<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 22, 1998
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------
<TABLE>
<S> <C> <C>
PHILLIPS PETROLEUM COMPANY DELAWARE 73-0400345
PHILLIPS 66 CAPITAL III DELAWARE 73-6293884
PHILLIPS 66 CAPITAL IV DELAWARE 73-6293886
PHILLIPS 66 CAPITAL V DELAWARE TO BE APPLIED FOR
PHILLIPS 66 CAPITAL VI DELAWARE TO BE APPLIED FOR
(Exact Name of Registrant (State of Other Jurisdiction of (I.R.S. Employer Identification Number)
as Specified in its Charter) Incorporation or Organization)
JOHN A. CARRIG
PHILLIPS PETROLEUM COMPANY VICE PRESIDENT AND TREASURER
PHILLIPS BUILDING 3 PHILLIPS BUILDING
BARTLESVILLE, OKLAHOMA 74004 BARTLESVILLE, OKLAHOMA 74004
(918) 661-6600 (918) 661-5633
(Address, Including Zip Code, and Telephone Number, (Name, Address, Including Zip Code, and Telephone
Including Area Code, Registrant's Principal Executive Number, Including Area Code of Agent for Service)
Offices)
</TABLE>
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Copies to:
<TABLE>
<S> <C> <C>
DALE J. BILLAM, ESQ. JEREMIAH L. THOMAS III, ESQ. BRUCE K. DALLAS, ESQ.
PHILLIPS PETROLEUM COMPANY SIMPSON THACHER & BARTLETT DAVIS POLK & WARDWELL
1234 ADAMS BUILDING 425 LEXINGTON AVENUE 450 LEXINGTON AVENUE
BARTLESVILLE, OKLAHOMA 74004 NEW YORK, NEW YORK 10017 NEW YORK, NEW YORK 10017
(918) 661-5638 (212) 455-2000 (212) 450-4000
</TABLE>
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after this registration statement becomes effective.
---------------------
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 being offered only in connection with dividend or
interest reinvestment plans, please check the following box. [X]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If the delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [X]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=================================================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED(1)(2) PER UNIT(3) OFFERING PRICE REGISTRATION FEE
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<S> <C> <C> <C> <C>
Senior debt securities and subordinated debt
securities (collectively, "Debt Securities") of
Phillips Petroleum Company.......................
- ---------------------------------------------------------------------------------------------------------------------------------
Preferred Stock of Phillips Petroleum Company......
- ---------------------------------------------------------------------------------------------------------------------------------
Depositary Shares of Phillips Petroleum Company....
- ---------------------------------------------------------------------------------------------------------------------------------
Common Stock of Phillips Petroleum Company(4)......
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Stock Purchase Contracts of Phillips Petroleum
Company..........................................
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Stock Purchase Units of Phillips Petroleum
Company..........................................
- ---------------------------------------------------------------------------------------------------------------------------------
Prepaid Stock Purchase Contracts of Phillips
Petroleum Company................................
- ---------------------------------------------------------------------------------------------------------------------------------
Preferred Securities of Phillips 66 Capital III....
- ---------------------------------------------------------------------------------------------------------------------------------
Preferred Securities of Phillips 66 Capital IV.....
- ---------------------------------------------------------------------------------------------------------------------------------
Preferred Securities of Phillips 66 Capital V......
- ---------------------------------------------------------------------------------------------------------------------------------
Preferred Securities of Phillips 66 Capital VI.....
- ---------------------------------------------------------------------------------------------------------------------------------
Guarantees of Preferred Securities of Phillips 66
Capital III, Phillips 66 Capital IV, Phillips 66
Capital V and Phillips 66 Capital VI(5)..........
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Total.............................................. $700,000,000 100% $700,000,000 $206,500
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</TABLE>
(1) Such indeterminate number or amount of Debt Securities, Preferred Stock,
Depositary Shares, Common Stock, Stock Purchase Contracts and Stock Purchase
Units of Phillips Petroleum Company and Preferred Securities of Phillips 66
Capital III, Phillips 66 Capital IV, Phillips 66 Capital V and Phillips 66
Capital VI as may from time to time be issued at indeterminate prices and
the related Preferred Securities Guarantees.
(2) Such amount in U.S. dollars or the equivalent thereof in foreign currencies
as shall result in an aggregate initial offering price for all securities of
$700,000,000. In addition, this Registration Statement includes such
presently indeterminate number of Offered Securities (as defined herein) as
may be issuable from time to time upon conversion or exchange of the Offered
Securities being registered hereunder.
(3) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) and exclusive of accrued interest and dividends, if
any.
(4) Includes Junior Participating Preferred Stock purchase rights. Prior to the
occurrence of certain events, purchase rights for units of Junior
Participating Preferred Stock will not be evidenced separately from the
Common Stock.
(5) Phillips Petroleum Company is also registering under this registration
statement all other obligations that it may have with respect to Preferred
Securities issued by Phillips 66 Capital III, Phillips 66 Capital IV,
Phillips 66 Capital V and Phillips 66 Capital VI. No separate consideration
will be received for any Guarantee or any other such obligations.
---------------------
Pursuant to Rule 429 under the Securities Act of 1933, the Prospectus herein
is a combined Prospectus and also relates to up to $200,000,000 of unsold
securities of Phillips covered by Registration Statement No. 333-51559
previously filed with the Commission on Form S-3 and declared effective January
14, 1994 and to $100,000,000 of securities of the Phillips Capital Trusts
covered by Registration Statement No. 333-01209 previously filed with the
Commission and declared effective May 7, 1996.
The Registrants hereby amend this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrants
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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<PAGE> 2
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 MAY 22, 1998
PROSPECTUS
$1,000,000,000
PHILLIPS PETROLEUM COMPANY
SENIOR DEBT SECURITIES
---------------------
SUBORDINATED DEBT SECURITIES
---------------------
PREFERRED STOCK
---------------------
DEPOSITARY SHARES
---------------------
COMMON STOCK
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STOCK PURCHASE CONTRACTS
---------------------
STOCK PURCHASE UNITS
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PREPAID STOCK PURCHASE CONTRACTS
---------------------
PHILLIPS 66 CAPITAL III
PHILLIPS 66 CAPITAL IV
PHILLIPS 66 CAPITAL V
PHILLIPS 66 CAPITAL VI
PREFERRED SECURITIES
FULLY AND UNCONDITIONALLY GUARANTEED BY
PHILLIPS PETROLEUM COMPANY
---------------------
Phillips Petroleum Company ("Phillips" or the "Company"), a Delaware
corporation, may from time to time offer (i) its unsecured senior debt
securities (the "Senior Debt Securities") or subordinated debt securities (the
"Subordinated Debt Securities") consisting of debentures, notes or other
evidences of indebtedness, (ii) shares of its preferred stock, with or without
par value (the "Preferred Stock"), which may be represented by depositary shares
as described herein, (iii) shares of its common stock, par value $1.25 per share
(the "Common Stock"), (iv) stock purchase contracts ("Stock Purchase Contracts")
to purchase Common Stock or Preferred Stock or (v) stock purchase units ("Stock
Purchase Units"), each representing ownership of a Stock Purchase Contract and
any of (x) Senior Debt Securities or Subordinated Debt Securities, (y) debt
obligations of third parties, including U.S. Treasury Securities, or (z)
Preferred Securities (as defined below) of a Phillips Capital Trust (as defined
below), securing the holder's obligation to purchase Common Stock under the
Stock Purchase Contract. Such securities may be offered in one or more separate
classes or series, in amounts, at prices and on terms to be determined by market
conditions at the time of sale and to be set forth in a supplement or
supplements to this Prospectus (a "Prospectus Supplement"). Such securities may
be sold for U.S. dollars, foreign denominated currency or currency units;
amounts payable with respect to any such securities may likewise be payable in
U.S. dollars, foreign denominated currency or currency units -- in each case as
the Company specifically designates.
Phillips 66 Capital III, Phillips 66 Capital IV, Phillips 66 Capital V and
Phillips 66 Capital VI (each a "Phillips Capital Trust"), each a statutory
business trust formed under the laws of the State of Delaware, may offer, from
time to time, preferred securities, representing undivided beneficial interests
in the assets of the respective Phillips Capital Trust ("Preferred Securities").
The payment of periodic cash distributions ("distributions") with respect to
Preferred Securities of each of the Phillips Capital Trusts out of moneys held
by each of the Phillips Capital Trusts, and payment on liquidation, redemption
or otherwise with respect to such Preferred Securities, will be guaranteed by
Phillips to the extent described herein (each a "Preferred Securities
Guarantee"). See "Description of the Preferred Securities Guarantees" below.
Phillips' obligations under the Preferred Securities Guarantees are subordinate
and junior in right of payment to all other liabilities of Phillips and rank
pari passu with the most senior preferred stock, if any, issued from time to
time by Phillips. Subordinated Debt Securities may be issued and sold from time
to time in one or more series to a Phillips Capital Trust, or a trustee of such
Phillips Capital Trust, in connection with the investment of the proceeds from
the offering of Preferred Securities and Common Securities (as defined herein,
together the "Trust Securities") of such Phillips Capital Trust. The
Subordinated Debt Securities purchased by a Phillips Capital Trust may be
subsequently distributed pro rata to holders of Preferred Securities and Common
Securities in connection with the dissolution of such Phillips Capital Trust
upon the occurrence of certain events as may be described in an accompanying
Prospectus Supplement.
(continued on next page)
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is May , 1998
<PAGE> 3
Specific terms of the particular Senior Debt Securities, Subordinated Debt
Securities, Preferred Stock, Common Stock, Stock Purchase Contracts, Stock
Purchase Units, Preferred Securities and the related Preferred Securities
Guarantee, in respect of which this Prospectus is being delivered (the "Offered
Securities") will be set forth in an accompanying Prospectus Supplement or
Supplements, together with the terms of the offering of the Offered Securities,
the initial price thereof and the net proceeds from the sale thereof. The
Prospectus Supplement will set forth with regard to the particular Offered
Securities, certain terms thereof, including, where applicable, (i) in the case
of Senior Debt Securities and Subordinated Debt Securities, the ranking as
senior or subordinated Debt Securities, the specific designation, aggregate
principal amount, purchase price, maturity, interest rate (which may be fixed or
variable) if any, the time and method of calculating interest payments, if any,
listing, if any, on a securities exchange, authorized denomination, any
exchangeability, conversion, redemption, prepayment or sinking fund provisions,
the currency or currencies or currency unit or units in which principal,
premium, if any, or interest, if any, is payable, the right of Phillips, if any,
to defer payment of interest on the Subordinated Debt securities and the maximum
length of such deferral period, the initial public offering price and any other
specific terms of the Debt Securities; (ii) in the case of Preferred Stock, the
specific designation, number of shares, purchase price and the rights,
preferences and privileges thereof and any qualifications or restrictions
thereon (including dividends, liquidation value, voting rights, par value, if
any, terms for the redemption, conversion or exchange thereof and any other
specific terms of the Preferred Stock), listing, if any, on a securities
exchange and whether the Company has elected to offer the Preferred Stock in the
form of depositary shares; (iii) in the case of Common Stock, the number of
shares offered, the initial offering price, market price and dividend
information; (iv) in the case of Stock Purchase Contracts, the designation and
number of shares of Common Stock or Preferred Stock issuable thereunder, the
purchase price of the Common Stock or Preferred Stock, the date or dates on
which the Common Stock or Preferred Stock is required to be purchased by the
holders of the Stock Purchase Contracts, any periodic payments required to be
made by the Company to the holders of the Stock Purchase Contracts or vice
versa, and the terms of the offering and sale thereof; (v) in the case of Stock
Purchase Units, the specific terms of the Stock Purchase Contracts and any Debt
Securities or debt obligations of third parties or Preferred Securities of a
Phillips Capital Trust securing the holders' obligation to purchase the Common
Stock or Preferred Stock under the Stock Purchase Contracts, the ability of a
holder of such Stock Purchase Units to settle early the underlying Stock
Purchase Contract by delivering cash in exchange for the underlying collateral
and, if applicable, whether the Company will issue to such holder a Prepaid
Stock Purchase Contracts as a result of such early settlement and the specific
terms of the Prepaid Stock Purchase Contract and the terms of the offering and
sale of such Stock Purchase Units; and (vi) in the case of Preferred Securities
of a Phillips Capital Trust, the specific designation, number of securities,
liquidation amount per security, initial public offering price, and any listing
on a securities exchange, distribution rate (or method of calculation thereof),
dates on which distributions shall be payable and dates from which distributions
shall accrue, voting rights, if any, terms for any conversion or exchange into
other securities, any redemption or sinking fund provisions, any other rights,
preferences, privileges, limitations or restrictions relating to the Preferred
Securities and the terms upon which the proceeds of the sale of the Preferred
Securities shall be used to purchase a specific series of Subordinated Debt
Securities of the Company.
The Offered Securities may be offered in amounts, at prices and on terms to
be determined at the time of offering; provided, however, that the aggregate
initial public offering price of all Offered Securities shall not exceed
$1,000,000,000. The Prospectus Supplement relating to any series of Offered
Securities will contain information concerning certain United States federal
income tax considerations, if applicable to the Offered Securities.
Phillips and/or each of the Phillips Capital Trusts may sell the Offered
Securities directly, through agents designated from time to time, or through
underwriters or dealers. See "Plan of Distribution" below. If any agents of
Phillips and/or any Phillips Capital Trust or any underwriters or dealers are
involved in the sale of the Offered Securities, the names of such agents,
underwriters or dealers and any applicable commissions and discounts will be set
forth in any related Prospectus Supplement.
This Prospectus may not be used to consummate sales of securities unless
accompanied by a Prospectus Supplement.
<PAGE> 4
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL 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 ACCOMPANYING PROSPECTUS
SUPPLEMENT IN CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS OR ANY
ACCOMPANYING PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY PHILLIPS
PETROLEUM COMPANY, THE PHILLIPS CAPITAL TRUSTS OR THE UNDERWRITERS. NEITHER THE
DELIVERY OF THIS PROSPECTUS OR ANY ACCOMPANYING PROSPECTUS SUPPLEMENT NOR ANY
SALE MADE HEREUNDER AND THEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE AN
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF PHILLIPS PETROLEUM
COMPANY OR THE PHILLIPS CAPITAL TRUSTS SINCE THE DATE HEREOF. THIS PROSPECTUS OR
ANY ACCOMPANYING PROSPECTUS SUPPLEMENT DOES NOT CONSTITUTE AN OFFER OR
SOLICITATION BY ANYONE IN ANY STATE IN WHICH SUCH OFFER OR SOLICITATION IS NOT
AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT
QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION.
AVAILABLE INFORMATION
This Prospectus constitutes a part of a combined Registration Statement on
Form S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") filed by Phillips and the Phillips Capital Trusts with the
Securities and Exchange Commission (the "SEC") under the Securities Act of 1933,
as amended (the "Securities Act"), with respect to the Offered Securities. This
Prospectus does not contain all of the information set forth in such
Registration Statement, certain parts of which are omitted in accordance with
the rules and regulations of the SEC, although it does include a summary of the
material terms of the Senior Debt Indenture and the Subordinated Debt Indenture
(each as defined herein) and the Declaration of Trust of each Phillips Capital
Trust. Reference is made to such Registration Statement and to the exhibits
relating thereto for further information with respect to the Company, the
Phillips Capital Trusts and the Offered Securities. Any statements contained
herein concerning the provisions of any document filed as an exhibit to the
Registration Statement or otherwise filed with the SEC or incorporated by
reference herein are not necessarily complete, and, in each instance, reference
is made to the copy of such document so filed for a more complete description of
the matter involved. Each such statement is qualified in its entirety by such
reference.
Phillips 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 SEC.
Reports, proxy statements and other information concerning Phillips can be
inspected and copied at prescribed rates at the SEC's Public Reference Room,
Judiciary Plaza, 450 Fifth Street, Northwest, Washington, D.C. 20549, as well as
the following Regional Offices of the SEC: 7 World Trade Center, New York, New
York 10048; and Northwestern Atrium Center, 500 West Madison Street, Chicago,
Illinois 60661. Such reports, proxy statements and other information may also be
accessed through the SEC's web site on the Internet (http://www.sec.gov). Such
reports, proxy statements and other information may also be inspected at the
offices of the following stock exchanges on which certain of the Company's
securities are listed: the New York Stock Exchange, 20 Broad Street, New York,
New York 10005; the Pacific Exchange, 301 Pine Street, San Francisco, California
94104; and The Toronto Stock Exchange, The Exchange Tower, 2 First Canadian
Place, Toronto, Ontario, Canada M5X 1J2.
No separate financial statements of any of the Phillips Capital Trusts have
been included herein. Phillips does not consider that such financial statements
would be material to holders of the Preferred Securities because (i) all of the
voting securities of each of the Phillips Capital Trusts will be owned, directly
or indirectly, by Phillips, a reporting company under the Exchange Act, (ii)
each of the Phillips Capital Trusts has no independent operations but exists for
the sole purpose of issuing securities representing undivided beneficial
interests in the assets of such Phillips Capital Trust and investing the
proceeds thereof in Subordinated Debt Securities issued by Phillips, and (iii)
Phillips' obligations described herein and in any accompanying Prospectus
Supplement to provide certain indemnities in respect of and be responsible for
2
<PAGE> 5
certain costs, expenses, debts and liabilities of each of Phillips 66 Capital
III, IV, V and VI under the Subordinated Debt Indenture and any supplemental
indenture thereto and pursuant to the Declarations of each Trust, the guarantee
issued with respect to Preferred Securities issued by that Trust, the
Subordinated Debt Securities purchased by that Trust and the related Indenture,
taken together, constitute a full and unconditional guarantee of payments due on
the Preferred Securities. See "Description of the Subordinated Debt Securities"
and "Description of the Preferred Securities Guarantees."
The Phillips Capital Trusts are not currently subject to the information
reporting requirements of the Exchange Act. The Phillips Capital Trusts will
become subject to such requirements upon the effectiveness of the Registration
Statement, although they intend to seek and expect to receive exemptions
therefrom.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1997, and its Quarterly Report on Form 10-Q for the quarter ended March 31,
1998, which have been previously filed by the Company with the SEC, are
incorporated by reference in this Prospectus.
All documents filed by Phillips pursuant to Sections 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 Offered 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 this Prospectus or
in a document incorporated or deemed to be incorporated by reference herein or
in any Prospectus Supplement shall be deemed to be modified or superseded for
purposes of this Prospectus or any Prospectus Supplement to the extent that a
statement contained herein or therein (or in any subsequently filed document
that also is or is deemed to be incorporated by reference herein or therein)
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus or any Prospectus Supplement.
Phillips will provide without charge to each person to whom a copy of this
Prospectus has been delivered, upon the written or oral request of such person,
a copy of any or all of the documents referred to above which have been or may
be incorporated by reference herein (other than exhibits to such documents
unless such exhibits are specifically incorporated by reference in such
documents). Requests for such copies should be directed to Dale J. Billam,
Secretary, Phillips Petroleum Company, 1234 Adams Building, Bartlesville,
Oklahoma 74004 (telephone (918) 661-5638).
PHILLIPS PETROLEUM COMPANY
Phillips Petroleum Company, incorporated in Delaware in 1917, is a fully
integrated oil company engaged in petroleum exploration and production on a
worldwide basis, petroleum refining and marketing, and natural gas gathering and
processing, principally in the United States. Phillips also produces and
distributes chemicals worldwide. Its principal executive offices are located in
the Phillips Building, Bartlesville, Oklahoma 74004 (telephone (918) 661-6600).
3
<PAGE> 6
THE TRUSTS
Each of Phillips 66 Capital III, Phillips 66 Capital IV, Phillips 66
Capital V and Phillips 66 Capital VI is a statutory business trust formed under
Delaware law pursuant to (i) a separate declaration of trust (each a
"Declaration") executed by the Company, as sponsor for such trust (the
"Sponsor") and the Phillips Capital Trustees (as defined herein) for such trust
and (ii) the filing of a certificate of trust with the Delaware Secretary of
State on February 23, 1996, in the case of Phillips 66 Capital III and Phillips
66 Capital IV and on May in the case of Phillips 66 Capital V and Phillips 66
Capital VI. Each Phillips Capital Trust exists for the exclusive purposes of (i)
issuing the Preferred Securities and common securities representing undivided
beneficial interests in the assets of such Trust (the "Common Securities" and,
together with the Preferred Securities, the "Trust Securities"), (ii) investing
the gross proceeds of the Trust Securities in the Subordinated Debt Securities,
and (iii) engaging in only those other activities necessary or incidental
thereto. All of the Common Securities will be directly or indirectly owned by
the Company. The Common Securities will rank pari passu, and payments will be
made thereon pro rata, with the Preferred Securities except that upon an event
of default under the Declaration, the rights of the holders of the Common
Securities to payment in respect of distributions and payments upon liquidation,
redemption and otherwise will be subordinated to the rights of the holders of
the Preferred Securities. The Company will, directly or indirectly, acquire
Common Securities in an aggregate liquidation amount equal to 3 percent of the
total capital of each Phillips Capital Trust. Each Phillips Capital Trust has a
term of approximately 55 years, but may earlier terminate as provided in the
Declaration. Each Phillips Capital Trust's business and affairs will be
conducted by the trustees (the "Phillips Capital Trustees") appointed by the
Company, as the direct or indirect holder of all the Common Securities. The
holder of the Common Securities will be entitled to appoint, remove or replace
any of, or increase or reduce the number of, the Phillips Capital Trustees of a
Phillips Capital Trust. The duties and obligations of the Phillips Capital
Trustees shall be governed by the Declaration of such Phillips Capital Trust. A
majority of the Phillips Capital Trustees (the "Regular Trustees") of each
Phillips Capital Trust will be persons who are employees or officers of or
affiliated with the Company. One Phillips Capital Trustee of each Phillips
Capital Trust will be a financial institution which will be unaffiliated with
the Company and which shall act as property trustee and as indenture trustee for
purposes of the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), pursuant to the terms set forth in a Prospectus Supplement (the "Property
Trustee"). In addition, unless the Property Trustee maintains a principal place
of business in the State of Delaware, and otherwise meets the requirements of
applicable law, one Phillips Capital Trustee of each Phillips Capital Trust will
have its principal place of business or reside in the State of Delaware (the
"Delaware Trustee"). The Company will pay all fees and expenses related to the
Phillips Capital Trusts and the offering of Trust Securities, the payment of
which will be guaranteed by the Company. The office of the Delaware Trustee for
each Phillips Capital Trust in the State of Delaware is The Bank of New York
(Delaware), White Clay Center, Route 273, Newark, Delaware 19711. The principal
place of business of each Phillips Capital Trust shall be c/o Phillips Petroleum
Company, 3 Phillips Building, Bartlesville, Oklahoma 74004.
RATIOS OF EARNINGS TO FIXED CHARGES AND EARNINGS TO
COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The following table sets forth the ratios of earnings to fixed charges and
of earnings to combined fixed charges and preferred stock dividends for the
periods indicated:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
MARCH 31 YEARS ENDED DECEMBER 31
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1998 1997 1997 1996 1995 1994 1993
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed
charges.................. 6.1 5.5 5.4 6.9 3.4 3.2 2.3
Ratio of earnings to
combined fixed charges
and preferred stock
dividends................ 6.1 5.5 5.4 6.9 3.4 3.2 2.3
</TABLE>
For the purpose of computing the ratios of earnings to fixed charges and of
earnings to combined fixed charges and preferred stock dividends, earnings
consist of income before income taxes and extraordinary
4
<PAGE> 7
items, plus fixed charges (excluding capitalized interest and the portion of the
preferred dividend requirements of a subsidiary not previously deducted from
pretax income, but including amortization of amounts previously capitalized),
less equity in undistributed earnings of companies owned less than 50 percent.
Fixed charges consist of interest (including capitalized interest) on all
indebtedness, amortization of debt discount and expense, that portion of rental
expense which the Company believes to be representative of interest and the
amounts accrued to cover the preferred stock dividend requirements of a
subsidiary and capital trusts. A statement setting forth the computation of the
unaudited ratios of earnings to fixed charges and of earnings to combined fixed
charges and preferred stock dividends is filed as an exhibit to the Registration
Statement of which this Prospectus is a part.
USE OF PROCEEDS
Phillips intends to add the net proceeds from the sale of the Offered
Securities to its general funds, to be used for general corporate purposes,
including capital expenditures, repayment or repurchases of outstanding
long-term debt securities, investments in subsidiaries, working capital,
repayment of short-term commercial paper notes and/or other business
opportunities. Each Phillips Capital Trust will use all proceeds received from
the sale of the Offered Securities to purchase Subordinated Debt Securities from
Phillips.
DESCRIPTION OF THE SENIOR DEBT SECURITIES AND
SUBORDINATED DEBT SECURITIES
The Company's unsecured Senior Debt Securities and Subordinated Debt
Securities (collectively, the "Debt Securities"), consisting of notes,
debentures or other evidences of indebtedness, may be issued from time to time
in one or more series, in the case of Senior Debt Securities, under a Senior
Indenture dated as of September 15, 1990, as supplemented by Supplemental
Indenture No. 1 dated as of May 23, 1991 (as so supplemented, the "Senior Debt
Indenture") between the Company and U.S. Bank Trust National Association, as
successor to Continental Bank, National Association, as Trustee, and in the case
of Subordinated Debt Securities, under a Subordinated Indenture dated as of May
23, 1996 (the "Subordinated Debt Indenture") between the Company and the Bank of
New York, as Trustee. The Senior Debt Indenture and the Subordinated Debt
Indenture are sometimes hereinafter referred to individually as an "Indenture"
and collectively as the "Indentures." U.S. Bank Trust, Continental Bank and The
Bank of New York, in each of their respective capacities as trustee under the
respective Indentures, is sometimes referred to hereinafter as the "Trustee."
The Indentures are included as exhibits to the Registration Statement of which
this Prospectus is a part. The following description summarizes the material
terms of the Indentures and the Debt Securities and is qualified in its entirety
by reference to the detailed provisions of the applicable Indenture, which
contains the full text of such provisions, including the definition of certain
terms used herein, and other information regarding the Debt Securities. Wherever
particular sections or defined terms of the applicable Indenture are referred
to, such sections or defined terms are incorporated herein by reference as part
of the statement made, and the statement is qualified in its entirety by such
reference. Any Debt Securities offered by this Prospectus and the accompanying
Prospectus Supplement are referred to herein as the "Offered Debt Securities."
GENERAL
The Indentures do not limit the aggregate principal amount of Debt
Securities which may be issued thereunder and provide that the Debt Securities
may be issued from time to time in one or more series. The Debt Securities are
issuable in one or more series pursuant to an indenture supplemental to the
Indenture or a resolution of the Company's Board of Directors or a special
committee appointed thereby (each, a "Supplemental Indenture").
Reference is made to the Prospectus Supplement relating to the particular
Debt Securities being offered thereby for the following terms: (1) the
designation of such Debt Securities; (2) the aggregate principal amount of such
Debt Securities; (3) the percentage of their principal amount at which such Debt
Securities will be issued; (4) the date or dates on which such Debt Securities
will mature and the right, if any, to extend such date or dates; (5) the rate or
rates, if any, per annum, at which such Debt Securities will bear interest, or
the method of determination of such rate or rates; (6) the date or dates from
which such interest shall accrue, the interest payment dates on which such
interest will be payable or the manner of determination of such
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interest payment dates and the record dates for the determination of holders to
whom interest is payable on any such interest payment dates; (7) the right, if
any, to extend the interest payment periods and the duration of such extension;
(8) provisions for a sinking purchase or other analogous fund, if any; (9) the
period or periods, if any, within which, the price or prices of which, and the
terms and conditions upon which such Debt Securities may be redeemed, in whole
or in part, at the option of the Company or the holder; (10) the form of such
Debt Securities; (11) any provisions for payment of additional amounts for taxes
and any provision for redemption, in the event the Company must comply with
reporting requirements in respect of a Debt Security or must pay such additional
amounts in respect of any Debt Security; (12) the terms and conditions, if any,
upon which the Debt Securities of such series may be repayable prior to maturity
at the option of the holder thereof (which option may be conditional) and the
price or prices in the currency or currency unit in which such Debt Securities
are payable; (13) the currency, currencies or currency units for which such Debt
Securities may be purchased and the currency, currencies or currency units in
which the principal of and interest, if any, on such Debt Securities may be
payable; (14) the terms and conditions, if any, pursuant to which such Debt
Securities may be converted or exchanged for other securities of the Company or
any other person; (15) the terms and conditions, if any, pursuant to which the
principal of and premium, if any, and interest, if any, on such Debt Securities
are payable at the election of the Company or the holder thereof, in securities
or other property; and (16) any other specific terms of the Debt Securities.
Principal, premium, if any, and interest, if any, will be payable, and the Debt
Securities offered hereby will be transferable, at the corporate trust office of
the Trustee in New York, New York, provided that payment of interest, if any,
may be made at the option of the Company by check mailed to the address of the
person entitled thereto as it appears in the Security Register.
If a Prospectus Supplement specifies that a series of Debt Securities is
denominated in a currency or currency unit other than United States dollars,
such Prospectus Supplement shall also specify the denomination in which such
Debt Securities will be issued and the coin or currency in which the principal,
premium, if any, and interest, if any, on such Debt Securities will be payable,
which may be United States dollars based upon the exchange rate for such other
currency or currency unit existing on or about the time a payment is due.
The Indentures contain no covenants or other provisions to afford
protection to holders of the Debt Securities in the event of a highly leveraged
transaction or a change in control of the Company, except to the limited extent
described under "Limitation on Mergers and Sales of Assets" below.
FORM, EXCHANGE, REGISTRATION, TRANSFER AND PAYMENT
Unless otherwise specified in the applicable Prospectus Supplement, the
Debt Securities will be issued in fully registered form without coupons and in
denominations of $1,000 and integral multiples thereof. No service charge will
be made for any transfer or exchange of the Debt Securities, but the Company or
the Debt Trustee may require payment of a sum sufficient to cover any tax or
other government charge payable in connection therewith. Where Debt Securities
of any series are issued in bearer form, the special restrictions and
considerations, including special offering restrictions and special United
States federal income tax considerations, applicable to any such Debt Securities
and to payment on and transfer and exchange of such Debt Securities will be
described in the applicable Prospectus Supplement. Bearer Debt Securities will
be transferrable by delivery.
Unless otherwise provided in the applicable Prospectus Supplement,
principal and premium, if any, or interest, if any, will be payable and the Debt
Securities may be surrendered for payment or transferred at the offices of the
Trustee as paying and authenticating agent, provided that payment of interest on
registered securities may be made at the option of the Company by check mailed
to the address of the person entitled thereto as it appears in the Security
Register. Payment of Debt Securities in bearer form will be made at such paying
agencies outside of the United States as the Company may appoint.
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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 Securities that will be deposited with, or on behalf
of, a depositary (the "Global Depositary"), or its nominee, identified in the
Prospectus Supplement relating to such series. In such a case, one or more
Global Securities will be issued in a denomination or aggregate denomination
equal to the portion of the aggregate principal amount of Outstanding Debt
Securities of the series to be represented by such Global Security or
Securities. Unless and until it is exchanged in whole or in part for Debt
Securities in definitive registered form, a Global Security may not be
registered for transfer or exchange except as a whole by the Global Depositary
for such Global Security to a nominee for such Global Depositary and except in
the circumstances described in the applicable Prospectus Supplement.
The specific terms of the depositary arrangement with respect to any
portion of a series of Debt Securities to be represented by a Global Security
and a description of the Global Depositary will be provided in the applicable
Prospectus Supplement.
CERTAIN TERMS OF THE SENIOR DEBT SECURITIES
Certain Covenants of the Company
LIMITATION ON LIENS. The Company will not, and will not permit any
Restricted Subsidiary to, incur, issue, assume or guarantee any indebtedness for
borrowed money secured by a mortgage, pledge or other lien ("Mortgage") on any
Restricted Property, or on any shares of stock or indebtedness of a Restricted
Subsidiary, without providing that the Senior Debt Securities shall be secured
equally and ratably with (or prior to) such secured indebtedness, unless after
giving effect thereto the aggregate amount of all such indebtedness so secured
(other than indebtedness secured by excepted Mortgages referred to in the
following sentence), together with all Attributable Debt of the Company and its
Restricted Subsidiaries in respect of sale and leaseback transactions involving
Restricted Property, except sale and leaseback transactions, the proceeds of
which are applied to the retirement of funded debt, would not exceed 10 percent
of Consolidated Adjusted Net Assets as shown on the Company's latest audited
consolidated financial statements. This restriction will not apply to (a)
Mortgages on property of, or on any shares of stock or indebtedness of, any
corporation existing at the time such corporation becomes a Subsidiary, (b)
Mortgages on property existing at the time of acquisition thereof (including
acquisition through merger or consolidation) or to secure the payment of all or
any part of the purchase price or construction cost thereof or to secure any
indebtedness incurred prior to, at the time of, or within six months after such
acquisition or completion of such property for the purpose of financing all or
any part of the purchase price or construction cost thereof, (c) Mortgages on
substantially unimproved property to secure the cost of exploration, drilling or
development of, or improvements to, such property, and (d) Mortgages in favor of
the Company or a Restricted Subsidiary, and will not apply to any extension,
renewal or replacement of any Mortgage referred to in the foregoing clauses (a)
through (d), inclusive. The following types of transactions are not deemed to
create indebtedness secured by Mortgage (a) the sale or transfer of crude oil,
natural gas or natural gas liquids in place for a period of time until, or in an
amount such that, the purchaser will realize therefrom a specified amount of
money or of such oil, gas or gas liquids, or any other interest in property
commonly referred to as a "production payment," and (b) the Mortgage of any
property of the Company or any Subsidiary in favor of governmental bodies to
secure partial progress, advance or other payments to the Company or any
Subsidiary pursuant to any contract or statute, or the Mortgage of any property
to secure indebtedness of the pollution control or industrial revenue bond type.
LIMITATION ON SALES AND LEASEBACKS. Neither the Company nor any Restricted
Subsidiary may enter into any sale and leaseback transaction involving any
Restricted Property which has been owned or operated by the Company or such
Restricted Subsidiary for more than six months unless (a) the Company or such
Restricted Subsidiary could mortgage such property in an amount equal to the
Attributable Debt with respect to the sale and leaseback transaction without
equally and ratably securing the Securities of each series, (b) since the date
of the Senior Debt Indenture and within a period commencing 12 months prior to
the consummation of the sale and leaseback transaction and ending 12 months
after the consummation of such
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sale and leaseback transaction, the Company or any Restricted Subsidiary has
expended or will expend for any Restricted Property an amount equal to (i) the
greater of (x) the net proceeds of such sale and leaseback transaction and (y)
the fair market value of the Restricted Property so leased at the time of
entering into such transaction, as determined by the Board of Directors of the
Company (the greater of the sums specified in clauses (x) and (y) being referred
to herein as the "Net Proceeds of such transaction"), and the Company elects to
designate such amount as satisfying any obligation it would otherwise have under
clause (c) hereof, or (ii) a part of the Net Proceeds of such transaction and
the Company elects to designate such amount as satisfying part of the obligation
it would otherwise have under clause (c) hereof and applies an amount equal to
the remainder of such Net Proceeds as provided in clause (c) hereof, or (c) the
Company, within 12 months of the consummation of any such sale and leaseback
transaction, applies an amount equal to the Net Proceeds of such transaction
(less any amount elected under clause (b) hereof) to the retirement of Funded
Debt of the Company ranking on a parity with the Securities of each series. This
restriction will not apply to certain sale and leaseback transactions (a)
between the Company and a Restricted Subsidiary or between Restricted
Subsidiaries, or (b) involving the taking back of a lease for a period of less
than three years.
CERTAIN DEFINITIONS. "Attributable Debt" is defined to mean the total net
amount of rent (discounted at the rate per annum indicated in the Senior Debt
Indenture) required to be paid during the remaining term of any lease.
"Consolidated Adjusted Net Assets" is defined to mean the total amount of
assets after deducting therefrom (a) all current liabilities (excluding any
thereof which are by their terms extendible or renewable at the option of the
obligor thereon to a time more than 12 months after the time as of which the
amount thereof is being computed), and (b) total prepaid expenses and deferred
charges.
"Restricted Property" is defined to mean (a) any interest in property
located in the United States (including any interest in property located off the
coast of the United States operated pursuant to leases from any governmental
body) which is producing crude oil, natural gas or natural gas liquids in paying
quantities, or (b) any refining or manufacturing plant located in the United
States, except (i) related transportation or marketing facilities, or (ii) any
refining or manufacturing plant or portion thereof which, in the opinion of the
Board of Directors of the Company, is not a principal plant in relation to the
activities of the Company and its Restricted Subsidiaries as a whole.
"Restricted Subsidiary" is defined to mean any Subsidiary which owns a
Restricted Property if substantially all of the tangible property in which such
Subsidiary has an interest is (a) located in the United States, or (b) is
located off the coast of the United States and is operated pursuant to leases
from any governmental body. The Company currently has no Restricted
Subsidiaries.
"Subsidiary" is defined to mean a corporation, a majority of the
outstanding voting stock of which is owned, directly or indirectly, by the
Company or by one or more other Subsidiaries, or by the Company and one or more
other Subsidiaries.
Limitation on Mergers and Sales of Assets
The Company shall not consolidate with, or merge into, any corporation or
convey or transfer its properties and assets substantially as an entirety to any
Person unless the successor entity shall be a corporation organized under the
laws of the United States or any State or the District of Columbia and shall
expressly assume the obligations of the Company under the Senior Debt Indenture.
If, upon any such consolidation, merger, conveyance or transfer of the Company
with or into any Person or of any Restricted Subsidiary with or to any other
Subsidiary, any Restricted Property of the Company or of any Restricted
Subsidiary or any shares of stock or indebtedness of any Restricted Subsidiary
would thereupon become subject to any Mortgage (other than a Mortgage permitted
under the limitation on liens described above, without the Company's having to
secure the Senior Debt Securities equally and ratably), the Company will secure
the Senior Debt Securities (together with, if the Company shall so determine,
other securities ranking on a parity with the Senior Debt Securities) prior to
all liens other than any theretofore existing.
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Events of Default, Waiver, and Notice
As to each series of Senior Debt Securities, an Event of Default is defined
in the Senior Debt Indenture as being: default for 30 days in payment of any
interest on the Senior Debt Securities of that series; default in payment of
principal and premium, if any, on the Senior Debt Securities of that series when
due either at maturity, upon redemption, by declaration or otherwise; default by
the Company in the performance of any other of the covenants or agreements in
the Senior Debt Indenture which shall not have been remedied for a period of 90
days after notice; and certain events of bankruptcy, insolvency, and
reorganization of the Company. The Senior Debt Indenture provides that the
Trustee may withhold notice to the Securityholders of any default (except in
payment of principal or of interest or premium on the Senior Debt Securities) if
the Trustee considers it in the interest of Securityholders to do so.
The Senior Debt Indenture provides that, (a) if an Event of Default due to
the default in the payment of principal, interest or premium, if any, on any
series of Senior Debt Securities shall have occurred and be continuing, either
the Trustee or the holders of 25 percent in principal amount of the Senior Debt
Securities of all series affected thereby then outstanding may declare the
principal of all such Senior Debt Securities to be due and payable immediately,
and (b) if an Event of Default resulting from default in the performance of any
other of the covenants or agreements in the Senior Debt Indenture or certain
events of bankruptcy, insolvency and reorganization of the Company, either the
Trustee or the holders of 25 percent in principal amount of all Senior Debt
Securities then outstanding (treated as one class) may declare the principal of
all Senior Debt Securities to be due and payable immediately, but upon certain
conditions such declarations may be annulled and past defaults may be waived
(except defaults in payment of principal of or interest or premium on the Senior
Debt Securities) by the holders of a majority in principal amount of the Senior
Debt Securities of such series (or of all series, as the case may be) then
outstanding.
The holders of a majority in principal amount of the Senior Debt Securities
of any and all series affected and then outstanding shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee under the Senior Debt Indenture, provided that the
Senior Debt Securityholders shall have offered to the Trustee reasonable
indemnity against expenses and liabilities. The Senior Debt Indenture requires
the annual filing by the Company with the Trustee of a certificate as to the
absence of certain defaults under the Senior Debt Indenture.
Modifications of the Indenture
The Senior Debt Indenture contains provisions permitting the Company and
the Trustee, with the consent of the holders of not less than 66 2/3 percent in
principal amount of the Senior Debt Securities of all series affected by such
modification at the time outstanding, to modify the Senior Debt Indenture or any
supplemental indenture or the rights of the holders of the Senior Debt
Securities; provided that no such modification shall (i) extend the fixed
maturity of any Senior Debt Security, or reduce the principal amount thereof
(including in the case of a discounted Security the amount payable thereon in
the event of acceleration or the amount provable in bankruptcy) or any
redemption premium thereon, or reduce the rate or extend the time of payment of
interest thereon, or make the principal of, or interest or premium on, the
Senior Debt Securities payable in any coin or currency other than that provided
in the Senior Debt Securities, or impair or affect the right of any Senior Debt
Securityholder to institute suit for the payment thereof or the right of
prepayment, if any, at the option of the holder, without the consent of the
holder of each Senior Debt Security so affected, or (ii) reduce the aforesaid
percentage of Senior Debt Securities the consent of the holders of which is
required for any such modification without the consent of the holders of each
Senior Debt Security affected.
Defeasance
The Senior Debt Indenture provides that the Company, at the Company's
option: (a) will be Discharged from any and all obligations in respect of the
Senior Debt Securities of a series (except for certain obligations to register
the transfer or exchange of Senior Debt Securities, replace stolen, lost or
mutilated Senior Debt Securities, maintain paying agencies and hold moneys for
payment in trust) or (b) need not comply with
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certain restrictive covenants of the Senior Debt Indenture (including those
described herein), in each case if the Company deposits, in trust with the
Trustee or the Defeasance Agent, money or U.S. Government Obligations which
through the payment of interest thereon and principal thereof in accordance with
their terms will provide money, in an amount sufficient to pay all the principal
(including any mandatory sinking fund payments) of, and interest and premium, if
any, on, the Senior Debt Securities of such series on the dates such payments
are due in accordance with the terms of such Senior Debt Securities. To exercise
any such option, the Company is required to deliver to the Trustee and the
Defeasance Agent, if any, an opinion of counsel to the effect that (i) the
deposit and related defeasance would not cause the holders of the Senior Debt
Securities of such series to recognize income, gain or loss for federal income
tax purposes and, in the case of a Discharge pursuant to clause (a), such
opinion shall be accompanied by a private letter ruling to the effect received
from the United States Internal Revenue Service or a revenue ruling pertaining
to a comparable form of transaction to the effect published by the United States
Internal Revenue Service, and (ii) if listed on any national securities
exchange, such Senior Debt Securities would not be delisted from such exchange
as a result of the exercise of such option.
Governing Law
The Senior Debt Indenture and the Senior Debt Securities will be governed
by, and construed in accordance with, the internal laws of the State of New
York.
The Trustee
The Company may have normal banking relationships with U.S. Bank Trust
National Association as successor to the Continental Bank National Association
in the ordinary course of business.
CERTAIN TERMS OF THE SUBORDINATED DEBT SECURITIES
Subordination
The Subordinated Debt Securities will be subordinated and junior in right
of payment to certain other indebtedness of the Company to the extent set forth
in the applicable Prospectus Supplement.
Issuance of Subordinated Debt Securities to a Phillips Capital Trust
In the event Subordinated Debt Securities are issued to a Phillips Capital
Trust or a trustee of such trust in connection with the issuance of Trust
Securities by such Phillips Capital Trust, such Subordinated Debt Securities
subsequently may be distributed pro rata to the holders of such Trust Securities
in connection with the dissolution of such Phillips Capital Trust upon the
occurrence of certain events described in the Prospectus Supplement relating to
such Trust Securities. Only one series of Subordinated Debt Securities will be
issued to a Phillips Capital Trust or a trustee of such trust in connection with
the issuance of Trust Securities by such Phillips Capital Trust.
Certain Covenants of the Company
If Subordinated Debt Securities are issued to a Phillips Capital Trust or a
trustee of such trust in connection with the issuance of Trust Securities by
such Phillips Capital Trust and (i) there shall have occurred any event that
would constitute an Event of Default (as defined herein) or (ii) the Company
shall be in default with respect to its payment of any obligations under the
related Preferred Securities Guarantee or Common Securities Guarantee, then (a)
the Company shall not declare or pay any dividend on, make any distributions
with respect to, or redeem, purchase or make a liquidation payment with respect
to, any of its capital stock (other than (i) purchases or acquisitions of shares
of Phillips Common Stock in connection with the satisfaction by Phillips of its
obligations under any employee benefit plans, (ii) as a result of a
reclassification of Phillips capital stock or the exchange or conversion of one
class or series of Phillips capital stock for another class or series of
Phillips capital stock or (iii) the purchase of fractional interests in shares
of Phillips capital stock pursuant to the conversion or exchange provisions of
such Phillips capital stock or the security being converted or exchanged) or
make any guarantee payments with respect to the foregoing, and
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(b) the Company shall not make any payment of interest, principal or premium, if
any, on or repay, repurchase or redeem any debt securities (including
guarantees) issued by the Company which rank pari passu with or junior to such
Subordinated Debt Securities.
If Subordinated Debt Securities are issued to a Phillips Capital Trust or a
trustee of such trust in connection with the issuance of Trust Securities by
such Phillips Capital Trust and the Company shall have given notice of its
election to defer payments of interest on such Subordinated Debt Securities by
extending the interest payment period as provided in the Indenture and such
period, or any extension thereof, shall be continuing, then (a) the Company
shall not declare or pay any dividend on, make any distributions with respect
to, or redeem, purchase or make a liquidation payment with respect to, any of
its capital stock, and (b) the Company shall not make any payment of interest,
principal or premium, if any, on or repay, repurchase or redeem any debt
securities (including guarantees) issued by the Company which rank pari passu
with or junior to such Subordinated Debt Securities.
In the event Subordinated Debt Securities are issued to a Phillips Capital
Trust or a trustee of such trust in connection with the issuance of Trust
Securities of such Phillips Capital Trust, for so long as such Trust Securities
remain outstanding, the Company will covenant (i) to directly or indirectly
maintain 100 percent ownership of the Common Securities of such Phillips Capital
Trust; provided, however, that any permitted successor of the Company under the
Indenture may succeed to the Company's ownership of such Common Securities, (ii)
to use its reasonable efforts to cause such Phillips Capital Trust (a) to remain
a statutory business trust, except in connection with the distribution of
Subordinated Debt Securities to the holders of Trust Securities in liquidation
of such Phillips Capital Trust, the redemption of all of the Trust Securities of
such Phillips Capital Trust, or certain mergers, consolidations or
amalgamations, each as permitted by the Declaration of such Phillips Capital
Trust, and (b) to otherwise continue not to be classified as an association
taxable as a corporation or partnership for United States federal income tax
purposes and (iii) to use its reasonable efforts to cause each holder of Trust
Securities to be treated as owning an undivided beneficial interest in the
Subordinated Debt Securities.
Limitation on Mergers and Sales of Assets
The Company shall not consolidate with, or merge into, any corporation or
convey or transfer its properties and assets substantially as an entirety to any
Person unless the successor entity shall be a corporation organized under the
laws of the United States or any State or the District of Columbia and shall
expressly assume the obligations of the Company under the Subordinated Debt
Indenture.
Events of Default, Waiver and Notice
The Subordinated Debt Indenture provides that any one or more of the
following described events which has occurred and is continuing constitutes an
"Event of Default" with respect to each series of Subordinated Debt Securities:
(a) default for 30 days in payment of any interest on the Subordinated
Debt Securities of that series, including any Additional Interest in
respect thereof, when due; provided, however, that a valid extension of the
interest payment period by the Company shall not constitute a default in
the payment of interest for this purpose; or
(b) default in payment of principal and premium, if any, on the
Subordinated Debt Securities of that series when due either at maturity,
upon redemption, by declaration or otherwise; provided, however, that a
valid extension of the maturity of such Subordinated Debt Securities shall
not constitute a default for this purpose; or
(c) default by the Company in the performance of any other of the
covenants or agreements in the Indenture which shall not have been remedied
for a period of 90 days after notice; or
(d) certain events of bankruptcy, insolvency or reorganization of the
Company; or
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(e) in the event Subordinated Debt Securities are issued to a Phillips
Capital Trust or a trustee of such trust in connection with the issuance of
Trust Securities by such Phillips Capital Trust, the voluntary or
involuntary dissolution, winding-up or termination of such Phillips Capital
Trust, except in connection with the distribution of Subordinated Debt
Securities to the holders of Trust Securities in liquidation of such
Phillips Capital Trust, the redemption of all of the Trust Securities of
such Phillips Capital Trust, or certain mergers, consolidations or
amalgamations, each as permitted by the Declaration of such Phillips
Capital Trust.
The Subordinated Debt Indenture provides that the Trustee may withhold notice to
the holders of a series of Subordinated Debt Securities (except in payment of
principal or of interest or premium on the Subordinated Debt Securities) if the
Trustee considers it in the interest of such holders to do so.
The Subordinated Debt Indenture provides that, (a) if an Event of Default
due to the default in the payment of principal, interest or premium, if any, on
any series of Subordinated Debt Securities shall have occurred and be
continuing, either the Trustee or the holders of 25 percent in principal amount
of the Subordinated Debt Securities of all series affected thereby then
outstanding may declare the principal of all such Subordinated Debt Securities
to be due and payable immediately, and (b) if an Event of Default resulting from
default in the performance of any other of the covenants or agreements in the
Subordinated Debt Indenture or certain events of bankruptcy, insolvency and
reorganization of the Company shall have occurred and be continuing, either the
Trustee or the holders of 25 percent in principal amount of all Subordinated
Debt Securities then outstanding (treated as one class) may declare the
principal of all Subordinated Debt Securities to be due and payable immediately,
but upon certain conditions such declarations may be annulled and past defaults
may be waived (except defaults in payment of principal of or interest or premium
on the Subordinated Debt Securities) by the holders of a majority in principal
amount of the Subordinated Debt Securities of such series (or of all series, as
the case may be) then outstanding.
The holders of a majority in principal amount of the Subordinated Debt
Securities of any and all series affected and then outstanding shall have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee under the Subordinated Debt Indenture, provided
that the holders of the Subordinated Debt Securities shall have offered to the
Debt Trustee reasonable indemnity against expenses and liabilities. The
Subordinated Debt Indenture requires the annual filing by the Company with the
Trustee of a certificate as to the absence of certain defaults under the
Subordinated Debt Indenture.
Modification of the Indenture
The Subordinated Debt Indenture contains provisions permitting the Company
and the Trustee, with the consent of the holders of not less than a majority in
principal amount of the Subordinated Debt Securities of all series affected by
such modification at the time outstanding, to modify the Subordinated Debt
Indenture or any supplemental indenture or the rights of the holders of the
Subordinated Debt Securities; provided that no such modification shall (i)
extend the fixed maturity of any Subordinated Debt Security, or reduce the
principal amount thereof (including in the case of a discounted Subordinated
Debt Security the amount payable thereon in the event of acceleration or the
amount provable in bankruptcy) or any redemption premium thereon, or reduce the
rate or extend the time of payment of interest thereon, or make the principal
of, or interest or premium on, the Subordinated Debt Securities payable in any
coin or currency other than that provided in the Subordinated Debt Securities,
or impair or affect the right of any holder of Subordinated Debt Securities to
institute suit for the payment thereof or the right of prepayment, if any, at
the option of the holder, without the consent of the holder of each Subordinated
Debt Security so affected, or (ii) reduce the aforesaid percentage of
Subordinated Debt Securities the consent of the holders of which is required for
any such modification without the consent of the holders of each Subordinated
Debt Security affected.
Defeasance and Discharge
The Subordinated Debt Indenture provides that the Company, at the Company's
option: (a) will be Discharged from any and all obligations in respect of the
Subordinated Debt Securities of a series (except for certain obligations to
register the transfer or exchange of Subordinated Debt Securities, replace
stolen, lost or
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mutilated Subordinated Debt Securities, maintain paying agencies and hold moneys
for payment in trust) or (b) need not comply with certain restrictive covenants
of the Subordinated Debt Indenture (including those described herein), in each
case if the Company deposits, in trust with the Trustee or the Defeasance Agent,
money or U.S. Government Obligations which through the payment of interest
thereon and principal thereof in accordance with their terms will provide money,
in an amount sufficient to pay all the principal (including any mandatory
sinking fund payments) of, and interest and premium, if any, on, the
Subordinated Debt Securities of such series on the dates such payments are due
in accordance with the terms of such Subordinated Debt Securities. To exercise
any such option, the Company is required to deliver to the Trustee and the
Defeasance Agent, if any, an opinion of counsel to the effect that (i) the
deposit and related defeasance would not cause the holders of the Subordinated
Debt Securities of such series to recognize income, gain or loss for federal
income tax purposes and, in the case of a Discharge pursuant to clause (a), such
opinion shall be accompanied by a private letter ruling to the effect received
from the United States Internal Revenue Service or a revenue ruling pertaining
to a comparable form of transaction to the effect published by the United States
Internal Revenue Service, and (ii) if listed on any national securities
exchange, such Subordinated Debt Securities would not be delisted from such
exchange as a result of the exercise of such option.
Governing Law
The Subordinated Debt Indenture and the Subordinated Debt Securities will
be governed by, and construed in accordance with, the internal laws of the State
of New York.
The Trustee
The Company may have normal banking relationships with The Bank of New York
in the ordinary course of business.
DESCRIPTION OF THE PREFERRED SECURITIES
Each Phillips Capital Trust may issue, from time to time, only one series
of Preferred Securities having terms described in the Prospectus Supplement
relating thereto. The Declaration of each Phillips Capital Trust authorizes the
Regular Trustees of such Phillips Capital Trust to issue on behalf of such
Phillips Capital Trust one series of Preferred Securities. The Declaration will
be qualified as an indenture under the Trust Indenture Act. The Preferred
Securities will have such terms, including distributions, redemption, voting,
liquidation rights and such other preferred, deferred or other special rights or
such restrictions as shall be set forth in the Declaration or made part of the
Declaration by the Trust Indenture Act and which will mirror the terms of the
Subordinated Debt Securities held by the Phillips Capital Trust and described in
the Prospectus Supplement relating thereto. Reference is made to the Prospectus
Supplement relating to the Preferred Securities of the Phillips Capital Trust
for specific terms, including (i) the distinctive designation of such Preferred
Securities; (ii) the number of Preferred Securities issued by such Phillips
Capital Trust; (iii) the annual distribution rate (or method of determining such
rate) for Preferred Securities issued by such Phillips Capital Trust and the
date or dates upon which such distributions shall be payable; provided, however,
that distributions on such Preferred Securities shall be payable on a periodic
basis to holders of such Preferred Securities as of a record date in each period
during which such Preferred Securities are outstanding; (iv) whether
distributions on Preferred Securities issued by such Phillips Capital Trust
shall be cumulative, and, in the case of Preferred Securities having such
cumulative distribution rights, the date or dates or method of determining the
date or dates from which distributions on Preferred Securities issued by such
Phillips Capital Trust shall be cumulative; (v) the amount or amounts which
shall be paid out of the assets of such Phillips Capital Trust to the holders of
Preferred Securities of such Phillips Capital Trust upon voluntary or
involuntary dissolution, winding-up or termination of such Phillips Capital
Trust; (vi) the obligation, if any, of such Phillips Capital Trust to purchase
or redeem Preferred Securities issued by such Phillips Capital Trust and the
price or prices at which, the period or periods within which, and the terms and
conditions upon which, Preferred Securities issued by such Phillips Capital
Trust shall be purchased or redeemed, in whole or in part, pursuant to such
obligation; (vii) the voting rights, if any, of Preferred Securities issued by
such Phillips Capital Trust in
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addition to those required by law, including the number of votes per Preferred
Security and any requirement for the approval by the holders of Preferred
Securities, or of Preferred Securities issued by one or more Phillips Capital
Trusts, or of both, as a condition to specified action or amendments to the
Declaration of such Phillips Capital Trust; (viii) the terms and conditions, if
any, upon which the Subordinated Debt Securities may be distributed to holders
of Preferred Securities; (ix) if applicable, any securities exchange upon which
the Preferred Securities shall be listed; and (x) any other relevant rights,
preferences, privileges, limitations or restrictions of Preferred Securities
issued by such Phillips Capital Trust not inconsistent with the Declaration of
such Phillips Capital Trust or with applicable law. All Preferred Securities
offered hereby will be guaranteed by the Company to the extent set forth below
under "Description of the Preferred Securities Guarantees." Certain United
States federal income tax considerations applicable to any offering of Preferred
Securities will be described in the Prospectus Supplement relating thereto.
In connection with the issuance of Preferred Securities, each Phillips
Capital Trust will issue one series of Common Securities. The Declaration of
each Phillips Capital Trust authorizes the Regular Trustees of such trust to
issue on behalf of such Phillips Capital Trust one series of Common Securities
having such terms including distributions, redemption, voting, liquidation
rights or such restrictions as shall be set forth therein. The terms of the
Common Securities issued by a Phillips Capital Trust will be substantially
identical to the terms of the Preferred Securities issued by such trust and the
Common Securities will rank pari passu, and payments will be made thereon pro
rata, with the Preferred Securities except that, upon an event of default under
the Declaration, the rights of the holders of the Common Securities to payment
in respect of distributions and payments upon liquidation, redemption and
otherwise will be subordinated to the rights of the holders of the Preferred
Securities. Except in certain limited circumstances, the Common Securities will
also carry the right to vote to appoint, remove or replace any of the Phillips
Capital Trustees of a Phillips Capital Trust. All of the Common Securities of
each Phillips Capital Trust will be directly or indirectly owned by the Company.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF TRUST PREFERRED SECURITIES
If an Event of Default under the Declaration of a Phillips Capital Trust
occurs and is continuing, then the holders of Preferred Securities of such
Phillips Capital Trust would rely on the enforcement by the Institutional
Trustee of its rights as a holder of the applicable series of Subordinated Debt
Securities against the Company. In addition, the holders of a majority in
liquidation amount of the Preferred Securities of such Phillips Capital Trust
will have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Institutional Trustee or to direct
the exercise of any trust or power conferred upon the Institutional Trustee
under the applicable Declaration, including the right to direct the
Institutional Trustee to exercise the remedies available to it as a holder of
the Subordinated Debt Securities. If the Institutional Trustee fails to enforce
its rights under the applicable series of Subordinated Debt Securities, a holder
of Preferred Securities of such Phillips Capital Trust may institute a legal
proceeding directly against the Company to enforce the Institutional Trustee's
rights under the applicable series of Subordinated Debt Securities without first
instituting any legal proceeding against the Institutional Trustee or any other
person or entity. Notwithstanding the foregoing, if an Event of Default under
the applicable Declaration has occurred and is continuing and such event is
attributable to the failure of the Company to pay interest or principal on the
applicable series of Subordinated Debt Securities on the date such interest or
principal is otherwise payable (or in the case of redemption, on the redemption
date), then a holder of Preferred Securities of such Phillips Capital Trust may
directly institute a proceeding for enforcement of payment to such holder of the
principal of or interest on the applicable series of Subordinated Debt
Securities having a principal amount equal to the aggregate liquidation amount
of the Preferred Securities of such holder (a "Direct Action") on or after the
respective due date specified in the applicable series of Subordinated Debt
Securities. In connection with such Direct Action, the Company will be
subrogated to the rights of such holder of Preferred Securities under the
applicable Declaration to the extent of any payment made by the Company to such
holder of Preferred Securities in such Direct Action.
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DESCRIPTION OF THE PREFERRED SECURITIES GUARANTEES
Set forth below is a summary of information concerning the Preferred
Securities Guarantees which will be executed and delivered by Phillips for the
benefit of the holders from time to time of Preferred Securities. Each Preferred
Securities Guarantee will be qualified as an indenture under the Trust Indenture
Act. The Bank of New York will act as indenture trustee under each Preferred
Securities Guarantee for purposes of the Trust Indenture Act (the "Preferred
Guarantee Trustee"). The terms of each Preferred Securities Guarantee will be
those set forth in such Preferred Securities Guarantee and those made part of
such Preferred Securities Guarantee by the Trust Indenture Act. The summary of
the material terms of the Preferred Securities Guarantees does not purport to be
complete and is subject in all respects to the provisions of, and is qualified
in its entirety by reference to, the form of Preferred Securities Guarantee,
which is filed as an exhibit to the Registration Statement of which this
Prospectus forms a part, and the Trust Indenture Act. Each Preferred Securities
Guarantee will be held by the Preferred Guarantee Trustee for the benefit of the
holders of the Preferred Securities of the applicable Phillips Capital Trust.
GENERAL
Pursuant to each Preferred Securities Guarantee, the Company will
irrevocably and unconditionally agree, to the extent set forth therein, to pay
in full, to the holders of the Preferred Securities issued by a Phillips Capital
Trust, the Guarantee Payments (as defined herein) (except to the extent paid by
such Phillips Capital Trust), as and when due, regardless of any defense, right
of set-off or counterclaim which such Phillips Capital Trust may have or assert.
The following payments with respect to Preferred Securities issued by a Phillips
Capital Trust to the extent not paid by such Phillips Capital Trust (the
"Guarantee Payments"), will be subject to the Preferred Securities Guarantee
thereon (without duplication): (i) any accrued and unpaid distributions which
are required to be paid on such Preferred Securities, to the extent such
Phillips Capital Trust shall have funds available therefor; (ii) the redemption
price, including all accrued and unpaid distributions (the "Redemption Price"),
to the extent such Phillips Capital Trust has funds available therefor with
respect to any Preferred Securities called for redemption by such Phillips
Capital Trust and (iii) upon a voluntary or involuntary dissolution, winding-up
or termination of such Phillips Capital Trust (other than in connection with the
distribution of Subordinated Debt Securities to the holders of Preferred
Securities or the redemption of all of the Preferred Securities), the lesser of
(a) the aggregate of the liquidation amount and all accrued and unpaid
distributions on such Preferred Securities to the date of payment, to the extent
such Phillips Capital Trust has funds available therefor and (b) the amount of
assets of such Phillips Capital Trust remaining available for distribution to
holders of such Preferred Securities in liquidation of such Phillips Capital
Trust. The redemption price and liquidation amount will be fixed at the time the
Preferred Securities are issued. The Company's obligation to make a Guarantee
Payment may be satisfied by direct payment of the required amounts by the
Company to the holders of Preferred Securities or by causing the applicable
Phillips Capital Trust to pay such amounts to such holders.
Each Preferred Securities Guarantee will not apply to any payment of
distributions except to the extent such Phillips Capital Trust shall have funds
available therefor. If the Company does not make interest payments on the
Subordinated Debt Securities purchased by a Phillips Capital Trust, such
Phillips Capital Trust will not pay distributions on the Preferred Securities
issued by such Phillips Capital Trust and will not have funds available
therefor. See "Description of the Subordinated Debt Securities -- Certain
Covenants of the Company." The Preferred Securities Guarantee, when taken
together with the Company's obligations under the Subordinated Debt Securities,
the Indenture and the Declaration, including its obligations to pay costs,
expenses, debts and liabilities of such Phillips Capital Trust (other than with
respect to the Trust Securities), will provide a full and unconditional
guarantee on a subordinated basis by the Company of payments due on the
Preferred Securities.
The Company has also agreed separately to irrevocably and unconditionally
guarantee the obligations of the Phillips Capital Trusts with respect to the
Common Securities (the "Common Securities Guarantees") to the same extent as the
Preferred Securities Guarantees, except that upon an event of default under the
Indenture, holders of Preferred Securities shall have priority over holders of
Common Securities with respect to distributions and payments on liquidation,
redemption or otherwise.
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CERTAIN COVENANTS OF THE COMPANY
In each Preferred Securities Guarantee, the Company will covenant that, so
long as any Preferred Securities issued by the applicable Phillips Capital Trust
remain outstanding, if there shall have occurred any event that would constitute
an event of default under such Preferred Securities Guarantee or the Declaration
of such Phillips Capital Trust, then (a) the Company shall not declare or pay
any dividend on, make any distributions with respect to, or redeem, purchase or
make liquidation payment with respect to, any of its capital stock (other than
(i) purchases or acquisitions of shares of Phillips Common Stock in connection
with the satisfaction by Phillips of its obligations under any employee benefit
plans or the satisfaction by Phillips of its obligations pursuant to any
contract or security requiring Phillips to purchase shares of Phillips Common
Stock, (ii) as a result of a reclassification of Phillips capital stock or the
exchange or conversion of one class or series of Phillips capital stock for
another class or series of Phillips capital stock or, (iii) the purchase of
fractional interests in shares of Phillips capital stock pursuant to the
conversion or exchange provisions of such Phillips capital stock or the security
being converted or exchanged) or make any guarantee payments with respect to the
foregoing and (b) the Company shall not make any payment of interest, principal
or premium, if any, on or repay, repurchase or redeem any debt securities
(including guarantees) issued by the Company which rank pari passu with or
junior to such Subordinated Debt Securities.
MODIFICATION OF THE PREFERRED SECURITIES GUARANTEES; ASSIGNMENT
Except with respect to any changes which do not adversely affect the rights
of holders of Preferred Securities (in which case no vote will be required),
each Preferred Securities Guarantee may be amended only with the prior approval
of the holders of not less than a majority in liquidation amount of the
outstanding Preferred Securities issued by the applicable Phillips Capital
Trust. The manner of obtaining any such approval of holders of such Preferred
Securities will be as set forth in an accompanying Prospectus Supplement. All
guarantees and agreements contained in a Preferred Securities Guarantee shall
bind the successors, assigns, receivers, trustees and representatives of the
Company and shall inure to the benefit of the holders of the Preferred
Securities of the applicable Phillips Capital Trust then outstanding.
TERMINATION
Each Preferred Securities Guarantee will terminate as to the Preferred
Securities issued by the applicable Phillips Capital Trust (a) upon full payment
of the Redemption Price of all Preferred Securities of such Phillips Capital
Trust, (b) upon distribution of the Subordinated Debt Securities held by such
Phillips Capital Trust to the holders of the Preferred Securities of such
Phillips Capital Trust or (c) upon full payment of the amounts payable in
accordance with the Declaration of such Phillips Capital Trust upon liquidation
of such Phillips Capital Trust. Each Preferred Securities Guarantee will
continue to be effective or will be reinstated, as the case may be, if at any
time any holder of Preferred Securities issued by the applicable Phillips
Capital Trust must restore payment of any sums paid under such Preferred
Securities or such Preferred Securities Guarantee.
EVENTS OF DEFAULT
An event of default under a Preferred Securities Guarantee will occur upon
the failure of the Company to perform any of its payment or other obligations
thereunder.
The holders of a majority in liquidation amount of the Preferred Securities
relating to such Preferred Securities Guarantee have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Preferred Guarantee Trustee in respect of the Preferred Securities Guarantee
or to direct the exercise of any trust or power conferred upon the Preferred
Guarantee Trustee under such Preferred Securities. If the Preferred Guarantee
Trustee fails to enforce such Preferred Securities Guarantee, any holder of
Preferred Securities relating to such Preferred Securities Guarantee may
institute a legal proceeding directly against the Company to enforce the
Preferred Guarantee Trustee's rights under such Preferred Securities Guarantee,
without first instituting a legal proceeding against the relevant Phillips
Capital Trust, the Preferred Guarantee Trustee or any other person or entity.
Notwithstanding the foregoing, if the Company
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has failed to make a guarantee payment, a holder of Preferred Securities may
directly institute a proceeding against the Company for enforcement of the
Preferred Securities Guarantee for such payment. The Company waives any right or
remedy to require that any action be brought first against such Phillips Capital
Trust or any other person or entity before proceeding directly against the
Company.
The Preferred Guarantee Trustee, prior to the occurrence of a default with
respect to a Preferred Securities Guarantee, undertakes to perform only such
duties as are specifically set forth in such Preferred Securities Guarantee and,
after default, shall exercise the same degree of care as a prudent individual
would exercise in the conduct of his or her own affairs. Subject to such
provisions, the Preferred Guarantee Trustee is under no obligation to exercise
any of the powers vested in it by a Preferred Securities Guarantee at the
request of any holder of Preferred Securities, unless offered reasonable
indemnity against the costs, expenses and liabilities which might be incurred
thereby.
STATUS OF THE PREFERRED SECURITIES GUARANTEES
The Preferred Securities Guarantees will constitute unsecured obligations
of the Company and will rank (i) subordinate and junior in right of payment to
all other liabilities of the Company, (ii) pari passu with the most senior
preferred or preference stock now or hereafter issued by the Company and with
any guarantee now or hereafter entered into by Phillips in respect of any
preferred or preference stock of any affiliate of the Company, and (iii) senior
to the Company's common stock. The terms of the Preferred Securities provide
that each holder of Preferred Securities issued by the applicable Phillips
Capital Trust by acceptance thereof agrees to the subordination provisions and
other terms of the Preferred Securities Guarantee relating thereto.
The Preferred Securities Guarantees will constitute a guarantee of payment
and not of collection (that is, the guaranteed party may institute a legal
proceeding directly against the guarantor to enforce its rights under the
Preferred Securities Guarantee without instituting a legal proceeding against
any other person or entity).
INFORMATION CONCERNING THE PREFERRED GUARANTEE TRUSTEE
The Company and certain of its affiliates maintain a banking relationship
with the Preferred Guarantee Trustee.
GOVERNING LAW
The Preferred Securities Guarantees will be governed by and construed in
accordance with the internal laws of the State of New York.
EFFECT OF OBLIGATIONS UNDER THE
SUBORDINATED DEBT SECURITIES AND THE GUARANTEE
As set forth in the Declaration, the sole purpose of each of the Phillips
Capital Trusts is to issue the Trust Securities evidencing undivided beneficial
interests in the assets of each of the Phillips Capital Trusts, and to invest
the proceeds from such issuance and sale in the Subordinated Debt Securities.
As long as payments of interest and other payments are made when due on the
Subordinated Debt Securities, such payments will be sufficient to cover
distributions and payments due on the Trust Securities because of the following
factors: (i) the aggregate principal amount of Subordinated Debt Securities will
be equal to the sum of the aggregate stated liquidation amount of the Trust
Securities; (ii) the interest rate and the interest and other payment dates on
the Subordinated Debt Securities will match the distribution rate and
distribution and other payment dates for the Preferred Securities; (iii)
Phillips shall pay all, and the applicable Phillips Capital Trust shall not be
obligated to pay, directly or indirectly, all costs, expenses, debt, and
obligations of the applicable Phillips Capital Trust (other than with respect to
the Trust Securities); and (iv) the Declaration further provides that the
Phillips Trustees shall not take or cause or permit the applicable Phillips
Capital Trust to, among other things, engage in any activity that is not
consistent with the purposes of the applicable Phillips Capital Trust.
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Payments of distributions (to the extent funds therefor are available) and
other payments due on the Preferred Securities (to the extent funds therefor are
available) are guaranteed by Phillips as and to the extent set forth under
"Description of the Preferred Securities Guarantees." If Phillips does not make
interest payments on the Subordinated Debt Securities purchased by the
applicable Phillips Capital Trust, it is expected that the applicable Phillips
Capital Trust will not have sufficient funds to pay distributions on the
Preferred Securities. The Guarantee does not apply to any payment of
distributions unless and until the applicable Phillips Capital Trust has
sufficient funds for the payment of such distributions. The Guarantee covers the
payment of distributions and other payments on the Preferred Securities only if
and to the extent that Phillips has made a payment of interest or principal on
the Subordinated Debt Securities held by the applicable Phillips Capital Trust
as its sole asset. The Guarantee, when taken together with Phillips' obligations
under the Subordinated Debt Securities and the Indenture and its obligations
under the Declaration, including its obligations to pay costs, expenses, debts
and liabilities of the applicable Phillips Capital Trust (other than with
respect to the Trust Securities), provide a full and unconditional guarantee of
amounts on the Preferred Securities.
If Phillips fails to make interest or other payments on the Subordinated
Debt Securities when due (taking account of any Extension Period), the
Declaration provides a mechanism whereby the holders of the Preferred
Securities, using the procedures described in "Description of the Preferred
Securities -- Book-Entry Only Issuance -- The Depository Trust Company" and
"-- Voting Rights" in any accompanying Prospectus Supplement, may direct the
Institutional Trustee to enforce its rights under the Subordinated Debt
Securities. If the Institutional Trustee fails to enforce its rights under the
Subordinated Debt Securities, a holder of Preferred Securities may institute a
legal proceeding against Phillips to enforce the Institutional Trustee's rights
under the Subordinated Debt Securities without first instituting any legal
proceeding against the Institutional Trustee or any other person or entity.
Notwithstanding the foregoing, if a Declaration Event of Default has occurred
and is continuing and such event is attributable to the failure of Phillips to
pay interest or principal on the Subordinated Debt Securities on the date such
interest or principal is otherwise payable (or in the case of redemption on the
redemption date), then a holder of Preferred Securities may institute a Direct
Action for payment on or after the respective due date specified in the
Subordinated Debt Securities. In connection with such Direct Action, Phillips
will be subrogated to the rights of such holder of Preferred Securities under
the Declaration to the extent of any payment made by Phillips to such holder of
Preferred Securities in such Direct Action. Phillips, under the Guarantee,
acknowledges that the Guarantee Trustee shall enforce the Guarantee on behalf of
the holders of the Preferred Securities. If Phillips fails to make payments
under the Guarantee, the Guarantee provides a mechanism whereby the holders of
the Preferred Securities may direct the Guarantee Trustee to enforce its rights
thereunder. Any holder of Preferred Securities may institute a legal proceeding
directly against Phillips to enforce the Guarantee Trustee's rights under the
Guarantee without first instituting a legal proceeding against the applicable
Phillips Capital Trust, the Guarantee Trustee, or any other person or entity.
Phillips and each of the Phillips Capital Trusts believe that the above
mechanisms and obligations, taken together, provide a full and unconditional
guarantee by Phillips of payments due on the Preferred Securities. See
"Description of the Preferred Securities Guarantees -- General."
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DESCRIPTION OF PREFERRED STOCK
The following description of the terms of the Preferred Stock sets forth
certain general terms and provisions of the Preferred Stock to which any
Prospectus Supplement may relate. Certain terms of any series of the Preferred
Stock offered by any Prospectus Supplement will be described in the Prospectus
Supplement relating to such series of the Preferred Stock. 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
Certificate of Designations relating to such series of the Preferred Stock,
which will be filed with the Commission promptly after the offering of such
series of Preferred Stock.
GENERAL
Under the Company's Restated Certificate of Incorporation (the "Charter"),
the Board of Directors of the Company (the "Board of Directors") is authorized,
without further stockholder action, to provide for the issuance of up to
300,000,000 shares of preferred stock, with or without par value, in one or more
series, with such voting powers and with such designations, preferences and
relative, participating, optional or other special rights, and qualifications,
limitations or restrictions, as shall be set forth in resolutions providing for
the issue thereof adopted by the Board of Directors or a duly authorized
committee thereof. The Company may amend from time to time the Charter to
increase the number of authorized shares of preferred stock in the manner
provided in the Charter and the Delaware General Corporation Law ("DGCL").
The Preferred Stock shall have the dividend, liquidation, redemption,
voting and conversion rights set forth in the Prospectus Supplement relating to
a particular series of the Preferred Stock. Reference is made to the Prospectus
Supplement relating to the particular series of the Preferred Stock offered
thereby for specific terms, including: (i) the title and liquidation preference
per share of such Preferred Stock and the number of shares offered; (ii) the
price at which such Preferred Stock will be issued; (iii) the dividend rate (or
method of calculation), the dates on which dividends shall be payable, whether
such dividends shall be cumulative or noncumulative and, if cumulative, the
dates from which dividends shall commence to accumulate; (iv) any redemption or
sinking fund provisions of such Preferred Stock; (v) any conversion provisions
of such Preferred Stock; (vi) whether the Company has elected to offer
Depositary Shares with respect to such Preferred Stock as described below under
"Description of Depositary Shares" (vii) the voting rights, if any, of such
Preferred Stock; and (viii) any additional dividend, liquidation, redemption,
sinking fund and other rights, preferences, privileges, limitations and
restrictions of such Preferred Stock.
The Preferred Stock will, when issued, be fully paid and nonassessable.
Unless otherwise specified in the Prospectus Supplement relating to a particular
series of the Preferred Stock, each series of the Preferred Stock will rank on a
parity as to dividends and distributions in the event of a liquidation with any
outstanding preferred stock of the Company and each other series of the
Preferred Stock.
DESCRIPTION OF DEPOSITARY SHARES
The description set forth below and in any Prospectus Supplement of certain
provisions of the Deposit Agreement (as defined below) and of the Depositary
Shares and Depositary Receipts summarizes the material terms of the Deposit
Agreement and of the Depositary Shares and Depositary Receipts, and is qualified
in its entirety by reference to, the form of Deposit Agreement and form of
Depositary Receipts relating to each series of the Preferred Stock.
GENERAL
The Company may, at its option, elect to have shares of Preferred Stock be
represented by Depositary Shares. The shares of any series of the Preferred
Stock underlying the Depositary Shares will be deposited under a separate
deposit agreement (the "Deposit Agreement") between the Company and a bank or
trust company selected by the Company (the "Preferred Stock Depositary"). The
Prospectus Supplement relating to a series of Depositary Shares will set forth
the name and address of the Preferred Stock Depositary. Subject
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to the terms of the Deposit Agreement, each owner of a Depositary Share will be
entitled, proportionately, to all the rights, preferences and privileges of the
Preferred Stock represented thereby (including dividend, voting, redemption,
conversion, exchange and liquidation rights).
The Depositary Shares will be evidenced by Depositary Receipts issued
pursuant to the Deposit Agreement, each of which will represent the applicable
interest in a number of shares of a particular series of the Preferred Stock
described in the applicable Prospectus Supplement.
A holder of Depositary Shares will be entitled to receive the shares of
Preferred Stock (but only in whole shares of Preferred Stock) underlying such
Depositary Shares. If the Depositary Receipts delivered by the holder evidence a
number of Depositary Shares in excess of the whole number of shares of Preferred
Stock to be withdrawn, the Depositary will deliver to such holder at the same
time a new Depositary Receipt evidencing such excess number of Depositary
Shares.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Preferred Stock Depositary will distribute all cash dividends or other
cash distributions in respect to the Preferred Stock to the record holders of
Depositary Receipts in proportion, insofar as possible, to the number of
Depositary Shares owned by such holders.
In the event of a distribution other than in cash in respect to the
Preferred Stock, the Preferred Stock Depositary will distribute property
received by it to the record holders of Depositary Receipts in proportion,
insofar as possible, to the number of Depositary Shares owned by such holders,
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, adopt such method as it deems equitable and practicable
for the purpose of effecting such distribution, including sale (at public or
private sale) of such property and distribution of the net proceeds from such
sale to such holders.
The amount so distributed in any of the foregoing cases will be reduced by
any amount required to be withheld by the Company or the Preferred Stock
Depositary on account of taxes.
CONVERSION AND EXCHANGE
If any Preferred Stock underlying the Depositary Shares is subject to
provisions relating to its conversion or exchange as set forth in the Prospectus
Supplement relating thereto, each record holder of Depositary Shares will have
the right or obligation to convert or exchange such Depositary Shares pursuant
to the terms thereof.
REDEMPTION OF DEPOSITARY SHARES
If Preferred Stock underlying the Depositary Shares is subject to
redemption, the Depositary Shares will be redeemed from the proceeds received by
the Preferred Stock Depositary resulting from the redemption, in whole or in
part, of the Preferred Stock held by the Preferred Stock Depositary. The
redemption price per Depositary Share will be equal to the aggregate redemption
price payable with respect to the number of shares of Preferred Stock underlying
the Depositary Shares. Whenever the Company redeems Preferred Stock from the
Preferred Stock Depositary, the Preferred Stock Depositary will redeem as of the
same redemption date a proportionate number of Depositary Shares representing
the shares of Preferred Stock that were redeemed. If less than all the
Depositary Shares are to be redeemed, the Depositary Shares to be redeemed will
be selected by lot or pro rata as may be determined by the Company.
After the date fixed for redemption, the Depositary Shares so called for
redemption will no longer be deemed to be outstanding and all rights of the
holders of the Depositary Shares will cease, except the right to receive the
redemption price upon such redemption. Any funds deposited by the Company with
the Preferred Stock Depositary for any Depositary Shares which the holders
thereof fail to redeem shall be returned to the Company after a period of two
years from the date such funds are so deposited.
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VOTING
Upon receipt of notice of any meeting at which the holders of any shares of
Preferred Stock underlying the Depositary Shares are entitled to vote, the
Preferred Stock Depositary will mail the information contained in such notice to
the record holders of the Depositary Receipts. Each record holder of such
Depositary Receipts on the record date (which will be the same date as the
record date for the Preferred Stock) will be entitled to instruct the Preferred
Stock Depositary as to the exercise of the voting rights pertaining to the
number of shares of Preferred Stock underlying such holder's Depositary Shares.
The Preferred Stock Depositary will endeavor, insofar as practicable, to vote
the number of shares of Preferred Stock underlying such Depositary Shares in
accordance with such instructions, and the Company will agree to take all
reasonable action which nay he 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 Preferred Stock to the
extent it does not receive specific written instructions from holders of
Depositary Receipts representing such Preferred Stock.
RECORD DATE
Whenever (i) any cash dividend or other cash distribution shall become
payable, any distribution other than cash shall be made, or any rights,
preferences or privileges shall be offered with respect to the Preferred Stock,
or (ii) the Preferred Stock Depositary shall receive notice of any meeting at
which holders of Preferred Stock are entitled to vote or of which holders of
Preferred Stock are entitled to notice, or of the mandatory conversion of or any
election on the part of the Company to call for the redemption of any Preferred
Stock, the Preferred Stock Depositary shall in each such instance fix a record
date (which shall be the same as the record date for the Preferred Stock) for
the determination of the holders of Depositary Receipts (x) who shall be
entitled to receive such dividend, distribution, rights, preferences or
privileges or the net proceeds of the sale thereof or (y) who shall be entitled
to give instructions for the exercise of voting rights at any such meeting or to
receive notice of such meeting or of such redemption or conversion, subject to
the provisions of the Deposit Agreement.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt 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 which imposes or increases any fees,
taxes or other charges payable by the holders of Depositary Receipts (other than
taxes and other governmental charges, fees and other expenses payable by such
holders as slated under "Charges of Preferred Stock Depositary"), or which
otherwise prejudices any substantial existing right of holders of Depositary
Receipts, will not take effect as to outstanding Depositary Receipts until the
expiration of 90 days after notice of such amendment has been mailed to the
record holders of outstanding Depositary Receipts.
Whenever so directed by the Company, the Preferred Stock Depositary will
terminate the Deposit Agreement by mailing notice of such termination to the
record holders of all Depositary Receipts then outstanding at least 30 days
prior to the date fixed in such notice for such termination. The Preferred Stock
Depositary may likewise terminate the Deposit Agreement if at any time 45 days
shall have expired after the Preferred Stock Depositary shall have delivered to
the Company a written notice of its election to resign and a successor
depositary shall not have been appointed and accepted its appointment. If any
Depositary Receipts remain outstanding after the date of termination, the
Preferred Stock Depositary thereafter will discontinue the transfer of
Depositary Receipts, will suspend the distribution of dividends to the holders
thereof, and will not give any further notices (other than notice such
termination) or perform any further acts under the Deposit Agreement except as
provided below and except that the Preferred Stock Depositary will continue (i)
to collect dividends on the Preferred Stock and any other distributions with
respect thereto and (ii) to deliver the Preferred Stock together with such
dividends and distributions and the net proceeds of any sales of rights,
preferences, privileges or other property, without liability for interest
thereon, in exchange for Depositary Receipts surrendered. At any time after the
expiration of two years from the date of termination, the Preferred Stock
Depositary may sell the Preferred Stock then held by it at public or private
sales, at such
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<PAGE> 24
place or places and upon such terms as it deems proper and may thereafter hold
the net proceeds of any such sale, together with any money and other property
then held by it without liability for interest thereon, for the pro rata benefit
of the holders of Depositary Receipts which have not been surrendered.
CHARGES OF PREFERRED STOCK DEPOSITARY
The Company will pay all charges of the Preferred Stock Depositary
including charges in connection with the initial deposit of the Preferred Stock,
the initial issuance of the Depositary Receipts, the distribution of information
to the holders of Depositary Receipts with respect to matters on which Preferred
Stock is entitled to vote, withdrawals of the Preferred Stock by the holders of
Depositary Receipts or redemption or conversion of the Preferred Stock, except
for taxes (including transfer taxes, if any) and other governmental charges and
such other charges as are expressly provided in the Deposit Agreement to be at
the expense of holders of Depositary Receipts or persons depositing Preferred
Stock.
MISCELLANEOUS
Neither the Preferred Stock Depositary nor the Company will be liable if it
is prevented or delayed by law or any circumstance beyond its control in
performing its obligations under the Deposit Agreement. The obligations of the
Preferred Stock Depositary under the Deposit Agreement are limited to performing
its duties thereunder without negligence or bad faith. The obligations of the
Company under the Deposit Agreement are limited to performing its duties
thereunder in good faith. Neither the Company nor the Preferred Stock Depositary
is obligated to prosecute or defend any legal proceeding in respect of any
Depositary Shares or Preferred Stock unless satisfactory indemnity is furnished.
The Company and the Preferred Stock Depositary are entitled to rely upon advice
of or information from counsel, accountants or other persons believed to be
competent and on documents believed to be genuine.
The Preferred Stock Depositary may resign at any time or be removed by the
Company, effective upon the acceptance by its successor of its appointment;
provided, that if a successor Preferred Stock Depositary has not been appointed
or accepted such appointment within 45 days after the Preferred Stock Depositary
has delivered a notice of election to resign to the Company, the Preferred Stock
Depositary may terminate the Deposit Agreement. See "Amendment and Termination
of Deposit Agreement" above.
DESCRIPTION OF STOCK PURCHASE CONTRACTS
AND STOCK PURCHASE UNITS
The Company may issue Stock Purchase Contracts representing contracts
obligating holders to purchase from the Company and the Company to sell to the
holders a specified number of shares of Common Stock or Preferred Stock at a
future date or dates. The price per share of Common Stock or Preferred Stock may
be fixed at the time the Stock Purchase Contracts are issued or may be
determined by reference to a specific formula set forth in the Stock Purchase
Contracts. The Stock Purchase Contracts may be issued separately or as a part of
units ("Stock Purchase Units") consisting of a Stock Purchase Contract and
either (x) Senior Debt Securities, Subordinated Debt Securities (y) debt
obligations of third parties including U.S. Treasury securities, or (z)
Preferred Securities of a Phillips Capital Trust, securing the holder's
obligations to purchase the Common Stock or Preferred Stock under the Stock
Purchase Contracts. The Stock Purchase Contracts may require the Company to make
periodic payments to the holders of the Stock Purchase Units or vice versa, and
such payments may be unsecured or prefunded on some basis. The Stock Purchase
Contracts may require holders to secure their obligations thereunder in a
specified manner and in certain circumstances the Company may deliver newly
issued prepaid stock purchase contracts ("Prepaid Securities") upon release to a
holder of any collateral securing each holder's obligations under the original
Stock Purchase Contract.
The applicable Prospectus Supplement will describe the terms of any Stock
Purchase Contracts or Stock Purchase Units and, if applicable, Prepaid
Securities. The description in the Prospectus Supplement will not purport to be
complete and will be qualified in its entirety by reference to the Stock
Purchase Contracts, the collateral arrangements and depositary arrangements, if
applicable, relating to such Stock Purchase Contracts
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<PAGE> 25
or Stock Purchase Units and, if applicable, the Prepaid Securities and the
document pursuant to which such Prepaid Securities will be issued.
DESCRIPTION OF COMMON STOCK
The following summary does not purport to be complete and is subject in all
respects to the applicable provisions of the DGCL and the Charter.
General. The Company is authorized to issue up to 500,000,000 shares of
Common Stock. At December 31, 1997, the Company had outstanding 306,380,511
shares of Common Stock (including 14,000,882 shares held in its treasury) and
had reserved approximately 29,125,863 shares of Common Stock for issuance under
various employee or non-employee director incentive, compensation and option
plans and under the Company's Dividend Reinvestment Plan.
Dividends. Holders of Common Stock are entitled to receive dividends when,
as and if declared by the Board of Directors out of funds legally available
therefor, provided that, so long as any shares of preferred stock are
outstanding, no dividends (other than dividends payable in Common Stock) or
other distributions (including redemptions and purchases) may be made with
respect to the Common Stock unless full dividends on the shares of preferred
stock, including accumulations in the case of cumulative preferred stock, have
been paid.
Voting Rights. Subject to the rights, if any, of the holders of any series
of preferred stock, all voting rights are vested in the holders of shares of
Common Stock, each share being entitled to one vote on all matters presented for
a vote, including the election of directors. Holders of shares of Common Stock
have noncumulative voting rights, which means that the holders of more than 50
percent of the shares voting for the election of directors can elect 100 percent
of the directors, and, in such event, the holders of the remaining shares voting
for the election of directors will not be able to elect any directors.
Rights Upon Liquidation. In the event of the liquidation, dissolution or
winding up of the Company, whether voluntary or involuntary, after there have
been paid to or set aside for the holders of all series of preferred stock the
full preferential amounts to which such holders are entitled, the holders of
Common Stock will be entitled to share equally and ratably in any assets
remaining after the payment of all debts and liabilities of the Company.
Preferred Share Purchase Rights. The Company has outstanding one Preferred
Share Purchase Right ("Right") for each outstanding share of the Company's
Common Stock. Each Right entitles the registered holder to purchase from the
Company one one-hundredth of a share of Series B Junior Participating Preferred
Stock, par value $1.00 per share (the "Series B Preferred Stock"), of the
Company at a price of $75 per one one-hundredth of a share of Series B Preferred
Stock, subject to adjustment or to purchase shares of Common Stock or the stock
of an acquiring company at a discount in the event that any person or group of
affiliated persons acquires beneficial ownership of 20% or more of the Company's
outstanding Common Stock (an "Acquiring Person").
Shares of Series B Preferred Stock purchasable upon exercise of the Rights
will not be redeemable. Each share of Series B Preferred Stock will be entitled,
when, as and if declared, to a minimum preferential quarterly dividend payment
of $1 per share but will be entitled to an aggregate dividend of 100 times the
dividend declared per share of Common Stock. In the event of liquidation, the
holders of the Series B Preferred Stock will be entitled to a minimum
preferential liquidation payment of $100 per share (plus any accrued but unpaid
dividends) but will be entitled to an aggregate payment of 100 times the payment
made per share of Common Stock. Each share of Series B Preferred Stock will have
100 votes, voting together with the Common Stock. Finally, in the event of any
merger, consolidation or other transaction in which shares of Common Stock are
converted or exchanged, each share of Series B Preferred Stock will be entitled
to receive 100 times the amount received per share of Common Stock. These rights
are protected by customary antidilution provisions.
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<PAGE> 26
At any time prior to the time an Acquiring Person becomes such, the Board
of Directors of the Company may redeem the Rights in whole, but not in part, at
a price of $.01 per Right (the "Redemption Price"). The redemption of the Rights
may be made effective at such time, on such basis and with such conditions as
the Board of Directors in its sole discretion may establish. Immediately upon
any redemption of the Rights, the right to exercise the Rights will terminate
and the only right of the holders of Rights will be to receive the Redemption
Price.
For so long as the Rights are then redeemable, the Company may, except with
respect to the Redemption Price, amend the Rights in any manner. After the
Rights are no longer redeemable, the Company may, except with respect to the
Redemption Price, amend the Rights in any manner that does not adversely affect
the interests of holders of the Rights.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the right
to vote or to receive dividends.
Miscellaneous. The issued and outstanding shares of Common Stock are fully
paid and nonassessable. Holders of shares of Common Stock are not entitled to
preemptive rights. Shares of Common Stock are not convertible into shares of any
other class of capital stock. ChaseMellon Shareholder Services LLC is the
transfer agent, registrar and dividend disbursement agent for the Common Stock.
PLAN OF DISTRIBUTION
Phillips and/or a Phillips Capital Trust may sell the Offered Securities in
any of, or any combination of, the following ways: (i) directly to purchasers,
(ii) through agents, (iii) through underwriters, and (iv) through dealers.
Offers to purchase Offered Securities may be solicited directly by Phillips
and/or any Phillips Capital Trust, as the case may be, or by agents designated
by Phillips and/or any Phillips Capital Trust, as the case may be, from time to
time. Any such agent, who may be deemed to be an underwriter as that term is
defined in the Securities Act of 1933, involved in the offer or sale of the
Offered Securities in respect of which this Prospectus is delivered will be
named, and any commissions payable by Phillips to such agent will be set forth,
in the Prospectus Supplement. Unless otherwise indicated in the Prospectus
Supplement, any such agency will be acting in a best efforts basis for the
period of its appointment (ordinarily five business days or less). Agents,
dealers and underwriters may be customers of, engage in transactions with, or
perform services for the Company in the ordinary course of business.
If an underwriter or underwriters are utilized in the sale, Phillips will
execute an underwriting agreement with such underwriters at the time of sale to
them and the names of the underwriters and the terms of the transaction will be
set forth in the Prospectus Supplement, which will be used by the underwriters
to make releases of the Offered Securities in respect of which this Prospectus
is delivered to the public.
If a dealer is utilized in the sale of the Offered Securities in respect of
which this Prospectus is delivered, Phillips and/or any Phillips Capital Trust,
as the case may be, will sell such Offered Securities to the dealer, as
principal. The dealer may then resell such Offered Securities to the public at
varying prices to be determined by such dealer at the time of resale. The name
of the dealer and the terms of the transaction will be set forth in the
Prospectus Supplement.
Agents, underwriters, and dealers may be entitled under the relevant
agreements to indemnification by Phillips and/or any Phillips Capital Trust, as
the case may be, against certain liabilities, including liabilities under the
Securities Act of 1933.
The place and time of delivery for the Offered Securities in respect of
which this Prospectus is delivered are set forth in the accompanying Prospectus
Supplement.
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<PAGE> 27
LEGAL MATTERS
The validity of the Offered Securities (other than the Preferred
Securities) and certain matters relating thereto will be passed upon for
Phillips by Dale J. Billam, Senior Counsel of Phillips, and for the underwriters
and certain purchasers by Davis Polk & Wardwell. Certain matters of Delaware law
relating to the validity of the Preferred Securities will be passed upon on
behalf of the Phillips Capital Trusts by Morris, Nichols, Arsht & Tunnell,
special Delaware counsel to the Phillips Capital Trusts. Certain United States
federal income taxation matters, as required, will be passed upon for Phillips
and the Phillips Capital Trusts by Simpson Thacher & Bartlett, special tax
counsel to Phillips and the Phillips Capital Trusts.
EXPERTS
The consolidated financial statements and schedule of Phillips Petroleum
Company appearing in its Annual Report on Form 10-K for the year ended December
31, 1997, have been audited by Ernst & Young LLP, independent auditors, as set
forth in their report thereon included therein and incorporated herein by
reference. Such consolidated financial statements and schedule are incorporated
herein by reference in reliance upon such report given upon the authority of
such firm as experts in accounting and auditing.
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<PAGE> 28
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated expenses payable by the Company in connection with the
offering described in this Registration Statement (other than underwriting
discounts and commissions) are as follows:
<TABLE>
<S> <C>
SEC registration fee........................................ $206,500
Printing and engraving expenses............................. 25,000
Accounting fees and expenses................................ 25,000
Legal fees and expenses..................................... 25,000
Blue Sky fees and expenses.................................. 5,000
Trustee's expenses.......................................... 25,000
Fees of rating agencies..................................... 50,000
Miscellaneous............................................... 13,500
--------
Total............................................. $375,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Article III, section 14 of the Bylaws of the Company, as amended, provides
for indemnification of officers, directors and employees of the Company to the
extent authorized by the General Corporation Law of the State of Delaware.
Pursuant to Section 145 of the Delaware General Corporation Law, the Company
generally has the power to indemnify its present and former directors, officers,
employees and agents against expenses incurred by them in connection with any
suit to which they are, or are threatened to be made, a party by reason of their
serving in such positions so long as they acted in good faith and in a manner
they reasonably believed to be in, or not opposed to, the best interests of the
corporation, and with respect to any criminal action, they had no reasonable
cause to believe their conduct was unlawful. With respect to suits by or in the
right of a corporation, however, indemnification is not available if such person
is adjudged to be liable for negligence or misconduct in the performance of his
duty to the corporation unless the court determines that indemnification is
appropriate. In addition, the Company has the power to purchase and maintain
insurance for such persons. The statute also expressly provides that the power
to indemnify authorized thereby is not exclusive of any rights granted under any
bylaw, agreement, vote of stockholders or disinterested directors, or otherwise.
Pursuant to authority conferred by stockholders at the annual meeting of
the Company on April 30, 1987, the Company has entered into Indemnity Agreements
with each of its directors. The Indemnity Agreements establish contract rights
if favor of the Company's directors and thus give them assurances that the
indemnity provided would continue despite possible future changes or amendments
to the Company's Bylaws or the Restated Certificate of Incorporation. The
Indemnity Agreements generally provide that the directors are entitled to
indemnification to the fullest extent permitted by law against liabilities
arising from any claims made against them arising from acts or omissions alleged
to have been committed while acting as directors and solely because of their
being directors.
Also at the annual meeting of the Company on April 30, 1987, stockholders
approved an amendment to the Company's Restated Certificate of Incorporation to
eliminate the personal liability of each director of the Company to the Company
or its shareholders for monetary damages for breach of fiduciary duty under
certain circumstances. The amendment is consistent with amendments to the
Delaware General Corporation Law effective July 1, 1986.
In addition to the indemnification provision of the Company's Bylaws and
the Indemnity Agreements, the Company's directors and officers are covered by
Directors' and Officers' liability insurance with a limit of $200 million, which
insurance is subject to exclusions, deductibles and conditions.
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<PAGE> 29
The above discussion of the Company's Bylaws, Section 145 of the Delaware
General Corporation Law and the Company's Indemnity Agreements with its
directors is not intended to be exhaustive and is respectively qualified in its
entirety by such Bylaws, statute and Agreements.
ITEM 16. EXHIBITS
Exhibits identified in parentheses below are on file with the SEC and are
incorporated herein by reference to such previous filings.
<TABLE>
<C> <S>
1-A -- Form of Underwriting Agreement (Debt) (incorporated by
reference to Exhibit 1 to the Company's Registration
Statement No. 33-35859).
1-B* -- Form of Underwriting Agreement (Equity).
1-C -- Form of Underwriting Agreement (Preferred Securities)
(incorporated by reference to Exhibit 1 to the Company's
Registration Statement No. 333-01209).
1-D* -- Form of Underwriting Agreement (Stock Purchase
Contracts).
1-E* -- Form of Underwriting Agreement (Stock Purchase Units).
3-A -- Restated Certificate of Incorporation of Phillips
Petroleum Company. (incorporated by reference to Exhibit
3(i) to the Company's Annual Report on Form 10-K for the
year ended December 31, 1995.)
3-B* -- Certificate of Designation for Preferred Stock.
3-C -- Bylaws of Phillips Petroleum Company, as amended
effective July 14, 1997 (incorporated by reference to
Exhibit 3(ii) to the Company's Quarterly Report on Form
10-Q for the quarterly period ended June 30, 1997).
4-A -- Senior Debt Securities Indenture dated as of September
15, 1990, between Phillips Petroleum Company and U.S.
Bank Trust National Association, formerly First Trust
National Association (formerly Continental Bank, National
Association) (incorporated by reference to Exhibit 4(a)
to the Company's Annual Report on Form 10-K for the year
ended December 31, 1996).
4-B -- First Supplemental Senior Debt Securities Indenture dated
May 23, 1991, between Phillips Petroleum Company and U.S.
Bank Trust National Association, formerly First Trust
National Association (formerly Continental Bank, National
Association) (incorporated by reference to Exhibit 4(b)
to Annual Report on Form 10-K for the year ended December
31, 1997)
4-C -- Certificate of Trust of Phillips 66 Capital III
(incorporated by reference to Exhibit 4-C to the
Company's Registration Statement No. 333-01209).
4-D -- Certificate of Trust of Phillips 66 Capital IV
(incorporated by reference to Exhibit 4-D to the
Company's Registration Statement No. 333-01209).
4-E** -- Certificate of Trust of Phillips 66 Capital V.
4-F** -- Certificate of Trust of Phillips 66 Capital VI.
4-G -- Declaration of Trust of Phillips 66 Capital III
(incorporated by reference to Exhibit 4-G to the
Company's Registration Statement No. 333-01209).
4-H -- Declaration of Trust of Phillips 66 Capital IV
(incorporated by reference to Exhibit 4-H to the
Company's Registration Statement No. 333-01209).
4-I** -- Declaration of Trust of Phillips 66 Capital V.
4-J** -- Declaration of Trust of Phillips 66 Capital VI.
4-K -- Form of Amended and Restated Declaration of Trust for
Phillips 66 Capital III (incorporated by reference to
Exhibit 4-K to Amendment No. 1 to the Company's
Registration Statement on (No. 333-01209)).
</TABLE>
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<PAGE> 30
<TABLE>
<C> <S>
4-L -- Form of Amended and Restated Declaration of Trust for
Phillips 66 Capital IV (incorporated by reference to
Exhibit 4-L to Amendment No. 1 to the Company's
Registration Statement (No. 333-01209)).
4-M** -- Form of Amended and Restated Declaration of Trust for
Phillips 66 Capital V.
4-N** -- Form of Amended and Restated Declaration of Trust for
Phillips 66 Capital VI.
4-O -- Form of Indenture between Phillips Petroleum Company and
The Bank of New York, as Trustee dated as of May 23, 1996
(incorporated by reference to Exhibit 4-C to the
Company's Registration Statement No. 333-01209).
4-P -- Form of Supplemental Indenture to be used in connection
with the issuance of Subordinated Debt Securities and
Preferred Securities (incorporated by reference to
Exhibit 4-N to the Company's Registration Statement No.
333-01209).
4-Q -- Form of Preferred Security (included in 4-H - 4-K above).
4-R -- Form of Subordinated Debt Security (included in 4-P
above).
4-S -- Form of Guarantee with respect to Preferred Securities
issued by Phillips 66 Capital III. (incorporated by
reference to Exhibit 4-S to Amendment No. 1 to the
Company's Registration Statement (No. 333-01209)).
4-T -- Form of Guarantee with respect to Preferred Securities
issued by Phillips 66 Capital IV (incorporated by
reference to Exhibit 4-T to Amendment No. 1 to the
Company's Registration Statement (No. 333-01209)).
4-U** -- Form of Guarantee with respect to Preferred Securities
issued by Phillips 66 Capital V.
4-V** -- Form of Guarantee with respect to Preferred Securities
issued by Phillips 66 Capital VI.
4-W -- Preferred Share Purchase Rights as described in the
Rights Agreement dated as of July 10, 1989, between
Phillips Petroleum Company and The Chase Manhattan Bank
(formerly Chemical Bank) (incorporated by reference to
Exhibit 4(c) to the Company's Annual Report on Form 10-K
for the year ended December 31, 1995).
4-X -- First Amendment dated May 16, 1990, to the Rights
Agreement dated July 10, 1989, between Phillips Petroleum
Company and The Chase Manhattan Bank (formerly Chemical
Bank) (incorporated by reference to Exhibit 4(d) to
Annual Report on Form 10-K for the year ended December
31, 1996).
4-Y* -- Form of Supplemental Indenture to be used in connection
with the issuance of Subordinated Debt Securities
Convertible into Common Stock.
4-Z* -- Form of Deposit Agreement for depository shares.
4-AA* -- Form of Common Stock share certificate.
4-BB* -- Form of Preferred Stock share certificate.
4-CC* -- Form of Purchase Contract Agreement relating to Stock
Purchase Contracts and Stock Purchase Units.
4-DD* -- Form of Pledge Agreement for Stock Purchase Contracts and
Stock Purchase Units
5-A** -- Opinion of Dale J. Billam, Esq.
5-B** -- Opinion of Morris, Nichols, Arsht & Tunnell.
8-A* -- Opinion of Simpson Thacher & Bartlett.
12 -- Computation of Ratios of Earnings to Fixed Charges and
Earnings to Combined Fixed Charges and Preferred Stock
Dividends of Phillips Petroleum Company (incorporated by
reference to Exhibit 12 to the Company's Quarterly Report
on Form 10-Q for the quarter ended March 31, 1998, and
Exhibit 12 to the Company's Annual Report on Form 10-K
for the year ended December 31, 1997)
23-A** -- Consent of Independent Auditors.
23-B -- Consent of Dale J. Billam, Esq. is contained in the
opinion of counsel filed as Exhibit 5-A.
</TABLE>
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<PAGE> 31
<TABLE>
<C> <S>
23-C -- Consent of Morris, Nichols, Arsht, & Tunnell is contained
in the opinion of counsel filed as Exhibit 5-B.
23-D -- Consent of Simpson Thacher & Bartlett will be contained
in the opinion of counsel to be filed if required as
Exhibit 8-A.
24** -- Powers of Attorney.
25-A** -- Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of U.S. Bank Trust National
Association, as Trustee under the Senior Debt Securities
Indenture.
25-B** -- Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Property
Trustee under the Amended and Restated Declaration of
Trust of Phillips 66 Capital III.
25-C** -- Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Property
Trustee under the Amended and Restated Declaration of
Trust of Phillips 66 IV.
25-D** -- Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Property
Trustee under the Amended and Restated Declaration of
Trust of Phillips 66 V.
25-E** -- Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Property
Trustee under the Amended and Restated Declaration of
Trust of Phillips 66 VI.
25-F** -- Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Preferred
Guarantee Trustee under the Preferred Securities
Guarantee of Phillips Petroleum Company for the benefit
of the holders of Preferred Securities of Phillips 66
Capital III.
25-G** -- Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Preferred
Guarantee Trustee under the Preferred Securities
Guarantee of Phillips Petroleum Company for the benefit
of the holders of Preferred Securities of Phillips 66
Capital IV.
25-H** -- Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Preferred
Guarantee Trustee under the Preferred Securities
Guarantee of Phillips Petroleum Company for the benefit
of the holders of Preferred Securities of Phillips 66
Capital V.
25-I** -- Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Preferred
Guarantee Trustee under the Preferred Securities
Guarantee of Phillips Petroleum Company for the benefit
of the holders of Preferred Securities of Phillips 66
Capital VI.
25-J** -- Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Debt
Trustee under the Subordinated Debt Securities Indenture.
</TABLE>
- ---------------
* To be filed with subsequent Current Report on Form 8-K
** Filed herewith
ITEM 17. UNDERTAKINGS
(a) The undersigned Registrants hereby undertake:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement: (i) To
include any prospectus required by Section 10(a)(3) of the Securities Act
of 1933, as amended (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
II-4
<PAGE> 32
information set forth in the 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 (a)(1)(i) and (a)(1)(ii) above
do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by the Company pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934, as amended (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.
(b) The undersigned Registrants hereby undertake that, for purposes of
determining any liability under the Securities Act, each filing of the Companies
annual report pursuant to Section 13(a) or Section 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 this Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrants pursuant to the foregoing provisions, or otherwise, the Registrants
have been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrants of expenses
incurred or paid by a director, officer or controlling person of the Registrants
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrants will, unless in the opinion of their counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by them is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
(d) The undersigned Registrants hereby undertake that:
(1) For purposes of determining any liability under the Securities act
of 1933, the information contained in a form of prospectus filed by the
Registrants pursuant to Rule 424(b)(1) or (4) or 497(h) under the
Securities Act shall be deemed to be part of this Registration Statement as
of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-5
<PAGE> 33
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Phillips
Petroleum Company 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 or amendment thereto to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Bartlesville and State of
Oklahoma on May 22, 1998.
PHILLIPS PETROLEUM COMPANY
By /s/ W.W. ALLEN
-----------------------------------
W.W. Allen
Chairman of the Board of Directors
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement or amendment thereto has been signed below by the
following persons in the capacities indicated on May 22, 1998.
<TABLE>
<CAPTION>
SIGNATURES TITLE DATE
---------- ----- ----
<C> <S> <C>
/s/ W.W. ALLEN Chairman of the Board of May 22, 1998
- ----------------------------------------------------- Directors and Chief Executive
(W.W. Allen) Officer (Principal Executive
Officer)
/s/ T.C. MORRIS Senior Vice President and Chief May 22, 1998
- ----------------------------------------------------- Financial Officer (Principal
(T.C. Morris) Financial Officer)
/s/ RAND C. BERNEY Vice President and Controller May 22, 1998
- ----------------------------------------------------- (Principal Accounting Officer)
(Rand C. Berney)
/s/ J.J. MULVA President and Chief Operating May 22, 1998
- ----------------------------------------------------- Officer and Director
(J.J. Mulva)
NORMAN R. AUGUSTINE* Director May 22, 1998
- -----------------------------------------------------
(Norman R. Augustine)
C.L. BOWERMAN* Executive Vice President and May 22, 1998
- ----------------------------------------------------- Director
(C.L. Bowerman)
GEORGE B. BEITZEL* Director May 22, 1998
- -----------------------------------------------------
(George B. Beitzel)
DAVID L. BOREN* Director May 22, 1998
- -----------------------------------------------------
(David L. Boren)
</TABLE>
II-6
<PAGE> 34
<TABLE>
<CAPTION>
SIGNATURES TITLE DATE
---------- ----- ----
<C> <S> <C>
ROBERT E. CHAPPELL, JR.* Director May 22, 1998
- -----------------------------------------------------
(Robert E. Chappell, Jr.)
LAWRENCE S. EAGLEBURGER* Director May 22, 1998
- -----------------------------------------------------
(Lawrence S. Eagleburger)
LARRY D. HORNER* Director May 22, 1998
- -----------------------------------------------------
(Larry D. Horner)
RANDALL L. TOBIAS* Director May 22, 1998
- -----------------------------------------------------
(Randall L. Tobias)
VICTORIA J. TSCHINKEL* Director May 22, 1998
- -----------------------------------------------------
(Victoria J. Tschinkel)
KATHRYN C. TURNER* Director May 22, 1998
- -----------------------------------------------------
(Kathryn C. Turner)
*By /s/ JOHN A. CARRIG
-------------------------------------------------
John A. Carrig, Attorney-in-fact
</TABLE>
II-7
<PAGE> 35
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Phillips 66
Capital III, Phillips 66 Capital IV, Phillips 66 Capital V and Phillips 66
Capital VI certify that they have reasonable grounds to believe that they meet
all of the requirements for filing on Form S-3 and that they have duly caused
this Registration Statement or amendment thereto to be signed on their behalf by
the undersigned, thereunto duly authorized, in the City of Bartlesville and
State of Oklahoma on May 22, 1998.
PHILLIPS 66 CAPITAL III
By: /s/ T.C. MORRIS
----------------------------------
T.C. Morris, Trustee
By: /s/ JOHN A. CARRIG
----------------------------------
John A. Carrig, Trustee
By: /s/ R.B. GISI
----------------------------------
R.B. Gisi, Trustee
PHILLIPS 66 CAPITAL IV
By: /s/ T.C. MORRIS
----------------------------------
T.C. Morris, Trustee
By: /s/ JOHN A. CARRIG
----------------------------------
John A. Carrig, Trustee
By: /s/ R.B. GISI
----------------------------------
R.B. Gisi, Trustee
PHILLIPS 66 CAPITAL V
By: /s/ T.C. MORRIS
----------------------------------
T.C. Morris, Trustee
By: /s/ JOHN A. CARRIG
----------------------------------
John A. Carrig, Trustee
By: /s/ R.B. GISI
----------------------------------
R.B. Gisi, Trustee
II-8
<PAGE> 36
PHILLIPS 66 CAPITAL VI
By: /s/ T.C. MORRIS
--------------------------------
T.C. Morris, Trustee
By: /s/ JOHN A. CARRIG
----------------------------------
John A. Carrig, Trustee
By: /s/ R.B. GISI
----------------------------------
R.B. Gisi, Trustee
II-9
<PAGE> 37
INDEX TO EXHIBITS
<TABLE>
<C> <S>
1-A -- Form of Underwriting Agreement (Debt) (incorporated by
reference to Exhibit 1 to the Company's Registration
Statement No. 33-35859).
1-B* -- Form of Underwriting Agreement (Equity).
1-C -- Form of Underwriting Agreement (Preferred Securities)
(incorporated by reference to Exhibit 1 to the Company's
Registration Statement No. 333-01209).
1-D* -- Form of Underwriting Agreement (Stock Purchase
Contracts).
1-E* -- Form of Underwriting Agreement (Stock Purchase Units).
3-A -- Restated Certificate of Incorporation of Phillips
Petroleum Company. (incorporated by reference to Exhibit
3(i) to the Company's Annual Report on Form 10-K for the
year ended December 31, 1995.)
3-B* -- Certificate of Designation for Preferred Stock.
3-C -- Bylaws of Phillips Petroleum Company, as amended
effective July 14, 1997 (incorporated by reference to
Exhibit 3(ii) to the Company's Quarterly Report on Form
10-Q for the quarterly period ended June 30, 1997).
4-A -- Senior Debt Securities Indenture dated as of September
15, 1990, between Phillips Petroleum Company and U.S.
Bank Trust National Association, formerly First Trust
National Association (formerly Continental Bank, National
Association) (incorporated by reference to Exhibit 4(a)
to the Company's Annual Report on Form 10-K for the year
ended December 31, 1996).
4-B -- First Supplemental Senior Debt Securities Indenture dated
May 23, 1991, between Phillips Petroleum Company and U.S.
Bank Trust National Association, formerly First Trust
National Association (formerly Continental Bank, National
Association) (incorporated by reference to Exhibit 4(b)
to Annual Report on Form 10-K for the year ended December
31, 1997)
4-C -- Certificate of Trust of Phillips 66 Capital III
(incorporated by reference to Exhibit 4-C to the
Company's Registration Statement No. 333-01209).
4-D -- Certificate of Trust of Phillips 66 Capital IV
(incorporated by reference to Exhibit 4-D to the
Company's Registration Statement No. 333-01209).
4-E** -- Certificate of Trust of Phillips 66 Capital V.
4-F** -- Certificate of Trust of Phillips 66 Capital VI.
4-G -- Declaration of Trust of Phillips 66 Capital III
(incorporated by reference to Exhibit 4-G to the
Company's Registration Statement No. 333-01209).
4-H -- Declaration of Trust of Phillips 66 Capital IV
(incorporated by reference to Exhibit 4-H to the
Company's Registration Statement No. 333-01209).
4-I** -- Declaration of Trust of Phillips 66 Capital V.
4-J** -- Declaration of Trust of Phillips 66 Capital VI.
4-K -- Form of Amended and Restated Declaration of Trust for
Phillips 66 Capital III (incorporated by reference to
Exhibit 4-K to Amendment No. 1 to the Company's
Registration Statement on (No. 333-01209)).
4-L -- Form of Amended and Restated Declaration of Trust for
Phillips 66 Capital IV (incorporated by reference to
Exhibit 4-L to Amendment No. 1 to the Company's
Registration Statement (No. 333-01209)).
4-M** -- Form of Amended and Restated Declaration of Trust for
Phillips 66 Capital V.
4-N** -- Form of Amended and Restated Declaration of Trust for
Phillips 66 Capital VI.
</TABLE>
<PAGE> 38
<TABLE>
<C> <S>
4-O -- Form of Indenture between Phillips Petroleum Company and
The Bank of New York, as Trustee dated as of May 23, 1996
(incorporated by reference to Exhibit 4-C to the
Company's Registration Statement No. 333-01209).
4-P -- Form of Supplemental Indenture to be used in connection
with the issuance of Subordinated Debt Securities and
Preferred Securities (incorporated by reference to
Exhibit 4-N to the Company's Registration Statement No.
333-01209).
4-Q -- Form of Preferred Security (included in 4-H - 4-K above).
4-R -- Form of Subordinated Debt Security (included in 4-P
above).
4-S -- Form of Guarantee with respect to Preferred Securities
issued by Phillips 66 Capital III. (incorporated by
reference to Exhibit 4-S to Amendment No. 1 to the
Company's Registration Statement (No. 333-01209)).
4-T -- Form of Guarantee with respect to Preferred Securities
issued by Phillips 66 Capital IV (incorporated by
reference to Exhibit 4-T to Amendment No. 1 to the
Company's Registration Statement (No. 333-01209)).
4-U** -- Form of Guarantee with respect to Preferred Securities
issued by Phillips 66 Capital V.
4-V** -- Form of Guarantee with respect to Preferred Securities
issued by Phillips 66 Capital VI.
4-W -- Preferred Share Purchase Rights as described in the
Rights Agreement dated as of July 10, 1989, between
Phillips Petroleum Company and The Chase Manhattan Bank
(formerly Chemical Bank) (incorporated by reference to
Exhibit 4(c) to the Company's Annual Report on Form 10-K
for the year ended December 31, 1995).
4-X -- First Amendment dated May 16, 1990, to the Rights
Agreement dated July 10, 1989, between Phillips Petroleum
Company and The Chase Manhattan Bank (formerly Chemical
Bank) (incorporated by reference to Exhibit 4(d) to
Annual Report on Form 10-K for the year ended December
31, 1996).
4-Y* -- Form of Supplemental Indenture to be used in connection
with the issuance of Subordinated Debt Securities
Convertible into Common Stock.
4-Z* -- Form of Deposit Agreement for depository shares.
4-AA* -- Form of Common Stock share certificate.
4-BB* -- Form of Preferred Stock share certificate.
4-CC* -- Form of Purchase Contract Agreement relating to Stock
Purchase Contracts and Stock Purchase Units.
4-DD* -- Form of Pledge Agreement for Stock Purchase Contracts and
Stock Purchase Units
5-A** -- Opinion of Dale J. Billam, Esq.
5-B** -- Opinion of Morris, Nichols, Arsht & Tunnell.
8-A* -- Opinion of Simpson Thacher & Bartlett.
12** -- Computation of Ratios of Earnings to Fixed Charges and
Earnings to Combined Fixed Charges and Preferred Stock
Dividends of Phillips Petroleum Company (incorporated by
reference to Exhibit 12 to the Company's Quarterly Report
on Form 10-Q for the quarter ended March 31, 1998, and
Exhibit 12 to the Company's Annual Report on Form 10-K
for the year ended December 31, 1997)
23-A** -- Consent of Independent Auditors.
23-B -- Consent of Dale J. Billam, Esq. is contained in the
opinion of counsel filed as Exhibit 5-A.
23-C -- Consent of Morris, Nichols, Arsht, & Tunnell is contained
in the opinion of counsel filed as Exhibit 5-B.
23-D -- Consent of Simpson Thacher & Bartlett will be contained
in the opinion of counsel to be filed if required as
Exhibit 8-A.
24** -- Powers of Attorney.
</TABLE>
<PAGE> 39
<TABLE>
<C> <S>
25-A** -- Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of U.S. Bank
Trust National Association, as Trustee under the Senior Debt Securities Indenture.
25-B** -- Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Bank of
New York, as Property Trustee under the Amended and Restated Declaration of Trust of Phillips
66 Capital III.
25-C** -- Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Bank of
New York, as Property Trustee under the Amended and Restated Declaration of Trust of Phillips
66 IV.
25-D** -- Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Bank of
New York, as Property Trustee under the Amended and Restated Declaration of Trust of Phillips
66 V.
25-E** -- Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Bank of
New York, as Property Trustee under the Amended and Restated Declaration of Trust of Phillips
66 VI.
25-F** -- Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Bank of
New York, as Preferred Guarantee Trustee under the Preferred Securities Guarantee of Phillips
Petroleum Company for the benefit of the holders of Preferred Securities of Phillips 66
Capital III.
25-G** -- Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Bank of
New York, as Preferred Guarantee Trustee under the Preferred Securities Guarantee of Phillips
Petroleum Company for the benefit of the holders of Preferred Securities of Phillips 66
Capital IV.
25-H** -- Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Bank of
New York, as Preferred Guarantee Trustee under the Preferred Securities Guarantee of Phillips
Petroleum Company for the benefit of the holders of Preferred Securities of Phillips 66
Capital V.
25-I** -- Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Bank of
New York, as Preferred Guarantee Trustee under the Preferred Securities Guarantee of Phillips
Petroleum Company for the benefit of the holders of Preferred Securities of Phillips 66
Capital VI.
25-J** -- Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Bank of
New York, as Debt Trustee under the Subordinated Debt Securities Indenture.
</TABLE>
- ---------------
* To be filed with subsequent Current Report on Form 8-K
** Filed herewith
<PAGE> 1
EXHIBIT 4-E
CERTIFICATE OF TRUST
The undersigned, the trustees of Phillips 66 Capital V,
desiring to form a business trust pursuant to Section 3810 of the Delaware
Business Trust Act, 12 Del. C. Section 3810, hereby certify as follows:
(a) The name of the business trust being formed hereby
(the "Trust") is "Phillips 66 Capital V".
(b) The name and business address of the trustee of the
Trust which has its principal place of business in
the State of Delaware is as follows:
The Bank of New York (Delaware)
White Clay Center, Route 273
Newark, Delaware 19711
(c) This Certificate of Trust shall be effective as of
the date of filing.
Dated: May 22, 1998
/s/ T.C. Morris
---------------------------------------
Name: T.C. Morris
Title: Trustee
/s/ John A. Carrig
---------------------------------------
Name: John A. Carrig
Title: Trustee
/s/ R.B. Gisi
---------------------------------------
Name: R.B. Gisi
Title: Trustee
THE BANK OF NEW YORK (DELAWARE), as
Trustee
By: /s/ Mary Jane Morrissey
------------------------------------
Name: Mary Jane Morrissey
Title: Authorized Signatory
<PAGE> 1
EXHIBIT 4-F
CERTIFICATE OF TRUST
The undersigned, the trustees of Phillips 66 Capital VI,
desiring to form a business trust pursuant to Section 3810 of the Delaware
Business Trust Act, 12 Del. C. Section 3810, hereby certify as follows:
(a) The name of the business trust being formed hereby
(the "Trust") is "Phillips 66 Capital VI".
(b) The name and business address of the trustee of the
Trust which has its principal place of business in
the State of Delaware is as follows:
The Bank of New York (Delaware)
White Clay Center, Route 273
Newark, Delaware 19711
(c) This Certificate of Trust shall be effective as of
the date of filing.
Dated: May 22, 1998
/s/ T.C. Morris
--------------------------------------
Name: T.C. Morris
Title: Trustee
/s/ John A. Carrig
--------------------------------------
Name: John A. Carrig
Title: Trustee
/s/ R.B. Gisi
--------------------------------------
Name: R.B. Gisi
Title: Trustee
THE BANK OF NEW YORK (DELAWARE), as
Trustee
By: /s/ Mary Jane Morrissey
-----------------------------------
Name: Mary Jane Morrissey
Title: Authorized Signatory
<PAGE> 1
EXHIBIT 4-I
================================
DECLARATION OF TRUST
Phillips 66 Capital V
Dated as of May 22, 1998
================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
ARTICLE I DEFINITIONS.............................................................................................1
Section 1.1 Definitions...................................................................................1
ARTICLE II ORGANIZATION...........................................................................................3
Section 2.1 Name..........................................................................................3
Section 2.2 Office........................................................................................3
Section 2.3 Purpose.......................................................................................3
Section 2.4 Authority.....................................................................................4
Section 2.5 Title to Property of the Trust................................................................4
Section 2.6 Powers of the Trustees........................................................................4
Section 2.7 Filing of Certificate of Trust................................................................5
Section 2.8 Duration of Trust.............................................................................5
Section 2.9 Responsibilities of the Sponsor...............................................................5
Section 2.10 Declaration Binding on Securities Holders.....................................................6
ARTICLE III TRUSTEES..............................................................................................6
Section 3.1 Trustees......................................................................................6
Section 3.2 Regular Trustees..............................................................................6
Section 3.3 Delaware Trustee..............................................................................7
Section 3.4 Property Trustee..............................................................................7
Section 3.5 Not Responsible for Recitals or Sufficiency of Declaration....................................7
ARTICLE IV LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR OTHERS..................................8
Section 4.1 Exculpation...................................................................................8
Section 4.2 Fiduciary Duty................................................................................8
Section 4.3 Indemnification...............................................................................9
Section 4.4 Outside Businesses...........................................................................12
ARTICLE V AMENDMENTS, TERMINATION, MISCELLANEOUS.................................................................12
Section 5.1 Amendments...................................................................................12
Section 5.2 Termination of Trust.........................................................................12
Section 5.3 Governing Law................................................................................13
Section 5.4 Headings.....................................................................................13
Section 5.5 Successors and Assigns.......................................................................13
Section 5.6 Partial Enforceability.......................................................................13
Section 5.7 Counterparts.................................................................................13
</TABLE>
<PAGE> 3
DECLARATION OF TRUST
OF
Phillips 66 Capital V
May 22, 1998
DECLARATION OF TRUST ("Declaration") dated and effective as of
May 22, 1998 by the Trustees (as defined herein), the Sponsor (as defined
herein), and by the holders, from time to time, of undivided beneficial
interests in the Trust to be issued pursuant to this Declaration;
WHEREAS, the Trustees and the Sponsor desire to establish a
trust (the "Trust") pursuant to the Delaware Business Trust Act for the sole
purpose of issuing and selling certain securities representing undivided
beneficial interests in the assets of the Trust and investing the proceeds
thereof in certain Debentures of the Debenture Issuer; and
NOW, THEREFORE, it being the intention of the parties hereto
that the Trust constitute a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will beheld in trust
for the exclusive benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.
ARTICLE I
DEFINITIONS
Section 1.1 Definitions
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration but not
defined in the preamble above have the respective
meanings assigned to them in this Section 1.1;
(b) a term defined anywhere in this Declaration has the same
meaning throughout;
(c) all references to "the Declaration" or "this
Declaration" are to this Declaration of Trust as
modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and
Sections are to Articles and Sections of this
Declaration unless otherwise specified; and
(e) a reference to the singular includes the plural and vice
versa.
- 1 -
<PAGE> 4
"Affiliate" has the same meaning as given to that term in
Rule 405 of the Securities Act or any successor rule thereunder.
"Business Day" means any day other than a day on which banking
institutions in New York, New York are authorized or required by law to close.
"Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801 et seq., as it may be amended from time
to time, or any successor legislation.
"Commission" means the Securities and Exchange Commission.
"Common Security" means a security representing an undivided
beneficial interest in the assets of the Trust with such terms as may be setout
in any amendment to this Declaration.
"Company Indemnified Person" means (a) any Regular Trustee;(b)
any Affiliate of any Regular Trustee; (c) any officers, directors, shareholders,
members, partners, employees, representatives or agents of any Regular Trustee;
or (d) any employee or agent of the Trust or its Affiliates.
"Covered Person" means (a) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or (ii) the
Trust's Affiliates and (b) any holder of Securities.
"Debenture Issuer" means the Parent in its capacity as the
issuer of the Debentures under the Indenture.
"Debentures" means the series of Debentures to be issued by
the Debenture Issuer and acquired by the Trust.
"Debenture Trustee" means [The Bank of New York, a New York
banking corporation], as trustee under the Indenture until a successor is
appointed thereunder, and thereafter means such successor trustee.
"Delaware Trustee" has the meaning set forth in Section 3.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time or any successor legislation.
"Fiduciary Indemnified Person" has the meaning set forth in
Section 4.3(b).
"Indemnified Person" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the indenture to be entered into between the
Parent and the Debenture Trustee and any indenture supplemental thereto pursuant
to which the Debentures are to be issued.
- 2 -
<PAGE> 5
"Parent" means Phillips Petroleum Company, a Delaware
corporation or any successor entity in a merger.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Preferred Security" means a security representing an
undivided beneficial interest in the assets of the Trust with such terms as
maybe set out in any amendment to this Declaration.
"Regular Trustee" means any Trustee other than the Delaware
Trustee and the Institutional Trustee (as hereinafter defined).
"Securities" means the Common Securities and the Preferred
Securities.
"Securities Act" means the Securities Act of 1933, as amended
from time to time, or any successor legislation.
"Sponsor" means the Parent in its capacity as sponsor of the
Trust.
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with the
provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
ARTICLE II
ORGANIZATION
Section 2.1 Name.
The Trust created by this Declaration is named "Phillips
66 Capital V." The Trust's activities may be conducted under the name of the
Trust or any other name deemed advisable by the Regular Trustees.
Section 2.2 Office
The address of the principal office of the Trust is c/o
Phillips Petroleum Company, Phillips Building, Bartlesville, Oklahoma 74004. At
any time, the Regular Trustees may designate another principal office.
Section 2.3 Purpose
The exclusive purposes and functions of the Trust are (a) to
issue and sell Securities and use the proceeds from such sale to acquire the
Debentures, and (b) except as
- 3 -
<PAGE> 6
otherwise limited herein, to engage in only those other activities necessary, or
incidental thereto. The Trust shall not borrow money, issue debt or reinvest
proceeds derived from investments, pledge any of its assets, or otherwise
undertake (or permit to be undertaken) any activity that would cause the Trust
not to be classified for United States federal income tax purposes as a grantor
trust.
Section 2.4 Authority
Subject to the limitations provided in this Declaration, the
Regular Trustees shall have exclusive and complete authority to carry out the
purposes of the Trust. An action taken by the Regular Trustees in accordance
with their powers shall constitute the act of and serve to bind the Trust. In
dealing with the Regular Trustees acting on behalf of the Trust, no person shall
be required to inquire into the authority of the Regular Trustees to bind the
Trust. Persons dealing with the Trust are entitled to rely conclusively on the
power and authority of the Regular Trustees as set forth in this Declaration.
Section 2.5 Title to Property of the Trust
Legal title to all assets of the Trust shall be vested in the
Trust.
Section 2.6 Powers of the Trustees
The Regular Trustees shall have the exclusive power and
authority to cause the Trust to engage in the following activities:
(a) to issue and sell the Preferred Securities and the
Common Securities in accordance with this Declaration; provided, however, that
the Trust may issue no more than one series of Preferred Securities and no more
than one series of Common Securities, and, provided further, that there shall be
no interests in the Trust other than the Securities and the issuance of the
Securities shall be limited to a one-time, simultaneous issuance of both
Preferred Securities and Common Securities;
(b) in connection with the issue and sale of the
Preferred Securities, at the direction of the Sponsor, to:
(i)execute and file with the Commission a
registration statement on Form S-3 prepared by the
Sponsor, including any amendments thereto in relation
to the Preferred Securities;
(ii) execute and file any documents prepared by the
Sponsor, or take any acts as determined by the Sponsor
to be necessary in order to qualify or register all or
part of the Preferred Securities in any State in which
the Sponsor has determined to qualify or register such
Preferred Securities for sale;
(iii) execute and file an application, prepared by
the Sponsor, to the New York Stock Exchange or any
other national stock exchange or
- 4 -
<PAGE> 7
the Nasdaq Stock Market's National Market for listing
upon notice of issuance of any Preferred Securities;
(iv) execute and file with the Commission a
registration statement on Form 8-A, including any
amendments thereto, prepared by the Sponsor relating to
the registration of the Preferred Securities under
Section 12(b) of the Exchange Act; and
(v) execute and enter into an underwriting
agreement and pricing agreement providing for the sale
of the Preferred Securities;
(c) to employ or otherwise engage employees and agents
(who may be designated as officers with titles) and managers,
contractors, advisors, and consultants and provide for
reasonable compensation for such services;
(d) to incur expenses which are necessary or incidental
to carry out any of the purposes of this Declaration; and
(e) to execute all documents or instruments, perform
all duties and powers, and do all things for and on behalf of
the Trust in all matters necessary or incidental to the
foregoing.
Section 2.7 Filing of Certificate of Trust
On or after the date of execution of this Declaration, the
Trustees shall cause the filing of the Certificate of Trust for the Trust in the
form attached hereto as Exhibit A with the Secretary of State of the State of
Delaware.
Section 2.8 Duration of Trust
The Trust, absent termination pursuant to the provisions of
Section 5.2, shall have existence for fifty-five (55) years from the date
hereof.
Section 2.9 Responsibilities of the Sponsor
In connection with the issue and sale of the Preferred
Securities, the Sponsor shall have the exclusive right and responsibility to
engage in the following activities:
(a) to prepare for filing by the Trust with the
Commission a registration statement on Form S-3 in relation to the Preferred
Securities, including any amendments thereto;
(b) to determine the States in which to take
appropriate action to qualify or register for sale all or part of the Preferred
Securities and to do any and all such acts, other than actions which must be
taken by the Trust, and advise the Trust of actions it must take, and prepare
for execution and filing any documents to be executed and filed by the Trust, as
the
- 5 -
<PAGE> 8
Sponsor deems necessary or advisable in order to comply with the applicable
laws of any such States;
(c) to prepare for filing by the Trust an application
to the New York Stock Exchange or any other national stock exchange or the
Nasdaq National Market for listing upon notice of issuance of any Preferred
Securities;
(d) to prepare for filing by the Trust with the
Commission a registration statement on Form 8-A relating to the registration of
the class of Preferred Securities under Section 12(b) of the Exchange Act,
including any amendments thereto; and
(e) to negotiate the terms of an underwriting agreement
and pricing agreement providing for the sale of the Preferred Securities.
Section 2.10 Declaration Binding on Securities Holders
Every Person by virtue of having become a holder of a Security
or any interest therein in accordance with the terms of this Declaration, shall
be deemed to have expressly assented and agreed to the terms of, and shall be
bound by, this Declaration.
ARTICLE III
TRUSTEES
Section 3.1 Trustees
The number of Trustees initially shall be four (4), and
thereafter the number of Trustees shall be such number as shall be fixed from
time to time by a written instrument signed by the Sponsor. The Sponsor is
entitled to appoint or remove without cause any Trustee at any time; provided,
however, that the number of Trustees shall in no event be less than two
(2);provided further that one Trustee, in the case of a natural person, shall be
a person who is a resident of the State of Delaware or that, if not a natural
person, is an entity which has its principal place of business in the State of
Delaware (the "Delaware Trustee"); provided further that there shall be at least
one trustee who is an employee or officer of, or is affiliated with the Parent
(a "Regular Trustee").
Section 3.2 Regular Trustees
The initial Regular Trustees shall be:
T.C. Morris
John A. Carrig
R.B. Gisi
(a) Except as expressly set forth in this Declaration,
any power of the Regular Trustees may be exercised by, or with the consent of,
anyone such Regular Trustee.
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<PAGE> 9
(b) Unless otherwise determined by the Regular
Trustees, and except as otherwise required by the Business Trust Act, any
Regular Trustee is authorized to execute on behalf of the Trust any documents
which the Regular Trustees have the power and authority to cause the Trust to
execute pursuant to Section 2.6 provided, that, the registration statement
referred to in Section 2.6(b)(i), including any amendments thereto, shall be
signed by a majority of the Regular Trustees; and
(c) a Regular Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purposes of signing any documents which the
Regular Trustees have power and authority to cause the Trust to execute pursuant
to Section 2.6.
Section 3.3 Delaware Trustee
The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
Notwithstanding any other provision of this Declaration, the
Delaware Trustee shall not be entitled to exercise any of the powers, nor shall
the Delaware Trustee have any of the duties and responsibilities of the Regular
Trustees described in this Declaration. The Delaware Trustee shall be a Trustee
for the sole and limited purpose of fulfilling the requirements of Section 3807
of the Business Trust Act. Notwithstanding anything herein to the contrary, the
Delaware Trustee shall not be liable for the acts or omissions to act of the
Trust or of the Regular Trustees except such acts as the Delaware Trustee is
expressly obligated or authorized to undertake under this Declaration or the
Business Trust Act and except for the gross negligence or willful misconduct of
the Delaware Trustee.
Section 3.4 Property Trustee
Prior to the issuance of the Preferred Securities and Common
Securities, the Sponsor shall appoint another trustee (the "Institutional
Trustee") meeting the requirements of an eligible trustee of the Trust Indenture
Act of 1939, as amended, by the execution of an amendment to this Declaration
executed by the Regular Trustees, the Sponsor, the Institutional Trustee and the
Delaware Trustee.
Section 3.5 Not Responsible for Recitals or Sufficiency of
Declaration.
The recitals contained in this Declaration shall be taken as
the statements of the Sponsor, and the Trustees do not assume any responsibility
for their correctness. The Trustees make no representations as to the value or
condition of the property of the Trust or any part thereof The Trustees make no
representations as to the validity or sufficiency of this Declaration.
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<PAGE> 10
ARTICLE IV
LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR
OTHERS
Section 4.1 Exculpation
(d) No Indemnified Person shall be liable, responsible
or accountable in damages or otherwise to the Trust or any Covered Person for
any loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of the Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Declaration or bylaw,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's negligence or willful
misconduct with respect to such acts or omissions; and
(e) an Indemnified Person shall be fully protected in
relying in good faith upon the records of the Trust and upon such information,
opinions, reports or statements presented to the Trust by any Person as to
matters the Indemnified Person reasonably believes are within such other
Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Trust, including information, opinions,
reports or statements as to the value and amount of the assets, liabilities,
profits, losses, or any other facts pertinent to the existence and amount of
assets from which distributions to holders of Securities might properly be paid.
Section 4.2 Fiduciary Duty
(a) To the extent that, at law or in equity, an
Indemnified Person has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to any other Covered Person, an Indemnified
Person acting under this Declaration shall not be liable to the Trust or to any
other Covered Person for its good faith reliance on the provisions of this
Declaration. The provisions of this Declaration, to the extent that they
restrict the duties and liabilities of an Indemnified Person otherwise existing
at law or in equity, are agreed by the parties hereto to replace such other
duties and liabilities of such Indemnified Person;
(b) unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises
between Covered Persons; or
(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an Indemnified
Person shall act in a manner that is, or provides terms that
are, fair and reasonable to the Trust or any holder of
Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to
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<PAGE> 11
such conflict, agreement, transaction or situation and the benefits and burdens
relating to such interests, any customary or accepted industry practices, and
any applicable generally accepted accounting practices or principles. In the
absence of bad faith by the Indemnified Person, the resolution, action or term
so made, taken or provided by the Indemnified Person shall not constitute a
breach of this Declaration or any other agreement contemplated herein or of any
duty or obligation of the Indemnified Person at law or in equity or otherwise;
and
(c) whenever in this Declaration an Indemnified Person
is permitted or required to make a decision:
(i) in its "discretion" or under a grant of similar
authority, the Indemnified Person shall be entitled to
consider such interests and factors as it desires, including
its own interests, and shall have no duty or obligation to
give any consideration to any interest of or factors affecting
the Trust or any other Person; or
(ii) in its "good faith" or under another express
standard, the Indemnified Person shall act under such express
standard and shall not be subject to any other or different
standard imposed by this Declaration or by applicable law.
Section 4.3 Indemnification
(a) (i) The Debenture Issuer shall indemnify, to the
full extent permitted by law, any Company Indemnified 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, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Trust) by reason
of the fact that he is or was a Company Indemnified Person 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 Trust, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself, create a presumption that the Company
Indemnified Person did not act in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the Trust, and, with
respect to any criminal action or proceeding, had reasonable cause to believe
that his conduct was unlawful
(ii) The Debenture Issuer shall indemnify, to the full
extent permitted by law, any Company Indemnified Person who
was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the
right of the Trust to procure a judgment in its favor by
reason of the fact that he is or was a Company Indemnified
Person against expenses (including attorneys' fees) actually
and reasonably incurred by him in connection with the defense
or settlement of such action or suit if he acted in good faith
and in a
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<PAGE> 12
manner he reasonably believed to be in or not opposed to the
best interests of the Trust and except that no such
indemnification shall be made in respect of any claim, issue
or matter as to which such Company Indemnified Person shall
have been adjudged to be liable to the Trust unless and only
to the extent that the Court of Chancery of Delaware or the
court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability
but in view of all the circumstances of the case, such person
is fairly and reasonably entitled to indemnity for such
expenses which such Court of Chancery or such other court
shall deem proper.
(iii) To the extent that a Company Indemnified Person
shall be successful on the merits or otherwise (including
dismissal of an action without prejudice or the settlement of
an action without admission of liability) in defense of any
action, suit or proceeding referred to in paragraphs (i) and
(ii) of this Section 4.3(a), or in defense of any claim, issue
or matter therein, he shall be indemnified, to the full extent
permitted by law, against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection
therewith. (
(iv) Any indemnification under paragraphs (i) and (ii)
of this Section 4.3(a) (unless ordered by a court) shall be
made by the Debenture Issuer only as authorized in the
specific case upon a determination that indemnification of the
Company Indemnified Person is proper in the circumstances
because he has met the applicable standard of conduct set
forth in paragraphs (i) and (ii). Such determination shall be
made (1) by the Regular Trustees by a majority vote of a
quorum consisting of such Regular Trustees who were not
parties to such action, suit or proceeding, (2) if such a
quorum is not obtainable, or, even if obtainable, if a quorum
of disinterested Regular Trustees so directs, by independent
legal counsel in a written opinion, or (3) by the Common
Security Holder of the Trust.
(v) Expenses (including attorneys' fees) incurred by a
Company Indemnified Person in defending a civil, criminal,
administrative or investigative action, suit or proceeding
referred to in paragraphs (i) and (ii) of this Section 4.3(a)
shall be paid by the Debenture Issuer in advance of the final
disposition of such action, suit or proceeding upon receipt of
an undertaking by or on behalf of such Company Indemnified
Person to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the
Debenture Issuer as authorized in this Section 4.3(a).
Notwithstanding the foregoing, no advance shall be made by the
Debenture Issuer if a determination is reasonably and promptly
made (i) by the Regular Trustees by a majority vote of a
quorum of disinterested Regular Trustees, (ii) if such a
quorum is not obtainable, or, even if obtainable, if a quorum
of disinterested Regular Trustees so directs, by independent
legal counsel in a written opinion or (iii) the Common
Security Holder of the Trust, that, based upon the facts known
to the Regular Trustees, counsel or the Common Security Holder
at the time such determination is made, such Company
Indemnified Person acted in bad faith or in a manner that such
person did not believe to be in or not opposed to the best
interests of the Trust, or, with respect to
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<PAGE> 13
any criminal proceeding, that such Company Indemnified Person
believed or had reasonable cause to believe his conduct was
unlawful. In no event shall any advance be made in instances
where the Regular Trustees, independent legal counsel or
Common Security Holder reasonably determine that such person
deliberately breached his duty to the Trust or its Common or
Preferred Security Holders.
(vi) The indemnification and advancement of expenses
provided by, or granted pursuant to, the other paragraphs of
this Section 4.3(a) shall not be deemed exclusive of any other
rights to which those seeking indemnification and advancement
of expenses may be entitled under any agreement, vote of
stockholders or disinterested directors of the Debenture
Issuer or Preferred Security Holders of the Trust or
otherwise, both as to action in his official capacity and as
to action in another capacity while holding such office. All
rights to indemnification under this Section 4.3(a) shall be
deemed to be provided by a contract between the Debenture
Issuer and each Company Indemnified Person who serves in such
capacity at any time while this Section 4.3(a) is in effect.
Any repeal or modification of this Section 4.3(a) shall not
affect any rights or obligations then existing. (vii) The
Debenture Issuer or the Trust may purchase and maintain
insurance on behalf of any person who is or was a Company
Indemnified Person 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 Debenture Issuer would
have the power to indemnify him against such liability under
the provisions of this Section 4.3(a).
(viii) For purposes of this Section 4.3(a), references
to "the Trust" shall include, in addition to the resulting or
surviving entity, any constituent entity (including any
constituent of a constituent) absorbed in a consolidation or
merger, so that any person who is or was a director, trustee,
officer or employee of such constituent entity, or is or was
serving at the request of such constituent entity as a
director, trustee, officer, employee or agent of another
entity, shall stand in the same position under the provisions
of this Section 4.3(a) with respect to the resulting or
surviving entity as he would have with respect to such
constituent entity if its separate existence had continued.
(ix) The indemnification and advancement of expenses
provided by, or granted pursuant to, this Section 4.3(a)
shall, unless otherwise provided when authorized or ratified,
continue as to a person who has ceased to be a Company
Indemnified Person and shall inure to the benefit of the
heirs, executors and administrators of such a person.
(b) The Debenture Issuer agrees to indemnify (i) the
Delaware Trustee, (ii) any Affiliate of the Delaware Trustee, and (iii) any
officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Delaware
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<PAGE> 14
Trustee (each of the Persons in (i) through (iii) being referred to as a
"Fiduciary Indemnified Person") for, and to hold each Fiduciary Indemnified
Person harmless against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder, including the
costs and expenses (including reasonable legal fees and expenses) of defending
itself against, or investigating, any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. The obligation
to indemnify as set forth in this Section 4.3(b) shall survive the termination
of this Declaration.
Section 4.4 Outside Businesses
Any Covered Person, the Sponsor and the Delaware Trustee may
engage in or possess an interest in other business ventures of any nature or
description, independently or with others, similar or dissimilar to the business
of the Trust, and the Trust and the holders of Securities shall have no rights
by virtue of this Declaration in and to such independent ventures or the income
or profits derived therefrom and the pursuit of any such venture, even if
competitive with the business of the Trust, shall not be deemed wrongful or
improper. No Covered Person, the Sponsor or the Delaware Trustee shall be
obligated to present any particular investment or other opportunity to the Trust
even if such opportunity is of a character that, if presented to the Trust,
could be taken by the Trust, and any Covered Person, the Sponsor and the
Delaware Trustee shall have the right to take for its own account (individually
or as a partner or fiduciary) or to recommend to others any such particular
investment or other opportunity. Any Covered Person and the Delaware Trustee may
engage or be interested in any financial or other transaction with the Sponsor
or any Affiliate of the Sponsor, or may act as depositary for, trustee or agent
for or may act on any committee or body of holders of, securities or other
obligations of the Sponsor or its Affiliates.
ARTICLE V
AMENDMENTS, TERMINATION, MISCELLANEOUS
Section 5.1 Amendments
At any time before the issue of any Securities, this
Declaration may be amended by, and only by, a written instrument executed by all
of the Regular Trustees and the Sponsor.
Section 5.2 Termination of Trust
(a) The Trust shall terminate and be of no further force or
effect:
(b) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a certificate of dissolution or its
equivalent with respect to the Sponsor or the revocation of the
Sponsor's charter or of the Trust's certificate of trust;
(iii) upon the entry of a decree of judicial dissolution of
the Sponsor, or the Trust; and
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<PAGE> 15
(iv) before the issue of any Securities, with the consent of
all of the Regular Trustees and the Sponsor; and
(b) as soon as is practicable after the occurrence of an event
referred to in Section 5.2(a), the Trustees shall file a certificate of
cancellation with the Secretary of State of the State of Delaware.
Section 5.3 Governing Law
This Declaration and the rights of the parties hereunder shall
be governed by and interpreted in accordance with the laws of the State of
Delaware and all rights and remedies shall be governed by such laws without
regard to principles of conflict of laws.
Section 5.4 Headings
Headings contained in this Declaration are inserted for
convenience of reference only and do not affect the interpretation of this
Declaration or any provision hereof.
Section 5.5 Successors and Assigns
Whenever in this Declaration any of the parties hereto is
named or referred to, the successors and assigns of such party shall be deemed
to be included, and all covenants and agreements in this Declaration by the
Sponsor and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
Section 5.6 Partial Enforceability
If any provision of this Declaration, or the application of
such provision to any Person or circumstance, shall be held invalid, the
remainder of this Declaration, or the application of such provision to persons
or circumstances other than those to which it is held invalid, shall not be
affected thereby.
Section 5.7 Counterparts
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and they
shall have the same force and effect as though all of the signers had signed a
single signature page.
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<PAGE> 16
IN WITNESS WHEREOF, the undersigned has caused these presents
to be executed as of the day and year first above written.
/s/ T.C. Morris
-----------------------------------------
Name: T.C. Morris
Title: Regular Trustee
/s/ John A Carrig
-----------------------------------------
Name: John A. Carrig
Title: Regular Trustee
/s/ R.B. Gisi
-----------------------------------------
Name: R.B. Gisi
Title: Regular Trustee
THE BANK OF NEW YORK
(DELAWARE), as Delaware Trustee
By: /s/ Mary Jane Morrissey
--------------------------------------
Name: Mary Jane Morrissey
Title: Authorized Signatory
PHILLIPS PETROLEUM COMPANY, as Sponsor
By: /s/ John A Carrig
--------------------------------------
Name: John A Carrig
Title: Vice President and
Treasurer
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<PAGE> 1
EXHIBITS 4-J
================================
DECLARATION OF TRUST
Phillips 66 Capital VI
Dated as of May 22, 1998
================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<S> <C>
ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.1 Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II ORGANIZATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 2.1 Name. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 2.2 Office. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 2.3 Purpose. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 2.4 Authority. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.5 Title to Property of the Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.6 Powers of the Trustees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.7 Filing of Certificate of Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 2.8 Duration of Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 2.9 Responsibilities of the Sponsor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 2.10 Declaration Binding on Securities Holders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
ARTICLE III TRUSTEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 3.1 Trustees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 3.2 Regular Trustees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 3.3 Delaware Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 3.4 Property Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 3.5 Not Responsible for Recitals or Sufficiency of Declaration. . . . . . . . . . . . . . . . . . . . . 7
ARTICLE IV LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR OTHERS . . . . . . . . . . . . . . . . . . . 8
Section 4.1 Exculpation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 4.2 Fiduciary Duty. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 4.3 Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 4.4 Outside Businesses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
ARTICLE V AMENDMENTS, TERMINATION, MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 5.1 Amendments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 5.2 Termination of Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 5.3 Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 5.4 Headings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 5.5 Successors and Assigns. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 5.6 Partial Enforceability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 5.7 Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
</TABLE>
<PAGE> 3
DECLARATION OF TRUST
OF
Phillips 66 Capital V
May 22, 1998
DECLARATION OF TRUST ("Declaration") dated and effective as of
May 22, 1998 by the Trustees (as defined herein), the Sponsor (as defined
herein), and by the holders, from time to time, of undivided beneficial
interests in the Trust to be issued pursuant to this Declaration;
WHEREAS, the Trustees and the Sponsor desire to establish a
trust (the "Trust") pursuant to the Delaware Business Trust Act for the sole
purpose of issuing and selling certain securities representing undivided
beneficial interests in the assets of the Trust and investing the proceeds
thereof in certain Debentures of the Debenture Issuer; and
NOW, THEREFORE, it being the intention of the parties hereto
that the Trust constitute a business trust under the Business Trust Act and
that this Declaration constitute the governing instrument of such business
trust, the Trustees declare that all assets contributed to the Trust will
beheld in trust for the exclusive benefit of the holders, from time to time, of
the securities representing undivided beneficial interests in the assets of the
Trust issued hereunder, subject to the provisions of this Declaration.
ARTICLE I
DEFINITIONS
Section 1.1 Definitions.
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration but not
defined in the preamble above have the
respective meanings assigned to them in this
Section 1.1;
(b) a term defined anywhere in this Declaration has the
same meaning throughout;
(c) all references to "the Declaration" or "this
Declaration" are to this Declaration of
Trust as modified, supplemented or amended
from time to time;
(d) all references in this Declaration to Articles and
Sections are to Articles and Sections of
this Declaration unless otherwise specified;
and
(e) a reference to the singular includes the plural and
vice versa.
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<PAGE> 4
"Affiliate" has the same meaning as given to that term in
Rule 405 of the Securities Act or any successor rule thereunder.
"Business Day" means any day other than a day on which banking
institutions in New York, New York are authorized or required by law to close.
"Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801 et seq., as it may be amended from
time to time, or any successor legislation.
"Commission" means the Securities and Exchange Commission.
"Common Security" means a security representing an undivided
beneficial interest in the assets of the Trust with such terms as may be setout
in any amendment to this Declaration.
"Company Indemnified Person" means (a) any Regular Trustee;(b)
any Affiliate of any Regular Trustee; (c) any officers, directors,
shareholders, members, partners, employees, representatives or agents of any
Regular Trustee; or (d) any employee or agent of the Trust or its Affiliates.
"Covered Person" means (a) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or (ii) the
Trust's Affiliates and (b) any holder of Securities.
"Debenture Issuer" means the Parent in its capacity as the
issuer of the Debentures under the Indenture.
"Debentures" means the series of Debentures to be issued by
the Debenture Issuer and acquired by the Trust.
"Debenture Trustee" means [The Bank of New York, a New York
banking corporation], as trustee under the Indenture until a successor is
appointed thereunder, and thereafter means such successor trustee.
"Delaware Trustee" has the meaning set forth in Section 3.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time or any successor legislation.
"Fiduciary Indemnified Person" has the meaning set forth in
Section 4.3(b).
"Indemnified Person" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the indenture to be entered into between the
Parent and the Debenture Trustee and any indenture supplemental thereto
pursuant to which the Debentures are to be issued.
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<PAGE> 5
"Parent" means Phillips Petroleum Company, a Delaware
corporation or any successor entity in a merger.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Preferred Security" means a security representing an
undivided beneficial interest in the assets of the Trust with such terms as
maybe set out in any amendment to this Declaration.
"Regular Trustee" means any Trustee other than the Delaware
Trustee and the Institutional Trustee (as hereinafter defined).
"Securities" means the Common Securities and the Preferred
Securities.
"Securities Act" means the Securities Act of 1933, as amended
from time to time, or any successor legislation.
"Sponsor" means the Parent in its capacity as sponsor of the
Trust.
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with
the provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
ARTICLE II
ORGANIZATION
Section 2.1 Name.
The Trust created by this Declaration is named "Phillips
66 Capital VI." The Trust's activities may be conducted under the name of the
Trust or any other name deemed advisable by the Regular Trustees.
Section 2.2 Office.
The address of the principal office of the Trust is c/o
Phillips Petroleum Company, Phillips Building, Bartlesville, Oklahoma 74004.
At any time, the Regular Trustees may designate another principal office.
Section 2.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to
issue and sell Securities and use the proceeds from such sale to acquire the
Debentures, and (b) except as
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otherwise limited herein, to engage in only those other activities necessary,
or incidental thereto. The Trust shall not borrow money, issue debt or
reinvest proceeds derived from investments, pledge any of its assets, or
otherwise undertake (or permit to be undertaken) any activity that would cause
the Trust not to be classified for United States federal income tax purposes as
a grantor trust.
Section 2.4 Authority.
Subject to the limitations provided in this Declaration, the
Regular Trustees shall have exclusive and complete authority to carry out the
purposes of the Trust. An action taken by the Regular Trustees in accordance
with their powers shall constitute the act of and serve to bind the Trust. In
dealing with the Regular Trustees acting on behalf of the Trust, no person
shall be required to inquire into the authority of the Regular Trustees to bind
the Trust. Persons dealing with the Trust are entitled to rely conclusively on
the power and authority of the Regular Trustees as set forth in this
Declaration.
Section 2.5 Title to Property of the Trust.
Legal title to all assets of the Trust shall be vested in the
Trust.
Section 2.6 Powers of the Trustees.
The Regular Trustees shall have the exclusive power and
authority to cause the Trust to engage in the following activities:
(a) to issue and sell the Preferred Securities
and the Common Securities in accordance with this Declaration; provided,
however, that the Trust may issue no more than one series of Preferred
Securities and no more than one series of Common Securities, and, provided
further, that there shall be no interests in the Trust other than the
Securities and the issuance of the Securities shall be limited to a one-time,
simultaneous issuance of both Preferred Securities and Common Securities;
(b) in connection with the issue and sale of the
Preferred Securities, at the direction of the Sponsor, to:
(i) execute and file with the Commission
a registration statement on Form S-3 prepared by the
Sponsor, including any amendments thereto in relation
to the Preferred Securities;
(ii) execute and file any documents
prepared by the Sponsor, or take any acts as
determined by the Sponsor to be necessary in order
to qualify or register all or part of the Preferred
Securities in any State in which the Sponsor has
determined to qualify or register such Preferred
Securities for sale;
(iii) execute and file an application,
prepared by the Sponsor, to the New York Stock
Exchange or any other national stock exchange or
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the Nasdaq Stock Market's National Market for
listing upon notice of issuance of any Preferred
Securities;
(iv) execute and file with the Commission
a registration statement on Form 8-A, including any
amendments thereto, prepared by the Sponsor relating
to the registration of the Preferred Securities
under Section 12(b) of the Exchange Act; and
(v) execute and enter into an
underwriting agreement and pricing agreement
providing for the sale of the Preferred Securities;
(c) to employ or otherwise engage employees and
agents (who may be designated as officers with titles) and
managers, contractors, advisors, and consultants and provide
for reasonable compensation for such services;
(d) to incur expenses which are necessary or
incidental to carry out any of the purposes of this
Declaration; and
(e) to execute all documents or instruments,
perform all duties and powers, and do all things for and on
behalf of the Trust in all matters necessary or incidental to
the foregoing.
Section 2.7 Filing of Certificate of Trust.
On or after the date of execution of this Declaration, the
Trustees shall cause the filing of the Certificate of Trust for the Trust in
the form attached hereto as Exhibit A with the Secretary of State of the State
of Delaware.
Section 2.8 Duration of Trust.
The Trust, absent termination pursuant to the provisions of
Section 5.2, shall have existence for fifty-five (55) years from the date
hereof.
Section 2.9 Responsibilities of the Sponsor.
In connection with the issue and sale of the Preferred
Securities, the Sponsor shall have the exclusive right and responsibility to
engage in the following activities:
(a) to prepare for filing by the Trust with the
Commission a registration statement on Form S-3 in relation to the Preferred
Securities, including any amendments thereto;
(b) to determine the States in which to take
appropriate action to qualify or register for sale all or part of the Preferred
Securities and to do any and all such acts, other than actions which must be
taken by the Trust, and advise the Trust of actions it must take, and prepare
for execution and filing any documents to be executed and filed by the Trust,
as the
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Sponsor deems necessary or advisable in order to comply with the applicable
laws of any such States;
(c) to prepare for filing by the Trust an
application to the New York Stock Exchange or any other national stock exchange
or the Nasdaq National Market for listing upon notice of issuance of any
Preferred Securities;
(d) to prepare for filing by the Trust with the
Commission a registration statement on Form 8-A relating to the registration of
the class of Preferred Securities under Section 12(b) of the Exchange Act,
including any amendments thereto; and
(e) to negotiate the terms of an underwriting
agreement and pricing agreement providing for the sale of the Preferred
Securities.
Section 2.10 Declaration Binding on Securities Holders.
Every Person by virtue of having become a holder of a Security
or any interest therein in accordance with the terms of this Declaration, shall
be deemed to have expressly assented and agreed to the terms of, and shall be
bound by, this Declaration.
ARTICLE III
TRUSTEES
Section 3.1 Trustees.
The number of Trustees initially shall be four (4), and
thereafter the number of Trustees shall be such number as shall be fixed from
time to time by a written instrument signed by the Sponsor. The Sponsor is
entitled to appoint or remove without cause any Trustee at any time; provided,
however, that the number of Trustees shall in no event be less than two
(2);provided further that one Trustee, in the case of a natural person, shall
be a person who is a resident of the State of Delaware or that, if not a
natural person, is an entity which has its principal place of business in the
State of Delaware (the "Delaware Trustee"); provided further that there shall
be at least one trustee who is an employee or officer of, or is affiliated with
the Parent (a "Regular Trustee").
Section 3.2 Regular Trustees.
The initial Regular Trustees shall be:
T.C. Morris
John A. Carrig
R.B. Gisi
(a) Except as expressly set forth in this
Declaration, any power of the Regular Trustees may be exercised by, or with the
consent of, anyone such Regular Trustee.
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(b) Unless otherwise determined by the Regular
Trustees, and except as otherwise required by the Business Trust Act, any
Regular Trustee is authorized to execute on behalf of the Trust any documents
which the Regular Trustees have the power and authority to cause the Trust to
execute pursuant to Section 2.6 provided, that, the registration statement
referred to in Section 2.6(b)(i), including any amendments thereto, shall be
signed by a majority ofthe Regular Trustees; and
(c) a Regular Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purposes of signing any documents which the
Regular Trustees have power and authority to cause the Trust to execute
pursuant to Section 2.6.
Section 3.3 Delaware Trustee.
The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
Notwithstanding any other provision of this Declaration, the
Delaware Trustee shall not be entitled to exercise any of the powers, nor shall
the Delaware Trustee have any of the duties and responsibilities of the Regular
Trustees described in this Declaration. The Delaware Trustee shall be a
Trustee for the sole and limited purpose of fulfilling the requirements of
Section 3807 of the Business Trust Act. Notwithstanding anything herein to the
contrary, the Delaware Trustee shall not be liable for the acts or omissions to
act of the Trust or of the Regular Trustees except such acts as the Delaware
Trustee is expressly obligated or authorized to undertake under this
Declaration or the Business Trust Act and except for the gross negligence or
willful misconduct of the Delaware Trustee.
Section 3.4 Property Trustee.
Prior to the issuance of the Preferred Securities and Common
Securities, the Sponsor shall appoint another trustee (the "Institutional
Trustee") meeting the requirements of an eligible trustee of the Trust
Indenture Act of 1939, as amended, by the execution of an amendment to this
Declaration executed by the Regular Trustees, the Sponsor, the Institutional
Trustee and the Delaware Trustee.
Section 3.5 Not Responsible for Recitals or Sufficiency
of Declaration.
The recitals contained in this Declaration shall be taken as
the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as
to the value or condition of the property of the Trust or any part thereof The
Trustees make no representations as to the validity or sufficiency of this
Declaration.
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ARTICLE IV
LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR
OTHERS
Section 4.1 Exculpation.
(d) No Indemnified Person shall be liable,
responsible or accountable in damages or otherwise to the Trust or any Covered
Person for any loss, damage or claim incurred by reason of any act or omission
performed or omitted by such Indemnified Person in good faith on behalf of the
Trust and in a manner such Indemnified Person reasonably believed to be within
the scope of the authority conferred on such Indemnified Person by this
Declaration or bylaw, except that an Indemnified Person shall be liable for any
such loss, damage or claim incurred by reason of such Indemnified Person's
negligence or willful misconduct with respect to such acts or omissions; and
(e) an Indemnified Person shall be fully
protected in relying in good faith upon the records of the Trust and upon such
information, opinions, reports or statements presented to the Trust by any
Person as to matters the Indemnified Person reasonably believes are within such
other Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Trust, including information, opinions,
reports or statements as to the value and amount of the assets, liabilities,
profits, losses, or any other facts pertinent to the existence and amount of
assets from which distributions to holders of Securities might properly be
paid.
Section 4.2 Fiduciary Duty.
(a) To the extent that, at law or in equity, an
Indemnified Person has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to any other Covered Person, an Indemnified
Person acting under this Declaration shall not be liable to the Trust or to any
other Covered Person for its good faith reliance on the provisions of this
Declaration. The provisions of this Declaration, to the extent that they
restrict the duties and liabilities of an Indemnified Person otherwise existing
at law or in equity, are agreed by the parties hereto to replace such other
duties and liabilities of such Indemnified Person;
(b) unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or
arises between Covered Persons; or
(ii) whenever this Declaration or any other
agreement contemplated herein or therein provides that an
Indemnified Person shall act in a manner that is, or provides
terms that are, fair and reasonable to the Trust or any holder
of Securities,
the Indemnified Person shall resolve such conflict of interest, take such
action or provide such terms, considering in each case the relative interest of
each party (including its own interest) to
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such conflict, agreement, transaction or situation and the benefits and burdens
relating to such interests, any customary or accepted industry practices, and
any applicable generally accepted accounting practices or principles. In the
absence of bad faith by the Indemnified Person, the resolution, action or term
so made, taken or provided by the Indemnified Person shall not constitute a
breach of this Declaration or any other agreement contemplated herein or of any
duty or obligation of the Indemnified Person at law or in equity or otherwise;
and
(c) whenever in this Declaration an Indemnified
Person is permitted or required to make a decision:
(i) in its "discretion" or under a grant of
similar authority, the Indemnified Person shall be entitled to
consider such interests and factors as it desires, including
its own interests, and shall have no duty or obligation to
give any consideration to any interest of or factors affecting
the Trust or any other Person; or
(ii) in its "good faith" or under another
express standard, the Indemnified Person shall act under such
express standard and shall not be subject to any other or
different standard imposed by this Declaration or by
applicable law.
Section 4.3 Indemnification.
(a) (i) The Debenture Issuer shall indemnify, to
the full extent permitted by law, any Company Indemnified 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, whether civil, criminal, administrative
or investigative (other than an action by or in the right of the Trust) by
reason of the fact that he is or was a Company Indemnified Person 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 Trust,
and, with respect to any criminal action or proceeding, had no reasonable cause
to believe his conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that
the Company Indemnified Person did not act in good faith and in a manner which
he reasonably believed to be in or not opposed to the best interests of the
Trust, and, with respect to any criminal action or proceeding, had reasonable
cause to believe that his conduct was unlawful
(ii) The Debenture Issuer shall indemnify, to the
full extent permitted by law, any Company Indemnified Person
who was or is a party or is threatened to be made a party to
any threatened, pending or completed action or suit by or in
the right of the Trust to procure a judgment in its favor by
reason of the fact that he is or was a Company Indemnified
Person against expenses (including attorneys' fees) actually
and reasonably incurred by him in connection with the defense
or settlement of such action or suit if he acted in good faith
and in a
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manner he reasonably believed to be in or not opposed to the
best interests of the Trust and except that no such
indemnification shall be made in respect of any claim, issue
or matter as to which such Company Indemnified Person shall
have been adjudged to be liable to the Trust unless and only
to the extent that the Court of Chancery of Delaware or the
court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability
but in view of all the circumstances of the case, such person
is fairly and reasonably entitled to indemnity for such
expenses which such Court of Chancery or such other court
shall deem proper.
(iii) To the extent that a Company Indemnified
Person shall be successful on the merits or otherwise
(including dismissal of an action without prejudice or the
settlement of an action without admission of liability) in
defense of any action, suit or proceeding referred to in
paragraphs (i) and (ii) of this Section 4.3(a), or in defense
of any claim, issue or matter therein, he shall be
indemnified, to the full extent permitted by law, against
expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
(iv) Any indemnification under paragraphs (i)
and (ii) of this Section 4.3(a) (unless ordered by a court)
shall be made by the Debenture Issuer only as authorized in the
specific case upon a determination that indemnification of the
Company Indemnified Person is proper in the circumstances
because he has met the applicable standard of conduct set forth
in paragraphs (i) and (ii). Such determination shall be made
(1) by the Regular Trustees by a majority vote of a quorum
consisting of such Regular Trustees who were not parties to
such action, suit or proceeding, (2) if such a quorum is not
obtainable, or, even if obtainable, if a quorum of
disinterested Regular Trustees so directs, by independent legal
counsel in a written opinion, or (3) by the Common Security
Holder of the Trust.
(v) Expenses (including attorneys' fees)
incurred by a Company Indemnified Person in defending a civil,
criminal, administrative or investigative action, suit or
proceeding referred to in paragraphs (i) and (ii) of this
Section 4.3(a) shall be paid by the Debenture Issuer in advance
of the final disposition of such action, suit or proceeding
upon receipt of an undertaking by or on behalf of such Company
Indemnified Person to repay such amount if it shall ultimately
be determined that he is not entitled to be indemnified by the
Debenture Issuer as authorized in this Section 4.3(a).
Notwithstanding the foregoing, no advance shall be made by the
Debenture Issuer if a determination is reasonably and promptly
made (i) by the Regular Trustees by a majority vote of a quorum
of disinterested Regular Trustees, (ii) if such a quorum is not
obtainable, or, even if obtainable, if a quorum of
disinterested Regular Trustees so directs, by independent legal
counsel in a written opinion or (iii) the Common Security
Holder of the Trust, that, based upon the facts known to the
Regular Trustees, counsel or the Common Security Holder at the
time such determination is made, such Company Indemnified
Person acted in bad faith or in a manner that such person did
not believe to be in or not opposed to the best interests of
the Trust, or, with respect to
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any criminal proceeding, that such Company Indemnified Person
believed or had reasonable cause to believe his conduct was
unlawful. In no event shall any advance be made in instances
where the Regular Trustees, independent legal counsel or
Common Security Holder reasonably determine that such person
deliberately breached his duty to the Trust or its Common or
Preferred Security Holders.
(vi) The indemnification and advancement of
expenses provided by, or granted pursuant to, the other
paragraphs of this Section 4.3(a) shall not be deemed
exclusive of any other rights to which those seeking
indemnification and advancement of expenses may be entitled
under any agreement, vote of stockholders or disinterested
directors of the Debenture Issuer or Preferred Security
Holders of the Trust or otherwise, both as to action in his
official capacity and as to action in another capacity while
holding such office. All rights to indemnification under this
Section 4.3(a) shall be deemed to be provided by a contract
between the Debenture Issuer and each Company Indemnified
Person who serves in such capacity at any time while this
Section 4.3(a) is in effect. Any repeal or modification of
this Section 4.3(a) shall not affect any rights or obligations
then existing.
(vii) The Debenture Issuer or the Trust may
purchase and maintain insurance on behalf of any person who is
or was a Company Indemnified Person 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
Debenture Issuer would have the power to indemnify him against
such liability under the provisions of this Section 4.3(a).
(viii) For purposes of this Section 4.3(a),
references to "the Trust" shall include, in addition to the
resulting or surviving entity, any constituent entity
(including any constituent of a constituent) absorbed in a
consolidation or merger, so that any person who is or was a
director, trustee, officer or employee of such constituent
entity, or is or was serving at the request of such
constituent entity as a director, trustee, officer, employee
or agent of another entity, shall stand in the same position
under the provisions of this Section 4.3(a) with respect to
the resulting or surviving entity as he would have with
respect to such constituent entity if its separate existence
had continued.
(ix) The indemnification and advancement of
expenses provided by, or granted pursuant to, this Section
4.3(a) shall, unless otherwise provided when authorized or
ratified, continue as to a person who has ceased to be a
Company Indemnified Person and shall inure to the benefit of
the heirs, executors and administrators of such a person.
(b) The Debenture Issuer agrees to indemnify (i)
the Delaware Trustee, (ii) any Affiliate of the Delaware Trustee, and (iii) any
officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Delaware
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Trustee (each of the Persons in (i) through (iii) being referred to as a
"Fiduciary Indemnified Person") for, and to hold each Fiduciary Indemnified
Person harmless against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder, including the
costs and expenses (including reasonable legal fees and expenses) of defending
itself against, or investigating, any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. The
obligation to indemnify as set forth in this Section 4.3(b) shall survive the
termination of this Declaration.
Section 4.4 Outside Businesses.
Any Covered Person, the Sponsor and the Delaware Trustee may
engage in or possess an interest in other business ventures of any nature or
description, independently or with others, similar or dissimilar to the
business of the Trust, and the Trust and the holders of Securities shall have
no rights by virtue of this Declaration in and to such independent ventures or
the income or profits derived therefrom and the pursuit of any such venture,
even if competitive with the business of the Trust, shall not be deemed
wrongful or improper. No Covered Person, the Sponsor or the Delaware Trustee
shall be obligated to present any particular investment or other opportunity to
the Trust even if such opportunity is of a character that, if presented to the
Trust, could be taken by the Trust, and any Covered Person, the Sponsor and the
Delaware Trustee shall have the right to take for its own account (individually
or as a partner or fiduciary) or to recommend to others any such particular
investment or other opportunity. Any Covered Person and the Delaware Trustee
may engage or be interested in any financial or other transaction with the
Sponsor or any Affiliate of the Sponsor, or may act as depositary for, trustee
or agent for or may act on any committee or body of holders of, securities or
other obligations of the Sponsor or its Affiliates.
ARTICLE V
AMENDMENTS, TERMINATION, MISCELLANEOUS
Section 5.1 Amendments.
At any time before the issue of any Securities, this
Declaration may be amended by, and only by, a written instrument executed by
all of the Regular Trustees and the Sponsor.
Section 5.2 Termination of Trust.
(a) The Trust shall terminate and be of no
further force or effect:
(i) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a certificate of
dissolution or its equivalent with respect to the Sponsor or
the revocation of the Sponsor's charter or of the Trust's
certificate of trust;
(iii) upon the entry of a decree of judicial
dissolution of the Sponsor, or the Trust; and
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(iv) before the issue of any Securities, with the
consent of all of the Regular Trustees and the Sponsor; and
(b) as soon as is practicable after the
occurrence of an event referred to in Section 5.2(a), the Trustees shall file a
certificate of cancellation with the Secretary of State of the State of
Delaware.
Section 5.3 Governing Law.
This Declaration and the rights of the parties hereunder shall
be governed by and interpreted in accordance with the laws of the State of
Delaware and all rights and remedies shall be governed by such laws without
regard to principles of conflict of laws.
Section 5.4 Headings.
Headings contained in this Declaration are inserted for
convenience of reference only and do not affect the interpretation of this
Declaration or any provision hereof.
Section 5.5 Successors and Assigns.
Whenever in this Declaration any of the parties hereto is
named or referred to, the successors and assigns of such party shall be deemed
to be included, and all covenants and agreements in this Declaration by the
Sponsor and the Trustees shall bind and inure to the benefit of their
respective successors and assigns, whether so expressed.
Section 5.6 Partial Enforceability.
If any provision of this Declaration, or the application of
such provision to any Person or circumstance, shall be held invalid, the
remainder of this Declaration, or the application of such provision to persons
or circumstances other than those to which it is held invalid, shall not be
affected thereby.
Section 5.7 Counterparts.
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and they
shall have the same force and effect as though all of the signers had signed a
single signature page.
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IN WITNESS WHEREOF, the undersigned has caused these presents
to be executed as of the day and year first above written.
/s/ T.C. Morris
--------------------------------------
Name: T.C. Morris
Title: Regular Trustee
/s/ John A. Carrig
--------------------------------------
Name: John A. Carrig
Title Regular Trustee
/s/ R.B. Gisi
--------------------------------------
Name: R.B. Gisi
Title: Regular Trustee
THE BANK OF NEW YORK (DELAWARE), as
Delaware Trustee
By: /s/ Mary Jane Morrissey
----------------------------------
Name: Mary Jane Morrissey
Title: Authorized Signatory
PHILLIPS PETROLEUM COMPANY, as Sponsor
By: /s/ John A. Carrig
-------------------------------------
Name: John A. Carrig
Title: Vice President and
Treasurer
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EXHIBIT 4-M
==================================
AMENDED AND RESTATED DECLARATION
OF TRUST
PHILLIPS 66 CAPITAL V
Dated as of __________ __, 1998
==================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<S> <C>
ARTICLE I INTERPRETATION AND DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.1 Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II TRUST INDENTURE ACT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.1 Trust Indenture Act; Application. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.2 Lists of Holders of Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.3 Reports by the Institutional Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2.4 Periodic Reports to Institutional Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2.5 Evidence of Compliance with Conditions Precedent. . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2.6 Events of Default; Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2.7 Event of Default; Notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE III ORGANIZATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 3.1 Name. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 3.2 Office. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.3 Purpose. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.4 Authority. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.5 Title to Property of the Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.6 Powers and Duties of the Regular Trustees. . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.7 Prohibition of Actions by the Trust and the Trustees. . . . . . . . . . . . . . . . . . . . . . 14
Section 3.8 Powers and Duties of the Institutional Trustee. . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 3.9 Certain Duties and Responsibilities of the Institutional Trustee. . . . . . . . . . . . . . . . 17
Section 3.10 Certain Rights of Institutional Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 3.11 Delaware Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 3.12 Execution of Documents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 3.13 Not Responsible for Recitals or Issuance of Securities. . . . . . . . . . . . . . . . . . . . . 22
Section 3.14 Duration of Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 3.15 Mergers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE IV SPONSOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 4.1 Sponsor's Purchase of Common Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 4.2 Responsibilities of the Sponsor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE V TRUSTEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 5.1 Number of Trustees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 5.2 Delaware Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 5.3 Institutional Trustee; Eligibility. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 5.4 Certain Qualifications of Regular Trustees and Delaware Trustee Generally. . . . . . . . . . . . 27
Section 5.5 Regular Trustees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 5.6 Delaware Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 5.7 Appointment, Removal and Resignation of Trustees. . . . . . . . . . . . . . . . . . . . . . . . 27
Section 5.8 Vacancies among Trustees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 5.9 Effect of Vacancies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 5.10 Meetings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 5.11 Delegation of Power. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 5.12 Merger, Conversion, Consolidation or Succession to Business. . . . . . . . . . . . . . . . . . . 30
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
ARTICLE VI DISTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 6.1 Distributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE VII ISSUANCE OF SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 7.1 General Provisions Regarding Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 7.2 Paying Agent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
ARTICLE VIII TERMINATION OF TRUST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 8.1 Termination of Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
ARTICLE IX TRANSFER OF INTERESTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 9.1 Transfer of Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 9.2 Transfer of Certificates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 9.3 Deemed Security Holders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 9.4 Book Entry Interests. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 9.5 Notices to Clearing Agency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 9.6 Appointment of Successor Clearing Agency. . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 9.7 Definitive Preferred Security Certificates. . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 9.8 Mutilated, Destroyed, Lost or Stolen Certificates. . . . . . . . . . . . . . . . . . . . . . . . 35
ARTICLE X LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR OTHERS . . . . . . . . . . . . . . . . . . . 36
Section 10.1 Liability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 10.2 Exculpation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 10.3 Fiduciary Duty. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 10.4 Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 10.5 Outside Businesses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
ARTICLE XI ACCOUNTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 11.1 Fiscal Year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 11.2 Certain Accounting Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 11.3 Banking. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 11.4 Withholding. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE XII AMENDMENTS AND MEETINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 12.1 Amendments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 12.2 Meetings of the Holders of Securities; Action by Written Consent. . . . . . . . . . . . . . . . 45
ARTICLE XIII REPRESENTATIONS OF INSTITUTIONAL TRUSTEE AND DELAWARE TRUSTEE . . . . . . . . . . . . . . . . . . . . . 47
Section 13.1 Representations and Warranties of Institutional Trustee. . . . . . . . . . . . . . . . . . . . . 47
Section 13.2 Representations and Warranties of Delaware Trustee. . . . . . . . . . . . . . . . . . . . . . . 47
ARTICLE XIV MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 14.1 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 14.2 Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 14.3 Intention of the Parties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 14.4 Headings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 14.5 Successors and Assigns. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 14.6 Partial Enforceability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 14.7 Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
</TABLE>
<PAGE> 4
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
PHILLIPS 66 CAPITAL V
_________ ___, 1998
AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration")
dated and effective as of __________ __, 1998, by the Trustees (as defined
herein), the Sponsor (as defined herein) and by the holders, from time to time,
of undivided beneficial interests in the Trust to be issued pursuant to this
Declaration;
WHEREAS, the Trustees and the Sponsor established Phillips 66
Capital V (the "Trust"), a trust under the Delaware Business Trust Act pursuant
to a Declaration of Trust dated as of February 23, 1998 (the "Original
Declaration"), and a Certificate of Trust filed with the Secretary of State of
the State of Delaware on _________ ____, 1998, for the sole purpose of issuing
and selling certain securities representing undivided beneficial interests in
the assets of the Trust and investing the proceeds thereof in certain
Debentures of the Debenture Issuer;
WHEREAS, as of the date hereof, no interests in the Trust have
been issued;
WHEREAS, all of the Trustees and the Sponsor, by this
Declaration, amend and restate each and every term and provision of the
Original Declaration; and
NOW, THEREFORE, it being the intention of the parties hereto
to continue the Trust as a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust,
the Trustees declare that all assets contributed to the Trust will be held in
trust for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.
ARTICLE I
INTERPRETATION AND DEFINITIONS
Section 1.1 Definitions.
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration
but not defined in the preamble above have the respective meanings assigned to
them in this Section 1.1;
(b) a term defined anywhere in this Declaration
has the same meaning throughout;
(c) all references to "the Declaration" or "this
Declaration" are to this Declaration as modified, supplemented or amended from
time to time;
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<PAGE> 5
(d) all references in this Declaration to
Articles and Sections and Annexes and Exhibits are to Articles and Sections of
and Annexes and Exhibits to this Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has
the same meaning when used in this Declaration unless otherwise defined in this
Declaration or unless the context otherwise requires; and
(f) a reference to the singular includes the
plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act or any successor rule thereunder.
"Agent" means any Paying Agent.
"Authorized Officer" of a Person means any Person that is
authorized to bind such Person.
"Book Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 9.4.
"Business Day" means any day other than a day on which banking
institutions in New York, New York are authorized or required by law to close.
"Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801 et seq., as it may be amended from
time to time, or any successor legislation.
"Certificate" means a Common Security Certificate or a
Preferred Security Certificate.
"Clearing Agency" means an organization registered as a
"Clearing Agency" pursuant to Section 17A of the Exchange Act that is acting as
depositary for the Preferred Securities and in whose name or in the name of a
nominee of that organization shall be registered a Global Certificate and which
shall undertake to effect book entry transfers and pledges of the Preferred
Securities.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time the
Clearing Agency effects book entry transfers and pledges of securities
deposited with the Clearing Agency.
"Closing Date" means the "Closing Time" and each "Date of
Delivery" under the Underwriting Agreement.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, or any successor legislation.
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<PAGE> 6
"Commission" means the Securities and Exchange Commission.
"Common Securities" has the meaning specified in Section
7.1.(a).
"Common Securities Guarantee" means the guarantee agreement to
be dated as of ___________, 1998 of the Sponsor in respect of the Common
Securities.
"Common Security" has the meaning specified in Section 7.1.
"Common Security Certificate" means a definitive certificate
in fully registered form representing a Common Security substantially in the
form of Exhibit A-2.
"Company Indemnified Person" means (a) any Regular Trustee;
(b) any Affiliate of any Regular Trustee; (c) any officers, directors,
shareholders, members, partners, employees, representatives or agents of any
Regular Trustee; or (d) any officer, employee or agent of the Trust or its
Affiliates.
"Corporate Trust Office" means the office of the Institutional
Trustee at which the corporate trust business of the Preferred Guarantee
Trustee shall, at any particular time, be principally administered, which
office at the date of execution of this Agreement is located at White Clay
Center, Route 273, Newark, Delaware 19711.
"Covered Person" means: (a) any officer, director,
shareholder, partner, member, representative, employee or agent of (i) the
Trust or (ii) the Trust's Affiliates; and (b) any Holder of Securities.
"Debenture Issuer" means Phillips Petroleum Company, a
Delaware corporation, in its capacity as issuer of the Debentures under the
Indenture.
"Debenture Trustee" means The Bank of New York, a New York
banking corporation, as trustee under the Indenture until a successor is
appointed thereunder, and thereafter means such successor trustee.
"Debentures" means the series of Debentures to be issued by
the Debenture Issuer under the Indenture to be held by the Institutional
Trustee, a specimen certificate for such series of Debentures being Exhibit B.
"Delaware Trustee" has the meaning set forth in Section 5.2.
"Definitive Preferred Security Certificates" has the meaning
set forth in Section 9.4.
"Distribution" means a distribution payable to Holders of
Securities in accordance with Section 6.1.
"DTC" means The Depository Trust Company, the initial Clearing
Agency.
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<PAGE> 7
"Event of Default" in respect of the Securities means an Event
of Default (as defined in the Indenture) has occurred and is continuing in
respect of the Debentures.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor legislation.
"Fiduciary Indemnified Person" has the meaning set forth in
Section 10.4(b).
"Global Certificate" has the meaning set forth in Section 9.4.
"Holder" means a Person in whose name a Certificate
representing a Security is registered, such Person being a beneficial owner
within the meaning of the Business Trust Act.
"Indemnified Person" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the Indenture dated as of _______, 1998,
among the Debenture Issuer and the Debenture Trustee, and any indenture
supplemental thereto pursuant to which the Debentures are to be issued.
"Institutional Trustee" means the Trustee meeting the
eligibility requirements set forth in Section 5.3.
"Institutional Trustee Account" has the meaning set forth in
Section 3.8(c).
"Investment Company" means an investment company as defined in
the Investment Company Act.
"Investment Company Act" means the Investment Company Act of
1940, as amended from time to time, or any successor legislation.
"Investment Company Event" has the meaning set forth in Annex
I hereto.
"Legal Action" has the meaning set forth in Section 3.6(g).
"Majority in liquidation amount of the Securities" means,
except as provided in the terms of the Preferred Securities or by the Trust
Indenture Act, Holder(s) of outstanding Securities voting together as a single
class or, as the context may require, Holders of outstanding Preferred
Securities or Holders of outstanding Common Securities voting separately as a
class, who are the record owners of more than 50% of the aggregate liquidation
amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accrued and unpaid Distributions to the date
upon which the voting percentages are determined) of all outstanding Securities
of the relevant class.
"Ministerial Action" has the meaning set forth in the terms of
the Securities as set forth in Annex I.
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<PAGE> 8
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Declaration shall include:
(a) a statement that each officer signing the
Certificate has read the covenant or condition and the definitions relating
thereto;
(b) a brief statement of the nature and scope of
the examination or investigation undertaken by each officer in rendering the
Certificate;
(c) a statement that each such officer has made
such examination or investigation as, in such officer's opinion, is necessary
to enable such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of
each such officer, such condition or covenant has been complied with.
"Paying Agent" has the meaning specified in Section 7.2.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Preferred Securities Guarantee" means the guarantee agreement
to be dated as of ______, 1998, of the Sponsor in respect of the Preferred
Securities.
"Preferred Security Beneficial Owner" means, with respect to a
Book Entry Interest, a Person who is the beneficial owner of such Book Entry
Interest, as reflected on the books of the Clearing Agency, or on the books of
a Person maintaining an account with such Clearing Agency (directly as a
Clearing Agency Participant or as an indirect participant, in each case in
accordance with the rules of such Clearing Agency).
"Preferred Security Certificate" means a certificate
representing a Preferred Security substantially in the form of Exhibit A-1.
"Pricing Agreement" means the pricing agreement between the
Trust, the Debenture Issuer, and the underwriters designated by the Regular
Trustees with respect to the offer and sale of the Preferred Securities.
"Quorum" means a majority of the Regular Trustees or, if there
are only two Regular Trustees, both of them.
"Regular Trustee" has the meaning set forth in Section 5.1..
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<PAGE> 9
"Related Party" means, with respect to the Sponsor, any direct
or indirect wholly owned subsidiary of the Sponsor or any other Person that
owns, directly or indirectly, 100% of the outstanding voting securities of the
Sponsor.
"Responsible Officer" means, with respect to the Institutional
Trustee, any officer within the Corporate Trust Office of the Institutional
Trustee, including any vice-president, any assistant vice-president, any
assistant secretary, the treasurer, any assistant treasurer or other officer of
the Corporate Trust Office of the Institutional Trustee customarily performing
functions similar to those performed by any of the above designated officers
and also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of that officer's knowledge of
and familiarity with the particular subject.
"Rule 3a-5" means Rule 3a-5 under the Investment Company Act.
"Securities" means the Common Securities and the Preferred
Securities.
"Securities Act" means the Securities Act of 1933, as amended
from time to time or any successor legislation.
"Special Event" has the meaning set forth in Annex I hereto.
"Securities Guarantees" means the Common Securities Guarantee
and the Preferred Securities Guarantee.
"Sponsor" means Phillips Petroleum Company, a Delaware
corporation, or any successor entity in a merger, consolidation or
amalgamation, in its capacity as sponsor of the Trust.
"Super Majority" has the meaning set forth in Section
2.6(a)(ii).
"Tax Event" has the meaning set forth in Annex I hereto.
"10% in liquidation amount of the Securities" means, except as
provided in the terms of the Preferred Securities or by the Trust Indenture
Act, Holder(s) of outstanding Securities voting together as a single class or,
as the context may require, Holders of outstanding Preferred Securities or
Holders of outstanding Common Securities voting separately as a class, who are
the record owners of 10% or more of the aggregate liquidation amount (including
the stated amount that would be paid on redemption, liquidation or otherwise,
plus accrued and unpaid Distributions to the date upon which the voting
percentages are determined) of all outstanding Securities of the relevant
class.
"Treasury Regulations" means the income tax regulations,
including temporary and proposed regulations, promulgated under the Code by the
United States Treasury, as such regulations may be amended from time to time
(including corresponding provisions of succeeding regulations).
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<PAGE> 10
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with
the provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended from time to time, or any successor legislation.
"Underwriting Agreement" means the Underwriting Agreement for
the offering and sale of Preferred Securities in the form of Exhibit C.
ARTICLE II
TRUST INDENTURE ACT
Section 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions
of the Trust Indenture Act that are required to be part of this Declaration and
shall, to the extent applicable, be governed by such provisions.
(b) The Institutional Trustee shall be the only
Trustee which is a Trustee for the purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of
this Declaration limits, qualifies or conflicts with the duties imposed by
Sections 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties
shall control.
(d) (d) The application of the Trust Indenture
Act to this Declaration shall not affect the nature of the Securities as equity
securities representing undivided beneficial interests in the assets of the
Trust.
Section 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Regular Trustees
on behalf of the Trust shall provide the Institutional Trustee (i) within 14
days after each record date for payment of Distributions, a list, in such form
as the Institutional Trustee may reasonably require, of the names and addresses
of the Holders of the Securities ("List of Holders") as of such record date,
provided that neither the Sponsor nor the Regular Trustees on behalf of the
Trust shall be obligated to provide such List of Holders at any time the List
of Holders does not differ from the most recent List of Holders given to the
Institutional Trustee by the Sponsor and the Regular Trustees on behalf of the
Trust, and (ii) at any other time, within 30 days of receipt by the Trust of a
written request for a List of Holders as of a date no more than 14 days before
such List of Holders is given to the Institutional Trustee. The Institutional
Trustee shall preserve, in as current a form as is reasonably practicable, all
information contained in Lists of Holders given to it or which it receives in
the capacity as Paying Agent (if acting in such capacity) provided that the
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<PAGE> 11
Institutional Trustee may destroy any List of Holders previously given to it on
receipt of a new List of Holders.
(b) The Institutional Trustee shall comply with
its obligations under Sections 311(a), 311(b) and 312(b) of the Trust
Indenture Act.
Section 2.3 Reports by the Institutional Trustee.
Within 60 days after May 1 of each year, the Institutional
Trustee shall provide to the Holders of the Preferred Securities such reports
as are required by Section 313 of the Trust Indenture Act, if any, in the form
and in the manner provided by Section 313 of the Trust Indenture Act. The
Institutional Trustee shall also comply with the requirements of Section
313(d) of the Trust Indenture Act.
Section 2.4 Periodic Reports to Institutional Trustee.
Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide to the Institutional Trustee such documents, reports and
information as required by Section 314 (if any) and the compliance certificate
required by Section 314 of the Trust Indenture Act in the form, in the manner
and at the times required by Section 314 of the Trust Indenture Act.
Section 2.5 Evidence of Compliance with Conditions
Precedent.
Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide to the Institutional Trustee such evidence of compliance
with any conditions precedent, if any, provided for in this Declaration that
relate to any of the matters set forth in Section 314(c) of the Trust
Indenture Act. Any certificate or opinion required to be given by an officer
pursuant to Section 314(c)(1) may be given in the form of an Officers'
Certificate.
Section 2.6 Events of Default; Waiver.
(a) The Holders of a Majority in liquidation
amount of Preferred Securities may, by vote, on behalf of the Holders of all of
the Preferred Securities, waive any past Event of Default in respect of the
Preferred Securities and its consequences, provided that, if the underlying
Event of Default under the Indenture:
(i) is not waivable under the Indenture, the
Event of Default under the Declaration shall also not be
waivable; or
(ii) requires the consent or vote of greater than
a majority in principal amount of the holders of the
Debentures (a "Super Majority") to be waived under the
Indenture, the Event of Default under the Declaration may only
be waived by the vote of the Holders of at least the
proportion in liquidation amount of the Preferred
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<PAGE> 12
Securities that the relevant Super Majority represents of the
aggregate principal amount of the Debentures outstanding.
The foregoing provisions of this Section 2.6(a) shall be in lieu of Section
316(a)(1)(B) of the Trust Indenture Act and such Section 316(a)(1)(B) of the
Trust Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act. Upon such waiver, any such
default shall cease to exist, and any Event of Default with respect to the
Preferred Securities arising therefrom shall be deemed to have been cured, for
every purpose of this Declaration, but no such waiver shall extend to any
subsequent or other default or an Event of Default with respect to the
Preferred Securities or impair any right consequent thereon. Any waiver by the
Holders of the Preferred Securities of an Event of Default with respect to the
Preferred Securities shall also be deemed to constitute a waiver by the Holders
of the Common Securities of any such Event of Default with respect to the
Common Securities for all purposes of this Declaration without any further act,
vote, or consent of the Holders of the Common Securities.
(b) The Holders of a Majority in liquidation
amount of the Common Securities may, by vote, on behalf of the Holders of all
of the Common Securities, waive any past Event of Default with respect to the
Common Securities and its consequences, provided that, if the underlying Event
of Default under the Indenture:
(i) is not waivable under the Indenture, except
where the Holders of the Common Securities are deemed to have
waived such Event of Default under the Declaration as provided
below in this Section 2.6(b), the Event of Default under the
Declaration shall also not be waivable; or
(ii) requires the consent or vote of a Super
Majority to be waived, except where the Holders of the Common
Securities are deemed to have waived such Event of Default
under the Declaration as provided below in this Section
2.6(b), the Event of Default under the Declaration may only be
waived by the vote of the Holders of at least the proportion
in liquidation amount of the Common Securities that the
relevant Super Majority represents of the aggregate principal
amount of the Debentures outstanding;
provided further, each Holder of Common Securities will be deemed to have
waived any such Event of Default and all Events of Default with respect to the
Common Securities and its consequences until all Events of Default with respect
to the Preferred Securities have been cured, waived or otherwise eliminated,
and until such Events of Default have been so cured, waived or otherwise
eliminated, the Institutional Trustee will be deemed to be acting solely on
behalf of the Holders of the Preferred Securities and only the Holders of the
Preferred Securities will have the right to direct the Institutional Trustee in
accordance with the terms of the Securities. The foregoing provisions of this
Section 2.6(b) shall be in lieu of Sections 316(a)(1)(A) and 316(a)(1)(B) of
the Trust Indenture Act and such Sections 316(a)(1)(A) and 316(a)(1)(B) of the
Trust Indenture Act
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are hereby expressly excluded from this Declaration and the Securities, as
permitted by the Trust Indenture Act. Subject to the foregoing provisions of
this Section 2.6(b), upon such waiver, any such default shall cease to exist
and any Event of Default with respect to the Common Securities arising
therefrom shall be deemed to have been cured for every purpose of this
Declaration, but no such waiver shall extend to any subsequent or other default
or Event of Default with respect to the Common Securities or impair any right
consequent thereon.
(c) A waiver of an Event of Default under the
Indenture by the Institutional Trustee at the direction of the Holders of the
Preferred Securities, constitutes a waiver of the corresponding Event of
Default under this Declaration. The foregoing provisions of this Section 2.6(c)
shall be in lieu of Section 316(a)(1)(B) of the Trust Indenture Act and such
Section 316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded
from this Declaration and the Securities, as permitted by the Trust Indenture
Act.
Section 2.7 Event of Default; Notice.
(a) The Institutional Trustee shall, within 90
days after the occurrence of an Event of Default, transmit by mail, first class
postage prepaid, to the Holders of the Securities, notices of all defaults with
respect to the Securities actually known to a Responsible Officer of the
Institutional Trustee, unless such defaults have been cured before the giving
of notice (the term "defaults" for the purposes of this Section 2.7(a) being
hereby defined to be an Event of Default as defined in the Indenture, not
including any periods of grace provided for therein and irrespective of the
giving of any notice provided therein); provided that, except for a default in
the payment of principal of (or premium, if any) or interest on any of the
Debentures or in the payment of any sinking fund installment established for
the Debentures, the Institutional Trustee shall be protected in withholding
such notice if and so long as a Responsible Officer of the Institutional
Trustee in good faith determines that the withholding of such notice is in the
interests of the Holders of the Securities.
(b) The Institutional Trustee shall not be deemed
to have knowledge of any default except:
(i) a default under Sections ____ and ____ of the
Indenture; or
(ii) any default as to which the Institutional
Trustee shall have received written notice or of which a
Responsible Officer of the Institutional Trustee charged with
the administration of the Declaration shall have actual
knowledge.
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ARTICLE III
ORGANIZATION
Section 3.1 Name.
The Trust is named "Phillips 66 Capital V," as such name may
be modified from time to time by the Regular Trustees following written notice
to the Holders of Securities. The Trust's activities may be conducted under the
name of the Trust or any other name deemed advisable by the Regular Trustees.
Section 3.2 Office.
The address of the principal office of the Trust is c/o
Phillips Petroleum Company, Phillips Building, Bartlesville, Oklahoma 74004. On
ten Business Days written notice to the Holders of Securities, the Regular
Trustees may designate another principal office.
Section 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to
issue and sell Securities and use the proceeds from such sale to acquire the
Debentures, and (b) except as otherwise limited herein, to engage in only those
other activities necessary, or incidental thereto. The Trust shall not borrow
money, issue debt or reinvest proceeds derived from investments, pledge any of
its assets, or otherwise undertake (or permit to be undertaken) any activity
that would cause the Trust not to be classified for United States federal
income tax purposes as a grantor trust.
Section 3.4 Authority.
Subject to the limitations provided in this Declaration and to
the specific duties of the Institutional Trustee, the Regular Trustees shall
have exclusive and complete authority to carry out the purposes of the Trust.
An action taken by the Regular Trustees in accordance with their powers shall
constitute the act of and serve to bind the Trust and an action taken by the
Institutional Trustee on behalf of the Trust in accordance with its powers
shall constitute the act of and serve to bind the Trust. In dealing with the
Trustees acting on behalf of the Trust, no person shall be required to inquire
into the authority of the Trustees to bind the Trust. Persons dealing with the
Trust are entitled to rely conclusively on the power and authority of the
Trustees as set forth in this Declaration.
Section 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the
Debentures and the Institutional Trustee Account or as otherwise provided in
this Declaration, legal title to all assets of the Trust shall be vested in the
Trust. The Holders shall not have legal title to any part of the assets of the
Trust, but shall have an undivided beneficial interest in the assets of the
Trust.
Section 3.6 Powers and Duties of the Regular Trustees.
The Regular Trustees shall have the exclusive power, duty and
authority to cause the Trust to engage in the following activities:
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(a) to issue and sell the Preferred Securities
and the Common Securities in accordance with this Declaration; provided,
however, that the Trust may issue no more than one series of Preferred
Securities and no more than one series of Common Securities, and, provided
further, that there shall be no interests in the Trust other than the
Securities, and the issuance of Securities shall be limited to a simultaneous
issuance of both Preferred Securities and Common Securities on [each] Closing
Date;
(b) in connection with the issue and sale of the
Preferred Securities, at the direction of the Sponsor, to:
(i) execute and file with the Commission the
registration statement on Form S-3 prepared by the
Sponsor, including any amendments thereto, pertaining to the
Preferred Securities;
(ii) execute and file any documents prepared by
the Sponsor, or take any acts as determined by the Sponsor to
be necessary in order to qualify or register all or part of
the Preferred Securities in any State in which the Sponsor has
determined to qualify or register such Preferred Securities
for sale;
(iii) execute and file an application, prepared by
the Sponsor, to the New York Stock Exchange, Inc. or any other
national stock exchange or the Nasdaq Stock Market's National
Market for listing upon notice of issuance of any Preferred
Securities;
(iv) execute and file with the Commission a
registration statement on Form 8-A, including any amendments
thereto, prepared by the Sponsor, relating to the registration
of the Preferred Securities under Section 12(b) of the
Exchange Act; and
(v) execute and enter into the Underwriting
Agreement and Pricing Agreement providing for the sale of the
Preferred Securities;
(c) to acquire the Debentures with the proceeds
of the sale of the Preferred Securities and the Common Securities; provided,
however, that the Regular Trustees shall cause legal title to the Debentures to
be held of record in the name of the Institutional Trustee for the benefit of
the Holders of the Preferred Securities and the Holders of Common Securities;
(d) to give the Sponsor and the Institutional
Trustee prompt written notice of the occurrence of a Tax Event; provided that
the Regular Trustees shall consult with the Sponsor and the Institutional
Trustee before taking or refraining from taking any Ministerial Action in
relation to a Tax Event;
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<PAGE> 16
(e) to establish a record date with respect to
all actions to be taken hereunder that require a record date be established,
including and with respect to, for the purposes of Section 316(c) of the Trust
Indenture Act, Distributions, voting rights, redemptions and exchanges, and to
issue relevant notices to the Holders of Preferred Securities and Holders of
Common Securities as to such actions and applicable record dates;
(f) to take all actions and perform such duties
as may be required of the Regular Trustees pursuant to the terms of the
Securities;
(g) to bring or defend, pay, collect, compromise,
arbitrate, resort to legal action, or otherwise adjust claims or demands of or
against the Trust ("Legal Action"), unless pursuant to Section 3.8(e), the
Institutional Trustee has the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and
agents (who may be designated as officers with titles) and managers,
contractors, advisors, and consultants and pay reasonable compensation for such
services;
(i) to cause the Trust to comply with the Trust's
obligations under the Trust Indenture Act;
(j) to give the certificate required by Section
314(a)(4) of the Trust Indenture Act to the Institutional Trustee, which
certificate may be executed by any Regular Trustee;
(k) to incur expenses that are necessary or
inciden- tal to carry out any of the purposes of the Trust;
(l) to act as, or appoint another Person to act
as, registrar and transfer agent for the Securities;
(m) to give prompt written notice to the Holders
of the Securities of any notice received from the Debenture Issuer of its
election to defer payments of interest on the Debentures by extending the
interest payment period under the Indenture;
(n) to execute all documents or instruments,
perform all duties and powers, and do all things for and on behalf of the Trust
in all matters necessary or incidental to the foregoing;
(o) to take all action that may be necessary or
appropriate for the preservation and the continuation of the Trust's valid
existence, rights, franchises and privileges as a statutory business trust
under the laws of the State of Delaware and of each other jurisdiction in which
such existence is necessary to protect the limited liability of the Holders of
the Preferred Securities or to enable the Trust to effect the purposes for
which the Trust was created;
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<PAGE> 17
(p) to take any action, not inconsistent with
this Declaration or with applicable law, that the Regular Trustees determine in
their discretion to be necessary or desirable in carrying out the activities of
the Trust as set out in this Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an
Investment Company required to be registered under the
Investment Company Act;
(ii) causing the Trust to be classified for United
States federal income tax purposes as a grantor trust; and
(iii) cooperating with the Debenture Issuer to
ensure that the Debentures will be treated as indebtedness of
the Debenture Issuer for United States federal income tax
purposes,
provided that such action does not adversely affect the interests of Holders;
and
(q) to take all action necessary to cause all
applicable tax returns and tax information reports that are required to be
filed with respect to the Trust to be duly prepared and filed by the Regular
Trustees, on behalf of the Trust.
The Regular Trustees must exercise the powers set forth in
this Section 3.6 in a manner that is consistent with the purposes and functions
of the Trust set out in Section 3.3, and the Regular Trustees shall not take
any action that is inconsistent with the purposes and functions of the Trust
set forth in Section 3.3.
Subject to this Section 3.6, the Regular Trustees shall have
none of the powers or the authority of the Institutional Trustee set forth in
Section 3.8.
Any expenses incurred by the Regular Trustees pursuant to this
Section 3.6 shall be reimbursed by the Debenture Issuer.
Section 3.7 Prohibition of Actions by the Trust and the
Trustees.
(a) The Trust shall not, and the Trustees
(including the Institutional Trustee) shall not, engage in any activity other
than as required or authorized by this Declaration. In particular, the Trust
shall not and the Trustees (including the Institutional Trustee) shall cause
the Trust not to:
(i) invest any proceeds received by the Trust
from holding the Debentures, but shall distribute all such
proceeds to Holders of Securities pursuant to the terms of
this Declaration and of the Securities;
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<PAGE> 18
(ii) acquire any assets other than as expressly
provided herein;
(iii) possess Trust property for other than a Trust
purpose;
(iv) make any loans or incur any indebtedness
other than loans represented by the Debentures;
(v) possess any power or otherwise act in such a
way as to vary the Trust assets or the terms of the Securities
in any way whatsoever;
(vi) issue any securities or other evidences of
beneficial ownership of, or beneficial interest in, the Trust
other than the Securities; or
(vii) other than as provided in this Amended and
Restated Declaration or Annex I, (A) direct the time, method
and place of exercising any trust or power conferred upon the
Debenture Trustee with respect to the Debentures, (B) waive
any past default that is waivable under the Indenture, (C)
exercise any right to rescind or annul any declaration that
the principal of all the Debentures shall be due and payable,
or (D) consent to any amendment, modification or termination
of the Indenture or the Debentures where such consent shall be
required unless the Trust shall have received an opinion of
counsel to the effect that such modification will not cause
more than an insubstantial risk that for United States federal
income tax purposes the Trust will not be classified as a
grantor trust.
Section 3.8 Powers and Duties of the Institutional
Trustee.
(a) The legal title to the Debentures shall be
owned by and held of record in the name of the Institutional Trustee in trust
for the benefit of the Holders of the Securities. The right, title and interest
of the Institutional Trustee to the Debentures shall vest automatically in each
Person who may hereafter be appointed as Institutional Trustee in accordance
with Section 5.7. Such vesting and cessation of title shall be effective
whether or not conveyancing documents with regard to the Debentures have been
executed and delivered.
(b) The Institutional Trustee shall not transfer
its right, title and interest in the Debentures to the Regular Trustees or to
the Delaware Trustee (if the Institutional Trustee does not also act as
Delaware Trustee).
(c) The Institutional Trustee shall:
(i) establish and maintain a segregated
non-interest bearing trust account (the "Institutional Trustee
Account") in the
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name of and under the exclusive control of the Institutional
Trustee on behalf of the Holders of the Securities and, upon
the receipt of payments of funds made in respect of the
Debentures held by the Institutional Trustee, deposit such
funds into the Institutional Trustee Account and make payments
to the Holders of the Preferred Securities and Holders of the
Common Securities from the Institutional Trustee Account in
accordance with Section 6.1. Funds in the Institutional
Trustee Account shall be held uninvested until disbursed in
accordance with this Declaration. The Institutional Trustee
Account shall be an account that is maintained with a banking
institution the rating on whose long-term unsecured
indebtedness is at least equal to the rating assigned to the
Preferred Securities by a "nationally recognized statistical
rating organization", as that term is defined for purposes of
Rule 436(g)(2) under the Securities Act;
(ii) engage in such ministerial activities as
shall be necessary or appropriate to effect the redemption of
the Preferred Securities and the Common Securities to the
extent the Debentures are redeemed or mature; and
(iii) upon written notice of distribution issued by
the Regular Trustees in accordance with the terms of the
Securities, engage in such ministerial activities as shall be
necessary or appropriate to effect the distribution of the
Debentures to Holders of Securities upon the occurrence of
certain special events (as may be defined in the terms of the
Securities) arising from a change in law or a change in legal
interpretation or other specified circumstances pursuant to
the terms of the Securities.
(d) The Institutional Trustee shall take all
actions and perform such duties as may be specifically required of the
Institutional Trustee pursuant to the terms of the Securities.
(e) The Institutional Trustee shall take any
Legal Action which arises out of or in connection with an Event of Default of
which a Responsible Officer of the Institutional Trustee has actual knowledge
or the Institutional Trustee's duties and obligations under this Declaration or
the Trust Indenture Act; provided however, that if a Declaration Event of
Default has occurred and is continuing and such event is attributable to the
failure of the Debenture Issuer to pay interest or principal on the Debentures
on the date such interest or principal is otherwise payable (or in the case of
redemption, on the redemption date), then a Holder of Preferred Securities may
directly institute a proceeding for enforcement of payment to such Holder of
the principal of or interest on the Debentures having a principal amount equal
to the aggregate liquidation amount of the Preferred Securities of such Holder
(a "Direct Action") on or after the respective due date specified in the
Debentures. In connection with such Direct
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Action, the rights of the Holders of the Common Securities Holder will be
subrogated to the rights of such Holder of Preferred Securities to the extent
of any payment made by the Issuer to such Holder of Preferred Securities in
such Direct Action. Except as provided in the preceding sentences, the Holders
of Preferred Securities will not be able to exercise directly any other remedy
available to the holders of the Debentures.
(f) The Institutional Trustee shall not resign as
a Trustee unless either:
(i) the Trust has been completely liquidated and
the proceeds of the liquidation distributed to the Holders of
Securities pursuant to the terms of the Securities; or
(ii) a Successor Institutional Trustee has been
appointed and has accepted that appointment in accordance with
Section 5.7.
(g) The Institutional Trustee shall have the
legal power to exercise all of the rights, powers and privileges of a holder of
Debentures under the Indenture and, if an Event of Default actually known to a
Responsible Officer of the Institutional Trustee occurs and is continuing, the
Institutional Trustee shall, for the benefit of Holders of the Securities,
enforce its rights as holder of the Debentures subject to the rights of the
Holders pursuant to the terms of such Securities.
(h) The Institutional Trustee may authorize one
or more Persons (each, a "Paying Agent") to pay Distributions, redemption
payments or liquidation payments on behalf of the Trust with respect to all
securities and any such Paying Agent shall comply with Section 317(b) of the
Trust Indenture Act. Any Paying Agent may be removed by the Institutional
Trustee at any time and a successor Paying Agent or additional Paying Agents
may be appointed at any time by the Institutional Trustee.
(i) Subject to this Section 3.8, the
Institutional Trustee shall have none of the duties, liabilities, powers or the
authority of the Regular Trustees set forth in Section 3.6.
The Institutional Trustee must exercise the powers set forth
in this Section 3.8 in a manner that is consistent with the purposes and
functions of the Trust set out in Section 3.3, and the Institutional Trustee
shall not take any action that is inconsistent with the purposes and functions
of the Trust set out in Section 3.3.
Section 3.9 Certain Duties and Responsibilities of the
Institutional Trustee.
(a) The Institutional Trustee, before the
occurrence of any Event of Default and after the curing of all Events of
Default that may have occurred, shall undertake to perform only such duties as
are specifically set forth in this Declaration and no implied covenants shall
be read into this Declaration against the Institutional Trustee. In case an
Event of Default has occurred (that has not been cured or waived pursuant to
Section 2.6) of which a Responsible Officer of the Institutional Trustee has
actual knowledge, the Institutional Trustee
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<PAGE> 21
shall exercise such of the rights and powers vested in it by this Declaration,
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 or
her own affairs.
(b) No provision of this Declaration shall be
construed to relieve the Institutional Trustee from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) prior to the occurrence of an Event of
Default and after the curing or waiving of all such Events of
De- fault that may have occurred:
(A) the duties and obligations of the Institutional
Trustee shall be determined solely by the express provisions of this
Declaration and the Institutional Trustee shall not be liable except for the
performance of such duties and obligations as are specifically set forth in
this Declaration, and no implied covenants or obligations shall be read into
this Declaration against the Institutional Trustee; and
(B) in the absence of bad faith on the part of the
Institutional Trustee, the Institutional Trustee may conclusively rely, as
to the truth of the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the Institutional
Trustee and conforming to the requirements of this Declaration; but in the
case of any such certificates or opinions that by any provision hereof are
specifically required to be furnished to the Institutional Trustee, the
Institutional Trustee shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this Declaration;
(ii) the Institutional Trustee shall not be liable
for any error of judgment made in good faith by a Responsi-
ble Officer of the Institutional Trustee, unless it shall be
proved that the Institutional Trustee was negligent in
ascertaining the pertinent facts;
(iii) the Institutional Trustee shall not be liable
with respect to any action taken or omitted to be taken by it
in good faith in accordance with the direction of the Holders
of not less than a Majority in liquidation amount of the
Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the
Institutional Trustee, or exercising any trust or power
conferred upon the Institutional Trustee under this
Declaration;
(iv) no provision of this Declaration shall
require the Institutional Trustee to expend or risk its own
funds or otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of
its rights or powers, if it shall have reasonable grounds for
believing that the repayment of such funds or
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<PAGE> 22
liability is not reasonably assured to it under the terms of
this Declaration or indemnity reasonably satisfactory to the
Institutional Trustee against such risk or liability is not
reasonably assured to it;
(v) the Institutional Trustee's sole duty with
respect to the custody, safe keeping and physical preservation
of the Debentures and the Institutional Trustee Account shall
be to deal with such property in a similar manner as the
Institutional Trustee deals with similar property for its own
account, subject to the protections and limitations on
liability afforded to the Institutional Trustee under this
Declaration and the Trust Indenture Act;
(vi) the Institutional Trustee shall have no duty
or liability for or with respect to the value, genuineness,
existence or sufficiency of the Debentures or the payment of
any taxes or assessments levied thereon or in connection
therewith;
(vii) the Institutional Trustee shall not be liable
for any interest on any money received by it except as it may
otherwise agree with the Sponsor. Money held by the
Institutional Trustee need not be segregated from other funds
held by it except in relation to the Institutional Trustee
Account maintained by the Institutional Trustee pursuant to
Section 3.8(c)(i) and except to the extent otherwise required
by law; and
(viii) the Institutional Trustee shall not be
responsible for monitoring the compliance by the Regular
Trustees or the Sponsor with their respective duties under
this Declaration, nor shall the Institutional Trustee be
liable for default or misconduct of the Regular Trustees or
the Sponsor.
Section 3.10 Certain Rights of Institutional Trustee.
(a) Subject to the provisions of Section 3.9:
(i) the Institutional Trustee may conclusively
rely and shall be fully protected in acting or refraining from
acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be
genuine and to have been signed, sent or presented by the
proper party or parties;
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<PAGE> 23
(ii) any direction or act of the Sponsor or the
Regular Trustees contemplated by this Declaration shall be
sufficiently evidenced by a Direction or an Officers'
Certificate;
(iii) whenever in the administration of this
Declaration, the Institutional Trustee shall deem it
desirable that a matter be proved or established before
taking, suffering or omitting any action hereunder, the
Institutional Trustee (unless other evidence is herein
specifically prescribed) may, in the absence of bad faith on
its part, request and conclusively rely upon an Officers'
Certificate which, upon receipt of such request, shall be
promptly delivered by the Sponsor or the Regular Trustees;
(iv) the Institutional Trustee shall have no duty
to see to any recording, filing or registration of any
instrument (including any financing or continuation statement
or any filing under tax or securities laws) or any
rerecording, refiling or registration thereof;
(v) the Institutional Trustee may consult with
counsel or other experts and the advice or opinion of such
counsel and experts with respect to legal matters or advice
within the scope of such experts' area of expertise shall be
full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder in good
faith and in accordance with such advice or opinion, such
counsel may be counsel to the Sponsor or any of its
Affiliates, and may include any of its employees. The
Institutional Trustee shall have the right at any time to seek
instructions concerning the administration of this Declaration
from any court of competent jurisdiction;
(vi) the Institutional Trustee shall be under no
obligation to exercise any of the rights or powers vested init
by this Declaration at the request or direction of any Holder,
unless such Holder shall have provided to the Institutional
Trustee security and indemnity, reasonably satisfactory to the
Institutional Trustee, against the costs, expenses (including
attorneys' fees and expenses and the expenses of the
Institutional Trustee's agents, nominees or custodians) and
liabilities that might be incurred by it in complying with
such request or direction, including such reasonable advances
as may be requested by the Institutional Trustee provided,
that, nothing contained in this Section 3.10(a)(vi) shall be
taken to relieve the Institutional Trustee, upon the
occurrence of an Event of Default, of its obligation to
exercise the rights and powers vested in it by this
Declaration;
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<PAGE> 24
(vii) the Institutional Trustee shall not be bound
to make any investigation into the facts or matters stated in
any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper
or document, but the Institutional Trustee, in its discretion,
may make such further inquiry or investigation into such facts
or matters as it may see fit;
(viii) the Institutional Trustee may execute any of
the trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents, custodians, nominees
or attorneys and the Institutional Trustee shall not be
responsible for any misconduct or negligence on the part of
any agent or attorney appointed with due care by it hereunder;
(ix) any action taken by the Institutional Trustee
or its agents hereunder shall bind the Trust and the Holders
of the Securities, and the signature of the Institutional
Trustee or its agents alone shall be sufficient and effective
to perform any such action and no third party shall be
required to inquire as to the authority of the Institutional
Trustee to so act or as to its compliance with any of the
terms and provisions of this Declaration, both of which shall
be conclusively evidenced by the Institutional Trustee's or
its agent's taking such action;
(x) whenever in the administration of this
Declaration the Institutional Trustee shall deem it desirable
to receive instructions with respect to enforcing any remedy
or right or taking any other action hereunder, the
Institutional Trustee (i) may request instructions from the
Holders of the Securities which instructions may only be given
by the Holders of the same proportion in liquidation amount of
the Securities as would be entitled to direct the
Institutional Trustee under the terms of the Securities in
respect of such remedy, right or action, (ii) may refrain from
enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be
protected in conclusively relying on or acting in or
accordance with such instructions; and
(xi) except as otherwise expressly provided by
this Declaration, the Institutional Trustee shall not be under
any obligation to take any action that is discretionary under
the provisions of this Declaration.
(b) No provision of this Declaration shall be
deemed to impose any duty or obligation on the Institutional Trustee to perform
any act or acts or exercise any right,
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<PAGE> 25
power, duty or obligation conferred or imposed on it, in any jurisdiction in
which it shall be illegal, or in which the Institutional Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Institutional Trustee shall be
construed to be a duty.
Section 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration other
than Section 5.2, the Delaware Trustee shall not be entitled to exercise any
powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of the Regular Trustees or the Institutional Trustee described
in this Declaration. Except as set forth in Section 5.2, the Delaware Trustee
shall be a Trustee for the sole and limited purpose of fulfilling the
requirements of Section 3807 of the Business Trust Act.
Section 3.12 Execution of Documents.
Unless otherwise determined by the Regular Trustees, and
except as otherwise required by the Business Trust Act, a majority of or, if
there are only two, any Regular Trustee or, if there is only one, such Regular
Trustee is authorized to execute on behalf of the Trust any documents that the
Regular Trustees have the power and authority to execute pursuant to Section
3.6; provided that, the registration statement referred to in Section
3.6(b)(i), including any amendments thereto, shall be signed by all of the
Regular Trustees.
Section 3.13 Not Responsible for Recitals or Issuance of
Securities.
The recitals contained in this Declaration and the Securities
shall be taken as the statements of the Sponsor, and the Trustees do not assume
any responsibility for their correctness. The Trustees make no representations
as to the value or condition of the property of the Trust or any part thereof.
The Trustees make no representations as to the validity or sufficiency of this
Declaration or the Securities.
Section 3.14 Duration of Trust.
The Trust, unless terminated pursuant to the provisions of
Article VIII hereof, shall have existence for fifty-five (55) years from the
Closing Date.
Section 3.15 Mergers.
(a) The Trust may not consolidate, amalgamate,
merge with or into, or be replaced by, or convey, transfer or lease its
properties and assets substantially as an entirety to any corporation or other
body, except as described in Section 3.15(b) and (c).
(b) The Trust may, with the consent of the
Regular Trustees or, if there are more than two, a majority of the Regular
Trustees and without the consent of the Holders of
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the Securities, the Delaware Trustee or the Institutional Trustee, consolidate,
amalgamate, merge with or into, or be replaced by a trust organized as such
under the laws of any State; provided that:
(i) such successor entity (the "Successor
Entity") either:
(A) expressly assumes all of the obligations of the Trust
under the Securities; or
(B) substitutes for the Securities other securities
having substantially the same terms as the Preferred Securities (the
"Successor Securities") so long as the Successor Securities rank the same as
the Preferred Securities rank with respect to Distributions and payments
upon liquidation, redemption and otherwise;
(ii) the Debenture Issuer expressly acknowledges a
trustee of the Successor Entity that possesses the same powers
and duties as the Institutional Trustee as the Holder of the
Debentures;
(iii) the Preferred Securities or any Successor
Securities are listed, or any Successor Securities will be
listed upon notification of issuance, on any national
securities exchange or with another organization on which the
Preferred Securities are then listed or quoted;
(iv) such merger, consolidation, amalgamation or
replacement does not cause the Preferred Securities (including
any Successor Securities) to be downgraded by any nationally
recognized statistical rating organization;
(v) such merger, consolidation, amalgamation or
replacement does not adversely affect the rights, preferences
and privileges of the Holders of the Securities (including any
Successor Securities) in any material respect (other than with
respect to any dilution of such Holders' interests in the
Preferred Securities as a result of such merger,
consolidation, amalgamation or replacement);
(vi) such Successor Entity has a purpose identical
to that of the Trust;
(vii) prior to such merger, consolidation,
amalgamation or replacement, the Sponsor has received an
opinion of a nationally recognized independent counsel to the
Trust experienced in such matters to the effect that:
(A) such merger, consolidation, amalgamation or
replacement does not adversely affect the rights, preferences and privileges
of the Holders of the Securities
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(including any Successor Securities) in any material respect (other than
with respect to any dilution of the Holders' interest in the new entity);
and
(B) following such merger, consolidation, amalgamation or
replacement, neither the Trust nor the Successor Entity will be required to
register as an Investment Company;
(C) following such merger, consolidation, amalgamation or
replacement, the Trust (or the Successor Entity) will continue to be
classified as a grantor trust for United States federal income tax purposes;
and
(viii) the Sponsor guarantees the obligations of
such Successor Entity under the Successor Securities at least
to the extent provided by the Preferred Securities Guarantees.
(c) Notwithstanding Section 3.15(b), the Trust
shall not, except with the consent of Holders of 100% in liquidation amount of
the Securities, consolidate, amalgamate, merge with or into, or be replaced by
any other entity or permit any other entity to consolidate, amalgamate, merge
with or into, or replace it if such consolidation, amalgamation, merger or
replacement would cause the Trust or Successor Entity to be classified as other
than a grantor trust for United States federal income tax purposes.
ARTICLE IV
SPONSOR
Section 4.1 Sponsor's Purchase of Common Securities.
On the Closing Date the Sponsor will purchase all of the
Common Securities issued by the Trust, in an amount at least equal to 3% of the
capital of the Trust, at the same time as the Preferred Securities are sold.
Section 4.2 Responsibilities of the Sponsor.
In connection with the issue and sale of the Preferred
Securities, the Sponsor shall have the exclusive right and responsibility to
engage in the following activities:
(a) to prepare for filing by the Trust with the
Commission a registration statement on Form S-3 in relation to the Preferred
Securities, including any amendments thereto;
(b) to determine the States in which to take
appropriate action to qualify or register for sale all or part of the Preferred
Securities and to do any and all such acts, other than actions which must be
taken by the Trust, and advise the Trust of actions it must take, and prepare
for execution and filing any documents to be executed and filed by the Trust,
as the
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Sponsor deems necessary or advisable in order to comply with the applicable
laws of any such States;
(c) to prepare for filing by the Trust an
application to the New York Stock Exchange or any other national stock exchange
or the Nasdaq National Market for listing upon notice of issuance of any
Preferred Securities;
(d) to prepare for filing by the Trust with the
Commission a registration statement on Form 8-A relating to the registration of
the Preferred Securities under Section 12(b) of the Exchange Act, including any
amendments thereto; and
(e) to negotiate the terms of the Underwriting
Agreement and Pricing Agreement providing for the sale of the Preferred
Securities.
ARTICLE V
TRUSTEES
Section 5.1 Number of Trustees.
The number of Trustees initially shall be [four (4)], and:
(a) at any time before the issuance of any
Securities, the Sponsor may, by written instrument, increase or decrease the
number of Trustees; and
(b) after the issuance of any Securities, the
number of Trustees may be increased or decreased by vote of the Holders of a
majority in liquidation amount of the Common Securities voting as a class at a
meeting of the Holders of the Common Securities; provided, however, that, the
number of Trustees shall in no event be less than two (2); provided further
that (1) one Trustee, in the case of a natural person, shall be a person who is
a resident of the State of Delaware or that, if not a natural person, is an
entity which has its principal place of business in the State of Delaware (the
"Delaware Trustee"); (2) there shall be at least one Trustee who is an employee
or officer of, or is affiliated with the Parent (a "Regular Trustee"); and (3)
one Trustee shall be the Institutional Trustee for so long as this Declaration
is required to qualify as an indenture under the Trust Indenture Act, and such
Trustee may also serve as Delaware Trustee if it meets the applicable
requirements.
Section 5.2 Delaware Trustee.
If required by the Business Trust Act, one Trustee (the
"Delaware Trustee") shall be:
(a) a natural person who is a resident of the
State of Delaware; or
(b) if not a natural person, an entity which has
its principal place of business in the State of Delaware, and otherwise meets
the requirements of applicable law,
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provided that, if the Institutional Trustee has its principal place of business
in the State of Delaware and otherwise meets the requirements of applicable
law, then the Institutional Trustee shall also be the Delaware Trustee and
Section 3.11 shall have no application.
Section 5.3 Institutional Trustee; Eligibility.
(a) There shall at all times be one Trustee which
shall act as Institutional Trustee which shall:
(i) not be an Affiliate of the Sponsor; and
(ii) be a corporation organized and doing business
under the laws of the United States of America or any State or
Territory thereof or of the District of Columbia, or a
corporation or Person permitted by the Commission to act as an
institutional trustee under the Trust Indenture Act,
authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least 50 million
U.S. dollars ($50,000,000), and subject to supervision or
examination by Federal, State, Territorial or District of
Columbia authority. If such corporation publishes reports of
condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority
referred to above, then for the purposes of this Section
5.3(a)(ii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so
published.
(b) If at any time the Institutional Trustee
shall cease to be eligible to so act under Section 5.3(a), the Institutional
Trustee shall immediately resign in the manner and with the effect set forth in
Section 5.7(c).
(c) If the Institutional Trustee has or shall
acquire any "conflicting interest" within the meaning of Section 310(b) of the
Trust Indenture Act, the Institutional Trustee and the Holder of the Common
Securities (as if it were the obligor referred to in Section 310(b) of the
Trust Indenture Act) shall in all respects comply with the provisions of
Section 310(b) of the Trust Indenture Act.
(d) The Preferred Securities Guarantee shall be
deemed to be specifically described in this Declaration for purposes of clause
(i) of the first provision contained in Section 310(b) of the Trust Indenture
Act.
(e) The initial Institutional Trustee shall be:
The Bank of New York
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Section 5.4 Certain Qualifications of Regular Trustees
and Delaware Trustee Generally.
Each Regular Trustee and the Delaware Trustee (unless the
Institutional Trustee also acts as Delaware Trustee) shall be either a natural
person who is at least 21 years of age or a legal entity that shall act through
one or more Authorized Officers.
Section 5.5 Regular Trustees.
The initial Regular Trustees shall be:
T.C. Morris
J.A. Carrig
R.B. Gisi
(a) Except as expressly set forth in this
Declaration and except if a meeting of the Regular Trustees is called with
respect to any matter over which the Regular Trustees have power to act, any
power of the Regular Trustees may be exercised by, or with the consent of, any
one such Regular Trustee.
(b) Unless otherwise determined by the Regular
Trustees, and except as otherwise required by the Business Trust Act or
applicable law, any Regular Trustee is authorized to execute on behalf of the
Trust any documents which the Regular Trustees have the power and authority to
cause the Trust to execute pursuant to Section 3.6, provided, that, the
registration statement referred to in Section 3.6, including any amendments
thereto, shall be signed by all of the Regular Trustees; and
(c) a Regular Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purposes of signing any documents which the
Regular Trustees have power and authority to cause the Trust to execute
pursuant to Section 3.6.
Section 5.6 Delaware Trustee.
The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
Section 5.7 Appointment, Removal and Resignation of
Trustees.
(a) Subject to Section 5.7(b), Trustees may be
appointed or removed without cause at any time:
(i) until the issuance of any Securities, by
written instrument executed by the Sponsor; and
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(ii) after the issuance of any Securities, by vote
of the Holders of a Majority in liquidation amount of the
Common Securities voting as a class at a meeting of the
Holders of the Common Securities.
(b)
(i) The Trustee that acts as Institutional
Trustee shall not be removed in accordance with Section 5.7(a)
until a Successor Institutional Trustee has been appointed and
has accepted such appointment by written instrument executed
by such Successor Institutional Trustee and delivered to the
Regular Trustees and the Sponsor; and
(ii) the Trustee that acts as Delaware Trustee
shall not be removed in accordance with this Section 5.7(a)
until a successor Trustee possessing the qualifications to act
as Delaware Trustee under Sections 5.2 and 5.4 (a "Successor
Delaware Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor
Delaware Trustee and delivered to the Regular Trustees and the
Sponsor.
(c) A Trustee appointed to office shall hold
office until his successor shall have been appointed or until his death,
removal or resignation. Any Trustee may resign from office (without need for
prior or subsequent accounting) by an instrument in writing signed by the
Trustee and delivered to the Sponsor and the Trust, which resignation shall
take effect upon such delivery or upon such later date as is specified therein;
provided, however, that:
(i) No such resignation of the Trustee that acts
as the Institutional Trustee shall be effective:
(A) until a Successor Institutional Trustee has been
appointed and has accepted such appointment by instrument executed by such
Successor Institutional Trustee and delivered to the Trust, the Sponsor and
the resigning Institutional Trustee; or
(B) until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the holders of the
Securities; and
(ii) no such resignation of the Trustee that acts
as the Delaware Trustee shall be effective until a Successor
Delaware Trustee has been appointed and has accepted such
appointment by instrument executed by such Successor Delaware
Trustee and delivered to the Trust, the Sponsor and the
resigning Delaware Trustee.
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(d) The Holders of the Common Securities shall
use their best efforts to promptly appoint a Successor Delaware Trustee or
Successor Institutional Trustee as the case may be if the Institutional Trustee
or the Delaware Trustee delivers an instrument of resignation in accordance
with this Section 5.7.
(e) If no Successor Institutional Trustee or
Successor Delaware Trustee shall have been appointed and accepted appointment
as provided in this Section 5.7 within 60 days after delivery to the Sponsor
and the Trust of an instrument of resignation, the resigning Institutional
Trustee or Delaware Trustee, as applicable, may petition any court of competent
jurisdiction for appointment of a Successor Institutional Trustee or Successor
Delaware Trustee. Such court may thereupon, after prescribing such notice, if
any, as it may deem proper and prescribe, appoint a Successor Institutional
Trustee or Successor Delaware Trustee, as the case may be.
(f) No Institutional Trustee or Delaware Trustee
shall be liable for the acts or omissions to act of any Successor Institutional
Trustee or successor Delaware Trustee, as the case may be.
Section 5.8 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the
number of Trustees is not reduced pursuant to Section 5.1, or if the number of
Trustees is increased pursuant to Section 5.1, a vacancy shall occur. A
resolution certifying the existence of such vacancy by the Regular Trustees or,
if there are more than two, a majority of the Regular Trustees shall be
conclusive evidence of the existence of such vacancy. The vacancy shall be
filled with a Trustee appointed in accordance with Section 5.7.
Section 5.9 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of a
Trustee shall not operate to annul the Trust. Whenever a vacancy in the number
of Regular Trustees shall occur, until such vacancy is filled by the
appointment of a Regular Trustee in accordance with Section 5.7, the Regular
Trustees in office, regardless of their number, shall have all the powers
granted to the Regular Trustees and shall discharge all the duties imposed upon
the Regular Trustees by this Declaration.
Section 5.10 Meetings.
If there is more than one Regular Trustee, meetings of the
Regular Trustees shall be held from time to time upon the call of any Regular
Trustee. Regular meetings of the Regular Trustees may be held at a time and
place fixed by resolution of the Regular Trustees. Notice of any in-person
meetings of the Regular Trustees shall be hand delivered or otherwise delivered
in writing (including by facsimile, with a hard copy by overnight courier) not
less than 48 hours before such meeting. Notice of any telephonic meetings of
the Regular Trustees or any
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committee thereof shall be hand delivered or otherwise delivered in writing
(including by facsimile, with a hard copy by overnight courier) not less than
24 hours before a meeting. Notices shall contain a brief statement of the time,
place and anticipated purposes of the meeting. The presence (whether in person
or by telephone) of a Regular Trustee at a meeting shall constitute a waiver of
notice of such meeting except where a Regular Trustee attends a meeting for the
express purpose of objecting to the transaction of any activity on the ground
that the meeting has not been lawfully called or convened. Unless provided
otherwise in this Declaration, any action of the Regular Trustees may be taken
at a meeting by vote of a majority of the Regular Trustees present (whether in
person or by telephone) and eligible to vote with respect to such matter,
provided that a Quorum is present, or without a meeting by the unanimous
written consent of the Regular Trustees. In the event there is only one Regular
Trustee, any and all action of such Regular Trustee shall be evidenced by a
written consent of such Regular Trustee.
Section 5.11 Delegation of Power.
(a) Any Regular Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purpose of executing any documents
contemplated in Section 3.6, including any registration statement or amendment
thereto filed with the Commission, or making any other governmental filing; and
(b) the Regular Trustees shall have power to
delegate from time to time to such of their number or to officers of the Trust
the doing of such things and the execution of such instruments either in the
name of the Trust or the names of the Regular Trustees or otherwise as the
Regular Trustees may deem expedient, to the extent such delegation is not
prohibited by applicable law or contrary to the provisions of the Trust, as set
forth herein.
Section 5.12 Merger, Conversion, Consolidation or
Succession to Business.
Any corporation into which the Institutional Trustee or the
Delaware Trustee, as the case may be, may be merged or converted or with which
either may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Institutional Trustee or the Delaware
Trustee, as the case may be, shall be a party, or any corporation succeeding to
all or substantially all the corporate trust business of the Institutional
Trustee or the Delaware Trustee, as the case may be, shall be the successor of
the Institutional Trustee or the Delaware Trustee, as the case may be,
hereunder, provided such corporation shall be otherwise qualified and eligible
under this Article, without the execution or filing of any paper or any further
act on the part of any of the parties hereto.
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ARTICLE VI
DISTRIBUTIONS
Section 6.1 Distributions.
Holders shall receive Distributions (as defined herein) in
accordance with the applicable terms of the relevant Holder's Securities.
Distributions shall be made on the Preferred Securities and the Common
Securities in accordance with the preferences set forth in their respective
terms. If and to the extent that the Debenture Issuer makes a payment of
interest (including Compounded Interest (as defined in the Indenture) and
Additional Interest (as defined in the Indenture)), premium and/or principal on
the Debentures held by the Institutional Trustee (the amount of any such
payment being a "Payment Amount"), the Institutional Trustee shall and is
directed, to the extent funds are available for that purpose, to make a
distribution (a "Distribution") of the Payment Amount to Holders.
ARTICLE VII
ISSUANCE OF SECURITIES
Section 7.1 General Provisions Regarding Securities.
(a) The Regular Trustees shall on behalf of the
Trust issue one class of preferred securities representing undivided beneficial
interests in the assets of the Trust having such terms as are set forth in
Annex I (the "Preferred Securities") and one class of common securities
representing undivided beneficial interests in the assets of the Trust having
such terms as are set forth in Annex I (the "Common Securities.") The Trust
shall issue no securities or other interests in the assets of the Trust other
than the Preferred Securities and the Common Securities.
(b) The Certificates shall be signed on behalf of
the Trust by a Regular Trustee. Such signature shall be the manual signature of
any present or any future Regular Trustee. In case any Regular Trustee of the
Trust who shall have signed any of the Securities shall cease to be such
Regular Trustee before the Certificates so signed shall be delivered by the
Trust, such Certificates nevertheless may be delivered as though the person who
signed such Certificates had not ceased to be such Regular Trustee; and any
Certificate may be signed on behalf of the Trust by such persons who, at the
actual date of execution of such Security, shall be the Regular Trustees of the
Trust, although at the date of the execution and delivery of the Declaration
any such person was not such a Regular Trustee. Certificates shall be printed,
lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Regular Trustees, as evidenced by their execution
thereof, and may have such letters, numbers or other marks of identification or
designation and such legends or endorsements as the Regular Trustees may deem
appropriate, or as may be required to comply with any law or with any rule or
regulation of any stock exchange on which Securities may be listed, or to
conform to usage.
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(c) The consideration received by the Trust for
the issuance of the Securities shall constitute a contribution to the capital
of the Trust and shall not constitute a loan to the Trust.
(d) Upon issuance of the Securities as provided
in this Declaration, the Securities so issued shall be deemed to be validly
issued, fully paid and non-assessable.
(e) Every Person, by virtue of having become a
Holder or a Preferred Security Beneficial Owner in accordance with the terms of
this Declaration, shall be deemed to have expressly assented and agreed to the
terms of, and shall be bound by, this Declaration.
Section 7.2 Paying Agent.
In the event that the Preferred Securities are not in
book-entry only form, the Trust shall maintain in the Borough of Manhattan,
City of New York, State of New York, an office or agency where the Preferred
Securities may be presented for payment ("Paying Agent). The Trust may appoint
the Paying Agent and may appoint one or more additional paying agents in such
other locations as it shall determine. The term "Paying Agent" includes any
additional paying agent. The Trust may change any Paying Agent without prior
notice to any Holder. The Trust shall notify the Institutional Trustee of the
name and address of any Agent not a party to this Declaration. If the Trust
fails to appoint or maintain another entity as Paying Agent, the Institutional
Trustee shall act as such. The Trust or any of its Affiliates may act as Paying
Agent. The Trust shall initially act as Paying Agent for the Preferred
Securities and the Common Securities.
ARTICLE VIII
TERMINATION OF TRUST
Section 8.1 Termination of Trust.
(a) The Trust shall terminate:
(i) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a certificate of
dissolution or its equivalent with respect to the Sponsor; the
filing of a certificate of cancellation with respect to the
Trust after having obtained the consent of a majority in
liquidation amount of the Securities voting together as a
single class to file such certificate of cancellation or the
revocation of the Sponsor's charter and the expiration of 90
days after the date of revocation without a reinstatement
thereof;
(iii) upon the entry of a decree of judicial
dissolution of the Holder of the Common Securities, the
Sponsor or the Trust;
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(iv) when all of the Securities shall have been
called for redemption and the amounts necessary for redemption
thereof shall have been paid to the Holders in accordance with
the terms of the Securities;
(v) upon the occurrence and continuation of a
Special Event pursuant to which the Trust shall have been
dissolved in accordance with the terms of the Securities and
all of the Debentures endorsed thereon shall have been
distributed to the Holders of Securities in exchange for all
of the Securities; or
(vi) before the issuance of any Securities, with
the consent of all of the Regular Trustees and the Sponsor.
(b) As soon as is practicable after the
occurrence of an event referred to in Section 8.1(a), the Trustees shall file a
certificate of cancellation with the Secretary of State of the State of
Delaware.
(c) The provisions of Section 3.9 and Article X
shall survive the termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
Section 9.1 Transfer of Securities.
(a) Securities may only be transferred, in whole
or in part, in accordance with the terms and conditions set forth in this
Declaration and in the terms of the Securities. Any transfer or purported
transfer of any Security not made in accordance with this Declaration shall be
null and void.
(b) Subject to this Article IX, Preferred
Securities shall be freely transferable.
(c) The Sponsor may not transfer the Common
Securities.
Section 9.2 Transfer of Certificates.
The Regular Trustees shall provide for the registration of
Certificates and of transfers of Certificates, which will be effected without
charge but only upon payment (with such indemnity as the Regular Trustees may
require) in respect of any tax or other government charges that may be imposed
in relation to it. Upon surrender for registration of transfer of any
Certificate, the Regular Trustees shall cause one or more new Certificates to
be issued in the name of the designated transferee or transferees. Every
Certificate surrendered for registration of transfer shall be accompanied by a
written instrument of transfer in form satisfactory to the Regular Trustees
duly executed by the Holder or such Holder's attorney duly authorized in
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writing. Each Certificate surrendered for registration of transfer shall be
canceled by the Regular Trustees. A transferee of a Certificate shall be
entitled to the rights and subject to the obligations of a Holder hereunder
upon the receipt by such transferee of a Certificate. By acceptance of a
Certificate, each transferee shall be deemed to have agreed to be bound by this
Declaration.
Section 9.3 Deemed Security Holders.
The Trustees may treat the Person in whose name any
Certificate shall be registered on the books and records of the Trust as the
sole holder of such Certificate and of the Securities represented by such
Certificate for purposes of receiving Distributions and for all other purposes
whatsoever and, accordingly, shall not be bound to recognize any equitable or
other claim to or interest in such Certificate or in the Securities represented
by such Certificate on the part of any Person, whether or not the Trust shall
have actual or other notice thereof.
Section 9.4 Book Entry Interests.
Unless otherwise specified in the terms of the Preferred
Securities, the Preferred Securities Certificates, on original issuance, will
be issued in the form of one or more, fully registered, global Preferred
Security Certificates (each a "Global Certificate"), to be delivered to DTC,
the initial Clearing Agency, by, or on behalf of, the Trust. Such Global
Certificates shall initially be registered on the books and records of the
Trust in the name of Cede & Co., the nominee of DTC, and no Preferred Security
Beneficial Owner will receive a definitive Preferred Security Certificate
representing such Preferred Security Beneficial Owner's interests in such
Global Certificates, except as provided in Section 9.7. Unless and until
definitive, fully registered Preferred Security Certificates (the "Definitive
Preferred Security Certificates") have been issued to the Preferred Security
Beneficial Owners pursuant to Section 9.7:
(a) the provisions of this Section 9.4 shall be
in full force and effect;
(b) the Trust and the Trustees shall be entitled
to deal with the Clearing Agency for all purposes of this Declaration
(including the payment of Distributions on the Global Certificates and
receiving approvals, votes or consents hereunder) as the Holder of the
Preferred Securities and the sole holder of the Global Certificates and shall
have no obligation to the Preferred Security Beneficial Owners;
(c) to the extent that the provisions of this
Section 9.4 conflict with any other provisions of this Declaration, the
provisions of this Section 9.4 shall control; and
(d) the rights of the Preferred Security
Beneficial Owners shall be exercised only through the Clearing Agency and shall
be limited to those established by law and agreements between such Preferred
Security Beneficial Owners and the Clearing Agency and/or the Clearing Agency
Participants and receive and transmit payments of Distributions on the Global
Certificates to such Clearing Agency Participants. DTC will make book entry
transfers among the Clearing Agency Participants.
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Section 9.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Preferred
Security Holders is required under this Declaration, unless and until
Definitive Preferred Security Certificates shall have been issued to the
Preferred Security Beneficial Owners pursuant to Section 9.7, the Regular
Trustees shall give all such notices and communications specified herein to be
given to the Preferred Security Holders to the Clearing Agency, and shall have
no notice obligations to the Preferred Security Beneficial Owners.
Section 9.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Preferred Securities, the Regular
Trustees may, in their sole discretion, appoint a successor Clearing Agency
with respect to such Preferred Securities.
Section 9.7 Definitive Preferred Security Certificates.
If:
(a) a Clearing Agency elects to discontinue its
services as securities depositary with respect to the Preferred Securities and
a successor Clearing Agency is not appointed within 90 days after such
discontinuance pursuant to Section 9.6; or
(b) the Regular Trustees elect after consultation
with the Sponsor to terminate the book entry system through the Clearing Agency
with respect to the Preferred Securities,
then:
(c) Definitive Preferred Security Certificates
shall be prepared by the Regular Trustees on behalf of the Trust with respect
to such Preferred Securities; and
(d) upon surrender of the Global Certificates by
the Clearing Agency, accompanied by registration instructions, the Regular
Trustees shall cause Definitive Certificates to be delivered to Preferred
Security Beneficial Owners in accordance with the instructions of the Clearing
Agency. Neither the Trustees nor the Trust shall be liable for any delay in
delivery of such instructions and each of them may conclusively rely on and
shall be protected in relying on, said instructions of the Clearing Agency. The
Definitive Preferred Security Certificates shall be printed, lithographed or
engraved or may be produced in any other manner as is reasonably acceptable to
the Regular Trustees, as evidenced by their execution thereof, and may have
such letters, numbers or other marks of identification or designation and such
legends or endorsements as the Regular Trustees may deem appropriate, or as may
be required to comply with any law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on which Preferred
Securities may be listed, or to conform to usage.
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Section 9.8 Mutilated, Destroyed, Lost or Stolen
Certificates.
If:
(a) any mutilated Certificates should be
surrendered to the Regular Trustees, or if the Regular Trustees shall receive
evidence to their satisfaction of the destruction, loss or theft of any
Certificate; and
(b) there shall be delivered to the Regular
Trustees such security or indemnity as may be required by them to keep each of
them harmless.
then, in the absence of notice that such Certificate shall have been acquired
by a bona fide purchaser, any Regular Trustee on behalf of the Trust shall
execute and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like denomination.
In connection with the issuance of any new Certificate under this Section 9.8,
the Regular Trustees may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection therewith.
Any duplicate Certificate issued pursuant to this Section shall constitute
conclusive evidence of an ownership interest in the relevant Securities, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
ARTICLE X
LIMITATION OF LIABILITY OF HOLDERS
OF SECURITIES, TRUSTEES OR OTHERS
Section 10.1 Liability.
(a) Except as expressly set forth in this
Declara- tion, the Securities Guarantees and the terms of the Securities, the
Sponsor shall not be:
(i) personally liable for the return of any
portion of the capital contributions (or any return thereon)
of the Holders of the Securities which shall be made solely
from assets of the Trust; an
(ii) be required to pay to the Trust or to any
Holder of Securities any deficit upon dissolution of the Trust
or otherwise.
(b) The Holder of the Common Securities shall be
liable for all of the debts and obligations of the Trust (other than with
respect to the Securities) to the extent not satisfied out of the Trust's
assets.
(c) Pursuant to Section 3803(a) of the Business
Trust Act, the Holders of the Preferred Securities shall be entitled to the
same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the
State of Delaware.
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Section 10.2 Exculpation.
(a) No Indemnified Person shall be liable,
responsible or accountable in damages or otherwise to the Trust or any Covered
Person for any loss, damage or claim incurred by reason of any act or omission
performed or omitted by such Indemnified Person in good faith on behalf of the
Trust and in a manner such Indemnified Person reasonably believed to be within
the scope of the authority conferred on such Indemnified Person by this
Declaration or by law, except that an Indemnified Person shall be liable for
any such loss, damage or claim incurred by reason of such Indemnified Person's
gross negligence or willful misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully
protected in relying in good faith upon the records of the Trust and upon such
information, opinions, reports or statements presented to the Trust by any
Person as to matters the Indemnified Person reasonably believes are within such
other Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Trust, including information, opinions,
reports or statements as to the value and amount of the assets, liabilities,
profits, losses, or any other facts pertinent to the existence and amount of
assets from which Distributions to Holders of Securities might properly be
paid.
Section 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an
Indemnified Person has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to any other Covered Person, an Indemnified
Person acting under this Declaration shall not be liable to the Trust or to any
other Covered Person for its good faith reliance on the provisions of this
Declaration. The provisions of this Declaration, to the extent that they
restrict the duties and liabilities of an Indemnified Person otherwise existing
at law or in equity (other than the duties imposed on the Institutional Trustee
under the Trust Indenture Act), are agreed by the parties hereto to replace
such other duties and liabilities of such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or
arises between any Covered Persons; or
(ii) whenever this Declaration or any other
agreement contemplated herein or therein provides that an
Indemnified Person shall act in a manner that is, or provides
terms that are, fair and reasonable to the Trust or any Holder
of Securities, the Indemnified Person shall resolve such
conflict of interest, take such action or provide such terms,
considering in each the relative interest of each party
(including its own interest) to such conflict, agreement,
transaction or situation and the benefits and burdens relating
to such interests, any customary or accepted industry
practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the
Indemnified Person, the resolution,
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action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or
any other agreement contemplated herein or of any duty or
obligation of the Indemnified Person at law or in equity or
otherwise.
(c) Whenever in this Declaration an Indemnified
Person is permitted or required to make a decision:
(i) in its "discretion" or under a grant of
similar authority, the Indemnified Person shall be entitled to
consider such interests and factors as it desires, including
its own interests, and shall have no duty or obligation to
give any consideration to any interest of or factors affecting
the Trust or any other Person; or
(ii) in its "good faith" or under another express
standard, the Indemnified Person shall act under such express
standard and shall not be subject to any other or different
standard imposed by this Declaration or by applicable law.
Section 10.4 Indemnification.
(a) (i) The Debenture Issuer shall indemnify, to
the full extent permitted by law, any Company Indemnified 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, whether civil, criminal, administrative
or investigative (other than an action by or in the right of the Trust) by
reason of the fact that he is or was a Company Indemnified Person 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 Trust,
and, with respect to any criminal action or proceeding, had no reasonable cause
to believe his conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that
the Company Indemnified Person did not act in good faith and in a manner which
he reasonably believed to be in or not opposed to the best interests of the
Trust, and, with respect to any criminal action or proceeding, had reasonable
cause to believe that his conduct was unlawful.
(ii) The Debenture Issuer shall indemnify, to the
full extent permitted by law, any Company Indemnified Person
who was or is a party or is threatened to be made a party to
any threatened, pending or completed action or suit by or in
the right of the Trust to procure a judgment in its favor by
reason of the fact that he is or was a Company Indemnified
Person against expenses (including attorneys' fees) actually
and reasonably incurred by him in connection with the defense
or settlement of such action or suit if he
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acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Trust and
except that no such indemnification shall be made in respect
of any claim, issue or matter as to which such Company
Indemnified Person shall have been adjudged to be liable to
the Trust unless and only to the extent that the Court of
Chancery of Delaware or the court in which such action or suit
was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances
of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which such Court of Chancery or
such other court shall deem proper.
(iii) To the extent that a Company Indemnified
Person shall be successful on the merits or otherwise
(including dismissal of an action without prejudice or the
settlement of an action without admission of liability) in
defense of any action, suit or proceeding referred to in
paragraphs (i) and (ii) of this Section 10.4(a), or in defense
of any claim, issue or matter therein, he shall be
indemnified, to the full extent permitted by law, against
expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
(iv) Any indemnification under paragraphs (i) and
(ii) of this Section 10.4(a) (unless ordered by a court) shall
be made by the Debenture Issuer only as authorized in the
specific case upon a determination that indemnification of the
Company Indemnified Person is proper in the circumstances
because he has met the applicable standard of conduct set
forth in paragraphs (i) and (ii). Such determination shall be
made (1) by the Regular Trustees by a majority vote of a
quorum consisting of such Regular Trustees who were not
parties to such action, suit or proceeding, (2) if such a
quorum is not obtainable, or, even if obtainable, if a quorum
of disinterested Regular Trustees so directs, by independent
legal counsel in a written opinion, or (3) by the Common
Security Holder of the Trust.
(v) Expenses (including attorneys' fees) incurred
by a Company Indemnified Person in defending a civil,
criminal, administrative or investigative action, suit or
proceeding referred to in paragraphs (i) and (ii) of this
Section 10.4(a) shall be paid by the Debenture Issuer in
advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of
such Company Indemnified Person to repay such amount if it
shall ultimately be determined that he is not entitled to be
indemnified by the Debenture Issuer as authorized in this
Section 10.4(a).
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Notwithstanding the foregoing, no advance shall be made by the
Debenture Issuer if a determination is reasonably and promptly
made (i) by the Regular Trustees by a majority vote of a
quorum of disinterested Regular Trustees, (ii) if such a
quorum is not obtainable, or, even if obtainable, if a quorum
of disinterested Regular Trustees so directs, by independent
legal counsel in a written opinion or (iii) the Common
Security Holder of the Trust, that, based upon the facts known
to the Regular Trustees, counsel or the Common Security Holder
at the time such determination is made, such Company
Indemnified Person acted in bad faith or in a manner that such
person did not believe to be in or not opposed to the best
interests of the Trust, or, with respect to any criminal
proceeding, that such Company Indemnified Person believed or
had reasonable cause to believe his conduct was unlawful. In
no event shall any advance be made in instances where the
Regular Trustees, independent legal counsel or Common Security
Holder reasonably determine that such person deliberately
breached his duty to the Trust or its Common or Preferred
Security Holders.
(vi) The indemnification and advancement of
expenses provided by, or granted pursuant to, the other
paragraphs of this Section 10.4(a) shall not be deemed
exclusive of any other rights to which those seeking
indemnification and advancement of expenses may be entitled
under any agreement, vote of stockholders or disinterested
directors of the Debenture Issuer or Preferred Security
Holders of the Trust or otherwise, both as to action in his
official capacity and as to action in another capacity while
holding such office. All rights to indemnification under this
Section 10.4(a) shall be deemed to be provided by a contract
between the Debenture Issuer and each Company Indemnified
Person who serves in such capacity at any time while this
Section 10.4(a) is in effect. Any repeal or modification of
this Section 10.4(a) shall not affect any rights or
obligations then existing.
(vii) The Debenture Issuer or the Trust may
purchase and maintain insurance on behalf of any person who is
or was a Company Indemnified Person 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
Debenture Issuer would have the power to indemnify him against
such liability under the provisions of this Section 10.4(a).
(viii) For purposes of this Section 10.4(a),
references to "the Trust" shall include, in addition to the
resulting or surviving entity, any constituent entity
(including any constituent of a
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<PAGE> 44
constituent) absorbed in a consolidation or merger, so that
any person who is or was a director, trustee, officer or
employee of such constituent entity, or is or was serving at
the request of such constituent entity as a director, trustee,
officer, employee or agent of another entity, shall stand in
the same position under the provisions of this Section 10.4(a)
with respect to the resulting or surviving entity as he would
have with respect to such constituent entity if its separate
existence had continued.
(ix) The indemnification and advancement of
expenses provided by, or granted pursuant to, this Section
10.4(a) shall, unless otherwise provided when authorized or
ratified, continue as to a person who has ceased to be a
Company Indemnified Person and shall inure to the benefit of
the heirs, executors and administrators of such a person.
(b) The Debenture Issuer agrees to indemnify the
(i) Institutional Trustee, (ii) the Delaware Trustee, (iii) any Affiliate of
the Institutional Trustee and the Delaware Trustee, and (iv) any officers,
directors, shareholders, members, partners, employees, representatives,
custodians, nominees or agents of the Institutional Trustee and the Delaware
Trustee (each of the Persons in (i) through (iv) being referred to as a
"Fiduciary Indemnified Person") for, and to hold each Fiduciary Indemnified
Person harmless against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration or the trust or trusts hereunder, including the
costs and expenses (including reasonable legal fees and expenses) of defending
itself against or investigating any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. The
obligation to indemnify as set forth in this Section 10.4(b) shall survive the
satisfaction and discharge of this Declaration.
Section 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee and the
Institutional Trustee may engage in or possess an interest in other business
ventures of any nature or description, independently or with others, similar or
dissimilar to the business of the Trust, and the Trust and the Holders of
Securities shall have no rights by virtue of this Declaration in and to such
independent ventures or the income or profits derived therefrom, and the
pursuit of any such venture, even if competitive with the business of the
Trust, shall not be deemed wrongful or improper. No Covered Person, the
Sponsor, the Delaware Trustee, or the Institutional Trustee shall be obligated
to present any particular investment or other opportunity to the Trust even if
such opportunity is of a character that, if presented to the Trust, could be
taken by the Trust, and any Covered Person, the Sponsor, the Delaware Trustee
and the Institutional Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any such
particular investment or other opportunity. Any Covered Person, the Delaware
Trustee and the Institutional Trustee may engage or be interested in any
financial or other transaction with the Sponsor or any Affiliate of the
Sponsor, or may act as depositary for, trustee
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or agent for, or act on any committee or body of holders of, securities or
other obligations of the Sponsor or its Affiliates.
ARTICLE XI
ACCOUNTING
Section 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the
calendar year, or such other year as is required by the Code.
Section 11.2 Certain Accounting Matters.
(a) At all times during the existence of the
Trust, the Regular Trustees shall keep, or cause to be kept, full books of
account, records and supporting documents, which shall reflect in reasonable
detail, each transaction of the Trust. The books of account shall be maintained
on the accrual method of accounting, in accordance with generally accepted
accounting principles, consistently applied. The Trust shall use the accrual
method of accounting for United States federal income tax purposes. The books
of account and the records of the Trust shall be examined by and reported upon
as of the end of each Fiscal Year of the Trust by a firm of independent
certified public accountants selected by the Regular Trustees.
(b) The Regular Trustees shall cause to be
prepared and delivered to each of the Holders of Securities, within 90 days
after the end of each Fiscal Year of the Trust, annual financial statements of
the Trust, including a balance sheet of the Trust as of the end of such Fiscal
Year, and the related statements of income or loss;
(c) The Regular Trustees shall cause to be duly
prepared and delivered to each of the Holders of Securities, any annual United
States federal income tax information statement, required by the Code,
containing such information with regard to the Securities held by each Holder
as is required by the Code and the Treasury Regulations. Notwithstanding any
right under the Code to deliver any such statement at a later date, the Regular
Trustees shall endeavor to deliver all such statements within 30 days after the
end of each Fiscal Year of the Trust.
(d) The Regular Trustees shall cause to be duly
prepared and filed with the appropriate taxing authority, an annual United
States federal income tax return, on a Form 1041 or such other form required by
United States federal income tax law, and any other annual income tax returns
required to be filed by the Regular Trustees on behalf of the Trust with any
state or local taxing authority.
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Section 11.3 Banking.
The Trust shall maintain one or more bank accounts in the name
and for the sole benefit of the Trust; provided, however, that all payments of
funds in respect of the Debentures held by the Institutional Trustee shall be
made directly to the Institutional Trustee Account and no other funds of the
Trust shall be deposited in the Institutional Trustee Account. The sole
signatories for such accounts shall be designated by the Regular Trustees;
provided, however, that the Institutional Trustee shall designate the
signatories for the Institutional Trustee Account.
Section 11.4 Withholding.
The Trust and the Regular Trustees shall comply with all
withholding requirements under United States federal, state and local law. The
Trust shall request, and the Holders shall provide to the Trust, such forms or
certificates as are necessary to establish an exemption from withholding with
respect to each Holder, and any representations and forms as shall reasonably
be requested by the Trust to assist it in determining the extent of, and in
fulfilling, its withholding obligations. The Regular Trustees shall file
required forms with applicable jurisdictions and, unless an exemption from
withholding is properly established by a Holder, shall remit amounts withheld
with respect to the Holder to applicable jurisdictions. To the extent that the
Trust is required to withhold and pay over any amounts to any authority with
respect to distributions or allocations to any Holder, the amount withheld
shall be deemed to be a distribution in the amount of the withholding to the
Holder. In the event of any claimed over withholding, Holders shall be limited
to an action against the applicable jurisdiction. If the amount required to be
withheld was not withheld from actual Distributions made, the Trust may reduce
subsequent Distributions by the amount of such withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
Section 12.1 Amendments.
(a) Except as otherwise provided in this
Declaration or by any applicable terms of the Securities, this Declaration may
only be amended by a written instrument approved and executed by:
(i) the Regular Trustees (or, if there are more
than two Regular Trustees a majority of the Regular Trustees);
(ii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Institutional
Trustee, the Institutional Trustee; and
(iii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Delaware Trustee, the
Delaware Trustee;
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(b) no amendment shall be made, and any such
purported amendment shall be void and ineffective:
(i) unless, in the case of any proposed
amendment, the Institutional Trustee shall have first received
an Officers' Certificate from each of the Trust and the
Sponsor that such amendment is permitted by, and conforms to,
the terms of this Declaration (including the terms of the
Securities);
(ii) unless, in the case of any proposed amendment
which affects the rights, powers, duties, obligations or
immunities of the Institutional Trustee, the Institutional
Trustee shall have first received:
(A) an Officers' Certificate from each of the Trust and
the Sponsor that such amendment is permitted by, and conforms to, the terms of
this Declaration (including the terms of the Securities); and
(B) an opinion of counsel (who may be counsel to the
Sponsor or the Trust) that such amendment is permitted by, and conforms to, the
terms of this Declaration (including the terms of the Securities); and
(iii) to the extent the result of such amendment
would be to:
(A) cause the trust to fail to continue to be classified
for purposes of United States federal income taxation as a grantor trust;
(B) reduce or otherwise adversely affect the powers of
the Institutional Trustee in contravention of the Trust Indenture Act; or
(C) cause the Trust to be deemed to be an Investment
Company required to be registered under the Investment Company Act;
(c) at such time after the Trust has issued any
Securities that remain outstanding, any amendment that would adversely affect
the rights, privileges or preferences of any Holder of Securities may be
effected only with such additional requirements as may be set forth in the
terms of such Securities;
(d) Section 9.1(c) and this Section 12.1 shall
not be amended without the consent of all of the Holders of the Securities;
(e) Article IV shall not be amended without the
con- sent of the Holders of a Majority in liquidation amount of the Common
Securities and;
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(f) the rights of the holders of the Common
Securities under Article V to increase or decrease the number of, and appoint
and remove Trustees shall not be amended without the consent of the Holders of
a Majority in liquidation amount of the Common Securities; and
(g) notwithstanding Section 12.1(c), this
Declaration may be amended without the consent of the Holders of the Securities
to:
(i) cure any ambiguity;
(ii) correct or supplement any provision in this
Declaration that may be defective or inconsistent with any
other provision of this Declaration;
(iii) add to the covenants, restrictions or
obligations of the Sponsor;
(iv) to conform to any change in Rule 3a-5 or
written change in interpretation or application of Rule 3a-5
by any legislative body, court, government agency or
regulatory authority which amendment does not have a material
adverse effect on the right, preferences or privileges of the
Holders; and
(v) to modify, eliminate and add to any provision
of the Amended Declaration to such extent as may be necessary.
Section 12.2 Meetings of the Holders of Securities; Action
by Written Consent.
(a) Meetings of the Holders of any class of
Securities may be called at any time by the Regular Trustees (or as provided in
the terms of the Securities) to consider and act on any matter on which Holders
of such class of Securities are entitled to act under the terms of this
Declaration, the terms of the Securities or the rules of any stock exchange on
which the Preferred Securities are listed or admitted for trading. The Regular
Trustees shall call a meeting of the Holders of such class if directed to do so
by the Holders of at least 10% in liquidation amount of such class of
Securities. Such direction shall be given by delivering to the Regular Trustees
one or more calls in a writing stating that the signing Holders of Securities
wish to call a meeting and indicating the general or specific purpose for which
the meeting is to be called. Any Holders of Securities calling a meeting shall
specify in writing the Security Certificates held by the Holders of Securities
exercising the right to call a meeting and only those Securities specified
shall be counted for purposes of determining whether the required percentage
set forth in the second sentence of this paragraph has been met.
(b) Except to the extent otherwise provided in
the terms of the Securities, the following provisions shall apply to meetings
of Holders of Securities:
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(i) notice of any such meeting shall be given to
all the Holders of Securities having a right to vote thereat
at least 7 days and not more than 60 days before the date of
such meeting. Whenever a vote, consent or approval of the
Holders of Securities is permitted or required under this
Declaration or the rules of any stock exchange on which the
Preferred Securities are listed or admitted for trading, such
vote, consent or approval may be given at a meeting of the
Holders of Securities. Any action that may be taken at a
meeting of the Holders of Securities may be taken without a
meeting if a consent in writing setting forth the action so
taken is signed by the Holders of Securities owning not less
than the minimum amount of Securities in liquidation amount
that would be necessary to authorize or take such action at a
meeting at which all Holders of Securities having a right to
vote thereon were present and voting. Prompt notice of the
taking of action without a meeting shall be given to the
Holders of Securities entitled to vote who have not consented
in writing. The Regular Trustees may specify that any written
ballot submitted to the Security Holder for the purpose of
taking any action without a meeting shall be returned to the
Trust within the time specified by the Regular Trustees;
(ii) each Holder of a Security may authorize any
Person to act for it by proxy on all matters in which a Holder
of Securities is entitled to participate, including waiving
notice of any meeting, or voting or participating at a
meeting. No proxy shall be valid after the expiration of 11
months from the date thereof unless otherwise provided in the
proxy. Every proxy shall be revocable at the pleasure of the
Holder of Securities executing it. Except as otherwise
provided herein, all matters relating to the giving, voting or
validity of proxies shall be governed by the General
Corporation Law of the State of Delaware relating to proxies,
and judicial interpretations thereunder, as if the Trust were
a Delaware corporation and the Holders of the Securities were
stockholders of a Delaware corporation;
(iii) each meeting of the Holders of the Securities
shall be conducted by the Regular Trustees or by such other
Person that the Regular Trustees may designate; and
(iv) unless the Business Trust Act, this
Declaration, the terms of the Securities, the Trust Indenture
Act or the listing rules of any stock exchange on which the
Preferred Securities are then listed or trading, otherwise
provides, the Regular Trustees, in their sole discretion,
shall establish all other provisions relating to meetings of
Holders of Securities, including notice of the time, place or
purpose of any meeting at which any matter is to be voted on
by any Holders
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of Securities, waiver of any such notice, action by consent
without a meeting, the establishment of a record date, quorum
requirements, voting in person or by proxy or any other matter
with respect to the exercise of any such right to vote.
ARTICLE XIII
REPRESENTATIONS OF INSTITUTIONAL TRUSTEE
AND DELAWARE TRUSTEE
Section 13.1 Representations and Warranties of
Institutional Trustee.
The Trustee that acts as initial Institutional Trustee
represents and warrants to the Trust and to the Sponsor at the date of this
Declaration, and each Successor Institutional Trustee represents and warrants
to the Trust and the Sponsor at the time of the Successor Institutional
Trustee's acceptance of its appointment as Institutional Trustee that:
(a) the Institutional Trustee is a national
banking association with trust powers, duly organized, validly existing and in
good standing under the laws of the United States, with trust power and
authority to execute and deliver, and to carry out and perform its obligations
under the terms of, the Declaration;
(b) the execution, delivery and performance by
the Institutional Trustee of the Declaration has been duly authorized by all
necessary corporate action on the part of the Institutional Trustee. The
Declaration has been duly executed and delivered by the Institutional Trustee,
and it constitutes a legal, valid and binding obligation of the Institutional
Trustee, enforceable against it in accordance with its terms, subject to
applicable bankruptcy, reorganization, moratorium, insolvency, and other
similar laws affecting creditors' rights generally and to general principles of
equity and the discretion of the court (regardless of whether the enforcement
of such remedies is considered in a proceeding in equity or at law);
(c) the execution, delivery and performance of
the Declaration by the Institutional Trustee does not conflict with or
constitute a breach of the Articles of Organization or By-laws of the
Institutional Trustee; and
(d) no consent, approval or authorization of, or
registration with or notice to, any State or Federal banking authority is
required for the execution, delivery or performance by the Institutional
Trustee, of the Declaration.
Section 13.2 Representations and Warranties of Delaware
Trustee.
The Trustee that acts as initial Delaware Trustee represents
and warrants to the Trust and to the Sponsor at the date of this Declaration,
and each Successor Delaware Trustee represents and warrants to the Trust and
the Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:
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(a) The Delaware Trustee is a Delaware banking
corporation with trust powers, duly organized, validly existing and in good
standing under the laws of the State of Delaware, with trust power and
authority to execute and deliver, and to carry out and perform its obligations
under the terms of, the Declaration.
(b) The Delaware Trustee has been authorized to
perform its obligations under the Certificate of Trust and the Declaration. The
Declaration under Delaware law constitutes a legal, valid and binding
obligation of the Delaware Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in
equity or at law).
(c) No consent, approval or authorization of, or
registration with or notice to, any State or Federal banking authority is
required for the execution, delivery or performance by the Delaware Trustee, of
the Declaration.
(d) The Delaware Trustee is a natural person who
is a resident of the State of Delaware or, if not a natural person, an entity
which has its principal place of business in the State of Delaware.
ARTICLE XIV
MISCELLANEOUS
Section 14.1 Notices.
All notices provided for in this Declaration shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by registered or certified mail, as follows:
(a) if given to the Trust, in care of the Regular
Trustees at the Trust's mailing address set forth below (or such other address
as the Trust may give notice of to the Holders of the Securities):
Phillips 66 Capital V
c/o Phillips Petroleum Company
Phillips Building
Barklesville, Oklahoma 74004
Attention: _____________
(b) if given to the Delaware Trustee, at the
mailing address set forth below (or such other address as Delaware Trustee may
give notice of to the Holders of the Securities):
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The Bank of New York (Delaware)
White Clay Center, Route 273
Newark, Delaware 19711
Attention: Corporate Trust Trustee
Administration
(c) if given to the Institutional Trustee, at the
Institutional Trustee's mailing address set forth below (or such other address
as the Institutional Trustee may give notice of to the Holders of the
Securities):
The Bank of New York
101 Barclay Street, 21 West
New York, New York 10286
Attention: Corporate Trust Trustee
Administration
(d) if given to the Holder of the Common
Securities, at the mailing address of the Sponsor set forth below (or such
other address as the Holder of the Common Securities may give notice to the
Trust):
Phillips Petroleum Company
Phillips Building
Bartlesville, Oklahoma 74004
Attention: _______________________
(e) if given to any other Holder, at the address
set forth on the books and records of the Trust.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
Section 14.2 Governing Law.
This Declaration and the rights of the parties hereunder shall
be governed by and interpreted in accordance with the laws of the State of
Delaware and all rights and remedies shall be governed by such laws without
regard to principles of conflict of laws.
Section 14.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust be
classified for United States federal income tax purposes as a grantor trust.
The provisions of this Declaration shall be interpreted to further this
intention of the parties.
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<PAGE> 53
Section 14.4 Headings.
Headings contained in this Declaration are inserted for
convenience of reference only and do not affect the interpretation of this
Declaration or any provision hereof.
Section 14.5 Successors and Assigns.
Whenever in this Declaration any of the parties hereto is
named or referred to, the successors and assigns of such party shall be deemed
to be included, and all covenants and agreements in this Declaration by the
Sponsor and the Trustees shall bind and inure to the benefit of their
respective successors and assigns, whether so expressed.
Section 14.6 Partial Enforceability.
If any provision of this Declaration, or the application of
such provision to any Person or circumstance, shall be held invalid, the
remainder of this Declaration, or the application of such provision to persons
or circumstances other than those to which it is held invalid, shall not be
affected thereby.
Section 14.7 Counterparts.
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and they
shall have the same force and effect as though all of the signers had signed a
single signature page.
IN WITNESS WHEREOF, the undersigned has caused these presents
to be executed as of the day and year first above written.
----------------------------------
T.C. Morris, as Regular Trustee
----------------------------------
John A. Carrig, as Regular Trustee
----------------------------------
R.B. Gisi, as Regular Trustee
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THE BANK OF NEW YORK (DELAWARE), as
Delaware Trustee
By:
--------------------------
Name:
Title:
THE BANK OF NEW YORK, as
Institutional Trustee
By:
--------------------------
Name:
Title:
PHILLIPS PETROLEUM COMPANY, as
Sponsor
By:
--------------------------
Name:
Title:
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<PAGE> 55
ANNEX I
TERMS OF
___% TRUST ORIGINATED PREFERRED SECURITIES
___% TRUST ORIGINATED COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated
Declaration of Trust, dated as of _______, 1998 (as amended from time to time,
the "Declaration"), the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Preferred Securities and the
Common Securities are set out below (each capitalized term used but not defined
herein has the meaning set forth in the Declaration or, if not defined in such
Declaration, as defined in the Prospectus referred to below):
1. Designation and Number.
(a) Preferred Securities. [ ]
Preferred Securities of the Trust with an aggregate liquidation amount with
respect to the assets of the Trust of [ ] dollars ($[
]) and a liquidation amount with respect to the assets of the Trust of $25 per
preferred security, are hereby designated for the purposes of identification
only as "_____% Trust Originated Preferred Securities(SM) ('TOPrS'(SM))" ( the
"Preferred Securities"). The Preferred Security Certificates evidencing the
Preferred Securities shall be substantially in the form of Exhibit A-1 to the
Declaration, with such changes and additions thereto or deletions therefrom as
may be required by ordinary usage, custom or practice or to conform to the
rules of any stock exchange on which the Preferred Securities are listed.
(b) Common Securities. [ ] Common
Securities of the Trust with an aggregate liquidation amount with respect to
the assets of the Trust of [ ] dollars ($[ ]) and a
liquidation amount with respect to the assets of the Trust of $25 per common
security, are hereby designated for the purposes of identification only as
"______% Trust Originated Common Securities" (the "Common Securities"). The
Common Security Certificates evidencing the Common Securities shall be
substantially in the form of Exhibit A-2 to the Declaration, with such changes
and additions thereto or deletions therefrom as may be required by ordinary
usage, custom or practice.
2. Distributions.
(a) Distributions payable on each Security will
be fixed at a rate per annum of ______% (the "Coupon Rate") of the stated
liquidation amount of $25 per Security, such rate being the rate of interest
payable on the Debentures to be held by the Institutional Trustee.
Distributions in arrears for more than one quarter will bear interest thereon
compounded quarterly at the Coupon Rate (to the extent permitted by applicable
law). The term "Distributions" as used herein includes such cash distributions
and any such interest payable unless otherwise stated. A Distribution is
payable only to the extent that payments are made in respect of the Debentures
held by the Institutional Trustee and to the extent the Institutional Trustee
has funds available therefor. The amount of Distributions payable for any
period will be
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computed for any full quarterly Distribution period on the basis of a 360-day
year of twelve 30-day months, and for any period shorter than a full quarterly
Distribution period for which Distributions are computed, Distributions will be
computed on the basis of the actual number of days elapsed per 90-day quarter.
(b) Distributions on the Securities will be
cumulative, will accrue from ________, 1998, and will be payable quarterly in
arrears, on [March 31, June 30, September 30, and December 31] of each year,
commencing on _______, 1998, except as otherwise described below. The Debenture
Issuer has the right under the Indenture to defer payments of interest by
extending the interest payment period from time to time on the Debentures for a
period not exceeding 20 consecutive quarters or extend beyond the maturity date
of the Debentures (each an "Extension Period"), during which Extension Period
no interest shall be due and payable on the Debentures, provided that no
Extension Period shall last beyond the date of maturity of the Debentures. As a
consequence of such deferral, Distributions will also be deferred. Despite such
deferral, quarterly Distributions will continue to accrue with interest thereon
(to the extent permitted by applicable law) at the Coupon Rate compounded
quarterly during any such Extension Period. Prior to the termination of any
such Extension Period, the Debenture Issuer may further extend such Extension
Period; provided that such Extension Period together with all such previous and
further extensions thereof may not exceed 20 consecutive quarters or extend
beyond the maturity of the Debentures. Payments of accrued Distributions will
be payable to Holders as they appear on the books and records of the Trust on
the first record date after the end of the Extension Period. Upon the
termination of any Extension Period and the payment of all amounts then due,
the Debenture Issuer may commence a new Extension Period, subject to the above
requirements.
(c) Distributions on the Securities will be
payable to the Holders thereof as they appear on the books and records of the
Trust on the relevant record dates. While the Preferred Securities remain in
book-entry only form, the relevant record dates shall be one Business Day prior
to the relevant payment dates which payment dates correspond to the interest
payment dates on the Debentures. Subject to any applicable laws and regulations
and the provisions of the Declaration, each such payment in respect of the
Preferred Securities will be made as described under the heading "Description
of the Preferred Securities -- Book-Entry Only Issuance -- The Depository Trust
Company" in the Prospectus Supplement dated ______, 1998, to the Prospectus
dated ______, 1998 (together, the "Prospectus"), of the Trust included in the
Registration Statement on Form S-3 of the Sponsor, the Trust and certain other
business trusts. The relevant record dates for the Common Securities shall be
the same record date as for the Preferred Securities. If the Preferred
Securities shall not continue to remain in book-entry only form, the relevant
record dates for the Preferred Securities, shall conform to the rules of any
securities exchange on which the securities are listed and, if none, shall be
selected by the Regular Trustees, which dates shall be at least one Business
Day but less than 60 Business Days before the relevant payment dates, which
payment dates correspond to the interest payment dates on the Debentures.
Distributions payable on any Securities that are not punctually paid on any
Distribution payment date, as a result of the Debenture Issuer having failed to
make a payment under the Debentures, will cease to be payable to the Person in
whose name such Securities are registered on the relevant record date, and such
defaulted Distribution will instead be payable to
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<PAGE> 57
the Person in whose name such Securities are registered on the special record
date or other specified date determined in accordance with the Indenture. If
any date on which Distributions are payable on the Securities is not a Business
Day, then payment of the Distribution payable on such date will be made on the
next succeeding day that is a Business Day (and without any interest or other
payment in respect of any such delay) except that, if such Business Day is in
the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date.
(d) In the event that there is any money or other
property held by or for the Trust that is not accounted for hereunder, such
property shall be distributed Pro Rata (as defined herein) among the Holders of
the Securities.
3. Liquidation Distribution Upon Dissolution.
In the event of any voluntary or involuntary dissolution,
winding-up or termination of the Trust, the Holders of the Securities on the
date of the dissolution, winding-up or termination, as the case may be, will be
entitled to receive out of the assets of the Trust available for distribution
to Holders of Securities after satisfaction of liabilities of creditors an
amount equal to the aggregate of the stated liquidation amount of $25 per
Security plus accrued and unpaid Distributions thereon to the date of payment
(such amount being the "Liquidation Distribution"), unless, in connection with
such dissolution, winding-up or termination, Debentures in an aggregate stated
principal amount equal to the aggregate stated liquidation amount of such
Securities, with an interest rate equal to the Coupon Rate of, and bearing
accrued and unpaid interest in an amount equal to the accrued and unpaid
Distributions on, such Securities, shall be distributed on a Pro Rata basis to
the Holders of the Securities in exchange for such Securities.
If, upon any such dissolution, the Liquidation Distribution
can be paid only in part because the Trust has insufficient assets available to
pay in full the aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on the Securities shall be paid on a Pro Rata basis.
4. Redemption and Distribution.
(a) Upon the repayment of the Debentures in whole
or in part, whether at maturity or upon redemption (either at the option of the
Debenture Issuer or pursuant to a Tax Event as described below), the proceeds
from such repayment or payment shall be simultaneously applied to redeem
Securities having an aggregate liquidation amount equal to the aggregate
principal amount of the Debentures so repaid or redeemed at a redemption price
of $25 per Security plus an amount equal to accrued and unpaid Distributions
thereon at the date of the redemption, payable in cash (the "Redemption
Price"). Holders will be given not less than 30 nor more than 60 days notice of
such redemption.
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<PAGE> 58
(b) If fewer than all the outstanding Securities
are to be so redeemed, the Common Securities and the Preferred Securities will
be redeemed Pro Rata and the Preferred Securities to be redeemed will be as
described in Section 4(f)(ii) below.
(c) If, at any time, a Tax Event (as defined
below) shall occur and be continuing the Regular Trustees shall, except in
certain limited circumstances described in this Section 4(c), dissolve the
Trust and, after satisfaction of creditors, cause Debentures held by the
Institutional Trustee, having an aggregate principal amount equal to the
aggregate stated liquidation amount of, with an interest rate identical to the
Coupon Rate of, and accrued and unpaid interest equal to accrued and unpaid
Distributions on, and having the same record date for payment as the
Securities, to be distributed to the Holders of the Securities in liquidation
of such Holders' interests in the Trust on a Pro Rata basis, within 90 days
following the occurrence of such Tax Event (the "90 Day Period"); provided,
however, that, as a condition of such dissolution and distribution, the Regular
Trustees shall have received an opinion of a nationally recognized independent
tax counsel experienced in such matters (a "No Recognition Opinion"), which
opinion may rely on published revenue rulings of the Internal Revenue Service,
to the effect that the Holders of the Securities will not recognize any gain or
loss for United States federal income tax purposes as a result of the
dissolution of the Trust and the distribution of Debentures, and provided,
further, that, if at the time there is available to the Trust the opportunity
to eliminate, within the 90 Day Period, the Tax Event by taking some
ministerial action, such as filing a form or making an election, or pursuing
some other similar reasonable measure that has no adverse effect on the Trust,
the Debenture Issuer, the Sponsor or the Holders of the Securities
("Ministerial Action"), the Trust will pursue such Ministerial Action in lieu
of dissolution.
If in the event of a Tax Event, (i) after receipt of a Tax
Event Opinion (as defined hereinafter) by the Regular Trustees, the Debenture
Issuer has received an opinion (a "Redemption Tax Opinion") of a nationally
recognized independent tax counsel experienced in such matters that, as a
result of a Tax Event, there is more than an insubstantial risk that the
Debenture Issuer would be precluded from deducting the interest on the
Debentures for United States federal income tax purposes even after the
Debentures were distributed to the Holders of Securities in liquidation of such
Holders' interests in the Trust as described in this Section 4(c), or (ii) the
Regular Trustees shall have been informed by such tax counsel that a No
Recognition Opinion cannot be delivered to the Trust, the Debenture Issuer
shall have the right at any time, upon not less than 30 nor more than 60 days
notice, to redeem the Debentures in whole or in part for cash within 90 days
following the occurrence of such Tax Event, and, following such redemption,
Securities with an aggregate liquidation amount equal to the aggregate
principal amount of the Debentures so redeemed shall be redeemed by the Trust
at the Redemption Price on a Pro Rata basis; provided, however, that, if at the
time there is available to the Debenture Issuer or the Trust the opportunity to
eliminate, within such 90 day period, the Special Event by taking some
Ministerial Action, the Trust or the Debenture Issuer will pursue such
Ministerial Action in lieu of redemption.
"Tax Event" means that the Regular Trustees shall have
received an opinion of a nationally recognized independent tax counsel
experienced in such matters (a "Dissolution Tax
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<PAGE> 59
Opinion") to the effect that on or after the date of the Prospectus Supplement,
as a result of (a) any amendment to, clarification of or change (including any
announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or
therein affecting taxation, (b) any judicial decision, official administrative
pronouncement, ruling, regulatory procedure, notice or announcement, including
any notice or announcement of intent to adopt such procedures or regulations
(an "Administrative Action") or (c) any amendment to, clarification of, or
change in the official position or the interpretation of such Administrative
Action or judicial decision that differs from the theretofore generally
accepted position, in each case, by any legislative body, court, governmental
authority or regulatory body, irrespective of the manner in which such
amendment, clarification or change is made known, which amendment,
clarification, or change is effective or such pronouncement or decision is
announced, in each case, on or after, the first date of issuance of the
Securities, there is more than an insubstantial risk that (i) the Trust is or
will be within 90 days of the date thereof, subject to United States federal
income tax with respect to interest accrued or received on the Debentures, (ii)
the Trust is, or will be within 90 days of the date thereof, subject to more
than a de minimis amount of taxes, duties or other governmental charges, or
(iii) interest payable by the Debenture Issuer to the Trust on the Debentures
is not, or within 90 days of the date thereof will not be, deductible, in whole
or in part, by the Debenture Issuer for United States federal income tax
purposes.
On and from the date fixed by the Regular Trustees for any
distribution of Debentures and dissolution of the Trust: (i) the Securities
will no longer be deemed to be outstanding, (ii) The Depository Trust Company
(the "Depository") or its nominee (or any successor Clearing Agency or its
nominee), as the record Holder of the Preferred Securities, will receive a
registered global certificate or certificates representing the Debentures to be
delivered upon such distribution and any certificates representing Securities,
except for certificates representing Preferred Securities held by the
Depository or its nominee (or any successor Clearing Agency or its nominee),
will be deemed to represent beneficial interests in the Debentures having an
aggregate principal amount equal to the aggregate stated liquidation amount of,
with an interest rate identical to the Coupon Rate of, and accrued and unpaid
interest equal to accrued and unpaid Distributions on such Securities until
such certificates are presented to the Debenture Issuer or its agent for
transfer or reissue.
(d) The Trust may not redeem fewer than all the
outstanding Securities unless all accrued and unpaid Distributions have been
paid on all Securities for all quarterly Distribution periods terminating on or
before the date of redemption.
(e) If the Debentures are distributed to holders
of the Securities, pursuant to the terms of the Indenture, the Debenture Issuer
will use its best efforts to have the Debentures listed on the New York Stock
Exchange or on such other exchange as the Preferred Securities were listed
immediately prior to the distribution of the Debentures.
(f) "Redemption or Distribution Procedures."
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<PAGE> 60
(i) Notice of any redemption of, or notice of
distribution of Debentures in exchange for the Securities (a
"Redemption/Distribution Notice") will be given by the Trust
by mail to each Holder of Securities to be redeemed or
exchanged not fewer than 30 nor more than 60 days before the
date fixed for redemption or exchange thereof which, in the
case of a redemption, will be the date fixed for redemption of
the Debentures. For purposes of the calculation of the date of
redemption or exchange and the dates on which notices are
given pursuant to this Section 4(f)(i), a Redemption/
Distribution Notice shall be deemed to be given on the day
such notice is first mailed by first-class mail, postage
prepaid, to Holders of Securities. Each
Redemption/Distribution Notice shall be addressed to the
Holders of Securities at the address of each such Holder
appearing in the books and records of the Trust. No defect in
the Redemption/Distribution Notice or in the mailing of either
thereof with respect to any Holder shall affect the validity
of the redemption or exchange proceedings with respect to any
other Holder.
(ii) In the event that fewer than all the
outstanding Securities are to be redeemed, the Securities to
be redeemed shall be redeemed Pro Rata from each Holder of
Preferred Securities, it being understood that, in respect of
Preferred Securities registered in the name of and held of
record by the Depository or its nominee (or any successor
Clearing Agency or its nominee) or any nominee, the
distribution of the proceeds of such redemption will be made
to each Clearing Agency Participant (or Person on whose behalf
such nominee holds such securities) in accordance with the
procedures applied by such agency or nominee.
(iii) If Securities are to be redeemed and the
Trust gives a Redemption/Distribution Notice, which notice may
only be issued if the Debentures are redeemed as set out in
this Section 4 (which notice will be irrevocable), then (A)
while the Preferred Securities are in book-entry only form,
with respect to the Preferred Securities, by 12:00 noon, New
York City time, on the redemption date, provided that the
Debenture Issuer has paid the Institutional Trustee a
sufficient amount of cash in connection with the related
redemption or maturity of the Debentures, the Institutional
Trustee will deposit irrevocably with the Depository or its
nominee (or successor Clearing Agency or its nominee) funds
sufficient to pay the applicable Redemption Price with respect
to the Preferred Securities and will give the Depository
irrevocable instructions and authority to pay the Redemption
Price to the Holders of the Preferred Securities, and (B) with
respect to Preferred Securities issued in definitive form
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<PAGE> 61
and Common Securities, provided that the Debenture Issuer has
paid the Institutional Trustee a sufficient amount of cash in
connection with the related redemption or maturity of the
Debentures, the Institutional Trustee will pay the relevant
Redemption Price to the Holders of such Securities by check
mailed to the address of the relevant Holder appearing on the
books and records of the Trust on the redemption date. If a
Redemption/Distribution Notice shall have been given and funds
deposited as required, if applicable, then immediately prior
to the close of business on the date of such deposit, or on
the redemption date, as applicable, distributions will cease
to accrue on the Securities so called for redemption and all
rights of Holders of such Securities so called for redemption
will cease, except the right of the Holders of such Securities
to receive the Redemption Price, but without interest on such
Redemption Price. Neither the Regular Trustees nor the Trust
shall be required to register or cause to be registered the
transfer of any Securities that have been so called for
redemption. If any date fixed for redemption of Securities is
not a Business Day, then payment of the Redemption Price
payable on such date will be made on the next succeeding day
that is a Business Day (and without any interest or other
payment in respect of any such delay) except that, if such
Business Day falls in the next calendar year, such payment
will be made on the immediately preceding Business Day, in
each case with the same force and effect as if made on such
date fixed for redemption. If payment of the Redemption Price
in respect of any Securities is improperly withheld or refused
and not paid either by the Institutional Trustee or by the
Sponsor as guarantor pursuant to the relevant Securities
Guarantee, Distributions on such Securities will continue to
accrue from the original redemption date to the actual date of
payment, in which case the actual payment date will be
considered the date fixed for redemption for purposes of
calculating the Redemption Price.
(iv) Redemption/Distribution Notices shall be sent
by the Regular Trustees on behalf of the Trust to (A) in
respect of the Preferred Securities, the Depository or its
nominee (or any successor Clearing Agency or its nominee) if
the Global Certificates have been issued or, if Definitive
Preferred Security Certificates have been issued, to the
Holder thereof, and (B) in respect of the Common Securities to
the Holder thereof.
(v) Subject to the foregoing and applicable law
(including, without limitation, United States federal
securities laws), provided the acquiror is not the Holder of
the Common Securities or the obligor under the Indenture, the
Sponsor or any of its subsidiaries
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<PAGE> 62
may at any time and from time to time purchase outstanding
Preferred Securities by tender, in the open market or by
private agreement.
5. Voting Rights - Preferred Securities.
(a) Except as provided under Sections 5(b) and 7
and as otherwise required by law and the Declaration, the Holders of the
Preferred Securities will have no voting rights.
(b) Subject to the requirements set forth in this
paragraph, the Holders of a majority in aggregate liquidation amount of the
Preferred Securities, voting separately as a class may direct the time, method,
and place of conducting any proceeding for any remedy available to the
Institutional Trustee, or exercising any trust or power conferred upon the
Institutional Trustee under the Declaration, including the right to direct the
Institutional Trustee, as holder of the Debentures, to (i) exercise the
remedies available under the Indenture conducting any proceeding for any remedy
available to the Debenture Trustee, or exercising any trust or power conferred
on the Debenture Trustee with respect to the Debentures, (ii) waive any past
default and its consequences that is waivable under Section ___ of the
Indenture, or (iii) exercise any right to rescind or annul a declaration that
the principal of all the Debentures shall be due and payable, provided,
however, that, where a consent under the Indenture would require the consent or
act of the Holders of greater than a majority of the Holders in principal
amount of Debentures affected thereby, (a "Super Majority"), the Institutional
Trustee may only give such consent or take such action at the written direction
of the Holders of at least the proportion in liquidation amount of the
Preferred Securities which the relevant Super Majority represents of the
aggregate principal amount of the Debentures outstanding. The Institutional
Trustee shall not revoke any action previously authorized or approved by a vote
of the Holders of the Preferred Securities. Other than with respect to
directing the time, method and place of conducting any remedy available to the
Institutional Trustee or the Debenture Trustee as set forth above, the
Institutional Trustee shall not take any action in accordance with the
directions of the Holders of the Preferred Securities under this paragraph
unless the Institutional Trustee has obtained an opinion of tax counsel to the
effect that for the purposes of United States federal income tax the Trust will
not be classified as other than a grantor trust on account of such action. If a
Declaration Event of Default has occurred and is continuing and such event is
attributable to the failure of the Debenture Issuer to pay interest or
principal on the Debentures on the date such interest or principal is otherwise
payable (or in the case of redemption, on the redemption date), then a holder
of Preferred Securities may directly institute a proceeding for enforcement of
payment to such Holder of the principal of or interest on the Debentures having
a principal amount equal to the aggregate liquidation amount of the Preferred
Securities of such holder (a "Direct Action") on or after the respective due
date specified in the Debentures. In connection with such Direct Action, the
rights of the holders of the Common Securities Holder will be subrogated to the
rights of such holder of Preferred Securities to the extent of any payment made
by the Issuer to such holder of Preferred Securities in such Direct Action.
Except as provided in the preceding sentences, the Holders of Preferred
Securities will not be able to exercise directly
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<PAGE> 63
any other remedy available to the holders of the Debentures. Any approval or
direction of Holders of Preferred Securities may be given at a separate meeting
of Holders of Preferred Securities convened for such purpose, at a meeting of
all of the Holders of Securities in the Trust or pursuant to written consent.
The Regular Trustees will cause a notice of any meeting at which Holders of
Preferred Securities are entitled to vote, or of any matter upon which action
by written consent of such Holders is to be taken, to be mailed to each Holder
of record of Preferred Securities. Each such notice will include a statement
setting forth (i) the date of such meeting or the date by which such action is
to be taken, (ii) a description of any resolution proposed for adoption at such
meeting on which such Holders are entitled to vote or of such matter upon which
written consent is sought and (iii) instructions for the delivery of proxies or
consents.
No vote or consent of the Holders of the Preferred Securities
will be required for the Trust to redeem and cancel Preferred Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
Notwithstanding that Holders of Preferred Securities are
entitled to vote or consent under any of the circumstances described above, any
of the Preferred Securities that are owned by the Sponsor or any Affiliate of
the Sponsor shall not be entitled to vote or consent and shall, for purposes of
such vote or consent, be treated as if they were not outstanding.
6. Voting Rights - Common Securities.
(a) Except as provided under Sections 7(b), (c)
and 8 as otherwise required by law and the Declaration, the Holders of the
Common Securities will have no voting rights.
(b) The Holders of the Common Securities are
entitled, in accordance with Article V of the Declaration, to vote to appoint,
remove or replace any Trustee or to increase or decrease the number of
Trustees.
(c) Subject to Section 2.6 of the Declaration and
only after the Event of Default with respect to the Preferred Securities has
been cured, waived, or otherwise eliminated and subject to the requirements of
the second to last sentence of this paragraph, the Holders of a Majority in
liquidation amount of the Common Securities, voting separately as a class, may
direct the time, method, and place of conducting any proceeding for any remedy
available to the Institutional Trustee, or exercising any trust or power
conferred upon the Institutional Trustee under the Declaration, including (i)
directing the time, method, place of conducting any proceeding for any remedy
available to the Debenture Trustee, or exercising any trust or power conferred
on the Debenture Trustee with respect to the Debentures, (ii) waive any past
default and its consequences that is waivable under Section ____ of the
Indenture, or (iii) exercise any right to rescind or annul a declaration that
the principal of all the Debentures shall be due and payable, provided that,
where a consent or action under the Indenture would require the consent or act
of the Holders of greater than a majority in principal amount of Debentures
affected thereby (a "Super Majority"), the Institutional Trustee may only give
such consent or take such action at the written direction of the Holders of at
least the proportion in liquidation
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<PAGE> 64
amount of the Common Securities which the relevant Super Majority represents of
the aggregate principal amount of the Debentures outstanding. Pursuant to this
Section 6(c), the Institutional Trustee shall not revoke any action previously
authorized or approved by a vote of the Holders of the Preferred Securities.
Other than with respect to directing the time, method and place of conducting
any remedy available to the Institutional Trustee or the Debenture Trustee as
set forth above, the Institutional Trustee shall not take any action in
accordance with the directions of the Holders of the Common Securities under
this paragraph unless the Institutional Trustee has obtained an opinion of tax
counsel to the effect that for the purposes of United States federal income tax
the Trust will not be classified as other than a grantor trust on account of
such action. If the Institutional Trustee fails to enforce its rights under the
Declaration, any Holder of Common Securities may institute a legal proceeding
directly against any Person to enforce the Institutional Trustee's rights under
the Declaration, without first instituting a legal proceeding against the
Institutional Trustee or any other Person.
Any approval or direction of Holders of Common Securities may
be given at a separate meeting of Holders of Common Securities convened for
such purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Regular Trustees will cause a notice of any
meeting at which Holders of Common Securities are entitled to vote, or of any
matter upon which action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of Common Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the date by
which such action is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such Holders are entitled to vote or of
such matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or consents.
No vote or consent of the Holders of the Common Securities
will be required for the Trust to redeem and cancel Common Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
7. Amendments to Declaration and Indenture.
(a) In addition to any requirements under Section
12.1 of the Declaration, if any proposed amendment to the Declaration provides
for, or the Regular Trustees otherwise propose to effect, (i) any action that
would adversely affect the powers, preferences or special rights of the
Securities, whether by way of amendment to the Declaration or otherwise, or
(ii) the dissolution, winding-up or termination of the Trust, other than as
described in Section 8.1 of the Declaration, then the Holders of outstanding
Securities voting together as a single class, will be entitled to vote on such
amendment or proposal (but not on any other amendment or proposal) and such
amendment or proposal shall not be effective except with the approval of the
Holders of at least a Majority in liquidation amount of the Securities,
affected thereby, provided, however, if any amendment or proposal referred to
in clause (i) above would adversely affect only the Preferred Securities or
only the Common Securities, then only the affected class will be entitled to
vote on such amendment or proposal and such amendment or proposal shall not be
effective except with the approval of a Majority in liquidation amount of such
class of Securities.
- 10 -
<PAGE> 65
(b) In the event the consent of the Institutional
Trustee as the holder of the Debentures is required under the Indenture with
respect to any amendment, modification or termination on the Indenture or the
Debentures, the Institutional Trustee shall request the written direction of
the Holders of the Securities with respect to such amendment, modification or
termination and shall vote with respect to such amendment, modification or
termination as directed by a Majority in liquidation amount of the Securities
voting together as a single class; provided, however, that where a consent
under the Indenture would require the consent of the holders of greater than a
majority in aggregate principal amount of the Debentures (a "Super Majority"),
the Institutional Trustee may only give such consent at the direction of the
Holders of at least the proportion in liquidation amount of the Securities
which the relevant Super Majority represents of the aggregate principal amount
of the Debentures outstanding; provided, further, that the Institutional
Trustee shall not take any action in accordance with the directions of the
Holders of the Securities under this Section 7(b) unless the Institutional
Trustee has obtained an opinion of tax counsel to the effect that for the
purposes of United States federal income tax the Trust will not be classified
as other than a grantor trust on account of such action.
8. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each
Holder of Securities according to the aggregate liquidation amount of the
Securities held by the relevant Holder in relation to the aggregate liquidation
amount of all Securities outstanding unless, in relation to a payment, an Event
of Default under the Declaration has occurred and is continuing, in which case
any funds available to make such payment shall be paid first to each Holder of
the Preferred Securities pro rata according to the aggregate liquidation amount
of Preferred Securities held by the relevant Holder relative to the aggregate
liquidation amount of all Preferred Securities outstanding, and only after
satisfaction of all amounts owed to the Holders of the Preferred Securities, to
each Holder of Common Securities pro rata according to the aggregate
liquidation amount of Common Securities held by the relevant Holder relative to
the aggregate liquidation amount of all Common Securities outstanding.
9. Ranking.
The Preferred Securities rank pari passu and payment thereon
shall be made Pro Rata with the Common Securities except that, where a
Declaration Event of Default occurs and is continuing the rights of Holders of
the Common Securities to payment in respect of Distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights to payment
of the Holders of the Preferred Securities.
10. Listing.
The Regular Trustees shall use their best efforts to cause the
Preferred Securities to be listed for quotation on the New York Stock Exchange,
Inc.
- 11 -
<PAGE> 66
11. Acceptance of Securities Guarantee and
Indenture.
Each Holder of Preferred Securities and Common Securities, by
the acceptance thereof, agrees to the provisions of the Preferred Securities
Guarantee and the Common Securities Guarantee, respectively, including the
subordination provisions therein and to the provisions of the Indenture.
12. No Preemptive Rights.
The Holders of the Securities shall have no preemptive rights
to subscribe for any additional securities.
13. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the
Preferred Securities Guarantee or the Common Securities Guarantee (as may be
appropriate), and the Indenture to a Holder without charge on written request
to the Sponsor at its principal place of business.
- 12 -
<PAGE> 67
EXHIBIT A-1
FORM OF PREFERRED SECURITY CERTIFICATE
This Preferred Security is a Global Certificate within the
meaning of the Declaration hereinafter referred to and is registered in the
name of The Depository Trust Company (the "Depositary") or a nominee of the
Depositary. This Preferred Security is exchangeable for Preferred Securities
registered in the name of a person other than the Depositary or its nominee
only in the limited circumstances described in the Declaration and no transfer
of this Preferred Security (other than a transfer of this Preferred Security as
a whole by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary) may be
registered except in limited circumstances.
Unless this Preferred Security is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New York, New
York) to the Trust or its agent for registration of transfer, exchange or
payment, and any Preferred Security issued is registered in the name of Cede &
Co. or such other name as requested by an authorized representative of The
Depository Trust Company and any payment hereon is made to Cede & Co., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.
Certificate Number Number of Preferred Securities
CUSIP NO. [ ]
Certificate Evidencing Preferred Securities
of
PHILLIPS 66 CAPITAL V
____% Trust Originated Preferred Securities(SM) ("TOPrS"(SM))
(liquidation amount $25 per Preferred Security)
PHILLIPS 66 CAPITAL V, a statutory business trust formed under the laws of the
State of Delaware (the "Trust"), hereby certifies that ______________ (the
"Holder") is the registered owner of preferred securities of the Trust
representing undivided beneficial interests in the assets of the Trust
designated the _____% Trust Originated Preferred Securities(SM) (liquidation
amount $25 per Preferred Security) (the "Preferred Securities"). The Preferred
Securities are transferable on the books and records of the Trust, in person or
by a duly authorized attorney, upon surrender of this certificate duly endorsed
and in proper form for transfer. The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Preferred
Securities represented hereby are issued and shall in all respects be subject
to the provisions of the
- 1 -
<PAGE> 68
Amended and Restated Declaration of Trust of the Trust dated as of _______,
1998, as the same may be amended from time to time (the "Declaration"),
including the designation of the terms of the Preferred Securities as set forth
in Annex I to the Declaration. Capitalized terms used herein but not defined
shall have the meaning given them in the Declaration. The Holder is entitled
to the benefits of the Preferred Securities Guarantee to the extent provided
therein. The Sponsor will provide a copy of the Declaration, the Preferred
Securities Guarantee and the Indenture to a Holder without charge upon written
request to the Trust at its principal place of business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Preferred
Securities as evidence of indirect beneficial ownership in the Debentures.
IN WITNESS WHEREOF, the Trust has executed this certificate
this ___ day of , 1998.
PHILLIPS 66 CAPITAL V
By:
--------------------------
Name:
Title: Regular Trustee
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Preferred Security will be fixed
at a rate per annum of ______% (the "Coupon Rate") of the stated liquidation
amount of $__ per Preferred Security, such rate being the rate of interest
payable on the Debentures to be held by the Institutional Trustee.
Distributions in arrears for more than one quarter will bear interest thereon
compounded quarterly at the Coupon Rate (to the extent permitted by applicable
law). The term "Distributions" as used herein includes such cash distributions
and any such interest payable unless otherwise stated. A Distribution is
payable only to the extent that payments are made in respect of the Debentures
held by the Institutional Trustee and to the extent the Institutional Trustee
has funds available therefor. The amount of Distributions payable for any
period will be computed for any full quarterly Distribution period on the basis
of a 360-day year of twelve 30-day months, and for any period shorter than a
full quarterly Distribution period for which Distributions are computed,
Distributions will be computed on the basis of the actual number of days
elapsed per 90-day quarter.
- 2 -
<PAGE> 69
Except as otherwise described below, distributions on the
Preferred Securities will be cumulative, will accrue from the date of original
issuance and will be payable quarterly in arrears, on [March 31, June 30,
September 30 and December 31] of each year, commencing on ________, 1998, to
[Holders of record fifteen (15) days prior to such payment dates, which payment
dates shall correspond to the interest payment dates on the Debentures.] The
Debenture Issuer has the right under the Indenture to defer payments of
interest by extending the interest payment period from time to time on the
Debentures for a period not exceeding 20 consecutive quarters (each an
"Extension Period"), provided that no Extension Period shall last beyond the
date of the maturity of the Debentures and as a consequence of such deferral,
Distributions will also be deferred. Despite such deferral, quarterly
Distributions will continue to accrue with interest thereon (to the extent
permitted by applicable law) at the Coupon Rate compounded quarterly during any
such Extension Period. Prior to the termination of any such Extension Period,
the Debenture Issuer may further extend such Extension Period; provided that
such Extension Period together with all such previous and further extensions
thereof may not exceed 20 consecutive quarters or extend beyond the maturity of
the Debentures. Payments of accrued Distributions will be payable to Holders as
they appear on the books and records of the Trust on the first record date
after the end of the Extension Period. Upon the termination of any Extension
Period and the payment of all amounts then due, the Debenture Issuer may
commence a new Extension Period, subject to the above requirements.
The Preferred Securities shall be redeemable as provided in
the Declaration.
- 3 -
<PAGE> 70
_______________
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security Certificate to
-----------------------------------------------------------------
(Insert assignee's social security or tax identification number)
-----------------------------------------------------------------
-----------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
-----------------------------------------------------------------
-----------------------------------------------------------------
agent to transfer this Preferred Security Certificate on the books of the
Trust. The agent may substitute another to act for him or her.
Date:
-------------------
Signature:
----------------------------
(Sign exactly as your name appears on the other side of this Preferred Security
Certificate)
- 1 -
<PAGE> 71
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE
Certificate Number Number of Common Securities
Certificate Evidencing Common Securities
of
PHILLIPS 66 CAPITAL V
______% Trust Originated Common Securities
(liquidation amount $25 per Common Security)
PHILLIPS 66 CAPITAL V, a statutory business trust formed under
the laws of the State of Delaware (the "Trust"), hereby certifies that
_________________ (the "Holder") is the registered owner of common securities
of the Trust representing undivided beneficial interests in the assets of the
Trust designated the ______% Trust Originated Common Securities (liquidation
amount $25 per Common Security) (the "Common Securities"). The Common
Securities are transferable on the books and records of the Trust, in person or
by a duly authorized attorney, upon surrender of this certificate duly endorsed
and in proper form for transfer. The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Common
Securities represented hereby are issued and shall in all respects be subject
to the provisions of the Amended and Restated Declaration of Trust of the Trust
dated as of _______, 1998, as the same may be amended from time to time (the
"Declaration"), including the designation of the terms of the Common Securities
as set forth in Annex I to the Declaration. Capitalized terms used herein but
not defined shall have the meaning given them in the Declaration. The Holder is
entitled to the benefits of the Common Securities Guarantee to the extent
provided therein. The Sponsor will provide a copy of the Declaration, the
Common Securities Guarantee and the Indenture to a Holder without charge upon
written request to the Sponsor at its principal place of business.
Upon receipt of this certificate, the Sponsor is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Common
Securities as evidence of indirect beneficial ownership in the Debentures.
- 1 -
<PAGE> 72
IN WITNESS WHEREOF, the Trust has executed this certificate
this ___ day of , 1998.
PHILLIPS 66 CAPITAL V
By:
----------------------------
Name:
Title: Regular Trustee
- 2 -
<PAGE> 73
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Common Security will be fixed at
a rate per annum of ______% (the "Coupon Rate") of the stated liquidation
amount of $__ per Common Security, such rate being the rate of interest payable
on the Debentures to be held by the Institutional Trustee. Distributions in
arrears for more than one quarter will bear interest thereon compounded
quarterly at the Coupon Rate (to the extent permitted by applicable law). The
term "Distributions" as used herein includes such cash distributions and any
such interest payable unless otherwise stated. A Distribution is payable only
to the extent that payments are made in respect of the Debentures held by the
Institutional Trustee and to the extent the Institutional Trustee has funds
available therefor. The amount of Distributions payable for any period will be
computed for any full quarterly Distribution period on the basis of a 360-day
year of twelve 30-day months, and for any period shorter than a full quarterly
Distribution period for which Distributions are computed, Distributions will be
computed on the basis of the actual number of days elapsed per 90-day quarter.
Except as otherwise described below, distributions on the
Common Securities will be cumulative, will accrue from the date of original
issuance and will be payable quarterly in arrears, on [March 31, June 30,
September 30 and December 31] of each year, commencing on ________, 1998, to
Holders of record fifteen (15) days prior to such payment dates, which payment
dates shall correspond to the interest payment dates on the Debentures. The
Debenture Issuer has the right under the Indenture to defer payments of
interest by extending the interest payment period from time to time on the
Debentures for a period not exceeding 20 consecutive quarters (each an
"Extension Period"), provided that no Extension Period shall last beyond the
date of the maturity of the Debentures and as a consequence of such deferral,
Distributions will also be deferred. Despite such deferral, quarterly
Distributions will continue to accrue with interest thereon (to the extent
permitted by applicable law) at the Coupon Rate compounded quarterly during any
such Extension Period. Prior to the termination of any such Extension Period,
the Debenture Issuer may further extend such Extension Period; provided that
such Extension Period together with all such previous and further extensions
thereof may not exceed 20 consecutive quarters or extend beyond the maturity
date of the Debentures. Payments of accrued Distributions will be payable to
Holders as they appear on the books and records of the Trust on the first
record date after the end of the Extension Period. Upon the termination of any
Extension Period and the payment of all amounts then due, the Debenture Issuer
may commence a new Extension Period, subject to the above requirements.
The Common Securities shall be redeemable as provided in the
Declaration.
- 3 -
<PAGE> 74
_______________
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Common
Security Certificate to:
-------------------------------------------------------
-----------------------------------------------------------------
(Insert assignee's social security or tax identification number)
-----------------------------------------------------------------
-----------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
-----------------------------------------------------------------
-----------------------------------------------------------------
agent to transfer this Common Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.
Date:
-------------------
Signature:
----------------------------
(Sign exactly as your name appears on the other side of this Preferred Security
Certificate)
- 1 -
<PAGE> 75
EXHIBIT B
SPECIMEN OF DEBENTURE
<PAGE> 76
EXHIBIT C
UNDERWRITING AGREEMENT
C-1
<PAGE> 1
EXHIBIT 4-N
========================================
AMENDED AND RESTATED DECLARATION
OF TRUST
PHILLIPS 66 CAPITAL VI
Dated as of __________ __, 1998
========================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<S> <C>
ARTICLE I INTERPRETATION AND DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.1 Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II TRUST INDENTURE ACT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.1 Trust Indenture Act; Application. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.2 Lists of Holders of Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.3 Reports by the Institutional Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2.4 Periodic Reports to Institutional Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2.5 Evidence of Compliance with Conditions Precedent. . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2.6 Events of Default; Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2.7 Event of Default; Notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE III ORGANIZATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 3.1 Name. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 3.2 Office. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.3 Purpose. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.4 Authority. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.5 Title to Property of the Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.6 Powers and Duties of the Regular Trustees. . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.7 Prohibition of Actions by the Trust and the Trustees. . . . . . . . . . . . . . . . . . . . . . 14
Section 3.8 Powers and Duties of the Institutional Trustee. . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 3.9 Certain Duties and Responsibilities of the Institutional Trustee. . . . . . . . . . . . . . . . 17
Section 3.10 Certain Rights of Institutional Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 3.11 Delaware Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 3.12 Execution of Documents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 3.13 Not Responsible for Recitals or Issuance of Securities. . . . . . . . . . . . . . . . . . . . . 22
Section 3.14 Duration of Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 3.15 Mergers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE IV SPONSOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 4.1 Sponsor's Purchase of Common Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 4.2 Responsibilities of the Sponsor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE V TRUSTEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 5.1 Number of Trustees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 5.2 Delaware Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 5.3 Institutional Trustee; Eligibility. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 5.4 Certain Qualifications of Regular Trustees and Delaware Trustee Generally. . . . . . . . . . . . 27
Section 5.5 Regular Trustees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 5.6 Delaware Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 5.7 Appointment, Removal and Resignation of Trustees. . . . . . . . . . . . . . . . . . . . . . . . 27
Section 5.8 Vacancies among Trustees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 5.9 Effect of Vacancies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 5.10 Meetings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 5.11 Delegation of Power. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 5.12 Merger, Conversion, Consolidation or Succession to Business. . . . . . . . . . . . . . . . . . . 30
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
ARTICLE VI DISTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 6.1 Distributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE VII ISSUANCE OF SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 7.1 General Provisions Regarding Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 7.2 Paying Agent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
ARTICLE VIII TERMINATION OF TRUST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 8.1 Termination of Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
ARTICLE IX TRANSFER OF INTERESTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 9.1 Transfer of Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 9.2 Transfer of Certificates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 9.3 Deemed Security Holders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 9.4 Book Entry Interests. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 9.5 Notices to Clearing Agency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 9.6 Appointment of Successor Clearing Agency. . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 9.7 Definitive Preferred Security Certificates. . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 9.8 Mutilated, Destroyed, Lost or Stolen Certificates. . . . . . . . . . . . . . . . . . . . . . . . 35
ARTICLE X LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR OTHERS . . . . . . . . . . . . . . . . . . . 36
Section 10.1 Liability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 10.2 Exculpation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 10.3 Fiduciary Duty. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 10.4 Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 10.5 Outside Businesses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
ARTICLE XI ACCOUNTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 11.1 Fiscal Year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 11.2 Certain Accounting Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 11.3 Banking. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 11.4 Withholding. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE XII AMENDMENTS AND MEETINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 12.1 Amendments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 12.2 Meetings of the Holders of Securities; Action by Written Consent. . . . . . . . . . . . . . . . 45
ARTICLE XIII REPRESENTATIONS OF INSTITUTIONAL TRUSTEE AND DELAWARE TRUSTEE . . . . . . . . . . . . . . . . . . . . . 47
Section 13.1 Representations and Warranties of Institutional Trustee. . . . . . . . . . . . . . . . . . . . . 47
Section 13.2 Representations and Warranties of Delaware Trustee. . . . . . . . . . . . . . . . . . . . . . . 47
ARTICLE XIV MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 14.1 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 14.2 Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 14.3 Intention of the Parties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 14.4 Headings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 14.5 Successors and Assigns. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 14.6 Partial Enforceability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 14.7 Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
</TABLE>
<PAGE> 4
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
PHILLIPS 66 CAPITAL VI
_________ ___, 1998
AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration")
dated and effective as of __________ __, 1998, by the Trustees (as defined
herein), the Sponsor (as defined herein) and by the holders, from time to time,
of undivided beneficial interests in the Trust to be issued pursuant to this
Declaration;
WHEREAS, the Trustees and the Sponsor established Phillips 66
Capital VI (the "Trust"), a trust under the Delaware Business Trust Act
pursuant to a Declaration of Trust dated as of February 23, 1998 (the "Original
Declaration"), and a Certificate of Trust filed with the Secretary of State of
the State of Delaware on _________ ____, 1998, for the sole purpose of issuing
and selling certain securities representing undivided beneficial interests in
the assets of the Trust and investing the proceeds thereof in certain
Debentures of the Debenture Issuer;
WHEREAS, as of the date hereof, no interests in the Trust have
been issued;
WHEREAS, all of the Trustees and the Sponsor, by this
Declaration, amend and restate each and every term and provision of the
Original Declaration; and
NOW, THEREFORE, it being the intention of the parties hereto
to continue the Trust as a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust,
the Trustees declare that all assets contributed to the Trust will be held in
trust for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.
ARTICLE I
INTERPRETATION AND DEFINITIONS
Section 1.1 Definitions.
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration
but not defined in the preamble above have the respective meanings assigned to
them in this Section 1.1;
(b) a term defined anywhere in this Declaration
has the same meaning throughout;
(c) all references to "the Declaration" or "this
Declaration" are to this Declaration as modified, supplemented or amended from
time to time;
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<PAGE> 5
(d) all references in this Declaration to
Articles and Sections and Annexes and Exhibits are to Articles and Sections of
and Annexes and Exhibits to this Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has
the same meaning when used in this Declaration unless otherwise defined in this
Declaration or unless the context otherwise requires; and
(f) a reference to the singular includes the
plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act or any successor rule thereunder.
"Agent" means any Paying Agent.
"Authorized Officer" of a Person means any Person that is
authorized to bind such Person.
"Book Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 9.4.
"Business Day" means any day other than a day on which banking
institutions in New York, New York are authorized or required by law to close.
"Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801 et seq., as it may be amended from
time to time, or any successor legislation.
"Certificate" means a Common Security Certificate or a
Preferred Security Certificate.
"Clearing Agency" means an organization registered as a
"Clearing Agency" pursuant to Section 17A of the Exchange Act that is acting as
depositary for the Preferred Securities and in whose name or in the name of a
nominee of that organization shall be registered a Global Certificate and which
shall undertake to effect book entry transfers and pledges of the Preferred
Securities.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time the
Clearing Agency effects book entry transfers and pledges of securities
deposited with the Clearing Agency.
"Closing Date" means the "Closing Time" and each "Date of
Delivery" under the Underwriting Agreement.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, or any successor legislation.
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<PAGE> 6
"Commission" means the Securities and Exchange Commission.
"Common Securities" has the meaning specified in Section
7.1.(a).
"Common Securities Guarantee" means the guarantee agreement to
be dated as of ___________, 1998 of the Sponsor in respect of the Common
Securities.
"Common Security" has the meaning specified in Section 7.1.
"Common Security Certificate" means a definitive certificate
in fully registered form representing a Common Security substantially in the
form of Exhibit A-2.
"Company Indemnified Person" means (a) any Regular Trustee;
(b) any Affiliate of any Regular Trustee; (c) any officers, directors,
shareholders, members, partners, employees, representatives or agents of any
Regular Trustee; or (d) any officer, employee or agent of the Trust or its
Affiliates.
"Corporate Trust Office" means the office of the Institutional
Trustee at which the corporate trust business of the Preferred Guarantee
Trustee shall, at any particular time, be principally administered, which
office at the date of execution of this Agreement is located at White Clay
Center, Route 273, Newark, Delaware 19711.
"Covered Person" means: (a) any officer, director,
shareholder, partner, member, representative, employee or agent of (i) the
Trust or (ii) the Trust's Affiliates; and (b) any Holder of Securities.
"Debenture Issuer" means Phillips Petroleum Company, a
Delaware corporation, in its capacity as issuer of the Debentures under the
Indenture.
"Debenture Trustee" means The Bank of New York, a New York
banking corporation, as trustee under the Indenture until a successor is
appointed thereunder, and thereafter means such successor trustee.
"Debentures" means the series of Debentures to be issued by
the Debenture Issuer under the Indenture to be held by the Institutional
Trustee, a specimen certificate for such series of Debentures being Exhibit B.
"Delaware Trustee" has the meaning set forth in Section 5.2.
"Definitive Preferred Security Certificates" has the meaning
set forth in Section 9.4.
"Distribution" means a distribution payable to Holders of
Securities in accordance with Section 6.1.
"DTC" means The Depository Trust Company, the initial Clearing
Agency.
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<PAGE> 7
"Event of Default" in respect of the Securities means an Event
of Default (as defined in the Indenture) has occurred and is continuing in
respect of the Debentures.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor legislation.
"Fiduciary Indemnified Person" has the meaning set forth in
Section 10.4(b).
"Global Certificate" has the meaning set forth in Section 9.4.
"Holder" means a Person in whose name a Certificate
representing a Security is registered, such Person being a beneficial owner
within the meaning of the Business Trust Act.
"Indemnified Person" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the Indenture dated as of _______, 1998,
among the Debenture Issuer and the Debenture Trustee, and any indenture
supplemental thereto pursuant to which the Debentures are to be issued.
"Institutional Trustee" means the Trustee meeting the
eligibility requirements set forth in Section 5.3.
"Institutional Trustee Account" has the meaning set forth in
Section 3.8(c).
"Investment Company" means an investment company as defined in
the Investment Company Act.
"Investment Company Act" means the Investment Company Act of
1940, as amended from time to time, or any successor legislation.
"Investment Company Event" has the meaning set forth in Annex
I hereto.
"Legal Action" has the meaning set forth in Section 3.6(g).
"Majority in liquidation amount of the Securities" means,
except as provided in the terms of the Preferred Securities or by the Trust
Indenture Act, Holder(s) of outstanding Securities voting together as a single
class or, as the context may require, Holders of outstanding Preferred
Securities or Holders of outstanding Common Securities voting separately as a
class, who are the record owners of more than 50% of the aggregate liquidation
amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accrued and unpaid Distributions to the date
upon which the voting percentages are determined) of all outstanding Securities
of the relevant class.
"Ministerial Action" has the meaning set forth in the terms of
the Securities as set forth in Annex I.
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<PAGE> 8
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Declaration shall include:
(a) a statement that each officer signing the
Certificate has read the covenant or condition and the definitions relating
thereto;
(b) a brief statement of the nature and scope of
the examination or investigation undertaken by each officer in rendering the
Certificate;
(c) a statement that each such officer has made
such examination or investigation as, in such officer's opinion, is necessary
to enable such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of
each such officer, such condition or covenant has been complied with.
"Paying Agent" has the meaning specified in Section 7.2.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Preferred Securities Guarantee" means the guarantee agreement
to be dated as of ______, 1998, of the Sponsor in respect of the Preferred
Securities.
"Preferred Security Beneficial Owner" means, with respect to a
Book Entry Interest, a Person who is the beneficial owner of such Book Entry
Interest, as reflected on the books of the Clearing Agency, or on the books of
a Person maintaining an account with such Clearing Agency (directly as a
Clearing Agency Participant or as an indirect participant, in each case in
accordance with the rules of such Clearing Agency).
"Preferred Security Certificate" means a certificate
representing a Preferred Security substantially in the form of Exhibit A-1.
"Pricing Agreement" means the pricing agreement between the
Trust, the Debenture Issuer, and the underwriters designated by the Regular
Trustees with respect to the offer and sale of the Preferred Securities.
"Quorum" means a majority of the Regular Trustees or, if there
are only two Regular Trustees, both of them.
"Regular Trustee" has the meaning set forth in Section 5.1..
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<PAGE> 9
"Related Party" means, with respect to the Sponsor, any direct
or indirect wholly owned subsidiary of the Sponsor or any other Person that
owns, directly or indirectly, 100% of the outstanding voting securities of the
Sponsor.
"Responsible Officer" means, with respect to the Institutional
Trustee, any officer within the Corporate Trust Office of the Institutional
Trustee, including any vice-president, any assistant vice-president, any
assistant secretary, the treasurer, any assistant treasurer or other officer of
the Corporate Trust Office of the Institutional Trustee customarily performing
functions similar to those performed by any of the above designated officers
and also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of that officer's knowledge of
and familiarity with the particular subject.
"Rule 3a-5" means Rule 3a-5 under the Investment Company Act.
"Securities" means the Common Securities and the Preferred
Securities.
"Securities Act" means the Securities Act of 1933, as amended
from time to time or any successor legislation.
"Special Event" has the meaning set forth in Annex I hereto.
"Securities Guarantees" means the Common Securities Guarantee
and the Preferred Securities Guarantee.
"Sponsor" means Phillips Petroleum Company, a Delaware
corporation, or any successor entity in a merger, consolidation or
amalgamation, in its capacity as sponsor of the Trust.
"Super Majority" has the meaning set forth in Section
2.6(a)(ii).
"Tax Event" has the meaning set forth in Annex I hereto.
"10% in liquidation amount of the Securities" means, except as
provided in the terms of the Preferred Securities or by the Trust Indenture
Act, Holder(s) of outstanding Securities voting together as a single class or,
as the context may require, Holders of outstanding Preferred Securities or
Holders of outstanding Common Securities voting separately as a class, who are
the record owners of 10% or more of the aggregate liquidation amount (including
the stated amount that would be paid on redemption, liquidation or otherwise,
plus accrued and unpaid Distributions to the date upon which the voting
percentages are determined) of all outstanding Securities of the relevant
class.
"Treasury Regulations" means the income tax regulations,
including temporary and proposed regulations, promulgated under the Code by the
United States Treasury, as such regulations may be amended from time to time
(including corresponding provisions of succeeding regulations).
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<PAGE> 10
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with
the provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended from time to time, or any successor legislation.
"Underwriting Agreement" means the Underwriting Agreement for
the offering and sale of Preferred Securities in the form of Exhibit C.
ARTICLE II
TRUST INDENTURE ACT
Section 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions
of the Trust Indenture Act that are required to be part of this Declaration and
shall, to the extent applicable, be governed by such provisions.
(b) The Institutional Trustee shall be the only
Trustee which is a Trustee for the purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of
this Declaration limits, qualifies or conflicts with the duties imposed by
Sections 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties
shall control.
(d) (d) The application of the Trust Indenture
Act to this Declaration shall not affect the nature of the Securities as equity
securities representing undivided beneficial interests in the assets of the
Trust.
Section 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Regular Trustees
on behalf of the Trust shall provide the Institutional Trustee (i) within 14
days after each record date for payment of Distributions, a list, in such form
as the Institutional Trustee may reasonably require, of the names and addresses
of the Holders of the Securities ("List of Holders") as of such record date,
provided that neither the Sponsor nor the Regular Trustees on behalf of the
Trust shall be obligated to provide such List of Holders at any time the List
of Holders does not differ from the most recent List of Holders given to the
Institutional Trustee by the Sponsor and the Regular Trustees on behalf of the
Trust, and (ii) at any other time, within 30 days of receipt by the Trust of a
written request for a List of Holders as of a date no more than 14 days before
such List of Holders is given to the Institutional Trustee. The Institutional
Trustee shall preserve, in as current a form as is reasonably practicable, all
information contained in Lists of Holders given to it or which it receives in
the capacity as Paying Agent (if acting in such capacity) provided that the
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<PAGE> 11
Institutional Trustee may destroy any List of Holders previously given to it on
receipt of a new List of Holders.
(b) The Institutional Trustee shall comply with
its obligations under Sections 311(a), 311(b) and 312(b) of the Trust
Indenture Act.
Section 2.3 Reports by the Institutional Trustee.
Within 60 days after May 1 of each year, the Institutional
Trustee shall provide to the Holders of the Preferred Securities such reports
as are required by Section 313 of the Trust Indenture Act, if any, in the form
and in the manner provided by Section 313 of the Trust Indenture Act. The
Institutional Trustee shall also comply with the requirements of Section
313(d) of the Trust Indenture Act.
Section 2.4 Periodic Reports to Institutional Trustee.
Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide to the Institutional Trustee such documents, reports and
information as required by Section 314 (if any) and the compliance certificate
required by Section 314 of the Trust Indenture Act in the form, in the manner
and at the times required by Section 314 of the Trust Indenture Act.
Section 2.5 Evidence of Compliance with Conditions
Precedent.
Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide to the Institutional Trustee such evidence of compliance
with any conditions precedent, if any, provided for in this Declaration that
relate to any of the matters set forth in Section 314(c) of the Trust
Indenture Act. Any certificate or opinion required to be given by an officer
pursuant to Section 314(c)(1) may be given in the form of an Officers'
Certificate.
Section 2.6 Events of Default; Waiver.
(a) The Holders of a Majority in liquidation
amount of Preferred Securities may, by vote, on behalf of the Holders of all of
the Preferred Securities, waive any past Event of Default in respect of the
Preferred Securities and its consequences, provided that, if the underlying
Event of Default under the Indenture:
(i) is not waivable under the Indenture, the
Event of Default under the Declaration shall also not be
waivable; or
(ii) requires the consent or vote of greater than
a majority in principal amount of the holders of the
Debentures (a "Super Majority") to be waived under the
Indenture, the Event of Default under the Declaration may only
be waived by the vote of the Holders of at least the
proportion in liquidation amount of the Preferred
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<PAGE> 12
Securities that the relevant Super Majority represents of the
aggregate principal amount of the Debentures outstanding.
The foregoing provisions of this Section 2.6(a) shall be in lieu of Section
316(a)(1)(B) of the Trust Indenture Act and such Section 316(a)(1)(B) of the
Trust Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act. Upon such waiver, any such
default shall cease to exist, and any Event of Default with respect to the
Preferred Securities arising therefrom shall be deemed to have been cured, for
every purpose of this Declaration, but no such waiver shall extend to any
subsequent or other default or an Event of Default with respect to the
Preferred Securities or impair any right consequent thereon. Any waiver by the
Holders of the Preferred Securities of an Event of Default with respect to the
Preferred Securities shall also be deemed to constitute a waiver by the Holders
of the Common Securities of any such Event of Default with respect to the
Common Securities for all purposes of this Declaration without any further act,
vote, or consent of the Holders of the Common Securities.
(b) The Holders of a Majority in liquidation
amount of the Common Securities may, by vote, on behalf of the Holders of all
of the Common Securities, waive any past Event of Default with respect to the
Common Securities and its consequences, provided that, if the underlying Event
of Default under the Indenture:
(i) is not waivable under the Indenture, except
where the Holders of the Common Securities are deemed to have
waived such Event of Default under the Declaration as provided
below in this Section 2.6(b), the Event of Default under the
Declaration shall also not be waivable; or
(ii) requires the consent or vote of a Super
Majority to be waived, except where the Holders of the Common
Securities are deemed to have waived such Event of Default
under the Declaration as provided below in this Section
2.6(b), the Event of Default under the Declaration may only be
waived by the vote of the Holders of at least the proportion
in liquidation amount of the Common Securities that the
relevant Super Majority represents of the aggregate principal
amount of the Debentures outstanding;
provided further, each Holder of Common Securities will be deemed to have
waived any such Event of Default and all Events of Default with respect to the
Common Securities and its consequences until all Events of Default with respect
to the Preferred Securities have been cured, waived or otherwise eliminated,
and until such Events of Default have been so cured, waived or otherwise
eliminated, the Institutional Trustee will be deemed to be acting solely on
behalf of the Holders of the Preferred Securities and only the Holders of the
Preferred Securities will have the right to direct the Institutional Trustee in
accordance with the terms of the Securities. The foregoing provisions of this
Section 2.6(b) shall be in lieu of Sections 316(a)(1)(A) and 316(a)(1)(B) of
the Trust Indenture Act and such Sections 316(a)(1)(A) and 316(a)(1)(B) of the
Trust Indenture Act
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<PAGE> 13
are hereby expressly excluded from this Declaration and the Securities, as
permitted by the Trust Indenture Act. Subject to the foregoing provisions of
this Section 2.6(b), upon such waiver, any such default shall cease to exist
and any Event of Default with respect to the Common Securities arising
therefrom shall be deemed to have been cured for every purpose of this
Declaration, but no such waiver shall extend to any subsequent or other default
or Event of Default with respect to the Common Securities or impair any right
consequent thereon.
(c) A waiver of an Event of Default under the
Indenture by the Institutional Trustee at the direction of the Holders of the
Preferred Securities, constitutes a waiver of the corresponding Event of
Default under this Declaration. The foregoing provisions of this Section 2.6(c)
shall be in lieu of Section 316(a)(1)(B) of the Trust Indenture Act and such
Section 316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded
from this Declaration and the Securities, as permitted by the Trust Indenture
Act.
Section 2.7 Event of Default; Notice.
(a) The Institutional Trustee shall, within 90
days after the occurrence of an Event of Default, transmit by mail, first class
postage prepaid, to the Holders of the Securities, notices of all defaults with
respect to the Securities actually known to a Responsible Officer of the
Institutional Trustee, unless such defaults have been cured before the giving
of notice (the term "defaults" for the purposes of this Section 2.7(a) being
hereby defined to be an Event of Default as defined in the Indenture, not
including any periods of grace provided for therein and irrespective of the
giving of any notice provided therein); provided that, except for a default in
the payment of principal of (or premium, if any) or interest on any of the
Debentures or in the payment of any sinking fund installment established for
the Debentures, the Institutional Trustee shall be protected in withholding
such notice if and so long as a Responsible Officer of the Institutional
Trustee in good faith determines that the withholding of such notice is in the
interests of the Holders of the Securities.
(b) The Institutional Trustee shall not be deemed
to have knowledge of any default except:
(i) a default under Sections ____ and ____ of the
Indenture; or
(ii) any default as to which the Institutional
Trustee shall have received written notice or of which a
Responsible Officer of the Institutional Trustee charged with
the administration of the Declaration shall have actual
knowledge.
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ARTICLE III
ORGANIZATION
Section 3.1 Name.
The Trust is named "Phillips 66 Capital VI," as such name may
be modified from time to time by the Regular Trustees following written notice
to the Holders of Securities. The Trust's activities may be conducted under the
name of the Trust or any other name deemed advisable by the Regular Trustees.
Section 3.2 Office.
The address of the principal office of the Trust is c/o
Phillips Petroleum Company, Phillips Building, Bartlesville, Oklahoma 74004. On
ten Business Days written notice to the Holders of Securities, the Regular
Trustees may designate another principal office.
Section 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to
issue and sell Securities and use the proceeds from such sale to acquire the
Debentures, and (b) except as otherwise limited herein, to engage in only those
other activities necessary, or incidental thereto. The Trust shall not borrow
money, issue debt or reinvest proceeds derived from investments, pledge any of
its assets, or otherwise undertake (or permit to be undertaken) any activity
that would cause the Trust not to be classified for United States federal
income tax purposes as a grantor trust.
Section 3.4 Authority.
Subject to the limitations provided in this Declaration and to
the specific duties of the Institutional Trustee, the Regular Trustees shall
have exclusive and complete authority to carry out the purposes of the Trust.
An action taken by the Regular Trustees in accordance with their powers shall
constitute the act of and serve to bind the Trust and an action taken by the
Institutional Trustee on behalf of the Trust in accordance with its powers
shall constitute the act of and serve to bind the Trust. In dealing with the
Trustees acting on behalf of the Trust, no person shall be required to inquire
into the authority of the Trustees to bind the Trust. Persons dealing with the
Trust are entitled to rely conclusively on the power and authority of the
Trustees as set forth in this Declaration.
Section 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the
Debentures and the Institutional Trustee Account or as otherwise provided in
this Declaration, legal title to all assets of the Trust shall be vested in the
Trust. The Holders shall not have legal title to any part of the assets of the
Trust, but shall have an undivided beneficial interest in the assets of the
Trust.
Section 3.6 Powers and Duties of the Regular Trustees.
The Regular Trustees shall have the exclusive power, duty and
authority to cause the Trust to engage in the following activities:
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<PAGE> 15
(a) to issue and sell the Preferred Securities
and the Common Securities in accordance with this Declaration; provided,
however, that the Trust may issue no more than one series of Preferred
Securities and no more than one series of Common Securities, and, provided
further, that there shall be no interests in the Trust other than the
Securities, and the issuance of Securities shall be limited to a simultaneous
issuance of both Preferred Securities and Common Securities on [each] Closing
Date;
(b) in connection with the issue and sale of the
Preferred Securities, at the direction of the Sponsor, to:
(i) execute and file with the Commission the
registration statement on Form S-3 prepared by the Sponsor,
including any amendments thereto, pertaining to the Preferred
Securities;
(ii) execute and file any documents prepared by
the Sponsor, or take any acts as determined by the Sponsor to
be necessary in order to qualify or register all or part of
the Preferred Securities in any State in which the Sponsor has
determined to qualify or register such Preferred Securities
for sale;
(iii) execute and file an application, prepared by
the Sponsor, to the New York Stock Exchange, Inc. or any other
national stock exchange or the Nasdaq Stock Market's National
Market for listing upon notice of issuance of any Preferred
Securities;
(iv) execute and file with the Commission a
registration statement on Form 8-A, including any amendments
thereto, prepared by the Sponsor, relating to the registration
of the Preferred Securities under Section 12(b) of the
Exchange Act; and
(v) execute and enter into the Underwriting
Agreement and Pricing Agreement providing for the sale of the
Preferred Securities;
(c) to acquire the Debentures with the proceeds
of the sale of the Preferred Securities and the Common Securities; provided,
however, that the Regular Trustees shall cause legal title to the Debentures to
be held of record in the name of the Institutional Trustee for the benefit of
the Holders of the Preferred Securities and the Holders of Common Securities;
(d) to give the Sponsor and the Institutional
Trustee prompt written notice of the occurrence of a Tax Event; provided that
the Regular Trustees shall consult with the Sponsor and the Institutional
Trustee before taking or refraining from taking any Ministerial Action in
relation to a Tax Event;
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<PAGE> 16
(e) to establish a record date with respect to
all actions to be taken hereunder that require a record date be established,
including and with respect to, for the purposes of Section 316(c) of the Trust
Indenture Act, Distributions, voting rights, redemptions and exchanges, and to
issue relevant notices to the Holders of Preferred Securities and Holders of
Common Securities as to such actions and applicable record dates;
(f) to take all actions and perform such duties
as may be required of the Regular Trustees pursuant to the terms of the
Securities;
(g) to bring or defend, pay, collect, compromise,
arbitrate, resort to legal action, or otherwise adjust claims or demands of or
against the Trust ("Legal Action"), unless pursuant to Section 3.8(e), the
Institutional Trustee has the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and
agents (who may be designated as officers with titles) and managers,
contractors, advisors, and consultants and pay reasonable compensation for such
services;
(i) to cause the Trust to comply with the Trust's
obligations under the Trust Indenture Act;
(j) to give the certificate required by Section
314(a)(4) of the Trust Indenture Act to the Institutional Trustee, which
certificate may be executed by any Regular Trustee;
(k) to incur expenses that are necessary or
inciden- tal to carry out any of the purposes of the Trust;
(l) to act as, or appoint another Person to act
as, registrar and transfer agent for the Securities;
(m) to give prompt written notice to the Holders
of the Securities of any notice received from the Debenture Issuer of its
election to defer payments of interest on the Debentures by extending the
interest payment period under the Indenture;
(n) to execute all documents or instruments,
perform all duties and powers, and do all things for and on behalf of the Trust
in all matters necessary or incidental to the foregoing;
(o) to take all action that may be necessary or
appropriate for the preservation and the continuation of the Trust's valid
existence, rights, franchises and privileges as a statutory business trust
under the laws of the State of Delaware and of each other jurisdiction in which
such existence is necessary to protect the limited liability of the Holders of
the Preferred Securities or to enable the Trust to effect the purposes for
which the Trust was created;
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(p) to take any action, not inconsistent with
this Declaration or with applicable law, that the Regular Trustees determine in
their discretion to be necessary or desirable in carrying out the activities of
the Trust as set out in this Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an
Investment Company required to be registered under the
Investment Company Act;
(ii) causing the Trust to be classified for United
States federal income tax purposes as a grantor trust; and
(iii) cooperating with the Debenture Issuer to
ensure that the Debentures will be treated as indebtedness of
the Debenture Issuer for United States federal income tax
purposes, provided that such action does not adversely affect
the interests of Holders; and
(q) to take all action necessary to cause all
applicable tax returns and tax information reports that are required to be
filed with respect to the Trust to be duly prepared and filed by the Regular
Trustees, on behalf of the Trust.
The Regular Trustees must exercise the powers set forth in
this Section 3.6 in a manner that is consistent with the purposes and functions
of the Trust set out in Section 3.3, and the Regular Trustees shall not take
any action that is inconsistent with the purposes and functions of the Trust
set forth in Section 3.3.
Subject to this Section 3.6, the Regular Trustees shall have
none of the powers or the authority of the Institutional Trustee set forth in
Section 3.8.
Any expenses incurred by the Regular Trustees pursuant to this
Section 3.6 shall be reimbursed by the Debenture Issuer.
Section 3.7 Prohibition of Actions by the Trust and the
Trustees.
(a) The Trust shall not, and the Trustees
(including the Institutional Trustee) shall not, engage in any activity other
than as required or authorized by this Declaration. In particular, the Trust
shall not and the Trustees (including the Institutional Trustee) shall cause
the Trust not to:
(i) invest any proceeds received by the Trust
from holding the Debentures, but shall distribute all such
proceeds to Holders of Securities pursuant to the terms of
this Declaration and of the Securities;
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(ii) acquire any assets other than as expressly
pro- vided herein;
(iii) possess Trust property for other than a Trust
purpose;
(iv) make any loans or incur any indebtedness
other than loans represented by the Debentures;
(v) possess any power or otherwise act in such a
way as to vary the Trust assets or the terms of the Securities
in any way whatsoever;
(vi) issue any securities or other evidences of
beneficial ownership of, or beneficial interest in, the Trust
other than the Securities; or
(vii) other than as provided in this Amended and
Restated Declaration or Annex I, (A) direct the time, method
and place of exercising any trust or power conferred upon the
Debenture Trustee with respect to the Debentures, (B) waive
any past default that is waivable under the Indenture, (C)
exercise any right to rescind or annul any declaration that
the principal of all the Debentures shall be due and payable,
or (D) consent to any amendment, modification or termination
of the Indenture or the Debentures where such consent shall be
required unless the Trust shall have received an opinion of
counsel to the effect that such modification will not cause
more than an insubstantial risk that for United States federal
income tax purposes the Trust will not be classified as a
grantor trust.
Section 3.8 Powers and Duties of the Institutional
Trustee.
(a) The legal title to the Debentures shall be
owned by and held of record in the name of the Institutional Trustee in trust
for the benefit of the Holders of the Securities. The right, title and interest
of the Institutional Trustee to the Debentures shall vest automatically in each
Person who may hereafter be appointed as Institutional Trustee in accordance
with Section 5.7. Such vesting and cessation of title shall be effective
whether or not conveyancing documents with regard to the Debentures have been
executed and delivered.
(b) The Institutional Trustee shall not transfer
its right, title and interest in the Debentures to the Regular Trustees or to
the Delaware Trustee (if the Institutional Trustee does not also act as
Delaware Trustee).
(c) The Institutional Trustee shall:
(i) establish and maintain a segregated
non-interest bearing trust account (the "Institutional Trustee
Account") in the
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name of and under the exclusive control of the Institutional
Trustee on behalf of the Holders of the Securities and, upon
the receipt of payments of funds made in respect of the
Debentures held by the Institutional Trustee, deposit such
funds into the Institutional Trustee Account and make payments
to the Holders of the Preferred Securities and Holders of the
Common Securities from the Institutional Trustee Account in
accordance with Section 6.1. Funds in the Institutional
Trustee Account shall be held uninvested until disbursed in
accordance with this Declaration. The Institutional Trustee
Account shall be an account that is maintained with a banking
institution the rating on whose long-term unsecured
indebtedness is at least equal to the rating assigned to the
Preferred Securities by a "nationally recognized statistical
rating organization", as that term is defined for purposes of
Rule 436(g)(2) under the Securities Act;
(ii) engage in such ministerial activities as
shall be necessary or appropriate to effect the redemption of
the Preferred Securities and the Common Securities to the
extent the Debentures are redeemed or mature; and
(iii) upon written notice of distribution issued by
the Regular Trustees in accordance with the terms of the
Securities, engage in such ministerial activities as shall be
necessary or appropriate to effect the distribution of the
Debentures to Holders of Securities upon the occurrence of
certain special events (as may be defined in the terms of the
Securities) arising from a change in law or a change in legal
interpretation or other specified circumstances pursuant to
the terms of the Securities.
(d) The Institutional Trustee shall take all
actions and perform such duties as may be specifically required of the
Institutional Trustee pursuant to the terms of the Securities.
(e) The Institutional Trustee shall take any
Legal Action which arises out of or in connection with an Event of Default of
which a Responsible Officer of the Institutional Trustee has actual knowledge
or the Institutional Trustee's duties and obligations under this Declaration or
the Trust Indenture Act; provided however, that if a Declaration Event of
Default has occurred and is continuing and such event is attributable to the
failure of the Debenture Issuer to pay interest or principal on the Debentures
on the date such interest or principal is otherwise payable (or in the case of
redemption, on the redemption date), then a Holder of Preferred Securities may
directly institute a proceeding for enforcement of payment to such Holder of
the principal of or interest on the Debentures having a principal amount equal
to the aggregate liquidation amount of the Preferred Securities of such Holder
(a "Direct Action") on or after the respective due date specified in the
Debentures. In connection with such Direct
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<PAGE> 20
Action, the rights of the Holders of the Common Securities Holder will be
subrogated to the rights of such Holder of Preferred Securities to the extent
of any payment made by the Issuer to such Holder of Preferred Securities in
such Direct Action. Except as provided in the preceding sentences, the Holders
of Preferred Securities will not be able to exercise directly any other remedy
available to the holders of the Debentures.
(f) The Institutional Trustee shall not resign as
a Trustee unless either:
(i) the Trust has been completely liquidated and
the proceeds of the liquidation distributed to the Holders of
Securities pursuant to the terms of the Securities; or
(ii) a Successor Institutional Trustee has been
appointed and has accepted that appointment in accordance with
Section 5.7.
(g) The Institutional Trustee shall have the
legal power to exercise all of the rights, powers and privileges of a holder of
Debentures under the Indenture and, if an Event of Default actually known to a
Responsible Officer of the Institutional Trustee occurs and is continuing, the
Institutional Trustee shall, for the benefit of Holders of the Securities,
enforce its rights as holder of the Debentures subject to the rights of the
Holders pursuant to the terms of such Securities.
(h) The Institutional Trustee may authorize one
or more Persons (each, a "Paying Agent") to pay Distributions, redemption
payments or liquidation payments on behalf of the Trust with respect to all
securities and any such Paying Agent shall comply with Section 317(b) of the
Trust Indenture Act. Any Paying Agent may be removed by the Institutional
Trustee at any time and a successor Paying Agent or additional Paying Agents
may be appointed at any time by the Institutional Trustee.
(i) Subject to this Section 3.8, the
Institutional Trustee shall have none of the duties, liabilities, powers or the
authority of the Regular Trustees set forth in Section 3.6.
The Institutional Trustee must exercise the powers set forth
in this Section 3.8 in a manner that is consistent with the purposes and
functions of the Trust set out in Section 3.3, and the Institutional Trustee
shall not take any action that is inconsistent with the purposes and functions
of the Trust set out in Section 3.3.
Section 3.9 Certain Duties and Responsibilities of the
Institutional Trustee.
(a) The Institutional Trustee, before the
occurrence of any Event of Default and after the curing of all Events of
Default that may have occurred, shall undertake to perform only such duties as
are specifically set forth in this Declaration and no implied covenants shall
be read into this Declaration against the Institutional Trustee. In case an
Event of Default has occurred (that has not been cured or waived pursuant to
Section 2.6) of which a Responsible Officer of the Institutional Trustee has
actual knowledge, the Institutional Trustee
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<PAGE> 21
shall exercise such of the rights and powers vested in it by this Declaration,
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 or
her own affairs.
(b) No provision of this Declaration shall be
construed to relieve the Institutional Trustee from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) prior to the occurrence of an Event of
Default and after the curing or waiving of all such Events of
De- fault that may have occurred:
(A) the duties and obligations of the Institutional
Trustee shall be determined solely by the express provisions of this
Declaration and the Institutional Trustee shall not be liable except for the
performance of such duties and obligations as are specifically set forth in
this Declaration, and no implied covenants or obligations shall be read into
this Declaration against the Institutional Trustee; and
(B) in the absence of bad faith on the part of the
Institutional Trustee, the Institutional Trustee may conclusively rely, as
to the truth of the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the Institutional
Trustee and conforming to the requirements of this Declaration; but in the
case of any such certificates or opinions that by any provision hereof are
specifically required to be furnished to the Institutional Trustee, the
Institutional Trustee shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this Declaration;
(ii) the Institutional Trustee shall not be liable
for any error of judgment made in good faith by a Responsi-
ble Officer of the Institutional Trustee, unless it shall be
proved that the Institutional Trustee was negligent in
ascertaining the pertinent facts;
(iii) the Institutional Trustee shall not be liable
with respect to any action taken or omitted to be taken by it
in good faith in accordance with the direction of the Holders
of not less than a Majority in liquidation amount of the
Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the
Institutional Trustee, or exercising any trust or power
conferred upon the Institutional Trustee under this
Declaration;
(iv) no provision of this Declaration shall
require the Institutional Trustee to expend or risk its own
funds or otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of
its rights or powers, if it shall have reasonable grounds for
believing that the repayment of such funds or
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<PAGE> 22
liability is not reasonably assured to it under the terms of
this Declaration or indemnity reasonably satisfactory to the
Institutional Trustee against such risk or liability is not
reasonably assured to it;
(v) the Institutional Trustee's sole duty with
respect to the custody, safe keeping and physical preservation
of the Debentures and the Institutional Trustee Account shall
be to deal with such property in a similar manner as the
Institutional Trustee deals with similar property for its own
account, subject to the protections and limitations on
liability afforded to the Institutional Trustee under this
Declaration and the Trust Indenture Act;
(vi) the Institutional Trustee shall have no duty
or liability for or with respect to the value, genuineness,
existence or sufficiency of the Debentures or the payment of
any taxes or assessments levied thereon or in connection
therewith;
(vii) the Institutional Trustee shall not be liable
for any interest on any money received by it except as it may
otherwise agree with the Sponsor. Money held by the
Institutional Trustee need not be segregated from other funds
held by it except in relation to the Institutional Trustee
Account maintained by the Institutional Trustee pursuant to
Section 3.8(c)(i) and except to the extent otherwise required
by law; and
(viii) the Institutional Trustee shall not be
responsible for monitoring the compliance by the Regular
Trustees or the Sponsor with their respective duties under
this Declaration, nor shall the Institutional Trustee be
liable for default or misconduct of the Regular Trustees or
the Sponsor.
Section 3.10 Certain Rights of Institutional Trustee.
(a) Subject to the provisions of Section 3.9:
(i) the Institutional Trustee may conclusively
rely and shall be fully protected in acting or refraining from
acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be
genuine and to have been signed, sent or presented by the
proper party or parties;
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<PAGE> 23
(ii) any direction or act of the Sponsor or the
Regular Trustees contemplated by this Declaration shall be
sufficiently evidenced by a Direction or an Officers'
Certificate;
(iii) whenever in the administration of this
Declaration, the Institutional Trustee shall deem it
desirable that a matter be proved or established before
taking, suffering or omitting any action hereunder, the
Institutional Trustee (unless other evidence is herein
specifically prescribed) may, in the absence of bad faith on
its part, request and conclusively rely upon an Officers'
Certificate which, upon receipt of such request, shall be
promptly delivered by the Sponsor or the Regular Trustees;
(iv) the Institutional Trustee shall have no duty
to see to any recording, filing or registration of any
instrument (including any financing or continuation statement
or any filing under tax or securities laws) or any
rerecording, refiling or registration thereof;
(v) the Institutional Trustee may consult with
counsel or other experts and the advice or opinion of such
counsel and experts with respect to legal matters or advice
within the scope of such experts' area of expertise shall be
full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder in good
faith and in accordance with such advice or opinion, such
counsel may be counsel to the Sponsor or any of its
Affiliates, and may include any of its employees. The
Institutional Trustee shall have the right at any time to seek
instructions concerning the administration of this Declaration
from any court of competent jurisdiction;
(vi) the Institutional Trustee shall be under no
obligation to exercise any of the rights or powers vested init
by this Declaration at the request or direction of any Holder,
unless such Holder shall have provided to the Institutional
Trustee security and indemnity, reasonably satisfactory to the
Institutional Trustee, against the costs, expenses (including
attorneys' fees and expenses and the expenses of the
Institutional Trustee's agents, nominees or custodians) and
liabilities that might be incurred by it in complying with
such request or direction, including such reasonable advances
as may be requested by the Institutional Trustee provided,
that, nothing contained in this Section 3.10(a)(vi) shall be
taken to relieve the Institutional Trustee, upon the
occurrence of an Event of Default, of its obligation to
exercise the rights and powers vested in it by this
Declaration;
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<PAGE> 24
(vii) the Institutional Trustee shall not be bound
to make any investigation into the facts or matters stated in
any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper
or document, but the Institutional Trustee, in its discretion,
may make such further inquiry or investigation into such facts
or matters as it may see fit;
(viii) the Institutional Trustee may execute any of
the trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents, custodians, nominees
or attorneys and the Institutional Trustee shall not be
responsible for any misconduct or negligence on the part of
any agent or attorney appointed with due care by it hereunder;
(ix) any action taken by the Institutional Trustee
or its agents hereunder shall bind the Trust and the Holders
of the Securities, and the signature of the Institutional
Trustee or its agents alone shall be sufficient and effective
to perform any such action and no third party shall be
required to inquire as to the authority of the Institutional
Trustee to so act or as to its compliance with any of the
terms and provisions of this Declaration, both of which shall
be conclusively evidenced by the Institutional Trustee's or
its agent's taking such action;
(x) whenever in the administration of this
Declaration the Institutional Trustee shall deem it desirable
to receive instructions with respect to enforcing any remedy
or right or taking any other action hereunder, the
Institutional Trustee (i) may request instructions from the
Holders of the Securities which instructions may only be given
by the Holders of the same proportion in liquidation amount of
the Securities as would be entitled to direct the
Institutional Trustee under the terms of the Securities in
respect of such remedy, right or action, (ii) may refrain from
enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be
protected in conclusively relying on or acting in or
accordance with such instructions; and
(xi) except as otherwise expressly provided by
this Declaration, the Institutional Trustee shall not be under
any obligation to take any action that is discretionary under
the provisions of this Declaration.
(b) No provision of this Declaration shall be
deemed to impose any duty or obligation on the Institutional Trustee to perform
any act or acts or exercise any right,
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power, duty or obligation conferred or imposed on it, in any jurisdiction in
which it shall be illegal, or in which the Institutional Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Institutional Trustee shall be
construed to be a duty.
Section 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration other
than Section 5.2, the Delaware Trustee shall not be entitled to exercise any
powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of the Regular Trustees or the Institutional Trustee described
in this Declaration. Except as set forth in Section 5.2, the Delaware Trustee
shall be a Trustee for the sole and limited purpose of fulfilling the
requirements of Section 3807 of the Business Trust Act.
Section 3.12 Execution of Documents.
Unless otherwise determined by the Regular Trustees, and
except as otherwise required by the Business Trust Act, a majority of or, if
there are only two, any Regular Trustee or, if there is only one, such Regular
Trustee is authorized to execute on behalf of the Trust any documents that the
Regular Trustees have the power and authority to execute pursuant to Section
3.6; provided that, the registration statement referred to in Section
3.6(b)(i), including any amendments thereto, shall be signed by all of the
Regular Trustees.
Section 3.13 Not Responsible for Recitals or Issuance of
Securities.
The recitals contained in this Declaration and the Securities
shall be taken as the statements of the Sponsor, and the Trustees do not assume
any responsibility for their correctness. The Trustees make no representations
as to the value or condition of the property of the Trust or any part thereof.
The Trustees make no representations as to the validity or sufficiency of this
Declaration or the Securities.
Section 3.14 Duration of Trust.
The Trust, unless terminated pursuant to the provisions of
Article VIII hereof, shall have existence for fifty-five (55) years from the
Closing Date.
Section 3.15 Mergers.
(a) The Trust may not consolidate, amalgamate,
merge with or into, or be replaced by, or convey, transfer or lease its
properties and assets substantially as an entirety to any corporation or other
body, except as described in Section 3.15(b) and (c).
(b) The Trust may, with the consent of the
Regular Trustees or, if there are more than two, a majority of the Regular
Trustees and without the consent of the Holders of
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the Securities, the Delaware Trustee or the Institutional Trustee, consolidate,
amalgamate, merge with or into, or be replaced by a trust organized as such
under the laws of any State; provided that:
(i) such successor entity (the "Successor
Entity") either:
(A) expressly assumes all of the obligations of the Trust
under the Securities; or
(B) substitutes for the Securities other securities
having substantially the same terms as the Preferred Securities (the
"Successor Securities") so long as the Successor Securities rank the same as
the Preferred Securities rank with respect to Distributions and payments
upon liquidation, redemption and otherwise;
(ii) the Debenture Issuer expressly acknowledges a
trustee of the Successor Entity that possesses the same powers
and duties as the Institutional Trustee as the Holder of the
Debentures;
(iii) the Preferred Securities or any Successor
Securities are listed, or any Successor Securities will be
listed upon notification of issuance, on any national
securities exchange or with another organization on which the
Preferred Securities are then listed or quoted;
(iv) such merger, consolidation, amalgamation or
replacement does not cause the Preferred Securities (including
any Successor Securities) to be downgraded by any nationally
recognized statistical rating organization;
(v) such merger, consolidation, amalgamation or
replacement does not adversely affect the rights, preferences
and privileges of the Holders of the Securities (including any
Successor Securities) in any material respect (other than with
respect to any dilution of such Holders' interests in the
Preferred Securities as a result of such merger,
consolidation, amalgamation or replacement);
(vi) such Successor Entity has a purpose identical
to that of the Trust;
(vii) prior to such merger, consolidation,
amalgamation or replacement, the Sponsor has received an
opinion of a nationally recognized independent counsel to the
Trust experienced in such matters to the effect that:
(A) such merger, consolidation, amalgamation or
replacement does not adversely affect the rights, preferences and privileges
of the Holders of the Securities
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(including any Successor Securities) in any material respect (other than
with respect to any dilution of the Holders' interest in the new entity);
and
(B) following such merger, consolidation, amalgamation or
replacement, neither the Trust nor the Successor Entity will be required to
register as an Investment Company;
(C) following such merger, consolidation, amalgamation or
replacement, the Trust (or the Successor Entity) will continue to be
classified as a grantor trust for United States federal income tax purposes;
and
(viii) the Sponsor guarantees the obligations of
such Successor Entity under the Successor Securities at least
to the extent provided by the Preferred Securities Guarantees.
(c) Notwithstanding Section 3.15(b), the Trust
shall not, except with the consent of Holders of 100% in liquidation amount of
the Securities, consolidate, amalgamate, merge with or into, or be replaced by
any other entity or permit any other entity to consolidate, amalgamate, merge
with or into, or replace it if such consolidation, amalgamation, merger or
replacement would cause the Trust or Successor Entity to be classified as other
than a grantor trust for United States federal income tax purposes.
ARTICLE IV
SPONSOR
Section 4.1 Sponsor's Purchase of Common Securities.
On the Closing Date the Sponsor will purchase all of the
Common Securities issued by the Trust, in an amount at least equal to 3% of the
capital of the Trust, at the same time as the Preferred Securities are sold.
Section 4.2 Responsibilities of the Sponsor.
In connection with the issue and sale of the Preferred
Securities, the Sponsor shall have the exclusive right and responsibility to
engage in the following activities:
(a) to prepare for filing by the Trust with the
Com- mission a registration statement on Form S-3 in relation to the Preferred
Securities, including any amendments thereto;
(b) to determine the States in which to take
appropriate action to qualify or register for sale all or part of the Preferred
Securities and to do any and all such acts, other than actions which must be
taken by the Trust, and advise the Trust of actions it must take, and prepare
for execution and filing any documents to be executed and filed by the Trust,
as the
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Sponsor deems necessary or advisable in order to comply with the applicable
laws of any such States;
(c) to prepare for filing by the Trust an
application to the New York Stock Exchange or any other national stock exchange
or the Nasdaq National Market for listing upon notice of issuance of any
Preferred Securities;
(d) to prepare for filing by the Trust with the
Commission a registration statement on Form 8-A relating to the registration of
the Preferred Securities under Section 12(b) of the Exchange Act, including any
amendments thereto; and
(e) to negotiate the terms of the Underwriting
Agreement and Pricing Agreement providing for the sale of the Preferred
Securities.
ARTICLE V
TRUSTEES
Section 5.1 Number of Trustees.
The number of Trustees initially shall be [four (4)], and:
(a) at any time before the issuance of any
Securities, the Sponsor may, by written instrument, increase or decrease the
number of Trustees; and
(b) after the issuance of any Securities, the
number of Trustees may be increased or decreased by vote of the Holders of a
majority in liquidation amount of the Common Securities voting as a class at a
meeting of the Holders of the Common Securities; provided, however, that, the
number of Trustees shall in no event be less than two (2); provided further
that (1) one Trustee, in the case of a natural person, shall be a person who is
a resident of the State of Delaware or that, if not a natural person, is an
entity which has its principal place of business in the State of Delaware (the
"Delaware Trustee"); (2) there shall be at least one Trustee who is an employee
or officer of, or is affiliated with the Parent (a "Regular Trustee"); and (3)
one Trustee shall be the Institutional Trustee for so long as this Declaration
is required to qualify as an indenture under the Trust Indenture Act, and such
Trustee may also serve as Delaware Trustee if it meets the applicable
requirements.
Section 5.2 Delaware Trustee.
If required by the Business Trust Act, one Trustee (the
"Delaware Trustee") shall be:
(a) a natural person who is a resident of the
State of Delaware; or
(b) if not a natural person, an entity which has
its principal place of business in the State of Delaware, and otherwise meets
the requirements of applicable law,
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provided that, if the Institutional Trustee has its principal place of business
in the State of Delaware and otherwise meets the requirements of applicable
law, then the Institutional Trustee shall also be the Delaware Trustee and
Section 3.11 shall have no application.
Section 5.3 Institutional Trustee; Eligibility.
(a) There shall at all times be one Trustee which
shall act as Institutional Trustee which shall:
(i) not be an Affiliate of the Sponsor; and
(ii) be a corporation organized and doing business
under the laws of the United States of America or any State or
Territory thereof or of the District of Columbia, or a
corporation or Person permitted by the Commission to act as an
institutional trustee under the Trust Indenture Act,
authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least 50 million
U.S. dollars ($50,000,000), and subject to supervision or
examination by Federal, State, Territorial or District of
Columbia authority. If such corporation publishes reports of
condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority
referred to above, then for the purposes of this Section
5.3(a)(ii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so
published.
(b) If at any time the Institutional Trustee
shall cease to be eligible to so act under Section 5.3(a), the Institutional
Trustee shall immediately resign in the manner and with the effect set forth in
Section 5.7(c).
(c) If the Institutional Trustee has or shall
acquire any "conflicting interest" within the meaning of Section 310(b) of the
Trust Indenture Act, the Institutional Trustee and the Holder of the Common
Securities (as if it were the obligor referred to in Section 310(b) of the
Trust Indenture Act) shall in all respects comply with the provisions of
Section 310(b) of the Trust Indenture Act.
(d) The Preferred Securities Guarantee shall be
deemed to be specifically described in this Declaration for purposes of clause
(i) of the first provision contained in Section 310(b) of the Trust Indenture
Act.
(e) The initial Institutional Trustee shall be:
The Bank of New York
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Section 5.4 Certain Qualifications of Regular Trustees
and Delaware Trustee Generally.
Each Regular Trustee and the Delaware Trustee (unless the
Institutional Trustee also acts as Delaware Trustee) shall be either a natural
person who is at least 21 years of age or a legal entity that shall act through
one or more Authorized Officers.
Section 5.5 Regular Trustees.
The initial Regular Trustees shall be:
T.C. Morris
J.A. Carrig
R.B. Gisi
(a) Except as expressly set forth in this
Declaration and except if a meeting of the Regular Trustees is called with
respect to any matter over which the Regular Trustees have power to act, any
power of the Regular Trustees may be exercised by, or with the consent of, any
one such Regular Trustee.
(b) Unless otherwise determined by the Regular
Trustees, and except as otherwise required by the Business Trust Act or
applicable law, any Regular Trustee is authorized to execute on behalf of the
Trust any documents which the Regular Trustees have the power and authority to
cause the Trust to execute pursuant to Section 3.6, provided, that, the
registration statement referred to in Section 3.6, including any amendments
thereto, shall be signed by all of the Regular Trustees; and
(c) a Regular Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purposes of signing any documents which the
Regular Trustees have power and authority to cause the Trust to execute
pursuant to Section 3.6.
Section 5.6 Delaware Trustee.
The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
Section 5.7 Appointment, Removal and Resignation of
Trustees.
(a) Subject to Section 5.7(b), Trustees may be
ap- pointed or removed without cause at any time:
(i) until the issuance of any Securities, by
written instrument executed by the Sponsor; and
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(ii) after the issuance of any Securities, by vote
of the Holders of a Majority in liquidation amount of the
Common Securities voting as a class at a meeting of the
Holders of the Common Securities.
(b)
(i) The Trustee that acts as Institutional
Trustee shall not be removed in accordance with Section 5.7(a)
until a Successor Institutional Trustee has been appointed and
has accepted such appointment by written instrument executed
by such Successor Institutional Trustee and delivered to the
Regular Trustees and the Sponsor; and
(ii) the Trustee that acts as Delaware Trustee
shall not be removed in accordance with this Section 5.7(a)
until a successor Trustee possessing the qualifications to act
as Delaware Trustee under Sections 5.2 and 5.4 (a "Successor
Delaware Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor
Delaware Trustee and delivered to the Regular Trustees and the
Sponsor.
(c) A Trustee appointed to office shall hold
office until his successor shall have been appointed or until his death,
removal or resignation. Any Trustee may resign from office (without need for
prior or subsequent accounting) by an instrument in writing signed by the
Trustee and delivered to the Sponsor and the Trust, which resignation shall
take effect upon such delivery or upon such later date as is specified therein;
provided, however, that:
(i) No such resignation of the Trustee that acts
as the Institutional Trustee shall be effective:
(A) until a Successor Institutional Trustee has been
appointed and has accepted such appointment by instrument executed by such
Successor Institutional Trustee and delivered to the Trust, the Sponsor and
the resigning Institutional Trustee; or
(B) until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the holders of the
Securities; and
(ii) no such resignation of the Trustee that acts
as the Delaware Trustee shall be effective until a Successor
Delaware Trustee has been appointed and has accepted such
appointment by instrument executed by such Successor Delaware
Trustee and delivered to the Trust, the Sponsor and the
resigning Delaware Trustee.
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(d) The Holders of the Common Securities shall
use their best efforts to promptly appoint a Successor Delaware Trustee or
Successor Institutional Trustee as the case may be if the Institutional Trustee
or the Delaware Trustee delivers an instrument of resignation in accordance
with this Section 5.7.
(e) If no Successor Institutional Trustee or
Successor Delaware Trustee shall have been appointed and accepted appointment
as provided in this Section 5.7 within 60 days after delivery to the Sponsor
and the Trust of an instrument of resignation, the resigning Institutional
Trustee or Delaware Trustee, as applicable, may petition any court of competent
jurisdiction for appointment of a Successor Institutional Trustee or Successor
Delaware Trustee. Such court may thereupon, after prescribing such notice, if
any, as it may deem proper and prescribe, appoint a Successor Institutional
Trustee or Successor Delaware Trustee, as the case may be.
(f) No Institutional Trustee or Delaware Trustee
shall be liable for the acts or omissions to act of any Successor Institutional
Trustee or successor Delaware Trustee, as the case may be.
Section 5.8 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the
number of Trustees is not reduced pursuant to Section 5.1, or if the number of
Trustees is increased pursuant to Section 5.1, a vacancy shall occur. A
resolution certifying the existence of such vacancy by the Regular Trustees or,
if there are more than two, a majority of the Regular Trustees shall be
conclusive evidence of the existence of such vacancy. The vacancy shall be
filled with a Trustee appointed in accordance with Section 5.7.
Section 5.9 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of a
Trustee shall not operate to annul the Trust. Whenever a vacancy in the number
of Regular Trustees shall occur, until such vacancy is filled by the
appointment of a Regular Trustee in accordance with Section 5.7, the Regular
Trustees in office, regardless of their number, shall have all the powers
granted to the Regular Trustees and shall discharge all the duties imposed upon
the Regular Trustees by this Declaration.
Section 5.10 Meetings.
If there is more than one Regular Trustee, meetings of the
Regular Trustees shall be held from time to time upon the call of any Regular
Trustee. Regular meetings of the Regular Trustees may be held at a time and
place fixed by resolution of the Regular Trustees. Notice of any in-person
meetings of the Regular Trustees shall be hand delivered or otherwise delivered
in writing (including by facsimile, with a hard copy by overnight courier) not
less than 48 hours before such meeting. Notice of any telephonic meetings of
the Regular Trustees or any
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committee thereof shall be hand delivered or otherwise delivered in writing
(including by facsimile, with a hard copy by overnight courier) not less than
24 hours before a meeting. Notices shall contain a brief statement of the time,
place and anticipated purposes of the meeting. The presence (whether in person
or by telephone) of a Regular Trustee at a meeting shall constitute a waiver of
notice of such meeting except where a Regular Trustee attends a meeting for the
express purpose of objecting to the transaction of any activity on the ground
that the meeting has not been lawfully called or convened. Unless provided
otherwise in this Declaration, any action of the Regular Trustees may be taken
at a meeting by vote of a majority of the Regular Trustees present (whether in
person or by telephone) and eligible to vote with respect to such matter,
provided that a Quorum is present, or without a meeting by the unanimous
written consent of the Regular Trustees. In the event there is only one Regular
Trustee, any and all action of such Regular Trustee shall be evidenced by a
written consent of such Regular Trustee.
Section 5.11 Delegation of Power.
(a) Any Regular Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purpose of executing any documents
contemplated in Section 3.6, including any registration statement or amendment
thereto filed with the Commission, or making any other governmental filing; and
(b) the Regular Trustees shall have power to
delegate from time to time to such of their number or to officers of the Trust
the doing of such things and the execution of such instruments either in the
name of the Trust or the names of the Regular Trustees or otherwise as the
Regular Trustees may deem expedient, to the extent such delegation is not
prohibited by applicable law or contrary to the provisions of the Trust, as set
forth herein.
Section 5.12 Merger, Conversion, Consolidation or
Succession to Business.
Any corporation into which the Institutional Trustee or the
Delaware Trustee, as the case may be, may be merged or converted or with which
either may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Institutional Trustee or the Delaware
Trustee, as the case may be, shall be a party, or any corporation succeeding to
all or substantially all the corporate trust business of the Institutional
Trustee or the Delaware Trustee, as the case may be, shall be the successor of
the Institutional Trustee or the Delaware Trustee, as the case may be,
hereunder, provided such corporation shall be otherwise qualified and eligible
under this Article, without the execution or filing of any paper or any further
act on the part of any of the parties hereto.
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ARTICLE VI
DISTRIBUTIONS
Section 6.1 Distributions.
Holders shall receive Distributions (as defined herein) in
accordance with the applicable terms of the relevant Holder's Securities.
Distributions shall be made on the Preferred Securities and the Common
Securities in accordance with the preferences set forth in their respective
terms. If and to the extent that the Debenture Issuer makes a payment of
interest (including Compounded Interest (as defined in the Indenture) and
Additional Interest (as defined in the Indenture)), premium and/or principal on
the Debentures held by the Institutional Trustee (the amount of any such
payment being a "Payment Amount"), the Institutional Trustee shall and is
directed, to the extent funds are available for that purpose, to make a
distribution (a "Distribution") of the Payment Amount to Holders.
ARTICLE VII
ISSUANCE OF SECURITIES
Section 7.1 General Provisions Regarding Securities.
(a) The Regular Trustees shall on behalf of the
Trust issue one class of preferred securities representing undivided beneficial
interests in the assets of the Trust having such terms as are set forth in
Annex I (the "Preferred Securities") and one class of common securities
representing undivided beneficial interests in the assets of the Trust having
such terms as are set forth in Annex I (the "Common Securities.") The Trust
shall issue no securities or other interests in the assets of the Trust other
than the Preferred Securities and the Common Securities.
(b) The Certificates shall be signed on behalf of
the Trust by a Regular Trustee. Such signature shall be the manual signature of
any present or any future Regular Trustee. In case any Regular Trustee of the
Trust who shall have signed any of the Securities shall cease to be such
Regular Trustee before the Certificates so signed shall be delivered by the
Trust, such Certificates nevertheless may be delivered as though the person who
signed such Certificates had not ceased to be such Regular Trustee; and any
Certificate may be signed on behalf of the Trust by such persons who, at the
actual date of execution of such Security, shall be the Regular Trustees of the
Trust, although at the date of the execution and delivery of the Declaration
any such person was not such a Regular Trustee. Certificates shall be printed,
lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Regular Trustees, as evidenced by their execution
thereof, and may have such letters, numbers or other marks of identification or
designation and such legends or endorsements as the Regular Trustees may deem
appropriate, or as may be required to comply with any law or with any rule or
regulation of any stock exchange on which Securities may be listed, or to
conform to usage.
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(c) The consideration received by the Trust for
the issuance of the Securities shall constitute a contribution to the capital
of the Trust and shall not constitute a loan to the Trust.
(d) Upon issuance of the Securities as provided
in this Declaration, the Securities so issued shall be deemed to be validly
issued, fully paid and non-assessable.
(e) Every Person, by virtue of having become a
Holder or a Preferred Security Beneficial Owner in accordance with the terms of
this Declaration, shall be deemed to have expressly assented and agreed to the
terms of, and shall be bound by, this Declaration.
Section 7.2 Paying Agent.
In the event that the Preferred Securities are not in
book-entry only form, the Trust shall maintain in the Borough of Manhattan,
City of New York, State of New York, an office or agency where the Preferred
Securities may be presented for payment ("Paying Agent). The Trust may appoint
the Paying Agent and may appoint one or more additional paying agents in such
other locations as it shall determine. The term "Paying Agent" includes any
additional paying agent. The Trust may change any Paying Agent without prior
notice to any Holder. The Trust shall notify the Institutional Trustee of the
name and address of any Agent not a party to this Declaration. If the Trust
fails to appoint or maintain another entity as Paying Agent, the Institutional
Trustee shall act as such. The Trust or any of its Affiliates may act as Paying
Agent. The Trust shall initially act as Paying Agent for the Preferred
Securities and the Common Securities.
ARTICLE VIII
TERMINATION OF TRUST
Section 8.1 Termination of Trust.
(a) The Trust shall terminate:
(i) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a certificate of
dissolution or its equivalent with respect to the Sponsor; the
filing of a certificate of cancellation with respect to the
Trust after having obtained the consent of a majority in
liquidation amount of the Securities voting together as a
single class to file such certificate of cancellation or the
revocation of the Sponsor's charter and the expiration of 90
days after the date of revocation without a reinstatement
thereof;
(iii) upon the entry of a decree of judicial
dissolu- tion of the Holder of the Common Securities, the
Sponsor or the Trust;
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(iv) when all of the Securities shall have been
called for redemption and the amounts necessary for redemption
thereof shall have been paid to the Holders in accordance with
the terms of the Securities;
(v) upon the occurrence and continuation of a
Special Event pursuant to which the Trust shall have been
dissolved in accordance with the terms of the Securities and
all of the Debentures endorsed thereon shall have been
distributed to the Holders of Securities in exchange for all
of the Securities; or
(vi) before the issuance of any Securities, with
the consent of all of the Regular Trustees and the Sponsor.
(b) As soon as is practicable after the
occurrence of an event referred to in Section 8.1(a), the Trustees shall file a
certificate of cancellation with the Secretary of State of the State of
Delaware.
(c) The provisions of Section 3.9 and Article X
shall survive the termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
Section 9.1 Transfer of Securities.
(a) Securities may only be transferred, in whole
or in part, in accordance with the terms and conditions set forth in this
Declaration and in the terms of the Securities. Any transfer or purported
transfer of any Security not made in accordance with this Declaration shall be
null and void.
(b) Subject to this Article IX, Preferred
Securities shall be freely transferable.
(c) The Sponsor may not transfer the Common
Securities.
Section 9.2 Transfer of Certificates.
The Regular Trustees shall provide for the registration of
Certificates and of transfers of Certificates, which will be effected without
charge but only upon payment (with such indemnity as the Regular Trustees may
require) in respect of any tax or other government charges that may be imposed
in relation to it. Upon surrender for registration of transfer of any
Certificate, the Regular Trustees shall cause one or more new Certificates to
be issued in the name of the designated transferee or transferees. Every
Certificate surrendered for registration of transfer shall be accompanied by a
written instrument of transfer in form satisfactory to the Regular Trustees
duly executed by the Holder or such Holder's attorney duly authorized in
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writing. Each Certificate surrendered for registration of transfer shall be
canceled by the Regular Trustees. A transferee of a Certificate shall be
entitled to the rights and subject to the obligations of a Holder hereunder
upon the receipt by such transferee of a Certificate. By acceptance of a
Certificate, each transferee shall be deemed to have agreed to be bound by this
Declaration.
Section 9.3 Deemed Security Holders.
The Trustees may treat the Person in whose name any
Certificate shall be registered on the books and records of the Trust as the
sole holder of such Certificate and of the Securities represented by such
Certificate for purposes of receiving Distributions and for all other purposes
whatsoever and, accordingly, shall not be bound to recognize any equitable or
other claim to or interest in such Certificate or in the Securities represented
by such Certificate on the part of any Person, whether or not the Trust shall
have actual or other notice thereof.
Section 9.4 Book Entry Interests.
Unless otherwise specified in the terms of the Preferred
Securities, the Preferred Securities Certificates, on original issuance, will
be issued in the form of one or more, fully registered, global Preferred
Security Certificates (each a "Global Certificate"), to be delivered to DTC,
the initial Clearing Agency, by, or on behalf of, the Trust. Such Global
Certificates shall initially be registered on the books and records of the
Trust in the name of Cede & Co., the nominee of DTC, and no Preferred Security
Beneficial Owner will receive a definitive Preferred Security Certificate
representing such Preferred Security Beneficial Owner's interests in such
Global Certificates, except as provided in Section 9.7. Unless and until
definitive, fully registered Preferred Security Certificates (the "Definitive
Preferred Security Certificates") have been issued to the Preferred Security
Beneficial Owners pursuant to Section 9.7:
(a) the provisions of this Section 9.4 shall be
in full force and effect;
(b) the Trust and the Trustees shall be entitled
to deal with the Clearing Agency for all purposes of this Declaration
(including the payment of Distributions on the Global Certificates and
receiving approvals, votes or consents hereunder) as the Holder of the
Preferred Securities and the sole holder of the Global Certificates and shall
have no obligation to the Preferred Security Beneficial Owners;
(c) to the extent that the provisions of this
Section 9.4 conflict with any other provisions of this Declaration, the
provisions of this Section 9.4 shall control; and
(d) the rights of the Preferred Security
Beneficial Owners shall be exercised only through the Clearing Agency and shall
be limited to those established by law and agreements between such Preferred
Security Beneficial Owners and the Clearing Agency and/or the Clearing Agency
Participants and receive and transmit payments of Distributions on the Global
Certificates to such Clearing Agency Participants. DTC will make book entry
transfers among the Clearing Agency Participants.
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Section 9.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Preferred
Security Holders is required under this Declaration, unless and until
Definitive Preferred Security Certificates shall have been issued to the
Preferred Security Beneficial Owners pursuant to Section 9.7, the Regular
Trustees shall give all such notices and communications specified herein to be
given to the Preferred Security Holders to the Clearing Agency, and shall have
no notice obligations to the Preferred Security Beneficial Owners.
Section 9.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Preferred Securities, the Regular
Trustees may, in their sole discretion, appoint a successor Clearing Agency
with respect to such Preferred Securities.
Section 9.7 Definitive Preferred Security Certificates.
If:
(a) a Clearing Agency elects to discontinue its
services as securities depositary with respect to the Preferred Securities and
a successor Clearing Agency is not appointed within 90 days after such
discontinuance pursuant to Section 9.6; or
(b) the Regular Trustees elect after consultation
with the Sponsor to terminate the book entry system through the Clearing Agency
with respect to the Preferred Securities,
then:
(c) Definitive Preferred Security Certificates
shall be prepared by the Regular Trustees on behalf of the Trust with respect
to such Preferred Securities; and
(d) upon surrender of the Global Certificates by
the Clearing Agency, accompanied by registration instructions, the Regular
Trustees shall cause Definitive Certificates to be delivered to Preferred
Security Beneficial Owners in accordance with the instructions of the Clearing
Agency. Neither the Trustees nor the Trust shall be liable for any delay in
delivery of such instructions and each of them may conclusively rely on and
shall be protected in relying on, said instructions of the Clearing Agency. The
Definitive Preferred Security Certificates shall be printed, lithographed or
engraved or may be produced in any other manner as is reasonably acceptable to
the Regular Trustees, as evidenced by their execution thereof, and may have
such letters, numbers or other marks of identification or designation and such
legends or endorsements as the Regular Trustees may deem appropriate, or as may
be required to comply with any law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on which Preferred
Securities may be listed, or to conform to usage.
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Section 9.8 Mutilated, Destroyed, Lost or Stolen
Certificates.
If:
(a) any mutilated Certificates should be
surrendered to the Regular Trustees, or if the Regular Trustees shall receive
evidence to their satisfaction of the destruction, loss or theft of any
Certificate; and
(b) there shall be delivered to the Regular
Trustees such security or indemnity as may be required by them to keep each of
them harmless.
then, in the absence of notice that such Certificate shall have been acquired
by a bona fide purchaser, any Regular Trustee on behalf of the Trust shall
execute and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like denomination.
In connection with the issuance of any new Certificate under this Section 9.8,
the Regular Trustees may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection therewith.
Any duplicate Certificate issued pursuant to this Section shall constitute
conclusive evidence of an ownership interest in the relevant Securities, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
ARTICLE X
LIMITATION OF LIABILITY OF HOLDERS
OF SECURITIES, TRUSTEES OR OTHERS
Section 10.1 Liability.
(a) Except as expressly set forth in this
Declara- tion, the Securities Guarantees and the terms of the Securities, the
Sponsor shall not be:
(i) personally liable for the return of any
portion of the capital contributions (or any return thereon)
of the Holders of the Securities which shall be made solely
from assets of the Trust; an
(ii) be required to pay to the Trust or to any
Holder of Securities any deficit upon dissolution of the Trust
or otherwise.
(b) The Holder of the Common Securities shall be
liable for all of the debts and obligations of the Trust (other than with
respect to the Securities) to the extent not satisfied out of the Trust's
assets.
(c) Pursuant to Section 3803(a) of the Business
Trust Act, the Holders of the Preferred Securities shall be entitled to the
same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the
State of Delaware.
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Section 10.2 Exculpation.
(a) No Indemnified Person shall be liable,
responsible or accountable in damages or otherwise to the Trust or any Covered
Person for any loss, damage or claim incurred by reason of any act or omission
performed or omitted by such Indemnified Person in good faith on behalf of the
Trust and in a manner such Indemnified Person reasonably believed to be within
the scope of the authority conferred on such Indemnified Person by this
Declaration or by law, except that an Indemnified Person shall be liable for
any such loss, damage or claim incurred by reason of such Indemnified Person's
gross negligence or willful misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully
protected in relying in good faith upon the records of the Trust and upon such
information, opinions, reports or statements presented to the Trust by any
Person as to matters the Indemnified Person reasonably believes are within such
other Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Trust, including information, opinions,
reports or statements as to the value and amount of the assets, liabilities,
profits, losses, or any other facts pertinent to the existence and amount of
assets from which Distributions to Holders of Securities might properly be
paid.
Section 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an
Indemnified Person has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to any other Covered Person, an Indemnified
Person acting under this Declaration shall not be liable to the Trust or to any
other Covered Person for its good faith reliance on the provisions of this
Declaration. The provisions of this Declaration, to the extent that they
restrict the duties and liabilities of an Indemnified Person otherwise existing
at law or in equity (other than the duties imposed on the Institutional Trustee
under the Trust Indenture Act), are agreed by the parties hereto to replace
such other duties and liabilities of such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or
arises between any Covered Persons; or
(ii) whenever this Declaration or any other
agreement contemplated herein or therein provides that an
Indemnified Person shall act in a manner that is, or provides
terms that are, fair and reasonable to the Trust or any Holder
of Securities, the Indemnified Person shall resolve such
conflict of interest, take such action or provide such terms,
considering in each the relative interest of each party
(including its own interest) to such conflict, agreement,
transaction or situation and the benefits and burdens relating
to such interests, any customary or accepted industry
practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the
Indemnified Person, the resolution,
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action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or
any other agreement contemplated herein or of any duty or
obligation of the Indemnified Person at law or in equity or
otherwise.
(c) Whenever in this Declaration an Indemnified
Person is permitted or required to make a decision:
(i) in its "discretion" or under a grant of
similar authority, the Indemnified Person shall be entitled to
consider such interests and factors as it desires, including
its own interests, and shall have no duty or obligation to
give any consideration to any interest of or factors affecting
the Trust or any other Person; or
(ii) in its "good faith" or under another express
standard, the Indemnified Person shall act under such express
standard and shall not be subject to any other or different
standard imposed by this Declaration or by applicable law.
Section 10.4 Indemnification.
(a) (i) The Debenture Issuer shall indemnify, to
the full extent permitted by law, any Company Indemnified 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, whether civil, criminal, administrative
or investigative (other than an action by or in the right of the Trust) by
reason of the fact that he is or was a Company Indemnified Person 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 Trust,
and, with respect to any criminal action or proceeding, had no reasonable cause
to believe his conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that
the Company Indemnified Person did not act in good faith and in a manner which
he reasonably believed to be in or not opposed to the best interests of the
Trust, and, with respect to any criminal action or proceeding, had reasonable
cause to believe that his conduct was unlawful.
(ii) The Debenture Issuer shall indemnify, to the
full extent permitted by law, any Company Indemnified Person
who was or is a party or is threatened to be made a party to
any threatened, pending or completed action or suit by or in
the right of the Trust to procure a judgment in its favor by
reason of the fact that he is or was a Company Indemnified
Person against expenses (including attorneys' fees) actually
and reasonably incurred by him in connection with the defense
or settlement of such action or suit if he
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acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Trust and
except that no such indemnification shall be made in respect
of any claim, issue or matter as to which such Company
Indemnified Person shall have been adjudged to be liable to
the Trust unless and only to the extent that the Court of
Chancery of Delaware or the court in which such action or suit
was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances
of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which such Court of Chancery or
such other court shall deem proper.
(iii) To the extent that a Company Indemnified
Person shall be successful on the merits or otherwise
(including dismissal of an action without prejudice or the
settlement of an action without admission of liability) in
defense of any action, suit or proceeding referred to in
paragraphs (i) and (ii) of this Section 10.4(a), or in defense
of any claim, issue or matter therein, he shall be
indemnified, to the full extent permitted by law, against
expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
(iv) Any indemnification under paragraphs (i) and
(ii) of this Section 10.4(a) (unless ordered by a court) shall
be made by the Debenture Issuer only as authorized in the
specific case upon a determination that indemnification of the
Company Indemnified Person is proper in the circumstances
because he has met the applicable standard of conduct set
forth in paragraphs (i) and (ii). Such determination shall be
made (1) by the Regular Trustees by a majority vote of a
quorum consisting of such Regular Trustees who were not
parties to such action, suit or proceeding, (2) if such a
quorum is not obtainable, or, even if obtainable, if a quorum
of disinterested Regular Trustees so directs, by independent
legal counsel in a written opinion, or (3) by the Common
Security Holder of the Trust.
(v) Expenses (including attorneys' fees) incurred
by a Company Indemnified Person in defending a civil,
criminal, administrative or investigative action, suit or
proceeding referred to in paragraphs (i) and (ii) of this
Section 10.4(a) shall be paid by the Debenture Issuer in
advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of
such Company Indemnified Person to repay such amount if it
shall ultimately be determined that he is not entitled to be
indemnified by the Debenture Issuer as authorized in this
Section 10.4(a).
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Notwithstanding the foregoing, no advance shall be made by the
Debenture Issuer if a determination is reasonably and promptly
made (i) by the Regular Trustees by a majority vote of a
quorum of disinterested Regular Trustees, (ii) if such a
quorum is not obtainable, or, even if obtainable, if a quorum
of disinterested Regular Trustees so directs, by independent
legal counsel in a written opinion or (iii) the Common
Security Holder of the Trust, that, based upon the facts known
to the Regular Trustees, counsel or the Common Security Holder
at the time such determination is made, such Company
Indemnified Person acted in bad faith or in a manner that such
person did not believe to be in or not opposed to the best
interests of the Trust, or, with respect to any criminal
proceeding, that such Company Indemnified Person believed or
had reasonable cause to believe his conduct was unlawful. In
no event shall any advance be made in instances where the
Regular Trustees, independent legal counsel or Common Security
Holder reasonably determine that such person deliberately
breached his duty to the Trust or its Common or Preferred
Security Holders.
(vi) The indemnification and advancement of
expenses provided by, or granted pursuant to, the other
paragraphs of this Section 10.4(a) shall not be deemed
exclusive of any other rights to which those seeking
indemnification and advancement of expenses may be entitled
under any agreement, vote of stockholders or disinterested
directors of the Debenture Issuer or Preferred Security
Holders of the Trust or otherwise, both as to action in his
official capacity and as to action in another capacity while
holding such office. All rights to indemnification under this
Section 10.4(a) shall be deemed to be provided by a contract
between the Debenture Issuer and each Company Indemnified
Person who serves in such capacity at any time while this
Section 10.4(a) is in effect. Any repeal or modification of
this Section 10.4(a) shall not affect any rights or
obligations then existing.
(vii) The Debenture Issuer or the Trust may
purchase and maintain insurance on behalf of any person who is
or was a Company Indemnified Person 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
Debenture Issuer would have the power to indemnify him against
such liability under the provisions of this Section 10.4(a).
(viii) For purposes of this Section 10.4(a),
references to "the Trust" shall include, in addition to the
resulting or surviving entity, any constituent entity
(including any constituent of a
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constituent) absorbed in a consolidation or merger, so that
any person who is or was a director, trustee, officer or
employee of such constituent entity, or is or was serving at
the request of such constituent entity as a director, trustee,
officer, employee or agent of another entity, shall stand in
the same position under the provisions of this Section 10.4(a)
with respect to the resulting or surviving entity as he would
have with respect to such constituent entity if its separate
existence had continued.
(ix) The indemnification and advancement of
expenses provided by, or granted pursuant to, this Section
10.4(a) shall, unless otherwise provided when authorized or
ratified, continue as to a person who has ceased to be a
Company Indemnified Person and shall inure to the benefit of
the heirs, executors and administrators of such a person.
(b) The Debenture Issuer agrees to indemnify the
(i) Institutional Trustee, (ii) the Delaware Trustee, (iii) any Affiliate of
the Institutional Trustee and the Delaware Trustee, and (iv) any officers,
directors, shareholders, members, partners, employees, representatives,
custodians, nominees or agents of the Institutional Trustee and the Delaware
Trustee (each of the Persons in (i) through (iv) being referred to as a
"Fiduciary Indemnified Person") for, and to hold each Fiduciary Indemnified
Person harmless against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration or the trust or trusts hereunder, including the
costs and expenses (including reasonable legal fees and expenses) of defending
itself against or investigating any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. The
obligation to indemnify as set forth in this Section 10.4(b) shall survive the
satisfaction and discharge of this Declaration.
Section 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee and the
Institutional Trustee may engage in or possess an interest in other business
ventures of any nature or description, independently or with others, similar or
dissimilar to the business of the Trust, and the Trust and the Holders of
Securities shall have no rights by virtue of this Declaration in and to such
independent ventures or the income or profits derived therefrom, and the
pursuit of any such venture, even if competitive with the business of the
Trust, shall not be deemed wrongful or improper. No Covered Person, the
Sponsor, the Delaware Trustee, or the Institutional Trustee shall be obligated
to present any particular investment or other opportunity to the Trust even if
such opportunity is of a character that, if presented to the Trust, could be
taken by the Trust, and any Covered Person, the Sponsor, the Delaware Trustee
and the Institutional Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any such
particular investment or other opportunity. Any Covered Person, the Delaware
Trustee and the Institutional Trustee may engage or be interested in any
financial or other transaction with the Sponsor or any Affiliate of the
Sponsor, or may act as depositary for, trustee
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<PAGE> 45
or agent for, or act on any committee or body of holders of, securities or
other obligations of the Sponsor or its Affiliates.
ARTICLE XI
ACCOUNTING
Section 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the
calendar year, or such other year as is required by the Code.
Section 11.2 Certain Accounting Matters.
(a) At all times during the existence of the
Trust, the Regular Trustees shall keep, or cause to be kept, full books of
account, records and supporting documents, which shall reflect in reasonable
detail, each transaction of the Trust. The books of account shall be maintained
on the accrual method of accounting, in accordance with generally accepted
accounting principles, consistently applied. The Trust shall use the accrual
method of accounting for United States federal income tax purposes. The books
of account and the records of the Trust shall be examined by and reported upon
as of the end of each Fiscal Year of the Trust by a firm of independent
certified public accountants selected by the Regular Trustees.
(b) The Regular Trustees shall cause to be
prepared and delivered to each of the Holders of Securities, within 90 days
after the end of each Fiscal Year of the Trust, annual financial statements of
the Trust, including a balance sheet of the Trust as of the end of such Fiscal
Year, and the related statements of income or loss;
(c) The Regular Trustees shall cause to be duly
prepared and delivered to each of the Holders of Securities, any annual United
States federal income tax information statement, required by the Code,
containing such information with regard to the Securities held by each Holder
as is required by the Code and the Treasury Regulations. Notwithstanding any
right under the Code to deliver any such statement at a later date, the Regular
Trustees shall endeavor to deliver all such statements within 30 days after the
end of each Fiscal Year of the Trust.
(d) The Regular Trustees shall cause to be duly
prepared and filed with the appropriate taxing authority, an annual United
States federal income tax return, on a Form 1041 or such other form required by
United States federal income tax law, and any other annual income tax returns
required to be filed by the Regular Trustees on behalf of the Trust with any
state or local taxing authority.
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<PAGE> 46
Section 11.3 Banking.
The Trust shall maintain one or more bank accounts in the name
and for the sole benefit of the Trust; provided, however, that all payments of
funds in respect of the Debentures held by the Institutional Trustee shall be
made directly to the Institutional Trustee Account and no other funds of the
Trust shall be deposited in the Institutional Trustee Account. The sole
signatories for such accounts shall be designated by the Regular Trustees;
provided, however, that the Institutional Trustee shall designate the
signatories for the Institutional Trustee Account.
Section 11.4 Withholding.
The Trust and the Regular Trustees shall comply with all
withholding requirements under United States federal, state and local law. The
Trust shall request, and the Holders shall provide to the Trust, such forms or
certificates as are necessary to establish an exemption from withholding with
respect to each Holder, and any representations and forms as shall reasonably
be requested by the Trust to assist it in determining the extent of, and in
fulfilling, its withholding obligations. The Regular Trustees shall file
required forms with applicable jurisdictions and, unless an exemption from
withholding is properly established by a Holder, shall remit amounts withheld
with respect to the Holder to applicable jurisdictions. To the extent that the
Trust is required to withhold and pay over any amounts to any authority with
respect to distributions or allocations to any Holder, the amount withheld
shall be deemed to be a distribution in the amount of the withholding to the
Holder. In the event of any claimed over withholding, Holders shall be limited
to an action against the applicable jurisdiction. If the amount required to be
withheld was not withheld from actual Distributions made, the Trust may reduce
subsequent Distributions by the amount of such withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
Section 12.1 Amendments.
(a) Except as otherwise provided in this
Declaration or by any applicable terms of the Securities, this Declaration may
only be amended by a written instrument approved and executed by:
(i) the Regular Trustees (or, if there are more
than two Regular Trustees a majority of the Regular Trustees);
(ii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Institutional
Trustee, the Institutional Trustee; and
(iii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Delaware Trustee, the
Delaware Trustee;
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<PAGE> 47
(b) no amendment shall be made, and any such
purported amendment shall be void and ineffective:
(i) unless, in the case of any proposed
amendment, the Institutional Trustee shall have first received
an Officers' Certificate from each of the Trust and the
Sponsor that such amendment is permitted by, and conforms to,
the terms of this Declaration (including the terms of the
Securities);
(ii) unless, in the case of any proposed amendment
which affects the rights, powers, duties, obligations or
immunities of the Institutional Trustee, the Institutional
Trustee shall have first received:
(A) an Officers' Certificate from each of the Trust and
the Sponsor that such amendment is permitted by, and conforms to, the terms of
this Declaration (including the terms of the Securities); and
(B) an opinion of counsel (who may be counsel to the
Sponsor or the Trust) that such amendment is permitted by, and conforms to, the
terms of this Declaration (including the terms of the Securities); and
(iii) to the extent the result of such amendment
would be to:
(A) cause the trust to fail to continue to be classified
for purposes of United States federal income taxation as a grantor trust;
(B) reduce or otherwise adversely affect the powers of
the Institutional Trustee in contravention of the Trust Indenture Act; or
(C) cause the Trust to be deemed to be an Investment
Company required to be registered under the Investment Company Act;
(c) at such time after the Trust has issued any
Securities that remain outstanding, any amendment that would adversely affect
the rights, privileges or preferences of any Holder of Securities may be
effected only with such additional requirements as may be set forth in the
terms of such Securities;
(d) Section 9.1(c) and this Section 12.1 shall
not be amended without the consent of all of the Holders of the Securities;
(e) Article IV shall not be amended without the
con- sent of the Holders of a Majority in liquidation amount of the Common
Securities and;
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<PAGE> 48
(f) the rights of the holders of the Common
Securities under Article V to increase or decrease the number of, and appoint
and remove Trustees shall not be amended without the consent of the Holders of
a Majority in liquidation amount of the Common Securities; and
(g) notwithstanding Section 12.1(c), this
Declaration may be amended without the consent of the Holders of the Securities
to:
(i) cure any ambiguity;
(ii) correct or supplement any provision in this
Declaration that may be defective or inconsistent with any
other provision of this Declaration;
(iii) add to the covenants, restrictions or
obligations of the Sponsor;
(iv) to conform to any change in Rule 3a-5 or
written change in interpretation or application of Rule 3a-5
by any legislative body, court, government agency or
regulatory authority which amendment does not have a material
adverse effect on the right, preferences or privileges of the
Holders; and
(v) to modify, eliminate and add to any provision
of the Amended Declaration to such extent as may be necessary.
Section 12.2 Meetings of the Holders of Securities; Action
by Written Consent.
(a) Meetings of the Holders of any class of
Securities may be called at any time by the Regular Trustees (or as provided in
the terms of the Securities) to consider and act on any matter on which Holders
of such class of Securities are entitled to act under the terms of this
Declaration, the terms of the Securities or the rules of any stock exchange on
which the Preferred Securities are listed or admitted for trading. The Regular
Trustees shall call a meeting of the Holders of such class if directed to do so
by the Holders of at least 10% in liquidation amount of such class of
Securities. Such direction shall be given by delivering to the Regular Trustees
one or more calls in a writing stating that the signing Holders of Securities
wish to call a meeting and indicating the general or specific purpose for which
the meeting is to be called. Any Holders of Securities calling a meeting shall
specify in writing the Security Certificates held by the Holders of Securities
exercising the right to call a meeting and only those Securities specified
shall be counted for purposes of determining whether the required percentage
set forth in the second sentence of this paragraph has been met.
(b) Except to the extent otherwise provided in
the terms of the Securities, the following provisions shall apply to meetings
of Holders of Securities:
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<PAGE> 49
(i) notice of any such meeting shall be given to
all the Holders of Securities having a right to vote thereat
at least 7 days and not more than 60 days before the date of
such meeting. Whenever a vote, consent or approval of the
Holders of Securities is permitted or required under this
Declaration or the rules of any stock exchange on which the
Preferred Securities are listed or admitted for trading, such
vote, consent or approval may be given at a meeting of the
Holders of Securities. Any action that may be taken at a
meeting of the Holders of Securities may be taken without a
meeting if a consent in writing setting forth the action so
taken is signed by the Holders of Securities owning not less
than the minimum amount of Securities in liquidation amount
that would be necessary to authorize or take such action at a
meeting at which all Holders of Securities having a right to
vote thereon were present and voting. Prompt notice of the
taking of action without a meeting shall be given to the
Holders of Securities entitled to vote who have not consented
in writing. The Regular Trustees may specify that any written
ballot submitted to the Security Holder for the purpose of
taking any action without a meeting shall be returned to the
Trust within the time specified by the Regular Trustees;
(ii) each Holder of a Security may authorize any
Person to act for it by proxy on all matters in which a Holder
of Securities is entitled to participate, including waiving
notice of any meeting, or voting or participating at a
meeting. No proxy shall be valid after the expiration of 11
months from the date thereof unless otherwise provided in the
proxy. Every proxy shall be revocable at the pleasure of the
Holder of Securities executing it. Except as otherwise
provided herein, all matters relating to the giving, voting or
validity of proxies shall be governed by the General
Corporation Law of the State of Delaware relating to proxies,
and judicial interpretations thereunder, as if the Trust were
a Delaware corporation and the Holders of the Securities were
stockholders of a Delaware corporation;
(iii) each meeting of the Holders of the Securities
shall be conducted by the Regular Trustees or by such other
Person that the Regular Trustees may designate; and
(iv) unless the Business Trust Act, this
Declaration, the terms of the Securities, the Trust Indenture
Act or the listing rules of any stock exchange on which the
Preferred Securities are then listed or trading, otherwise
provides, the Regular Trustees, in their sole discretion,
shall establish all other provisions relating to meetings of
Holders of Securities, including notice of the time, place or
purpose of any meeting at which any matter is to be voted on
by any Holders
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<PAGE> 50
of Securities, waiver of any such notice, action by consent
without a meeting, the establishment of a record date, quorum
requirements, voting in person or by proxy or any other matter
with respect to the exercise of any such right to vote.
ARTICLE XIII
REPRESENTATIONS OF INSTITUTIONAL TRUSTEE
AND DELAWARE TRUSTEE
Section 13.1 Representations and Warranties of
Institutional Trustee.
The Trustee that acts as initial Institutional Trustee
represents and warrants to the Trust and to the Sponsor at the date of this
Declaration, and each Successor Institutional Trustee represents and warrants
to the Trust and the Sponsor at the time of the Successor Institutional
Trustee's acceptance of its appointment as Institutional Trustee that:
(a) the Institutional Trustee is a national
banking association with trust powers, duly organized, validly existing and in
good standing under the laws of the United States, with trust power and
authority to execute and deliver, and to carry out and perform its obligations
under the terms of, the Declaration;
(b) the execution, delivery and performance by
the Institutional Trustee of the Declaration has been duly authorized by all
necessary corporate action on the part of the Institutional Trustee. The
Declaration has been duly executed and delivered by the Institutional Trustee,
and it constitutes a legal, valid and binding obligation of the Institutional
Trustee, enforceable against it in accordance with its terms, subject to
applicable bankruptcy, reorganization, moratorium, insolvency, and other
similar laws affecting creditors' rights generally and to general principles of
equity and the discretion of the court (regardless of whether the enforcement
of such remedies is considered in a proceeding in equity or at law);
(c) the execution, delivery and performance of
the Declaration by the Institutional Trustee does not conflict with or
constitute a breach of the Articles of Organization or By-laws of the
Institutional Trustee; and
(d) no consent, approval or authorization of, or
registration with or notice to, any State or Federal banking authority is
required for the execution, delivery or performance by the Institutional
Trustee, of the Declaration.
Section 13.2 Representations and Warranties of Delaware
Trustee.
The Trustee that acts as initial Delaware Trustee represents
and warrants to the Trust and to the Sponsor at the date of this Declaration,
and each Successor Delaware Trustee represents and warrants to the Trust and
the Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:
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<PAGE> 51
(a) The Delaware Trustee is a Delaware banking
corporation with trust powers, duly organized, validly existing and in good
standing under the laws of the State of Delaware, with trust power and
authority to execute and deliver, and to carry out and perform its obligations
under the terms of, the Declaration.
(b) The Delaware Trustee has been authorized to
perform its obligations under the Certificate of Trust and the Declaration. The
Declaration under Delaware law constitutes a legal, valid and binding
obligation of the Delaware Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in
equity or at law).
(c) No consent, approval or authorization of, or
registration with or notice to, any State or Federal banking authority is
required for the execution, delivery or performance by the Delaware Trustee, of
the Declaration.
(d) The Delaware Trustee is a natural person who
is a resident of the State of Delaware or, if not a natural person, an entity
which has its principal place of business in the State of Delaware.
ARTICLE XIV
MISCELLANEOUS
Section 14.1 Notices.
All notices provided for in this Declaration shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by registered or certified mail, as follows:
(a) if given to the Trust, in care of the Regular
Trustees at the Trust's mailing address set forth below (or such other address
as the Trust may give notice of to the Holders of the Securities):
Phillips 66 Capital VI
c/o Phillips Petroleum Company
Phillips Building
Barklesville, Oklahoma 74004
Attention: _____________
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<PAGE> 52
(b) if given to the Delaware Trustee, at the
mailing address set forth below (or such other address as Delaware Trustee may
give notice of to the Holders of the Securities):
The Bank of New York (Delaware)
White Clay Center, Route 273
Newark, Delaware 19711
Attention: Corporate Trust Trustee
Administration
(c) if given to the Institutional Trustee, at the
Institutional Trustee's mailing address set forth below (or such other address
as the Institutional Trustee may give notice of to the Holders of the
Securities):
The Bank of New York
101 Barclay Street, 21 West
New York, New York 10286
Attention: Corporate Trust Trustee
Administration
(d) if given to the Holder of the Common
Securities, at the mailing address of the Sponsor set forth below (or such
other address as the Holder of the Common Securities may give notice to the
Trust):
Phillips Petroleum Company
Phillips Building
Bartlesville, Oklahoma 74004
Attention: _______________________
(e) if given to any other Holder, at the address
set forth on the books and records of the Trust.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
Section 14.2 Governing Law.
This Declaration and the rights of the parties hereunder shall
be governed by and interpreted in accordance with the laws of the State of
Delaware and all rights and remedies shall be governed by such laws without
regard to principles of conflict of laws.
Section 14.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust be
classified for United States federal income tax purposes as a grantor trust.
The provisions of this Declaration shall be interpreted to further this
intention of the parties.
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<PAGE> 53
Section 14.4 Headings.
Headings contained in this Declaration are inserted for
convenience of reference only and do not affect the interpretation of this
Declaration or any provision hereof.
Section 14.5 Successors and Assigns.
Whenever in this Declaration any of the parties hereto is
named or referred to, the successors and assigns of such party shall be deemed
to be included, and all covenants and agreements in this Declaration by the
Sponsor and the Trustees shall bind and inure to the benefit of their
respective successors and assigns, whether so expressed.
Section 14.6 Partial Enforceability.
If any provision of this Declaration, or the application of
such provision to any Person or circumstance, shall be held invalid, the
remainder of this Declaration, or the application of such provision to persons
or circumstances other than those to which it is held invalid, shall not be
affected thereby.
Section 14.7 Counterparts.
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and they
shall have the same force and effect as though all of the signers had signed a
single signature page.
IN WITNESS WHEREOF, the undersigned has caused these presents
to be executed as of the day and year first above written.
----------------------------------
T.C. Morris, as Regular Trustee
----------------------------------
John A. Carrig, as Regular Trustee
----------------------------------
R.B. Gisi, as Regular Trustee
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THE BANK OF NEW YORK
(DELAWARE), as Delaware Trustee
By:
--------------------------
Name: Title:
THE BANK OF NEW YORK, as
Institutional Trustee
By:
--------------------------
Name: Title:
PHILLIPS PETROLEUM COMPANY, as
Sponsor
By:
--------------------------
Name: Title:
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<PAGE> 55
ANNEX I
TERMS OF
___% TRUST ORIGINATED PREFERRED SECURITIES
___% TRUST ORIGINATED COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated
Declaration of Trust, dated as of _______, 1998 (as amended from time to time,
the "Declaration"), the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Preferred Securities and the
Common Securities are set out below (each capitalized term used but not defined
herein has the meaning set forth in the Declaration or, if not defined in such
Declaration, as defined in the Prospectus referred to below):
1. Designation and Number.
(a) Preferred Securities. [ ]
Preferred Securities of the Trust with an aggregate liquidation amount with
respect to the assets of the Trust of [ ] dollars ($[
]) and a liquidation amount with respect to the assets of the Trust of $25 per
preferred security, are hereby designated for the purposes of identification
only as "_____% Trust Originated Preferred Securities(SM) ('TOPrS'(SM))" ( the
"Preferred Securities"). The Preferred Security Certificates evidencing the
Preferred Securities shall be substantially in the form of Exhibit A-1 to the
Declaration, with such changes and additions thereto or deletions therefrom as
may be required by ordinary usage, custom or practice or to conform to the
rules of any stock exchange on which the Preferred Securities are listed.
(b) Common Securities. [ ] Common
Securities of the Trust with an aggregate liquidation amount with respect to
the assets of the Trust of [ ] dollars ($[ ]) and a
liquidation amount with respect to the assets of the Trust of $25 per common
security, are hereby designated for the purposes of identification only as
"______% Trust Originated Common Securities" (the "Common Securities"). The
Common Security Certificates evidencing the Common Securities shall be
substantially in the form of Exhibit A-2 to the Declaration, with such changes
and additions thereto or deletions therefrom as may be required by ordinary
usage, custom or practice.
2. Distributions.
(a) Distributions payable on each Security will
be fixed at a rate per annum of ______% (the "Coupon Rate") of the stated
liquidation amount of $25 per Security, such rate being the rate of interest
payable on the Debentures to be held by the Institutional Trustee.
Distributions in arrears for more than one quarter will bear interest thereon
compounded quarterly at the Coupon Rate (to the extent permitted by applicable
law). The term "Distributions" as used herein includes such cash distributions
and any such interest payable unless otherwise stated. A Distribution is
payable only to the extent that payments are made in respect of the Debentures
held by the Institutional Trustee and to the extent the Institutional Trustee
has funds available therefor. The amount of Distributions payable for any
period will be
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<PAGE> 56
computed for any full quarterly Distribution period on the basis of a 360-day
year of twelve 30-day months, and for any period shorter than a full quarterly
Distribution period for which Distributions are computed, Distributions will be
computed on the basis of the actual number of days elapsed per 90-day quarter.
(b) Distributions on the Securities will be
cumulative, will accrue from ________, 1998, and will be payable quarterly in
arrears, on [March 31, June 30, September 30, and December 31] of each year,
commencing on _______, 1998, except as otherwise described below. The Debenture
Issuer has the right under the Indenture to defer payments of interest by
extending the interest payment period from time to time on the Debentures for a
period not exceeding 20 consecutive quarters or extend beyond the maturity date
of the Debentures (each an "Extension Period"), during which Extension Period
no interest shall be due and payable on the Debentures, provided that no
Extension Period shall last beyond the date of maturity of the Debentures. As a
consequence of such deferral, Distributions will also be deferred. Despite such
deferral, quarterly Distributions will continue to accrue with interest thereon
(to the extent permitted by applicable law) at the Coupon Rate compounded
quarterly during any such Extension Period. Prior to the termination of any
such Extension Period, the Debenture Issuer may further extend such Extension
Period; provided that such Extension Period together with all such previous and
further extensions thereof may not exceed 20 consecutive quarters or extend
beyond the maturity of the Debentures. Payments of accrued Distributions will
be payable to Holders as they appear on the books and records of the Trust on
the first record date after the end of the Extension Period. Upon the
termination of any Extension Period and the payment of all amounts then due,
the Debenture Issuer may commence a new Extension Period, subject to the above
requirements.
(c) Distributions on the Securities will be
payable to the Holders thereof as they appear on the books and records of the
Trust on the relevant record dates. While the Preferred Securities remain in
book-entry only form, the relevant record dates shall be one Business Day prior
to the relevant payment dates which payment dates correspond to the interest
payment dates on the Debentures. Subject to any applicable laws and regulations
and the provisions of the Declaration, each such payment in respect of the
Preferred Securities will be made as described under the heading "Description
of the Preferred Securities -- Book-Entry Only Issuance -- The Depository Trust
Company" in the Prospectus Supplement dated ______, 1998, to the Prospectus
dated ______, 1998 (together, the "Prospectus"), of the Trust included in the
Registration Statement on Form S-3 of the Sponsor, the Trust and certain other
business trusts. The relevant record dates for the Common Securities shall be
the same record date as for the Preferred Securities. If the Preferred
Securities shall not continue to remain in book-entry only form, the relevant
record dates for the Preferred Securities, shall conform to the rules of any
securities exchange on which the securities are listed and, if none, shall be
selected by the Regular Trustees, which dates shall be at least one Business
Day but less than 60 Business Days before the relevant payment dates, which
payment dates correspond to the interest payment dates on the Debentures.
Distributions payable on any Securities that are not punctually paid on any
Distribution payment date, as a result of the Debenture Issuer having failed to
make a payment under the Debentures, will cease to be payable to
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<PAGE> 57
the Person in whose name such Securities are registered on the relevant record
date, and such defaulted Distribution will instead be payable to the Person in
whose name such Securities are registered on the special record date or other
specified date determined in accordance with the Indenture. If any date on
which Distributions are payable on the Securities is not a Business Day, then
payment of the Distribution payable on such date will be made on the next
succeeding day that is a Business Day (and without any interest or other
payment in respect of any such delay) except that, if such Business Day is in
the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date.
(d) In the event that there is any money or other
property held by or for the Trust that is not accounted for hereunder, such
property shall be distributed Pro Rata (as defined herein) among the Holders of
the Securities.
3. Liquidation Distribution Upon Dissolution.
In the event of any voluntary or involuntary dissolution,
winding-up or termination of the Trust, the Holders of the Securities on the
date of the dissolution, winding-up or termination, as the case may be, will be
entitled to receive out of the assets of the Trust available for distribution
to Holders of Securities after satisfaction of liabilities of creditors an
amount equal to the aggregate of the stated liquidation amount of $25 per
Security plus accrued and unpaid Distributions thereon to the date of payment
(such amount being the "Liquidation Distribution"), unless, in connection with
such dissolution, winding-up or termination, Debentures in an aggregate stated
principal amount equal to the aggregate stated liquidation amount of such
Securities, with an interest rate equal to the Coupon Rate of, and bearing
accrued and unpaid interest in an amount equal to the accrued and unpaid
Distributions on, such Securities, shall be distributed on a Pro Rata basis to
the Holders of the Securities in exchange for such Securities.
If, upon any such dissolution, the Liquidation Distribution
can be paid only in part because the Trust has insufficient assets available to
pay in full the aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on the Securities shall be paid on a Pro Rata basis.
4. Redemption and Distribution.
(a) Upon the repayment of the Debentures in whole
or in part, whether at maturity or upon redemption (either at the option of the
Debenture Issuer or pursuant to a Tax Event as described below), the proceeds
from such repayment or payment shall be simultaneously applied to redeem
Securities having an aggregate liquidation amount equal to the aggregate
principal amount of the Debentures so repaid or redeemed at a redemption price
of $25 per Security plus an amount equal to accrued and unpaid Distributions
thereon at the date of the redemption, payable in cash (the "Redemption
Price"). Holders will be given not less than 30 nor more than 60 days notice of
such redemption.
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<PAGE> 58
(b) If fewer than all the outstanding Securities
are to be so redeemed, the Common Securities and the Preferred Securities will
be redeemed Pro Rata and the Preferred Securities to be redeemed will be as
described in Section 4(f)(ii) below.
(c) If, at any time, a Tax Event (as defined
below) shall occur and be continuing the Regular Trustees shall, except in
certain limited circumstances described in this Section 4(c), dissolve the
Trust and, after satisfaction of creditors, cause Debentures held by the
Institutional Trustee, having an aggregate principal amount equal to the
aggregate stated liquidation amount of, with an interest rate identical to the
Coupon Rate of, and accrued and unpaid interest equal to accrued and unpaid
Distributions on, and having the same record date for payment as the
Securities, to be distributed to the Holders of the Securities in liquidation
of such Holders' interests in the Trust on a Pro Rata basis, within 90 days
following the occurrence of such Tax Event (the "90 Day Period"); provided,
however, that, as a condition of such dissolution and distribution, the Regular
Trustees shall have received an opinion of a nationally recognized independent
tax counsel experienced in such matters (a "No Recognition Opinion"), which
opinion may rely on published revenue rulings of the Internal Revenue Service,
to the effect that the Holders of the Securities will not recognize any gain or
loss for United States federal income tax purposes as a result of the
dissolution of the Trust and the distribution of Debentures, and provided,
further, that, if at the time there is available to the Trust the opportunity
to eliminate, within the 90 Day Period, the Tax Event by taking some
ministerial action, such as filing a form or making an election, or pursuing
some other similar reasonable measure that has no adverse effect on the Trust,
the Debenture Issuer, the Sponsor or the Holders of the Securities
("Ministerial Action"), the Trust will pursue such Ministerial Action in lieu
of dissolution.
If in the event of a Tax Event, (i) after receipt of a Tax
Event Opinion (as defined hereinafter) by the Regular Trustees, the Debenture
Issuer has received an opinion (a "Redemption Tax Opinion") of a nationally
recognized independent tax counsel experienced in such matters that, as a
result of a Tax Event, there is more than an insubstantial risk that the
Debenture Issuer would be precluded from deducting the interest on the
Debentures for United States federal income tax purposes even after the
Debentures were distributed to the Holders of Securities in liquidation of such
Holders' interests in the Trust as described in this Section 4(c), or (ii) the
Regular Trustees shall have been informed by such tax counsel that a No
Recognition Opinion cannot be delivered to the Trust, the Debenture Issuer
shall have the right at any time, upon not less than 30 nor more than 60 days
notice, to redeem the Debentures in whole or in part for cash within 90 days
following the occurrence of such Tax Event, and, following such redemption,
Securities with an aggregate liquidation amount equal to the aggregate
principal amount of the Debentures so redeemed shall be redeemed by the Trust
at the Redemption Price on a Pro Rata basis; provided, however, that, if at the
time there is available to the Debenture Issuer or the Trust the opportunity to
eliminate, within such 90 day period, the Special Event by taking some
Ministerial Action, the Trust or the Debenture Issuer will pursue such
Ministerial Action in lieu of redemption.
"Tax Event" means that the Regular Trustees shall have
received an opinion of a nationally recognized independent tax counsel
experienced in such matters (a "Dissolution Tax
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<PAGE> 59
Opinion") to the effect that on or after the date of the Prospectus Supplement,
as a result of (a) any amendment to, clarification of or change (including any
announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or
therein affecting taxation, (b) any judicial decision, official administrative
pronouncement, ruling, regulatory procedure, notice or announcement, including
any notice or announcement of intent to adopt such procedures or regulations
(an "Administrative Action") or (c) any amendment to, clarification of, or
change in the official position or the interpretation of such Administrative
Action or judicial decision that differs from the theretofore generally
accepted position, in each case, by any legislative body, court, governmental
authority or regulatory body, irrespective of the manner in which such
amendment, clarification or change is made known, which amendment,
clarification, or change is effective or such pronouncement or decision is
announced, in each case, on or after, the first date of issuance of the
Securities, there is more than an insubstantial risk that (i) the Trust is or
will be within 90 days of the date thereof, subject to United States federal
income tax with respect to interest accrued or received on the Debentures, (ii)
the Trust is, or will be within 90 days of the date thereof, subject to more
than a de minimis amount of taxes, duties or other governmental charges, or
(iii) interest payable by the Debenture Issuer to the Trust on the Debentures
is not, or within 90 days of the date thereof will not be, deductible, in whole
or in part, by the Debenture Issuer for United States federal income tax
purposes.
On and from the date fixed by the Regular Trustees for any
distribution of Debentures and dissolution of the Trust: (i) the Securities
will no longer be deemed to be outstanding, (ii) The Depository Trust Company
(the "Depository") or its nominee (or any successor Clearing Agency or its
nominee), as the record Holder of the Preferred Securities, will receive a
registered global certificate or certificates representing the Debentures to be
delivered upon such distribution and any certificates representing Securities,
except for certificates representing Preferred Securities held by the
Depository or its nominee (or any successor Clearing Agency or its nominee),
will be deemed to represent beneficial interests in the Debentures having an
aggregate principal amount equal to the aggregate stated liquidation amount of,
with an interest rate identical to the Coupon Rate of, and accrued and unpaid
interest equal to accrued and unpaid Distributions on such Securities until
such certificates are presented to the Debenture Issuer or its agent for
transfer or reissue.
(d) The Trust may not redeem fewer than all the
outstanding Securities unless all accrued and unpaid Distributions have been
paid on all Securities for all quarterly Distribution periods terminating on or
before the date of redemption.
(e) If the Debentures are distributed to holders
of the Securities, pursuant to the terms of the Indenture, the Debenture Issuer
will use its best efforts to have the Debentures listed on the New York Stock
Exchange or on such other exchange as the Preferred Securities were listed
immediately prior to the distribution of the Debentures.
(f) "Redemption or Distribution Procedures."
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<PAGE> 60
(i) Notice of any redemption of, or notice of
distribution of Debentures in exchange for the Securities (a
"Redemption/Distribution Notice") will be given by the Trust
by mail to each Holder of Securities to be redeemed or
exchanged not fewer than 30 nor more than 60 days before the
date fixed for redemption or exchange thereof which, in the
case of a redemption, will be the date fixed for redemption of
the Debentures. For purposes of the calculation of the date of
redemption or exchange and the dates on which notices are
given pursuant to this Section 4(f)(i), a Redemption/
Distribution Notice shall be deemed to be given on the day
such notice is first mailed by first-class mail, postage
prepaid, to Holders of Securities. Each
Redemption/Distribution Notice shall be addressed to the
Holders of Securities at the address of each such Holder
appearing in the books and records of the Trust. No defect in
the Redemption/Distribution Notice or in the mailing of either
thereof with respect to any Holder shall affect the validity
of the redemption or exchange proceedings with respect to any
other Holder.
(ii) In the event that fewer than all the
outstanding Securities are to be redeemed, the Securities to
be redeemed shall be redeemed Pro Rata from each Holder of
Preferred Securities, it being understood that, in respect of
Preferred Securities registered in the name of and held of
record by the Depository or its nominee (or any successor
Clearing Agency or its nominee) or any nominee, the
distribution of the proceeds of such redemption will be made
to each Clearing Agency Participant (or Person on whose behalf
such nominee holds such securities) in accordance with the
procedures applied by such agency or nominee.
(iii) If Securities are to be redeemed and the
Trust gives a Redemption/Distribution Notice, which notice may
only be issued if the Debentures are redeemed as set out in
this Section 4 (which notice will be irrevocable), then (A)
while the Preferred Securities are in book-entry only form,
with respect to the Preferred Securities, by 12:00 noon, New
York City time, on the redemption date, provided that the
Debenture Issuer has paid the Institutional Trustee a
sufficient amount of cash in connection with the related
redemption or maturity of the Debentures, the Institutional
Trustee will deposit irrevocably with the Depository or its
nominee (or successor Clearing Agency or its nominee) funds
sufficient to pay the applicable Redemption Price with respect
to the Preferred Securities and will give the Depository
irrevocable instructions and authority to pay the Redemption
Price to the Holders of the Preferred Securities, and (B) with
respect to Preferred Securities issued in definitive form
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<PAGE> 61
and Common Securities, provided that the Debenture Issuer has
paid the Institutional Trustee a sufficient amount of cash in
connection with the related redemption or maturity of the
Debentures, the Institutional Trustee will pay the relevant
Redemption Price to the Holders of such Securities by check
mailed to the address of the relevant Holder appearing on the
books and records of the Trust on the redemption date. If a
Redemption/Distribution Notice shall have been given and funds
deposited as required, if applicable, then immediately prior
to the close of business on the date of such deposit, or on
the redemption date, as applicable, distributions will cease
to accrue on the Securities so called for redemption and all
rights of Holders of such Securities so called for redemption
will cease, except the right of the Holders of such Securities
to receive the Redemption Price, but without interest on such
Redemption Price. Neither the Regular Trustees nor the Trust
shall be required to register or cause to be registered the
transfer of any Securities that have been so called for
redemption. If any date fixed for redemption of Securities is
not a Business Day, then payment of the Redemption Price
payable on such date will be made on the next succeeding day
that is a Business Day (and without any interest or other
payment in respect of any such delay) except that, if such
Business Day falls in the next calendar year, such payment
will be made on the immediately preceding Business Day, in
each case with the same force and effect as if made on such
date fixed for redemption. If payment of the Redemption Price
in respect of any Securities is improperly withheld or refused
and not paid either by the Institutional Trustee or by the
Sponsor as guarantor pursuant to the relevant Securities
Guarantee, Distributions on such Securities will continue to
accrue from the original redemption date to the actual date of
payment, in which case the actual payment date will be
considered the date fixed for redemption for purposes of
calculating the Redemption Price.
(iv) Redemption/Distribution Notices shall be sent
by the Regular Trustees on behalf of the Trust to (A) in
respect of the Preferred Securities, the Depository or its
nominee (or any successor Clearing Agency or its nominee) if
the Global Certificates have been issued or, if Definitive
Preferred Security Certificates have been issued, to the
Holder thereof, and (B) in respect of the Common Securities to
the Holder thereof.
(v) Subject to the foregoing and applicable law
(including, without limitation, United States federal
securities laws), provided the acquiror is not the Holder of
the Common Securities or the obligor under the Indenture, the
Sponsor or any of its subsidiaries
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<PAGE> 62
may at any time and from time to time purchase outstanding
Preferred Securities by tender, in the open market or by
private agreement.
5. Voting Rights - Preferred Securities.
(a) Except as provided under Sections 5(b) and 7
and as otherwise required by law and the Declaration, the Holders of the
Preferred Securities will have no voting rights.
(b) Subject to the requirements set forth in this
paragraph, the Holders of a majority in aggregate liquidation amount of the
Preferred Securities, voting separately as a class may direct the time, method,
and place of conducting any proceeding for any remedy available to the
Institutional Trustee, or exercising any trust or power conferred upon the
Institutional Trustee under the Declaration, including the right to direct the
Institutional Trustee, as holder of the Debentures, to (i) exercise the
remedies available under the Indenture conducting any proceeding for any remedy
available to the Debenture Trustee, or exercising any trust or power conferred
on the Debenture Trustee with respect to the Debentures, (ii) waive any past
default and its consequences that is waivable under Section ___ of the
Indenture, or (iii) exercise any right to rescind or annul a declaration that
the principal of all the Debentures shall be due and payable, provided,
however, that, where a consent under the Indenture would require the consent or
act of the Holders of greater than a majority of the Holders in principal
amount of Debentures affected thereby, (a "Super Majority"), the Institutional
Trustee may only give such consent or take such action at the written direction
of the Holders of at least the proportion in liquidation amount of the
Preferred Securities which the relevant Super Majority represents of the
aggregate principal amount of the Debentures outstanding. The Institutional
Trustee shall not revoke any action previously authorized or approved by a vote
of the Holders of the Preferred Securities. Other than with respect to
directing the time, method and place of conducting any remedy available to the
Institutional Trustee or the Debenture Trustee as set forth above, the
Institutional Trustee shall not take any action in accordance with the
directions of the Holders of the Preferred Securities under this paragraph
unless the Institutional Trustee has obtained an opinion of tax counsel to the
effect that for the purposes of United States federal income tax the Trust will
not be classified as other than a grantor trust on account of such action. If a
Declaration Event of Default has occurred and is continuing and such event is
attributable to the failure of the Debenture Issuer to pay interest or
principal on the Debentures on the date such interest or principal is otherwise
payable (or in the case of redemption, on the redemption date), then a holder
of Preferred Securities may directly institute a proceeding for enforcement of
payment to such Holder of the principal of or interest on the Debentures having
a principal amount equal to the aggregate liquidation amount of the Preferred
Securities of such holder (a "Direct Action") on or after the respective due
date specified in the Debentures. In connection with such Direct Action, the
rights of the holders of the Common Securities Holder will be subrogated to the
rights of such holder of Preferred Securities to the extent of any payment made
by the Issuer to such holder of Preferred Securities in such Direct Action.
Except as provided in the preceding sentences, the Holders of Preferred
Securities will not be able to exercise directly
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<PAGE> 63
any other remedy available to the holders of the Debentures. Any approval or
direction of Holders of Preferred Securities may be given at a separate meeting
of Holders of Preferred Securities convened for such purpose, at a meeting of
all of the Holders of Securities in the Trust or pursuant to written consent.
The Regular Trustees will cause a notice of any meeting at which Holders of
Preferred Securities are entitled to vote, or of any matter upon which action
by written consent of such Holders is to be taken, to be mailed to each Holder
of record of Preferred Securities. Each such notice will include a statement
setting forth (i) the date of such meeting or the date by which such action is
to be taken, (ii) a description of any resolution proposed for adoption at such
meeting on which such Holders are entitled to vote or of such matter upon which
written consent is sought and (iii) instructions for the delivery of proxies or
consents.
No vote or consent of the Holders of the Preferred Securities
will be required for the Trust to redeem and cancel Preferred Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
Notwithstanding that Holders of Preferred Securities are
entitled to vote or consent under any of the circumstances described above, any
of the Preferred Securities that are owned by the Sponsor or any Affiliate of
the Sponsor shall not be entitled to vote or consent and shall, for purposes of
such vote or consent, be treated as if they were not outstanding.
6. Voting Rights - Common Securities.
(a) Except as provided under Sections 7(b), (c)
and 8 as otherwise required by law and the Declaration, the Holders of the
Common Securities will have no voting rights.
(b) The Holders of the Common Securities are
entitled, in accordance with Article V of the Declaration, to vote to appoint,
remove or replace any Trustee or to increase or decrease the number of
Trustees.
(c) Subject to Section 2.6 of the Declaration and
only after the Event of Default with respect to the Preferred Securities has
been cured, waived, or otherwise eliminated and subject to the requirements of
the second to last sentence of this paragraph, the Holders of a Majority in
liquidation amount of the Common Securities, voting separately as a class, may
direct the time, method, and place of conducting any proceeding for any remedy
available to the Institutional Trustee, or exercising any trust or power
conferred upon the Institutional Trustee under the Declaration, including (i)
directing the time, method, place of conducting any proceeding for any remedy
available to the Debenture Trustee, or exercising any trust or power conferred
on the Debenture Trustee with respect to the Debentures, (ii) waive any past
default and its consequences that is waivable under Section ____ of the
Indenture, or (iii) exercise any right to rescind or annul a declaration that
the principal of all the Debentures shall be due and payable, provided that,
where a consent or action under the Indenture would require the consent or act
of the Holders of greater than a majority in principal amount of Debentures
affected thereby (a "Super Majority"), the Institutional Trustee may only give
such consent or take such action at the written direction of the Holders of at
least the proportion in liquidation
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<PAGE> 64
amount of the Common Securities which the relevant Super Majority represents of
the aggregate principal amount of the Debentures outstanding. Pursuant to this
Section 6(c), the Institutional Trustee shall not revoke any action previously
authorized or approved by a vote of the Holders of the Preferred Securities.
Other than with respect to directing the time, method and place of conducting
any remedy available to the Institutional Trustee or the Debenture Trustee as
set forth above, the Institutional Trustee shall not take any action in
accordance with the directions of the Holders of the Common Securities under
this paragraph unless the Institutional Trustee has obtained an opinion of tax
counsel to the effect that for the purposes of United States federal income tax
the Trust will not be classified as other than a grantor trust on account of
such action. If the Institutional Trustee fails to enforce its rights under the
Declaration, any Holder of Common Securities may institute a legal proceeding
directly against any Person to enforce the Institutional Trustee's rights under
the Declaration, without first instituting a legal proceeding against the
Institutional Trustee or any other Person.
Any approval or direction of Holders of Common Securities may
be given at a separate meeting of Holders of Common Securities convened for
such purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Regular Trustees will cause a notice of any
meeting at which Holders of Common Securities are entitled to vote, or of any
matter upon which action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of Common Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the date by
which such action is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such Holders are entitled to vote or of
such matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or consents.
No vote or consent of the Holders of the Common Securities
will be required for the Trust to redeem and cancel Common Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
7. Amendments to Declaration and Indenture.
(a) In addition to any requirements under Section
12.1 of the Declaration, if any proposed amendment to the Declaration provides
for, or the Regular Trustees otherwise propose to effect, (i) any action that
would adversely affect the powers, preferences or special rights of the
Securities, whether by way of amendment to the Declaration or otherwise, or
(ii) the dissolution, winding-up or termination of the Trust, other than as
described in Section 8.1 of the Declaration, then the Holders of outstanding
Securities voting together as a single class, will be entitled to vote on such
amendment or proposal (but not on any other amendment or proposal) and such
amendment or proposal shall not be effective except with the approval of the
Holders of at least a Majority in liquidation amount of the Securities,
affected thereby, provided, however, if any amendment or proposal referred to
in clause (i) above would adversely affect only the Preferred Securities or
only the Common Securities, then only the affected class will be entitled to
vote on such amendment or proposal and such amendment or proposal shall not be
effective except with the approval of a Majority in liquidation amount of such
class of Securities.
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<PAGE> 65
(b) In the event the consent of the Institutional
Trustee as the holder of the Debentures is required under the Indenture with
respect to any amendment, modification or termination on the Indenture or the
Debentures, the Institutional Trustee shall request the written direction of
the Holders of the Securities with respect to such amendment, modification or
termination and shall vote with respect to such amendment, modification or
termination as directed by a Majority in liquidation amount of the Securities
voting together as a single class; provided, however, that where a consent
under the Indenture would require the consent of the holders of greater than a
majority in aggregate principal amount of the Debentures (a "Super Majority"),
the Institutional Trustee may only give such consent at the direction of the
Holders of at least the proportion in liquidation amount of the Securities
which the relevant Super Majority represents of the aggregate principal amount
of the Debentures outstanding; provided, further, that the Institutional
Trustee shall not take any action in accordance with the directions of the
Holders of the Securities under this Section 7(b) unless the Institutional
Trustee has obtained an opinion of tax counsel to the effect that for the
purposes of United States federal income tax the Trust will not be classified
as other than a grantor trust on account of such action.
8. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each
Holder of Securities according to the aggregate liquidation amount of the
Securities held by the relevant Holder in relation to the aggregate liquidation
amount of all Securities outstanding unless, in relation to a payment, an Event
of Default under the Declaration has occurred and is continuing, in which case
any funds available to make such payment shall be paid first to each Holder of
the Preferred Securities pro rata according to the aggregate liquidation amount
of Preferred Securities held by the relevant Holder relative to the aggregate
liquidation amount of all Preferred Securities outstanding, and only after
satisfaction of all amounts owed to the Holders of the Preferred Securities, to
each Holder of Common Securities pro rata according to the aggregate
liquidation amount of Common Securities held by the relevant Holder relative to
the aggregate liquidation amount of all Common Securities outstanding.
9. Ranking.
The Preferred Securities rank pari passu and payment thereon
shall be made Pro Rata with the Common Securities except that, where a
Declaration Event of Default occurs and is continuing the rights of Holders of
the Common Securities to payment in respect of Distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights to payment
of the Holders of the Preferred Securities.
10. Listing.
The Regular Trustees shall use their best efforts to cause the
Preferred Securities to be listed for quotation on the New York Stock Exchange,
Inc.
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<PAGE> 66
11. Acceptance of Securities Guarantee and
Indenture.
Each Holder of Preferred Securities and Common Securities, by
the acceptance thereof, agrees to the provisions of the Preferred Securities
Guarantee and the Common Securities Guarantee, respectively, including the
subordination provisions therein and to the provisions of the Indenture.
12. No Preemptive Rights.
The Holders of the Securities shall have no preemptive rights
to subscribe for any additional securities.
13. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the
Preferred Securities Guarantee or the Common Securities Guarantee (as may be
appropriate), and the Indenture to a Holder without charge on written request
to the Sponsor at its principal place of business.
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<PAGE> 67
EXHIBIT A-1
FORM OF PREFERRED SECURITY CERTIFICATE
This Preferred Security is a Global Certificate within the
meaning of the Declaration hereinafter referred to and is registered in the
name of The Depository Trust Company (the "Depositary") or a nominee of the
Depositary. This Preferred Security is exchangeable for Preferred Securities
registered in the name of a person other than the Depositary or its nominee
only in the limited circumstances described in the Declaration and no transfer
of this Preferred Security (other than a transfer of this Preferred Security as
a whole by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary) may be
registered except in limited circumstances.
Unless this Preferred Security is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New York, New
York) to the Trust or its agent for registration of transfer, exchange or
payment, and any Preferred Security issued is registered in the name of Cede &
Co. or such other name as requested by an authorized representative of The
Depository Trust Company and any payment hereon is made to Cede & Co., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.
Certificate Number Number of Preferred Securities
CUSIP NO. [ ]
Certificate Evidencing Preferred Securities
of
PHILLIPS 66 CAPITAL VI
____% Trust Originated Preferred Securities(SM) ("TOPrS"(SM))
(liquidation amount $25 per Preferred Security)
PHILLIPS 66 CAPITAL VI, a statutory business trust formed under the laws of the
State of Delaware (the "Trust"), hereby certifies that ______________ (the
"Holder") is the registered owner of preferred securities of the Trust
representing undivided beneficial interests in the assets of the Trust
designated the _____% Trust Originated Preferred Securities(SM) (liquidation
amount $25 per Preferred Security) (the "Preferred Securities"). The Preferred
Securities are transferable on the books and records of the Trust, in person or
by a duly authorized attorney, upon surrender of this certificate duly endorsed
and in proper form for transfer. The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Preferred
Securities represented hereby are issued and shall in all respects be subject
to the provisions of the
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<PAGE> 68
Amended and Restated Declaration of Trust of the Trust dated as of _______,
1998, as the same may be amended from time to time (the "Declaration"),
including the designation of the terms of the Preferred Securities as set forth
in Annex I to the Declaration. Capitalized terms used herein but not defined
shall have the meaning given them in the Declaration. The Holder is entitled
to the benefits of the Preferred Securities Guarantee to the extent provided
therein. The Sponsor will provide a copy of the Declaration, the Preferred
Securities Guarantee and the Indenture to a Holder without charge upon written
request to the Trust at its principal place of business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Preferred
Securities as evidence of indirect beneficial ownership in the Debentures.
IN WITNESS WHEREOF, the Trust has executed this certificate
this ___ day of , 1998.
PHILLIPS 66 CAPITAL VI
By:
-------------------------------
Name: Title: Regular Trustee
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Preferred Security will be fixed
at a rate per annum of ______% (the "Coupon Rate") of the stated liquidation
amount of $__ per Preferred Security, such rate being the rate of interest
payable on the Debentures to be held by the Institutional Trustee.
Distributions in arrears for more than one quarter will bear interest thereon
compounded quarterly at the Coupon Rate (to the extent permitted by applicable
law). The term "Distributions" as used herein includes such cash distributions
and any such interest payable unless otherwise stated. A Distribution is
payable only to the extent that payments are made in respect of the Debentures
held by the Institutional Trustee and to the extent the Institutional Trustee
has funds available therefor. The amount of Distributions payable for any
period will be computed for any full quarterly Distribution period on the basis
of a 360-day year of twelve 30- day months, and for any period shorter than a
full quarterly Distribution period for which Distributions are computed,
Distributions will be computed on the basis of the actual number of days
elapsed per 90-day quarter.
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<PAGE> 69
Except as otherwise described below, distributions on the
Preferred Securities will be cumulative, will accrue from the date of original
issuance and will be payable quarterly in arrears, on [March 31, June 30,
September 30 and December 31] of each year, commencing on ________, 1998, to
[Holders of record fifteen (15) days prior to such payment dates, which payment
dates shall correspond to the interest payment dates on the Debentures.] The
Debenture Issuer has the right under the Indenture to defer payments of
interest by extending the interest payment period from time to time on the
Debentures for a period not exceeding 20 consecutive quarters (each an
"Extension Period"), provided that no Extension Period shall last beyond the
date of the maturity of the Debentures and as a consequence of such deferral,
Distributions will also be deferred. Despite such deferral, quarterly
Distributions will continue to accrue with interest thereon (to the extent
permitted by applicable law) at the Coupon Rate compounded quarterly during any
such Extension Period. Prior to the termination of any such Extension Period,
the Debenture Issuer may further extend such Extension Period; provided that
such Extension Period together with all such previous and further extensions
thereof may not exceed 20 consecutive quarters or extend beyond the maturity of
the Debentures. Payments of accrued Distributions will be payable to Holders as
they appear on the books and records of the Trust on the first record date
after the end of the Extension Period. Upon the termination of any Extension
Period and the payment of all amounts then due, the Debenture Issuer may
commence a new Extension Period, subject to the above requirements.
The Preferred Securities shall be redeemable as provided in
the Declaration.
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<PAGE> 70
---------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security Certificate to
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
agent to transfer this Preferred Security Certificate on the books of the
Trust. The agent may substitute another to act for him or her.
Date:
-----------------------
Signature:
--------------------------------------
(Sign exactly as your name appears on the other side of this Preferred Security
Certificate)
- 1 -
<PAGE> 71
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE
Certificate Number Number of Common Securities
Certificate Evidencing Common Securities
of
PHILLIPS 66 CAPITAL VI
______% Trust Originated Common Securities
(liquidation amount $25 per Common Security)
PHILLIPS 66 CAPITAL VI, a statutory business trust formed
under the laws of the State of Delaware (the "Trust"), hereby certifies that
_________________ (the "Holder") is the registered owner of common securities
of the Trust representing undivided beneficial interests in the assets of the
Trust designated the ______% Trust Originated Common Securities (liquidation
amount $25 per Common Security) (the "Common Securities"). The Common
Securities are transferable on the books and records of the Trust, in person or
by a duly authorized attorney, upon surrender of this certificate duly endorsed
and in proper form for transfer. The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Common
Securities represented hereby are issued and shall in all respects be subject
to the provisions of the Amended and Restated Declaration of Trust of the Trust
dated as of _______, 1998, as the same may be amended from time to time (the
"Declaration"), including the designation of the terms of the Common Securities
as set forth in Annex I to the Declaration. Capitalized terms used herein but
not defined shall have the meaning given them in the Declaration. The Holder is
entitled to the benefits of the Common Securities Guarantee to the extent
provided therein. The Sponsor will provide a copy of the Declaration, the
Common Securities Guarantee and the Indenture to a Holder without charge upon
written request to the Sponsor at its principal place of business.
Upon receipt of this certificate, the Sponsor is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Common
Securities as evidence of indirect beneficial ownership in the Debentures.
- 1 -
<PAGE> 72
IN WITNESS WHEREOF, the Trust has executed this certificate
this ___ day of , 1998.
PHILLIPS 66 CAPITAL VI
By:
------------------------------
Name: Title: Regular Trustee
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<PAGE> 73
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Common Security will be fixed at
a rate per annum of ______% (the "Coupon Rate") of the stated liquidation
amount of $__ per Common Security, such rate being the rate of interest payable
on the Debentures to be held by the Institutional Trustee. Distributions in
arrears for more than one quarter will bear interest thereon compounded
quarterly at the Coupon Rate (to the extent permitted by applicable law). The
term "Distributions" as used herein includes such cash distributions and any
such interest payable unless otherwise stated. A Distribution is payable only
to the extent that payments are made in respect of the Debentures held by the
Institutional Trustee and to the extent the Institutional Trustee has funds
available therefor. The amount of Distributions payable for any period will be
computed for any full quarterly Distribution period on the basis of a 360-day
year of twelve 30- day months, and for any period shorter than a full quarterly
Distribution period for which Distributions are computed, Distributions will be
computed on the basis of the actual number of days elapsed per 90-day quarter.
Except as otherwise described below, distributions on the
Common Securities will be cumulative, will accrue from the date of original
issuance and will be payable quarterly in arrears, on [March 31, June 30,
September 30 and December 31] of each year, commencing on ________, 1998, to
Holders of record fifteen (15) days prior to such payment dates, which payment
dates shall correspond to the interest payment dates on the Debentures. The
Debenture Issuer has the right under the Indenture to defer payments of
interest by extending the interest payment period from time to time on the
Debentures for a period not exceeding 20 consecutive quarters (each an
"Extension Period"), provided that no Extension Period shall last beyond the
date of the maturity of the Debentures and as a consequence of such deferral,
Distributions will also be deferred. Despite such deferral, quarterly
Distributions will continue to accrue with interest thereon (to the extent
permitted by applicable law) at the Coupon Rate compounded quarterly during any
such Extension Period. Prior to the termination of any such Extension Period,
the Debenture Issuer may further extend such Extension Period; provided that
such Extension Period together with all such previous and further extensions
thereof may not exceed 20 consecutive quarters or extend beyond the maturity
date of the Debentures. Payments of accrued Distributions will be payable to
Holders as they appear on the books and records of the Trust on the first
record date after the end of the Extension Period. Upon the termination of any
Extension Period and the payment of all amounts then due, the Debenture Issuer
may commence a new Extension Period, subject to the above requirements.
The Common Securities shall be redeemable as provided in the
Declaration.
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<PAGE> 74
---------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this
Common Security Certificate to:
-----------------------------------------------
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
agent to transfer this Common Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.
Date:
-----------------------
Signature:
----------------------------------------
(Sign exactly as your name appears on the other side of this Common Security
Certificate)
- 1 -
<PAGE> 75
EXHIBIT B
SPECIMEN OF DEBENTURE
<PAGE> 76
EXHIBIT C
UNDERWRITING AGREEMENT
C-1
<PAGE> 1
EXHIBIT 4-U
========================================
PREFERRED SECURITIES GUARANTEE AGREEMENT
Phillips 66 Capital V
Dated as of _______ __, 1998
========================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE I
DEFINITIONS AND INTERPRETATION 1
SECTION 1.1 Definitions and Interpretation 1
ARTICLE II
TRUST INDENTURE ACT 4
SECTION 2.1 Trust Indenture Act; Application 4
SECTION 2.2 Lists of Holders of Securities 5
SECTION 2.3 Reports by the Preferred Guarantee Trustee 5
SECTION 2.4 Periodic Reports to Preferred Guarantee Trustee 5
SECTION 2.5 Evidence of Compliance with Conditions Precedent 5
SECTION 2.6 Events of Default; Waiver 5
SECTION 2.7 Event of Default; Notice 6
SECTION 2.8 Conflicting Interests 6
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE 6
SECTION 3.1 Powers and Duties of the Preferred Guarantee Trustee 6
SECTION 3.2 Certain Rights of Preferred Guarantee Trustee 8
SECTION 3.3 Not Responsible for Recitals of Issuance of Guarantee 10
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE 10
SECTION 4.1 Preferred Guarantee Trustee; Eligibility 10
SECTION 4.2 Appointment, Removal and Resignation of Preferred Guarantee 10
Trustees
ARTICLE V
GUARANTEE 11
SECTION 5.1 Guarantee 11
SECTION 5.2 Waiver of Notice and Demand 11
SECTION 5.3 Obligations Not Affected 12
SECTION 5.4 Rights of Holders 12
SECTION 5.5 Guarantee of Payment 13
SECTION 5.6 Subrogation 13
SECTION 5.7 Independent Obligations 13
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
14
SECTION 6.1 Limitation of Transactions 14
</TABLE>
<PAGE> 3
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
SECTION 6.2 Ranking 14
ARTICLE VII
TERMINATION 14
SECTION 7.1 Termination 14
ARTICLE VIII
INDEMNIFICATION 15
SECTION 8.1 Exculpation 15
SECTION 8.2 Indemnification 15
ARTICLE IX
MISCELLANEOUS 15
SECTION 9.1 Successors and Assigns 15
SECTION 9.2 Amendments 16
SECTION 9.3 Notices 16
SECTION 9.4 Benefit 17
SECTION 9.5 Governing Law 16
</TABLE>
- ii -
<PAGE> 4
PREFERRED SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Preferred Securities
Guarantee"), dated as of _______ __, 1998, is executed and delivered by
Phillips Petroleum Company, a Delaware corporation (the "Guarantor"), and The
Bank of New York, a New York banking corporation, as trustee (the "Preferred
Guarantee Trustee"), for the benefit of the Holders (as defined herein) from
time to time of the Preferred Securities (as defined herein) of Phillips 66
Capital V, a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of
Trust (the "Declaration"), dated as of ________, 1998, among the trustees of
the Issuer named therein, the Guarantor, as sponsor, and the holders from time
to time of undivided beneficial interests in the assets of the Issuer, the
Issuer is issuing on the date hereof [ ] preferred securities, having an
aggregate liquidation amount of $[ ] (plus up to an additional [ ] preferred
securities, having an aggregate liquidation amount of $[ ], to cover
over-allotments)], designated the _____% Trust Originated Preferred Securities
(the "Preferred Securities");
WHEREAS, as incentive for the Holders to purchase the
Preferred Securities, the Guarantor desires irrevocably and unconditionally to
agree, to the extent set forth in this Preferred Securities Guarantee, to pay
to the Holders of the Preferred Securities the Guarantee Payments (as defined
herein) and to make certain other payments on the terms and conditions set
forth herein.
WHEREAS, the Guarantor is also executing and delivering a
guarantee agreement (the "Common Securities Guarantee") in substantially
identical terms to this Preferred Securities Guarantee for the benefit of the
holders of the Common Securities (as defined herein), except that if an Event
of Default (as defined in the Indenture), has occurred and is continuing, the
rights of holders of the Common Securities to receive Guarantee Payments under
the Common Securities Guarantee are subordinated to the rights of Holders of
Preferred Securities to receive Guarantee Payments under this Preferred
Securities Guarantee.
NOW, THEREFORE, in consideration of the purchase by each
Holder of Preferred Securities, which purchase the Guarantor hereby agrees
shall benefit the Guarantor, the Guarantor executes and delivers this Preferred
Securities Guarantee for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this Preferred Securities Guarantee, unless the context
otherwise requires:
<PAGE> 5
(a) Capitalized terms used in this Preferred
Securities Guarantee but not defined in the preamble above have the respective
meanings assigned to them in this Section 1.1;
(b) a term defined anywhere in this Preferred
Securities Guarantee has the same meaning throughout;
(c) all references to "the Preferred Securities
Guarantee" or "this Preferred Securities Guarantee" are to this Preferred
Securities Guarantee as modified, supplemented or amended from time to time;
(d) all references in this Preferred Securities
Guarantee to Articles and Sections are to Articles and Sections of this
Preferred Securities Guarantee, unless otherwise specified;
(e) a term defined in the Trust Indenture Act has
the same meaning when used in this Preferred Securities Guarantee, unless
otherwise defined in this Preferred Securities Guarantee or unless the context
otherwise requires; and
(f) a reference to the singular includes the
plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act of 1933, as amended, or any successor rule
thereunder.
"Business Day" means any day other than a day on which banking
institutions in the City of New York, New York are authorized or required by
any applicable law to close.
"Common Securities" means the securities representing common
undivided beneficial interests in the assets of the Issuer.
"Corporate Trust Office" means the office of the Preferred
Guarantee Trustee at which the corporate trust business of the Preferred
Guarantee Trustee shall, at any particular time, be principally administered,
which office at the date of execution of this Agreement is located at 101
Barclay Street, 21 West, New York, New York 10286.
"Covered Person" means any Holder or beneficial owner of
Preferred Securities.
"Debentures" means the series of junior subordinated debt
securities of the Guarantor designated the ___% [Junior Subordinated Deferrable
Interest Debentures] due [ ] held by the Institutional Trustee (as defined
in the Declaration) of the Issuer.
"Event of Default" means a default by the Guarantor on any of
its payment or other obligations under this Preferred Securities Guarantee.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Preferred Securities,
to the extent not paid or made by the Issuer:
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<PAGE> 6
(i) any accrued and unpaid Distributions (as defined in the Declaration) that
are required to be paid on such Preferred Securities to the extent the Issuer
shall have funds available therefor, (ii) the redemption price, including all
accrued and unpaid Distributions to the date of redemption (the "Redemption
Price") to the extent the Issuer has funds available therefor, with respect to
any Preferred Securities called for redemption by the Issuer, and (iii) upon a
voluntary or involuntary dissolution, winding-up or termination of the Issuer
(other than in connection with the distribution of Debentures to the Holders in
exchange for Preferred Securities as provided in the Declaration), the lesser
of (a) the aggregate of the liquidation amount and all accrued and unpaid
Distributions on the Preferred Securities to the date of payment, to the extent
the Issuer shall have funds available therefor, and (b) the amount of assets of
the Issuer remaining available for distribution to Holders in liquidation of
the Issuer (in either case, the "Liquidation Distribution"). If an event of
default under the Indenture has occurred and is continuing, the rights of
holders of the Common Securities to receive payments under the Common
Securities Guarantee Agreement are subordinated to the rights of Holders of
Preferred Securities to receive Guarantee Payments.
"Holder" shall mean any holder, as registered on the books and
records of the Issuer of any Preferred Securities; provided, however, that, in
determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder,
"Holder" shall not include the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Preferred Guarantee Trustee,
any Affiliate of the Preferred Guarantee Trustee, or any officers, directors,
shareholders, members, partners, employees, representatives, nominees,
custodians or agents of the Preferred Guarantee Trustee.
"Indenture" means the Indenture dated as of _______, 1998,
among the Guarantor (the "Debenture Issuer") and The Bank of New York, N.A., as
trustee, and any indenture supplemental thereto pursuant to which certain
subordinated debt securities of the Debenture Issuer are to be issued to the
Property Trustee of the Issuer.
"Majority in liquidation amount of the Securities" means,
except as provided by the Trust Indenture Act, a vote by Holder(s) of Preferred
Securities, voting separately as a class, of more than 50% of the liquidation
amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accrued and unpaid Distributions to the date
upon which the voting percentages are determined) of all Preferred Securities.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Preferred Securities Guarantee shall include:
(a) a statement that each officer signing the
Officers' Certificate has read the covenant or condition and the definition
relating thereto;
(b) a brief statement of the nature and scope of
the examination or investigation undertaken by each officer in rendering the
Officers' Certificate;
- 3 -
<PAGE> 7
(c) a statement that each such officer has made
such examination or investigation as, in such officer's opinion, is necessary
to enable such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of
each such officer, such condition or covenant has been complied with.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Preferred Guarantee Trustee" means The Bank of New York, a
New York banking corporation, until a Successor Preferred Guarantee Trustee has
been appointed and has accepted such appointment pursuant to the terms of this
Preferred Securities Guarantee and thereafter means each such Successor
Preferred Guarantee Trustee.
"Responsible Officer" means, with respect to the Preferred
Guarantee Trustee, any officer within the Corporate Trust Office of the
Preferred Guarantee Trustee, including any vice president, any assistant vice
president, any assistant secretary, the treasurer, any assistant treasurer or
other officer of the Corporate Trust Office of the Preferred Guarantee Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate
trust matter, any other officer to whom such matter is referred because of that
officer's knowledge of and familiarity with the particular subject.
"Successor Preferred Guarantee Trustee" means a successor
Preferred Guarantee Trustee possessing the qualifications to act as Preferred
Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended.
"Trust Securities" means the Common Securities and the
Preferred Securities.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
(a) This Preferred Securities Guarantee is
subject to the provisions of the Trust Indenture Act that are required to be
part of this Preferred Securities Guarantee and shall, to the extent
applicable, be governed by such provisions; and
(b) if and to the extent that any provision of
this Preferred Securities Guarantee limits, qualifies or conflicts with the
duties imposed by Section 310 to 317, inclusive, of the Trust Indenture Act,
such imposed duties shall control.
- 4 -
<PAGE> 8
SECTION 2.2 Lists of Holders of Securities
(a) The Guarantor shall provide the Preferred
Guarantee Trustee with a list, in such form as the Preferred Guarantee Trustee
may reasonably require, of the names and addresses of the Holders of the
Preferred Securities ("List of Holders") as of such date, (i) within 1 Business
Day after January 1 and June 30 of each year, and (ii) at any other time within
30 days of receipt by the Guarantor of a written request for a List of Holders
as of a date no more than 14 days before such List of Holders is given to the
Preferred Guarantee Trustee provided, that the Guarantor shall not be obligated
to provide such List of Holders at any time the List of Holders does not differ
from the most recent List of Holders given to the Preferred Guarantee Trustee
by the Guarantor. The Preferred Guarantee Trustee may destroy any List of
Holders previously given to it on receipt of a new List of Holders.
(b) The Preferred Guarantee Trustee shall comply
with its obligations under Sections 311(a), 311(b) and Section 312(b) of the
Trust Indenture Act.
SECTION 2.3 Reports by the Preferred Guarantee Trustee
Within 60 days after May 15 of each year, the Preferred
Guarantee Trustee shall provide to the Holders of the Preferred Securities such
reports as are required by Section 313 of the Trust Indenture Act, if any, in
the form and in the manner provided by Section 313 of the Trust Indenture Act.
The Preferred Guarantee Trustee shall also comply with the requirements of
Section 313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Preferred Guarantee Trustee
The Guarantor shall provide to the Preferred Guarantee Trustee
such documents, reports and information as required by Section 314 (if any) and
the compliance certificate required by Section 314 of the Trust Indenture Act
in the form, in the manner and at the times required by Section 314 of the
Trust Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent
The Guarantor shall provide to the Preferred Guarantee Trustee
such evidence of compliance with any conditions precedent, if any, provided for
in this Preferred Securities Guarantee that relate to any of the matters set
forth in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) may be given
in the form of an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver
The Holders of a Majority in liquidation amount of Preferred
Securities may, by vote, on behalf of the Holders of all of the Preferred
Securities, waive any past Event of Default and its consequences. Upon such
waiver, any such Event of Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this
- 5 -
<PAGE> 9
Preferred Securities Guarantee, but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.
SECTION 2.7 Event of Default; Notice
(a) The Preferred Guarantee Trustee shall, within
90 days after the occurrence of an Event of Default, transmit by mail, first
class postage prepaid, to the Holders of the Preferred Securities, notices of
all Events of Default actually known to a Responsible Officer of the Preferred
Guarantee Trustee, unless such defaults have been cured before the giving of
such notice, provided, that, the Preferred Guarantee Trustee shall be protected
in withholding such notice if and so long as a Responsible Officer of the
Preferred Guarantee Trustee in good faith determines that the withholding of
such notice is in the interests of the Holders of the Preferred Securities.
(b) The Preferred Guarantee Trustee shall not be
deemed to have knowledge of any Event of Default unless the Preferred Guarantee
Trustee shall have received written notice, or of which a Responsible Officer
of the Preferred Guarantee Trustee charged with the administration of the
Declaration shall have obtained actual knowledge.
SECTION 2.8 Conflicting Interests
The Declaration shall be deemed to be specifically described
in this Preferred Securities Guarantee for the purposes of clause (i) of the
first proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Preferred Guarantee Trustee
(a) This Preferred Securities Guarantee shall be
held by the Preferred Guarantee Trustee for the benefit of the Holders of the
Preferred Securities, and the Preferred Guarantee Trustee shall not transfer
this Preferred Securities Guarantee to any Person except a Holder of Preferred
Securities exercising his or her rights pursuant to Section 5.4(b) or to a
Successor Preferred Guarantee Trustee on acceptance by such Successor Preferred
Guarantee Trustee of its appointment to act as Successor Preferred Guarantee
Trustee. The right, title and interest of the Preferred Guarantee Trustee
shall automatically vest in any Successor Preferred Guarantee Trustee, and such
vesting and cessation of title shall be effective whether or not conveyancing
documents have been executed and delivered pursuant to the appointment of such
Successor Preferred Guarantee Trustee.
(b) If an Event of Default actually known to a
Responsible Officer of the Preferred Guarantee Trustee has occurred and is
continuing, the Preferred Guarantee Trustee shall enforce this Preferred
Securities Guarantee for the benefit of the Holders of the Preferred
Securities.
- 6 -
<PAGE> 10
(c) Preferred Guarantee Trustee, before the
occurrence of any Event of Default and after the curing of all Events of
Default that may have occurred, shall undertake to perform only such duties as
are specifically set forth in this Preferred Securities Guarantee, and no
implied covenants shall be read into this Preferred Securities Guarantee
against the Preferred Guarantee Trustee. In case an Event of Default has
occurred (that has not been cured or waived pursuant to Section 2.6) and is
actually known to a Responsible Officer of the Preferred Guarantee Trustee, the
Preferred Guarantee Trustee shall exercise such of the rights and powers vested
in it by this Preferred Securities Guarantee, and use the same degree of care
and skill in its exercise thereof, as a prudent person would exercise or use
under the circumstances in the conduct of his or her own affairs.
(d) provision of this Preferred Securities
Guarantee shall be construed to relieve the Preferred Guarantee Trustee from
liability for its own negligent action, its own negligent failure to act, or
its own willful misconduct, except that:
(i) prior to the occurrence of any Event
of Default and after the curing or waiving of all such Events of Default that
may have occurred:
(A) the duties and obligations of the Preferred Guarantee
Trustee shall be determined solely by the express provisions of this Preferred
Securities Guarantee, and the Preferred Guarantee Trustee shall not be liable
except for the performance of such duties and obligations as are specifically
set forth in this Preferred Securities Guarantee, and no implied covenants or
obligations shall be read into this Preferred Securities Guarantee against the
Preferred Guarantee Trustee; and
(B) in the absence of bad faith on the part of the
Preferred Guarantee Trustee, the Preferred Guarantee Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to the Preferred
Guarantee Trustee and conforming to the requirements of this Preferred
Securities Guarantee; but in the case of any such certificates or opinions that
by any provision hereof are specifically required to be furnished to the
Preferred Guarantee Trustee, the Preferred Guarantee Trustee shall be under a
duty to examine the same to determine whether or not they conform to the
requirements of this Preferred Securities Guarantee;
(ii) the Preferred Guarantee Trustee
shall not be liable for any error of judgment made in good faith by a
Responsible Officer of the Preferred Guarantee Trustee, unless it shall be
proved that the Preferred Guarantee Trustee was negligent in ascertaining the
pertinent facts upon which such judgment was made;
(iii) the Preferred Guarantee Trustee
shall not be liable with respect to any action taken or omitted to be taken by
it in good faith in accordance with the direction of the Holders of not less
than a Majority in liquidation amount of the Preferred Securities relating to
the time, method and place of conducting any proceeding for any remedy
available to the Preferred Guarantee Trustee, or exercising any trust or power
conferred upon the Preferred Guarantee Trustee under this Preferred Securities
Guarantee; and
- 7 -
<PAGE> 11
(iv) no provision of this Preferred
Securities Guarantee shall require the Preferred Guarantee Trustee to expend or
risk its own funds or otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of its rights or
powers, if the Preferred Guarantee Trustee shall have reasonable grounds for
believing that the repayment of such funds or liability is not reasonably
assured to it under the terms of this Preferred Securities Guarantee or
indemnity, reasonably satisfactory to the Preferred Guarantee Trustee, against
such risk or liability is not reasonably assured to it.
SECTION 3.2 Certain Rights of Preferred Guarantee Trustee
(a) Subject to the provisions of Section 3.1:
(i) The Preferred Guarantee Trustee may
conclusively rely, and shall be fully protected in acting or refraining from
acting upon, any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed, sent or presented by the proper party or
parties.
(ii) Any direction or act of the
Guarantor contemplated by this Preferred Securities Guarantee shall be
sufficiently evidenced by an Officers' Certificate.
(iii) Whenever, in the administration of
this Preferred Securities Guarantee, the Preferred Guarantee Trustee shall deem
it desirable that a matter be proved or established before taking, suffering or
omitting any action hereunder, the Preferred Guarantee Trustee (unless other
evidence is herein specifically prescribed) may, in the absence of bad faith on
its part, request and conclusively rely upon an Officers' Certificate which,
upon receipt of such request, shall be promptly delivered by the Guarantor.
(iv) The Preferred Guarantee Trustee
shall have no duty to see to any recording, filing or registration of any
instrument (or any rerecording, refiling or registration thereof).
(v) The Preferred Guarantee Trustee may
consult with counsel, and the written advice or opinion of such counsel with
respect to legal matters shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in accordance with such advice or opinion. Such counsel may
be counsel to the Guarantor or any of its Affiliates and may include any of its
employees. The Preferred Guarantee Trustee shall have the right at any time to
seek instructions concerning the administration of this Preferred Securities
Guarantee from any court of competent jurisdiction.
(vi) The Preferred Guarantee Trustee
shall be under no obligation to exercise any of the rights or powers vested in
it by this Preferred Securities Guarantee at the request or direction of any
Holder, unless such Holder shall have provided to the Preferred Guarantee
Trustee such security and indemnity, reasonably satisfactory to the Preferred
Guarantee Trustee, against the costs, expenses (including attorneys' fees and
expenses
- 8 -
<PAGE> 12
and the expenses of the Preferred Guarantee Trustee's agents, nominees or
custodians) and liabilities that might be incurred by it in complying with such
request or direction, including such reasonable advances as may be requested by
the Preferred Guarantee Trustee; provided that, nothing contained in this
Section 3.2(a)(vi) shall be taken to relieve the Preferred Guarantee Trustee,
upon the occurrence of an Event of Default, of its obligation to exercise the
rights and powers vested in it by this Preferred Securities Guarantee.
(vii) The Preferred Guarantee Trustee
shall not be bound to make any investigation into the facts or matters stated
in any resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Preferred Guarantee Trustee,
in its discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit.
(viii) The Preferred Guarantee Trustee may
execute any of the trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents, nominees, custodians or attorneys, and
the Preferred Guarantee Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder.
(ix) Any action taken by the Preferred
Guarantee Trustee or its agents hereunder shall bind the Holders of the
Preferred Securities, and the signature of the Preferred Guarantee Trustee or
its agents alone shall be sufficient and effective to perform any such action.
No third party shall be required to inquire as to the authority of the
Preferred Guarantee Trustee to so act or as to its compliance with any of the
terms and provisions of this Preferred Securities Guarantee, both of which
shall be conclusively evidenced by the Preferred Guarantee Trustee's or its
agent's taking such action.
(x) Whenever in the administration of
this Preferred Securities Guarantee the Preferred Guarantee Trustee shall deem
it desirable to receive instructions with respect to enforcing any remedy or
right or taking any other action hereunder, the Preferred Guarantee Trustee (i)
may request instructions from the Holders of a Majority in liquidation amount
of the Preferred Securities, (ii) may refrain from enforcing such remedy or
right or taking such other action until such instructions are received, and
(iii) shall be protected in conclusively relying on or acting in accordance
with such instructions.
(b) No provision of this Preferred Securities
Guarantee shall be deemed to impose any duty or obligation on the Preferred
Guarantee Trustee to perform any act or acts or exercise any right, power, duty
or obligation conferred or imposed on it in any jurisdiction in which it shall
be illegal, or in which the Preferred Guarantee Trustee shall be unqualified or
incompetent in accordance with applicable law, to perform any such act or acts
or to exercise any such right, power, duty or obligation. No permissive power
or authority available to the Preferred Guarantee Trustee shall be construed to
be a duty.
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<PAGE> 13
SECTION 3.3. Not Responsible for Recitals or Issuance of Preferred
Securities Guarantee.
The recitals contained in this Preferred Securities Guarantee
shall be taken as the statements of the Guarantor, and the Preferred Guarantee
Trustee does not assume any responsibility for their correctness. The
Preferred Guarantee Trustee makes no representation as to the validity or
sufficiency of this Preferred Securities Guarantee.
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
SECTION 4.1 Preferred Guarantee Trustee; Eligibility
(a) There shall at all times be a Preferred
Guarantee Trustee which shall:
(i) not be an Affiliate of the
Guarantor; and
(ii) be a corporation organized and doing
business under the laws of the United States of America or any State or
Territory thereof or of the District of Columbia, or a corporation or Person
permitted by the Securities and Exchange Commission to act as an institutional
trustee under the Trust Indenture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least 50
million U.S. dollars ($50,000,000), and subject to supervision or examination
by Federal, State, Territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant to law
or to the requirements of the supervising or examining authority referred to
above, then, for the purposes of this Section 4.1(a)(ii), the combined capital
and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
(b) If at any time the Preferred Guarantee
Trustee shall cease to be eligible to so act under Section 4.1(a), the
Preferred Guarantee Trustee shall immediately resign in the manner and with the
effect set out in Section 4.2(c).
(c) If the Preferred Guarantee Trustee has or
shall acquire any "conflicting interest" within the meaning of Section 310(b)
of the Trust Indenture Act, the Preferred Guarantee Trustee and Guarantor shall
in all respects comply with the provisions of Section 310(b) of the Trust
Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation of Preferred
Guarantee Trustee
(a) Subject to Section 4.2(b), the Preferred
Guarantee Trustee may be appointed or removed without cause at any time by the
Guarantor.
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<PAGE> 14
(b) The Preferred Guarantee Trustee shall not be
removed in accordance with Section 4.2(a) until a Successor Preferred Guarantee
Trustee has been appointed and has accepted such appointment by written
instrument executed by such Successor Preferred Guarantee Trustee and delivered
to the Guarantor.
(c) The Preferred Guarantee Trustee appointed to
office shall hold office until a Successor Preferred Guarantee Trustee shall
have been appointed or until its removal or resignation. The Preferred
Guarantee Trustee may resign from office (without need for prior or subsequent
accounting) by an instrument in writing executed by the Preferred Guarantee
Trustee and delivered to the Guarantor, which resignation shall not take effect
until a Successor Preferred Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such Successor
Preferred Guarantee Trustee and delivered to the Guarantor and the resigning
Preferred Guarantee Trustee.
(d) If no Successor Preferred Guarantee Trustee
shall have been appointed and accepted appointment as provided in this Section
4.2 within 60 days after delivery to the Guarantor of an instrument of removal
or resignation, the resigning Preferred Guarantee Trustee may petition any
court of competent jurisdiction for appointment of a Successor Preferred
Guarantee Trustee. Such court may thereupon, after prescribing such notice, if
any, as it may deem proper, appoint a Successor Preferred Guarantee Trustee.
(e) No Preferred Guarantee Trustee shall be
liable for the acts or omissions to act of any Successor Preferred Guarantee
Trustee.
(f) Upon termination of this Preferred Securities
Guarantee or removal or resignation of the Preferred Guarantee Trustee pursuant
to this Section 4.2, the Guarantor shall pay to the Preferred Guarantee Trustee
all amounts accrued to the date of such termination, removal or resignation.
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee
The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by the Issuer), as and when due, regardless of any defense,
right of set-off or counterclaim that the Issuer may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand
The Guarantor hereby waives notice of acceptance of this
Preferred Securities Guarantee and of any liability to which it applies or may
apply, presentment, demand for payment, any right to require a proceeding first
against the Issuer or any other Person before
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<PAGE> 15
proceeding against the Guarantor, protest, notice of nonpayment, notice of
dishonor, notice of redemption and all other notices and demands.
SECTION 5.3 Obligations Not Affected
The obligations, covenants, agreements and duties of the
Guarantor under this Preferred Securities Guarantee shall in no way be affected
or impaired by reason of the happening from time to time of any of the
following:
(a) the release or waiver, by operation of law or
otherwise, of the performance or observance by the Issuer of any express or
implied agreement, covenant, term or condition relating to the Preferred
Securities to be performed or observed by the Issuer;
(b) extension of time for the payment by the
Issuer of all or any portion of the Distributions, Redemption Price,
Liquidation Distribution or any other sums payable under the terms of the
Preferred Securities or the extension of time for the performance of any other
obligation under, arising out of, or in connection with, the Preferred
Securities (other than an extension of time for payment of Distributions,
Redemption Price, Liquidation Distribution or other sum payable that results
from the extension of any interest payment period on the Debentures or any
extension of the maturity date of the Debentures permitted by the Indenture);
(c) failure, omission, delay or lack of diligence
on the part of the Holders to enforce, assert or exercise any right, privilege,
power or remedy conferred on the Holders pursuant to the terms of the Preferred
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
(d) voluntary or involuntary liquidation,
dissolution, sale of any collateral, receivership, insolvency, bankruptcy,
assignment for the benefit of creditors, reorganization, arrangement,
composition or readjustment of debt of, or other similar proceedings affecting,
the Issuer or any of the assets of the Issuer;
(e) invalidity of, or defect or deficiency in,
the Preferred Securities;
(f) settlement or compromise of any obligation
guaranteed hereby or hereby incurred; or
(g) other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or defense of a guarantor,
it being the intent of this Section 5.3 that the obligations of the Guarantor
hereunder shall be absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to,
or obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
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<PAGE> 16
SECTION 5.4 Rights of Holders
(a) Holders of a Majority in liquidation amount
of the Preferred Securities have the right to direct the time, method and place
of conducting of any proceeding for any remedy available to the Preferred
Guarantee Trustee in respect of this Preferred Securities Guarantee or
exercising any trust or power conferred upon the Preferred Guarantee Trustee
under this Preferred Securities Guarantee.
(b) the Preferred Guarantee Trustee fails to
enforce such Preferred Securities Guarantee, any Holder of Preferred Securities
may institute a legal proceeding directly against the Guarantor to enforce the
Preferred Guarantee Trustee's rights under this Preferred Securities Guarantee,
without first instituting a legal proceeding against the Issuer, the Preferred
Guarantee Trustee or any other person or entity. The Guarantor waives any
right or remedy to require that any action be brought first against the Issuer
or any other person or entity before proceeding directly against the Guarantor.
SECTION 5.5 Guarantee of Payment
This Preferred Securities Guarantee creates a guarantee of
payment and not of collection.
SECTION 5.6 Subrogation
The Guarantor shall be subrogated to all (if any) rights of
the Holders of Preferred Securities against the Issuer in respect of any
amounts paid to such Holders by the Guarantor under this Preferred Securities
Guarantee; provided, however, that the Guarantor shall not (except to the
extent required by mandatory provisions of law) be entitled to enforce or
exercise any right that it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of payment under
this Preferred Securities Guarantee, if, at the time of any such payment, any
amounts are due and unpaid under this Preferred Securities Guarantee. If any
amount shall be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders and to pay
over such amount to the Holders.
SECTION 5.7 Independent Obligations
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Preferred
Securities, and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Preferred
Securities Guarantee notwithstanding the occurrence of any event referred to in
subsections (a) through (g), inclusive, of Section 5.3 hereof.
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<PAGE> 17
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions
So long as any Preferred Securities remain outstanding, if
there shall have occurred an Event of Default or an event of default under the
Declaration, then (a) the Guarantor shall not declare or pay any dividend on,
make any distributions with respect to, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of its capital stock (other than (i)
purchases or acquisitions of shares of Common Stock in connection with the
satisfaction by the Guarantor of its obligations under any employee benefit
plans, (ii) as a result of a reclassifica- tion of the Guarantor's capital
stock or the exchange or conversion of one class or series of the Guarantor's
capital stock for another class or series of the Guarantor's capital stock or,
(iii) the purchase of fractional interests in shares of the Guarantor's capital
stock pursuant to the conversion or exchange provisions of such capital stock
of the Guarantor or the security being converted or exchanged) or make any
guarantee payments with respect to the foregoing or (b) the Guarantor shall not
make any payment of interest, principal or premium, if any, on or repay,
repurchase or redeem any debt securities (including guarantees) issued by the
Guarantor which rank pari passu with or junior to the Debentures.
SECTION 6.2 Ranking
This Preferred Securities Guarantee will constitute an
unsecured obligation of the Guarantor and will rank (i) subordinate and junior
in right of payment to all other liabilities of the Guarantor, (ii) pari passu
with the most senior preferred or preference stock now or hereafter issued by
the Guarantor and with any guarantee now or hereafter entered into by the
Guarantor in respect of any Preferred or preference stock of any Affiliate of
the Guarantor, and (iii) senior to the Guarantor's common stock.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination
This Preferred Securities Guarantee shall terminate upon (i)
full payment of the Redemption Price of all Preferred Securities, (ii) upon the
distribution of the Debentures to the Holders of all of the Preferred
Securities or (iii) upon full payment of the amounts payable in accordance with
the Declaration upon liquidation of the Issuer. Notwithstanding the foregoing,
this Preferred Securities Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder of Preferred
Securities must restore payment of any sums paid under the Preferred Securities
or under this Preferred Securities Guarantee.
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<PAGE> 18
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation
(a) Indemnified Person shall be liable,
responsible or accountable in damages or otherwise to the Guarantor or any
Covered Person for any loss, damage or claim incurred by reason of any act or
omission performed or omitted by such Indemnified Person in good faith in
accordance with this Preferred Securities Guarantee and in a manner that such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Preferred Securities Guarantee or
by law, except that an Indemnified Person shall be liable for any such loss,
damage or claim incurred by reason of such Indemnified Person's negligence or
willful misconduct with respect to such acts or omissions.
(b) Indemnified Person shall be fully protected
in relying in good faith upon the records of the Guarantor and upon such
information, opinions, reports or statements presented to the Guarantor by any
Person as to matters the Indemnified Person reasonably believes are within such
other Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Guarantor, including information,
opinions, reports or statements as to the value and amount of the assets,
liabilities, profits, losses, or any other facts pertinent to the existence and
amount of assets from which Distributions to Holders of Preferred Securities
might properly be paid.
SECTION 8.2 Indemnification
The Guarantor agrees to indemnify each Indemnified Person for,
and to hold each Indemnified Person harmless against, any loss, liability or
expense incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees
and expenses) of defending itself against, or investigating, any claim or
liability in connection with the exercise or performance of any of its powers
or duties hereunder. The obligation to indemnify as set forth in this Section
8.2 shall survive the termination of this Preferred Securities Guarantee.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns
All guarantees and agreements contained in this Preferred
Securities Guarantee shall bind the successors, assigns, receivers, trustees
and representatives of the Guarantor and shall inure to the benefit of the
Holders of the Preferred Securities then outstanding.
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<PAGE> 19
SECTION 9.2 Amendments
Except with respect to any changes that do not adversely
affect the rights of Holders (in which case no consent of Holders will be
required), this Preferred Securities Guarantee may only be amended with the
prior approval of the Holders of at least a Majority in liquidation amount
(including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accrued and unpaid Distributions to the date upon which the
voting percentages are determined) of all the outstanding Preferred Securities.
The provisions of Section 12.2 of the Declaration with respect to meetings of
Holders of the Securities apply to the giving of such approval.
SECTION 9.3 Notices
All notices provided for in this Preferred Securities
Guarantee shall be in writing, duly signed by the party giving such notice, and
shall be delivered, telecopied or mailed by registered or certified mail, as
follows:
(a) given to the Preferred Guarantee Trustee, at
the Preferred Guarantee Trustee's mailing address set forth below (or such
other address as the Preferred Guarantee Trustee may give notice of to the
Holders of the Preferred Securities):
The Bank of New York 101 Barclay Street, 21 West New York, New
York 10286 Attention: Corporate Trust Trustee Administration
(b) given to the Guarantor, at the Guarantor's
mailing address set forth below (or such other address as the Guarantor may
give notice of to the Holders of the Preferred Securities):
Phillips Petroleum Company Phillips Building Bartlesville,
Oklahoma 74004 Attention:
(c) given to any Holder of Preferred Securities,
at the address set forth on the books and records of the Issuer.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 9.4 Benefit
This Preferred Securities Guarantee is solely for the benefit
of the Holders of the Preferred Securities and, subject to Section 3.1(a), is
not separately transferable from the Preferred Securities.
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<PAGE> 20
SECTION 9.5 Governing Law
THIS PREFERRED SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
THIS PREFERRED SECURITIES GUARANTEE is executed as of the day
and year first above written.
PHILLIPS PETROLEUM COMPANY,
as Guarantor
By:
------------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Preferred Guarantee Trustee
By:
------------------------------
Name:
Title:
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<PAGE> 1
EXHIBIT 4-V
========================================
PREFERRED SECURITIES GUARANTEE AGREEMENT
Phillips 66 Capital VI
Dated as of _______ __, 1998
========================================
<PAGE> 2
PREFERRED SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Preferred Securities
Guarantee"), dated as of _______ __, 1998, is executed and delivered by
Phillips Petroleum Company, a Delaware corporation (the "Guarantor"), and The
Bank of New York, a New York banking corporation, as trustee (the "Preferred
Guarantee Trustee"), for the benefit of the Holders (as defined herein) from
time to time of the Preferred Securities (as defined herein) of Phillips 66
Capital VI, a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of
Trust (the "Declaration"), dated as of ________, 1998, among the trustees of
the Issuer named therein, the Guarantor, as sponsor, and the holders from time
to time of undivided beneficial interests in the assets of the Issuer, the
Issuer is issuing on the date hereof [ ] preferred securities, having an
aggregate liquidation amount of $[ ] (plus up to an additional [ ] preferred
securities, having an aggregate liquidation amount of $[ ], to cover
over-allotments)], designated the _____% Trust Originated Preferred Securities
(the "Preferred Securities");
WHEREAS, as incentive for the Holders to purchase the
Preferred Securities, the Guarantor desires irrevocably and unconditionally to
agree, to the extent set forth in this Preferred Securities Guarantee, to pay
to the Holders of the Preferred Securities the Guarantee Payments (as defined
herein) and to make certain other payments on the terms and conditions set
forth herein.
WHEREAS, the Guarantor is also executing and delivering a
guarantee agreement (the "Common Securities Guarantee") in substantially
identical terms to this Preferred Securities Guarantee for the benefit of the
holders of the Common Securities (as defined herein), except that if an Event
of Default (as defined in the Indenture), has occurred and is continuing, the
rights of holders of the Common Securities to receive Guarantee Payments under
the Common Securities Guarantee are subordinated to the rights of Holders of
Preferred Securities to receive Guarantee Payments under this Preferred
Securities Guarantee.
NOW, THEREFORE, in consideration of the purchase by each
Holder of Preferred Securities, which purchase the Guarantor hereby agrees
shall benefit the Guarantor, the Guarantor executes and delivers this Preferred
Securities Guarantee for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this Preferred Securities Guarantee, unless the context
otherwise requires:
<PAGE> 3
(a) Capitalized terms used in this Preferred
Securities Guarantee but not defined in the preamble above have the respective
meanings assigned to them in this Section 1.1;
(b) a term defined anywhere in this Preferred
Securities Guarantee has the same meaning throughout;
(c) all references to "the Preferred Securities
Guarantee" or "this Preferred Securities Guarantee" are to this Preferred
Securities Guarantee as modified, supplemented or amended from time to time;
(d) all references in this Preferred Securities
Guarantee to Articles and Sections are to Articles and Sections of this
Preferred Securities Guarantee, unless otherwise specified;
(e) a term defined in the Trust Indenture Act has
the same meaning when used in this Preferred Securities Guarantee, unless
otherwise defined in this Preferred Securities Guarantee or unless the context
otherwise requires; and
(f) a reference to the singular includes the
plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act of 1933, as amended, or any successor rule
thereunder.
"Business Day" means any day other than a day on which banking
institutions in the City of New York, New York are authorized or required by
any applicable law to close.
"Common Securities" means the securities representing common
undivided beneficial interests in the assets of the Issuer.
"Corporate Trust Office" means the office of the Preferred
Guarantee Trustee at which the corporate trust business of the Preferred
Guarantee Trustee shall, at any particular time, be principally administered,
which office at the date of execution of this Agreement is located at 101
Barclay Street, 21 West, New York, New York 10286.
"Covered Person" means any Holder or beneficial owner of
Preferred Securities.
"Debentures" means the series of junior subordinated debt
securities of the Guarantor designated the ___% [Junior Subordinated Deferrable
Interest Debentures] due [ ] held by the Institutional Trustee (as defined
in the Declaration) of the Issuer.
"Event of Default" means a default by the Guarantor on any of
its payment or other obligations under this Preferred Securities Guarantee.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Preferred Securities,
to the extent not paid or made by the Issuer:
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<PAGE> 4
(i) any accrued and unpaid Distributions (as defined in the Declaration) that
are required to be paid on such Preferred Securities to the extent the Issuer
shall have funds available therefor, (ii) the redemption price, including all
accrued and unpaid Distributions to the date of redemption (the "Redemption
Price") to the extent the Issuer has funds available therefor, with respect to
any Preferred Securities called for redemption by the Issuer, and (iii) upon a
voluntary or involuntary dissolution, winding-up or termination of the Issuer
(other than in connection with the distribution of Debentures to the Holders in
exchange for Preferred Securities as provided in the Declaration), the lesser
of (a) the aggregate of the liquidation amount and all accrued and unpaid
Distributions on the Preferred Securities to the date of payment, to the extent
the Issuer shall have funds available therefor, and (b) the amount of assets of
the Issuer remaining available for distribution to Holders in liquidation of
the Issuer (in either case, the "Liquidation Distribution"). If an event of
default under the Indenture has occurred and is continuing, the rights of
holders of the Common Securities to receive payments under the Common
Securities Guarantee Agreement are subordinated to the rights of Holders of
Preferred Securities to receive Guarantee Payments.
"Holder" shall mean any holder, as registered on the books and
records of the Issuer of any Preferred Securities; provided, however, that, in
determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder,
"Holder" shall not include the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Preferred Guarantee Trustee,
any Affiliate of the Preferred Guarantee Trustee, or any officers, directors,
shareholders, members, partners, employees, representatives, nominees,
custodians or agents of the Preferred Guarantee Trustee.
"Indenture" means the Indenture dated as of _______, 1998,
among the Guarantor (the "Debenture Issuer") and The Bank of New York, N.A., as
trustee, and any indenture supplemental thereto pursuant to which certain
subordinated debt securities of the Debenture Issuer are to be issued to the
Property Trustee of the Issuer.
"Majority in liquidation amount of the Securities" means,
except as provided by the Trust Indenture Act, a vote by Holder(s) of Preferred
Securities, voting separately as a class, of more than 50% of the liquidation
amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accrued and unpaid Distributions to the date
upon which the voting percentages are determined) of all Preferred Securities.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Preferred Securities Guarantee shall include:
(a) a statement that each officer signing the
Officers' Certificate has read the covenant or condition and the definition
relating thereto;
(b) a brief statement of the nature and scope of
the examination or investigation undertaken by each officer in rendering the
Officers' Certificate;
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<PAGE> 5
(c) a statement that each such officer has made
such examination or investigation as, in such officer's opinion, is necessary
to enable such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of
each such officer, such condition or covenant has been complied with.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Preferred Guarantee Trustee" means The Bank of New York, a
New York banking corporation, until a Successor Preferred Guarantee Trustee has
been appointed and has accepted such appointment pursuant to the terms of this
Preferred Securities Guarantee and thereafter means each such Successor
Preferred Guarantee Trustee.
"Responsible Officer" means, with respect to the Preferred
Guarantee Trustee, any officer within the Corporate Trust Office of the
Preferred Guarantee Trustee, including any vice president, any assistant vice
president, any assistant secretary, the treasurer, any assistant treasurer or
other officer of the Corporate Trust Office of the Preferred Guarantee Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate
trust matter, any other officer to whom such matter is referred because of that
officer's knowledge of and familiarity with the particular subject.
"Successor Preferred Guarantee Trustee" means a successor
Preferred Guarantee Trustee possessing the qualifications to act as Preferred
Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended.
"Trust Securities" means the Common Securities and the
Preferred Securities.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
(a) This Preferred Securities Guarantee is
subject to the provisions of the Trust Indenture Act that are required to be
part of this Preferred Securities Guarantee and shall, to the extent
applicable, be governed by such provisions; and
(b) if and to the extent that any provision of
this Preferred Securities Guarantee limits, qualifies or conflicts with the
duties imposed by Section 310 to 317, inclusive, of the Trust Indenture Act,
such imposed duties shall control.
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<PAGE> 6
SECTION 2.2 Lists of Holders of Securities
(a) The Guarantor shall provide the Preferred
Guarantee Trustee with a list, in such form as the Preferred Guarantee Trustee
may reasonably require, of the names and addresses of the Holders of the
Preferred Securities ("List of Holders") as of such date, (i) within 1 Business
Day after January 1 and June 30 of each year, and (ii) at any other time within
30 days of receipt by the Guarantor of a written request for a List of Holders
as of a date no more than 14 days before such List of Holders is given to the
Preferred Guarantee Trustee provided, that the Guarantor shall not be obligated
to provide such List of Holders at any time the List of Holders does not differ
from the most recent List of Holders given to the Preferred Guarantee Trustee
by the Guarantor. The Preferred Guarantee Trustee may destroy any List of
Holders previously given to it on receipt of a new List of Holders.
(b) The Preferred Guarantee Trustee shall comply
with its obligations under Sections 311(a), 311(b) and Section 312(b) of the
Trust Indenture Act.
SECTION 2.3 Reports by the Preferred Guarantee Trustee
Within 60 days after May 15 of each year, the Preferred
Guarantee Trustee shall provide to the Holders of the Preferred Securities such
reports as are required by Section 313 of the Trust Indenture Act, if any, in
the form and in the manner provided by Section 313 of the Trust Indenture Act.
The Preferred Guarantee Trustee shall also comply with the requirements of
Section 313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Preferred Guarantee Trustee
The Guarantor shall provide to the Preferred Guarantee Trustee
such documents, reports and information as required by Section 314 (if any) and
the compliance certificate required by Section 314 of the Trust Indenture Act
in the form, in the manner and at the times required by Section 314 of the
Trust Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent
The Guarantor shall provide to the Preferred Guarantee Trustee
such evidence of compliance with any conditions precedent, if any, provided for
in this Preferred Securities Guarantee that relate to any of the matters set
forth in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) may be given
in the form of an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver
The Holders of a Majority in liquidation amount of Preferred
Securities may, by vote, on behalf of the Holders of all of the Preferred
Securities, waive any past Event of Default and its consequences. Upon such
waiver, any such Event of Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this
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<PAGE> 7
Preferred Securities Guarantee, but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.
SECTION 2.7 Event of Default; Notice
(a) The Preferred Guarantee Trustee shall, within
90 days after the occurrence of an Event of Default, transmit by mail, first
class postage prepaid, to the Holders of the Preferred Securities, notices of
all Events of Default actually known to a Responsible Officer of the Preferred
Guarantee Trustee, unless such defaults have been cured before the giving of
such notice, provided, that, the Preferred Guarantee Trustee shall be protected
in withholding such notice if and so long as a Responsible Officer of the
Preferred Guarantee Trustee in good faith determines that the withholding of
such notice is in the interests of the Holders of the Preferred Securities.
(b) The Preferred Guarantee Trustee shall not be
deemed to have knowledge of any Event of Default unless the Preferred Guarantee
Trustee shall have received written notice, or of which a Responsible Officer
of the Preferred Guarantee Trustee charged with the administration of the
Declaration shall have obtained actual knowledge.
SECTION 2.8 Conflicting Interests
The Declaration shall be deemed to be specifically described
in this Preferred Securities Guarantee for the purposes of clause (i) of the
first proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Preferred Guarantee Trustee
(a) This Preferred Securities Guarantee shall be
held by the Preferred Guarantee Trustee for the benefit of the Holders of the
Preferred Securities, and the Preferred Guarantee Trustee shall not transfer
this Preferred Securities Guarantee to any Person except a Holder of Preferred
Securities exercising his or her rights pursuant to Section 5.4(b) or to a
Successor Preferred Guarantee Trustee on acceptance by such Successor Preferred
Guarantee Trustee of its appointment to act as Successor Preferred Guarantee
Trustee. The right, title and interest of the Preferred Guarantee Trustee
shall automatically vest in any Successor Preferred Guarantee Trustee, and such
vesting and cessation of title shall be effective whether or not conveyancing
documents have been executed and delivered pursuant to the appointment of such
Successor Preferred Guarantee Trustee.
(b) If an Event of Default actually known to a
Responsible Officer of the Preferred Guarantee Trustee has occurred and is
continuing, the Preferred Guarantee Trustee shall enforce this Preferred
Securities Guarantee for the benefit of the Holders of the Preferred
Securities.
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<PAGE> 8
(c) Preferred Guarantee Trustee, before the
occurrence of any Event of Default and after the curing of all Events of
Default that may have occurred, shall undertake to perform only such duties as
are specifically set forth in this Preferred Securities Guarantee, and no
implied covenants shall be read into this Preferred Securities Guarantee
against the Preferred Guarantee Trustee. In case an Event of Default has
occurred (that has not been cured or waived pursuant to Section 2.6) and is
actually known to a Responsible Officer of the Preferred Guarantee Trustee, the
Preferred Guarantee Trustee shall exercise such of the rights and powers vested
in it by this Preferred Securities Guarantee, and use the same degree of care
and skill in its exercise thereof, as a prudent person would exercise or use
under the circumstances in the conduct of his or her own affairs.
(d) provision of this Preferred Securities
Guarantee shall be construed to relieve the Preferred Guarantee Trustee from
liability for its own negligent action, its own negligent failure to act, or
its own willful misconduct, except that:
(i) prior to the occurrence of any Event
of Default and after the curing or waiving of all such Events of Default that
may have occurred:
(A) the duties and obligations of the Preferred Guarantee
Trustee shall be determined solely by the express provisions of this Preferred
Securities Guarantee, and the Preferred Guarantee Trustee shall not be liable
except for the performance of such duties and obligations as are specifically
set forth in this Preferred Securities Guarantee, and no implied covenants or
obligations shall be read into this Preferred Securities Guarantee against the
Preferred Guarantee Trustee; and
(B) in the absence of bad faith on the part of the
Preferred Guarantee Trustee, the Preferred Guarantee Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to the Preferred
Guarantee Trustee and conforming to the requirements of this Preferred
Securities Guarantee; but in the case of any such certificates or opinions that
by any provision hereof are specifically required to be furnished to the
Preferred Guarantee Trustee, the Preferred Guarantee Trustee shall be under a
duty to examine the same to determine whether or not they conform to the
requirements of this Preferred Securities Guarantee;
(ii) the Preferred Guarantee Trustee
shall not be liable for any error of judgment made in good faith by a
Responsible Officer of the Preferred Guarantee Trustee, unless it shall be
proved that the Preferred Guarantee Trustee was negligent in ascertaining the
pertinent facts upon which such judgment was made;
(iii) the Preferred Guarantee Trustee
shall not be liable with respect to any action taken or omitted to be taken by
it in good faith in accordance with the direction of the Holders of not less
than a Majority in liquidation amount of the Preferred Securities relating to
the time, method and place of conducting any proceeding for any remedy
available to the Preferred Guarantee Trustee, or exercising any trust or power
conferred upon the Preferred Guarantee Trustee under this Preferred Securities
Guarantee; and
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<PAGE> 9
(iv) no provision of this Preferred
Securities Guarantee shall require the Preferred Guarantee Trustee to expend or
risk its own funds or otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of its rights or
powers, if the Preferred Guarantee Trustee shall have reasonable grounds for
believing that the repayment of such funds or liability is not reasonably
assured to it under the terms of this Preferred Securities Guarantee or
indemnity, reasonably satisfactory to the Preferred Guarantee Trustee, against
such risk or liability is not reasonably assured to it.
SECTION 3.2 Certain Rights of Preferred Guarantee Trustee
(a) Subject to the provisions of Section 3.1:
(i) The Preferred Guarantee Trustee may
conclusively rely, and shall be fully protected in acting or refraining from
acting upon, any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed, sent or presented by the proper party or
parties.
(ii) Any direction or act of the
Guarantor contemplated by this Preferred Securities Guarantee shall be
sufficiently evidenced by an Officers' Certificate.
(iii) Whenever, in the administration of
this Preferred Securities Guarantee, the Preferred Guarantee Trustee shall deem
it desirable that a matter be proved or established before taking, suffering or
omitting any action hereunder, the Preferred Guarantee Trustee (unless other
evidence is herein specifically prescribed) may, in the absence of bad faith on
its part, request and conclusively rely upon an Officers' Certificate which,
upon receipt of such request, shall be promptly delivered by the Guarantor.
(iv) The Preferred Guarantee Trustee
shall have no duty to see to any recording, filing or registration of any
instrument (or any rerecording, refiling or registration thereof).
(v) The Preferred Guarantee Trustee may
consult with counsel, and the written advice or opinion of such counsel with
respect to legal matters shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in accordance with such advice or opinion. Such counsel may
be counsel to the Guarantor or any of its Affiliates and may include any of its
employees. The Preferred Guarantee Trustee shall have the right at any time to
seek instructions concerning the administration of this Preferred Securities
Guarantee from any court of competent jurisdiction.
(vi) The Preferred Guarantee Trustee
shall be under no obligation to exercise any of the rights or powers vested in
it by this Preferred Securities Guarantee at the request or direction of any
Holder, unless such Holder shall have provided to the Preferred Guarantee
Trustee such security and indemnity, reasonably satisfactory to the Preferred
Guarantee Trustee, against the costs, expenses (including attorneys' fees and
expenses
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<PAGE> 10
and the expenses of the Preferred Guarantee Trustee's agents, nominees or
custodians) and liabilities that might be incurred by it in complying with such
request or direction, including such reasonable advances as may be requested by
the Preferred Guarantee Trustee; provided that, nothing contained in this
Section 3.2(a)(vi) shall be taken to relieve the Preferred Guarantee Trustee,
upon the occurrence of an Event of Default, of its obligation to exercise the
rights and powers vested in it by this Preferred Securities Guarantee.
(vii) The Preferred Guarantee Trustee
shall not be bound to make any investigation into the facts or matters stated
in any resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Preferred Guarantee Trustee,
in its discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit.
(viii) The Preferred Guarantee Trustee may
execute any of the trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents, nominees, custodians or attorneys, and
the Preferred Guarantee Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder.
(ix) Any action taken by the Preferred
Guarantee Trustee or its agents hereunder shall bind the Holders of the
Preferred Securities, and the signature of the Preferred Guarantee Trustee or
its agents alone shall be sufficient and effective to perform any such action.
No third party shall be required to inquire as to the authority of the
Preferred Guarantee Trustee to so act or as to its compliance with any of the
terms and provisions of this Preferred Securities Guarantee, both of which
shall be conclusively evidenced by the Preferred Guarantee Trustee's or its
agent's taking such action.
(x) Whenever in the administration of
this Preferred Securities Guarantee the Preferred Guarantee Trustee shall deem
it desirable to receive instructions with respect to enforcing any remedy or
right or taking any other action hereunder, the Preferred Guarantee Trustee (i)
may request instructions from the Holders of a Majority in liquidation amount
of the Preferred Securities, (ii) may refrain from enforcing such remedy or
right or taking such other action until such instructions are received, and
(iii) shall be protected in conclusively relying on or acting in accordance
with such instructions.
(b) No provision of this Preferred Securities
Guarantee shall be deemed to impose any duty or obligation on the Preferred
Guarantee Trustee to perform any act or acts or exercise any right, power, duty
or obligation conferred or imposed on it in any jurisdiction in which it shall
be illegal, or in which the Preferred Guarantee Trustee shall be unqualified or
incompetent in accordance with applicable law, to perform any such act or acts
or to exercise any such right, power, duty or obligation. No permissive power
or authority available to the Preferred Guarantee Trustee shall be construed to
be a duty.
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<PAGE> 11
SECTION 3.3. Not Responsible for Recitals or Issuance of Preferred
Securities Guarantee.
The recitals contained in this Preferred Securities Guarantee
shall be taken as the statements of the Guarantor, and the Preferred Guarantee
Trustee does not assume any responsibility for their correctness. The
Preferred Guarantee Trustee makes no representation as to the validity or
sufficiency of this Preferred Securities Guarantee.
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
SECTION 4.1 Preferred Guarantee Trustee; Eligibility
(a) There shall at all times be a Preferred
Guarantee Trustee which shall:
(i) not be an Affiliate of the
Guarantor; and
(ii) be a corporation organized and doing
business under the laws of the United States of America or any State or
Territory thereof or of the District of Columbia, or a corporation or Person
permitted by the Securities and Exchange Commission to act as an institutional
trustee under the Trust Indenture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least 50
million U.S. dollars ($50,000,000), and subject to supervision or examination
by Federal, State, Territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant to law
or to the requirements of the supervising or examining authority referred to
above, then, for the purposes of this Section 4.1(a)(ii), the combined capital
and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
(b) If at any time the Preferred Guarantee
Trustee shall cease to be eligible to so act under Section 4.1(a), the
Preferred Guarantee Trustee shall immediately resign in the manner and with the
effect set out in Section 4.2(c).
(c) If the Preferred Guarantee Trustee has or
shall acquire any "conflicting interest" within the meaning of Section 310(b)
of the Trust Indenture Act, the Preferred Guarantee Trustee and Guarantor shall
in all respects comply with the provisions of Section 310(b) of the Trust
Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation of Preferred
Guarantee Trustee
(a) Subject to Section 4.2(b), the Preferred
Guarantee Trustee may be appointed or removed without cause at any time by the
Guarantor.
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<PAGE> 12
(b) The Preferred Guarantee Trustee shall not be
removed in accordance with Section 4.2(a) until a Successor Preferred Guarantee
Trustee has been appointed and has accepted such appointment by written
instrument executed by such Successor Preferred Guarantee Trustee and delivered
to the Guarantor.
(c) The Preferred Guarantee Trustee appointed to
office shall hold office until a Successor Preferred Guarantee Trustee shall
have been appointed or until its removal or resignation. The Preferred
Guarantee Trustee may resign from office (without need for prior or subsequent
accounting) by an instrument in writing executed by the Preferred Guarantee
Trustee and delivered to the Guarantor, which resignation shall not take effect
until a Successor Preferred Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such Successor
Preferred Guarantee Trustee and delivered to the Guarantor and the resigning
Preferred Guarantee Trustee.
(d) If no Successor Preferred Guarantee Trustee
shall have been appointed and accepted appointment as provided in this Section
4.2 within 60 days after delivery to the Guarantor of an instrument of removal
or resignation, the resigning Preferred Guarantee Trustee may petition any
court of competent jurisdiction for appointment of a Successor Preferred
Guarantee Trustee. Such court may thereupon, after prescribing such notice, if
any, as it may deem proper, appoint a Successor Preferred Guarantee Trustee.
(e) No Preferred Guarantee Trustee shall be
liable for the acts or omissions to act of any Successor Preferred Guarantee
Trustee.
(f) Upon termination of this Preferred Securities
Guarantee or removal or resignation of the Preferred Guarantee Trustee pursuant
to this Section 4.2, the Guarantor shall pay to the Preferred Guarantee Trustee
all amounts accrued to the date of such termination, removal or resignation.
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee
The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by the Issuer), as and when due, regardless of any defense,
right of set-off or counterclaim that the Issuer may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand
The Guarantor hereby waives notice of acceptance of this
Preferred Securities Guarantee and of any liability to which it applies or may
apply, presentment, demand for payment, any right to require a proceeding first
against the Issuer or any other Person before
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<PAGE> 13
proceeding against the Guarantor, protest, notice of nonpayment, notice of
dishonor, notice of redemption and all other notices and demands.
SECTION 5.3 Obligations Not Affected
The obligations, covenants, agreements and duties of the
Guarantor under this Preferred Securities Guarantee shall in no way be affected
or impaired by reason of the happening from time to time of any of the
following:
(a) the release or waiver, by operation of law or
otherwise, of the performance or observance by the Issuer of any express or
implied agreement, covenant, term or condition relating to the Preferred
Securities to be performed or observed by the Issuer;
(b) extension of time for the payment by the
Issuer of all or any portion of the Distributions, Redemption Price,
Liquidation Distribution or any other sums payable under the terms of the
Preferred Securities or the extension of time for the performance of any other
obligation under, arising out of, or in connection with, the Preferred
Securities (other than an extension of time for payment of Distributions,
Redemption Price, Liquidation Distribution or other sum payable that results
from the extension of any interest payment period on the Debentures or any
extension of the maturity date of the Debentures permitted by the Indenture);
(c) failure, omission, delay or lack of diligence
on the part of the Holders to enforce, assert or exercise any right, privilege,
power or remedy conferred on the Holders pursuant to the terms of the Preferred
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
(d) voluntary or involuntary liquidation,
dissolution, sale of any collateral, receivership, insolvency, bankruptcy,
assignment for the benefit of creditors, reorganization, arrangement,
composition or readjustment of debt of, or other similar proceedings affecting,
the Issuer or any of the assets of the Issuer;
(e) invalidity of, or defect or deficiency in,
the Preferred Securities;
(f) settlement or compromise of any obligation
guaranteed hereby or hereby incurred; or
(g) other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or defense of a guarantor,
it being the intent of this Section 5.3 that the obligations of the Guarantor
hereunder shall be absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to,
or obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
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SECTION 5.4 Rights of Holders
(a) Holders of a Majority in liquidation amount
of the Preferred Securities have the right to direct the time, method and place
of conducting of any proceeding for any remedy available to the Preferred
Guarantee Trustee in respect of this Preferred Securities Guarantee or
exercising any trust or power conferred upon the Preferred Guarantee Trustee
under this Preferred Securities Guarantee.
(b) the Preferred Guarantee Trustee fails to
enforce such Preferred Securities Guarantee, any Holder of Preferred Securities
may institute a legal proceeding directly against the Guarantor to enforce the
Preferred Guarantee Trustee's rights under this Preferred Securities Guarantee,
without first instituting a legal proceeding against the Issuer, the Preferred
Guarantee Trustee or any other person or entity. The Guarantor waives any
right or remedy to require that any action be brought first against the Issuer
or any other person or entity before proceeding directly against the Guarantor.
SECTION 5.5 Guarantee of Payment
This Preferred Securities Guarantee creates a guarantee of
payment and not of collection.
SECTION 5.6 Subrogation
The Guarantor shall be subrogated to all (if any) rights of
the Holders of Preferred Securities against the Issuer in respect of any
amounts paid to such Holders by the Guarantor under this Preferred Securities
Guarantee; provided, however, that the Guarantor shall not (except to the
extent required by mandatory provisions of law) be entitled to enforce or
exercise any right that it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of payment under
this Preferred Securities Guarantee, if, at the time of any such payment, any
amounts are due and unpaid under this Preferred Securities Guarantee. If any
amount shall be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders and to pay
over such amount to the Holders.
SECTION 5.7 Independent Obligations
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Preferred
Securities, and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Preferred
Securities Guarantee notwithstanding the occurrence of any event referred to in
subsections (a) through (g), inclusive, of Section 5.3 hereof.
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ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions
So long as any Preferred Securities remain outstanding, if
there shall have occurred an Event of Default or an event of default under the
Declaration, then (a) the Guarantor shall not declare or pay any dividend on,
make any distributions with respect to, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of its capital stock (other than (i)
purchases or acquisitions of shares of Common Stock in connection with the
satisfaction by the Guarantor of its obligations under any employee benefit
plans, (ii) as a result of a reclassifica- tion of the Guarantor's capital
stock or the exchange or conversion of one class or series of the Guarantor's
capital stock for another class or series of the Guarantor's capital stock or,
(iii) the purchase of fractional interests in shares of the Guarantor's capital
stock pursuant to the conversion or exchange provisions of such capital stock
of the Guarantor or the security being converted or exchanged) or make any
guarantee payments with respect to the foregoing or (b) the Guarantor shall not
make any payment of interest, principal or premium, if any, on or repay,
repurchase or redeem any debt securities (including guarantees) issued by the
Guarantor which rank pari passu with or junior to the Debentures.
SECTION 6.2 Ranking
This Preferred Securities Guarantee will constitute an
unsecured obligation of the Guarantor and will rank (i) subordinate and junior
in right of payment to all other liabilities of the Guarantor, (ii) pari passu
with the most senior preferred or preference stock now or hereafter issued by
the Guarantor and with any guarantee now or hereafter entered into by the
Guarantor in respect of any Preferred or preference stock of any Affiliate of
the Guarantor, and (iii) senior to the Guarantor's common stock.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination
This Preferred Securities Guarantee shall terminate upon (i)
full payment of the Redemption Price of all Preferred Securities, (ii) upon the
distribution of the Debentures to the Holders of all of the Preferred
Securities or (iii) upon full payment of the amounts payable in accordance with
the Declaration upon liquidation of the Issuer. Notwithstanding the foregoing,
this Preferred Securities Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder of Preferred
Securities must restore payment of any sums paid under the Preferred Securities
or under this Preferred Securities Guarantee.
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<PAGE> 16
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation
(a) Indemnified Person shall be liable,
responsible or accountable in damages or otherwise to the Guarantor or any
Covered Person for any loss, damage or claim incurred by reason of any act or
omission performed or omitted by such Indemnified Person in good faith in
accordance with this Preferred Securities Guarantee and in a manner that such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Preferred Securities Guarantee or
by law, except that an Indemnified Person shall be liable for any such loss,
damage or claim incurred by reason of such Indemnified Person's negligence or
willful misconduct with respect to such acts or omissions.
(b) Indemnified Person shall be fully protected
in relying in good faith upon the records of the Guarantor and upon such
information, opinions, reports or statements presented to the Guarantor by any
Person as to matters the Indemnified Person reasonably believes are within such
other Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Guarantor, including information,
opinions, reports or statements as to the value and amount of the assets,
liabilities, profits, losses, or any other facts pertinent to the existence and
amount of assets from which Distributions to Holders of Preferred Securities
might properly be paid.
SECTION 8.2 Indemnification
The Guarantor agrees to indemnify each Indemnified Person for,
and to hold each Indemnified Person harmless against, any loss, liability or
expense incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees
and expenses) of defending itself against, or investigating, any claim or
liability in connection with the exercise or performance of any of its powers
or duties hereunder. The obligation to indemnify as set forth in this Section
8.2 shall survive the termination of this Preferred Securities Guarantee.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns
All guarantees and agreements contained in this Preferred
Securities Guarantee shall bind the successors, assigns, receivers, trustees
and representatives of the Guarantor and shall inure to the benefit of the
Holders of the Preferred Securities then outstanding.
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<PAGE> 17
SECTION 9.2 Amendments
Except with respect to any changes that do not adversely
affect the rights of Holders (in which case no consent of Holders will be
required), this Preferred Securities Guarantee may only be amended with the
prior approval of the Holders of at least a Majority in liquidation amount
(including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accrued and unpaid Distributions to the date upon which the
voting percentages are determined) of all the outstanding Preferred Securities.
The provisions of Section 12.2 of the Declaration with respect to meetings of
Holders of the Securities apply to the giving of such approval.
SECTION 9.3 Notices
All notices provided for in this Preferred Securities
Guarantee shall be in writing, duly signed by the party giving such notice, and
shall be delivered, telecopied or mailed by registered or certified mail, as
follows:
(a) given to the Preferred Guarantee Trustee, at
the Preferred Guarantee Trustee's mailing address set forth below (or such
other address as the Preferred Guarantee Trustee may give notice of to the
Holders of the Preferred Securities):
The Bank of New York 101 Barclay Street, 21 West New York, New
York 10286 Attention: Corporate Trust Trustee Administration
(b) given to the Guarantor, at the Guarantor's
mailing address set forth below (or such other address as the Guarantor may
give notice of to the Holders of the Preferred Securities):
Phillips Petroleum Company Phillips Building Bartlesville,
Oklahoma 74004 Attention:
(c) given to any Holder of Preferred Securities,
at the address set forth on the books and records of the Issuer.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 9.4 Benefit
This Preferred Securities Guarantee is solely for the benefit
of the Holders of the Preferred Securities and, subject to Section 3.1(a), is
not separately transferable from the Preferred Securities.
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<PAGE> 18
SECTION 9.5 Governing Law
THIS PREFERRED SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
THIS PREFERRED SECURITIES GUARANTEE is executed as of the day
and year first above written.
PHILLIPS PETROLEUM COMPANY,
as Guarantor
By:
---------------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Preferred Guarantee Trustee
By:
---------------------------------
Name:
Title:
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<PAGE> 1
EXHIBIT 5-A
May 22, 1998
Phillips Petroleum Company
Phillips Building
Bartlesville, Oklahoma 74004
Ladies and Gentlemen:
I have acted as counsel for Phillips Petroleum Company, a
Delaware corporation ("Phillips" or the "Company") and have represented the
Company, and Phillips 66 Capital III, Phillips 66 Capital IV, Phillips 66
Capital V and Phillips 66 Capital VI, each a statutory business trust created
under the Business Trust Act of the State of Delaware (each a "Trust" and
collectively, the "Trusts"), in connection with the preparation and filing with
the Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "Act"), of a Registration Statement on Form S-3
(the "Registration Statement"), relating to registration under the Act of (i)
senior debt securities, and subordinated debt securities of Phillips (the "Debt
Securities"), which may be issued pursuant to a Senior Indenture dated as of
September 15, 1990, as supplemented by Supplemental Indenture No. 1 dated as of
May 23, 1991 between Phillips and U.S. Bank Trust National Association, as
successor to Continental Bank,
<PAGE> 2
Phillips Petroleum Company -2- May 22, 1998
National Association (the "Senior Debt Trustee"), as trustee (as amended or
supplemented, the "Senior Debt Indenture"), a Subordinated Debt Indenture dated
as of May 23, 1996 between Phillips and The Bank of New York (the "Subordinated
Debt Trustee" and, together with the Senior Debt Trustee, the "Trustee"), as
trustee (as amended or supplemented, the "Subordinated Debt Indenture" and,
together with the Senior Indenture, the "Indenture"), (ii) shares of preferred
stock, with or without par value (the "Preferred Stock") of Phillips, which may
be represented by depositary shares (the "Depositary Shares") evidenced by
depositary receipts (the "Receipts"); (iii) shares of Common Stock, $1.25 par
value per share, of Phillips (the "Common Stock"); (iv) stock purchase or
Preferred Stock contracts of Phillips ("Purchase Contracts") to purchase Common
Stock or Preferred Stock; (v) stock purchase units of Phillips ("Stock Purchase
Units"), each representing ownership of a Purchase Contract and any of Debt
Securities, debt obligations of third parties, including U.S. Treasury
securities, or Preferred Securities (as defined below) of a Trust, securing a
holder's obligation to purchase Common Stock or Preferred Stock under the
Purchase Contact, and (vi) guarantees (the "Guarantees") of Preferred Securities
to be issued by the Trusts, as described below.
I will also act as counsel to Phillips and the Trusts in
connection with offerings from time to time of Preferred Securities of the
Trusts (the "Preferred Securities") which are being registered under the
Registration Statement. The Preferred Securities are to be issued by each
Trust pursuant to an Amended and Restated Declaration of Trust (the "Amended
Declaration") to be filed with the Secretary of State
<PAGE> 3
Phillips Petroleum Company -3- May 22, 1998
of the State of Delaware by the Trustees of the relevant Trust. The Preferred
Securities are to be guaranteed by Phillips pursuant to Guarantees issued under
a Guarantee Agreement (the "Guarantee Agreement") to be entered into by
Phillips in respect of the Preferred Securities. The forms of Preferred
Securities, Amended Declaration and Guarantee Agreement are filed or
incorporated by reference as exhibits to the Registration Statement.
I have examined originals or copies, certified or otherwise
identified to my satisfaction, or such documents, corporate records,
certificates of public officials and other instruments as I have deemed
necessary or advisable for the purpose of rendering this opinion.
Based on the foregoing, I am of the opinion that:
1. The Debt Securities have been duly authorized for
issuance and, when (i) the Registration Statement has become effective under
the Act, (ii) the terms of the Debt Securities have been duly established in
accordance with the applicable Indenture and (iii) the Debt Securities have
been duly executed and authenticated in accordance with the applicable
Indenture and duly issued and delivered by Phillips in the manner contemplated
in the Registration Statement and any prospectus supplement relating thereto,
the Debt Securities (including any Debt Securities duly issued (x) upon
exchange or conversion of any shares of Preferred Stock that are exchangeable
or convertible into Debt Securities or (y) as part of Stock Purchase Units)
will constitute valid and binding obligations of Phillips, enforceable against
Phillips in accordance with their terms, except
<PAGE> 4
Phillips Petroleum Company -4- May 22, 1998
as (a) the enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or other similar laws now or
hereinafter in effect relating to or affecting the enforcement of creditors'
rights generally and (b) the availability of equitable remedies may be limited
by equitable principles of general applicability (regardless of whether
considered in a proceeding at law or in equity).
2. The shares of Preferred Stock have been duly authorized
and (i) when the Registration Statement has become effective under the Act, (ii)
when the terms of the Preferred Stock have been duly and properly authorized for
issuance and a Certificate of Designations for the Preferred Stock and setting
forth the terms thereof has been duly filed, (iii) when such shares of Preferred
Stock have been duly issued and paid for in the manner contemplated in the
Registration Statement and any prospectus supplement relating thereto, and (iv)
when the shares of Preferred Stock have been duly executed, countersigned and
delivered by the Company upon purchase thereof and payment in full therefor as
contemplated in the Registration Statement, such shares of Preferred Stock will
be validly issued, fully paid and nonassessable.
3. The shares of Common Stock have been duly authorized and
(i) when the Registration Statement has become effective under the Act and (ii)
when the shares of Common Stock have been duly executed, countersigned and
delivered by the Company upon purchase thereof and payment in full therefor as
contemplated in the Registration Statement, such shares of Common Stock will be
validly issued, fully paid and nonassessable.
4. The Guarantees have been duly authorized for issuance
and, when (i) the Registration Statement has become effective under the Act,
(ii) the applicable Guarantee Agreement has been duly executed and delivered
and (iii) the Preferred Securities have been duly issued and delivered by the
applicable Trust as contemplated
<PAGE> 5
Phillips Petroleum Company -5- May 22, 1998
by the Registration Statement and any prospectus supplement relating thereto,
the Guarantees will constitute valid and binding obligations of Phillips,
enforceable against Phillips in accordance with their terms, except as (a) the
enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or similar was now or
hereinafter in effect relating to or affecting the enforcement of creditors'
rights generally and (b) the availability of equitable remedies may be limited
by equitable principles of general applicability (regardless of whether
considered in a proceeding at law or in equity).
5. When (i) the Registration Statement has become
effective under the Act, (ii) a Deposit Agreement relating to the Depositary
Shares (the "Deposit Agreement") has been duly executed and delivered, (iii)
the terms of the Depositary Shares and of their issuance and sale have been
duly established in conformity with the Deposit Agreement relating to such
Depositary Shares, (iv) the terms of the Preferred Stock have been duly and
properly authorized for issuance and a Certificate of Designations for the
Preferred Stock and setting forth the terms thereof has been duly filed, (v)
such shares of Preferred stock have been duly issued and paid for in the manner
contemplated in the Registration Statement and any prospectus supplement
relating thereto, and (vi) the Receipts evidencing the Depositary Shares are
duly issued against the deposit of the Preferred Stock in accordance with the
Deposit Agreement, such Receipts will be validly issued and will entitle the
holders thereof to the rights specified therein and in the Deposit Agreement.
<PAGE> 6
Phillips Petroleum Company -6- May 22, 1998
6. When (i) the Registration Statement has become
effective under the Act, (ii) a Purchase Contract Agreement relating to the
purchase Contracts (the "Purchase Contract Agreement") has been duly executed
and delivered, (iii) the terms of the Purchase Contracts and of their issuance
and sale have been duly established in conformity with the Purchase Contract
Agreement and (iv) the Purchase Contracts have been duly executed and issued in
accordance with the Purchase Contract Agreement relating to such Purchase
Contracts, and issued and sold in the form and in the manner contemplated in
the Registration Statement and any prospectus supplement relating thereto, such
Purchase Contracts will constitute valid and binding obligations of Phillips,
enforceable in accordance with their terms, except as (a) enforceability
thereof may be limited by bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium and other similar laws now or hereafter in effect relating
to or affecting creditors' rights generally, and (b) the availability of
equitable remedies may be limited by equitable principles of generally
applicability (regardless of whether considered in a proceeding at law or in
equity).
7. Assuming that the Stock Purchase Units, a Purchase
Contract Agreement relating to the Purchase Contracts comprising a part of the
Stock Purchase Units and such Purchase Contracts has been duly authorized, when
(i) the Registration Statement has become effective under the Act, (ii) the
Purchase Contract Agreement has been duly executed and delivered, (iii) the
terms of the Purchase Contracts and of their issuance and sale have been duly
established in conformity with the Purchase Contract
<PAGE> 7
Phillips Petroleum Company -7- May 22, 1998
Agreement, (iv) the terms of the collateral arrangements relating to such Stock
Purchase Units have been duly established and the agreement(s) relating thereto
has been duly executed and delivered, and the collateral has been deposited
with the collateral agent in accordance with such arrangements, and (v) the
Purchase Contracts have been duly executed and issued in accordance with the
Purchase Contract Agreement relating to such Purchase Contracts, and issued and
sold in the form and in the manner contemplated in the Registration Statement
and any prospectus supplement relating thereto, such Stock Purchase Units will
constitute valid and binding obligations of Phillips, enforceable in accordance
with their terms, except as (a) the enforceability thereof may be limited by
bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium and
other similar laws now or hereafter in effect relating to or affecting
creditors' rights generally, and (b) the availability of equitable remedies may
be limited by equitable principles of general applicability (regardless of
whether considered in a proceeding at law or in equity).
I am a member of the Bar of the State of Oklahoma and my
opinion is limited to the Federal laws of the United States, the laws of the
State of Oklahoma and the Delaware General Corporation Law.
I hereby consent to the filing of this opinion as an exhibit
to the Registration Statement and to the use of my name under the heading
"Legal Matters" in the Prospectus forming a part of the Registration Statement.
Very truly yours,
Dale J. Billam, Esq.
<PAGE> 1
EXHIBIT 5-B
[Letterhead of Morris, Nichols, Arsht & Tunnell]
May 22, 1998
The Phillips Capital Trusts
(as defined below)
c/o Phillips Petroleum Company
Phillips Building
Bartlesville, Oklahoma 74004
Re: The Phillips Capital Trusts (as defined below)
Ladies and Gentlemen:
We have acted as special Delaware counsel to Phillips 66
Capital III, Phillips 66 Capital IV, Phillips 66 Capital V and Phillips 66
Capital VI, each a Delaware statutory business trust (collectively referred to
herein as the "Phillips Capital Trusts" and each individually as a "Phillips
Capital Trust"), in connection with certain matters relating to the creation of
the Phillips Capital Trusts and the proposed issuance of Preferred Securities
therein to beneficial owners pursuant to and as described in the Registration
Statement on Form S-3 filed with the Securities and Exchange Commission (the
"Commission") by Phillips Petroleum Company, a Delaware corporation (the
"Company"), and the Phillips Capital Trusts on May 22, 1998 (the "Registration
Statement"). Capitalized terms used herein and not otherwise herein defined
are used with respect to Phillips 66 Capital III and Phillips 66 Capital IV as
defined in the form of Amended and Restated Declaration of Trust of such
Phillips Capital Trust filed as an exhibit to the Company's Registration
Statement on Form S-3 (Reg. No. 333-01209) filed with the Commission on May 7,
1996 and incorporated by reference in the Registration Statement and with
respect to Phillips 66 Capital V and Phillips 66 Capital VI as defined in the
form of Amended and Restated Declaration of Trust of such Phillips Capital
Trust attached as an exhibit to the Registration Statement (the form of Amended
and Restated Declaration of Trust of each Phillips Capital Trust is referred to
herein as a "Governing Instrument") .
<PAGE> 2
The Phillips Capital Trusts
c/o Phillips Petroleum Company
May 22, 1998
Page 2
In rendering this opinion, we have examined copies of the
following documents in the forms provided to us: the Certificates of Trust of
Phillips 66 Capital III and Phillips 66 Capital IV, each as filed in the Office
of the Secretary of the State of Delaware (the "State Office") on February 23,
1996 and the Certificates of Trust of Phillips 66 Capital V and Phillips 66
Capital VI, each as filed in the State Office on May 22, 1998 (the Certificate
of Trust of each Phillips Capital Trust is referred to herein as a
"Certificate"); the Declaration of Trust of Phillips 66 Capital III and
Phillips 66 Capital IV, each dated as of February 23, 1996 and the Declaration
of Trust of Phillips 66 Capital V and Phillips 66 Capital VI, each dated as of
May 22, 1998 (the Declaration of Trust of each Phillips Capital Trust is
referred to herein as an "Original Governing Instrument"); each Governing
Instrument; the Indenture dated as of May 23, 1996 between the Company and The
Bank of New York, as Trustee, and the First Supplemental Indenture dated as of
May 23, 1996 and the Second Supplemental Indenture dated as of January 17, 1997
entered into in connection therewith; the form of Preferred Securities
Guarantee to be made by the Company with respect to each Phillips Capital Trust
(the form of Preferred Securities Guarantee of each Phillips Capital Trust is
referred to herein as a "Guarantee Agreement"); the form of Underwriting
Agreement relating to the Preferred Securities to be entered into between the
Company, on its own behalf and on behalf of each Phillips Capital Trust, and
Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated as
representative of the several underwriters named in Schedule A thereto (the
"Underwriting Agreement"); the Registration Statement; and a certification of
good standing of each Phillips Capital Trust obtained as of a recent date from
the State Office. In such examinations, we have assumed the genuineness of all
signatures, the conformity to original documents of all documents submitted to
us as drafts or copies or forms of documents to be executed and the legal
capacity of natural persons to complete the execution of documents. We have
further assumed for purposes of this opinion: (i) the due formation,
organization or creation, valid existence and good standing of the Phillips
Capital Trusts and each entity that is a party to any of the documents reviewed
by us under the laws of the jurisdiction of its respective formation,
organization or creation; (ii) the due authorization, execution and delivery
by, or on behalf of, each of the parties thereto of the above referenced
documents with respect to each Phillips Capital Trust; (iii) that the Company,
The Bank of New York, The Bank of New York (Delaware) and the appropriate
Regular Trustees will duly authorize, execute and deliver the applicable
Governing Instrument, the Underwriting Agreement and all other documents
contemplated thereby or by the Registration Statement to be executed in
connection with the issuance by each Phillips Capital Trust of Preferred
Securities, in each case prior to the first issuance of Preferred Securities of
such Phillips Capital Trust; (iv) that the Preferred Securities of each
Phillips Capital Trust will be offered and sold pursuant to a prospectus and a
prospectus supplement thereto (collectively, the "Prospectus") forming a part
of the Registration Statement that will be consistent with, and accurately
describe, the terms of the applicable Governing Instrument and the applicable
Guarantee Agreement relating to each such Phillips Capital Trust and all other
relevant documents; (v) that no event has occurred or will occur subsequent to
the filing of any Certificate that would cause a dissolution or liquidation of
any Phillips Capital Trust under the applicable Original Governing Instrument
or the applicable Governing Instrument; (vi) that the activities of each
Phillips Capital Trust have been and will be
<PAGE> 3
The Phillips Capital Trusts
c/o Phillips Petroleum Company
May 22, 1998
Page 3
conducted in accordance with its Original Governing Instrument or Governing
Instrument, as applicable, and the Delaware Business Trust Act, 12 Del. C.
Sections 3801 et seq. (the "Delaware Act"); (vii) that each Holder of
Preferred Securities of each Phillips Capital Trust will make payment of the
required consideration therefor and receive a Preferred Securities Certificate
in consideration thereof in accordance with the terms and conditions of the
applicable Governing Instrument, the Registration Statement, the applicable
prospectus supplement and the Underwriting Agreement, and that the Preferred
Securities of each Phillips Capital Trust are otherwise issued and sold to the
Preferred Securities Holders of such Phillips Capital Trust in accordance with
the terms, conditions, requirements and procedures set forth in the applicable
Governing Instrument, the Registration Statement, the applicable prospectus
supplement and the Underwriting Agreement; and (viii) that the documents
examined by us, or contemplated hereby, express the entire understanding of the
parties thereto with respect to the subject matter thereof and have not been,
and, prior to the issuance of Preferred Securities by each Phillips Capital
Trust, will not be, amended, supplemented or otherwise modified, except as
herein referenced. No opinion is expressed with respect to the requirements
of, or compliance with, federal or state securities or blue sky laws. Further,
we express no opinion with respect to the Registration Statement or any other
offering materials relating to the Preferred Securities offered by any Phillips
Capital Trust and we assume no responsibility for their contents. As to any
fact material to our opinion, other than those assumed, we have relied without
independent investigation on the above referenced documents and on the
accuracy, as of the date hereof, of the matters therein contained.
Based on and subject to the foregoing, and limited in all
respects to matters of Delaware law, it is our opinion that, upon issuance, the
Preferred Securities of each Phillips Capital Trust will constitute validly
issued and, subject to the terms of the applicable Governing Instrument, fully
paid and non-assessable beneficial interests in the assets of such Phillips
Capital Trust. We note that pursuant to each Governing Instrument, each
Phillips Capital Trust may withhold amounts otherwise distributable to a Holder
of Securities in such Phillips Capital Trust and pay over such amounts to the
applicable jurisdictions in accordance with federal, state and local law and
any amounts withheld will be deemed to have been distributed to such Holder and
that, pursuant to the Governing Instrument, the Preferred Security Holders of
each Phillips Capital Trust may be obligated to make payments or provide
indemnity or security under the circumstances set forth therein.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement and to the use of our name under the heading
"LEGAL MATTERS" in the Prospectus forming a part thereof. In giving this
consent, we do not thereby admit that we come within the category of persons
whose consent is required under Section 7 of the Securities Act of 1933, as
amended, or the rules and regulations of the Commission thereunder. This
opinion speaks only as of the date hereof and is based on our understandings
and assumptions as to present facts, and our review of the above referenced
documents and the application of Delaware law as the same exist on the date
hereof, and we undertake no obligation to update or supplement this opinion
after the date
<PAGE> 4
The Phillips Capital Trusts
c/o Phillips Petroleum Company
May 22, 1998
Page 4
hereof for the benefit of any person or entity with respect to any facts or
circumstances that may hereafter come to our attention or any changes in facts
or law that may hereafter occur or take effect. This opinion is intended
solely for the benefit of the addressees hereof in connection with the matters
contemplated hereby and may not be relied upon by any other person or entity or
for any other purpose without our prior written consent.
Very truly yours,
MORRIS, NICHOLS, ARSHT & TUNNELL
/s/ Morris, Nichols, Arsht & Tunnell
<PAGE> 1
EXHIBIT 23-A
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference of our firm under the caption "Experts" in the
Registration Statement (Form S-3), and related Prospectus of Phillips Petroleum
Company for the registration of $700,000,000 of its securities (as defined in
the Registration Statement) and to the incorporation by reference therein of
our report dated February 23, 1998, with respect to the consolidated financial
statements and schedule of Phillips Petroleum Company included in its Annual
Report (Form 10-K) for the year ended December 31, 1997, filed with the
Securities and Exchange Commission.
/s/ ERNST & YOUNG LLP
ERNST & YOUNG LLP
Tulsa, Oklahoma
May 22, 1998
<PAGE> 1
EXHIBIT 24
POWER OF ATTORNEY
Phillips Petroleum Company, a Delaware corporation, hereby authorizes
and appoints John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and
severally, as its true and lawful attorneys-in-fact and agent, with full power
of substitution and resubstitution, for it and in its name, place, and stead,
in any and all capacities, to sign any and all registration statements and
amendments thereto (including post-effective amendments) to be filed by
Phillips Petroleum Company (the "Company") on Form S-3 pursuant to resolutions
adopted by the Board of Directors of the Company on May 11, 1998, as the same
may be amended or supplemented, relating to the Company's securities, including
without limitation, senior and subordinated debt securities, equity securities
(common and preferred), depositary shares, guarantees of subsidiaries' and
affiliates' preferred securities, stock purchase contracts or units and
securities exchangeable for or convertible into securities of the Company or
third parties, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission,
granting unto each said attorney-in-fact and agent full power and authority to
do and perform each and every act and thing requisite and necessary to be done
in connection therewith, as fully to all intents and purposes as this Company
might or could do, hereby ratifying and confirming all that each said
attorney-in-fact and agent, or any of them, or his substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.
Dated this 22 day of May, 1998.
PHILLIPS PETROLEUM COMPANY
By: /s/ W. W. ALLEN
-----------------------------------
W. W. Allen
Chairman of the Board of Directors
and Chief Executive Officer
ATTEST:
/s/ DALE J. BILLAM
- ----------------------
Dale J. Billam
Secretary
<PAGE> 2
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as his
true and lawful attorneys-in-fact and agent, 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 registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ W. W. ALLEN
----------------------------------------
W. W. Allen
Chairman of the Board of Directors
and Chief Executive Officer;
Principal Executive Officer
Phillips Petroleum Company
Date: May 22, 1998
<PAGE> 3
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as his
true and lawful attorneys-in-fact and agent, 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 registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ NORMAN R. AUGUSTINE
----------------------------------------
Norman R. Augustine, Director
Phillips Petroleum Company
Date: May 11, 1998
<PAGE> 4
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as his
true and lawful attorneys-in-fact and agent, 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 registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ GEORGE B. BEITZEL
----------------------------------------
George B. Beitzel, Director
Phillips Petroleum Company
Date: May 12, 1998
<PAGE> 5
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as his
true and lawful attorneys-in-fact and agent, 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 registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ DAVID L. BOREN
----------------------------------------
David L. Boren, Director
Phillips Petroleum Company
Date: May 11, 1998
<PAGE> 6
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as his
true and lawful attorneys-in-fact and agent, 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 registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ C. L. BOWERMAN
----------------------------------------
C. L. Bowerman, Director
Phillips Petroleum Company
Date: May 6, 1998
<PAGE> 7
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as his
true and lawful attorneys-in-fact and agent, 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 registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ ROBERT E. CHAPPELL, JR.
----------------------------------------
Robert E. Chappell, Jr., Director
Phillips Petroleum Company
Date: May 11, 1998
<PAGE> 8
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as his
true and lawful attorneys-in-fact and agent, 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 registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ LAWRENCE S. EAGLEBURGER
----------------------------------------
Lawrence S. Eagleburger, Director
Phillips Petroleum Company
Date: May 11, 1998
<PAGE> 9
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as his
true and lawful attorneys-in-fact and agent, 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 registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ LARRY D. HORNER
----------------------------------------
Larry D. Horner, Director
Phillips Petroleum Company
Date: May 12, 1998
<PAGE> 10
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as his
true and lawful attorneys-in-fact and agent, 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 registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ J. J. MULVA
----------------------------------------
J. J. Mulva, Director
Phillips Petroleum Company
Date: May 11, 1998
<PAGE> 11
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as his
true and lawful attorneys-in-fact and agent, 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 registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ RANDALL L. TOBIAS
----------------------------------------
Randall L. Tobias, Director
Phillips Petroleum Company
Date: May 11, 1998
<PAGE> 12
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as her
true and lawful attorneys-in-fact and agent, with full power of substitution and
resubstitution, for her and in her name, place, and stead, in any and all
capacities, to sign any and all registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as she might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or her substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ VICTORIA J. TSCHINKEL
----------------------------------------
Victoria J. Tschinkel, Director
Phillips Petroleum Company
Date: May 11, 1998
<PAGE> 13
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as her
true and lawful attorneys-in-fact and agent, with full power of substitution and
resubstitution, for her and in her name, place, and stead, in any and all
capacities, to sign any and all registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as she might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or her substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ KATHRYN C. TURNER
----------------------------------------
Kathryn C. Turner, Director
Phillips Petroleum Company
Date: May 11, 1998
<PAGE> 14
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as his
true and lawful attorneys-in-fact and agent, 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 registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ RAND C. BERNEY
----------------------------------------
Rand C. Berney, Director
Vice President and Controller,
Principal Accounting Officer
Phillips Petroleum Company
Date: May 6, 1998
<PAGE> 15
POWER OF ATTORNEY
The person whose signature appears below hereby authorizes and appoints
John A. Carrig, Rand C. Berney and J. W. Sheets, jointly and severally, as his
true and lawful attorneys-in-fact and agent, 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 registration statements and amendments thereto
(including post-effective amendments) to be filed by Phillips Petroleum Company
(the "Company") on Form S-3 pursuant to resolutions adopted by the Board of
Directors of the Company on May 11, 1998, as the same may be amended or
supplemented, relating to the Company's securities, including without
limitation, senior and subordinated debt securities, equity securities (common
and preferred), depositary shares, guarantees of subsidiaries' and affiliates'
preferred securities, stock purchase contracts or units and securities
exchangeable for or convertible into securities of the Company or third parties,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
each said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that each said attorney-in-fact and
agent, or any of them, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
/s/ T. C. MORRIS
----------------------------------------
T. C. Morris, Senior Vice President
and Chief Financial Officer,
Principal Financial Officer
Phillips Petroleum Company
Date: May 12, 1998
<PAGE> 1
EXHIBIT 25-A
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 205549
-----------------------------
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)
--------------------------------------------------------
U.S. BANK TRUST NATIONAL ASSOCIATION
(Exact name of Trustee as specified in its charter)
<TABLE>
<S> <C> <C>
111 East Wacker Drive, Suite 3000
Chicago, Illinois 60601 36-4046888
(Address of principal executive offices) (Zip Code) I.R.S. Employer Identification No.
</TABLE>
Pamela A. Burrows
111 East Wacker Drive, Suite 3000
Chicago, Illinois 60601
Telephone (312) 228-9456
(Name, address and telephone number of agent for service)
PHILLIPS PETROLEUM COMPANY
(Exact name of obligor as,specified in its charter)
Delaware 73-0400345
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Phillips Building
Bartlesville, Oklahoma 74004
(Address of Principal Executive Offices) (Zip Code)
Debt Securities
(Title of the Indenture Securities)
================================================================================
<PAGE> 2
FORM T- I
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 the Currency
Washington, D.C.
b) Whether it is authorized to exercise corporate trust powers.
Yes
Item 2. AFFILIATIONS WITH OBLIGOR. If the obligor is an affiliate of the
Trustee. describe each such affiliation.
None
Items 3-15 There is not nor has there been a default with respect to the
securities under this Indenture. The Trustee is a Trustee
under other Indentures under which securities issued by the
obligor are outstanding. There is not and there has not been a
default with respect to the securities outstanding under such
other Indentures.
Item 16. LIST OF EXHIBITS: List below all exhibits filed as a part of this
statement of eligibility and qualification.
1. A copy of the Articles of Association of the Trustee now in
effect, incorporated herein by reference to Exhibit I of Form
T-1, Registration No. 333-18235,
2. A copy of the certificate of authority of the Trustee to
commence business, incorporated herein by reference to Exhibit
2 of Form T-1, Registration No. 333-18235.
3. A copy of the certificate of authority of the Trustee to
exercise corporate trust powers, incorporated herein by
reference to Exhibit 3 of Form T- 1, Registration No.
333-18235.
4. A copy of the existing bylaws of the Trustee, as now in effect,
incorporated herein by reference to Exhibit 4 of Form T- 1,
Registration No. 333-18235.
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of
the Trust Indenture Act of 1939, incorporated herein by
reference to Exhibit 6 of Form T-1, Registration No- 333
18235.
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, filed herewith.
8. Not applicable.
9. Not applicable.
2
<PAGE> 3
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as amended,
the Trustee, U.S. BANK TRUST NATIONAL ASSOCIATION, a national banking
association organized and existing under the laws of the United States of
America, has duly caused this statement of eligibility and qualification to be
signed on its behalf by the undersigned, thereunto duly authorized, all in the
City of Chicago, State of Illinois on the day of _, 1998.
U.S. BANK TRUST NATIONAL ASSOCIATION
BY: /s/ Pamela A. Burrows
----------------------------------
Pamela A, Burrows
Trust Officer
3
<PAGE> 4
<TABLE>
<S> <C> <C> <C>
U.S. Bank Trust National Association Call Date: 03/31/98 ST-BK: 17-1638 FFIEC 033
400 North Michigan Avenue Page RC-1
Chicago, IL 60611 Vendor ID: D CERT: 34094
9
Transit Number: 09600069
</TABLE>
Consolidated Report of Condition for Insured
Commercial and State-Chartered Savings Banks for March 31, 1998
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding as of the last business day of the
quarter.
Schedule RC - Balance Sheet
<TABLE>
<CAPTION>
C200 <-
Dollar Amounts in Thousands
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule RC-A): RCON
----
a. Noninterest-bearing balances and currency and coin(1)................................. 0081 56,244 1.a
b. Interest bearing balances(2).......................................................... 0071 0 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 3,219 2.b
3. Federal funds sold and securiites purchased under agreements to resell..................... 1350 0 3.
RCON
-----
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule RC-C)... 2122 0 4.a
b. LESS: Allowance for loan and lease losses....................... 3123 0 4.b
c. LESS: Allocated transfer risk reserve........................... 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 0 4.d
5. Trading assets ............................................................................ 3545 0 5.
6. Premises and fixed assets (including capitalized leases)................................... 2145 125 6.
7. Other real estate owned (from Schedule RC-M)............................................... 2150 0 7.
8. Investments in unconsolidated subsidiaries and associated companies (from Schedule
RC-M)...................................................................................... 2130 0 8.
9. Customers' liability to this bank on acceptances outstanding............................... 2155 0 9.
10. Intangible assets (from Schedule RC-M)..................................................... 2143 47,202 10.
11. Other assets (from Schedule RC-F).......................................................... 2160 2,713 11.
12. Total assets (sum of items 1 through 11)................................................... 2170 109,503 12.
</TABLE>
- ---------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE> 5
<TABLE>
<S> <C> <C> <C>
U.S. Bank Trust National Association Call Date: 03/31/98 ST-BK: 17-1638 FFIEC 033
400 North Michigan Avenue Page RC-2
Chicago, IL 60611 Vendor ID: D CERT: 34094
10
Transit Number: 09600069
Schedule RC - Continued
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Dollar Amounts in Thousands
- -----------------------------------------------------------------------------------------------------------------
RCON
----
<S> <C> <C> <C>
LIABILITIES
13. Deposits:
13. a. In domestic offices (sum of totals of
columns A and C from Schedule RC-E)..........................................2200.. 0 13.a
RCON
----
(1) Noninterest-bearing (1).......................6631.. 0 ............ 13.a.1
(2) Interest-bearing..............................6636.. 0 ............ 13.a.2
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs................. ............
(1) Noninterest-bearing....................................................... ............
(2) Interest-bearing.......................................................... ............
14. Federal funds purchased and securities sold under agreements to repurchase.......2800.. 0 14.
15. a. Demand notes issued to the U.S. Treasury......................................2840.. 0 15.a
b. Trading liabilities...........................................................3548.. 0 15.b
16. Other borrowed money (includes mortgage indebtedness and obligations under
capitalized leases):
a. With a remaining maturity of one year or less.................................2332.. 0 16.a
b. With a remaining maturity of more than one year through three years...........A547.. 0 16.b
c. With a remaining maturity of more than three years............................A548.. 0 16.c
17. Not applicable
18. Bank's liability on acceptances executed and outstanding.........................2920.. 0 18.
19. Subordinated notes and debentures (2)............................................3200.. 0 19.
20. Other liabilities (from Schedule RC-G)...........................................2930.. 2,454 20.
21. Total liabilities (sum of items 13 through 20)...................................2948.. 2,454 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus....................................3838.. 0 23.
24. Common stock.....................................................................3230.. 1,000 24.
25. Surplus (exclude all surplus related to preferred stock).........................3839.. 106,712 25.
26. a. Undivided profits and capital reserves........................................3632.. (663) 26.a
b. Net unrealized holding gains (losses) on available-for-sale securities........8434.. 0 26.b
27. Cumulative foreign currency translation adjustments.............................. ...........
28. Total equity capital (sum of items 23 through 27)................................3210.. 107,049 28.
29. Total liabilities and equity capital (sum of items 21 and 28)....................3300.. 109,503 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 auditors as of any date during 1997......................6724.. 2 M.1
1 = Independent audit of the bank conducted in accordance with generally accepted auditing standards by a certified
public accounting firm which submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in accordance with generally accepted auditing
standards by a certified public accounting firm which submits a report on the consolidated holding company (but
not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally accepted auditing standards by a
certified public accounting firm (may be required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors (may be required by state chartering
authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
- ---------------
(1) Includes total demand deposits and noninterest-bearing time and savings deposits.
(2) Includes limited life preferred stock and related surplus.
</TABLE>
<PAGE> 6
<TABLE>
<S> <C> <C> <C>
U.S. Bank Trust National Association Call Date: 03/31/98 ST-BK: 17-1638 FFIEC 033
400 North Michigan Avenue Page RC-3
Chicago, IL 60611 Vendor ID: D CERT: 34094
11
Transit Number: 09600069
</TABLE>
Schedule RC-A -- Cash and Balances Due from Depository Institutions
Exclude assets held for trading.
<TABLE>
<Caption<
C205 <-
Dollar Amounts in Thousands
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Cash items in process of collection, unposted debits, and currency and coin: RCON
----
a. Cash items in process of collection and unposted debits.............................. 0020 .. 0 1.a
b. Currency and coin.................................................................... 0080 .. 0 1.b
2. Balances due from depository institutions in the U.S.:
a. U.S. branches and agencies of foreign banks.......................................... 0083 .. 0 2.a
b. Other commercial banks in the U.S. and other depository institutions in the U.S...... 0085 .. 56,244 2.b
3. Balances due from banks in foreign countries and foreign central banks:
a. Foreign branches of other U.S. banks................................................. 0073 .. 0 3.a
b. Other banks in foreign countries and foreign central banks........................... 0074 .. 0 3.b
4. Balances due from Federal Reserve Banks................................................. 0090 .. 0 4.
5. Total (sum of items 1 through 4) (must equal Schedule RC, sum of items 1.a and 1.b)..... 0010 .. 56,244 5.
</TABLE>
Memorandum
<TABLE>
Dollar Amounts in Thousands
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Noninterest-bearing balances due from commercial banks in the U.S. RCON
----
(included in items 2.a and 2.b above)................................................... 0050.. 56,244 M.1
</TABLE>
<PAGE> 1
EXHIBIT 25-B
THIS CONFORMING PAPER FORMAT DOCUMENT IS BEING SUBMITTED
PURSUANT TO RULE 901(d) OF REGULATION S-T
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
---------------------
PHILLIPS 66 CAPITAL III
(Exact name of obligor as specified in its charter)
Delaware 73-6293884
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Phillips Building
Bartlesville, Oklahoma 74004
(Address of principal executive offices) (Zip code)
---------------------
Preferred Securities
(Title of the indenture securities)
================================================================================
<PAGE> 2
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.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------
Name Address
- -----------------------------------------------------------------------------------------
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which
contains the authority to commence business and a grant of
powers to exercise corporate trust powers. (Exhibit 1 to
Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with
Registration Statement No. 33-21672 and Exhibit 1 to Form T-1
filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to
Form T-1 filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the
Act. (Exhibit 6 to Form T-1 filed with Registration Statement
No. 33-44051.)
7. A copy of the latest report of condition of the Trustee
published pursuant to law or to the requirements of its
supervising or examining authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 21st day of May, 1998.
THE BANK OF NEW YORK
By: /s/ VAN K. BROWN
-------------------------------
Name: VAN K. BROWN
Title: ASSISTANT VICE PRESIDENT
-4-
<PAGE> 5
EXHIBIT 25-B
--------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business December 31,
1997, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin ..................................................... $ 5,742,986
Interest-bearing balances .............................................. 1,342,769
Securities:
Held-to-maturity securities ............................................ 1,099,736
Available-for-sale securities .......................................... 3,882,686
Federal funds sold and Securities pur-
chased under agreements to resell....................................... 2,568,530
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................35,019,608
LESS: Allowance for loan and
lease losses ..............627,350
LESS: Allocated transfer risk
reserve..........................0
Loans and leases, net of unearned
income, allowance, and reserve........................................ 34,392,258
Assets held in trading accounts .......................................... 2,521,451
Premises and fixed assets (including
capitalized leases) .................................................... 659,209
Other real estate owned .................................................. 11,992
Investments in unconsolidated
subsidiaries and associated
companies .............................................................. 226,263
Customers' liability to this bank on
acceptances outstanding ................................................ 1,187,449
Intangible assets ........................................................ 781,684
Other assets ............................................................. 1,736,574
-----------
Total assets ............................................................. $56,153,587
===========
LIABILITIES
Deposits:
In domestic offices .................................................... $27,031,362
Noninterest-bearing ......11,899,507
Interest-bearing .........15,131,855
In foreign offices, Edge and
Agreement subsidiaries, and IBFs ....................................... 13,794,449
Noninterest-bearing .........590,999
Interest-bearing .........13,203,450
Federal funds purchased and Securities
sold under agreements to repurchase..................................... 2,338,881
Demand notes issued to the U.S.
Treasury ............................................................... 173,851
Trading liabilities ...................................................... 1,695,216
Other borrowed money:
With remaining maturity of one year
or less .............................................................. 1,905,330
With remaining maturity of more than
one year through three years.......................................... 0
With remaining maturity of more than
three years .......................................................... 25,664
Bank's liability on acceptances exe-
cuted and outstanding .................................................. 1,195,923
Subordinated notes and debentures ........................................ 1,012,940
Other liabilities ........................................................ 2,018,960
-----------
Total liabilities ........................................................ 51,192,576
-----------
EQUITY CAPITAL
Common stock ............................................................. 1,135,284
Surplus .................................................................. 731,319
Undivided profits and capital
reserves ............................................................... 3,093,726
Net unrealized holding gains
(losses) on available-for-sale
securities ............................................................. 36,866
Cumulative foreign currency transla-
tion adjustments ....................................................... (36,184)
-----------
Total equity capital ..................................................... 4,961,011
-----------
Total liabilities and equity
capital ................................................................ $56,153,587
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi )
Alan R. Griffith ) Directors
J. Carter Bacot )
--------------------------
<PAGE> 1
EXHIBIT 25-C
THIS CONFORMING PAPER FORMAT DOCUMENT IS BEING SUBMITTED
PURSUANT TO RULE 901(d) OF REGULATION S-T
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
PHILLIPS 66 CAPITAL IV
(Exact name of obligor as specified in its charter)
Delaware 73-6293886
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Phillips Building
Bartlesville, Oklahoma 74004
(Address of principal executive offices) (Zip code)
----------------------
Preferred Securities
(Title of the indenture securities)
================================================================================
<PAGE> 2
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.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------
Name Address
- -------------------------------------------------------------------------------------------
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which
contains the authority to commence business and a grant of
powers to exercise corporate trust powers. (Exhibit 1 to
Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with
Registration Statement No. 33-21672 and Exhibit 1 to Form T-1
filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to
Form T-1 filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the
Act. (Exhibit 6 to Form T-1 filed with Registration Statement
No. 33-44051.)
7. A copy of the latest report of condition of the Trustee
published pursuant to law or to the requirements of its
supervising or examining authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 21st day of May, 1998.
THE BANK OF NEW YORK
By: /s/ VAN K. BROWN
-------------------------------
Name: VAN K. BROWN
Title: ASSISTANT VICE PRESIDENT
-4-
<PAGE> 5
EXHIBIT 25-C
--------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business December 31,
1997, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin ..................................................... $ 5,742,986
Interest-bearing balances .............................................. 1,342,769
Securities:
Held-to-maturity securities ............................................ 1,099,736
Available-for-sale securities .......................................... 3,882,686
Federal funds sold and Securities pur-
chased under agreements to resell....................................... 2,568,530
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................35,019,608
LESS: Allowance for loan and
lease losses ..............627,350
LESS: Allocated transfer risk
reserve..........................0
Loans and leases, net of unearned
income, allowance, and reserve........................................ 34,392,258
Assets held in trading accounts .......................................... 2,521,451
Premises and fixed assets (including
capitalized leases) .................................................... 659,209
Other real estate owned .................................................. 11,992
Investments in unconsolidated
subsidiaries and associated
companies .............................................................. 226,263
Customers' liability to this bank on
acceptances outstanding ................................................ 1,187,449
Intangible assets ........................................................ 781,684
Other assets ............................................................. 1,736,574
-----------
Total assets ............................................................. $56,153,587
===========
LIABILITIES
Deposits:
In domestic offices .................................................... $27,031,362
Noninterest-bearing ......11,899,507
Interest-bearing .........15,131,855
In foreign offices, Edge and
Agreement subsidiaries, and IBFs ....................................... 13,794,449
Noninterest-bearing .........590,999
Interest-bearing .........13,203,450
Federal funds purchased and Securities
sold under agreements to repurchase..................................... 2,338,881
Demand notes issued to the U.S.
Treasury ............................................................... 173,851
Trading liabilities ...................................................... 1,695,216
Other borrowed money:
With remaining maturity of one year
or less .............................................................. 1,905,330
With remaining maturity of more than
one year through three years.......................................... 0
With remaining maturity of more than
three years .......................................................... 25,664
Bank's liability on acceptances exe-
cuted and outstanding .................................................. 1,195,923
Subordinated notes and debentures ........................................ 1,012,940
Other liabilities ........................................................ 2,018,960
-----------
Total liabilities ........................................................ 51,192,576
-----------
EQUITY CAPITAL
Common stock ............................................................. 1,135,284
Surplus .................................................................. 731,319
Undivided profits and capital
reserves ............................................................... 3,093,726
Net unrealized holding gains
(losses) on available-for-sale
securities ............................................................. 36,866
Cumulative foreign currency transla-
tion adjustments ....................................................... (36,184)
-----------
Total equity capital ..................................................... 4,961,011
-----------
Total liabilities and equity
capital ................................................................ $56,153,587
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi )
Alan R. Griffith ) Directors
J. Carter Bacot )
--------------------------
<PAGE> 1
CONFORMED COPY
EXHIBIT 25-D
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
---------------------
PHILLIPS 66 CAPITAL V
(Exact name of obligor as specified in its charter)
Delaware To Be Applied For
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Phillips Building
Bartlesville, Oklahoma 74004
(Address of principal executive offices) (Zip code)
---------------------
Preferred Securities
(Title of the indenture securities)
================================================================================
<PAGE> 2
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.
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany,
N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains
the authority to commence business and a grant of powers to
exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to
Form T-1 filed with Registration Statement No. 33-6215, Exhibits
1a and 1b to Form T-1 filed with Registration Statement No.
33-21672 and Exhibit 1 to Form T-1 filed with Registration
Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form
T-1 filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or
examining authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 21st day of May, 1998.
THE BANK OF NEW YORK
By: /s/ VAN K. BROWN
---------------------------------
Name: VAN K. BROWN
Title: ASSISTANT VICE PRESIDENT
-4-
<PAGE> 5
EXHIBIT 25-D
--------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business December 31,
1997, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin ..................................................... $ 5,742,986
Interest-bearing balances .............................................. 1,342,769
Securities:
Held-to-maturity securities ............................................ 1,099,736
Available-for-sale securities .......................................... 3,882,686
Federal funds sold and Securities pur-
chased under agreements to resell....................................... 2,568,530
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................35,019,608
LESS: Allowance for loan and
lease losses ..............627,350
LESS: Allocated transfer risk
reserve..........................0
Loans and leases, net of unearned
income, allowance, and reserve........................................ 34,392,258
Assets held in trading accounts .......................................... 2,521,451
Premises and fixed assets (including
capitalized leases) .................................................... 659,209
Other real estate owned .................................................. 11,992
Investments in unconsolidated
subsidiaries and associated
companies .............................................................. 226,263
Customers' liability to this bank on
acceptances outstanding ................................................ 1,187,449
Intangible assets ........................................................ 781,684
Other assets ............................................................. 1,736,574
-----------
Total assets ............................................................. $56,153,587
===========
LIABILITIES
Deposits:
In domestic offices .................................................... $27,031,362
Noninterest-bearing ......11,899,507
Interest-bearing .........15,131,855
In foreign offices, Edge and
Agreement subsidiaries, and IBFs ....................................... 13,794,449
Noninterest-bearing .........590,999
Interest-bearing .........13,203,450
Federal funds purchased and Securities
sold under agreements to repurchase..................................... 2,338,881
Demand notes issued to the U.S.
Treasury ............................................................... 173,851
Trading liabilities ...................................................... 1,695,216
Other borrowed money:
With remaining maturity of one year
or less .............................................................. 1,905,330
With remaining maturity of more than
one year through three years.......................................... 0
With remaining maturity of more than
three years .......................................................... 25,664
Bank's liability on acceptances exe-
cuted and outstanding .................................................. 1,195,923
Subordinated notes and debentures ........................................ 1,012,940
Other liabilities ........................................................ 2,018,960
-----------
Total liabilities ........................................................ 51,192,576
-----------
EQUITY CAPITAL
Common stock ............................................................. 1,135,284
Surplus .................................................................. 731,319
Undivided profits and capital
reserves ............................................................... 3,093,726
Net unrealized holding gains
(losses) on available-for-sale
securities ............................................................. 36,866
Cumulative foreign currency transla-
tion adjustments ....................................................... (36,184)
-----------
Total equity capital ..................................................... 4,961,011
-----------
Total liabilities and equity
capital ................................................................ $56,153,587
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi )
Alan R. Griffith ) Directors
J. Carter Bacot )
--------------------------
<PAGE> 1
EXHIBIT 25-E
THIS CONFORMING PAPER FORMAT DOCUMENT IS BEING SUBMITTED
PURSUANT TO RULE 901(d) OF REGULATION S-T
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
PHILLIPS 66 CAPITAL VI
(Exact name of obligor as specified in its charter)
Delaware To Be Applied For
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Phillips Building
Bartlesville, Oklahoma 74004
(Address of principal executive offices) (Zip code)
----------------------
Preferred Securities
(Title of the indenture securities)
================================================================================
<PAGE> 2
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.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE
7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 21st day of May, 1998.
THE BANK OF NEW YORK
By: /s/ VAN K. BROWN
-------------------------------
Name: VAN K. BROWN
Title: ASSISTANT VICE PRESIDENT
-4-
<PAGE> 5
EXHIBIT 25-E
---------------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business December 31,
1997, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin ..................................................... $ 5,742,986
Interest-bearing balances .............................................. 1,342,769
Securities:
Held-to-maturity securities ............................................ 1,099,736
Available-for-sale securities .......................................... 3,882,686
Federal funds sold and Securities pur-
chased under agreements to resell....................................... 2,568,530
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................35,019,608
LESS: Allowance for loan and
lease losses ..............627,350
LESS: Allocated transfer risk
reserve..........................0
Loans and leases, net of unearned
income, allowance, and reserve........................................ 34,392,258
Assets held in trading accounts .......................................... 2,521,451
Premises and fixed assets (including
capitalized leases) .................................................... 659,209
Other real estate owned .................................................. 11,992
Investments in unconsolidated
subsidiaries and associated
companies .............................................................. 226,263
Customers' liability to this bank on
acceptances outstanding ................................................ 1,187,449
Intangible assets ........................................................ 781,684
Other assets ............................................................. 1,736,574
-----------
Total assets ............................................................. $56,153,587
===========
LIABILITIES
Deposits:
In domestic offices .................................................... $27,031,362
Noninterest-bearing ......11,899,507
Interest-bearing .........15,131,855
In foreign offices, Edge and
Agreement subsidiaries, and IBFs ....................................... 13,794,449
Noninterest-bearing .........590,999
Interest-bearing .........13,203,450
Federal funds purchased and Securities
sold under agreements to repurchase..................................... 2,338,881
Demand notes issued to the U.S.
Treasury ............................................................... 173,851
Trading liabilities ...................................................... 1,695,216
Other borrowed money:
With remaining maturity of one year
or less .............................................................. 1,905,330
With remaining maturity of more than
one year through three years.......................................... 0
With remaining maturity of more than
three years .......................................................... 25,664
Bank's liability on acceptances exe-
cuted and outstanding .................................................. 1,195,923
Subordinated notes and debentures ........................................ 1,012,940
Other liabilities ........................................................ 2,018,960
-----------
Total liabilities ........................................................ 51,192,576
-----------
EQUITY CAPITAL
Common stock ............................................................. 1,135,284
Surplus .................................................................. 731,319
Undivided profits and capital
reserves ............................................................... 3,093,726
Net unrealized holding gains
(losses) on available-for-sale
securities ............................................................. 36,866
Cumulative foreign currency transla-
tion adjustments ....................................................... (36,184)
-----------
Total equity capital ..................................................... 4,961,011
-----------
Total liabilities and equity
capital ................................................................ $56,153,587
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi )
Alan R. Griffith ) Directors
J. Carter Bacot )
---------------------------------
<PAGE> 1
EXHIBIT 25-F
THIS CONFORMING PAPER FORMAT DOCUMENT IS BEING SUBMITTED
PURSUANT TO RULE 901(d) OF REGULATION S-T
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
PHILLIPS PETROLEUM COMPANY
(Exact name of obligor as specified in its charter)
Delaware 73-0400345
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Phillips Building
Bartlesville, Oklahoma 74004
(Address of principal executive offices) (Zip code)
----------------------
Guarantees of Preferred Securities of Phillips 66 Capital III
(Title of the indenture securities)
================================================================================
<PAGE> 2
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.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE
7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York (formerly
Irving Trust Company) as now in effect, which contains the authority to
commence business and a grant of powers to exercise corporate trust powers.
(Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration
Statement No. 33-21672 and Exhibit 1 to Form T-1 filed with Registration
Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed
with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the Act. (Exhibit
6 to Form T-1 filed with Registration Statement No. 33-44051.)
7. A copy of the latest report of condition of the Trustee published pursuant
to law or to the requirements of its supervising or examining authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 21st day of May, 1998.
THE BANK OF NEW YORK
By: /s/ VAN K. BROWN
---------------------------------
Name: VAN K. BROWN
Title: ASSISTANT VICE PRESIDENT
-4-
<PAGE> 5
---------------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business December 31,
1997, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin ..................................................... $ 5,742,986
Interest-bearing balances .............................................. 1,342,769
Securities:
Held-to-maturity securities ............................................ 1,099,736
Available-for-sale securities .......................................... 3,882,686
Federal funds sold and Securities pur-
chased under agreements to resell....................................... 2,568,530
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................35,019,608
LESS: Allowance for loan and
lease losses ..............627,350
LESS: Allocated transfer risk
reserve..........................0
Loans and leases, net of unearned
income, allowance, and reserve........................................ 34,392,258
Assets held in trading accounts .......................................... 2,521,451
Premises and fixed assets (including
capitalized leases) .................................................... 659,209
Other real estate owned .................................................. 11,992
Investments in unconsolidated
subsidiaries and associated
companies .............................................................. 226,263
Customers' liability to this bank on
acceptances outstanding ................................................ 1,187,449
Intangible assets ........................................................ 781,684
Other assets ............................................................. 1,736,574
-----------
Total assets ............................................................. $56,153,587
===========
LIABILITIES
Deposits:
In domestic offices .................................................... $27,031,362
Noninterest-bearing ......11,899,507
Interest-bearing .........15,131,855
In foreign offices, Edge and
Agreement subsidiaries, and IBFs ....................................... 13,794,449
Noninterest-bearing .........590,999
Interest-bearing .........13,203,450
Federal funds purchased and Securities
sold under agreements to repurchase..................................... 2,338,881
Demand notes issued to the U.S.
Treasury ............................................................... 173,851
Trading liabilities ...................................................... 1,695,216
Other borrowed money:
With remaining maturity of one year
or less .............................................................. 1,905,330
With remaining maturity of more than
one year through three years.......................................... 0
With remaining maturity of more than
three years .......................................................... 25,664
Bank's liability on acceptances exe-
cuted and outstanding .................................................. 1,195,923
Subordinated notes and debentures ........................................ 1,012,940
Other liabilities ........................................................ 2,018,960
-----------
Total liabilities ........................................................ 51,192,576
-----------
EQUITY CAPITAL
Common stock ............................................................. 1,135,284
Surplus .................................................................. 731,319
Undivided profits and capital
reserves ............................................................... 3,093,726
Net unrealized holding gains
(losses) on available-for-sale
securities ............................................................. 36,866
Cumulative foreign currency transla-
tion adjustments ....................................................... (36,184)
-----------
Total equity capital ..................................................... 4,961,011
-----------
Total liabilities and equity
capital ................................................................ $56,153,587
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi )
Alan R. Griffith ) Directors
J. Carter Bacot )
---------------------------------
<PAGE> 1
EXHIBIT 25-G
THIS CONFORMING PAPER FORMAT DOCUMENT IS BEING SUBMITTED
PURSUANT TO RULE 901(d) OF REGULATION S-T
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
PHILLIPS PETROLEUM COMPANY
(Exact name of obligor as specified in its charter)
Delaware 73-0400345
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Phillips Building
Bartlesville, Oklahoma 74004
(Address of principal executive offices) (Zip code)
----------------------
Guarantees of Preferred Securities of Phillips 66 Capital IV
(Title of the indenture securities)
================================================================================
<PAGE> 2
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.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE
7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 21st day of May, 1998.
THE BANK OF NEW YORK
By: /s/ VAN K. BROWN
-------------------------------
Name: VAN K. BROWN
Title: ASSISTANT VICE PRESIDENT
-4-
<PAGE> 5
EXHIBIT 25-G
---------------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business December 31,
1997, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin ..................................................... $ 5,742,986
Interest-bearing balances .............................................. 1,342,769
Securities:
Held-to-maturity securities ............................................ 1,099,736
Available-for-sale securities .......................................... 3,882,686
Federal funds sold and Securities pur-
chased under agreements to resell....................................... 2,568,530
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................35,019,608
LESS: Allowance for loan and
lease losses ..............627,350
LESS: Allocated transfer risk
reserve..........................0
Loans and leases, net of unearned
income, allowance, and reserve........................................ 34,392,258
Assets held in trading accounts .......................................... 2,521,451
Premises and fixed assets (including
capitalized leases) .................................................... 659,209
Other real estate owned .................................................. 11,992
Investments in unconsolidated
subsidiaries and associated
companies .............................................................. 226,263
Customers' liability to this bank on
acceptances outstanding ................................................ 1,187,449
Intangible assets ........................................................ 781,684
Other assets ............................................................. 1,736,574
-----------
Total assets ............................................................. $56,153,587
===========
LIABILITIES
Deposits:
In domestic offices .................................................... $27,031,362
Noninterest-bearing ......11,899,507
Interest-bearing .........15,131,855
In foreign offices, Edge and
Agreement subsidiaries, and IBFs ....................................... 13,794,449
Noninterest-bearing .........590,999
Interest-bearing .........13,203,450
Federal funds purchased and Securities
sold under agreements to repurchase..................................... 2,338,881
Demand notes issued to the U.S.
Treasury ............................................................... 173,851
Trading liabilities ...................................................... 1,695,216
Other borrowed money:
With remaining maturity of one year
or less .............................................................. 1,905,330
With remaining maturity of more than
one year through three years.......................................... 0
With remaining maturity of more than
three years .......................................................... 25,664
Bank's liability on acceptances exe-
cuted and outstanding .................................................. 1,195,923
Subordinated notes and debentures ........................................ 1,012,940
Other liabilities ........................................................ 2,018,960
-----------
Total liabilities ........................................................ 51,192,576
-----------
EQUITY CAPITAL
Common stock ............................................................. 1,135,284
Surplus .................................................................. 731,319
Undivided profits and capital
reserves ............................................................... 3,093,726
Net unrealized holding gains
(losses) on available-for-sale
securities ............................................................. 36,866
Cumulative foreign currency transla-
tion adjustments ....................................................... (36,184)
-----------
Total equity capital ..................................................... 4,961,011
-----------
Total liabilities and equity
capital ................................................................ $56,153,587
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi )
Alan R. Griffith ) Directors
J. Carter Bacot )
---------------------------------
<PAGE> 1
THIS CONFORMING PAPER FORMAT DOCUMENT IS BEING SUBMITTED
PURSUANT TO RULE 901(d) OF REGULATION S-T
EXHIBIT 25-H
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------
PHILLIPS PETROLEUM COMPANY
(Exact name of obligor as specified in its charter)
Delaware 73-0400345
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Phillips Building
Bartlesville, Oklahoma 74004
(Address of principal executive offices) (Zip code)
----------------
Guarantees of Preferred Securities of Phillips 66 Capital V
(Title of the indenture securities)
================================================================================
<PAGE> 2
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.
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE
7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 21st day of May, 1998.
THE BANK OF NEW YORK
By: /s/ VAN K. BROWN
---------------------------------
Name: VAN K. BROWN
Title: ASSISTANT VICE PRESIDENT
-4-
<PAGE> 5
EXHIBIT 25-H
---------------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business December 31,
1997, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin ..................................................... $ 5,742,986
Interest-bearing balances .............................................. 1,342,769
Securities:
Held-to-maturity securities ............................................ 1,099,736
Available-for-sale securities .......................................... 3,882,686
Federal funds sold and Securities pur-
chased under agreements to resell....................................... 2,568,530
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................35,019,608
LESS: Allowance for loan and
lease losses ..............627,350
LESS: Allocated transfer risk
reserve..........................0
Loans and leases, net of unearned
income, allowance, and reserve........................................ 34,392,258
Assets held in trading accounts .......................................... 2,521,451
Premises and fixed assets (including
capitalized leases) .................................................... 659,209
Other real estate owned .................................................. 11,992
Investments in unconsolidated
subsidiaries and associated
companies .............................................................. 226,263
Customers' liability to this bank on
acceptances outstanding ................................................ 1,187,449
Intangible assets ........................................................ 781,684
Other assets ............................................................. 1,736,574
-----------
Total assets ............................................................. $56,153,587
===========
LIABILITIES
Deposits:
In domestic offices .................................................... $27,031,362
Noninterest-bearing ......11,899,507
Interest-bearing .........15,131,855
In foreign offices, Edge and
Agreement subsidiaries, and IBFs ....................................... 13,794,449
Noninterest-bearing .........590,999
Interest-bearing .........13,203,450
Federal funds purchased and Securities
sold under agreements to repurchase..................................... 2,338,881
Demand notes issued to the U.S.
Treasury ............................................................... 173,851
Trading liabilities ...................................................... 1,695,216
Other borrowed money:
With remaining maturity of one year
or less .............................................................. 1,905,330
With remaining maturity of more than
one year through three years.......................................... 0
With remaining maturity of more than
three years .......................................................... 25,664
Bank's liability on acceptances exe-
cuted and outstanding .................................................. 1,195,923
Subordinated notes and debentures ........................................ 1,012,940
Other liabilities ........................................................ 2,018,960
-----------
Total liabilities ........................................................ 51,192,576
-----------
EQUITY CAPITAL
Common stock ............................................................. 1,135,284
Surplus .................................................................. 731,319
Undivided profits and capital
reserves ............................................................... 3,093,726
Net unrealized holding gains
(losses) on available-for-sale
securities ............................................................. 36,866
Cumulative foreign currency transla-
tion adjustments ....................................................... (36,184)
-----------
Total equity capital ..................................................... 4,961,011
-----------
Total liabilities and equity
capital ................................................................ $56,153,587
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi )
Alan R. Griffith ) Directors
J. Carter Bacot )
---------------------------------
<PAGE> 1
THIS CONFORMING PAPER FORMAT DOCUMENT IS BEING SUBMITTED
PURSUANT TO RULE 901(d) OF REGULATION S-T
EXHIBIT 25-I
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
PHILLIPS PETROLEUM COMPANY
(Exact name of obligor as specified in its charter)
Delaware 73-0400345
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Phillips Building
Bartlesville, Oklahoma 74004
(Address of principal executive offices) (Zip code)
----------------------
Guarantees of Preferred Securities of Phillips 66 Capital VI
(Title of the indenture securities)
================================================================================
<PAGE> 2
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.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which
contains the authority to commence business and a grant of
powers to exercise corporate trust powers. (Exhibit 1 to
Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with
Registration Statement No. 33-21672 and Exhibit 1 to Form T-1
filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to
Form T-1 filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the
Act. (Exhibit 6 to Form T-1 filed with Registration Statement
No. 33-44051.)
7. A copy of the latest report of condition of the Trustee
published pursuant to law or to the requirements of its
supervising or examining authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 21st day of May, 1998.
THE BANK OF NEW YORK
By: /s/ VAN K. BROWN
-----------------------------------
Name: VAN K. BROWN
Title: ASSISTANT VICE PRESIDENT
- 3 -
<PAGE> 5
EXHIBIT 25-I
---------------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business December 31,
1997, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin ..................................................... $ 5,742,986
Interest-bearing balances .............................................. 1,342,769
Securities:
Held-to-maturity securities ............................................ 1,099,736
Available-for-sale securities .......................................... 3,882,686
Federal funds sold and Securities pur-
chased under agreements to resell....................................... 2,568,530
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................35,019,608
LESS: Allowance for loan and
lease losses ..............627,350
LESS: Allocated transfer risk
reserve..........................0
Loans and leases, net of unearned
income, allowance, and reserve........................................ 34,392,258
Assets held in trading accounts .......................................... 2,521,451
Premises and fixed assets (including
capitalized leases) .................................................... 659,209
Other real estate owned .................................................. 11,992
Investments in unconsolidated
subsidiaries and associated
companies .............................................................. 226,263
Customers' liability to this bank on
acceptances outstanding ................................................ 1,187,449
Intangible assets ........................................................ 781,684
Other assets ............................................................. 1,736,574
-----------
Total assets ............................................................. $56,153,587
===========
LIABILITIES
Deposits:
In domestic offices .................................................... $27,031,362
Noninterest-bearing ......11,899,507
Interest-bearing .........15,131,855
In foreign offices, Edge and
Agreement subsidiaries, and IBFs ....................................... 13,794,449
Noninterest-bearing .........590,999
Interest-bearing .........13,203,450
Federal funds purchased and Securities
sold under agreements to repurchase..................................... 2,338,881
Demand notes issued to the U.S.
Treasury ............................................................... 173,851
Trading liabilities ...................................................... 1,695,216
Other borrowed money:
With remaining maturity of one year
or less .............................................................. 1,905,330
With remaining maturity of more than
one year through three years.......................................... 0
With remaining maturity of more than
three years .......................................................... 25,664
Bank's liability on acceptances exe-
cuted and outstanding .................................................. 1,195,923
Subordinated notes and debentures ........................................ 1,012,940
Other liabilities ........................................................ 2,018,960
-----------
Total liabilities ........................................................ 51,192,576
-----------
EQUITY CAPITAL
Common stock ............................................................. 1,135,284
Surplus .................................................................. 731,319
Undivided profits and capital
reserves ............................................................... 3,093,726
Net unrealized holding gains
(losses) on available-for-sale
securities ............................................................. 36,866
Cumulative foreign currency transla-
tion adjustments ....................................................... (36,184)
-----------
Total equity capital ..................................................... 4,961,011
-----------
Total liabilities and equity
capital ................................................................ $56,153,587
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi )
Alan R. Griffith ) Directors
J. Carter Bacot )
---------------------------------
<PAGE> 1
EXHIBIT 25-J
THIS CONFORMING PAPER FORMAT DOCUMENT IS BEING SUBMITTED PURSUANT TO RULE
901(d) OF REGULATION S-T
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
PHILLIPS PETROLEUM COMPANY
(Exact name of obligor as specified in its charter)
Delaware 73-0400345
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Phillips Building
Bartlesville, Oklahoma 74004
(Address of principal executive offices) (Zip code)
----------------------
Debt Securities
(Title of the indenture securities)
================================================================================
<PAGE> 2
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.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE
7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
- 2 -
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
- 3 -
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 21st day of May, 1998.
THE BANK OF NEW YORK
By: /s/ VAN K. BROWN
----------------------------------
Name: VAN K. BROWN
Title: ASSISTANT VICE PRESIDENT
- 4 -
<PAGE> 5
EXHIBIT 25-J
---------------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business December 31,
1997, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin ..................................................... $ 5,742,986
Interest-bearing balances .............................................. 1,342,769
Securities:
Held-to-maturity securities ............................................ 1,099,736
Available-for-sale securities .......................................... 3,882,686
Federal funds sold and Securities pur-
chased under agreements to resell....................................... 2,568,530
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................35,019,608
LESS: Allowance for loan and
lease losses ..............627,350
LESS: Allocated transfer risk
reserve..........................0
Loans and leases, net of unearned
income, allowance, and reserve........................................ 34,392,258
Assets held in trading accounts .......................................... 2,521,451
Premises and fixed assets (including
capitalized leases) .................................................... 659,209
Other real estate owned .................................................. 11,992
Investments in unconsolidated
subsidiaries and associated
companies .............................................................. 226,263
Customers' liability to this bank on
acceptances outstanding ................................................ 1,187,449
Intangible assets ........................................................ 781,684
Other assets ............................................................. 1,736,574
-----------
Total assets ............................................................. $56,153,587
===========
LIABILITIES
Deposits:
In domestic offices .................................................... $27,031,362
Noninterest-bearing ......11,899,507
Interest-bearing .........15,131,855
In foreign offices, Edge and
Agreement subsidiaries, and IBFs ....................................... 13,794,449
Noninterest-bearing .........590,999
Interest-bearing .........13,203,450
Federal funds purchased and Securities
sold under agreements to repurchase..................................... 2,338,881
Demand notes issued to the U.S.
Treasury ............................................................... 173,851
Trading liabilities ...................................................... 1,695,216
Other borrowed money:
With remaining maturity of one year
or less .............................................................. 1,905,330
With remaining maturity of more than
one year through three years.......................................... 0
With remaining maturity of more than
three years .......................................................... 25,664
Bank's liability on acceptances exe-
cuted and outstanding .................................................. 1,195,923
Subordinated notes and debentures ........................................ 1,012,940
Other liabilities ........................................................ 2,018,960
-----------
Total liabilities ........................................................ 51,192,576
-----------
EQUITY CAPITAL
Common stock ............................................................. 1,135,284
Surplus .................................................................. 731,319
Undivided profits and capital
reserves ............................................................... 3,093,726
Net unrealized holding gains
(losses) on available-for-sale
securities ............................................................. 36,866
Cumulative foreign currency transla-
tion adjustments ....................................................... (36,184)
-----------
Total equity capital ..................................................... 4,961,011
-----------
Total liabilities and equity
capital ................................................................ $56,153,587
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi )
Alan R. Griffith ) Directors
J. Carter Bacot )
---------------------------------
