORGAN
WILLIAM S. DAVILA JOHN B.M. PLACE
ROBERT D. GLYNN, JR. SAMUEL T. REEVES
RICHARD B. MADDEN CARL E. REICHARDT
GEORGE A. MANEATIS JOHN C. SAWHILL
MARY S. METZ ALAN SEELENFREUND
<PAGE>
POWER OF ATTORNEY
STANLEY T. SKINNER, the undersigned, Chairman of the Board, Chief
Executive Officer, and Director of Pacific Gas and Electric Company, hereby
constitutes and appoints LESLIE H. EVERETT, LINDA Y.H. CHENG, KATHLEEN RUEGER,
GARY P. ENCINAS, JULIE C. GAVIN, GRACE U. SHIN or ANNIE M. TILLERY his attorneys
with full power of substitution to sign and file with the Securities and
Exchange Commission in his capacity as Chairman of the Board, Chief Executive
Officer, and Director of said corporation the registration statement or
statements covering the issue and sale, in one or more series, of not exceeding
$400,000,000 aggregate principal amount or liquidation value of securities
consisting of unsecured subordinated debentures, notes or other debt, and
related guarantees, and any and all amendments thereto, and hereby ratifies all
that said attorneys or any of them may do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have signed these presents as of this 4th day of
August, 1995.
STANLEY T. SKINNER
___________________________________
STANLEY T. SKINNER
<PAGE>
POWER OF ATTORNEY
GORDON R. SMITH, the undersigned, Senior Vice President and Chief
Financial Officer of Pacific Gas and Electric Company, hereby constitutes and
appoints LESLIE H. EVERETT, LINDA Y.H. CHENG, KATHLEEN RUEGER, GARY P. ENCINAS,
JULIE C. GAVIN, GRACE U. SHIN or ANNIE M. TILLERY his attorneys with full power
of substitution to sign and file with the Securities and Exchange Commission in
his capacity as Senior Vice President and Chief Financial Officer of said
corporation the registration statement or statements covering the issue and
sale, in one or more series, of not exceeding $400,000,000 aggregate principal
amount or liquidation value of securities consisting of unsecured subordinated
debentures, notes or other debt, and related guarantees, and any and all
amendments thereto, and hereby ratifies all that said attorneys or any of them
may do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have signed these presents as of this 4th day of
August, 1995.
GORDON R. SMITH
___________________________________
GORDON R. SMITH
<PAGE>
POWER OF ATTORNEY
THOMAS C. LONG, the undersigned, Vice President and Controller of
Pacific Gas and Electric Company, hereby constitutes and appoints LESLIE H.
EVERETT, LINDA Y.H. CHENG, KATHLEEN RUEGER, GARY P. ENCINAS, JULIE C. GAVIN,
DOREEN A. LUDEMANN, GRACE U. SHIN or ANNIE M. TILLERY his attorneys with full
power of substitution to sign and file with the Securities and Exchange
Commission in his capacity as Vice President and Controller of said corporation
the registration statement or statements covering the issue and sale, in one or
more series, of not exceeding $400,000,000 aggregate principal amount or
liquidation value consisting of unsecured subordinated debentures, notes or
other debt, and related guarantees, and any and all amendments thereto, and
hereby ratifies all that said attorneys or any of them may do or cause to be
done by virtue hereof.
IN WITNESS WHEREOF, I have signed these presents as of this 4th day of
August, 1995.
THOMAS C. LONG
___________________________________
THOMAS C. LONG
<PAGE>
EXHIBIT 25-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) _____
---------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
-----------------------------------
Pacific Gas and Electric Company
(Exact name of obligor as specified in its charter)
California 94-0742640
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
77 Beale Street
P.O. Box 770000
San Francisco 94177
(Address of principal executive offices) (Zip Code)
Deferrable Interest Subordinated Debentures
(Title of Debt Securities)
<PAGE>
Item 1. General Information. Furnish the following
--------------------
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
------------------------------
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
-----------------
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 14th day of August, 1995.
The First National Bank of Chicago,
Trustee,
By /s/ John R. Prendiville
John R. Prendiville
Vice President
*Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 12 of the Form T-1 of The First National
Bank of Chicago, filed as Exhibit 26 to the Registration Statement on Form
S-3 of The CIT Group Holdings, Inc. filed with the Securities and Exchange
Commission on February 16, 1993 (Registration No. 33-58418).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
August 14, 1995
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Pacific Gas and
Electric Company and The First National Bank of Chicago, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ John R. Prendiville
John R. Prendiville
Vice President
4
<PAGE>
EXHIBIT 7
A copy of the latest report of conditions of the trustee published
pursuant to law or the requirements of its supervising or examining
authority.
5
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-1
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1995
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
(Less
than
C400 minus)
Dollar Amounts in ------- -----
Thousands RCFD BIL MIL THOU
----------------- ---- ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1)....... 0081 2,948,128 1.a.
b. Interest-bearing balances(2)................................ 0071 8,482,108 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)... 1754 167,911 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D) 1773 540,011 2.b.
3. Federal funds sold and securities purchased under agreements to
resell in domestic offices of the bank and its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal Funds sold.......................................... 0276 2,508,883 3.a.
b. Securities purchased under agreements to resell............. 0277 1,422,695 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C).......................................................... RCFD 2122 16,238,310 4.a.
b. LESS: Allowance for loan and lease losses................... RCFD 3123 358,207 4.b.
c. LESS: Allocated transfer risk reserve....................... RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)........................... 2125 15,880,103 4.d.
5. Assets held in trading accounts................................ 3545 13,257,798 5.
6. Premises and fixed assets (including capitalized leases)....... 2145 516,827 6.
7. Other real estate owned (from Schedule RC-M)................... 2150 13,166 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)................................. 2130 10,363 8.
9. Customers' liability to this bank on acceptances outstanding... 2155 463,961 9.
10. Intangible assets (from Schedule RC-M)......................... 2143 119,715 10.
11. Other assets (from Schedule RC-F).............................. 2160 1,346,941 11.
12. Total assets (sum of items 1 through 11)....................... 2170 47,678,610 12.
</TABLE>
------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
6
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-2
Schedule RC-Continued
<TABLE>
<CAPTION>
Dollar Amounts in
Thousands Bil Mil Thou
----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................................ RCON 2200 14,675,401 13.a.
(1) Noninterest-bearing(1)................................. RCON 6631 5,498,690 13.a.(1)
(2) Interest-bearing....................................... RCON 6636 9,176,711 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)......................... RCFN 2200 11,809,645 13.b.
(1) Noninterest bearing.................................... RCFN 6631 304,669 13.b.(1)
(2) Interest-bearing....................................... RCFN 6636 11,504,976 13.b.(2)
14. Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of
its Edge and Agreement subsidiaries, and in IBFs:
a. Federal funds purchased.................................... RCFD 0278 2,072,830 14.a.
b. Securities sold under agreements to repurchase............. RCFD 0279 1,484,164 14.b.
15. a. Demand notes issued to the U.S. Treasury................... RCON 2840 103,138 15.a.
b. Trading Liabilities........................................ RCFD 3548 9,101,186 15.b.
16. Other borrowed money:
a. With original maturity of one year or less................. RCFD 2332 2,307,860 16.a.
b. With original maturity of more than one year............... RCFD 2333 506,476 16.b.
17. Mortgage indebtedness and obligations under capitalized
leases........................................................ RCFD 2910 278,108 17.
18. Bank's liability on acceptance executed and outstanding....... RCFD 2920 463,961 18.
19. Subordinated notes and debentures............................. RCFD 3200 1,225,000 19.
20. Other liabilities (from Schedule RC-G)........................ RCFD 2930 699,375 20.
21. Total liabilities (sum of items 13 through 20)................ RCFD 2948 44,727,144 21.
22. Limited-Life preferred stock and related surplus.............. RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................. RCFD 3838 0 23.
24. Common stock.................................................. RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)...... RCFD 3839 2,304,657 25.
26. a. Undivided profits and capital reserves..................... RCFD 3632 447,916 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities................................................. RCFD 8434 ( 2,165) 26.b.
27. Cumulative foreign currency translation adjustments........... RCFD 3284 200 27.
28. Total equity capital (sum of items 23 through 27)............. RCFD 3210 2,951,466 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)......................... RCFD 3300 47,678,610 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the
statement below that best describes the most
comprehensive level of auditing work performed for
the bank by independent external Number
----------------
auditors as of any date during 1993.............. RCFD 6724 N/A M.1.
----------------
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors (may
be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
-------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
7
<PAGE>
EXHIBIT 25-2
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) _____
---------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
-----------------------------------
PG&E Capital I
(Exact name of obligor as specified in its charter)
California 94-0742640
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
77 Beale Street
P.O. Box 770000
San Francisco 94177
(Address of principal executive offices) (Zip Code)
Cumulative Quarterly Income Preferred
(Title of Debt Securities)
<PAGE>
Item 1. General Information. Furnish the following
--------------------
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
------------------------------
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
-----------------
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 14th day of August, 1995.
The First National Bank of Chicago,
Trustee,
By /s/ John R. Prendiville
John R. Prendiville
Vice President
*Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 12 of the Form T-1 of The First National
Bank of Chicago, filed as Exhibit 26 to the Registration Statement on Form
S-3 of The CIT Group Holdings, Inc. filed with the Securities and Exchange
Commission on February 16, 1993 (Registration No. 33-58418).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
August 14, 1995
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Pacific Gas and
Electric Company and The First National Bank of Chicago, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ John R. Prendiville
John R. Prendiville
Vice President
4
<PAGE>
EXHIBIT 7
A copy of the latest report of conditions of the trustee published
pursuant to law or the requirements of its supervising or examining
authority.
5
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-1
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1995
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
(Less
than
C400 minus)
Dollar Amounts in ------- -----
Thousands RCFD BIL MIL THOU
----------------- ---- ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1)....... 0081 2,948,128 1.a.
b. Interest-bearing balances(2)................................ 0071 8,482,108 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)... 1754 167,911 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D) 1773 540,011 2.b.
3. Federal funds sold and securities purchased under agreements to
resell in domestic offices of the bank and its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal Funds sold.......................................... 0276 2,508,883 3.a.
b. Securities purchased under agreements to resell............. 0277 1,422,695 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C).......................................................... RCFD 2122 16,238,310 4.a.
b. LESS: Allowance for loan and lease losses................... RCFD 3123 358,207 4.b.
c. LESS: Allocated transfer risk reserve....................... RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)........................... 2125 15,880,103 4.d.
5. Assets held in trading accounts................................ 3545 13,257,798 5.
6. Premises and fixed assets (including capitalized leases)....... 2145 516,827 6.
7. Other real estate owned (from Schedule RC-M)................... 2150 13,166 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)................................. 2130 10,363 8.
9. Customers' liability to this bank on acceptances outstanding... 2155 463,961 9.
10. Intangible assets (from Schedule RC-M)......................... 2143 119,715 10.
11. Other assets (from Schedule RC-F).............................. 2160 1,346,941 11.
12. Total assets (sum of items 1 through 11)....................... 2170 47,678,610 12.
</TABLE>
------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
6
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-2
Schedule RC-Continued
<TABLE>
<CAPTION>
Dollar Amounts in
Thousands Bil Mil Thou
----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................................ RCON 2200 14,675,401 13.a.
(1) Noninterest-bearing(1)................................. RCON 6631 5,498,690 13.a.(1)
(2) Interest-bearing....................................... RCON 6636 9,176,711 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)......................... RCFN 2200 11,809,645 13.b.
(1) Noninterest bearing.................................... RCFN 6631 304,669 13.b.(1)
(2) Interest-bearing....................................... RCFN 6636 11,504,976 13.b.(2)
14. Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of
its Edge and Agreement subsidiaries, and in IBFs:
a. Federal funds purchased.................................... RCFD 0278 2,072,830 14.a.
b. Securities sold under agreements to repurchase............. RCFD 0279 1,484,164 14.b.
15. a. Demand notes issued to the U.S. Treasury................... RCON 2840 103,138 15.a.
b. Trading Liabilities........................................ RCFD 3548 9,101,186 15.b.
16. Other borrowed money:
a. With original maturity of one year or less................. RCFD 2332 2,307,860 16.a.
b. With original maturity of more than one year............... RCFD 2333 506,476 16.b.
17. Mortgage indebtedness and obligations under capitalized
leases........................................................ RCFD 2910 278,108 17.
18. Bank's liability on acceptance executed and outstanding....... RCFD 2920 463,961 18.
19. Subordinated notes and debentures............................. RCFD 3200 1,225,000 19.
20. Other liabilities (from Schedule RC-G)........................ RCFD 2930 699,375 20.
21. Total liabilities (sum of items 13 through 20)................ RCFD 2948 44,727,144 21.
22. Limited-Life preferred stock and related surplus.............. RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................. RCFD 3838 0 23.
24. Common stock.................................................. RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)...... RCFD 3839 2,304,657 25.
26. a. Undivided profits and capital reserves..................... RCFD 3632 447,916 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities................................................. RCFD 8434 ( 2,165) 26.b.
27. Cumulative foreign currency translation adjustments........... RCFD 3284 200 27.
28. Total equity capital (sum of items 23 through 27)............. RCFD 3210 2,951,466 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)......................... RCFD 3300 47,678,610 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the
statement below that best describes the most
comprehensive level of auditing work performed for
the bank by independent external Number
----------------
auditors as of any date during 1993.............. RCFD 6724 N/A M.1.
----------------
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors (may
be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
-------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
7
<PAGE>
EXHIBIT 25-3
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) _____
---------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
-----------------------------------
PG&E Capital II
(Exact name of obligor as specified in its charter)
California 94-0742640
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
77 Beale Street
P.O. Box 770000
San Francisco 94177
(Address of principal executive offices) (Zip Code)
Cumulative Quarterly Income Preferred
(Title of Debt Securities)
<PAGE>
Item 1. General Information. Furnish the following
--------------------
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
------------------------------
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
-----------------
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 14th day of August, 1995.
The First National Bank of Chicago,
Trustee,
By /s/ John R. Prendiville
John R. Prendiville
Vice President
*Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 12 of the Form T-1 of The First National
Bank of Chicago, filed as Exhibit 26 to the Registration Statement on Form
S-3 of The CIT Group Holdings, Inc. filed with the Securities and Exchange
Commission on February 16, 1993 (Registration No. 33-58418).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
August 14, 1995
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Pacific Gas and
Electric Company and The First National Bank of Chicago, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ John R. Prendiville
John R. Prendiville
Vice President
4
<PAGE>
EXHIBIT 7
A copy of the latest report of conditions of the trustee published
pursuant to law or the requirements of its supervising or examining
authority.
5
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-1
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1995
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
(Less
than
C400 minus)
Dollar Amounts in ------- -----
Thousands RCFD BIL MIL THOU
----------------- ---- ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1)....... 0081 2,948,128 1.a.
b. Interest-bearing balances(2)................................ 0071 8,482,108 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)... 1754 167,911 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D) 1773 540,011 2.b.
3. Federal funds sold and securities purchased under agreements to
resell in domestic offices of the bank and its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal Funds sold.......................................... 0276 2,508,883 3.a.
b. Securities purchased under agreements to resell............. 0277 1,422,695 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C).......................................................... RCFD 2122 16,238,310 4.a.
b. LESS: Allowance for loan and lease losses................... RCFD 3123 358,207 4.b.
c. LESS: Allocated transfer risk reserve....................... RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)........................... 2125 15,880,103 4.d.
5. Assets held in trading accounts................................ 3545 13,257,798 5.
6. Premises and fixed assets (including capitalized leases)....... 2145 516,827 6.
7. Other real estate owned (from Schedule RC-M)................... 2150 13,166 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)................................. 2130 10,363 8.
9. Customers' liability to this bank on acceptances outstanding... 2155 463,961 9.
10. Intangible assets (from Schedule RC-M)......................... 2143 119,715 10.
11. Other assets (from Schedule RC-F).............................. 2160 1,346,941 11.
12. Total assets (sum of items 1 through 11)....................... 2170 47,678,610 12.
</TABLE>
------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
6
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-2
Schedule RC-Continued
<TABLE>
<CAPTION>
Dollar Amounts in
Thousands Bil Mil Thou
----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................................ RCON 2200 14,675,401 13.a.
(1) Noninterest-bearing(1)................................. RCON 6631 5,498,690 13.a.(1)
(2) Interest-bearing....................................... RCON 6636 9,176,711 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)......................... RCFN 2200 11,809,645 13.b.
(1) Noninterest bearing.................................... RCFN 6631 304,669 13.b.(1)
(2) Interest-bearing....................................... RCFN 6636 11,504,976 13.b.(2)
14. Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of
its Edge and Agreement subsidiaries, and in IBFs:
a. Federal funds purchased.................................... RCFD 0278 2,072,830 14.a.
b. Securities sold under agreements to repurchase............. RCFD 0279 1,484,164 14.b.
15. a. Demand notes issued to the U.S. Treasury................... RCON 2840 103,138 15.a.
b. Trading Liabilities........................................ RCFD 3548 9,101,186 15.b.
16. Other borrowed money:
a. With original maturity of one year or less................. RCFD 2332 2,307,860 16.a.
b. With original maturity of more than one year............... RCFD 2333 506,476 16.b.
17. Mortgage indebtedness and obligations under capitalized
leases........................................................ RCFD 2910 278,108 17.
18. Bank's liability on acceptance executed and outstanding....... RCFD 2920 463,961 18.
19. Subordinated notes and debentures............................. RCFD 3200 1,225,000 19.
20. Other liabilities (from Schedule RC-G)........................ RCFD 2930 699,375 20.
21. Total liabilities (sum of items 13 through 20)................ RCFD 2948 44,727,144 21.
22. Limited-Life preferred stock and related surplus.............. RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................. RCFD 3838 0 23.
24. Common stock.................................................. RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)...... RCFD 3839 2,304,657 25.
26. a. Undivided profits and capital reserves..................... RCFD 3632 447,916 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities................................................. RCFD 8434 ( 2,165) 26.b.
27. Cumulative foreign currency translation adjustments........... RCFD 3284 200 27.
28. Total equity capital (sum of items 23 through 27)............. RCFD 3210 2,951,466 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)......................... RCFD 3300 47,678,610 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the
statement below that best describes the most
comprehensive level of auditing work performed for
the bank by independent external Number
----------------
auditors as of any date during 1993.............. RCFD 6724 N/A M.1.
----------------
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors (may
be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
-------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
7
<PAGE>
EXHIBIT 25-4
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) _____
---------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
-----------------------------------
PG&E Capital III
(Exact name of obligor as specified in its charter)
California 94-0742640
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
77 Beale Street
P.O. Box 770000
San Francisco 94177
(Address of principal executive offices) (Zip Code)
Cumulative Quarterly Income Preferred
(Title of Debt Securities)
<PAGE>
Item 1. General Information. Furnish the following
--------------------
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
------------------------------
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
-----------------
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 14th day of August, 1995.
The First National Bank of Chicago,
Trustee,
By /s/ John R. Prendiville
John R. Prendiville
Vice President
*Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 12 of the Form T-1 of The First National
Bank of Chicago, filed as Exhibit 26 to the Registration Statement on Form
S-3 of The CIT Group Holdings, Inc. filed with the Securities and Exchange
Commission on February 16, 1993 (Registration No. 33-58418).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
August 14, 1995
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Pacific Gas and
Electric Company and The First National Bank of Chicago, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ John R. Prendiville
John R. Prendiville
Vice President
4
<PAGE>
EXHIBIT 7
A copy of the latest report of conditions of the trustee published
pursuant to law or the requirements of its supervising or examining
authority.
5
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-1
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1995
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
(Less
than
C400 minus)
Dollar Amounts in ------- -----
Thousands RCFD BIL MIL THOU
----------------- ---- ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1)....... 0081 2,948,128 1.a.
b. Interest-bearing balances(2)................................ 0071 8,482,108 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)... 1754 167,911 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D) 1773 540,011 2.b.
3. Federal funds sold and securities purchased under agreements to
resell in domestic offices of the bank and its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal Funds sold.......................................... 0276 2,508,883 3.a.
b. Securities purchased under agreements to resell............. 0277 1,422,695 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C).......................................................... RCFD 2122 16,238,310 4.a.
b. LESS: Allowance for loan and lease losses................... RCFD 3123 358,207 4.b.
c. LESS: Allocated transfer risk reserve....................... RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)........................... 2125 15,880,103 4.d.
5. Assets held in trading accounts................................ 3545 13,257,798 5.
6. Premises and fixed assets (including capitalized leases)....... 2145 516,827 6.
7. Other real estate owned (from Schedule RC-M)................... 2150 13,166 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)................................. 2130 10,363 8.
9. Customers' liability to this bank on acceptances outstanding... 2155 463,961 9.
10. Intangible assets (from Schedule RC-M)......................... 2143 119,715 10.
11. Other assets (from Schedule RC-F).............................. 2160 1,346,941 11.
12. Total assets (sum of items 1 through 11)....................... 2170 47,678,610 12.
</TABLE>
------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
6
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-2
Schedule RC-Continued
<TABLE>
<CAPTION>
Dollar Amounts in
Thousands Bil Mil Thou
----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................................ RCON 2200 14,675,401 13.a.
(1) Noninterest-bearing(1)................................. RCON 6631 5,498,690 13.a.(1)
(2) Interest-bearing....................................... RCON 6636 9,176,711 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)......................... RCFN 2200 11,809,645 13.b.
(1) Noninterest bearing.................................... RCFN 6631 304,669 13.b.(1)
(2) Interest-bearing....................................... RCFN 6636 11,504,976 13.b.(2)
14. Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of
its Edge and Agreement subsidiaries, and in IBFs:
a. Federal funds purchased.................................... RCFD 0278 2,072,830 14.a.
b. Securities sold under agreements to repurchase............. RCFD 0279 1,484,164 14.b.
15. a. Demand notes issued to the U.S. Treasury................... RCON 2840 103,138 15.a.
b. Trading Liabilities........................................ RCFD 3548 9,101,186 15.b.
16. Other borrowed money:
a. With original maturity of one year or less................. RCFD 2332 2,307,860 16.a.
b. With original maturity of more than one year............... RCFD 2333 506,476 16.b.
17. Mortgage indebtedness and obligations under capitalized
leases........................................................ RCFD 2910 278,108 17.
18. Bank's liability on acceptance executed and outstanding....... RCFD 2920 463,961 18.
19. Subordinated notes and debentures............................. RCFD 3200 1,225,000 19.
20. Other liabilities (from Schedule RC-G)........................ RCFD 2930 699,375 20.
21. Total liabilities (sum of items 13 through 20)................ RCFD 2948 44,727,144 21.
22. Limited-Life preferred stock and related surplus.............. RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................. RCFD 3838 0 23.
24. Common stock.................................................. RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)...... RCFD 3839 2,304,657 25.
26. a. Undivided profits and capital reserves..................... RCFD 3632 447,916 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities................................................. RCFD 8434 ( 2,165) 26.b.
27. Cumulative foreign currency translation adjustments........... RCFD 3284 200 27.
28. Total equity capital (sum of items 23 through 27)............. RCFD 3210 2,951,466 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)......................... RCFD 3300 47,678,610 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the
statement below that best describes the most
comprehensive level of auditing work performed for
the bank by independent external Number
----------------
auditors as of any date during 1993.............. RCFD 6724 N/A M.1.
----------------
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors (may
be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
-------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
7
<PAGE>
EXHIBIT 25-5
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) _____
---------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
-----------------------------------
PG&E Capital IV
(Exact name of obligor as specified in its charter)
California 94-0742640
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
77 Beale Street
P.O. Box 770000
San Francisco 94177
(Address of principal executive offices) (Zip Code)
Cumulative Quarterly Income Preferred
(Title of Debt Securities)
<PAGE>
Item 1. General Information. Furnish the following
--------------------
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
------------------------------
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
-----------------
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 14th day of August, 1995.
The First National Bank of Chicago,
Trustee,
By /s/ John R. Prendiville
John R. Prendiville
Vice President
*Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 12 of the Form T-1 of The First National
Bank of Chicago, filed as Exhibit 26 to the Registration Statement on Form
S-3 of The CIT Group Holdings, Inc. filed with the Securities and Exchange
Commission on February 16, 1993 (Registration No. 33-58418).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
August 14, 1995
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Pacific Gas and
Electric Company and The First National Bank of Chicago, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ John R. Prendiville
John R. Prendiville
Vice President
4
<PAGE>
EXHIBIT 7
A copy of the latest report of conditions of the trustee published
pursuant to law or the requirements of its supervising or examining
authority.
5
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-1
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1995
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
(Less
than
C400 minus)
Dollar Amounts in ------- -----
Thousands RCFD BIL MIL THOU
----------------- ---- ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1)....... 0081 2,948,128 1.a.
b. Interest-bearing balances(2)................................ 0071 8,482,108 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)... 1754 167,911 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D) 1773 540,011 2.b.
3. Federal funds sold and securities purchased under agreements to
resell in domestic offices of the bank and its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal Funds sold.......................................... 0276 2,508,883 3.a.
b. Securities purchased under agreements to resell............. 0277 1,422,695 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C).......................................................... RCFD 2122 16,238,310 4.a.
b. LESS: Allowance for loan and lease losses................... RCFD 3123 358,207 4.b.
c. LESS: Allocated transfer risk reserve....................... RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)........................... 2125 15,880,103 4.d.
5. Assets held in trading accounts................................ 3545 13,257,798 5.
6. Premises and fixed assets (including capitalized leases)....... 2145 516,827 6.
7. Other real estate owned (from Schedule RC-M)................... 2150 13,166 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)................................. 2130 10,363 8.
9. Customers' liability to this bank on acceptances outstanding... 2155 463,961 9.
10. Intangible assets (from Schedule RC-M)......................... 2143 119,715 10.
11. Other assets (from Schedule RC-F).............................. 2160 1,346,941 11.
12. Total assets (sum of items 1 through 11)....................... 2170 47,678,610 12.
</TABLE>
------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
6
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-2
Schedule RC-Continued
<TABLE>
<CAPTION>
Dollar Amounts in
Thousands Bil Mil Thou
----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................................ RCON 2200 14,675,401 13.a.
(1) Noninterest-bearing(1)................................. RCON 6631 5,498,690 13.a.(1)
(2) Interest-bearing....................................... RCON 6636 9,176,711 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)......................... RCFN 2200 11,809,645 13.b.
(1) Noninterest bearing.................................... RCFN 6631 304,669 13.b.(1)
(2) Interest-bearing....................................... RCFN 6636 11,504,976 13.b.(2)
14. Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of
its Edge and Agreement subsidiaries, and in IBFs:
a. Federal funds purchased.................................... RCFD 0278 2,072,830 14.a.
b. Securities sold under agreements to repurchase............. RCFD 0279 1,484,164 14.b.
15. a. Demand notes issued to the U.S. Treasury................... RCON 2840 103,138 15.a.
b. Trading Liabilities........................................ RCFD 3548 9,101,186 15.b.
16. Other borrowed money:
a. With original maturity of one year or less................. RCFD 2332 2,307,860 16.a.
b. With original maturity of more than one year............... RCFD 2333 506,476 16.b.
17. Mortgage indebtedness and obligations under capitalized
leases........................................................ RCFD 2910 278,108 17.
18. Bank's liability on acceptance executed and outstanding....... RCFD 2920 463,961 18.
19. Subordinated notes and debentures............................. RCFD 3200 1,225,000 19.
20. Other liabilities (from Schedule RC-G)........................ RCFD 2930 699,375 20.
21. Total liabilities (sum of items 13 through 20)................ RCFD 2948 44,727,144 21.
22. Limited-Life preferred stock and related surplus.............. RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................. RCFD 3838 0 23.
24. Common stock.................................................. RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)...... RCFD 3839 2,304,657 25.
26. a. Undivided profits and capital reserves..................... RCFD 3632 447,916 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities................................................. RCFD 8434 ( 2,165) 26.b.
27. Cumulative foreign currency translation adjustments........... RCFD 3284 200 27.
28. Total equity capital (sum of items 23 through 27)............. RCFD 3210 2,951,466 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)......................... RCFD 3300 47,678,610 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the
statement below that best describes the most
comprehensive level of auditing work performed for
the bank by independent external Number
----------------
auditors as of any date during 1993.............. RCFD 6724 N/A M.1.
----------------
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors (may
be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
-------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
7
<PAGE>
EXHIBIT 25-6
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) _____
---------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
-----------------------------------
Pacific Gas and Electric Company
(Exact name of obligor as specified in its charter)
California 94-0742640
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
77 Beale Street
P.O. Box 770000
San Francisco 94177
(Address of principal executive offices) (Zip Code)
GUARANTEE AGREEMENTS WITH RESPECT TO PREFERRED SECURITIES OF PG&E CAPITAL I
(Title of Debt Securities)
<PAGE>
Item 1. General Information. Furnish the following
--------------------
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
------------------------------
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
-----------------
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 14th day of August, 1995.
The First National Bank of Chicago,
Trustee,
By /s/ John R. Prendiville
John R. Prendiville
Vice President
*Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 12 of the Form T-1 of The First National
Bank of Chicago, filed as Exhibit 26 to the Registration Statement on Form
S-3 of The CIT Group Holdings, Inc. filed with the Securities and Exchange
Commission on February 16, 1993 (Registration No. 33-58418).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
August 14, 1995
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Pacific Gas and
Electric Company and The First National Bank of Chicago, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ John R. Prendiville
John R. Prendiville
Vice President
4
<PAGE>
EXHIBIT 7
A copy of the latest report of conditions of the trustee published
pursuant to law or the requirements of its supervising or examining
authority.
5
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-1
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1995
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
(Less
than
C400 minus)
Dollar Amounts in ------- -----
Thousands RCFD BIL MIL THOU
----------------- ---- ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1)....... 0081 2,948,128 1.a.
b. Interest-bearing balances(2)................................ 0071 8,482,108 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)... 1754 167,911 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D) 1773 540,011 2.b.
3. Federal funds sold and securities purchased under agreements to
resell in domestic offices of the bank and its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal Funds sold.......................................... 0276 2,508,883 3.a.
b. Securities purchased under agreements to resell............. 0277 1,422,695 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C).......................................................... RCFD 2122 16,238,310 4.a.
b. LESS: Allowance for loan and lease losses................... RCFD 3123 358,207 4.b.
c. LESS: Allocated transfer risk reserve....................... RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)........................... 2125 15,880,103 4.d.
5. Assets held in trading accounts................................ 3545 13,257,798 5.
6. Premises and fixed assets (including capitalized leases)....... 2145 516,827 6.
7. Other real estate owned (from Schedule RC-M)................... 2150 13,166 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)................................. 2130 10,363 8.
9. Customers' liability to this bank on acceptances outstanding... 2155 463,961 9.
10. Intangible assets (from Schedule RC-M)......................... 2143 119,715 10.
11. Other assets (from Schedule RC-F).............................. 2160 1,346,941 11.
12. Total assets (sum of items 1 through 11)....................... 2170 47,678,610 12.
</TABLE>
------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
6
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-2
Schedule RC-Continued
<TABLE>
<CAPTION>
Dollar Amounts in
Thousands Bil Mil Thou
----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................................ RCON 2200 14,675,401 13.a.
(1) Noninterest-bearing(1)................................. RCON 6631 5,498,690 13.a.(1)
(2) Interest-bearing....................................... RCON 6636 9,176,711 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)......................... RCFN 2200 11,809,645 13.b.
(1) Noninterest bearing.................................... RCFN 6631 304,669 13.b.(1)
(2) Interest-bearing....................................... RCFN 6636 11,504,976 13.b.(2)
14. Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of
its Edge and Agreement subsidiaries, and in IBFs:
a. Federal funds purchased.................................... RCFD 0278 2,072,830 14.a.
b. Securities sold under agreements to repurchase............. RCFD 0279 1,484,164 14.b.
15. a. Demand notes issued to the U.S. Treasury................... RCON 2840 103,138 15.a.
b. Trading Liabilities........................................ RCFD 3548 9,101,186 15.b.
16. Other borrowed money:
a. With original maturity of one year or less................. RCFD 2332 2,307,860 16.a.
b. With original maturity of more than one year............... RCFD 2333 506,476 16.b.
17. Mortgage indebtedness and obligations under capitalized
leases........................................................ RCFD 2910 278,108 17.
18. Bank's liability on acceptance executed and outstanding....... RCFD 2920 463,961 18.
19. Subordinated notes and debentures............................. RCFD 3200 1,225,000 19.
20. Other liabilities (from Schedule RC-G)........................ RCFD 2930 699,375 20.
21. Total liabilities (sum of items 13 through 20)................ RCFD 2948 44,727,144 21.
22. Limited-Life preferred stock and related surplus.............. RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................. RCFD 3838 0 23.
24. Common stock.................................................. RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)...... RCFD 3839 2,304,657 25.
26. a. Undivided profits and capital reserves..................... RCFD 3632 447,916 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities................................................. RCFD 8434 ( 2,165) 26.b.
27. Cumulative foreign currency translation adjustments........... RCFD 3284 200 27.
28. Total equity capital (sum of items 23 through 27)............. RCFD 3210 2,951,466 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)......................... RCFD 3300 47,678,610 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the
statement below that best describes the most
comprehensive level of auditing work performed for
the bank by independent external Number
----------------
auditors as of any date during 1993.............. RCFD 6724 N/A M.1.
----------------
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors (may
be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
-------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
7
<PAGE>
EXHIBIT 25-7
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) _____
---------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
-----------------------------------
Pacific Gas and Electric Company
(Exact name of obligor as specified in its charter)
California 94-0742640
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
77 Beale Street
P.O. Box 770000
San Francisco 94177
(Address of principal executive offices) (Zip Code)
GUARANTEE AGREEMENTS WITH RESPECT TO PREFERRED SECURITIES OF PG&E CAPITAL II
(Title of Debt Securities)
<PAGE>
Item 1. General Information. Furnish the following
--------------------
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
------------------------------
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
-----------------
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 14th day of August, 1995.
The First National Bank of Chicago,
Trustee,
By /s/ John R. Prendiville
John R. Prendiville
Vice President
*Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 12 of the Form T-1 of The First National
Bank of Chicago, filed as Exhibit 26 to the Registration Statement on Form
S-3 of The CIT Group Holdings, Inc. filed with the Securities and Exchange
Commission on February 16, 1993 (Registration No. 33-58418).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
August 14, 1995
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Pacific Gas and
Electric Company and The First National Bank of Chicago, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ John R. Prendiville
John R. Prendiville
Vice President
4
<PAGE>
EXHIBIT 7
A copy of the latest report of conditions of the trustee published
pursuant to law or the requirements of its supervising or examining
authority.
5
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-1
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1995
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
(Less
than
C400 minus)
Dollar Amounts in ------- -----
Thousands RCFD BIL MIL THOU
----------------- ---- ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1)....... 0081 2,948,128 1.a.
b. Interest-bearing balances(2)................................ 0071 8,482,108 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)... 1754 167,911 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D) 1773 540,011 2.b.
3. Federal funds sold and securities purchased under agreements to
resell in domestic offices of the bank and its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal Funds sold.......................................... 0276 2,508,883 3.a.
b. Securities purchased under agreements to resell............. 0277 1,422,695 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C).......................................................... RCFD 2122 16,238,310 4.a.
b. LESS: Allowance for loan and lease losses................... RCFD 3123 358,207 4.b.
c. LESS: Allocated transfer risk reserve....................... RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)........................... 2125 15,880,103 4.d.
5. Assets held in trading accounts................................ 3545 13,257,798 5.
6. Premises and fixed assets (including capitalized leases)....... 2145 516,827 6.
7. Other real estate owned (from Schedule RC-M)................... 2150 13,166 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)................................. 2130 10,363 8.
9. Customers' liability to this bank on acceptances outstanding... 2155 463,961 9.
10. Intangible assets (from Schedule RC-M)......................... 2143 119,715 10.
11. Other assets (from Schedule RC-F).............................. 2160 1,346,941 11.
12. Total assets (sum of items 1 through 11)....................... 2170 47,678,610 12.
</TABLE>
------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
6
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-2
Schedule RC-Continued
<TABLE>
<CAPTION>
Dollar Amounts in
Thousands Bil Mil Thou
----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................................ RCON 2200 14,675,401 13.a.
(1) Noninterest-bearing(1)................................. RCON 6631 5,498,690 13.a.(1)
(2) Interest-bearing....................................... RCON 6636 9,176,711 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)......................... RCFN 2200 11,809,645 13.b.
(1) Noninterest bearing.................................... RCFN 6631 304,669 13.b.(1)
(2) Interest-bearing....................................... RCFN 6636 11,504,976 13.b.(2)
14. Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of
its Edge and Agreement subsidiaries, and in IBFs:
a. Federal funds purchased.................................... RCFD 0278 2,072,830 14.a.
b. Securities sold under agreements to repurchase............. RCFD 0279 1,484,164 14.b.
15. a. Demand notes issued to the U.S. Treasury................... RCON 2840 103,138 15.a.
b. Trading Liabilities........................................ RCFD 3548 9,101,186 15.b.
16. Other borrowed money:
a. With original maturity of one year or less................. RCFD 2332 2,307,860 16.a.
b. With original maturity of more than one year............... RCFD 2333 506,476 16.b.
17. Mortgage indebtedness and obligations under capitalized
leases........................................................ RCFD 2910 278,108 17.
18. Bank's liability on acceptance executed and outstanding....... RCFD 2920 463,961 18.
19. Subordinated notes and debentures............................. RCFD 3200 1,225,000 19.
20. Other liabilities (from Schedule RC-G)........................ RCFD 2930 699,375 20.
21. Total liabilities (sum of items 13 through 20)................ RCFD 2948 44,727,144 21.
22. Limited-Life preferred stock and related surplus.............. RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................. RCFD 3838 0 23.
24. Common stock.................................................. RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)...... RCFD 3839 2,304,657 25.
26. a. Undivided profits and capital reserves..................... RCFD 3632 447,916 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities................................................. RCFD 8434 ( 2,165) 26.b.
27. Cumulative foreign currency translation adjustments........... RCFD 3284 200 27.
28. Total equity capital (sum of items 23 through 27)............. RCFD 3210 2,951,466 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)......................... RCFD 3300 47,678,610 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the
statement below that best describes the most
comprehensive level of auditing work performed for
the bank by independent external Number
----------------
auditors as of any date during 1993.............. RCFD 6724 N/A M.1.
----------------
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors (may
be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
-------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
7
<PAGE>
EXHIBIT 25-8
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) _____
---------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
-----------------------------------
Pacific Gas and Electric Company
(Exact name of obligor as specified in its charter)
California 94-0742640
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
77 Beale Street
P.O. Box 770000
San Francisco 94177
(Address of principal executive offices) (Zip Code)
GUARANTEE AGREEMENTS WITH RESPECT TO PREFERRED SECURITIES OF PG&E CAPITAL III
(Title of Debt Securities)
<PAGE>
Item 1. General Information. Furnish the following
--------------------
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
------------------------------
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
-----------------
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 14th day of August, 1995.
The First National Bank of Chicago,
Trustee,
By /s/ John R. Prendiville
John R. Prendiville
Vice President
*Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 12 of the Form T-1 of The First National
Bank of Chicago, filed as Exhibit 26 to the Registration Statement on Form
S-3 of The CIT Group Holdings, Inc. filed with the Securities and Exchange
Commission on February 16, 1993 (Registration No. 33-58418).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
August 14, 1995
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Pacific Gas and
Electric Company and The First National Bank of Chicago, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ John R. Prendiville
John R. Prendiville
Vice President
4
<PAGE>
EXHIBIT 7
A copy of the latest report of conditions of the trustee published
pursuant to law or the requirements of its supervising or examining
authority.
5
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-1
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1995
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
(Less
than
C400 minus)
Dollar Amounts in ------- -----
Thousands RCFD BIL MIL THOU
----------------- ---- ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1)....... 0081 2,948,128 1.a.
b. Interest-bearing balances(2)................................ 0071 8,482,108 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)... 1754 167,911 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D) 1773 540,011 2.b.
3. Federal funds sold and securities purchased under agreements to
resell in domestic offices of the bank and its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal Funds sold.......................................... 0276 2,508,883 3.a.
b. Securities purchased under agreements to resell............. 0277 1,422,695 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C).......................................................... RCFD 2122 16,238,310 4.a.
b. LESS: Allowance for loan and lease losses................... RCFD 3123 358,207 4.b.
c. LESS: Allocated transfer risk reserve....................... RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)........................... 2125 15,880,103 4.d.
5. Assets held in trading accounts................................ 3545 13,257,798 5.
6. Premises and fixed assets (including capitalized leases)....... 2145 516,827 6.
7. Other real estate owned (from Schedule RC-M)................... 2150 13,166 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)................................. 2130 10,363 8.
9. Customers' liability to this bank on acceptances outstanding... 2155 463,961 9.
10. Intangible assets (from Schedule RC-M)......................... 2143 119,715 10.
11. Other assets (from Schedule RC-F).............................. 2160 1,346,941 11.
12. Total assets (sum of items 1 through 11)....................... 2170 47,678,610 12.
</TABLE>
------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
6
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-2
Schedule RC-Continued
<TABLE>
<CAPTION>
Dollar Amounts in
Thousands Bil Mil Thou
----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................................ RCON 2200 14,675,401 13.a.
(1) Noninterest-bearing(1)................................. RCON 6631 5,498,690 13.a.(1)
(2) Interest-bearing....................................... RCON 6636 9,176,711 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)......................... RCFN 2200 11,809,645 13.b.
(1) Noninterest bearing.................................... RCFN 6631 304,669 13.b.(1)
(2) Interest-bearing....................................... RCFN 6636 11,504,976 13.b.(2)
14. Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of
its Edge and Agreement subsidiaries, and in IBFs:
a. Federal funds purchased.................................... RCFD 0278 2,072,830 14.a.
b. Securities sold under agreements to repurchase............. RCFD 0279 1,484,164 14.b.
15. a. Demand notes issued to the U.S. Treasury................... RCON 2840 103,138 15.a.
b. Trading Liabilities........................................ RCFD 3548 9,101,186 15.b.
16. Other borrowed money:
a. With original maturity of one year or less................. RCFD 2332 2,307,860 16.a.
b. With original maturity of more than one year............... RCFD 2333 506,476 16.b.
17. Mortgage indebtedness and obligations under capitalized
leases........................................................ RCFD 2910 278,108 17.
18. Bank's liability on acceptance executed and outstanding....... RCFD 2920 463,961 18.
19. Subordinated notes and debentures............................. RCFD 3200 1,225,000 19.
20. Other liabilities (from Schedule RC-G)........................ RCFD 2930 699,375 20.
21. Total liabilities (sum of items 13 through 20)................ RCFD 2948 44,727,144 21.
22. Limited-Life preferred stock and related surplus.............. RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................. RCFD 3838 0 23.
24. Common stock.................................................. RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)...... RCFD 3839 2,304,657 25.
26. a. Undivided profits and capital reserves..................... RCFD 3632 447,916 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities................................................. RCFD 8434 ( 2,165) 26.b.
27. Cumulative foreign currency translation adjustments........... RCFD 3284 200 27.
28. Total equity capital (sum of items 23 through 27)............. RCFD 3210 2,951,466 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)......................... RCFD 3300 47,678,610 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the
statement below that best describes the most
comprehensive level of auditing work performed for
the bank by independent external Number
----------------
auditors as of any date during 1993.............. RCFD 6724 N/A M.1.
----------------
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors (may
be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
-------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
7
<PAGE>
EXHIBIT 25-9
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) _____
---------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
-----------------------------------
Pacific Gas and Electric Company
(Exact name of obligor as specified in its charter)
California 94-0742640
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
77 Beale Street
P.O. Box 770000
San Francisco 94177
(Address of principal executive offices) (Zip Code)
GUARANTEE AGREEMENTS WITH RESPECT TO PREFERRED SECURITIES OF PG&E CAPITAL IV
(Title of Debt Securities)
<PAGE>
Item 1. General Information. Furnish the following
--------------------
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
------------------------------
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
-----------------
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 14th day of August, 1995.
The First National Bank of Chicago,
Trustee,
By /s/ John R. Prendiville
John R. Prendiville
Vice President
*Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 12 of the Form T-1 of The First National
Bank of Chicago, filed as Exhibit 26 to the Registration Statement on Form
S-3 of The CIT Group Holdings, Inc. filed with the Securities and Exchange
Commission on February 16, 1993 (Registration No. 33-58418).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
August 14, 1995
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Pacific Gas and
Electric Company and The First National Bank of Chicago, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ John R. Prendiville
John R. Prendiville
Vice President
4
<PAGE>
EXHIBIT 7
A copy of the latest report of conditions of the trustee published
pursuant to law or the requirements of its supervising or examining
authority.
5
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-1
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1995
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
(Less
than
C400 minus)
Dollar Amounts in ------- -----
Thousands RCFD BIL MIL THOU
----------------- ---- ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1)....... 0081 2,948,128 1.a.
b. Interest-bearing balances(2)................................ 0071 8,482,108 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)... 1754 167,911 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D) 1773 540,011 2.b.
3. Federal funds sold and securities purchased under agreements to
resell in domestic offices of the bank and its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal Funds sold.......................................... 0276 2,508,883 3.a.
b. Securities purchased under agreements to resell............. 0277 1,422,695 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C).......................................................... RCFD 2122 16,238,310 4.a.
b. LESS: Allowance for loan and lease losses................... RCFD 3123 358,207 4.b.
c. LESS: Allocated transfer risk reserve....................... RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)........................... 2125 15,880,103 4.d.
5. Assets held in trading accounts................................ 3545 13,257,798 5.
6. Premises and fixed assets (including capitalized leases)....... 2145 516,827 6.
7. Other real estate owned (from Schedule RC-M)................... 2150 13,166 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)................................. 2130 10,363 8.
9. Customers' liability to this bank on acceptances outstanding... 2155 463,961 9.
10. Intangible assets (from Schedule RC-M)......................... 2143 119,715 10.
11. Other assets (from Schedule RC-F).............................. 2160 1,346,941 11.
12. Total assets (sum of items 1 through 11)....................... 2170 47,678,610 12.
</TABLE>
------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
6
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
Call Date: 3/31/95 ST-BK: 17-1630 FFIEC 031
Page RC-2
Schedule RC-Continued
<TABLE>
<CAPTION>
Dollar Amounts in
Thousands Bil Mil Thou
----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................................ RCON 2200 14,675,401 13.a.
(1) Noninterest-bearing(1)................................. RCON 6631 5,498,690 13.a.(1)
(2) Interest-bearing....................................... RCON 6636 9,176,711 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)......................... RCFN 2200 11,809,645 13.b.
(1) Noninterest bearing.................................... RCFN 6631 304,669 13.b.(1)
(2) Interest-bearing....................................... RCFN 6636 11,504,976 13.b.(2)
14. Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of
its Edge and Agreement subsidiaries, and in IBFs:
a. Federal funds purchased.................................... RCFD 0278 2,072,830 14.a.
b. Securities sold under agreements to repurchase............. RCFD 0279 1,484,164 14.b.
15. a. Demand notes issued to the U.S. Treasury................... RCON 2840 103,138 15.a.
b. Trading Liabilities........................................ RCFD 3548 9,101,186 15.b.
16. Other borrowed money:
a. With original maturity of one year or less................. RCFD 2332 2,307,860 16.a.
b. With original maturity of more than one year............... RCFD 2333 506,476 16.b.
17. Mortgage indebtedness and obligations under capitalized
leases........................................................ RCFD 2910 278,108 17.
18. Bank's liability on acceptance executed and outstanding....... RCFD 2920 463,961 18.
19. Subordinated notes and debentures............................. RCFD 3200 1,225,000 19.
20. Other liabilities (from Schedule RC-G)........................ RCFD 2930 699,375 20.
21. Total liabilities (sum of items 13 through 20)................ RCFD 2948 44,727,144 21.
22. Limited-Life preferred stock and related surplus.............. RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................. RCFD 3838 0 23.
24. Common stock.................................................. RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)...... RCFD 3839 2,304,657 25.
26. a. Undivided profits and capital reserves..................... RCFD 3632 447,916 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities................................................. RCFD 8434 ( 2,165) 26.b.
27. Cumulative foreign currency translation adjustments........... RCFD 3284 200 27.
28. Total equity capital (sum of items 23 through 27)............. RCFD 3210 2,951,466 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)......................... RCFD 3300 47,678,610 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the
statement below that best describes the most
comprehensive level of auditing work performed for
the bank by independent external Number
----------------
auditors as of any date during 1993.............. RCFD 6724 N/A M.1.
----------------
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors (may
be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
-------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
7
