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As filed with the Securities and Exchange Commission on July 10, 1997
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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UNION TEXAS PETROLEUM HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or organization)
76-0040040
(I.R.S. Employer Identification No.)
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1330 Post Oak Boulevard
Houston, Texas 77056
(713) 623-6544
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
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ALAN R. CRAIN, JR.
GENERAL COUNSEL, VICE PRESIDENT
1330 POST OAK BOULEVARD
HOUSTON, TEXAS 77056
(713) 623-6544
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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Copies to:
MARK ZVONKOVIC JOHN B. TEHAN
CHRISTINE B. LAFOLLETTE SIMPSON THACHER & BARTLETT
KING & SPALDING 425 LEXINGTON AVENUE
1100 LOUISIANA, SUITE 3300 NEW YORK, NEW YORK 10017
HOUSTON, TEXAS 77002 (212) 455-2000
(713) 751-3200
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after this Registration Statement becomes effective as determined by
market conditions.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [x]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
====================================================================================================================================
Proposed Maximum Aggregate
Title of Class of Securities to be Registered Offering Price (1)(2) Amount of Registration Fee
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Debt Securities(3)
Common Stock(3)
Preferred Stock(3) $500,000,000 $151,516 (5)
Depositary Shares representing Preferred Stock(4)
Warrants(3)
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</TABLE>
(1) In no event will the aggregate maximum offering price of all securities
registered under this Registration Statement exceed $500,000,000. Such
amount includes any consideration to be received for Securities issued upon
exercise of the Warrants. Any securities registered hereunder may be sold
separately or as units with other securities registered hereunder.
(2) The proposed maximum offering price per unit (a) has been omitted pursuant
to Instruction II.D. of Form S-3 and (b) will be determined, from time to
time, by the Registrant in connection with the issuance by the Registrant
of the securities registered hereunder.
(3) Subject to footnote (1), there is being registered hereunder an
indeterminate number of shares of Common Stock, Preferred Stock, Depositary
Shares, Warrants and Debt Securities as may be sold, from time to time, by
Union Texas Petroleum Holdings, Inc. Union Texas Petroleum Holdings, Inc.
also is registering hereunder an indeterminate number of shares of Common
Stock, Preferred Stock and Debt Securities as may be issued upon conversion
or exchange of any Debt Securities, Preferred Stock or Depositary Shares or
upon exercise of the Warrants registered hereby. If any Debt Securities
are being issued at an original issue discount, then the offering price
shall be in such greater principal amount as shall result in an aggregate
initial offering price not to exceed $500,000,000, less the dollar amount
of any securities previously issued hereunder. In no event will the
aggregate initial offering price of all securities issued from time to time
pursuant to this Registration Statement exceed $500,000,000, or its
equivalent if some or all of the securities are denominated in one or more
foreign currencies.
(4) To be represented by Depositary Receipts representing a fractional interest
in a share of Preferred Stock.
(5) Fee calculated pursuant to Rule 457(o).
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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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 JULY 10, 1997
PROSPECTUS
UNION TEXAS PETROLEUM HOLDINGS, INC.
DEBT SECURITIES [LOGO]
COMMON STOCK
PREFERRED STOCK
DEPOSITARY SHARES
WARRANTS
Union Texas Petroleum Holdings, Inc. (the "Company") may offer from
time to time (i) its unsecured debt securities ("Debt Securities") consisting of
debentures, notes and/or other evidences of unsecured indebtedness in one or
more series, (ii) shares of its common stock, par value $.05 per share ("Common
Stock"), (iii) shares of its preferred stock, par value $.01 per share
("Preferred Stock"), which may be issued in the form of depositary shares
evidenced by depositary receipts ("Depositary Shares"), (iv) warrants to
purchase Common Stock, Preferred Stock, Debt Securities or any combination
thereof ("Warrants," and together with the Common Stock, Preferred Stock and
Debt Securities, "Securities") or (v) any combination of the foregoing, at an
aggregate initial offering price not to exceed $500,000,000, or its equivalent
if some or all of the Securities are denominated in one or more foreign
currencies, at prices and on terms to be determined at or prior to the time of
sale in light of market conditions at the time of sale.
Specific terms of the particular Securities in respect of which this
Prospectus is being delivered will be set forth in one or more accompanying
Prospectus Supplements (each a "Prospectus Supplement"), together with the terms
of the offering of the Securities and the initial price and the net proceeds to
the Company from the sale thereof. The Prospectus Supplement will set forth with
regard to the particular Securities, without limitation, the following: (i) in
the case of Debt Securities, the specific designation, aggregate principal
amount, ranking as senior debt or subordinated debt, authorized denomination,
maturity, rate or method of calculation of interest and dates for payment
thereof, any exchangeability, conversion, redemption, prepayment or sinking fund
provisions, the currency or currencies or currency unit or currency units in
which principal, premium, if any, or interest, if any, is payable, any
modifications of or additions to the covenants described in this Prospectus and
any other specific terms thereof; (ii) in the case of Preferred Stock, the
designation, number of shares, liquidation preference per share, initial public
offering price, dividend rate (or method of calculation thereof), dates on which
dividends will be payable and dates from which dividends will accrue, any
redemption or sinking fund provisions, any conversion or exchange rights, any
other relative rights and whether the Company has elected to offer fractional
interests in the Preferred Stock in the form of Depositary Shares evidenced by
depositary receipts; (iii) in the case of Common Stock, the number of shares of
Common Stock and the terms of the offering and sale thereof; and (iv) in the
case of Warrants, the number and terms thereof, the designation and the number
of Securities issuable upon their exercise, the exercise price, the terms of the
offering and sale thereof and, where applicable, the duration and detachability
thereof. The Company's obligations under the Debt Securities will not be
guaranteed by any of its subsidiaries. The amounts payable by the Company in
respect of Debt Securities may be calculated by reference to the value, rate or
price of one or more specified commodities, currencies or indices to the extent
set forth in the Prospectus Supplement. The Prospectus Supplement will also
contain information, where applicable, about certain United States federal
income tax considerations relating to the Securities covered by the Prospectus
Supplement.
The outstanding Common Stock is listed on the New York Stock Exchange
and the Pacific Stock Exchange under the symbol "UTH." Any Common Stock offered
will be listed, subject to notice of issuance, on such exchanges. The
applicable Prospectus Supplement will contain information about any listing of
the other Securities on a securities exchange.
The Company may sell the Securities directly, through agents designated
from time to time or through underwriters or dealers. If any agents of the
Company or any underwriters or dealers are involved in the sale of the
Securities, the names of such agents, underwriters or dealers, any applicable
commissions and discounts, and the net proceeds to the Company will be set forth
in the applicable Prospectus Supplement. See "Plan of Distribution" for possible
indemnification arrangements for agents, underwriters and dealers.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF SECURITIES UNLESS
ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
The date of this Prospectus is ___________, 1997
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NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT IN
CONNECTION WITH THE OFFER CONTAINED IN THIS PROSPECTUS OR ANY PROSPECTUS
SUPPLEMENT, AND, IF GIVEN OR MADE, ANY SUCH INFORMATION OR REPRESENTATION MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS OR ANY PROSPECTUS
SUPPLEMENT DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER
TO BUY ANY SECURITIES BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR
SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS OR
ANY PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THEREOF OR THAT THE INFORMATION
CONTAINED HEREIN OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
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AVAILABLE INFORMATION
Union Texas Petroleum Holdings, Inc. 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").
Reports, proxy statements and other information filed by the Company may be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549, and at certain of the Commission's Regional Offices located at
Seven World Trade Center, 13th Floor, New York, New York 10048 and 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. The Commission maintains a
Web site that contains reports, proxy and information statements and other
information regarding registrants that file electronically with the Commission.
The address of the Commission's Web site is http://www.sec.gov. Copies of such
materials can be obtained by mail from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549,
at prescribed rates. In addition, the Company's Common Stock is listed on the
New York Stock Exchange and the Pacific Stock Exchange, and the Company's 8.25%
Senior Notes due 1999 (the "8.25% Senior Notes") are listed on the New York
Stock Exchange. The Company's reports, proxy statements and other information
filed under the Exchange Act may also be inspected and copied at the offices of
the New York Stock Exchange, 20 Broad Street, New York, New York 10005 and the
Pacific Stock Exchange, 301 Pine Street, San Francisco, California 94104.
The Company has 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
"Securities Act"). This Prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. For further
information, reference is hereby made to the Registration Statement and to the
exhibits and schedules filed therewith. All of these documents may be
inspected without charge at the Commission's principal office in Washington,
D.C., and copies thereof may be obtained from the Commission at the prescribed
rates or may be examined without charge at the public reference facilities of
the Commission.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission (File No. 1-9019)
pursuant to the Exchange Act are incorporated herein by reference: the
Company's Annual Report on Form 10-K for the year ended December 31, 1996; its
Quarterly Report on Form 10-Q for the quarter ended March 31, 1997; and its
Current Reports on Form 8-K filed January 24, 1997, February 13, 1997, April
23, 1997 and May 12, 1997.
All other documents filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of the offering of the Securities shall
be deemed to be incorporated by reference in this Prospectus and to be a part
hereof from the date of filing of such documents. Any statement contained 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 to the extent that a statement contained herein or in any
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified shall not be deemed to constitute a part of this Prospectus except as
so modified, and any statement so superseded shall not be deemed to constitute
part of this Prospectus.
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The Company will provide without charge to each person, including any
beneficial owner, to whom a copy of this Prospectus is delivered, upon the
written or oral request of any such person, a copy of any or all documents
which are incorporated herein by reference, other than exhibits to such
documents (unless such exhibits are specifically incorporated by reference into
such documents). Requests should be directed to the Company, at its principal
executive offices at 1330 Post Oak Boulevard, Houston, Texas 77056, Attention:
Corporate Secretary, telephone (713) 623-6544.
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Quantities of natural gas are expressed in this Prospectus in terms of
thousand cubic feet ("Mcf"), million cubic feet ("MMcf") or billion cubic feet
("Bcf"). Oil is quantified in terms of barrels ("Bbls"). Gas is converted into
a barrel of oil equivalent ("boe") based on 5.8 Mcf of gas to one barrel of
oil.
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THE COMPANY
The Company, the successor to a corporation founded in 1896, is an
independent (non-integrated) oil and gas company with worldwide operations. At
December 31, 1996, the Company had net proved oil and gas reserves of 443
million boe. The Company's average net daily oil and gas production during the
first three months of 1997 was approximately 62,000 Bbls and 422 MMcf,
respectively. All of the Company's oil and gas producing activities are
currently conducted outside of the United States, primarily in the U.K. sector
of the North Sea, Indonesia and Pakistan. The Company participates worldwide in
new venture exploration for oil and gas. The Company also operates a U.S.-based
petrochemical business.
As used herein, the "Company" means Union Texas Petroleum Holdings,
Inc. and its subsidiaries unless the context requires otherwise. The address
and telephone number of the Company's principal executive offices are 1330 Post
Oak Boulevard, Houston, Texas 77056, (713) 623-6544.
USE OF PROCEEDS
Except as otherwise described in the accompanying Prospectus
Supplement, the Company intends to use the net proceeds from the sale of the
Securities for general corporate purposes, which may include the repayment of
outstanding indebtedness, working capital increases, capital expenditures and
acquisitions. Pending application, such proceeds may be invested in short-term
obligations or qualified government or marketable securities. Any specific
allocations of the proceeds to a particular purpose that have been made at the
date of any Prospectus Supplement will be described therein.
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RATIO OF EARNINGS TO FIXED CHARGES
The Company's ratio of earnings to fixed charges was as follows for
the years and periods indicated:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
YEARS ENDED DECEMBER 31, MARCH 31,
------------------------------------------------------------------------- --------------------------
1992 1993 1994 1995 1996 1996 1997
----- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
7.93 1.61 7.31 5.52 7.84 8.06 11.41
</TABLE>
For purposes of computing the ratio of earnings to fixed charges,
earnings consist of pretax income plus fixed charges (excluding interest
capitalized during the period). Fixed charges consist of interest expense,
capitalized interest, amortization of discount and financing costs and the
portion of rent expense which is deemed to be representative of the interest
component of rent expense.
DESCRIPTION OF THE DEBT SECURITIES
The following description of the Debt Securities sets forth certain
general terms and provisions of the Debt Securities to which any Prospectus
Supplement may relate. The particular terms of the Debt Securities and the
extent to which such general provisions may apply will be described in a
Prospectus Supplement relating to such Debt Securities.
The Debt Securities will be general unsecured obligations of the
Company and will constitute either senior debt securities or subordinated debt
securities. In the case of Debt Securities that will be senior debt securities
("Senior Debt Securities"), the Debt Securities will be issued under an
Indenture, as amended and supplemented (the "Senior Indenture") between the
Company and The First National Bank of Chicago, as trustee under the Senior
Indenture. In the case of Debt Securities that will be subordinated debt
securities ("Subordinated Debt Securities"), the Debt Securities will be issued
under an Indenture (the "Subordinated Indenture") to be entered into between
the Company and The First National Bank of Chicago, as trustee under the
Subordinated Indenture. The Senior Indenture and the Subordinated Indenture are
sometimes hereinafter referred to individually as an "Indenture" and
collectively as the "Indentures." Copies of the Senior Indenture and the form
of the Subordinated Indenture have been filed or incorporated by reference as
exhibits to the Registration Statement. The First National Bank of Chicago, as
trustee under each of the Indentures (and any successor thereto under each
Indenture), is referred to herein as the "Trustee." The statements under this
caption relating to the Debt Securities and the Indentures are summaries only
and do not purport to be complete. Such summaries make use of terms defined in
the Indentures. Wherever such terms are used herein or particular provisions of
an Indenture are referred to, such terms or provisions, as the case may be, are
incorporated by reference as part of the statements made herein, and such
statements are qualified in their entirety by such reference. Certain defined
terms in the Indentures are capitalized herein. The italicized references below
apply to the article or section numbers in the Senior Indenture and
Subordinated Indenture, respectively, or to both Indentures if only one
reference is provided, unless otherwise indicated.
PROVISIONS APPLICABLE TO BOTH SENIOR AND SUBORDINATED DEBT SECURITIES
The Indentures do not limit the aggregate principal amount of Debt
Securities that can be issued thereunder and provide that Debt Securities may
be issued from time to time thereunder in one or more series, each in an
aggregate principal amount authorized by the Company prior to issuance. The
Debt Securities may be issued at various times with different maturity dates
and different principal repayment provisions, may bear interest at different
rates, may be payable in currencies other than United States dollars, in
composite currencies or in amounts determined by reference to the price, rate
or value of one or more specified commodities, currencies or indices, and may
otherwise vary, all as provided in the Indentures. The Company has from time to
time entered into, and will in the future enter into, credit or other financing
agreements to fund its operations, herein referred to collectively as the
"Credit Facilities." Such credit or other financing agreements may be secured
by the assets of the Company, secured by the assets of subsidiaries of the
Company or guaranteed by subsidiaries of the Company. To the extent that the
Credit Facilities are so secured or guaranteed, the lenders under such Credit
Facilities may have priority over the holders of the Debt Securities with
respect to the assets of the Company or its subsidiaries that secure such
Credit Facilities and may have priority over the holders of the Debt
Securities.
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General. Unless otherwise indicated in a Prospectus Supplement, the
Debt Securities will not benefit from any covenant or other provision that
would afford holders of such Debt Securities special protection in the event of
a highly leveraged transaction involving the Company.
Reference is made to the applicable Prospectus Supplement for the
following terms of the particular series of Debt Securities offered hereby: (i)
the title and aggregate principal amount of the Debt Securities; (ii) the date
or dates on which the Debt Securities will mature; (iii) the rate or rates
(which may be fixed or variable) per annum, if any, at which the Debt Securities
will bear interest or the method of determining such rate or rates; (iv) the
date or dates from which such interest, if any, will accrue and the date or
dates at which such interest, if any, will be payable; (v) the terms for
redemption or early payment, if any, including any mandatory or optional sinking
fund or analogous provision; (vi) the terms for conversion or exchange, if any,
of the Debt Securities; (vii) whether, and the extent to which, the Company's
obligations under the Debt Securities will be guaranteed by any of the Company's
subsidiaries; (viii) whether such Debt Securities will be issued in fully
registered form or in bearer form or any combination thereof; (ix) whether such
Debt Securities will be issued in the form of one or more global securities and
whether such global securities are to be issuable in temporary global form or
permanent global form; (x) information with respect to book-entry procedures, if
any; (xi) the currency, currencies or currency unit or units in which such Debt
Securities will be denominated and in which the principal of, and premium and
interest, if any, on such Debt Securities will be payable; (xii) whether, and
the terms and conditions on which, the Company or a holder may elect that, or
the other circumstances under which, payment of principal of, or premium or
interest, if any, on such Debt Securities is to be made in a currency or
currencies or currency unit or units other than that in which such Debt
Securities are denominated; (xiii) any index or formula to be used to determine
the amount of payments of principal of (and premium, if any) and interest on
such Debt Securities and any commodities, currencies, currency units or indices,
or value, rate or price, relevant to such determination; (xiv) the terms, if
any, upon which such Debt Securities may be convertible into Common Stock or
other securities or property of the Company and the terms and conditions upon
which such conversion may be effected, including the initial conversion price or
rate and any other provision in addition to or in lieu of those described herein
and (xv) any other specific terms of the Debt Securities. (Section 301)
Reference is also made to the applicable Prospectus Supplement for information
with respect to (x) the classification of the Debt Securities as Senior Debt
Securities or Subordinated Debt Securities, (y) the price (expressed as a
percentage of the aggregate principal amount of the Debt Securities) at which
the Debt Securities will be issued, if other than 100 percent, and (z) any
additional covenants that may be included in the terms of the Debt Securities.
No service charge will be made for any registration of transfer or
exchange of the Debt Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. (Section 305)
The Company currently conducts all of its operations through
subsidiaries, and the holders of Debt Securities will generally have a junior
position to any claims of creditors and any preferred stockholders of the
Company's subsidiaries. Claims of creditors of such subsidiaries, including
trade creditors, secured creditors, taxing authorities and creditors holding
guarantees, and claims of holders of any preferred stock will generally have
priority as to the assets of such subsidiaries over the claims and equity
interests of the Company and, thereby, indirectly, the holders of indebtedness
of the Company, including the Debt Securities. See "-- Provisions Applicable
Solely to Senior Debt Securities."
Debt Securities may be sold at a discount (which may be substantial)
below their stated principal amount bearing no interest or interest at a rate
which at the time of issuance is below market rates. Any material United States
federal income tax consequences and other special considerations applicable
thereto will be described in the Prospectus Supplement relating to any such
Debt Securities.
If any of the Debt Securities are sold for any foreign currency or
currency unit or if the principal of, or premium or interest, if any, on any of
the Debt Securities is payable in any foreign currency or currency unit, the
restrictions, elections, tax consequences, specific terms and other information
with respect to such Debt Securities and such foreign currency or currency unit
will be set forth in the Prospectus Supplement relating thereto.
Covenants. The Indentures require the Company to covenant, among other
things, with respect to each series of Debt Securities: (i) to duly and
punctually pay the principal of (and premium, if any) and interest, if any, on
such series of Debt Securities; (ii) to maintain an office or agency in each
Place of Payment where Debt Securities may be presented or surrendered for
payment, transferred or exchanged and where notices to the Company may be
served; (iii) if the Company shall act as its own Paying Agent for any series
of Debt Securities, to segregate and hold in trust for the benefit of the
Persons entitled thereto a sum sufficient to pay the principal (and premium, if
any) or interest, if any, so
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becoming due; (iv) to deliver to the Trustee, within 120 days after the end of
each fiscal year, a written statement to the effect that the Company has
fulfilled all its obligations under the Indentures throughout such year; (v) to
preserve its corporate existence; (vi) to maintain its properties; and (vii) to
pay taxes and other claims, in each case, as required by the Indentures.
(Article Eleven; Article Ten)
Events of Default. Unless otherwise provided with respect to any
series of Debt Securities, the following are Events of Default under each
Indenture with respect to the Debt Securities of such series issued under the
Indenture: (a) failure to pay principal of (or premium, if any, on) any Debt
Security of such series when due; (b) failure to pay any interest on any Debt
Security of such series when due, continued for 30 days; (c) failure to deposit
any mandatory sinking fund payment, when due, in respect of the Debt Securities
of such series; (d) failure to perform any other covenant of the Company in the
applicable Indenture (other than a covenant included in the applicable
Indenture for the benefit of a series of Debt Securities other than such
series), continued for 60 days after written notice as provided in the
applicable Indenture; (e) certain events of bankruptcy, insolvency or
reorganization; and (f) any other Event of Default as may be established with
respect to Debt Securities of such series (including, without limitation, any
Event of Default arising out of a default which results in the acceleration of
certain Indebtedness or a default in the payment of any amounts due on certain
Indebtedness). (Sections 301 and 601; Sections 301 and 501) If an Event of
Default with respect to any outstanding series of Debt Securities occurs and is
continuing, either the Trustee or the holders of at least 25% in principal
amount of the outstanding Debt Securities of such series (subject to the
following sentence, in the case of an Event of Default described in clause (a),
(b), (c) or (f) above) or at least 25% in principal amount of all outstanding
Debt Securities under the Indenture (subject to the following sentence, in the
case of other Events of Default) may declare the principal amount of all the
Debt Securities of the applicable series (or of all outstanding Debt Securities
under the applicable Indenture, as the case may be) to be due and payable
immediately. If an Event of Default described in clause (e) shall occur, the
principal amount of the Debt Securities of all series ipso facto shall become
and be immediately due and payable without any declaration or other act on the
part of the Trustee or any holder. At any time after a declaration of
acceleration has been made, but before a judgment has been obtained, the
holders of a majority in principal amount of the outstanding Debt Securities of
such series (or all outstanding Debt Securities under the applicable Indenture,
as the case may be) may, under certain circumstances, rescind and annul such
acceleration. (Section 602; Section 502) Depending on the terms of other
Indebtedness of the Company outstanding from time to time, an Event of Default
under an Indenture may give rise to cross defaults on such other Indebtedness
of the Company.
Each Indenture provides that the Trustee will, within 90 days after
the occurrence of a default in respect of any series of Debt Securities, give
to the holders of the Debt Securities of such series notice of all uncured and
unwaived defaults known to it; provided, however, that, except in the case of a
default in the payment of the principal of (or premium, if any) or any interest
on, or any sinking fund installment with respect to, any Debt Securities of
such series, the Trustee will be protected in withholding such notice if it in
good faith determines that the withholding of such notice is in the interest of
the holders of the Debt Securities of such series; and provided, further, that
such notice shall not be given until at least 30 days after the occurrence of a
default in the performance, or breach, of any covenant or warranty of the
Company under such Indenture other than for the payment of the principal of (or
premium, if any) or any interest on, or any sinking fund installment with
respect to, any Debt Securities of such series. For the purpose of this
provision, "default" with respect to Debt Securities of any series means any
event which is, or after notice or lapse of time, or both, would become, an
Event of Default with respect to the Debt Securities of such series. (Section
702; Section 602)
The holders of a majority in principal amount of the outstanding Debt
Securities of any series (or, in certain cases, all outstanding Debt Securities
under the applicable Indenture) have the right, subject to certain limitations,
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 Debt Securities of such series (or of all
outstanding Debt Securities under the applicable Indenture). (Section 612;
Section 512) Each Indenture provides that in case an Event of Default shall
occur and be continuing with respect to the Debt Securities of any series, the
Trustee shall exercise such of its rights and powers under the applicable
Indenture and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
his own affairs. (Section 701; Section 601) Subject to such provisions, the
Trustee will be under no obligation to exercise any of its rights or powers
under either Indenture at the request of any of the holders of the Debt
Securities unless they shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities that might be incurred by
it in compliance with such request. (Section 703; Section 603)
The holders of a majority in principal amount of the outstanding Debt
Securities of any series (or, in certain cases, all outstanding Debt Securities
under the applicable Indenture) may on behalf of the holders of all Debt
Securities of such series (or of all outstanding Debt Securities under the
applicable Indenture) waive any past default under the
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Indenture, except a default in the payment of the principal of (or premium, if
any) or interest on any Debt Security or in respect of a provision which under
the applicable Indenture cannot be modified or amended without the consent of
the holder of each outstanding Debt Security affected. (Section 613; Section
513) The holders of a majority in principal amount of the outstanding Debt
Securities affected thereby may on behalf of the holders of all such Debt
Securities waive compliance by the Company with certain restrictive provisions
of the Indenture. (Section 1110; Section 1008)
The Company is required to furnish to the Trustee annually a statement
as to the performance by the Company of certain of its obligations under each
Indenture and as to any default in such performance. (Section 1109; Section
1007)
Modification. Modifications and amendments of each Indenture may be
made by the Company and the Trustee with the consent of the holders of a
majority in principal amount of the outstanding Debt Securities under the
Indenture affected thereby, provided, however, that no such modification or
amendment may, without the consent of the holder of each outstanding Debt
Security affected thereby, (a) change the stated maturity date of the principal
of, or any installment of interest on, any Debt Security, (b) reduce the
principal amount of, or the premium (if any) or interest on, any Debt Security,
(c) change the Place of Payment or currency, currencies, or currency unit or
units of payment of principal of, or premium (if any) or interest on, any Debt
Security, (d) impair the right to institute suit for the enforcement of any
payment on or with respect to any Debt Security or (e) reduce the percentage in
principal amount of outstanding Debt Securities the consent of whose holders is
required for modification or amendment of the Indentures or for waiver of
compliance with certain provisions of the Indentures or for waiver of certain
defaults. (Section 1002; Section 902)
Each Indenture provides that the Company and the Trustee may, without
the consent of any holders of Debt Securities, enter into supplemental
indentures for the purposes, among other things, of adding to the Company's
covenants, securing the Debt Securities, adding additional Events of Default,
establishing the form or terms of Debt Securities or curing ambiguities or
inconsistencies in the applicable Indenture, provided such action to cure
ambiguities or inconsistencies shall not adversely affect the interests of the
holders of the Debt Securities in any material respect. (Section 1001; Section
901)
Consolidation, Merger and Sale of Assets. The Company, without the
consent of any holders of outstanding Debt Securities, may consolidate with or
merge into, or convey, transfer or lease its assets substantially as an
entirety to, any Person, provided that the Person formed by such consolidation
or into which the Company is merged or which acquires or leases the assets of
the Company substantially as an entirety is a corporation, partnership or trust
organized under the laws of any United States jurisdiction and assumes by
supplemental indenture the Company's obligations on the Debt Securities and
under the Indenture, that after giving effect to 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, and that
certain other conditions are met. Upon compliance with these provisions by a
successor Person, the Company will (except in the case of a lease) be relieved
of its obligations under the Indenture and the Debt Securities. (Article Nine;
Article Eight)
Discharge and Defeasance. The Company may terminate its obligations
under each Indenture with respect to Debt Securities of any series, other than
its obligation to pay the principal of (and premium, if any) and interest on
such Debt Securities and certain other obligations, if it (i) irrevocably
deposits or causes to be irrevocably deposited with the Trustee as trust funds
money or U.S. Government Obligations maturing as to principal and interest
sufficient to pay the principal of, any interest on, and any mandatory sinking
funds in respect of, all outstanding Debt Securities of such series on the
stated maturity of such payments or on any redemption date, (ii) has delivered
to the Trustee an opinion of counsel to the effect that the holders of Debt
Securities of such series will not recognize income, gain or loss for United
States federal income tax purposes as a result of such discharge and will be
subject to United States federal income tax on the same amount and in the same
manner and at the same time as would have been the case if such discharge had
not occurred, and (iii) complies with any additional conditions specified to be
applicable with respect to the covenant defeasance of Debt Securities of such
series, and no default or Event of Default with respect to the Debt Securities
of such series shall have occurred and be continuing on the date of such
deposit or, insofar as they relate to certain events of bankruptcy or
insolvency, at any time in the period ending on the 91st day after the date of
such deposit (it being understood that this condition shall not be deemed
satisfied until the expiration of such period). (Section 501; Section 401)
The terms of any series of Debt Securities may also provide for legal
defeasance pursuant to each Indenture. In such case, if the Company (i)
irrevocably deposits or causes to be irrevocably deposited money or U.S.
Government Obligations as described above and complies with the other
provisions described above (except that the opinion referred
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to in clause (ii) above must be based on a ruling by the Internal Revenue
Service or other change under applicable United States federal income tax law),
(ii) makes a request to the Trustee to be discharged from its obligations on
the Debt Securities of such series and (iii) complies with any additional
conditions specified to be applicable with respect to legal defeasance of Debt
Securities of such series, then the Company shall be deemed to have paid and
discharged the entire indebtedness on all the outstanding Debt Securities of
such series, and the obligations of the Company under the applicable Indenture
and the Debt Securities of such series to pay the principal of (and premium, if
any) and interest on the Debt Securities of such series shall cease, terminate
and be completely discharged and the holders thereof shall thereafter be
entitled only to payment out of the money or U.S. Government Obligations
deposited with the Trustee as aforesaid, unless the Company's obligations are
revived and reinstated because the Trustee is unable to apply such trust fund
by reason of any legal proceeding, order or judgment. (Sections 503 and 504;
Sections 403 and 404)
Conversion Rights. The terms on which Debt Securities of any series
are convertible into or exchangeable for Common Stock or other securities or
property of the Company will be set forth in the Prospectus Supplement relating
thereto. Such terms shall include provisions as to whether conversion or
exchange is mandatory, at the option of the holder or at the option of the
Company, and may include provisions pursuant to which the number of shares of
Common Stock or other securities of the Company to be received by the holders
of Debt Securities would be calculated according to the market price of Common
Stock or other securities of the Company as of a time stated in the Prospectus
Supplement. The conversion price of any Debt Securities of any series that is
convertible into Common Stock or other securities of the Company may be
adjusted for any stock dividends, stock splits, reclassification, combinations
or similar transactions, as set forth in the applicable Prospectus Supplement.
Form, Exchange, Registration and Transfer. Debt Securities are
issuable in definitive form as Registered Debt Securities, as Bearer Debt
Securities or both. Unless otherwise indicated in an applicable Prospectus
Supplement, Bearer Debt Securities will have interest coupons attached. Debt
Securities are also issuable in temporary or permanent global form. (Section
301)
Registered Debt Securities of any series will be exchangeable for
other Registered Debt Securities of the same series and of a like aggregate
principal amount and tenor of different authorized denominations. In addition,
with respect to any series of Bearer Debt Securities, at the option of the
holder, subject to the terms of the applicable Indenture, Bearer Debt
Securities (with all unmatured coupons, except as provided below, and all
matured coupons in default) of such series will be exchangeable into Registered
Securities of the same series of any authorized denominations and of a like
aggregate principal amount and tenor. Bearer Debt Securities surrendered in
exchange for Registered Debt Securities between a Regular Record Date or a
Special Record Date and the relevant date for payment of interest shall be
surrendered without the coupon relating to such date for payment of interest,
and interest accrued as of such date will not be payable in respect of the
Registered Debt Security issued in exchange for such Bearer Debt Security, but
will be payable only to the holder of such coupon when due in accordance with
the terms of the applicable Indenture. (Section 305)
In connection with its sale during the restricted period (as defined
below), no Bearer Debt Security (including a Debt Security in permanent global
form that is either a Bearer Debt Security or exchangeable for Bearer Debt
Securities) shall be mailed or otherwise delivered to any location in the
United States (as defined under "-- Limitations on Issuance of Bearer Debt
Securities"), and a Bearer Debt Security may be delivered outside the United
States in definitive form in connection with the original issuance only if
prior to delivery the Person entitled to receive such Bearer Debt Security
furnishes written certification, in the form required by the applicable
Indenture, to the effect that such Bearer Debt Security is owned by: (a) a
Person (purchasing for its own account) who is not a United States Person (as
defined under "-- Limitations on Issuance of Bearer Debt Securities"); (b) a
United States Person who (i) is a foreign branch of a United States financial
institution purchasing for its own account or for resale or (ii) acquired such
Bearer Debt Security through the foreign branch of a United States financial
institution and who for purposes of the certification holds such Bearer Debt
Security through such financial institution on the date of certification and,
in either case, such United States financial institution certifies to the
Company or the distributor selling the Bearer Debt Security within a reasonable
time stating that it agrees to comply with the requirements of Section
165(j)(3)(A), (B) or (C) of the United States Internal Revenue Code of 1986, as
amended (the "Code"), and the regulations thereunder; or a United States or
foreign financial institution for purposes of resale within the "restricted
period" as defined in United States Treasury Regulations Section
1.163-5(c)(2)(i)(D)(7). A financial institution described in clause (c) of the
preceding sentence (whether or not also described in clauses (a) and (b)) must
certify that it has not acquired the Bearer Debt Security for the purpose of
resale, directly or indirectly, to a United States Person or to a person within
the United States or its possessions. In the case of a Bearer Debt Security in
permanent global form, such certification must be given in
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connection with notation of a beneficial owner's interest therein in connection
with the original issuance of such Debt Security or upon exchange of a portion
of a temporary global Security. (Section 303) See "-- Limitations on Issuance
of Bearer Debt Securities."
Debt Securities may be presented for exchange as provided above, and
Registered Debt Securities may be presented for registration of transfer (with
the form of transfer endorsed thereon duly executed), at the office of the
Security Registrar or at the office of any transfer agent designated by the
Company for such purpose with respect to any series of Debt Securities and
referred to in an applicable Prospectus Supplement, without a service charge
and upon payment of any taxes and other governmental charges as described in
the applicable Indenture. Such transfer or exchange will be effected upon the
Security Registrar or such transfer agent, as the case may be, being satisfied
with the document of title and identity of the Person making the request. The
Company has appointed the Trustee as Security Registrar. (Section 305) If a
Prospectus Supplement refers to any transfer agents (in addition to the
Security Registrar) initially designated by the Company with respect to any
series of Debt Securities, the Company may at any time rescind the designation
of any such transfer agent or approve a change in the location through which
any such transfer agent acts, except that, if Debt Securities of a series are
issuable solely as Registered Debt Securities, the Company will be required to
maintain a transfer agent in each Place of Payment for such series and, if Debt
Securities of a series are issuable as Bearer Debt Securities, the Company will
be required to maintain (in addition to the Security Registrar) a transfer
agent in a Place of Payment located outside the United States for Bearer Debt
Securities and Registered Securities of such series. The Company may at any
time designate additional transfer agents with respect to any series of Debt
Securities. (Section 1102; Section 1002)
In the event of any redemption in part, the Company shall not be
required to (i) issue, register the transfer of or exchange Debt Securities of
any series during a period beginning at the opening of business 15 days prior
to the selection of Debt Securities of that series for redemption and ending on
the close of business on, (A) if Debt Securities of the series are issuable
only as Registered Debt Securities, the day of mailing of the relevant notice
of redemption and, (B) if Debt Securities of the series are issuable as Bearer
Debt Securities, the day of the first publication of the relevant notice of
redemption, except that, if Securities of the series are also issuable as
Registered Debt Securities and there is no publication, the day of mailing of
the relevant notice of redemption; (ii) register the transfer of or exchange
any Registered Debt Security, or portion thereof, called for redemption, except
the unredeemed portion of any Registered Debt Security being redeemed in part;
or (iii) exchange any Bearer Debt Security called for redemption, except to
exchange such Bearer Debt Security for a Registered Debt Security of that
series and like tenor that is simultaneously surrendered for redemption.
(Section 305)
Payment and Paying Agents. Unless otherwise indicated in an applicable
Prospectus Supplement, payment of principal of and any premium and interest on
Bearer Debt Securities will be payable, subject to any applicable laws and
regulations in the designated currency or currency unit, at the offices of such
Paying Agents outside the United States as the Company may designate from time
to time, at the option of the holder, by check or by transfer to an account
maintained by the payee with a bank located outside the United States;
provided, however, that the written certification described above under "--
Form, Exchange, Registration and Transfer" has been delivered prior to the
first actual payment of interest. (Section 307) Unless otherwise indicated in
an applicable Prospectus Supplement, payment of interest on Bearer Debt
Securities on any Interest Payment Date will be made only against surrender to
the Paying Agent of the coupon relating to such Interest Payment Date. (Section
1101; Section 1001) No payment with respect to any Bearer Debt Security will be
made at any office or agency of the Company in the United States or by check
mailed to any address in the United States or by transfer to any account
maintained with a bank located in the United States, nor shall any payments be
made in respect of Bearer Debt Securities upon presentation to the Company or
its designated Paying Agents within the United States. Notwithstanding the
foregoing, payments of principal of and any premium and interest on Bearer Debt
Securities denominated and payable in U.S. dollars will be made at the office
of the Company's Paying Agent in the Borough of Manhattan, The City of New
York, if (but only if) payment of the full amount thereof in United States
dollars at all offices or agencies outside the United States is illegal or
effectively precluded by exchange controls or other similar restrictions.
(Section 1102; Section 1002)
Unless otherwise indicated in an applicable Prospectus Supplement,
payment of principal of and any premium and interest on Registered Debt
Securities will be made in the designated currency or currency unit at the
office of such Paying Agent or Paying Agents as the Company may designate from
time to time, except that at the option of the Company payment of any interest
may be made by check mailed to the address of the Person entitled thereto as
such address shall appear in the Security Register. Unless otherwise indicated
in an applicable Prospectus Supplement, payment of any installment of interest
on Registered Debt Securities will be made to the Person in whose name such
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Registered Debt Security is registered at the close of business on the Regular
Record Date for such interest. (Section 307)
Unless otherwise indicated in an applicable Prospectus Supplement, the
Corporate Trust Office of the Trustee in the Borough of Manhattan, The City of
New York will be designated as a Paying Agent for the Company for payments with
respect to Debt Securities which are issuable solely as Registered Debt
Securities, and the Company will maintain a Paying Agent outside the United
States for payments with respect to Debt Securities (subject to limitations
described above in the case of Bearer Debt Securities) which are issuable
solely as Bearer Debt Securities, or as both Registered Debt Securities and
Bearer Debt Securities. Any Paying Agents outside the United States and any
other Paying Agents in the United States initially designated by the Company
for the Debt Securities will be named in an applicable Prospectus Supplement.
The Company 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, except that, if Debt Securities of a series are issuable
solely as Registered Debt Securities, the Company will be required to maintain
a Paying Agent in each Place of Payment for such series and, if Debt Securities
of a series are issuable as Bearer Debt Securities, the Company will be
required to maintain (I) a Paying Agent in the Borough of Manhattan, The City
of New York for principal payments with respect to any Registered Debt
Securities of the series (and for payments with respect to Bearer Debt
Securities of the series in the circumstances described above, but not
otherwise), and (ii) a Paying Agent in a Place of Payment located outside the
United States where securities of such series and any coupons appertaining
thereto may be presented and surrendered for payment; provided that if the Debt
Securities of such series are listed on any stock exchange located outside the
United States and such stock exchange shall so require, the Company will
maintain a Paying Agent in a city located outside the United States, as may be
required, for the Debt Securities of such series. (Section 1102; Section 1002)
All moneys paid by the Company to a Paying Agent for the payment of
principal of and any premium or interest on any Debt Security which remain
unclaimed at the end of three years after such principal, premium or interest
shall have become due and payable will (subject to applicable escheat laws) be
repaid to the Company, and the holder of such Debt Security or any coupon will
thereafter look only to the Company for payment thereof. (Section 1103; Section
1003)
Temporary Global Securities. If so specified in an applicable
Prospectus Supplement, all or any portion of the Debt Securities of a series
which are issuable as Bearer Debt Securities will initially be represented by
one or more temporary global Debt Securities, without interest coupons, to be
deposited with a common depositary in London for the Euroclear System
("Euroclear") and CEDEL S.A. ("CEDEL") for credit to the designated accounts.
On and after the date determined as provided in any such temporary global Debt
Security and described in an applicable Prospectus Supplement, each such
temporary global Debt Security will be exchangeable for definitive Bearer Debt
Securities, definitive Registered Debt Securities or all or a portion of a
permanent global security, or any combination thereof, as specified in an
applicable Prospectus Supplement, but, unless otherwise specified in an
applicable Prospectus Supplement only upon written certification in the form
and to the effect described under "-- Form, Exchange, Registration and
Transfer." No Bearer Debt Security delivered in exchange for a portion of a
temporary global Debt Security will be mailed or otherwise delivered to any
location in the United States in connection with such exchange. (Section 304)
Unless otherwise specified in an applicable Prospectus Supplement,
interest in respect of any portion of a temporary global Debt Security payable
in respect of an Interest Payment Date occurring prior to the issuance of
definitive Debt Securities or a permanent global Debt Security will be paid to
each of Euroclear and CEDEL with respect to the portion of the temporary global
Debt Security held for its account. Each of Euroclear and CEDEL will undertake
in such circumstances to credit such interest received by it in respect of a
temporary global Debt Security to the respective accounts for which it holds
such temporary global Debt Security only upon receipt in each case of written
certification in the form and to the effect described above under "-- Form,
Exchange, Registration and Transfer" as of the relevant Interest Payment Date
regarding the portion of such temporary global Debt Security on which interest
is to be so credited. (Section 304)
Permanent Global Securities. If any Debt Securities of a series are
issuable in permanent global form, the applicable Prospectus Supplement will
describe the circumstances, if any, under which beneficial owners of interests
in any such permanent global Debt Securities may exchange such interest for
Debt Securities of such series and of like tenor and principal amount in any
authorized form and denomination. No Bearer Debt Security delivered in exchange
for a portion of a permanent global Debt Security shall be mailed or otherwise
delivered to any location in the United States in connection with such
exchange. (Section 305) A Person having a beneficial interest in a permanent
global Debt
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Security will, except with respect to payment of principal of and any premium
and interest on such permanent global Debt Security, be treated as a holder of
such principal amount of Outstanding Debt Securities represented by such
permanent global Debt Security as shall be specified in a written statement of
the holder of such permanent global Debt Security or, in the case of a
permanent global Debt Security in bearer form, of the operator of Euroclear or
CEDEL which is provided to the Trustee by such Person. Principal of and any
premium and interest on a permanent global Debt Security will be payable in the
manner described in the applicable Prospectus Supplement. (Section 203)
Book-Entry Debt Securities. The Debt Securities of a series may be
issued in whole or in part, in the form of one or more global Debt Securities
that would be deposited with a depositary or a nominee identified in the
applicable Prospectus Supplement. The specific terms of any depositary
arrangement with respect to any portion of a series of Debt Securities and the
rights of, and limitations on, owners of beneficial interests in any such
global Debt Security representing all or a portion of a series of Debt
Securities will be described in the applicable Prospectus Supplement. (Section
204)
Limitations on Issuance of Bearer Debt Securities. In compliance with
United States federal tax laws and regulations, Bearer Debt Securities
(including securities in permanent global form that are either Bearer Debt
Securities or exchangeable for Bearer Debt Securities) will not be offered or
sold during the restricted period (as defined in United States Treasury
Regulations Section 1.163-5(c)(2)(i)(D)(7)) (generally, the first 40 days after
the closing date, and with respect to unsold allotments, until sold) within the
United States or to United States Persons (each as defined below) other than to
an office located outside the United States of a United States financial
institution (as defined in Section 1.165-12(c)(1)(v) of the United States
Treasury Regulations), purchasing for its own account or for resale or for the
account of certain customers, that provides a certificate stating that it
agrees to comply with the requirements of Section 165(j)(3)(A), (B) or (C) of
the Code and the United States Treasury Regulations thereunder, or to certain
other Persons described in Section 1.163-5(c)(2)(i)(D)(l)(iii)(B) of the United
States Treasury Regulations. Moreover, such Bearer Debt Securities will not be
delivered in connection with their sale during the restricted period within the
United States. Any underwriters, agents and dealers participating in the
offering of Bearer Debt Securities must covenant that they will not offer or
sell during the restricted period any Bearer Debt Securities within the United
States or to United States Persons (other than the persons described above) or
deliver in connection with the sale of Bearer Debt Securities during the
restricted period any Bearer Debt Securities within the United States and that
they have in effect procedures reasonably designed to ensure that their
employees and agents who are directly engaged in selling the Bearer Debt
Securities are aware of the restrictions described above. No Bearer Debt
Security (other than a temporary global Bearer Debt Security) will be delivered
in connection with its original issuance nor will interest be paid on any
Bearer Debt Security until receipt by the Company of the written certification
described above under "-- Form, Exchange, Registration and Transfer." Each
Bearer Debt Security, other than a temporary global Bearer Debt Security, will
bear a legend to the following effect: "Any United States person who holds this
obligation will be subject to limitations under the United States income tax
laws, including the limitations provided in Sections 165(j) and 1287(a) of the
Internal Revenue Code."
As used herein "United States Person" means any citizen or resident of
the United States, any corporation, partnership or other entity created or
organized in or under the laws of the United States and any estate or trust the
income of which is subject to United States federal income taxation regardless
of its source, and "United States" means the United States of America
(including the states and the District of Columbia) and its possessions.
Meetings. The Indentures contain provisions for convening meetings of
the holders of Debt Securities of a series. A meeting may be called at any time
by the Trustee, and also, upon request, by the Company or the holders of at
least 25% in principal amount of the Outstanding Debt Securities of such
series, in any such case upon notice given as described under "-- Notices"
below. Except for any consent that must be given by the holder of each
Outstanding Debt Security affected thereby, as described under
"-- Modification" above, any resolution presented at a meeting or adjourned
meeting at which a quorum is present may be adopted by the affirmative vote of
the holders of a majority in principal amount of the Outstanding Debt
Securities of that series; provided, however, that except for any consent that
must be given by the holder of each Outstanding Debt Security affected thereby,
as described under "-- Modification" above, any resolution with respect to any
request, demand, authorization, direction, notice, consent, waiver or other
action that may be made, given or taken by the holders of a specified
percentage, which is less than a majority in principal amount of the
Outstanding Debt Securities of a series may be adopted at a meeting or
adjourned meeting duly reconvened at which a quorum is present by the
affirmative vote of the holders of such specified percentage in principal
amount of the Outstanding Debt Securities of that series. Subject to the
proviso set forth above, any resolution passed or action taken at any meeting
of holders of Debt Securities of any series duly held in accordance with the
Indenture will be binding on all holders of Debt Securities of that series and
any related coupons. The quorum at any meeting
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called to adopt a resolution, and at any reconvened meeting, will be Persons
holding or representing a majority in principal amount of the Outstanding Debt
Securities of a series. (Article Fourteen)
Notices. Except as otherwise provided in the Indentures, notices to
holders of Bearer Debt Securities will be given by publication at least twice
in a daily newspaper in The City of New York and in such other city or cities
as may be specified in such Debt Securities. Notices to holders of Registered
Debt Securities will be given by mail to the addresses of such holders as they
appear in the Security Register. (Section 107)
The Trustee. The Indentures provide that the Trustee shall
authenticate and deliver Debt Securities of a particular series in accordance
with a Company Order. Each Indenture contains certain limitations on the right
of the Trustee, should it become a creditor of the Company, to obtain payment
of claims in certain cases and to realize certain property received with
respect to any such claims, as security or otherwise. (Section 713; Section
613) The Trustee is one of the lenders under certain of the Company's Credit
Facilities. The Trustee is permitted to engage in other transactions, except
that, if it acquires any conflicting interest and there is a default under the
Debt Securities, it must eliminate such conflict or resign. (Section 708;
Section 608)
Governing Law. The Indentures are, and the Debt Securities will be,
governed by and construed in accordance with the laws of the State of New York,
but without giving effect to principles of conflicts of law.
PROVISIONS APPLICABLE SOLELY TO SENIOR DEBT SECURITIES
Senior Debt Securities will be issued under the Senior Indenture and
will rank pari passu in right of payment with the Company's obligations under
its Credit Facilities, its 8.25% Senior Notes due 1999, 8 3/8% Senior Notes due
2005, 8 1/2% Senior Notes due 2007 and Medium Term Notes, Series A
(collectively, the "Senior Notes") and all other unsecured and unsubordinated
debt of the Company, and will be senior in right of payment to all existing and
future debt of the Company that is, by its terms, expressly subordinated to the
Senior Debt Securities. The Senior Debt Securities issued under this Prospectus
will not be guaranteed by any subsidiary of the Company and will not rank pari
passu with any debt of such subsidiary, but will be senior in right of payment
to all existing and future debt of such subsidiary that is, by its terms,
expressly subordinated to the Senior Debt Securities.
Under the terms of the Indenture, if any Subsidiary of the Company
guarantees any Funded Indebtedness of the Company at any time in the future,
then the Company will cause the Senior Debt Securities to be equally, ratably
and unconditionally guaranteed by such Subsidiary (a "Guarantor") as an
unsecured obligation (the "Guarantee"). Any Guarantee of a Senior Debt Security
by a Guarantor will rank pari passu with (i) the guarantees provided by such
Guarantor under any Funded Indebtedness of the Company, including the Senior
Notes, and (ii) all existing and future unsecured indebtedness of such
Guarantor that is not, by its terms, expressly subordinated in right of payment
to such Guarantee.
Covenant Providing for Limitation on Liens. Nothing in the Senior
Indenture or the Senior Debt Securities will in any way restrict or prevent the
Company or any Restricted Subsidiary from issuing, assuming, guaranteeing or
otherwise incurring any Indebtedness, provided, however, the Senior Indenture
will provide that the Company will not, and will not permit any Restricted
Subsidiary to, issue, assume or guarantee any Indebtedness for borrowed money
secured by any Lien on any property or asset now owned or hereafter acquired by
the Company or such Restricted Subsidiary without making effective provision
whereby any and all Senior Debt Securities then or thereafter outstanding will
be secured by a Lien equally and ratably with any and all other obligations
thereby secured for so long as any such obligations shall be so secured.
Notwithstanding the foregoing, the Company or any Restricted
Subsidiary may, without so securing the Senior Debt Securities, issue, assume
or guarantee Indebtedness secured by the following Liens:
(a) Liens existing on the date on which the Senior Debt
Securities are originally issued or provided for under the terms of
agreements existing on such date;
(b) Liens on property securing (i) all or any portion of
the cost of exploration, drilling or development of such property,
(ii) all or any portion of the cost of acquiring, constructing,
altering, improving or repairing any property or assets, real or
personal, or improvements used or to be used in connection with such
property or (iii) Indebtedness incurred by the Company or any
Restricted Subsidiary to provide funds for the activities set forth in
clauses (i) and (ii) above;
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(c) Liens securing Indebtedness owed by a Restricted
Subsidiary to the Company or to any other Restricted Subsidiary;
(d) Liens on the property of any Person existing at the
time such Person becomes a Subsidiary of the Company and not incurred
as a result of (or in connection with or in anticipation of) such
Person becoming a Subsidiary of the Company, provided that such Liens
do not extend to or cover any property or assets of the Company or any
of its Subsidiaries other than the property so acquired;
(e) Liens on any property securing (i) Indebtedness
incurred in connection with the construction, installation or
financing of pollution control or abatement facilities or other forms
of industrial revenue bond financing or (ii) Indebtedness issued or
guaranteed by the United States or any State thereof or any
department, agency or instrumentality of either;
(f) any Lien on any asset securing Non-Recourse
Indebtedness of the Company or any Restricted Subsidiary or on any
asset of Union Texas East Kalimantan Limited securing Joint Venture
Indebtedness;
(g) any Lien extending, renewing or replacing (or
successive extensions, renewals or replacements of) any Lien of any
type permitted under clauses (a) through (f) above, provided that such
Lien extends to or covers only the property that is subject to the
Lien being extended, renewed or replaced;
(h) certain Liens arising in the ordinary course of
business of the Company and the Restricted Subsidiaries; or
(i) Liens (exclusive of any Lien of any type otherwise
permitted under clauses (a) through (h) above) securing Indebtedness
of the Company or any Restricted Subsidiary in an aggregate principal
amount which, together with the aggregate amount of Attributable
Indebtedness deemed to be outstanding in respect of all Sale/Leaseback
Transactions entered into pursuant to clause (a) of the covenant
described under "Limitation on Sale/Leaseback Transactions" below
(exclusive of any such Sale/Leaseback Transactions otherwise permitted
under clauses (a) through (h) above), does not at the time such
Indebtedness is incurred exceed 10% of the Consolidated Net Worth of
the Company (as shown in the most recent audited consolidated balance
sheet of the Company and its Subsidiaries).
The following types of transactions will not be prohibited or
otherwise limited by the foregoing covenant: (i) the sale, granting of Liens
with respect to, or other transfer of, crude oil, natural gas or other
petroleum hydrocarbons in place for a period of time until, or in an amount
such that, the transferee will realize therefrom a specified amount (however
determined) of money or of such crude oil, natural gas or other petroleum
hydrocarbons; (ii) the sale or other transfer of any other interest in property
of the character commonly referred to as a production payment, overriding
royalty, forward sale or similar interest; and (iii) the granting of Liens
required by any contract or statute in order to permit the Company or any
Restricted Subsidiary to perform any contract or subcontract made by it with or
at the request of the United States or any State thereof or of any foreign
government or any department, agency, organization or instrumentality thereof,
or to secure partial, progress, advance or other payments to the Company or any
Restricted Subsidiary by such governmental unit pursuant to the provisions of
any contract or statute. (Section 1107 of the Senior Indenture)
Covenant Providing for Limitation on Sale/Leaseback Transactions. The
Senior Indenture will provide that the Company will not, and will not permit
any Restricted Subsidiary to, enter into any Sale/Leaseback Transaction with
any Person (other than the Company or a Restricted Subsidiary) unless:
(a) the Company or such Restricted Subsidiary would be
entitled to incur Indebtedness, in a principal amount equal to the
Attributable Indebtedness with respect to such Sale/Leaseback
Transaction, secured by a Lien on the property subject to such
Sale/Leaseback Transaction pursuant to the covenant described under
"Limitation on Liens" above without equally and ratably securing the
Senior Debt Securities pursuant to such covenant;
(b) after the date on which the Senior Debt Securities
are originally issued and within a period commencing six months prior
to the consummation of such Sale/Leaseback Transaction and ending six
months after the consummation thereof, the Company or such Restricted
Subsidiary shall have expended for property used or to be used in the
ordinary course of business of the Company and the Restricted
Subsidiaries (including amounts expended for the exploration, drilling
or development thereof, and for additions, alterations, repairs and
improvements thereto) an amount equal to all or a portion of the net
proceeds of such Sale/Leaseback
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Transaction and the Company shall have elected to designate such
amount as a credit against such Sale/Leaseback Transaction (with any
such amount not being so designated to be applied as set forth in
clause (c) below); or
(c) the Company, during the 12-month period after the
effective date of such Sale/Leaseback Transaction, shall have applied
to the voluntary defeasance or retirement of any Pari Passu
Indebtedness an amount equal to the greater of the net proceeds of the
sale or transfer of the property leased in such Sale/Leaseback
Transaction and the fair value, as determined by the Board of
Directors of the Company, of such property at the time of entering
into such Sale/Leaseback Transaction (in either case adjusted to
reflect the remaining term of the lease and any amount expended by the
Company as set forth in clause (b) above), less an amount equal to the
principal amount of Pari Passu Indebtedness voluntarily defeased or
retired by the Company within such 12-month period and not designated
as a credit against any other Sale/Leaseback Transaction entered into
by the Company or any Restricted Subsidiary during such period.
(Section 1106 of the Senior Indenture)
The term "Attributable Indebtedness," when used with respect to any
Sale/Leaseback Transaction, is defined in the Senior Indenture as at the time
of determination, the present value (discounted at a rate equivalent to the
Company's then current weighted average cost of funds for borrowed money as at
the time of determination, compounded on a semi-annual basis) of the total
obligations of the lessee for rental payments during the remaining term of the
lease included in such Sale/Leaseback Transaction (including any period for
which such lease has been extended).
The term "Capitalized Lease Obligation" of any Person is defined in
the Senior Indenture as any obligation of such Person to pay rent or other
amounts under a lease of property, real or personal, that is required to be
capitalized for financial reporting purposes in accordance with generally
accepted accounting principles; and the amount of such obligation shall be the
capitalized amount thereof determined in accordance with generally accepted
accounting principles.
The term "Consolidated Net Worth" of the Company is defined in the
Senior Indenture as the consolidated stockholder's equity of the Company and
its Subsidiaries, as determined in accordance with generally accepted
accounting principles.
The term "Funded Indebtedness" is defined in the Senior Indenture as
all Indebtedness (including Indebtedness incurred under any revolving credit,
letter of credit or working capital facility) that matures by its terms, or
that is renewable at the option of any obligor thereon to a date, more than one
year after the date on which such Indebtedness is originally incurred.
The term "Hedging Obligations" of any Person is defined in the Senior
Indenture as the obligations of such Person pursuant to any interest rate swap
agreement, foreign currency exchange agreement, interest rate collar agreement,
option or future contract or other similar agreement or arrangement relating to
interest rates or foreign exchange rates.
The term "Indebtedness" of any Person at any date is defined in the
Senior Indenture as, without duplication, (i) all indebtedness of such Person
for borrowed money (whether or not the recourse of the lender is to the whole
of the assets of such Person or only to a portion thereof), (ii) all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments, (iii) all obligations of such Person in respect of letters
of credit or other similar instruments (or reimbursement obligations with
respect thereto), other than standby letters of credit incurred by such Person
in the ordinary course of business, (iv) all obligations of such Person to pay
the deferred and unpaid purchase price of property or services, except trade
payables and accrued expenses incurred in the ordinary course of business, (v)
all Capitalized Lease Obligations of such Person, (vi) all Indebtedness of
others secured by a lien on any asset of such Person, whether or not such
Indebtedness is assumed by such Person, (vii) all Indebtedness of others
guaranteed by such Person to the extent of such guarantee and (viii) all
Hedging Obligations of such Person.
The term "Joint Venture Indebtedness" is defined in the Senior
Indenture as obligations secured by a Lien on the interests of the Company or a
Restricted Subsidiary, as the case may be, arising under production sharing
contracts or related supply contracts, if such Lien covers ratably the
interests of Pertamina, the Indonesian national oil company, and all production
sharing contractors thereunder.
The term "Lien" is defined in the Senior Indenture as, with respect to
any asset, any mortgage, lien, pledge, charge, security interest or encumbrance
of any kind in respect of such asset (including, without limitation, any
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production payment, advance payment or similar arrangement with respect to
minerals in place), whether or not filed, recorded or otherwise perfected under
applicable law. For the purposes of this Indenture, the Company or any
Subsidiary shall be deemed to own subject to a Lien any asset which it has
acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, Capitalized Lease Obligation (other than any
Capitalized Lease Obligation relating to any building, structure, equipment or
other property used or to be used in the ordinary course of business of the
Company and the Restricted Subsidiaries) or other title retention agreement
relating to such asset.
The term "Non-Recourse Indebtedness" is defined in the Senior
Indenture as, at any date, the aggregate amount at such date of Indebtedness of
the Company or a Subsidiary in respect of which the recourse of the holder of
such Indebtedness, whether direct or indirect and whether contingent or
otherwise, is effectively limited to specified assets.
The term "Pari Passu Indebtedness" is defined in the Senior Indenture
as any Indebtedness of the Company, whether outstanding on the Issue Date or
thereafter created, incurred or assumed, unless, in the case of any particular
Indebtedness, the instrument creating or evidencing the same or pursuant to
which the same is outstanding expressly provides that such Indebtedness shall
be subordinated in right of payment to the Securities.
The term "Restricted Subsidiary" is defined in the Senior Indenture as
(i) Union Texas East Kalimantan Limited, Union Texas Petroleum Energy
Corporation, Union Texas International Corporation, Union Texas Products
Corporation and Unistar, Inc., (ii) Union Texas Petroleum Limited so long as it
is a Subsidiary of the Company and (iii) any Subsidiary of the Company that is
a successor corporation of any Subsidiary of the Company referred to in clauses
(i) and (ii).
The term "Sale/Leaseback Transaction" is defined in the Senior
Indenture as any arrangement with any Person providing for the leasing by the
Company or any Restricted Subsidiary, for a period of more than three years, of
any real or tangible personal property, which property has been or is to be
sold or transferred by the Company or such Restricted Subsidiary to such Person
in contemplation of such leasing.
PROVISIONS APPLICABLE SOLELY TO SUBORDINATED DEBT SECURITIES
General. Subordinated Debt Securities will be issued under the
Subordinated Indenture and will rank pari passu with certain other subordinated
debt of the Company that may be outstanding from time to time and will rank
junior to all Senior Indebtedness (including any Senior Debt Securities) of the
Company that may be outstanding from time to time.
Subordination. The payment of the principal of (and premium, if any)
and interest on the Subordinated Debt Securities is expressly subordinated, to
the extent and in the manner set forth in the Subordinated Indenture, in right
of payment to the prior payment in full of all Senior Indebtedness of the
Company. (Section 1301 of the Subordinated Indenture)
In the event of any dissolution or winding up, or total or partial
liquidation or reorganization of the Company, whether in bankruptcy,
reorganization, insolvency, receivership or similar proceeding, the holders of
Senior Indebtedness will be entitled to receive payment in full of all amounts
due or to become due on or in respect of all Senior Indebtedness before the
holders of the Subordinated Debt Securities are entitled to receive any payment
on account of principal (or premium, if any) or interest on the Subordinated
Debt Securities. (Section 1302 of the Subordinated Indenture) By reason of
subordination of the Subordinated Debt Securities, in the event of the
insolvency of the Company, holders of the Subordinated Debt Securities may
recover less, ratably, than holders of Senior Indebtedness.
Unless otherwise indicated in the applicable Prospectus Supplement, no
payment in respect of the Subordinated Debt Securities shall be made if, at the
time of such payment, there exists a default in payment of all or any portion
of any Senior Indebtedness, and such default shall not have been cured or
waived in writing or the benefits of such subordination in the Subordinated
Indenture shall not have been waived in writing by or on behalf of the holders
of such Senior Indebtedness. In addition, unless otherwise provided in the
applicable Prospectus Supplement, during the continuance of any event of
default (other than a default referred to in the immediately preceding
sentence) with respect to any Senior Indebtedness permitting the holders to
accelerate the maturity thereof and upon written notice thereof given to the
Trustee, with a copy to the Company (the delivery of which shall not affect the
validity of the notice to the Trustee), by any holder of Senior Indebtedness or
its representative, then, unless and until such an event of default shall have
been cured or waived or shall have ceased to exist, no payment shall be made by
the Company with respect to the principal of or interest on the Subordinated
Debt Securities or to acquire any of the Subordinated Debt Securities or on
account of the redemption provisions of the Subordinated Debt Securities. Only
one such payment blockage period may
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be commenced within any consecutive 365-day period with respect to the
Subordinated Debt Securities. No event of default which existed or was
continuing on the date of the commencement of any 180-day payment blockage
period with respect to the Senior Indebtedness initiating such payment blockage
period shall be, or be made, the basis for the commencement of a second payment
blockage period by a holder or representative of such Senior Indebtedness,
whether or not within a period of 365 consecutive days, unless such event of
default shall have been cured or waived for a period of not less than 90
consecutive days (and, in the case of any such waiver, no payment shall be made
by the Company to the holders of Senior Indebtedness in connection with such
waiver other than amounts due pursuant to the terms of the Senior Indebtedness
as in effect at the time of such default). (Section 1302 of the Subordinated
Indenture)
The term "Indebtedness", as applied to any Person, is defined in the
Subordinated Indenture as all indebtedness, whether or not represented by
bonds, debentures, notes or other securities, created or assumed by such Person
for the repayment of money borrowed, and obligations, computed in accordance
with generally accepted accounting principles, as lessee under leases that
should be, in accordance with generally accepted accounting principles,
recorded as capital leases. All Indebtedness of others guaranteed as to payment
of principal by such Person or in effect guaranteed by such Person through a
contingent agreement to purchase such Indebtedness shall for all purposes
hereof be deemed to be Indebtedness of such Person.
The term "Senior Indebtedness" is defined in the Subordinated
Indenture as Indebtedness, either outstanding as of the date of the
Subordinated Indenture or issued subsequent to the date of the Subordinated
Indenture, unless such Indebtedness is either subordinated by its terms in
right of payment to any other Indebtedness of the Company or pari passu with
subordinated Indebtedness of any series, provided that the term "Senior
Indebtedness" shall not include (i) Indebtedness of the Company to any
Subsidiary for money borrowed or advanced from such Subsidiary or (ii) amounts
owed (except to banks and other financial institutions) for goods, materials or
services purchased in the ordinary course of business.
If Subordinated Debt Securities are issued under the Subordinated
Indenture, the aggregate principal amount of Senior Indebtedness outstanding as
of a recent date will be set forth in the applicable Prospectus Supplement. The
Subordinated Indenture does not restrict the amount of Senior Indebtedness that
the Company may incur.
DESCRIPTION OF CAPITAL STOCK
Under the Company's Restated Certificate of Incorporation as amended
(the "Charter"), the Company is authorized to issue 215,000,000 shares of
capital stock ("Capital Stock") consisting of 15,000,000 shares of Preferred
Stock and 200,000,000 shares of Common Stock. As of June 30, 1997, there were
84,687,098 shares of Common Stock outstanding and no shares of Preferred Stock
outstanding.
COMMON STOCK
Voting and other Rights. The Common Stock possesses ordinary voting
rights for the election of directors and in respect of other corporate matters,
each share being entitled to one vote. There are no cumulative voting rights,
meaning that the holders of a majority of the shares voting for the election of
directors can elect all the directors if they choose to do so. The Common
Stock carries no preemptive rights and is not convertible, redeemable or
assessable. Subject to the prior rights of any shares of Preferred Stock that
may from time to time be outstanding, the holders of Common Stock are entitled
to dividends in such amounts and at such times as may be declared by the Board
of Directors.
Upon liquidation or dissolution, holders of Common Stock are entitled
to share ratably in all net assets available for distribution to shareholders
after payment of preferential amounts to holders of Preferred Stock. All
outstanding shares of Common Stock are, and the shares of Common Stock to be
sold by the Company in connection with any offering pursuant to this Prospectus
and any Prospectus Supplement when issued will be, duly authorized, validly
issued, fully paid and nonassessable.
The outstanding Common Stock is listed on the New York Stock Exchange
and the Pacific Stock Exchange under the symbol "UTH." Any Common Stock
offered will be listed, subject to notice of issuance, on such exchanges.
The transfer agent, registrar and dividend disbursing agent for the
Common Stock is First Chicago Trust Company of New York.
SECTION 203 OF THE DELAWARE GENERAL CORPORATION LAW
Section 203 of the Delaware General Corporation Law ("DGCL") prevents
an "interested stockholder" (defined in Section 203, generally, as a person
owning 15% or more of a corporation's outstanding voting stock), from engaging
in a "business combination" (as defined in Section 203) with a publicly-held
Delaware corporation for three years following the date such person became an
interested stockholder unless (i) before such person became an interested
stockholder, the board of directors of the corporation approved the transaction
in which the interested stockholder became an interested stockholder or approved
the business combination; (ii) upon consummation of the transaction that
resulted in the interested stockholder becoming an interested stockholder, the
interested stockholder owned at least 85% of the voting stock of the corporation
outstanding at the time the transaction commenced (excluding stock held by
directors who are also officers of the corporation and by employee stock plans
that do not provide participants with the rights to determine confidentially
whether shares held subject to the plan will be tendered in a tender or exchange
offer); or (iii) following the transaction in which such person became an
interested stockholder, the business combination is approved by the board of
directors of the corporation and authorized at a meeting of stockholders by the
affirmative vote of the holders of two-thirds of the outstanding voting stock of
the corporation not owned by the interested stockholder. The provisions of
Section 203 may have the effect of delaying, deferring or preventing a change of
control of the Company.
DIRECTOR LIABILITY
The Charter contains a provision that limits the liability of the
Company's directors to the fullest extent permitted by the DGCL. The provision
eliminates the personal liability of directors to the Company and its
stockholders for monetary damages for breaches of their fiduciary duty of care.
As a result, stockholders may be unable to recover monetary damages against
directors for negligent or grossly negligent acts or omissions in violation of
their duty of care. The provision does not change the liability of a director
for breach of his duty of loyalty to the Company or to stockholders, for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, for the declaration or payment of dividends in
violation of Delaware law or in respect of any transaction from which a
director received an improper personal benefit. The Charter provides that if
the DGCL is amended to further limit such liability, then the liability of
Company directors will be limited or eliminated to the maximum extent permitted
by law as so amended.
PREFERRED STOCK
The Company is authorized to issue 15,000,000 shares of Preferred
Stock. Under the Charter, the Board of Directors may from time to time
establish and issue one or more series of Preferred Stock and fix the
designations, powers, preferences and rights of the shares of such series and
the qualifications, limitations or restrictions thereon, including, but not
limited to, dividend rights, dividend rates, conversion rights, voting rights,
rights and terms of redemption (including sinking fund provisions) and
liquidation preferences. The number of authorized shares of Preferred Stock
may be increased or decreased (but not below the number of shares thereof then
outstanding) by the affirmative vote of the holders of a majority of the voting
power of all of the then outstanding shares of the Capital Stock of the Company
entitled to vote generally in the election of directors (the "Voting Stock")
voting together as a single class, without a separate vote of the holders of
the Preferred Stock, or any series thereof, unless a vote of any such holders
is required pursuant to any certificate of designation relating to a series of
Preferred Stock.
The following description of the Preferred Stock sets forth certain
general terms and provisions of the Preferred Stock to which any Prospectus
Supplement may relate. Certain other terms of a particular series of Preferred
Stock will be described in the Prospectus Supplement relating to that series.
If so indicated in the Prospectus Supplement, the terms of any such series may
differ from the terms set forth below. The description of certain provisions
of the Preferred Stock set forth below and in any Prospectus Supplement does
not purport to be complete and is subject to and qualified in its entirety by
reference to the Company's Charter and bylaws and the certificate of
designation relating to each such series of Preferred Stock, which will be
filed with the Commission in connection with the offering of such series of
Preferred Stock.
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GENERAL
Subject to limitations prescribed by Delaware law and the Company's
Charter and bylaws, the Board of Directors is authorized to fix the number of
shares constituting each series of Preferred Stock and the designations,
relative rights, preferences and limitations thereof, including such provisions
as may be desired concerning voting, redemption, dividends, dissolution, the
distribution of assets, conversion or sinking funds, and such other subjects or
matters as may be fixed by resolution of the Board of Directors or a duly
authorized committee thereof. The Preferred Stock will, when issued, be fully
paid and nonassessable upon issuance against the full payment of the purchase
price therefor, and will not have, or be subject to, any preemptive or similar
rights.
Reference is made to the Prospectus Supplement relating to the series
of Preferred Stock offered thereby for specific terms, including: (i) the class
or series, title and stated value of such Preferred Stock; (ii) the number of
shares of such Preferred Stock offered, the liquidation preference per share
and the offering price of such Preferred Stock; (iii) the dividend rate(s),
period(s) and/or payment date(s) or method(s) of calculation thereof applicable
to such Preferred Stock; (iv) whether dividends on such Preferred Stock shall
be cumulative or not and, if cumulative, the date from which dividends on such
Preferred Stock shall accumulate; (v) the procedures for any auction and
remarketing, if any, for such Preferred Stock; (vi) provisions for a sinking
fund, if any, for such Preferred Stock; (vii) provisions for redemption, if
applicable, of such Preferred Stock; (viii) any listing of such Preferred Stock
on any securities exchange; (ix) the terms and conditions, if applicable, upon
which such Preferred Stock will be convertible into other securities of the
Company, including the conversion price (or manner of calculation thereof); (x)
whether interests in such Preferred Stock will be represented by Depositary
Shares; (xi) a discussion of certain federal income tax considerations
applicable to such Preferred Stock; and (xii) any other material terms,
preferences, rights, limitations or restrictions of such Preferred Stock.
RANK
Unless otherwise specified in the Prospectus Supplement, the Preferred
Stock will, with respect to (as applicable) dividend rights and rights upon
liquidation, dissolution or winding up of the Company, rank (i) senior to all
classes or series of common stock of the Company and to all equity securities
of the Company the terms of which provide that such equity securities are
subordinated to such Preferred Stock; (ii) on a parity with all equity
securities of the Company other than those referred to in clauses (i) and
(iii); and (iii) junior to all equity securities of the Company which the terms
of such Preferred Stock provide will rank senior to it. For these purposes,
the term "equity securities" does not include convertible debt securities.
DIVIDENDS
Holders of shares of the Preferred Stock of each series shall be
entitled to receive, when, as and if declared by the Board of Directors of the
Company, out of funds legally available therefor, cash dividends at such rates
and on such dates as will be set forth in the applicable Prospectus Supplement.
Different series of the Preferred Stock may be entitled to dividends at
different rates or based upon different methods of determination. Such rates
may be fixed or variable or both. Each such dividend shall be payable to
holders of record as they appear on the stock transfer books of the Company on
such record dates as shall be fixed by the Board of Directors of the Company or
a duly authorized committee thereof.
Dividends on any series of the Preferred Stock may be cumulative or
non-cumulative, as provided in the applicable Prospectus Supplement.
Dividends, if cumulative, will accumulate from and after the date set forth in
the applicable Prospectus Supplement. If the Board of Directors of the Company
fails to declare a dividend payable on a dividend payment date on any series of
the Preferred Stock for which dividends are noncumulative, then the holders of
such series of the Preferred Stock will have no right to receive a dividend in
respect of the dividend period ending on such dividend payment date, and the
Company will have no obligation to pay the dividend accrued for such period,
whether or not dividends on such series are declared payable on any future
dividend payment date.
If any shares of the Preferred Stock of any series are outstanding, no
full dividends shall be declared or paid or set apart for payment on any
capital stock of the Company ranking, as to dividends, on a parity with or
junior to the Preferred Stock of such series for any period, unless (i) if such
series of Preferred Stock has a cumulative dividend, full cumulative dividends
have been or contemporaneously are declared and paid or declared and a sum
sufficient for the
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payment thereof set apart for such payment on the Preferred Stock of such
series for all past dividend periods and the then current dividend period or
(ii) if such series of Preferred Stock does not have a cumulative dividend,
full dividends for the then current dividend period have been or
contemporaneously are declared and paid or declared and a sum sufficient for
the payment thereof set apart for such payment on the Preferred Stock of such
series. When dividends are not paid in full (or a sum sufficient for such full
payment is not so set apart) upon the shares of Preferred Stock of any series
and the shares of any other series of preferred stock ranking on a parity as to
dividends with the Preferred Stock of such series, all dividends declared upon
shares of Preferred Stock of such series and any other series of preferred
stock ranking on a parity as to dividends with such Preferred Stock shall be
declared pro rata so that the amount of dividends declared per share on the
Preferred Stock of such series and such other series of preferred stock shall
in all cases bear to each other the same ratio that accrued and unpaid
dividends per share on the shares of Preferred Stock of such series (which
shall not include any accumulation in respect of unpaid dividends for prior
dividend periods if such Preferred Stock does not have a cumulative dividend)
and such other series of preferred stock bear to each other. No interest, or
sum of money in lieu of interest, shall be payable in respect of any dividend
payment or payments on Preferred Stock of such series which may be in arrears.
Except as provided in the immediately preceding paragraph, unless (i)
if such series of Preferred Stock has a cumulative dividend, full cumulative
dividends on the Preferred Stock of such series have been or contemporaneously
are declared and paid or declared and a sum sufficient for the payment thereof
set apart for payment for all past dividend periods and the then current
dividend period and (ii) if such series of Preferred Stock does not have a
cumulative dividend, full dividends on the Preferred Stock of such series have
been or contemporaneously are declared and paid or declared and a sum
sufficient for the payment thereof set aside for payment for the then current
dividend period, no dividends (other than in shares of Common Stock or other
capital stock ranking junior to the Preferred Stock of such series as to
dividends and upon liquidation, dissolution or winding up) shall be declared or
paid or set aside for payment or other distribution shall be declared or made
upon the Common Stock, or any other capital stock of the Company ranking junior
to or on a parity with the Preferred Stock of such series as to dividends or
upon liquidation, nor shall any shares of Common Stock, or any other capital
stock of the Company ranking junior to or on a parity with the Preferred Stock
of such series as to dividends or upon liquidation, dissolution or winding up
be redeemed, purchased or otherwise acquired for any consideration (or any
moneys be paid to or made available for a sinking fund for the redemption of
any such shares) by the Company (except by conversion into or exchange for
other capital stock of the Company ranking junior to the Preferred Stock of
such series as to dividends and upon liquidation, dissolution or winding up).
REDEMPTION
The terms, if any, on which shares of a series Preferred Stock may be
subject to mandatory redemption or redemption at the option of the Company, in
whole or in part, will be set forth in the Prospectus Supplement relating to
such series.
RIGHTS UPON LIQUIDATION
Upon any voluntary or involuntary liquidation, dissolution or winding
up of the Company, then, before any distribution or payment shall be made to
the holders of any Common Stock, or any other series of capital stock of the
Company ranking junior to such series of Preferred Stock upon liquidation,
dissolution or winding up, the holders of each series of Preferred Stock shall
be entitled to receive out of assets of the Company legally available for
distribution to stockholders liquidating distributions in the amount of the
liquidation preference per share (set forth in the applicable Prospectus
Supplement), plus an amount equal to all accrued and unpaid dividends for the
then current dividend period and, if such series of the Preferred Stock is
cumulative, for all dividend periods prior thereto, all as set forth in the
Prospectus Supplement with respect to such shares.
VOTING RIGHTS
Holders of a series of Preferred Stock will not have any voting
rights, except as from time to time required by law or as indicated in the
applicable Prospectus Supplement; provided, that the holders of shares of any
series of Preferred Stock will not be entitled to more than one vote per share,
when voting as a class with the holders of shares of the Common Stock and if
such Preferred Stock is convertible into Common Stock, then holders can receive
one vote on an as converted basis.
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<PAGE> 20
CONVERSION RIGHTS
The terms and conditions, if any, upon which shares of any series of
Preferred Stock are convertible into Common Stock, Debt Securities or another
series of Preferred Stock will be set forth in the applicable Prospectus
Supplement relating thereto. Such terms will include the number of shares of
Common Stock or such other series of Preferred Stock or the principal amount of
Debt Securities into which the Preferred Stock is convertible, the conversion
price (or manner of calculation thereof), the conversion period, provisions as
to whether conversion will be at the option of the holders of such series of
Preferred Stock or the Company, the events requiring an adjustment of the
conversion price and provisions affecting conversion in the event of the
redemption of such series of Preferred Stock.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for the Preferred Stock will be set
forth in the applicable Prospectus Supplement.
DESCRIPTION OF DEPOSITARY SHARES
GENERAL
The Company may issue Depositary Shares, each of which will represent
a fractional interest of a share of a particular series of Preferred Stock, as
specified in the applicable Prospectus Supplement. Shares of a series of
Preferred Stock represented by Depositary Shares will be deposited under a
separate Deposit Agreement (each, a "Deposit Agreement") among the Company, the
depositary named therein (the "Preferred Stock Depositary") and the holders
from time to time of the depositary receipts issued by the Preferred Stock
Depositary which will evidence the Depositary Shares ("Depositary Receipts").
Subject to the terms of the Deposit Agreement, each owner of a Depositary
Receipt will be entitled, in proportion to the fractional interest of a share
of a particular series of Preferred Stock represented by the Depositary Shares
evidenced by such Depositary Receipt, to all the rights and preferences of the
series of Preferred Stock represented by such Depositary Shares (including
dividend, voting, conversion, redemption and liquidation rights).
The Depositary Shares will be evidenced by Depositary Receipts issued
pursuant to the applicable Deposit Agreement. Immediately following the
issuance and delivery of a series of Preferred Stock by the Company to the
Preferred Stock Depositary, the Company will cause the Preferred Stock
Depositary to issue, on behalf of the Company, the Depositary Receipts. Copies
of the applicable form of Deposit Agreement and Depositary Receipt may be
obtained from the Company upon request. The statements made hereunder relating
to the Deposit Agreement and the Depositary Receipts to be issued thereunder
are summaries of certain provisions thereof and do not purport to be complete
and are subject to, and qualified in their entirety by reference to, all of the
provisions of the applicable Deposit Agreement and related Depositary Receipts.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Preferred Stock Depositary will distribute all cash dividends or
other cash distributions received in respect of a series of Preferred Stock to
the record holders of Depositary Receipts evidencing the related Depositary
Shares in proportion to the number of such Depositary Receipts owned by such
holders, subject to certain obligations of holders to file proofs, certificates
and other information and to pay certain charges and expenses to the Preferred
Stock Depositary.
In the event of a distribution other than in cash, the Preferred Stock
Depositary will distribute property received by it to the record holders of
Depositary Receipts entitled thereto, subject to certain obligations of holders
to file proofs, certificates and other information and to pay certain charges
and expenses to the Preferred Stock Depositary, unless the Preferred Stock
Depositary determines that it is not feasible to make such distribution, in
which case the Preferred Stock Depositary may, with the approval of the
Company, sell such property and distribute the net proceeds from such sale to
such holders.
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<PAGE> 21
WITHDRAWAL OF PREFERRED STOCK
Upon surrender of the Depositary Receipts at the corporate trust
office of the Preferred Stock Depositary (unless the related Depositary Shares
have previously been called for redemption), the holders thereof will be
entitled to delivery at such office, to or upon such holder's order, of the
number of whole or fractional shares of the series of Preferred Stock and any
money or other property represented by the Depositary Shares evidenced by such
Depositary Receipts. Holders of Depositary Receipts will be entitled to
receive whole or fractional shares of the related series of Preferred Stock on
the basis of the proportion of Preferred Stock represented by each Depositary
Share as specified in the applicable Prospectus Supplement, but holders of such
shares of Preferred Stock will not thereafter be entitled to receive Depositary
Shares therefor. If the Depositary Receipts delivered by the holder evidence a
number of Depositary Shares in excess of the number of Depositary Shares
representing the number of shares of Preferred Stock to be withdrawn, the
Preferred Stock Depositary will deliver to such holder at the same time a new
Depositary Receipt evidencing such excess number of Depositary Shares.
REDEMPTION
Whenever the Company redeems shares of a series of Preferred Stock
held by the Preferred Stock Depositary, the Preferred Stock Depositary will
redeem as of the same redemption date the number of Depositary Shares
representing shares of such series of Preferred Stock so redeemed, provided the
Company shall have paid in full to the Preferred Stock Depositary the
redemption price of the Preferred Stock to be redeemed plus an amount equal to
any accrued and unpaid dividends thereon to the date fixed for redemption. The
redemption price per Depositary Share will be equal to the corresponding
proportion of the redemption price and any other amounts per share payable with
respect to such series of Preferred Stock. If fewer than all the Depositary
Shares are to be redeemed, the Depositary Shares to be redeemed will be
selected pro rata (as nearly as may be practicable without creating fractional
Depositary Shares) or by any other equitable method determined by the Company.
From and after the date fixed for redemption, all dividends in respect of the
shares of a series of Preferred Stock so called for redemption will cease to
accrue, the Depositary Shares so called for redemption will no longer be deemed
to be outstanding and all rights of the holders of the Depositary Receipts
evidencing the Depositary Shares so called for redemption will cease, except
the right to receive any moneys payable upon such redemption and any money or
other property to which the holders of such Depositary Receipts were entitled
upon such redemption and surrender thereof to the Preferred Stock Depositary.
VOTING
Upon receipt of notice of any meeting at which the holders of a series
of Preferred Stock deposited with the Preferred Stock Depositary are entitled
to vote, the Preferred Stock Depositary will mail the information contained in
such notice of meeting to the record holders of the Depositary Receipts
evidencing the Depositary Shares which represent such series of Preferred
Stock. Each record holder of Depositary Receipts evidencing Depositary Shares
on the record date (which will be the same date as the record date for such
series of Preferred Stock) will be entitled to instruct the Preferred Stock
Depositary as to the exercise of the voting rights pertaining to the amount of
Preferred Stock represented by such holder's Depositary Shares. The Preferred
Stock Depositary will vote the amount of such series of Preferred Stock
represented by such Depositary Shares in accordance with such instructions, and
the Company will agree to take all reasonable action which may be deemed
necessary by the Preferred Stock Depositary in order to enable the Preferred
Stock Depositary to do so. The Preferred Stock Depositary will abstain from
voting the amount of such series of Preferred Stock represented by such
Depositary Shares to the extent it does not receive specific instructions from
the holders of Depositary Receipts evidencing such Depositary Shares. The
Preferred Stock Depositary shall not be responsible for any failure to carry
out any instruction to vote, or for the manner or effect of any such vote made,
as long as any such action or non-action is in good faith and does not result
from negligence or wilful misconduct of the Preferred Stock Depositary.
LIQUIDATION PREFERENCE
In the event of the liquidation, dissolution or winding up of the
Company, whether voluntary or involuntary, the holders of each Depositary
Receipt will be entitled to the fraction of the liquidation preference accorded
each share of Preferred Stock represented by the Depositary Shares evidenced by
such Depositary Receipt, as set forth in the applicable Prospectus Supplement.
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<PAGE> 22
CONVERSION
The Depositary Shares, as such, are not convertible into Common Stock
or any other securities or property of the Company. Nevertheless, if so
specified in the applicable Prospectus Supplement relating to an offering of
Depositary Shares, the Depositary Receipts may be surrendered by holders
thereof to the Preferred Stock Depositary with written instructions to the
Preferred Stock Depositary to instruct the Company to cause conversion of a
series of Preferred Stock represented by the Depositary Shares evidenced by
such Depositary Receipts into whole shares of Common Stock, other shares of
Preferred Stock or other shares of capital stock of the Company, and the
Company has agreed that upon receipt of such instructions and any amounts
payable in respect thereof, it will cause the conversion thereof utilizing the
same procedures as those provided for delivery of Preferred Stock to effect
such conversion. If the Depositary Shares evidenced by a Depositary Receipt
are to be converted in part only, a new Depositary Receipt or Receipts will be
issued for any Depositary Shares not to be converted. No fractional shares of
Common Stock will be issued upon conversion, and if such conversion would
result in a fractional share being issued, an amount will be paid in cash by
the Company equal to the value of the fractional interest based upon the
closing price of the Common Stock on the last business day prior to the
conversion.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares which
represent the Preferred Stock and any provision of the Deposit Agreement may at
any time be amended by agreement between the Company and the Preferred Stock
Depositary. However, any amendment that materially and adversely alters the
rights of the holders of Depositary Receipts or that would be materially and
adversely inconsistent with the rights granted to the holders of the related
series of Preferred Stock will not be effective unless such amendment has been
approved by the existing holders of at least two thirds of the Depositary
Shares evidenced by the Depositary Receipts then outstanding. No amendment
shall impair the right, subject to certain exceptions in the Deposit Agreement,
of any holder of Depositary Receipts to surrender any Depositary Receipt with
instructions to deliver to the holder the related series of Preferred Stock and
all money and other property, if any, represented thereby, except in order to
comply with law. Every holder of an outstanding Depositary Receipt at the time
any such amendment becomes effective shall be deemed, by continuing to hold
such Receipt, to consent and agree to such amendment and to be bound by the
Deposit Agreement as amended thereby.
The Deposit Agreement may be terminated by the Company upon not less
than 30 days' prior written notice to the Preferred Stock Depositary if a
majority of each series of Preferred Stock subject to such Deposit Agreement
consents to such termination, whereupon the Preferred Stock Depositary shall
deliver or make available to each holder of Depositary Receipts, upon surrender
of the Depositary Receipts held by such holder, such number of whole or
fractional shares of each such series of Preferred Stock as are represented by
the Depositary Shares evidenced by such Depositary Receipts together with any
other property held by the Preferred Stock Depositary with respect to such
Depositary Receipts. In addition, the Deposit Agreement will automatically
terminate if (i) all outstanding Depositary Shares issued thereunder shall have
been redeemed, (ii) there shall have been a final distribution in respect of
each series of Preferred Stock subject to such Deposit Agreement in connection
with any liquidation, dissolution or winding up of the Company and such
distribution shall have been distributed to the holders of Depositary Receipts
evidencing the Depositary Shares representing such series of Preferred Stock or
(iii) each share of Preferred Stock subject to such Deposit Agreement shall
have been converted into capital stock of the Company not so represented by
Depositary Shares.
CHARGES OF PREFERRED STOCK DEPOSITARY
The Company will pay all transfer and other taxes and governmental
charges arising solely from the existence of the Deposit Agreement. In
addition, the Company will pay the fees and expenses of the Preferred Stock
Depositary in connection with the performance of its duties under the Deposit
Agreement. However, holders of Depositary Receipts will pay certain transfer
and other taxes and governmental charges, as well as the fees and expenses of
the Preferred Stock Depositary for any duties requested by such holders to be
performed which are outside of those expressly provided for in the Deposit
Agreement.
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<PAGE> 23
RESIGNATION AND REMOVAL OF PREFERRED STOCK DEPOSITARY
The Preferred Stock Depositary may resign at any time by delivering to
the Company notice of its election to do so, and the Company may at any time
remove the Preferred Stock Depositary, any such resignation or removal to take
effect upon the appointment of a successor Preferred Stock Depositary. A
successor Preferred Stock Depositary must be appointed within 60 days after
delivery of the notice of resignation or removal and must be a bank or trust
company having its principal office in the United States and having a combined
capital and surplus of at least $50,000,000.
MISCELLANEOUS
The Preferred Stock Depositary will forward to holders of Depositary
Receipts any reports and communications from the Company which are received by
the Preferred Stock Depositary with respect to the related Preferred Stock.
Neither the Preferred Stock Depositary nor the Company will be liable
if it is prevented from or delayed in, by law or any circumstances beyond its
control, performing its obligations under the Deposit Agreement. The
obligations of the Company and the Preferred Stock Depositary under the Deposit
Agreement will be limited to performing their duties thereunder in good faith
and without negligence (in the case of any action or inaction in the voting of
a series of Preferred Stock represented by the Depositary Shares), gross
negligence or willful misconduct, and the Company and the Preferred Stock
Depositary will not be obligated to prosecute or defend any legal proceeding in
respect of any Depositary Receipts, Depositary Shares or shares of a series of
Preferred Stock represented thereby unless satisfactory indemnity is furnished.
The Company and the Preferred Stock Depositary may rely on written advice of
counsel or accountants, or information provided by persons presenting shares of
a series of Preferred Stock represented thereby for deposit, holders of
Depositary Receipts or other persons believed in good faith to be competent to
give such information, and on documents believed in good faith to be genuine
and signed by a proper party.
In the event the Preferred Stock Depositary shall receive conflicting
claims, requests or instructions from any holders of Depositary Receipts, on
the one hand, and the Company, on the other hand, the Preferred Stock
Depositary shall be entitled to act on such claims, requests or instructions
received from the Company.
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<PAGE> 24
DESCRIPTION OF WARRANTS
The Company may issue Warrants for the purchase of Debt Securities,
Preferred Stock and Common Stock. Warrants may be issued independently or
together with Debt Securities, Preferred Stock or Common Stock offered by any
Prospectus Supplement and may be attached to or separate from such Debt
Securities, Preferred Stock or Common Stock. Each series of Warrants will be
issued under a separate warrant agreement (a "Warrant Agreement") to be entered
into between the Company and a bank or trust company, as Warrant Agent (the
"Warrant Agent"), all as set forth in the Prospectus Supplement relating to the
particular issue of offered Warrants. The Warrant Agent will act solely as an
agent of the Company in connection with the Warrant certificates relating to
the Warrants and will not assume any obligation or relationship of agency or
trust for or with any holders of Warrant certificates or beneficial owners of
Warrants. The following summaries of certain provisions of the Warrant
Agreements and Warrants do not purport to be complete and are subject to, and
are qualified in their entirety by reference to, all the provisions of the
Warrant Agreement and the Warrant certificates relating to each series of
Warrants which will be filed with the Commission and incorporated by reference
as an exhibit to the Registration Statement of which this Prospectus is a part
at or prior to the time of the issuance of such series of Warrants.
GENERAL
If Warrants are offered, the applicable Prospectus Supplement will
describe the terms of such Warrants, including, in the case of Warrants for the
purchase of Debt Securities, the following where applicable: (i) the offering
price; (ii) the denominations and terms of the series of Debt Securities
purchasable upon exercise of such Warrants and whether such Debt Securities are
Senior Debt Securities or Subordinated Debt Securities; (iii) the designation
and terms of any series of Debt Securities with which such Warrants are being
offered and the number of such Warrants being offered with each such Debt
Security; (iv) the date, if any, on and after which such Warrants and any
related series of Debt Securities will be transferable separately; (v) the
principal amount of the series of Debt Securities purchasable upon exercise of
each such Warrant and the price at which such principal amount of Debt
Securities of such series may be purchased upon such exercise; (vi) the date on
which the right to exercise such Warrants shall commence and the date (the
"Expiration Date") on which such right shall expire; (vii) whether the Warrants
will be issued in registered or bearer form; (viii) any special United States
Federal income tax consequences; (ix) the terms, if any, on which the Company
may accelerate the date by which the Warrants must be exercised; and (x) any
other terms of such Warrants.
In the case of Warrants for the purchase of Preferred Stock or Common
Stock, the applicable Prospectus Supplement will describe the terms of such
Warrants, including the following where applicable: (i) the offering price;
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<PAGE> 25
(ii) the aggregate number of shares purchasable upon exercise of such Warrants
and the exercise price; (iii) the designation and terms of the series of
Preferred Stock or Common Stock with which such Warrants are being offered, if
any, and the number of such Warrants being offered with each such Preferred
Stock or Common Stock; (iv) the date, if any, on and after which such Warrants
and any related series of Preferred Stock or Common Stock will be transferable
separately; (v) the date on which the right to exercise such Warrants shall
commence and the Expiration Date; (vi) any special United States Federal income
tax consequences; (vii) the terms, if any, on which the Company may accelerate
the date by which the Warrants must be exercised; and (viii) any other terms of
such Warrants.
Warrant certificates may be exchanged for new Warrant certificates of
different denominations, may (if in registered form) be presented for
registration of transfer, and may be exercised at the corporate trust office of
the applicable Warrant Agent or any other office indicated in the applicable
Prospectus Supplement. Prior to the exercise of any Warrant to purchase Debt
Securities, holders of such Warrants will not have any of the rights of holders
of the Debt Securities purchasable upon such exercise, including the right to
receive payments of principal, premium, if any, or interest, if any, on such
Debt Securities or to enforce covenants in the applicable Indenture. Prior to
the exercise of any Warrants to purchase Preferred Stock or Common Stock,
holders of such Warrants will not have any rights of holders of such Preferred
Stock or Common Stock, including the right to receive payments of dividends, if
any, on such Capital Stock, or to exercise any applicable right to vote.
EXERCISE OF WARRANTS
Each Warrant will entitle the holder thereof to purchase such
principal amount of Debt Securities or number of shares of Preferred Stock or
Common Stock, as the case may be, at such exercise price as shall in each case
be set forth in, or calculable from, the Prospectus Supplement relating to the
offered Warrants. After the close of business on the Expiration Date (or such
later date to which such Expiration Date may be extended by the Company),
unexercised Warrants will become void.
Warrants may be exercised by delivering to the applicable Warrant
Agent payment as provided in the applicable Prospectus Supplement of the amount
required to purchase the Debt Securities, Preferred Stock or Common Stock, as
the case may be, purchasable upon such exercise together with certain
information set forth on the reverse side of the Warrant certificate. Warrants
will be deemed to have been exercised upon receipt of payment of the exercise
price in cash or by certified or official bank check, subject to the receipt
within five (5) business days of the Warrant certificate evidencing such
Warrants. Upon receipt of such payment at the corporate trust office of the
applicable Warrant Agent or any other office indicated in the applicable
Prospectus Supplement, the Company will, as soon as practicable, issue and
deliver the Debt Securities, Preferred Stock or Common Stock, as the case may
be, purchasable upon such exercise. If fewer than all of the Warrants
represented by such Warrant certificate are exercised, a new Warrant
certificate will be issued for the remaining amount of Warrants.
AMENDMENTS AND SUPPLEMENTS TO WARRANT AGREEMENTS
The Warrant Agreements may be amended or supplemented without the
consent of the holders of the Warrants issued thereunder to effect changes that
are not inconsistent with the provisions of the Warrants and that do not
adversely affect the interests of the holders of the applicable Warrants.
WARRANT ADJUSTMENTS
The applicable Prospectus Supplement will specify the manner, if any,
in which the exercise price of, and the number or amount of securities covered
by, a Warrant for Preferred Stock or Common Stock is subject to adjustment in
certain circumstances.
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<PAGE> 26
PLAN OF DISTRIBUTION
The Company may sell the Securities in and/or outside the United
States: (i) through underwriters; (ii) through dealers acting as principal or
as agent; (iii) directly to a limited number of purchasers or to a single
purchaser; or (iv) through agents. The applicable Prospectus Supplement with
respect to the any offering of Securities will set forth the terms of the
offering of the Securities, including the name or names of any underwriters,
dealers or agents, the purchase price of the Securities and the proceeds to the
Company from such sale, any delayed delivery arrangements, any discounts or
commissions and other items constituting compensation allowed or paid to any
underwriters, dealers or agents, any aggregate initial public offering price
and any discounts or concessions allowed or reallowed or paid to dealers. Any
aggregate initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers may be changed from time to time.
If underwriters are used in the sale, the Securities will be acquired
by the underwriters for their own account and may be resold from time to time
in one or more transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time of sale. The
Securities may be offered to the public either through underwriting syndicates
represented by one or more managing underwriters or directly by one or more
firms acting as underwriters. The underwriter or underwriters with respect to a
particular underwritten offering of Securities will be named in the Prospectus
Supplement relating to such offering and, if an underwriting syndicate is used,
the managing underwriter or underwriters will be set forth on the cover of such
Prospectus Supplement. Unless otherwise set forth in the Prospectus Supplement
relating thereto, the obligations of the underwriters to purchase the
Securities will be subject to conditions precedent, and the underwriters will
be obligated to purchase all the Securities if any are purchased.
If dealers are utilized in the sale of Securities in respect of which
this Prospectus is delivered, the Company will sell such Securities to the
dealers acting as principals or agents. The dealers may then resell such
Securities to the public at varying prices to be determined by such dealers at
the time of resale. The terms of the transaction will be set forth in the
Prospectus Supplement relating thereto to the extent required by the Securities
Act.
The Securities may be sold directly by the Company or through agents
designated by the Company from time to time. Any agent involved in the offer or
sale of the Securities in respect to which this Prospectus is delivered will be
named, and any commissions payable by the Company to such agent will be set
forth, in the Prospectus Supplement relating thereto to the extent required by
the Securities Act. Unless otherwise indicated in the Prospectus Supplement,
any such agent will be acting on a reasonable best efforts basis for the period
of its appointment.
The Securities may be sold directly by the Company to institutional
investors or others, who may be deemed to be underwriters within the meaning of
the Securities Act with respect to any resale thereof. The terms of any such
sales, including the terms of any bidding or auction process, will be described
in the Prospectus Supplement relating thereto.
If so indicated in the applicable Prospectus Supplement, the Company
will authorize agents, underwriters or dealers to solicit offers from certain
types of institutions to purchase Securities from the Company at the public
offering price set forth in the Prospectus Supplement pursuant to delayed
delivery contracts providing for payment and delivery on a specified date in
the future. Such contracts will be subject only to those conditions set forth
in the applicable Prospectus Supplement, and the Prospectus Supplement will set
forth the commission payable for solicitation of such contracts.
Agents, dealers and underwriters may be entitled under agreements
entered into with the Company to indemnification by the Company against certain
civil liabilities, including liabilities under the Securities Act, or to
contribution with respect to payments which such agents, dealers or
underwriters may be required to make in respect thereof. Agents, dealers and
underwriters may be customers of, engage in transactions with, or perform
services for the Company in the ordinary course of business or otherwise.
Each series of Securities, other than the Common Stock, will be a new
issue with no established trading market. The Common Stock is listed on the
New York Stock Exchange and the Pacific Stock Exchange. Any Common Stock sold
pursuant to a Prospectus Supplement will be listed on such exchanges, subject
to official notice of issuance. The Company may elect to list any series of
Debt Securities, Preferred Stock, Depositary Shares or Warrants on an exchange,
but is not obligated to do so. If so indicated in the applicable Prospectus
Supplement, any underwriters or agents to or through whom Securities are sold
by the Company may make a market in such Securities, but such underwriters or
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<PAGE> 27
agents will not be obligated to do so and may discontinue any market making at
any time without notice. No assurance can be given as to the liquidity of the
trading market for any Securities.
LEGAL MATTERS
The validity of the Securities is being passed upon for the Company by
King & Spalding, Houston, Texas, and, unless otherwise indicated in the
applicable Prospectus Supplement, for the underwriters, dealers or other agents
by Simpson Thacher & Bartlett (a partnership which includes professional
corporations), New York, New York.
EXPERTS
The financial statements incorporated in this Prospectus by reference
to the Annual Report on Form 10-K of Union Texas Petroleum Holdings, Inc. for
the year ended December 31, 1996, have been so incorporated in reliance on the
report of Price Waterhouse LLP, independent accountants, given on the authority
of said firm as experts in auditing and accounting.
With respect to the unaudited consolidated financial information of
Union Texas Petroleum Holdings, Inc. for the three-month periods ended March
31, 1997 and 1996 incorporated by reference in this Prospectus, Price
Waterhouse LLP reported that they have applied limited procedures in accordance
with professional standards for a review of such information. However, their
separate report dated April 22, 1997 incorporated by reference herein, states
that they did not audit and they do not express an opinion on that unaudited
consolidated financial information. Price Waterhouse LLP has not carried out
any significant or additional audit tests beyond those which would have been
necessary if their report had not been included. Accordingly, the degree of
reliance on their report on such information should be restricted in light of
the limited nature of the review procedures applied. Price Waterhouse LLP is
not subject to the liability provisions of section 11 of the Securities Act of
1933 for their report on the unaudited consolidated financial information
because this report is not a "report" or a "part" of the registration
statement prepared or certified by Price Waterhouse LLP within the meaning of
sections 7 and 11 of the Act.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
An itemized statement of the estimated amount of all expenses in
connection with the distribution of the securities registered hereby, all of
which will be paid by the Company, is as follows:
<TABLE>
<S> <C>
Registration fee . . . . . . . . . . . . . . . . $ 151,516
Blue Sky fees and expenses . . . . . . . . . . . 7,500
Printing and engraving expenses . . . . . . . . 40,000
Legal fees and expenses . . . . . . . . . . . . 100,000
Accounting fees and expenses . . . . . . . . . . 75,000
Rating agencies' fees and expenses . . . . . . . 180,000
Trustee's and registrar's fees . . . . . . . . . 5,000
Miscellaneous fees and expenses . . . . . . . . 15,984
---------
Total . . . . . . . . . . . . . . . . . . . $ 575,000
=========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law ("DGCL"), inter
alia, empowers a Delaware corporation to indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding (other than an action by or in the right
of the corporation) by reason of the fact that such person is or was a
director, officer, employee or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer, employee or agent of
another corporation, or is or was serving at the request of the corporation as
a director, officer, employee or agent of another corporation or other
enterprise, against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding if he acted in good faith and
in a manner he reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful.
Similar indemnity is authorized for such persons against expenses (including
attorneys' fees) actually and reasonably incurred in connection with the
defense or settlement of any such threatened, pending or completed action or
suit if such person acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the corporation, and provided
further that (unless a court of competent jurisdiction otherwise provides) such
person shall not have been adjudged liable to the corporation. Any such
indemnification may be made only as authorized in each specific case upon a
determination by the stockholders or disinterested directors or by independent
legal counsel in a written opinion that indemnification is proper because the
indemnitee has met the applicable standard of conduct.
Section 145 further authorizes a corporation to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee
or agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation or
enterprise, against any liability asserted against him and incurred by him in
any such capacity, or arising out of his status as such, whether or not the
corporation would otherwise have the power to indemnify him under Section 145.
The Company maintains policies insuring its and its subsidiaries officers and
directors against certain liabilities for actions taken in such capacities,
including liabilities under the Securities Act of 1933, as amended (the
"Securities Act").
Article VI of the Bylaws of the Company provides for indemnification
of the directors and officers of the Company to the full extent permitted by
law, as not in effect or later amended. In addition, the Bylaws provide for
indemnification against expenses incurred by a director or officer to be paid
by the Company at reasonable intervals in advance of the final disposition of
such action, suit or proceeding upon receipt of an undertaking by or on behalf
of the director or officer to repay such amount if it shall be ultimately
determined that he is not entitled to be indemnified by the Company. The
Bylaws further provide for a contractual cause of action on the part of
directors and officers of the Company for indemnification claims that have not
been paid by the Company.
The Company also has provided liability insurance for each director
and officer for certain losses arising from claims or charges made against them
while acting in their capacities as directors or officers of the Company.
Article VII of the Company's Restated Certificate of Incorporation, as
amended, limits under certain circumstances the liability of the Company's
directors for a breach of their fiduciary duty as directors. These provisions
II-1
<PAGE> 29
do not eliminate the liability of a director (i) for a breach of the director's
duty of loyalty to the Company or its stockholders, (ii) for acts or omissions
not in good faith or that involve intentional misconduct or a knowing violation
of law, (iii) under Section 174 of the DGCL (relating to the declaration of
dividends and purchase or redemption of shares in violation of the DGCL) or
(iv) for any transaction from which the director derived an improper personal
benefit.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
Exhibit No. Description of Exhibit
----------- ----------------------
<S> <C> <C>
**1.1 -- Form of Underwriting Agreement between the Company and the Underwriter(s) with respect to the
Securities.
**1.2 -- Form of Agency Agreement.
**1.3 -- Form of Distribution Agreement.
4.1 -- Indenture dated as of March 15, 1995, among the Company, certain subsidiaries named therein and
The First National Bank of Chicago, as trustee (the "1995 Indenture"), with respect to Senior
Debt Securities (Filed as Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1995 (Commission File No. 1-9019) and incorporated herein by
reference).
4.2 -- Form of Indenture between the Company and The First National Bank of Chicago, as trustee, with
respect to Subordinated Debt Securities (Filed as Exhibit 4.2 to the Company's Registration
Statement No. 33-64049 on Form S-3, as amended).
4.3 -- Indenture for 8.25% Senior Notes due November 15, 1999, dated as of November 15, 1992, between
the Company., certain subsidiaries named therein and State Street Bank and Trust Company
(including form of note) (Filed as Exhibit 10.1 to the Company's Form 10-Q for quarter ended
March 31, 1994 (Commission File No. 1-9019) and incorporated herein by reference).
4.4 -- Specimen Form of 8 3/8% Senior Note due March 15, 2005, issued by the Company pursuant to the
1995 Indenture (Filed as Exhibit 10.2 to the Company's Form 10-Q for quarter ended March 31,
1995 (Commission File No. 1-9019) and incorporated herein by reference).
4.5 -- Specimen Form of 8 1/2% Senior Note due April 15, 2007, issued by the Company pursuant to the
1995 Indenture (Filed as Exhibit 10.3 to the Company's Form 10-Q for quarter ended March 31,
1995 (Commission File No. 1-9019) and incorporated herein by reference).
4.6 -- Supplement dated November 7, 1995 to Indenture dated as of November 15, 1992 for 8.25% Senior
Notes due 1999, between the Company, certain subsidiaries named therein and State Street Bank
and Trust Company (Filed as Exhibit 4.1 to the Company's Form 8-K dated November 17, 1995
(Commission File No. 1-9019) and incorporated herein by reference).
4.7 -- Supplement dated November 7, 1995 to the 1995 Indenture between the Company, the Subsidiaries
named therein and The First National Bank of Chicago (Filed as Exhibit 4.2 to the Company's
Form 8-K dated November 17, 1995 (Commission File No. 1-9019) and incorporated herein by
reference).
4.8 -- Form of Fixed Rate Medium-Term Note issued by the Company pursuant to the 1995 Indenture (Filed
as Exhibit 4.4 to the Company's Registration Statement No. 33-64049 and incorporated herein by
reference). The Company agrees to furnish to the Commission upon request a copy of each
instrument with respect to issues of such notes of the Company, the authorized principal amount
of which does not exceed 10% of the consolidated assets of the Company and its subsidiaries.
**4.9 -- Form of Designating Amendment for Preferred Stock.
**4.10 -- Form of Deposit Agreement.
</TABLE>
II-2
<PAGE> 30
<TABLE>
<S> <C>
**4.11 -- Form of Warrant Agreement between the Company and the Warrant Agent.
**5.1 -- Opinion of legal counsel regarding legality of securities being registered.
*12.1 -- Computation of Ratio of Earnings to Fixed Charges.
*15.1 -- Independent Accountants' Awareness Letter.
*23.1 -- Consent of Price Waterhouse LLP.
**23.2 -- Consent of legal counsel (included in Exhibit 5.1).
24.1 -- Power of Attorney (included in Part II of the registration statement).
*25.1 -- Statement of Eligibility of Trustee on Form T-1 for Debt Securities.
- --------------
* Filed herewith.
** To be filed either by amendment or as an exhibit to a report of the Company filed pursuant to the Securities Exchange Act
of 1934, as amended (the "Exchange Act") and incorporated herein by reference.
</TABLE>
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(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.
(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 end of
the estimated maximum offering range may be reflected in
the form of prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
registration statement.
(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)
above do not apply if the information required to be
included in a post-effective amendment by those paragraphs
is contained in the periodic reports filed by the
registrant pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each such post- effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered which
remain unsold at the termination of the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is incorporated by
reference in the registration statement shall
II-3
<PAGE> 31
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.
The undersigned registrant hereby undertakes that:
(1) For the purpose of determining any liability under
the Securities Act, 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 registrant 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, 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.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the provisions in Item 15 above, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
II-4
<PAGE> 32
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Houston, State of Texas on July 10, 1997.
UNION TEXAS PETROLEUM HOLDINGS, INC.
By: /s/ DONALD M. MCMULLAN
----------------------------------
Donald M. McMullan
Vice President and Controller
POWER OF ATTORNEY
We the undersigned, directors and officers of Union Texas Petroleum
Holdings, Inc. (the "Company"), do hereby severally constitute and appoint John
L. Whitmire, Alan R. Crain, Jr., Larry D. Kalmbach and Donald M. McMullan and
each or any of them, our true and lawful attorneys-in-fact and agents, with
full power of substitution and resubstitution, for him and in his name, place
and stead, in any and all capacities, to sign any and all amendments or
post-effective amendments or supplements to this Registration Statement and any
Registration Statement relating to any offering made pursuant to this
Registration Statement that is to be effective upon filing pursuant to Rule
462(b) under the Securities Act of 1933, and to file the same with all exhibits
thereto, and all other documents in connection therewith, with the Securities
and Exchange Commission, granting unto said attorneys and agents, and each or
any of them, full power and authority to do and perform each and every act and
thing requisite and necessary to be done, as fully to all intents and purposes
as he might or could do in person, hereby ratifying and confirming all that
said attorneys-in-fact and agents, and each of them, or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ JOHN L. WHITMIRE Chairman of the Board and Chief July 10, 1997
--------------------------------------- Executive Officer (Principal Executive
(John L. Whitmire) Officer)
/s/ LARRY D. KALMBACH Vice President and Chief Financial July 10, 1997
--------------------------------------- Officer (Principal Financial Officer)
(Larry D. Kalmbach)
/s/ DONALD M. MCMULLAN Vice President and Controller (Principal July 10, 1997
--------------------------------------- Accounting Officer)
(Donald M. McMullan)
/s/ GLENN A. COX Director July 10, 1997
---------------------------------------
(Glenn A. Cox)
/s/ EDWARD A. GILHULY Director July 10, 1997
---------------------------------------
(Edward A. Gilhuly)
/s/ JAMES H. GREENE, JR. Director July 10, 1997
---------------------------------------
(James H. Greene, Jr.)
/s/ HENRY R. KRAVIS Director July 10, 1997
---------------------------------------
(Henry R. Kravis)
/s/ MICHAEL W. MICHELSON Director July 10, 1997
-------------------------------------
(Michael W. Michelson)
</TABLE>
II-5
<PAGE> 33
<TABLE>
<S> <C> <C>
/s/ WYLIE BERNARD PIEPER Director July 10, 1997
--------------------------------------
(Wylie Bernard Pieper)
/s/ STANLEY P. PORTER Director July 10, 1997
---------------------------------------
(Stanley P. Porter)
/s/ GEORGE ROBERTS Director July 10, 1997
---------------------------------------
(George Roberts)
/s/ RICHARD R. SHINN Director July 10, 1997
---------------------------------------
(Richard R. Shinn)
/s/ SELLERS STOUGH Director July 10, 1997
---------------------------------------
(Sellers Stough)
</TABLE>
II-6
<PAGE> 34
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit No. Description of Exhibit
----------- ----------------------
<S> <C> <C>
**1.1 -- Form of Underwriting Agreement between the Company and the Underwriter(s) with respect to the
Securities.
**1.2 -- Form of Agency Agreement.
**1.3 -- Form of Distribution Agreement.
4.1 -- Indenture dated as of March 15, 1995, among the Company, certain subsidiaries named therein and
The First National Bank of Chicago, as trustee (the "1995 Indenture"), with respect to Senior
Debt Securities (Filed as Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1995 (Commission File No. 1-9019) and incorporated herein by
reference).
4.2 -- Form of Indenture between the Company and The First National Bank of Chicago, as trustee, with
respect to Subordinated Debt Securities (Filed as Exhibit 4.2 to the Company's Registration
Statement No. 33-64049 on Form S-3, as amended).
4.3 -- Indenture for 8.25% Senior Notes due November 15, 1999, dated as of November 15, 1992, between
the Company., certain subsidiaries named therein and State Street Bank and Trust Company
(including form of note) (Filed as Exhibit 10.1 to the Company's Form 10-Q for quarter ended
March 31, 1994 (Commission File No. 1-9019) and incorporated herein by reference).
4.4 -- Specimen Form of 8 3/8% Senior Note due March 15, 2005, issued by the Company pursuant to the
1995 Indenture (Filed as Exhibit 10.2 to the Company's Form 10-Q for quarter ended March 31,
1995 (Commission File No. 1-9019) and incorporated herein by reference).
4.5 -- Specimen Form of 8 1/2% Senior Note due April 15, 2007, issued by the Company pursuant to the
1995 Indenture (Filed as Exhibit 10.3 to the Company's Form 10-Q for quarter ended March 31,
1995 (Commission File No. 1-9019) and incorporated herein by reference).
4.6 -- Supplement dated November 7, 1995 to Indenture dated as of November 15, 1992 for 8.25% Senior
Notes due 1999, between the Company, certain subsidiaries named therein and State Street Bank
and Trust Company (Filed as Exhibit 4.1 to the Company's Form 8-K dated November 17, 1995
(Commission File No. 1-9019) and incorporated herein by reference).
4.7 -- Supplement dated November 7, 1995 to the 1995 Indenture between the Company, the Subsidiaries
named therein and The First National Bank of Chicago (Filed as Exhibit 4.2 to the Company's
Form 8-K dated November 17, 1995 (Commission File No. 1-9019) and incorporated herein by
reference).
4.8 -- Form of Fixed Rate Medium-Term Note issued by the Company pursuant to the 1995 Indenture (Filed
as Exhibit 4.4 to the Company's Registration Statement No. 33-64049 and incorporated herein by
reference). The Company agrees to furnish to the Commission upon request a copy of each
instrument with respect to issues of such notes of the Company, the authorized principal amount
of which does not exceed 10% of the consolidated assets of the Company and its subsidiaries.
**4.9 -- Form of Designating Amendment for Preferred Stock.
**4.10 -- Form of Deposit Agreement.
</TABLE>
<PAGE> 35
<TABLE>
<S> <C> <C>
**4.11 -- Form of Warrant Agreement between the Company and the Warrant Agent.
**5.1 -- Opinion of legal counsel regarding legality of securities being registered.
*12.1 -- Computation of Ratio of Earnings to Fixed Charges.
*15.1 -- Independent Accountants' Awareness Letter.
*23.1 -- Consent of Price Waterhouse LLP.
**23.2 -- Consent of legal counsel (included in Exhibit 5.1).
24.1 -- Power of Attorney (included in Part II of the registration statement).
*25.1 -- Statement of Eligibility of Trustee on Form T-1 for Debt Securities.
</TABLE>
- --------------
* Filed herewith.
** To be filed either by amendment or as an exhibit to a report of the
Company filed pursuant to the Exchange Act and incorporated herein by
reference.
<PAGE> 1
EXHIBIT 12.1
RATIO OF EARNINGS TO FIXED CHARGES
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
YEARS ENDED DECEMBER 31, MARCH 31,
-----------------------------------------------------------------------------
1992 1993 1994 1995 1996 1996 1997
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Pretax income............................ $213,206 $26,983(1) $211,983 $253,327 $379,039 104,831 132,653
Fixed charges
Interest expense...................... 20,261 30,506 28,721 50,379 49,858 13,443 11,315
Preferred Stock dividends of
a subsidiary....................... 4,674 1,681
Capitalized debt cost................. 913 1,536 1,452 1,486 1,332 390 311
Interest portion of rent expenses..... 2,840 2,777 3,170 3,126 2,928 816 771
-------- ------- -------- -------- -------- -------- --------
Total fixed charges...... 28,688 36,500 33,343 54,991 54,118 14,649 12,397
Less: Capitalized interest, net.......... 14,408 4,623 1,464 4,845 8,690 1,479 3,634
-------- ------- -------- -------- -------- -------- --------
14,280 31,877 31,879 50,146 45,428 13,170 8,763
Earnings before fixed charges............ $227,486 $58,860 $243,862 $303,473 $424,467 $118,001 $141,416
======== ======= ======== ======== ======== ======== ========
Ratio of earnings to fixed charges....... 7.93 1.61 7.31 5.52 7.84 8.06 11.41
</TABLE>
(1) During 1993, the Company recorded a non-cash charge to depreciation,
depletion and amortization of $103 million pretax ($48 million after-tax)
for the write-down of its investment in the U.K. North Sea's Piper field.
Excluding the effect of the Piper write-down, the ratio of earnings to
fixed charges for 1993 would have been 4.45.
<PAGE> 1
EXHIBIT 15.1
INDEPENDENT ACCOUNTANTS' AWARENESS LETTER
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Dear Sirs:
We are aware that Union Texas Petroleum Holdings, Inc. has incorporated by
reference our report dated April 22, 1997 (issued pursuant to the provisions of
Statement on Auditing Standards No. 71) in the Prospectus constituting part of
its Registration Statement on Form S-3 to be filed on or about July 10, 1997.
We are also aware of our responsibilities under the Securities Act of 1933.
Yours very truly,
Price Waterhouse LLP
Houston, Texas
July 10, 1997
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report dated
February 14, 1997 appearing on page 35 of Union Texas Petroleum Holdings, Inc.'s
Annual Report on Form 10-K for the year ended December 31, 1996. We also
consent to the references to us under the heading "Experts" in such Prospectus.
PRICE WATERHOUSE LLP
Houston, Texas
July 10, 1997
<PAGE> 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)
-----------------------
UNION TEXAS PETROLEUM HOLDINGS, INC.
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
DELAWARE 76-0040040
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
1330 POST OAK BOULEVARD
HOUSTON, TEXAS 77056
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
DEBT SECURITIES
(TITLE OF INDENTURE SECURITIES)
<PAGE> 2
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> 3
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 30th day of June, 1997.
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE
BY /s/ RICHARD D. MANELLA
RICHARD D. MANELLA
VICE PRESIDENT
* EXHIBITS 1, 2, 3 AND 4 ARE HEREIN INCORPORATED BY REFERENCE TO EXHIBITS
BEARING IDENTICAL NUMBERS IN ITEM 16 OF THE FORM T-1 OF THE FIRST NATIONAL BANK
OF CHICAGO, FILED AS EXHIBIT 25.1 TO THE REGISTRATION STATEMENT ON FORM S-3 OF
SUNAMERICA INC. FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER
25, 1996 (REGISTRATION NO. 333-14201).
3
<PAGE> 4
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
June 30, 1997
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Union Texas
Petroleum Holdings, Inc. 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/ RICHARD D. MANELLA
RICHARD D. MANELLA
VICE PRESIDENT
4
<PAGE> 5
EXHIBIT 7
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/97
ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR MARCH 31, 1997
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>
C400
DOLLAR AMOUNTS IN ------------
THOUSANDS RCFD BIL MIL THOU
----------------- ---- ------------
<S> <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 3,871,170 1.a.
b. Interest-bearing balances(2) . . . . . . . . . . . . . . . . . . . 0071 6,498,314 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A). . . . . 1754 0 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D) . . . 1773 3,901,208 2.b.
3. Federal funds sold and securities purchased under agreements to
resell . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1350 4,612,975 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 2122 23,345,201 4.a.
b. LESS: Allowance for loan and lease losses . . . . . . . . . . . . RCFD 3123 420,963 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 22,924,238 4.d.
5. Trading assets (from Schedule RD-D) . . . . . . . . . . . . . . . . . 3545 8,792,158 5.
6. Premises and fixed assets (including capitalized leases). . . . . . . 2145 706,928 6.
7. Other real estate owned (from Schedule RC-M). . . . . . . . . . . . . 2150 6,563 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M) . . . . . . . . . . . . . . . . . . . 2130 61,551 8.
9. Customers' liability to this bank on acceptances outstanding . . . . 2155 488,866 9.
10. Intangible assets (from Schedule RC-M). . . . . . . . . . . . . . . . 2143 291,569 10.
11. Other assets (from Schedule RC-F) . . . . . . . . . . . . . . . . . . 2160 1,775,283 11.
12. Total assets (sum of items 1 through 11). . . . . . . . . . . . . . . 2170 53,930,823 12.
</TABLE>
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(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
5
<PAGE> 6
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/97
ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
SCHEDULE RC-CONTINUED
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
Thousands BIL MIL THOU
----------------- ------------
<S> <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 21,550,056 13.a.
(1) Noninterest-bearing(1). . . . . . . . . . . . . . . . . . . RCON 6631 8,895,137 13.a.1
(2) Interest-bearing . . . . . . . . . . . . . . . . . . . . . RCON 6636 12,654,919 13.a.2
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II). . . . . . . . . . . . . . . RCFN 2200 12,364,650 13.b.
(1) Noninterest bearing . . . . . . . . . . . . . . . . . . . . RCFN 6631 287,496 13.b.1
(2) Interest-bearing . . . . . . . . . . . . . . . . . . . . . RCFN 6636 12,077,154 13.b.2
14. Federal funds purchased and securities sold under agreements
to repurchase: . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 2800 3,817,421 14
15. a. Demand notes issued to the U.S. Treasury . . . . . . . . . . . RCON 2840 63,621 15.a.
b. Trading Liabilities(from Schedule RC-D) . . . . . . . . . . . . RCFD 3548 5,872,831 15b.
16. Other borrowed money:
a. With original maturity of one year or less . . . . . . . . . . RCFD 2332 2,607,549 16.a.
b. With original maturity of more than one year . . . . . . . . . RCFD 2333 322,414 16b.
17. Not applicable
18. Bank's liability on acceptance executed and outstanding . . . . . RCFD 2920 488,866 18.
19. Subordinated notes and debentures . . . . . . . . . . . . . . . . RCFD 3200 1,550,000 19.
20. Other liabilities (from Schedule RC-G) . . . . . . . . . . . . . . RCFD 2930 1,196,229 20.
21. Total liabilities (sum of items 13 through 20) . . . . . . . . . . RCFD 2948 49,833,637 21.
22. Not applicable
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 2,944,244 25.
26. a. Undivided profits and capital reserves . . . . . . . . . . . . RCFD 3632 954,885 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 8434 (1,089) 26.b.
27. Cumulative foreign currency translation adjustments . . . . . . . RCFD 3284 (1,712) 27.
28. Total equity capital (sum of items 23 through 27). . . . . . . . . RCFD 3210 4,097,186 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28). . . . . . . . . . . . . . . RCFD 3300 53,930,823 29.
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 1996 . . . . . . . . . . . . . . . . RCFD 6724 . . . . . . . . . . 2 M.1.
1. = Independent audit of the bank conducted in accordance 4. = Directors' examination of the bank performed by other
with generally accepted auditing standards by a certified external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2. = Independent audit of the bank's parent holding company 5. = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6. = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7. = Other audit procedures (excluding tax preparation work)
3. = Directors' examination of the bank conducted in 8. = No external audit work
accordance with generally accepted auditing standards by
a certified public accounting firm (may be required by
state chartering authority)
</TABLE>
- -----------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
6
