<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 31, 1997
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
--------------------------
UNITED STATES CELLULAR CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 62-1147325
(State or other jurisdiction (I.R.S. Employer
of Identification
incorporation or organization) Number)
</TABLE>
8410 WEST BRYN MAWR AVE., SUITE 700
CHICAGO, ILLINOIS 60631
773-399-8900
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
H. DONALD NELSON WITH A COPY TO:
UNITED STATES CELLULAR CORPORATION WILBUR C. DELP, JR.
8410 WEST BRYN MAWR AVE., SUITE 700 SIDLEY & AUSTIN
CHICAGO, ILLINOIS 60631 ONE FIRST NATIONAL PLAZA
(773) 399-8900 CHICAGO, ILLINOIS 60603
(312) 853-7000
(Names, addresses, including zip codes, and telephone numbers,
including area code, of agents for service)
--------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
FROM TIME TO TIME AFTER THE 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 offered only in connection with dividend or interest
reinvestment plans, please check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
--------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED MAXIMUM
PROPOSED MAXIMUM AGGREGATE
TITLE OF EACH CLASS OF AMOUNT TO OFFERING PRICE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED BE REGISTERED PER UNIT(1)(2) PRICE(1)(2) REGISTRATION FEE
<S> <C> <C> <C> <C>
Debt Securities $400,000,000 100% $400,000,000 $121,213
</TABLE>
(1) If any Debt Securities are issued at an original issue discount, such
greater amount as shall result in an aggregate offering price to the public
which shall not exceed the amount set forth under Proposed Maximum Aggregate
Offering Price, or if Debt Securities are issued in a foreign or composite
currency, an equivalent amount of such foreign or composite currency.
(2) Estimated solely for the purpose of calculating the registration fee.
--------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL 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>
SUBJECT TO COMPLETION DATED JULY 31, 1997
PROSPECTUS
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.
<PAGE>
[LOGO]
UNITED STATES CELLULAR CORPORATION
$400,000,000
DEBT SECURITIES
----------------
United States Cellular Corporation ("USM") may from time to time offer
debentures, notes and/or other unsecured evidences of indebtedness (the "Debt
Securities") at an aggregate initial offering price not to exceed U.S.
$400,000,000 or its equivalent in any other currency or units based on or
relating to foreign currencies. The Debt Securities may be offered in one or
more series in amounts, at prices and on terms to be determined at the time of
sale. The accompanying Prospectus Supplement sets forth with regard to the
series of Debt Securities in respect of which this Prospectus is being delivered
(the "Offered Securities") the specific designation, aggregate principal amount,
original issue discount, if any, denomination (which may be in United States
dollars, in any other currency or in units based on or relating to foreign
currencies), maturity, interest rate (which may be fixed or variable) and time
of payment of interest, if any, any terms for redemption at the option of USM or
the holder, any terms for sinking fund payments, any listing on a securities
exchange, the initial public offering price and any other terms in connection
with the offering and sale of the Offered Securities.
The Debt Securities may be issued in registered form, in bearer form with
coupons attached or both. In addition, all or a portion of the Debt Securities
of any series may be issuable in temporary or permanent registered global form
which will be exchangeable only under certain conditions for definitive Debt
Securities.
USM may sell Debt Securities to or through underwriters or dealers, and also
may sell Debt Securities to other purchasers directly or through agents. The
accompanying Prospectus Supplement sets forth the names of any underwriters,
dealers or agents involved in the sale of the Offered Securities, the principal
amounts, if any, to be purchased by underwriters and the compensation of such
underwriters, dealers or agents. See "Plan of Distribution."
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
This Prospectus may not be used to consummate sales of Debt Securities
unless accompanied by a Prospectus Supplement applicable to the Offered
Securities.
------------------------
The date of this Prospectus is August , 1997.
<PAGE>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS, OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE IN THIS
PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. NEITHER
THIS PROSPECTUS NOR ANY PROSPECTUS SUPPLEMENT CONSTITUTES AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE REGISTERED
SECURITIES TO WHICH IT RELATES OR AN OFFER TO SELL OR THE SOLICITATION OF AN
OFFER TO BUY SUCH SECURITIES TO ANY PERSON IN ANY JURISDICTION TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION. NEITHER THE
DELIVERY OF THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
AVAILABLE INFORMATION
USM is subject to the informational requirements of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files
reports, proxy statements and other information with the Securities and Exchange
Commission (the "Commission"). Such reports, proxy statements and other
information can be inspected and copied at the public reference facilities of
the Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549; New
York Regional Office, Public Reference Room, 7 World Trade Center, 13th Floor,
New York, New York 10048; and Chicago Regional Office, Suite 1400, 500 West
Madison Street, Chicago, Illinois 60661. Copies of such material can be obtained
from the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. USM's Common Shares are listed on
the American Stock Exchange, and reports, proxy statements and other information
concerning USM may be inspected at the office of the American Stock Exchange,
Inc., 86 Trinity Place, New York, New York 10006. The Company is subject to the
electronic filing requirements of the Commission. Accordingly, pursuant to the
rules and regulations of the Commission, certain documents, including annual and
quarterly reports and proxy statements, filed by the Company with the Commission
have been and will be filed electronically. The Commission maintains a Web site
at http://www.sec.gov containing reports, proxy and information statements and
other information regarding registrants, including the Company, that file
electronically with the Commission.
This Prospectus constitutes a part of a Registration Statement filed by USM
with the Commission under the Securities Act of 1933, as amended (the
"Securities Act"). This Prospectus omits certain of the information contained in
the Registration Statement in accordance with the rules and regulations of the
Commission. Reference is hereby made to the Registration Statement and related
exhibits for further information with respect to USM and the Debt Securities.
The Registration Statement and any amendments thereto, including exhibits filed
as a part thereof, are available for inspection and copying as set forth above.
Statements contained herein concerning the provisions of any document are not
necessarily complete and, in each instance, reference is made to the copy of
such document filed as an exhibit to the Registration Statement or otherwise
filed with the Commission. Each such statement is qualified in its entirety by
such reference.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents heretofore filed by USM with the Commission under
the Exchange Act are incorporated herein by reference: (a) the Company's Annual
Report on Form 10-K for the year ended December 31, 1996; (b) the Company's
Quarterly Report on Form 10-Q for the quarter ended March 31, 1997 and (c) the
Company's Current Report on Form 8-K dated February 4, 1997.
2
<PAGE>
All documents filed by USM pursuant to Sections 13(a), 13(c), 14 or 15(d) of
the Exchange Act after the date of this Prospectus and prior to the termination
of the offering made by this Prospectus shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of filing of
such documents. Any statement contained in a document incorporated by reference
herein shall be deemed to be modified or superseded for purposes hereof to the
extent that a statement contained herein (or in any other subsequently filed
document which also is incorporated by reference herein) modifies or supersedes
such statement. Any statement so modified or superseded shall not be deemed to
constitute a part hereof except as so modified or superseded. All information
appearing in this Prospectus is qualified in its entirety by the information and
financial statements (including notes thereto) appearing in the documents
incorporated herein by reference.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT PRESENTED
HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS (OTHER THAN EXHIBITS THERETO) ARE
AVAILABLE WITHOUT CHARGE, UPON WRITTEN OR ORAL REQUEST BY ANY PERSON TO WHOM
THIS PROSPECTUS HAS BEEN DELIVERED, FROM EXTERNAL REPORTING, UNITED STATES
CELLULAR CORPORATION, 8410 WEST BRYN MAWR AVENUE, SUITE 700, CHICAGO, ILLINOIS
60631 (TELEPHONE 773-399-8900).
This Prospectus and the accompanying Prospectus Supplement contain
"forward-looking" statements as defined in the Private Securities Litigation
Reform Act of 1995, that are based on current expectations, estimates and
projections. Statements that are not historical facts, including statements
about the Company's beliefs and expectations, are forward-looking statements.
These statements contain potential risks and uncertainties; therefore, actual
results may differ materially. The Company undertakes no obligation to update
publicly any forward-looking statements whether as a result of new information,
future events or otherwise.
Important factors that may affect these projections or expectations include,
but are not limited to: changes in the overall economy; changes in competition
in markets in which the Company operates; advances in telecommunications
technology; changes in the telecommunications regulatory environment; pending
and future litigation; availability of future financing; start-up of Personal
Communications Services operations; and unanticipated changes in growth in
cellular customers, penetration rates, churn rates and the mix of products and
services offered in the Company's markets. Readers should evaluate any
statements in light of these important factors.
THE COMPANY
United States Cellular Corporation and its subsidiaries (the "Company") own,
operate and invest in cellular telephone systems throughout the United States.
The Company's managed markets are operated as market clusters, which have been
developed over a period of several years, primarily through acquisitions and
exchanges for controlling interests in cellular markets. The Company seeks to
position itself as the first choice of consumers for wireless communications in
the mid-sized and rural markets it serves. The Company's objectives are to grow
revenues and maximize long-term profitability by increasing market penetration
and by capitalizing on the benefits of its clustered markets.
The Company was incorporated in Delaware in 1983 and is a majority owned
subsidiary of Telephone and Data Systems, Inc. ("TDS"). Its executive offices
are located at 8410 West Bryn Mawr Avenue, Suite 700, Chicago, Illinois 60631.
Its telephone number is 773-399-8900.
USE OF PROCEEDS
Unless otherwise specified in the applicable Prospectus Supplement, the
Company intends to use the net proceeds from the sale of the Debt Securities for
general corporate purposes, including working capital, the repayment or
refinancing of indebtedness, future acquisitions and/or capital expenditures.
Pending application of the net proceeds for specific purposes, such proceeds may
be invested in short-term or marketable securities.
3
<PAGE>
CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the historical ratios of earnings to fixed
charges for the Company for the three months ended March 31, 1997 and for each
of the years ended December 31, 1992 through 1996.
<TABLE>
<CAPTION>
(UNAUDITED) THREE YEAR ENDED DECEMBER 31,
MONTHS ENDED MARCH -----------------------------------------------------
31, 1997 1996 1995 1994 1993 1992
- ------------------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
3.84x 8.81x 4.30x 1.49x .17x 1.24x
</TABLE>
For purposes of calculating this ratio, earnings consist of net income from
continuing operations before income taxes, distributions from minority
subsidiaries, minority share in income of subsidiaries that have fixed charges
and amortization of capitalized interest, less equity in undistributed earnings
of unconsolidated investments, and minority share of losses. Fixed charges
consist of interest expense and estimated interest portion of rentals.
DESCRIPTION OF DEBT SECURITIES
The Debt Securities will be issued under an Indenture dated as of July 31,
1997 (the "Indenture") between USM and The First National Bank of Chicago, as
Trustee (the "Trustee"), the form of which is incorporated by reference as an
exhibit to the Registration Statement of which this Prospectus is a part. The
following statements with respect to the Indenture and the Securities (as
hereinafter defined) are brief summaries of certain provisions of the Indenture
and do not purport to be complete; such statements are subject to the detailed
referenced provisions of the Indenture, including the definitions of capitalized
terms used under this caption. Wherever particular sections or defined terms of
the 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. The term "Securities", as used
under this caption, refers to all securities issued under the Indenture,
including the Debt Securities. References to "USM" in this section, unless the
context indicates otherwise, are to United States Cellular Corporation and not
its subsidiaries or any other entities in which it holds an interest.
GENERAL
The Indenture does not limit the aggregate principal amount of Securities
(which may include debentures, notes and other unsecured evidences of
indebtedness) which may be issued thereunder, and Securities may be issued
thereunder from time to time in one or more series and may be denominated and
payable in foreign currencies or units based on or relating to foreign
currencies, including European Currency Units. Special United States federal
income tax considerations applicable to any Securities so denominated will be
described in the Prospectus Supplement relating thereto. Unless otherwise
indicated in the applicable Prospectus Supplement, the Indenture also permits
USM to increase the principal amount of any series of Securities previously
issued and to issue such increased principal amount. (Section 2.3)
The Prospectus Supplement will set forth the following terms relating to the
Offered Securities: (1) the specific designation of the Offered Securities; (2)
any limit on the aggregate principal amount of the Offered Securities; (3) the
date or dates, if any, on which the Offered Securities will mature; (4) the rate
or rates per annum (which may be fixed or variable) at which the Offered
Securities will bear interest, if any, the date or dates on which any such
interest will be payable and the Record Dates for any interest payable on the
Offered Securities which are Registered Securities; (5) original issue discount,
if any; (6) any mandatory or optional redemption or sinking fund provisions,
including the period or periods within which, the price or prices at which and
the terms and conditions upon which the Offered Securities may be redeemed or
purchased at the option of USM or otherwise; (7) whether the Offered Securities
will be issuable in registered form or bearer form or both, and, if issuable in
bearer form, the restrictions as to the offer, sale and delivery of the Offered
Securities in bearer form and as to exchanges between registered
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<PAGE>
and bearer form; (8) whether the Offered Securities will be issuable in the form
of one or more temporary or permanent Global Securities and, if so, the identity
of the Depositary for such Global Securities; (9) the denominations of $1,000
and any multiple thereof, and the denominations in which any of the Offered
Securities which are in bearer form will be issuable, if other than the
denominations of $1,000 and $5,000; (10) each office or agency where the
principal of and any premium and interest on the Offered Securities will be
payable, and each office or agency where the Offered Securities may be presented
for registration of transfer or exchange; (11) if other than United States
dollars, the foreign currency or the units based on or relating to foreign
currencies in which the Offered Securities are denominated and/or in which the
payment of the principal of and any premium and interest on the Offered
Securities will or may be payable; (12) certain United States federal income tax
consequences, if applicable; and (13) any other terms of the Offered Securities
(which terms shall not adversely affect the interests of any Holders of
Securities then Outstanding), including additions to or deletions from the
covenants and events of default with respect to the Offered Securities.
Securities may be issued under the Indenture bearing no interest or interest
at a rate below the prevailing market rate at the time of issuance, to be
offered and sold at a discount below their stated principal amount. United
States federal income tax consequences and other special considerations
applicable to any such discounted Securities or to other Securities offered and
sold at par which are treated as having been issued at a discount for United
States federal income tax purposes will be described in the Prospectus
Supplement relating thereto.
The Securities and any coupons appertaining thereto will be unsecured and
will rank PARI PASSU with all other unsecured and unsubordinated indebtedness of
USM. However, since USM is a holding company, the right of USM, and hence the
right of the creditors of USM (including the Holders of Securities), to
participate in any distribution of the assets of any subsidiary upon its
liquidation or reorganization or otherwise is necessarily subject to the prior
claims of creditors of such subsidiary, except to the extent that claims of USM
as a creditor of such subsidiary may be recognized. There is no restriction in
the Indenture against subsidiaries of USM incurring secured or unsecured
indebtedness or issuing secured or unsecured securities. The ability of USM to
make payments of principal and interest on the Debt Securities will be dependent
upon the payment to it by its subsidiaries of dividends, distributions, loans or
advances.
The Indenture does not contain covenants or other provisions designed to
afford Holders of Securities protection in the event of a highly leveraged
transaction, change in credit rating or other similar occurrence.
EXCHANGE AND TRANSFER
Securities may be presented for exchange and registered Securities may be
presented for registration of transfer at the offices, and subject to the
restrictions, set forth therein and in the applicable Prospectus Supplement
without service charge, but upon payment of any taxes or other governmental
charges due in connection therewith, subject to any applicable limitations
contained in the Indenture. USM has appointed the Trustee as Security Registrar.
Securities in bearer form and the coupons appertaining thereto, if any, will be
transferable by delivery. (Sections 2.8 and 3.2)
PAYMENT
Unless otherwise indicated in the applicable Prospectus Supplement, payment
of the principal of and the premium and interest, if any, on all Securities
(other than a Registered Global Security) in registered form will be made at the
office or agency of the Trustee in the Borough of Manhattan, The City of New
York, except that, at the option of USM, payment of any interest may be made (i)
by check mailed to the address of the Person entitled thereto as such address
shall appear in the Security Register or (ii) by wire transfer to an account
maintained by the Person entitled thereto as specified in the Security Register.
(Sections 3.1 and 3.2) Unless otherwise indicated in the applicable Prospectus
Supplement, payment of any
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<PAGE>
interest due on Securities in registered form will be made to the Persons in
whose name such Registered Securities are registered at the close of business on
the Record Date for such interest payments. (Section 2.7)
REGISTERED GLOBAL SECURITIES
The registered Securities of a particular series may be issued in the form
of one or more Registered Global Securities which will be deposited with a
Depositary, or its nominee, each of which will be identified in the Prospectus
Supplement relating to such series. Unless and until exchanged, in whole or in
part, for Securities in definitive registered form, a Registered Global Security
may not be transferred except as a whole by the Depositary for such Registered
Global Security to a nominee of such Depositary, by a nominee of such Depositary
to such Depositary or another nominee of such Depositary or by such Depositary
or any such nominee to a successor of such Depositary or a nominee of such
successor. (Section 2.8)
The specific terms of the depositary arrangement with respect to any portion
of a particular series of Securities to be represented by a Registered Global
Security will be described in the Prospectus Supplement relating to such series.
USM anticipates that the following provisions will apply to all depositary
arrangements:
Upon the issuance of a Registered Global Security, the Depositary therefor
or its nominee will credit, on its book entry and registration system, the
respective principal amounts of the Securities represented by such Registered
Global Security to the accounts of such persons having accounts with such
Depositary ("participants") as shall be designated by the underwriters or agents
participating in the distribution of such Securities or by USM if such
Securities are offered and sold directly by USM. Ownership of beneficial
interests in a Registered Global Security will be limited to participants or
persons that may hold beneficial interests through participants. Ownership of
beneficial interests in a Registered Global Security will be shown on, and the
transfer of such ownership will be effected only through, records maintained by
the Depositary therefor or its nominee (with respect to beneficial interests of
participants) or by participants or persons that hold through participants (with
respect to interests of persons other than participants). The laws of some
states require certain purchasers of securities to take physical delivery
thereof in definitive form. Such depositary arrangements and such laws may
impair the ability to transfer beneficial interests in a Registered Global
Security.
So long as the Depositary for a Registered Global Security or its nominee is
the registered owner thereof, such Depositary or such nominee, as the case may
be, will be considered the sole owner or Holder of the Securities represented by
such Registered Global Security for all purposes under the Indenture. Except as
provided below, owners of beneficial interests in a Registered Global Security
will not be entitled to have Securities of the series represented by such
Registered Global Security registered in their names, will not receive or be
entitled to receive physical delivery of Securities of such series in definitive
form and will not be considered the owners or Holders thereof under the
Indenture.
Principal, premium, if any, and interest payments on a Registered Global
Security registered in the name of a Depositary or its nominee will be made to
such Depositary or nominee, as the case may be, as the registered owner of such
Registered Global Security. None of USM, the Trustee or any paying agent for
Securities of the series represented by such Registered Global Security will
have any responsibility or liability for any aspect of the records relating to
or payments made on account of beneficial interests in such Registered Global
Security or for maintaining, supervising or reviewing any records relating to
such beneficial interests.
6
<PAGE>
USM expects that the Depositary for a Registered Global Security or its
nominee, upon receipt of any payment of principal, premium or interest, will
immediately credit participants' accounts with payments in amounts proportionate
to their respective beneficial interests in the principal amounts of such
Registered Global Security as shown on the records of such Depositary or its
nominee. USM also expects that payments by participants to owners of beneficial
interests in such Registered Global Security held through such participants will
be governed by standing instructions and customary practices, as is now the case
with securities held for the accounts of customers registered in "street name",
and will be the responsibility of such participants.
If the Depositary for a Registered Global Security representing Securities
of a particular series is at any time unwilling or unable to continue as
Depositary and a successor Depositary is not appointed by USM within 90 days,
USM will issue Securities of such series in definitive form in exchange for such
Registered Global Security. In addition, USM may at any time and in its sole
discretion determine not to have the Securities of a particular series
represented by one or more Registered Global Securities and, in such event, will
issue Securities of such series in definitive form in exchange for all of the
Registered Global Securities representing Securities of such series.
CERTAIN COVENANTS OF USM
Under the Indenture, USM has agreed that it will not engage in certain
transactions, as described below.
LIMITATION ON SECURED DEBT. USM will not create or incur any Secured Debt
without in either case effectively providing that Debt Securities (together
with, if USM shall so determine, any other Debt of or guaranteed by USM ranking
equally with the Debt Securities) shall be secured equally and ratably with (or,
at the option of USM, prior to) such Secured Debt, with certain stated
exceptions. These exceptions permit (a) Secured Debt (i) in respect of Liens on
property existing at the time such property is acquired by USM, (ii) in respect
of Liens created upon or within 270 days following the acquisition or
construction of property (including any improvements to existing property) to
secure the payment of all or part of the purchase price thereof, or (iii)
incurred by USM prior to, at the time of or within 270 days following the
acquisition of property which is subject to a related Lien, which Secured Debt
is incurred for the purpose of financing all or part of the purchase price
thereof, provided that no such Lien applies to any property theretofore owned by
USM (including property transferred by USM to any subsidiary of USM in
contemplation of or in connection with the creation of such Lien) or to any
property of USM other than the property so acquired (other than, in the case of
construction or improvement, any theretofore unimproved real property or portion
thereof on which the property so constructed, or the improvement, is located);
(b) Secured Debt in respect of Liens on property of a Person (i) existing at the
time such Person is merged into or consolidated with USM or at the time of a
sale, lease or other disposition of the properties of a Person as an entirety or
substantially as an entirety to USM, (ii) resulting from such merger,
consolidation, sale, lease or disposition by virtue of any Lien on property
granted by USM prior to such merger, consolidation, sale, lease or disposition
(and not in contemplation thereof or in connection therewith) which applies to
after-acquired property of USM or (iii) resulting from such merger,
consolidation, sale, lease or disposition pursuant to a Lien or contractual
provision granted or entered into by such Person prior to such merger,
consolidation, sale, lease or disposition (and not at the request of USM);
PROVIDED, HOWEVER, that any such Lien referred to in clause (i) shall not apply
to any property of USM other than the property subject thereto at the time such
Person or properties were acquired and any such Lien referred to in clause (ii)
or (iii) shall not apply to any property of USM other than the property so
acquired; (c) Liens existing at the date of the Indenture; (d) Liens in favor of
a government or governmental entity to secure partial progress, advance or other
payments, or other obligations, or to secure any Debt incurred for the purpose
of financing all or any part of the cost of acquiring, constructing or improving
the property subject thereto (including, without limitation, Liens incurred in
connection with industrial revenue, pollution control, private activity bond or
similar financing); (e) Liens arising by reason
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of deposits with, or the giving of any form of security to, any governmental
agency or any body created or approved by law or governmental regulation, which
Lien is required by law or governmental regulation as a condition to the
transaction of any business or the exercise of any privilege, franchise, license
or permit; (f) Liens for taxes, assessments or governmental charges or levies
not yet delinquent or governmental charges or levies already delinquent, the
validity of which charge or levy is being contested in good faith and for which
any reserves required in accordance with generally accepted accounting
principles have been established; (g) Liens (including judgment liens) arising
in connection with legal proceedings so long as such proceedings are being
contested in good faith and, in the case of judgment liens, execution thereon is
stayed and for which any reserves required in accordance with generally accepted
accounting principles have been established; and (h) Secured Debt secured by any
extension, renewal or replacement (or successive extensions, renewals or
replacements) of any Liens referred to in the foregoing clauses (a) to (g),
inclusive (provided that the principal amount of Secured Debt secured thereby
does not exceed the principal amount of such Debt immediately prior to such
extension, renewal or replacement, and that any Lien created in connection
therewith is limited to all or part of the property (plus improvements to such
property) which secured the Secured Debt so extended, renewed or replaced).
(Section 3.6)
The foregoing restrictions do not apply if, immediately after the incurrence
of such Secured Debt (giving effect to the application of the proceeds
therefrom), the aggregate principal amount of Secured Debt (other than Secured
Debt described in clauses (a) to (h), inclusive, of the immediately preceding
paragraph), plus the aggregate amount of Capitalized Rent in respect of Sale and
Leaseback Transactions (other than Sale and Leaseback Transactions the proceeds
of which are or will be applied as described in clauses (a) to (e) inclusive,
under "Limitation on Sale and Leaseback Transactions" below), would not exceed
10% of Consolidated Capitalization. (Sections 1.1 and 3.6)
LIMITATION ON SALE AND LEASEBACK TRANSACTIONS. USM will not enter into any
Sale and Leaseback Transaction unless immediately after the completion of such
Sale and Leaseback Transaction (giving effect to the application of the proceeds
therefrom), the aggregate amount of Capitalized Rent in respect of Sale and
Leaseback Transactions (other than Sale and Leaseback Transactions described in
clauses (a) to (e), inclusive, of the immediately succeeding paragraph), plus
the aggregate principal amount of Secured Debt (other than Secured Debt
described in clauses (a) to (h), inclusive, under "Limitation on Secured Debt"
above), would not exceed 10% of Consolidated Capitalization. (Section 3.7)
The foregoing restrictions do not apply to, and there shall be excluded in
computing the aggregate amount of Capitalized Rent for the purpose of such
restrictions, the following Sale and Leaseback Transactions: (a) any Sale and
Leaseback Transaction entered into to finance the payment of all or any part of
the purchase price of property acquired or constructed by USM (including any
improvements to existing property) or entered into prior to, at the time of or
within 270 days after the acquisition or construction of such property, which
Sale and Leaseback Transaction is entered into for the purpose of financing all
or part of the purchase or construction price thereof; PROVIDED, HOWEVER, that
in the case of any such acquisition, such Sale and Leaseback Transaction shall
not involve any property transferred by USM to a subsidiary thereof in
contemplation of or in connection with such Sale and Leaseback Transaction or
involve any property of USM other than the property so acquired (other than, in
the case of construction or improvement, any theretofore unimproved real
property or portion thereof on which the property so constructed, or the
improvement, is located); (b) any Sale and Leaseback Transaction involving
property of a Person existing at the time such Person is merged into or
consolidated with USM or at the time of a sale, lease or other disposition of
the properties of a Person as an entirety or substantially as an entirety to
USM; (c) any Sale and Leaseback Transaction in which the lessor is a government
or governmental entity and which Sale and Leaseback Transaction is entered into
to secure partial progress, advance or other payments, or other obligations,
pursuant to any contract or statute or to secure any Debt incurred for the
purpose of financing all or any part of the cost of constructing or improving
the property subject to such Sale and Leaseback Transaction (including, without
limitation, Sale and Leaseback Transactions incurred in connection with
pollution control, industrial revenue, private activity bond or similar
financing); (d) any
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Sale and Leaseback Transaction involving the extension, renewal or replacement
(or successive extensions, renewals or replacements) in whole or in part of a
lease pursuant to a Sale and Leaseback Transaction referred to in the foregoing
clauses (a) to (c), inclusive; PROVIDED, HOWEVER, that such lease extension,
renewal or replacement shall be limited to all or any part of the same property
leased under the lease so extended, renewed or replaced (plus improvements to
such property); and (e) any Sale and Leaseback Transaction the net proceeds of
which are at least equal to the fair value (as determined by the Board of
Directors of USM) of the property leased pursuant to such Sale and Leaseback
Transaction, so long as within 270 days of the effective date of such Sale and
Leaseback Transaction, USM applies (or irrevocably commits to an escrow account
for the purpose or purposes hereinafter mentioned) an amount equal to the net
proceeds of such Sale and Leaseback Transaction to either (x) the purchase of
other property having a fair value at least equal to the fair value of the
property leased in such Sale and Leaseback Transaction and having a similar
utility and function, or (y) the retirement or repayment (other than any
mandatory retirement or repayment at maturity) of (i) Securities, (ii) other
Funded Debt of USM which ranks prior to or on a parity with the Securities or
(iii) indebtedness of any subsidiary of USM maturing by its terms more than one
year from its date of issuance (notwithstanding that any portion of such
indebtedness is included in current liabilities) or preferred stock of any
subsidiary of USM (other than any such indebtedness owed to or preferred stock
owned by USM or any subsidiary of USM); PROVIDED, HOWEVER, that in lieu of
applying an amount equivalent to all or any part of such net proceeds to such
retirement or repayment (or committing such an amount to an escrow account for
such purpose), USM may deliver to the Trustee Outstanding Securities and thereby
reduce the amount to be applied pursuant to (y) of this clause (e) by an amount
equivalent to the aggregate principal amount of the Securities so delivered.
(Section 3.7)
CERTAIN DEFINITIONS
"CAPITAL STOCK" means and includes any and all shares, interests,
participations or other equivalents (however designated) of ownership in a
corporation or other Person.
"CAPITALIZATION" means with respect to a Person the total of (a) Funded
Debt, (b) the par value or, in the case of Capital Stock with no par value, a
value stated on the books, of all outstanding shares of Capital Stock, (c) the
paid-in surplus and retained earnings (or minus the net surplus deficit, as the
case may be), (d) deferred taxes and deferred investment tax credits, (e)
Capitalized Rent, and (f) minority interests in subsidiaries of such Person.
"CAPITALIZED RENT" means the present value (discounted semi-annually at a
discount rate equal to the weighted average rate of interest borne by the Debt
Securities then Outstanding) of the total net amount of rent payable for the
remaining term of any lease of property by USM (including any period for which
such lease has been extended); PROVIDED, HOWEVER, that no such rental obligation
shall be deemed to be Capitalized Rent unless the lease resulted from a Sale and
Leaseback Transaction. The total net amount of rent payable under any lease for
any period shall be the total amount of the rent payable by the lessee with
respect to such period but shall not include amounts required to be paid on
account of maintenance and repairs, insurance, taxes, assessments, water rates,
sewer rates and similar charges.
"CONSOLIDATED CAPITALIZATION" means the Capitalization of USM and its
Subsidiaries determined on a consolidated basis at the end of USM's then most
recently reported fiscal year or quarter, as the case may be.
"DEBT" means with respect to a Person all obligations of such Person for
borrowed money and all such obligations of any other Person for borrowed money
guaranteed by such Person.
"FUNDED DEBT" means any Debt maturing by its terms more than one year from
its date of issuance (notwithstanding that any portion of such Debt is included
in current liabilities).
"LIEN" means any mortgage, pledge, security interest, lien, charge or other
encumbrance.
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"OUTSTANDING" means, subject to certain exceptions, all Debt Securities
issued under the Indenture, except those theretofore cancelled by the Trustee or
delivered to it for cancellation, defeased in accordance with the Indenture,
paid in full, or in respect of which substitute Debt Securities have been
authenticated and delivered by the Trustee.
"PERSON" means any individual, corporation, partnership, limited liability
company, joint venture, joint-stock company, trust, unincorporated organization
or government or any agency or political subdivision thereof.
"PROPERTY" means any directly-held interest of a Person in any kind of
property or asset, whether real, personal or mixed and whether tangible or
intangible, and includes Capital Stock of a subsidiary or other Person.
"SALE AND LEASEBACK TRANSACTION" means any arrangement with any Person other
than a Tax Consolidated Subsidiary providing for the leasing (as lessee) by USM
of any property (except for temporary leases for a term, including any renewal
thereof, of not more than three years (provided that any such temporary lease
may be for a term of up to five years if (a) the Board of Directors of USM
reasonably finds such term to be in the best interest of USM and (b) the primary
purpose of the transaction of which such lease is a part is not to provide funds
to or financing for USM)), which property has been or is to be sold or
transferred by USM (i) to any subsidiary of USM in contemplation of or in
connection with such arrangement or (ii) to such other Person.
"SECURED DEBT" means Debt of USM secured by any Lien on property (including
Capital Stock or indebtedness of subsidiaries of USM) owned by USM.
"SUBSIDIARY" means a Person which is consolidated with USM in accordance
with generally accepted accounting principles.
"TAX CONSOLIDATED SUBSIDIARY" means a subsidiary of USM with which, at the
time a Sale and Leaseback Transaction is entered into by USM, USM would be
entitled to file a consolidated federal income tax return.
EVENTS OF DEFAULT
The occurrence of any of the following events with respect to the Securities
of any series will constitute an "Event of Default" with respect to the
Securities of such series: (a) default for 30 days in the payment of any
interest on any of the Securities of such series; (b) default in the payment of
any of the principal of or the premium, if any, on any of the Securities of such
series, whether at maturity, upon redemption, by declaration or otherwise; (c)
default in the deposit of any sinking fund payment in respect of any Securities
of such series; (d) default for 90 days by USM in the observance or performance
of any other covenant or agreement contained in the Indenture relating to the
Securities of such series after written notice thereof as provided in the
Indenture; (e) (i) an event of default occurs under any instrument under which
there is outstanding, or by which there may be secured or evidenced, any
indebtedness of USM for money borrowed (other than non-recourse indebtedness)
which results in acceleration of, or non-payment at maturity (after giving
effect to any applicable grace period) of such indebtedness in an aggregate
amount exceeding the greater of $30,000,000 or 2% of Consolidated
Capitalization, in which case USM shall immediately give notice to the Trustee
of such acceleration or non-payment, and (ii) there shall have been a failure to
cure such default or to discharge such indebtedness within ten days after notice
thereof to USM by the Trustee or to USM and the Trustee by the Holders of at
least 25% in aggregate principal amount of the Securities then Outstanding;
PROVIDED that no such Event of Default described in this clause (e) shall exist
as long as USM is contesting any such default or acceleration in good faith and
by appropriate proceedings; or (f) certain events of bankruptcy, insolvency or
reorganization relating to USM. (Section 5.1) Different Events of Default may be
prescribed for the benefit of the Holders of a particular series of Securities
and will be described in the Prospectus Supplement relating thereto.
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If an Event of Default due to a default in the payment of the principal of
or the premium or interest, if any, on, or in the deposit of any sinking fund
payment with respect to, any series of Securities shall have occurred and be
continuing, either the Trustee or the Holders of not less than 25% in aggregate
principal amount of the Securities of such series then Outstanding may declare
the principal of all Securities of such series and the interest, if any, accrued
thereon to be due and payable immediately. If an Event of Default due to a
default in the observance or performance of any other covenant or agreement of
USM contained in the Indenture and applicable to the Securities of one or more
(but less than all) series then Outstanding shall have occurred and be
continuing, either the Trustee or the Holders of not less than 25% in aggregate
principal amount of the Securities of the affected series then Outstanding
(voting as one class) may declare the principal of all Securities of each such
affected series and the interest, if any, accrued thereon to be due and payable
immediately. If an Event of Default due to a default in the observance or
performance of any other covenant or agreement of USM contained in the Indenture
applicable to all Securities then Outstanding or due to the acceleration or
non-payment at maturity of certain indebtedness of USM shall have occurred and
be continuing, either the Trustee or the Holders of not less than 25% in
aggregate principal amount of all Securities then Outstanding (voting as one
class) may declare the principal of all Securities and the interest, if any,
accrued thereon to be due and payable immediately. If an Event of Default due to
certain acts of bankruptcy, insolvency or reorganization of USM shall have
occurred and be continuing, the principal and interest on all the Securities
then Outstanding shall thereby become and be immediately due and payable without
any declaration or other act on the part of the Trustee or any Securityholders.
Upon certain conditions, any such declarations may be rescinded and annulled if
all Events of Default, other than the nonpayment of accelerated principal, with
respect to the Securities of all such affected series then Outstanding shall
have been cured or waived as provided in the Indenture by the Holders of a
majority in aggregate principal amount of the Securities of the affected series
then Outstanding (voting as one class, except in the case of Events of Default
described in clauses (a), (b) and (c) of the preceding paragraph, as to which
each series so affected will vote as a separate class). See "Modification of the
Indenture" below. Reference is made to the Prospectus Supplement relating to any
series of Original Issue Discount Securities for the particular provisions
relating to the acceleration of a portion of the principal amount thereof upon
the occurrence and continuance of an Event of Default with respect thereto.
(Section 5.1)
The Indenture provides that, subject to the duty of the Trustee to act with
the requisite standard of care, in case a default with respect to a series of
Securities shall have occurred and be continuing, the Trustee will be under no
obligation to exercise any of its rights or powers under the Indenture at the
request, order or direction of the Holders of the Securities, unless such
Holders shall have offered to the Trustee reasonable indemnity. (Sections 5.6
and 6.2) Subject to such provisions for indemnity and certain other limitations
contained in the Indenture, the Holders of a majority in aggregate principal
amount of the Securities of each affected series then Outstanding will have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred on
the Trustee, with respect to the Securities of such affected series. (Section
5.9)
The Indenture provides that no Holder of Securities may institute any action
against USM under the Indenture (except actions for payment of overdue
principal, premium or interest) unless such Holder previously shall have given
to the Trustee written notice of default and continuance thereof and unless the
Holders of not less than 25% in aggregate principal amount of the Securities of
the affected series then Outstanding (voting as one class) shall have requested
the Trustee to institute such action and shall have offered the Trustee
reasonable indemnity, the Trustee shall not have instituted such action within
60 days of such request and the Trustee shall not have received direction
inconsistent with such request by the Holders of a majority in aggregate
principal amount of the Securities of the affected series then Outstanding
(voting as one class). (Sections 5.6 and 5.9)
The Indenture requires USM to furnish to the Trustee annually a statement as
to the performance of USM's covenants under the Indenture. (Section 3.5) The
Indenture provides that the Trustee may withhold
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notice to the Holders of the Securities of any series of any default affecting
such series (except defaults as to payment of principal, premium or interest on
the Securities of such series or as to sinking fund payments) if it considers
such withholding to be in the interests of the Holders of the Securities of such
series. (Section 5.11)
CONSOLIDATION, MERGER OR SALE OF ASSETS
USM may consolidate with or merge into, or sell, lease or convey its
property as an entirety or substantially as an entirety to, any other entity if
(a) such entity assumes the obligations of USM under the Securities and the
Indenture; (b)(i) such entity is organized and existing under the laws of the
United States or any state thereof or the District of Columbia; or (ii) such
entity is organized and existing under the laws of Canada, Japan, Australia, New
Zealand, or certain specified European nations, or any political subdivision of
any thereof and such entity undertakes to pay to the Holders of Securities any
additional amounts as may be necessary in order that every net payment of
principal of and interest, if any, on the Securities, after withholding for or
on account of any present or future tax, assessment or governmental charge
imposed upon such Holder (except for a tax, assessment or charge imposed solely
as a result of a connection between the recipient and the jurisdiction imposing
such tax, assessment or charge) by reason of or as a result of such payment
being made by an entity which is not an entity existing under the laws of the
United States or any state thereof or the District of Columbia, will not be less
than the amount provided for in the Securities to be then due and payable; (c)
upon request by the Trustee, USM delivers to the Trustee certain certificates
and opinions specified in the Indenture; (d) immediately after giving effect to
such transaction (and treating any Secured Debt or Sale and Leaseback
Transaction which becomes an obligation of the resulting, surviving or
transferee Person as a result of such transaction as having been incurred or
entered into by such Person at the time of such transaction), no Event of
Default (or event which, after notice or lapse of time or both, would be an
Event of Default) shall exist and (e) upon such consolidation, merger, sale,
lease or conveyance any property owned by USM immediately prior thereto would
become subject to any Lien (unless such Lien would be permitted by the
provisions described above under "Limitation on Secured Debt"), the Securities
must be secured (together with, if USM shall so determine, any other Debt
ranking equally with or prior to the Securities incurred, assumed or guaranteed
by USM, whether then or thereafter existing) by a direct Lien on such property
prior to all Liens other than any theretofore existing thereon. (Sections 9.1
and 9.2). The covenant phrase "substantially as an entirety" is not defined in
the Indenture, and USM is unaware of an established meaning or quantification of
the phrase under Illinois law, which is the law governing construction of the
Indenture. A Holder may bear the burden of establishing the meaning of the
phrase "substantially as an entirety."
MODIFICATION OF THE INDENTURE
The Indenture permits USM and the Trustee to enter into supplemental
indentures without the consent of the Holders of the Securities to: (a) subject
to compliance with USM's covenants described above under "Certain Covenants of
USM--Limitation on Secured Debt", secure the Securities of one or more series,
(b) add guarantees with respect to the Securities of one or more series, (c)
evidence the assumption by a successor Person of the obligations of USM under
the Indenture and the Securities then Outstanding, (d) add covenants for the
protection of the Holders of the Securities, (e) cure any ambiguity or correct
any inconsistency in the Indenture, provided that no such action shall adversely
affect the interests of the Holders of the Securities of any series, (f)
establish the form and terms of the Securities of any series, (g) evidence the
acceptance of appointment by a successor Trustee, (h) subject to compliance with
certain requirements of the Indenture, provide for uncertificated Securities in
addition to or in place of certificated Securities and (i) comply with any
requirements of the Commission in connection with qualifying the Indenture under
the Trust Indenture Act of 1939, as amended. (Section 8.1)
The Indenture also permits USM and the Trustee, with the consent of the
Holders of not less than a majority in aggregate principal amount of the
Securities of all series then Outstanding and affected (voting
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as one class), to add any provisions to, or change in any manner or eliminate
any of the provisions of, the Indenture or modify in any manner the rights of
the Holders of the Securities of each such affected series; PROVIDED, HOWEVER,
that USM and the Trustee may not, without the consent of the Holder of each
Security then Outstanding and affected thereby: (a) extend the time of payment
of the principal (or any installment) of any Security, or reduce the principal
amount thereof, or reduce the rate, alter the method of computation of the rate
or extend the time of payment of interest thereon, or reduce any amount payable
on the redemption thereof, or change the currency in which the principal thereof
or the interest thereon is payable, or reduce the amount payable on any Original
Issue Discount Security upon acceleration or provable in bankruptcy, or alter
certain provisions of the Indenture relating to Securities not denominated in
United States dollars, or impair the right to institute suit for the enforcement
of any payment on any Security when due; or (b) reduce the percentage in
principal amount of the Securities of the affected series, the consent of whose
Holders is required for any such modification or for any waiver provided for in
the Indenture. (Section 8.2)
Prior to the acceleration of the maturity of any Securities, the Holders of
a majority in aggregate principal amount of the Securities of all series at the
time Outstanding with respect to which a default or an Event of Default shall
have occurred and be continuing (voting as one class) may on behalf of the
Holders of all such affected Securities waive any past default or Event of
Default and its consequences, except a default or an Event of Default in respect
of a covenant or provision of the Indenture or of any Security which cannot be
modified or amended without the consent of the Holder of each Security affected.
DEFEASANCE AND DISCHARGE
The Indenture provides that, at the option of USM, (a) USM will be
discharged from any and all obligations in respect of the Securities of a
particular series then Outstanding (except for certain obligations to register
the transfer of or exchange the Securities of such series, to replace stolen,
lost or mutilated Securities of such series, to maintain paying agencies, in the
event that the Trustee is not the Security Registrar, to furnish the Trustee
with the names and addresses of the Holders of Registered Securities of each
series, to cause any successor Person substituted for USM in accordance with the
Indenture to assume USM's obligations thereunder and with respect to the
Securities, to comply with certain covenants described under "Consolidation,
Merger or Sale of Assets" and to maintain the trust described below), or (b) USM
need not comply with certain covenants of the Indenture (including certain of
those described under "Certain Covenants of USM" and "Consolidation, Merger or
Sale of Assets"), in each case if USM irrevocably deposits in trust with the
Trustee money, and/or securities of the government which issued the currency in
which the Securities of such series are payable or securities backed by the full
faith and credit of such government which, through the payment of the principal
thereof and the interest thereon in accordance with their terms, will provide
money in an amount sufficient to pay all the principal of (and premium, if any)
and interest on the Securities of such series on the stated maturity of such
Securities in accordance with the terms thereof. To exercise such option, USM is
required, among other things, to deliver to the Trustee an opinion of
independent counsel of nationally recognized standing in matters of federal
income tax law to the effect that the exercise of such option would not cause
the Holders of the Securities of such series to recognize income, gain or loss
for United States federal income tax purposes as a result of such defeasance,
and such Holders will be subject to United States federal income tax on the same
amounts, in the same manner and at the same times as would have been the case if
such defeasance had not occurred, and, in the case of a discharge as described
in clause (a) of the preceding sentence, such opinion states that either (A)
there has been a change in the applicable federal income tax law to the
foregoing effect or (B) USM has received a private letter ruling from the
Internal Revenue Service or there has been published a revenue ruling to the
foregoing effect. (Section 10.1)
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In the event USM exercises its option to effect a covenant defeasance with
respect to the Securities of any series as described in the preceding paragraph
and the Securities of such series are thereafter declared due and payable
because of the occurrence of any Event of Default other than an Event of Default
caused by failing to comply with the covenants which are defeased, and the
amount of money and securities on deposit with the Trustee would be insufficient
to pay amounts due on the Securities of such series at the time of their
accelerated maturity, USM would remain liable for such amounts.
If the Trustee or paying agent is unable to apply any money or Government
Obligation in accordance with the foregoing provisions by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application,
USM's obligations under the Indenture and the Securities shall be revived and
reinstated as though no deposit had occurred pursuant to such provisions until
such time as the Trustee or paying agent is permitted to apply all such money or
Government Obligations in accordance therewith; PROVIDED, HOWEVER, that, if USM
has made any payment of interest on or principal of any Securities because of
the reinstatement of its obligations, USM shall be entitled, at its election,
(a) to receive from the Trustee or paying agent, as applicable, that portion of
such money or Government Obligations equal to the amount of such payment or (b)
to be subrogated to the rights of the Holders of such Securities to receive such
payment from the money or Government Obligations held by the Trustee or paying
agent.
GOVERNING LAW
The Indenture and the Securities issued thereunder will be governed by the
laws of the State of Illinois.
CONCERNING THE TRUSTEE
The First National Bank of Chicago, the trustee under the Indenture, is one
of a number of banks with which USM and its subsidiaries maintain ordinary
banking relationships.
PLAN OF DISTRIBUTION
USM may sell Debt Securities being offered hereby: (i) directly to
purchasers, (ii) through agents, (iii) through underwriters and (iv) through
dealers.
Offers to purchase Debt Securities may be solicited by agents designated by
USM from time to time. Any such agent, who may be deemed to be an underwriter as
that term is defined in the Securities Act, involved in the offer or sale of the
Debt Securities in respect of which this Prospectus is delivered will be named,
and any commissions payable by USM to such agent will be set forth, in the
Prospectus Supplement. Unless otherwise indicated in the Prospectus Supplement,
any such agent will be acting on a best efforts basis for the period of its
appointment.
If underwriters are utilized in the sale, USM 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 resales of
the Debt Securities in respect of which this Prospectus is delivered to the
public. Any underwriters will acquire Debt Securities for their own account and
may resell such Debt Securities from time to time in one or more transactions,
including negotiated transactions, at fixed public offering prices or at varying
prices determined at the time of sale. Debt Securities may be offered to the
public either through underwriting syndicates represented by managing
underwriters, or directly by the managing underwriters. Only underwriters named
in the Prospectus Supplement are deemed to be underwriters in connection with
the Debt Securities offered thereby. If any underwriters are utilized in the
sale of the Debt Securities, the underwriting agreement will provide that the
obligations of the underwriters are subject to certain conditions precedent and
that the underwriters with respect to a sale of Debt Securities will be
obligated to purchase all such Debt Securities, if any are purchased.
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If a dealer is utilized in the sale of the Debt Securities in respect of
which this Prospectus is delivered, USM will sell such Debt Securities to the
dealer, as principal. The dealer may then resell such Debt Securities to the
public at varying prices to be determined by such dealer at the time of resale.
Agents, underwriters and dealers may be entitled under agreements entered
into with USM to indemnification by USM against certain civil liabilities,
including liabilities under the Securities Act, or to contribution with respect
to payments which the agents, underwriters or dealers may be required to make in
respect thereof. Agents, underwriters and dealers may be customers of, engage in
transactions with, or perform services for USM in the ordinary course of
business.
Offers to purchase Debt Securities may be solicited directly by USM and
sales thereof may be made by USM directly to institutional investors or others.
The terms of any such sales will be described in the Prospectus Supplement
relating thereto.
If so indicated in the Prospectus Supplement, USM will authorize agents and
underwriters to solicit offers by certain institutions to purchase Debt
Securities from USM at the public offering price set forth in the Prospectus
Supplement pursuant to Delayed Delivery Contracts ("Contracts") providing for
payment and delivery on the date stated in the Prospectus Supplement. Each
Contract will be for an amount not less than, and unless USM otherwise agrees
the aggregate principal amount of Debt Securities sold pursuant to Contracts
shall be not less nor more than, the respective amounts stated in the Prospectus
Supplement. Institutions with whom Contracts, when authorized, may be made
include commercial and savings banks, insurance companies, pension funds,
investment companies, educational and charitable institutions and other
institutions, but shall in all cases be subject to the approval of USM.
Contracts will not be subject to any conditions except that the purchase by an
institution of the Debt Securities covered by its Contract shall not at the time
of delivery be prohibited under the laws of any jurisdiction in the United
States to which such institution is subject. A commission indicated in the
Prospectus Supplement will be paid to underwriters and agents soliciting
purchases of Debt Securities pursuant to Contracts accepted by USM.
The place and time of delivery for the Debt Securities in respect of which
this Prospectus is delivered are set forth in the accompanying Prospectus
Supplement.
LEGAL MATTERS
Certain legal matters with respect to the Securities of the Company offered
hereunder will be passed upon by Sidley & Austin, Chicago, Illinois. Stephen P.
Fitzell and Sherry S. Treston, Secretary and Assistant Secretary, respectively,
of the Company, are partners of Sidley & Austin. Walter C.D. Carlson, a director
of the Company and TDS, and a trustee and beneficiary of the voting trust which
controls TDS and the Company, is a partner of Sidley & Austin. Michael G. Hron,
and William S. DeCarlo, the Secretary and Assistant Secretary of TDS,
respectively, are partners of Sidley & Austin.
EXPERTS
The audited consolidated financial statements and schedule of United States
Cellular Corporation incorporated by reference in this Prospectus have been
audited by Arthur Andersen LLP, independent public accountants, as indicated in
their reports incorporated by reference herein. In their report, that firm
states that with respect to certain limited partnership interests, their opinion
is based on the reports of other independent accountants, namely Price
Waterhouse LLP and Coopers & Lybrand L.L.P. The text of these reports is
incorporated by reference in this Prospectus. The combined financial statements
incorporated by reference in this Prospectus have been reviewed for compilation
by Arthur Andersen LLP, as indicated in their report incorporated by reference
herein. The reports of other independent accountants on the underlying financial
statements which have been combined are incorporated by reference herein. The
financial statements referred to above have been incorporated by reference in
reliance on the reports of the various independent accountants given on the
authority of such firms as experts in auditing and accounting in giving said
reports.
15
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The expenses in connection with the issuance and distribution of the
securities being registered are:
<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee............... $ 121,213
Trustee and Paying Agent Fees and Expenses........................ 15,000*
Printing and Engraving Expenses................................... 100,000*
Legal Fees and Expenses........................................... 75,000*
Accounting Fees and Expenses...................................... 30,000*
Rating Agency Fees................................................ 225,000*
Blue Sky and Legal Investment Fees and Expenses................... 2,000*
Miscellaneous..................................................... 31,787*
---------
$ 600,000*
---------
---------
</TABLE>
- ------------------------
* Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's Restated Certificate of Incorporation contains a provision
providing that no director or officer of the Company shall be personally liable
to the Company or its stockholders for monetary damages for breach of fiduciary
duty as a director or officer except for breach of the director's or officer's
duty of loyalty to the Company or its stockholders, acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, unlawful payment of dividends, unlawful stock redemptions or repurchases
and transactions from which the director or officer derived an improper personal
benefit.
Section 145 of the General Corporation Law of Delaware permits
indemnification of directors, officers and employees of a corporation under
certain conditions and subject to certain limitations. Article XI of the
Company's Restated Certificate of Incorporation, as amended, contains provisions
for the indemnification of directors, officers and employees of the Company
within the limitations permitted by Section 145.
Section 145 of the General Corporation Law of Delaware contains provisions
permitting (and, in some situations, requiring) Delaware corporations such as
the Company to provide indemnification to their officers and directors for
losses and litigation expense incurred in connection with, among other things,
their service to the corporation in those capacities. Among other things, these
provisions provide that the Company is required to indemnify any person who was
or is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (including any action by or in the right of the Company) (a
"Proceeding") by reason of the fact that he is or was a director, officer,
employee or agent of the Company, or is or was serving at the request of the
Company as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise (including service with
respect to any employee benefit plan) against expenses (including attorneys'
fees), judgments, fines, ERISA excise taxes, penalties and amounts paid in
settlement actually and reasonably incurred by him or her in connection with
such proceeding to the fullest extent permitted by the Delaware General
Corporation Law, as the same exists or may be amended (but, in the case of any
such amendment, only to the extent that such amendment permits the Company to
provide broader indemnification rights than such law permitted the Company to
provide prior to such amendment). These provisions also provide for the advance
payment of fees and expenses reasonably incurred by the director or officer in
defense of any such Proceeding, subject to reimbursement
II-1
<PAGE>
by the director or officer if it is ultimately determined that such officer or
director is not entitled to be indemnified by the Company.
The Company has directors' and officers' liability insurance which provides,
subject to certain policy limits, deductible amounts and exclusions, coverage
for all persons who have been, are or may in the future be, directors or
officers of the Company, against amounts which such persons may pay resulting
from claims against them by reason of their being such directors or officers
during the policy period for certain breaches of duty, omissions or other acts
done or wrongfully attempted or alleged.
ITEM 16. EXHIBITS
The exhibits to this registration statement are listed on the exhibit index
hereto and are herein incorporated by reference.
ITEM 17. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the registration statement. Notwithstanding the foregoing, any increase
or decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than 20 percent change in the maximum
aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement; and
(iii) To include any material information with respect to the]plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
PROVIDED, HOWEVER, that paragraphs (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 with or furnished by the
registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange
Act of 1934 that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(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 registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
II-2
<PAGE>
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 of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
(d) The undersigned registrant hereby undertakes to file, if necessary, an
application for the purpose of determining the eligibility of the trustee to act
under subsection (a) of Section 310 of the Trust Indenture Act of 1939, as
amended, in accordance with the rules and regulations prescribed by the
Securities and Exchange Commission under Section 305(b)(2) of such Act.
(e) The undersigned registrant hereby undertakes that: (1) For purposes of
determining any liability under the Securities Act of 1933, the information
omitted from the form of prospectus filed as part of this registration statement
in reliance upon Rule 430A and contained in a form of prospectus filed by the
registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act
shall be deemed to be part of this registration statement as of the time it was
declared effective; (2) For the purposes 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-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement or Amendment to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Chicago, State of Illinois on the 30th day of
July 1997.
<TABLE>
<S> <C> <C>
UNITED STATES CELLULAR CORPORATION
BY /S/ H. DONALD NELSON
-----------------------------------------
H. Donald Nelson
PRESIDENT
</TABLE>
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints LeRoy T.
Carlson, Jr., H. Donald Nelson, and Kenneth R. Meyers, and each of them, his
true and lawful attorneys-in-fact and agents, with full power of substitution
and resubstitution for him and in his name, place and stead, in any and all
capacities to sign any and all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with all exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, and to take such actions in, and file with the appropriate
applications, statements, consents and other documents as may be necessary or
expedient to register securities of the Company for sale, granting unto said
attorneys-in-fact and agents full power and authority to do so and perform each
and every act and thing requisite or necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all the said attorneys-in-fact and
agents or any of them, or their or his substitute or substitutes, may lawfully
do or cause to be done by virtue hereof and the registrant hereby confers like
authority on its behalf.
II-4
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement or Amendment has been signed below by the following
persons in the capacities and on the 30th day of July, 1997.
SIGNATURE TITLE
- ------------------------------ ---------------------------------------------
/s/ LEROY T. CARLSON, JR.
- ------------------------------ Chairman and director
LeRoy T. Carlson, Jr.
/s/ H. DONALD NELSON
- ------------------------------ President and director (principal executive
H. Donald Nelson officer)
/s/ LEROY T. CARLSON
- ------------------------------ Director
LeRoy T. Carlson
/s/ MURRAY L. SWANSON
- ------------------------------ Director
Murray L. Swanson
/s/ PAUL-HENRI DENUIT
- ------------------------------ Director
Paul-Henri Denuit
- ------------------------------ Director
Allen Z. Loren
/s/ WALTER C.D. CARLSON
- ------------------------------ Director
Walter C.D. Carlson
/s/ KENNETH R. MEYERS
- ------------------------------ Senior Vice President -- Finance and
Kenneth R. Meyers Treasurer (principal financial officer)
/s/ PHILLIP A. LORENZINI
- ------------------------------ Controller (principal accounting officer)
Phillip A. Lorenzini
II-5
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF DOCUMENT
- ----------- ------------------------------------------------------------------------------------------------
<C> <S> <C>
1.1 Form of Underwriting Agreement.
4.1 Form of Indenture, dated as of July 31, 1997, between the Company and the The First National
Bank of Chicago, as trustee.
*4.2 Form of Global Note.
4.3 Restated Certificate of Incorporation, as amended, of the Company (Incorporated by reference to
Exhibit 2(a) to the Registrant's Amendment No. 2 on Form 8, dated December 28, 1992, to the
Registrant's Report on Form 8-A).
4.4 Restated By-laws, as amended, of the Company (Incorporated by reference to Exhibit 2(b) to the
Registrant's Amendment No. 2 on Form 8, dated December 28, 1992, to the Registrant's Report on
Form 8-A).
5 Opinion and Consent of Sidley & Austin.
12 Statements regarding computation of ratios are hereby incorporated by reference to the Company's
Annual Reports on Form 10-K for the Years Ended December 31, 1996, 1995, 1994, 1993 and 1992,
and the Company's Quarterly Report on Form 10-Q for the Quarter ended March 31, 1997.
23.1 Consent of Independent Public Accountants.
23.2 Consents of Independent Accountants.
23.3 Consent of Sidley & Austin (included in Exhibit 5 above).
24 Power of Attorney, filed as part of Part II to this Registration Statement.
25 Form T-1 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of The
First National Bank of Chicago, as trustee.
</TABLE>
- ------------------------
* To be filed subsequent to the effectiveness of this Registration Statement
by an amendment to the Registration Statement or incorporated by reference
pursuant to a Current Report on Form 8-K in connection with the offering of
Securities.
II-6
<PAGE>
UNITED STATES CELLULAR CORPORATION
(a Delaware corporation)
Debt Securities
UNDERWRITING AGREEMENT
________ __, 1997
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Merrill Lynch World Headquarters
North Tower
World Financial Center
New York, New York 10281-1209
Ladies and Gentlemen:
United States Cellular Corporation, a Delaware corporation (the "Company"),
proposes to issue and sell up to $400,000,000 aggregate principal amount of its
senior debt securities (the "Debt Securities") from time to time, in or pursuant
to one or more offerings on terms to be determined at the time of sale.
The Debt Securities will be issued in one or more series as senior
indebtedness (the "Debt Securities") under an indenture, dated as of July 31,
1997 (the "Indenture"), between the Company and The First National Bank of
Chicago, as trustee (the "Trustee"). Each series of Debt Securities may vary,
as applicable, as to title, aggregate principal amount, rank, interest rate or
formula and timing of payments thereof, stated maturity date, redemption and/or
repayment provisions, sinking fund requirements and any other variable terms
established by or pursuant to the applicable Indenture.
Whenever the Company determines to make an offering of Debt Securities
through Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated
("Merrill Lynch"), or through an underwriting syndicate managed by Merrill
Lynch, the Company will enter into an agreement (each, a "Terms Agreement")
providing for the sale of such Debt Securities to, and the purchase and offering
thereof by, Merrill Lynch and such other underwriters, if any, selected by
Merrill Lynch (the "Underwriters", which term shall include Merrill Lynch,
whether acting as sole Underwriter or as a member of an underwriting syndicate,
as well as any Underwriter substituted pursuant to Section 10 hereof). The
Terms Agreement relating to the offering of Debt Securities shall specify the
aggregate principal amount of Debt Securities to be issued (the "Underwritten
Securities"), the name of each Underwriter participating in such offering
(subject to substitution as provided in Section 10 hereof) and the name of any
Underwriter other than Merrill Lynch acting as co-manager in connection with
such offering, the aggregate principal amount of Underwritten Securities which
each such Underwriter severally agrees to purchase, whether such offering is on
a fixed or
<PAGE>
variable price basis and, if on a fixed price basis, the initial offering
price, the price at which the Underwritten Securities are to be purchased by
the Underwriters, the form, time, date and place of delivery and payment of
the Underwritten Securities and any other material variable terms of the
Underwritten Securities. The Terms Agreement, which shall be substantially in
the form of Exhibit A hereto, may take the form of an exchange of any
standard form of written telecommunication between the Company and Merrill
Lynch, acting for itself and, if applicable, as representative of any other
Underwriters. Each offering of Underwritten Securities through Merrill Lynch
as sole Underwriter or through an underwriting syndicate managed by Merrill
Lynch will be governed by this Underwriting Agreement, as supplemented by the
applicable Terms Agreement.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-___)
[and pre-effective amendment[s] no[s]. _______ thereto] for the registration
of the Debt Securities under the Securities Act of 1933, as amended (the
"1933 Act"), and the offering thereof from time to time in accordance with
Rule 415 of the rules and regulations of the Commission under the 1933 Act
(the "1933 Act Regulations"). Such registration statement has been declared
effective by the Commission and the Indenture has been duly qualified under
the Trust Indenture Act of 1939, as amended (the "1939 Act"), and the Company
has filed such post-effective amendments thereto as may be required prior to
the execution of the applicable Terms Agreement and each such post-effective
amendment has been declared effective by the Commission. Such registration
statement (as so amended, if applicable), including the information, if any,
deemed to be a part thereof pursuant to Rule 430A(b) of the 1933 Act
Regulations (the "Rule 430A Information") or Rule 434(d) of the 1933 Act
Regulations (the "Rule 434 Information"), is referred to herein as the
"Registration Statement"; and the final prospectus and the final prospectus
supplement relating to the offering of the Underwritten Securities, in the
form first furnished to the Underwriters by the Company for use in connection
with the offering of the Underwritten Securities, are collectively referred
to herein as the "Prospectus"; provided, however, that all references to the
"Registration Statement" and the "Prospectus" shall also be deemed to include
all documents incorporated therein by reference pursuant to the Securities
Exchange Act of 1934, as amended (the "1934 Act"), prior to the execution of
the applicable Terms Agreement; provided, further, that if the Company files
a registration statement with the Commission pursuant to Rule 462(b) of the
1933 Act Regulations (the "Rule 462(b) Registration Statement"), then, after
such filing, all references to "Registration Statement" shall also be deemed
to include the Rule 462 Registration Statement; and provided, further, that
if the Company elects to rely upon Rule 434 of the 1933 Act Regulations, then
all references to "Prospectus" shall also be deemed to include the final or
preliminary prospectus and the applicable term sheet or abbreviated term
sheet (the "Term Sheet"), as the case may be, in the form first furnished to
the Underwriters by the Company in reliance upon Rule 434 of the 1933 Act
Regulations, and all references in this Underwriting Agreement to the date of
the Prospectus shall mean the date of the Term Sheet. A "preliminary
prospectus" shall be deemed to refer to any prospectus used before the
Registration Statement became effective and any prospectus that omitted, as
applicable, the Rule 430A Information, the Rule 434 Information or other
information to be included upon pricing in a form of prospectus filed with
the Commission pursuant to Rule 424(b) of the 1933 Act Regulations and was
used after such effectiveness and prior to the execution and delivery of the
applicable Terms Agreement. For purposes of this Underwriting Agreement, all
references to the Registration Statement, Prospectus, Term Sheet or
preliminary prospectus or to any amendment or supplement to any of the
foregoing shall be deemed to include any copy filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval system
("EDGAR").
All references in this Underwriting Agreement to financial statements and
schedules and other information which is "contained," "included" or "stated" (or
other references of like import) in the Registration Statement, Prospectus or
preliminary prospectus shall be deemed to mean and include all such
-2-
<PAGE>
financial statements and schedules and other information which is
incorporated by reference in the Registration Statement, Prospectus or
preliminary prospectus, as the case may be, prior to the execution of the
applicable Terms Agreement; and all references in this Underwriting Agreement
to amendments or supplements to the Registration Statement, Prospectus or
preliminary prospectus shall be deemed to mean and include the filing of any
document under the 1934 Act which is incorporated by reference in the
Registration Statement, Prospectus or preliminary prospectus, as the case may
be, after the execution of the applicable Terms Agreement.
SECTION 1. REPRESENTATIONS AND WARRANTIES.
(a) The Company represents and warrants to Merrill Lynch, as of the date
hereof, and to each Underwriter named in the applicable Terms Agreement, as of
the date thereof, and as of the Closing Time (as defined below) (in each case, a
"Representation Date") as follows:
(i) The Company meets the requirements for use of Form S-3 under the
1933 Act. The Registration Statement (including any Rule 462(b)
Registration Statement) has become effective under the 1933 Act and no stop
order suspending the effectiveness of the Registration Statement (or such
Rule 462(b) Registration Statement) has been issued under the 1933 Act and
no proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with. In addition, the Indenture has been duly qualified under
the 1939 Act.
At the respective times the Registration Statement (including any Rule
462(b) Registration Statement) and any post-effective amendments thereto
(including the filing of the Company's most recent Annual Report on Form
10-K with the Commission (the "Annual Report on Form 10-K")) became
effective and at each Representation Date, the Registration Statement
(including any Rule 462(b) Registration Statement) and any amendments
thereto complied and will comply in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations and the 1939 Act
and the rules and regulations of the Commission under the 1939 Act (the
"1939 Act Regulations") and did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading. At the date of the Prospectus and at the Closing Time, neither
the Prospectus nor any amendments and supplements thereto included or will
include an untrue statement of a material fact or omitted or will omit to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
If the Company elects to rely upon Rule 434 of the 1933 Act Regulations,
the Company will comply with the requirements of Rule 434.
Each preliminary prospectus and prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when so
filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectus delivered to the Underwriters for
use in connection with the offering of Underwritten Securities will, at the
time of such delivery, be identical to any electronically transmitted
copies thereof filed with the Commission pursuant to EDGAR, except to the
extent permitted by Regulation S-T. Notwithstanding the foregoing, the
representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement or the
Prospectus made in reliance upon and in conformity with information
furnished to
-3-
<PAGE>
the Company in writing by any Underwriter through Merrill
Lynch expressly for use in the Registration Statement or the Prospectus.
(ii) The documents incorporated or deemed to be incorporated by
reference in the Registration Statement and the Prospectus, at the time
they were or hereafter are filed with the Commission, complied and will
comply in all material respects with the requirements of the 1934 Act and
the rules and regulations of the Commission thereunder (the "1934 Act
Regulations") and, when read together with the other information in the
Prospectus, at the date of the Prospectus and at the Closing Time did not
and will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
(iii) The accountants who certified the Company's consolidated
financial statements and supporting schedules included in or incorporated
by reference into the Registration Statement and the Prospectus are
independent public accountants with respect to the Company and its
consolidated subsidiaries as required by the 1933 Act and the 1933 Act
Regulations.
(iv) The consolidated financial statements of the Company and its
subsidiaries included in the Registration Statement and the Prospectus
present fairly the financial position and results of operations of the
Company and its subsidiaries on a consolidated basis at the respective
dates or for the respective periods to which they apply; such financial
statements have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis throughout the
respective periods involved and such financial statements have been
prepared, and the combined financial statements of the Los Angeles SMSA
Limited Partnership, the Nashville/Clarksville MSA Limited Partnership and
the Baton Rouge MSA Limited Partnership (collectively, the "Cellular System
Partnerships") included in the Registration Statement and the Prospectus
have been properly compiled from the amounts and notes of the underlying
separate audited financial statements of the Cellular System Partnerships,
in each case in compliance with the applicable accounting requirements of
the 1933 Act and the 1933 Act Regulations or the 1934 Act and the 1934 Act
Regulations, as the case may be; and the supporting schedules included in
the Registration Statement present fairly the information required to be
stated therein. The selected financial data and the summary financial
information included in the Prospectus present fairly the information shown
therein and have been compiled on a basis consistent with that of the
audited financial statements included in the Registration Statement and the
Prospectus. In addition, any pro forma financial statements of the Company
and its subsidiaries and the related notes thereto included in the
Registration Statement and the Prospectus present fairly the information
shown therein, have been prepared in accordance with the Commission's rules
and guidelines with respect to pro forma financial statements and have been
properly compiled on the bases described therein, and the assumptions used
in the preparation thereof are reasonable and the adjustments used therein
are appropriate to give effect to the transactions and circumstances
referred to therein.
(v) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, except as otherwise stated
therein, (A) there has been no material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its consolidated subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of business,
(B) there have been no transactions entered into by the Company or any of
its consolidated subsidiaries other than those in the ordinary course of
business which are material to the Company and its consolidated
subsidiaries considered as one enterprise,
-4-
<PAGE>
and (C) there has been no dividend or distribution of any kind declared,
paid or made by the Company on any class of its capital stock.
(vi) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Delaware, and
has corporate power and authority to own, lease and operate its properties
and to conduct its business as described in the Prospectus and to enter
into and perform its obligations under, or as contemplated under, this
Underwriting Agreement and the applicable Terms Agreement. The Company is
duly qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which it owns or leases substantial
properties or in which the conduct of its business requires such
qualification, except where the failure to be so qualified or in good
standing would not have a material adverse affect on the Company and its
consolidated subsidiaries considered as one enterprise.
(vii) Each consolidated subsidiary of the Company has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has the corporate
power and authority to own, lease and operate its properties and to conduct
its business as described in the Prospectus and is duly qualified as a
foreign corporation to transact business and is in good standing in each
jurisdiction in which it owns or leases substantial properties or in which
the conduct of its business requires such qualification, except where the
failure to be so qualified or in good standing would not have a material
adverse affect on the Company and its consolidated subsidiaries considered
as one enterprise; all of the issued and outstanding capital stock of each
such consolidated subsidiary has been duly authorized and validly issued
and is fully paid and non-assessable; and the Company owns a majority of
the issued and outstanding shares of capital stock of each of its
consolidated subsidiaries which are corporations and, except as described
in the Prospectus, owns such capital stock and its interests in each of its
consolidated subsidiaries which are not corporations, directly or through
one or more consolidated subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity, except such
security interest, mortgage, pledge, lien, encumbrance, claim or equity the
enforcement of which, individually or in the aggregate, would not have a
material adverse affect on the Company and its consolidated subsidiaries
considered as one enterprise.
(viii) The Underwritten Securities being sold pursuant to the
applicable Terms Agreement have been, or as of the date of such Terms
Agreement will have been, duly authorized by the Company for issuance and
sale pursuant to this Underwriting Agreement and such Terms Agreement, and
when issued and authenticated in the manner provided for in the Indenture
and delivered against payment of the consideration therefor specified in
the applicable Terms Agreement, will have been duly executed,
authenticated, issued and delivered and will constitute legal, valid and
binding obligations of the Company, enforceable against the Company in
accordance with their terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization or other similar laws of general applicability
now or hereafter in effect relating to or affecting creditors' rights, to
public policy considerations and to general equity principles, and will be
entitled to the benefits provided by the Indenture, which will be
substantially in the form included as an exhibit to the Registration
Statement; the Indenture has been, or prior to the issuance of the Debt
Securities thereunder will have been, duly authorized by the Board of
Directors of the Company, and when executed and delivered by the Company
and the Trustee (assuming due authorization, execution and delivery by the
Trustee), will constitute a legal, valid and binding instrument enforceable
against the Company in accordance with its terms subject, as to
enforcement, to bankruptcy, insolvency, reorganization or other similar
laws of general applicability now or hereafter in effect relating to or
affecting creditors' rights, to
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public policy considerations and to general equity principles;
equity principles; and the Underwritten Securities and the Indenture
conform to the descriptions thereof in the Prospectus.
(ix) This Underwriting Agreement has been, and the applicable Terms
Agreement as of the date thereof will have been, duly authorized, executed
and delivered by the Company.
(x) The authorized, issued and outstanding capital stock of the
Company is as set forth in or incorporated by reference into the
Registration Statement (except for subsequent issuances, if any, pursuant
to reservations or agreements referred to in the Prospectus); all of the
issued and outstanding shares of capital stock of the Company have been
duly authorized and validly issued and are fully paid and non-assessable;
the capital stock of the Company conforms to the description thereof
included in or incorporated by reference into the Registration Statement
and, except as set forth in the Prospectus, is not subject to preemptive or
other similar rights.
(xi) Neither the Company nor any of its consolidated subsidiaries is
in violation of its charter or by-laws or other documents of organization,
and none of the Company or any of its consolidated subsidiaries is in
default in the performance or observance of any material obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which the
Company or any of its consolidated subsidiaries is a party or by which it
or any of them may be bound, or to which any of the property or assets of
the Company or any of its consolidated subsidiaries is subject; the
execution, delivery and performance of this Underwriting Agreement, the
applicable Terms Agreement and the Indenture, and the consummation of the
transactions contemplated herein, therein and in the Registration Statement
and the Prospectus (including the issuance and sale of the Underwritten
Securities and the use of the proceeds from the sale of the Underwritten
Securities as described under the caption "Use of Proceeds") have been
duly authorized by all necessary corporate action by the Company and will
not conflict with or constitute a breach of, or a default or Repayment
Event (as defined below) under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the Company
or any of its consolidated subsidiaries pursuant to the terms of, any
contract, indenture, mortgage, loan agreement, note, lease or other
agreement or instrument to which the Company or any of its consolidated
subsidiaries is a party or by which the Company or any of them may be
bound, or to which any property or assets of the Company or any of its
consolidated subsidiaries is subject; nor will such action result in a
violation of the provisions of the charter or by-laws of the Company or any
of its consolidated subsidiaries or any applicable law, rule, regulation,
judgment, order or administrative or court decree; nor will such action
conflict with or have an adverse effect on any of the certificates,
authorities, licenses or permits of the Company or any of its consolidated
subsidiaries that enable them to carry on the business and operations now
operated by them and which are material to the business of the Company and
its consolidated subsidiaries considered as one enterprise. As used
herein, a "Repayment Event" means any event or condition which gives the
holder of any note, debenture or other evidence of indebtedness (or any
person acting on such holder's behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such indebtedness by the
Company or any of its subsidiaries.
(xii) No labor dispute with the employees of the Company or any of
its consolidated subsidiaries exists or, to the knowledge of the Company,
is imminent which would materially adversely affect the business operations
of the Company and its consolidated subsidiaries considered as one
enterprise.
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<PAGE>
(xiii) There is no action, suit or proceeding before or by any
court or governmental agency or body, domestic or foreign, now pending, or,
to the knowledge of the Company, threatened, against or affecting the
Company or any of its consolidated subsidiaries which is required to be
disclosed in or incorporated by reference into the Registration Statement
or, except, in the case of (A) and (B) below, as disclosed in the
Prospectus, which might (A) result in any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its consolidated subsidiaries
considered as one enterprise, (B) materially and adversely affect the
properties or assets of the Company, and its consolidated subsidiaries,
considered as one enterprise, or (C) materially and adversely affect the
consummation of the transactions contemplated by this Underwriting
Agreement, the applicable Terms Agreement or the Indenture; all pending
legal or governmental proceedings to which the Company or any of its
consolidated subsidiaries is a party or of which any of their respective
property is the subject which are not described in or incorporated by
reference into the Registration Statement and the Prospectus, including
ordinary routine litigation incidental to the business, are, considered in
the aggregate, not material to the Company and its consolidated
subsidiaries considered as one enterprise; and there are no contracts or
documents of the Company or any of its consolidated subsidiaries which are
required to be filed or incorporated by reference as exhibits to the
Registration Statement by the 1933 Act or by the 1933 Act Regulations which
have not been so filed or incorporated by reference.
(xiv) The Company and its consolidated subsidiaries own or
possess, or can acquire on reasonable terms, the patents, patent rights,
licenses, inventions, copyrights, know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential
information), systems or procedures, trademarks, service marks and trade
names currently employed by them in connection with the business now
operated by them and neither the Company nor any of its consolidated
subsidiaries has received any notice of infringement of or conflict with
asserted rights of others with respect to any of the foregoing which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would result in any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its consolidated subsidiaries
considered as one enterprise.
(xv) No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, any court or governmental
authority or agency, domestic or foreign, is necessary or required for the
due authorization, execution and delivery by the Company of this
Underwriting Agreement or the applicable Terms Agreement or for the
performance by the Company of the transactions contemplated under the
Prospectus, this Underwriting Agreement, such Terms Agreement or the
Indenture, except as may be required under the 1933 Act or 1933 Act
Regulations, the 1934 Act or 1934 Act Regulations, the 1939 Act, the 1939
Act Regulations or State securities laws.
(xvi) All taxes and fees required to be paid with respect to the
execution of the Indenture and the issuance of the Underwritten Securities
have been paid.
(xvii) The Company and its consolidated subsidiaries possess such
certificates, authorities, licenses or permits issued by the appropriate
local, state, federal or foreign regulatory agencies or bodies necessary to
conduct the business now operated by them, and, except as disclosed in the
Registration Statement or the documents incorporated by reference therein,
none of the Company or any of its consolidated subsidiaries has received
any notice of proceedings relating to the revocation or modification of any
such certificate, authority, license or permit which, singly or in the
aggregate,
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<PAGE>
if the subject of any unfavorable decision, ruling or finding,
would materially and adversely affect the condition, financial or
otherwise, or the earnings, business affairs or business prospects of the
Company and its consolidated subsidiaries considered as one enterprise.
(xviii) The Company and its consolidated subsidiaries have good and
marketable title to all real property owned by the Company and its
consolidated subsidiaries and good title to all other properties owned by
them that are material to the business of the Company and its consolidated
subsidiaries considered as one enterprise, in each case, free and clear of
all mortgages, pledges, liens, security interests, claims, restrictions or
encumbrances of any kind, except (A) as otherwise stated in the
Registration Statement and the Prospectus or (B) those which do not, singly
or in the aggregate, materially affect the value of such property and do
not interfere with the use made and proposed to be made of such property by
the Company or any of its consolidated subsidiaries. All of the leases and
subleases material to the business of the Company and its consolidated
subsidiaries considered as one enterprise, and under which the Company or
any of its consolidated subsidiaries holds properties described in the
Prospectus, are in full force and effect, and neither the Company nor any
of its consolidated subsidiaries has received any notice of any material
claim of any sort that has been asserted by anyone adverse to the rights of
the Company or any of its consolidated subsidiaries under any of the leases
or subleases mentioned above, or affecting or questioning the rights of the
Company or such consolidated subsidiary of the continued possession of the
leased or subleased premises under any such lease or sublease.
(xix) The Underwritten Securities being sold pursuant to the
applicable Terms Agreement, upon issuance, will be excluded or exempted
under, or beyond the purview of, the Commodity Exchange Act, as amended
(the "Commodity Exchange Act"), and the rules and regulations of the
Commodity Futures Trading Commission under the Commodity Exchange Act (the
"Commodity Exchange Act Regulations").
(xx) The Company is not, and upon the issuance and sale of the
Underwritten Securities as herein contemplated and the application of the
net proceeds therefrom as described in the Prospectus will not be, an
"investment company" within the meaning of the Investment Company Act of
1940, as amended (the "1940 Act").
(b) Any certificate signed by any officer of the Company or any of its
subsidiaries and delivered to any Underwriter or to counsel for the Underwriters
in connection with the offering of the Underwritten Securities shall be deemed a
representation and warranty by the Company to each Underwriter as to the matters
covered thereby on the date of such certificate and, unless subsequently amended
or supplemented, at each Representation Date subsequent thereto.
SECTION 2. SALE AND DELIVERY TO THE UNDERWRITERS; CLOSING.
(a) The several commitments of the Underwriters to purchase the
Underwritten Securities pursuant to the applicable Terms Agreement shall be
deemed to have been made on the basis of the representations, warranties and
agreements herein contained and shall be subject to the terms and conditions
herein set forth.
(b) Payment of the purchase price for the Underwritten Securities shall be
made at the office of Merrill Lynch & Co., 5500 Sears Tower, Chicago, Illinois
60606, and delivery of the certificates for the Underwritten Securities shall be
made against payment therefor at the office of Merrill Lynch, Pierce, Fenner
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<PAGE>
& Smith Incorporated, Merrill Lynch World Headquarters, North Tower, World
Financial Center, New York, New York 10281-1209, or (in either case) at such
other place or places as shall be agreed upon by Merrill Lynch and the Company,
at 10:00 A.M. (Eastern time) on the third (fourth, if the pricing occurs after
4:30 P.M. (Eastern time) on any given day) business day after the date of the
applicable Terms Agreement (unless postponed in accordance with the provisions
of Section 10 hereof), or such other time not later than ten business days after
such date as shall be agreed upon by Merrill Lynch and the Company (such time
and date of payment and delivery being herein called "Closing Time"). Payment
shall be made to the Company by wire transfer of immediately available funds to
a bank account designated by the Company, against delivery to Merrill Lynch for
the respective accounts of the Underwriters of the Underwritten Securities to be
purchased by them. It is understood that each Underwriter has authorized
Merrill Lynch, for its account, to accept delivery of, receipt for, and make
payment of the purchase price for, the Underwritten Securities which it has
severally agreed to purchase. Merrill Lynch, individually and not as
representative of the Underwriters, may (but shall not be obligated to) make
payment of the purchase price for the Underwritten Securities to be purchased by
any Underwriter whose funds have not been received by the Closing Time but such
payment shall not relieve such Underwriter from its obligations hereunder.
(c) Certificates for the Underwritten Securities shall be in such
denominations and registered in such names as Merrill Lynch may request in
writing at least one full business day prior to the Closing Time. The
certificates for the Underwritten Securities will be made available for
examination and packaging by Merrill Lynch in The City of New York not later
than 10:00 A.M. (Eastern time) on the last business day prior to Closing Time.
SECTION 3. COVENANTS. The Company covenants with Merrill Lynch and
with each Underwriter participating in the offering of Underwritten Securities
as follows:
(a) The Company, subject to Section 3(b), will comply with the
requirements of Rule 430A of the 1933 Act Regulations and/or Rule 434 of the
1933 Act Regulations, if and as applicable, and will notify the
representative(s) of the Underwriters immediately, and confirm the notice in
writing, of (i) the effectiveness of any post-effective amendment to the
Registration Statement or the filing of any supplement or amendment to the
Prospectus, (ii) the receipt of any comments from the Commission, (iii) any
request by the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for additional information, and
(iv) the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus, or of the suspension of the
qualification of the Underwritten Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for any of
such purposes. The Company will promptly effect the filings necessary pursuant
to Rule 424 and will take such steps as it deems necessary to ascertain promptly
whether the Prospectus transmitted for filing under Rule 424 was received for
filing by the Commission and, in the event that it was not, it will promptly
file the Prospectus. The Company will make every reasonable effort to prevent
the issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) The Company will give Merrill Lynch notice of its intention to file or
prepare any amendment to the Registration Statement (including any filing under
Rule 462(b) of the 1933 Act Regulations), any Term Sheet or any amendment,
supplement or revision to either the prospectus included in the Registration
Statement at the time it became effective or to the Prospectus, whether pursuant
to the 1933 Act, the 1934 Act or otherwise, will furnish Merrill Lynch with
copies of any such documents a reasonable amount of time prior to such proposed
filing or use, as the case may be, and will not file or use any such document to
which Merrill Lynch or counsel for the Underwriters shall reasonably object.
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<PAGE>
(c) The Company has furnished or will deliver to Merrill Lynch and counsel
for the Underwriters, without charge, as many signed copies of the Registration
Statement as originally filed and of each amendment thereto (including exhibits
filed therewith or incorporated by reference therein and documents incorporated
or deemed to be incorporated by reference therein) as Merrill Lynch has
requested or shall reasonably request, and as many signed copies of all consents
and certificates of experts as Merrill Lynch has requested or shall reasonably
request, and will also deliver to Merrill Lynch, without charge, a conformed
copy of the Registration Statement as originally filed and of each amendment
thereto (without exhibits) for each of the Underwriters. The Registration
Statement and each amendment thereto furnished to the Underwriters will be
identical to any electronically transmitted copies thereof filed with the
Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(d) The Company will deliver to each Underwriter, without charge, as many
copies of each preliminary prospectus as such Underwriter may reasonably
request, and the Company hereby consents to the use of such copies for purposes
permitted by the 1933 Act. The Company will furnish to each Underwriter,
without charge, during the period when the Prospectus is required to be
delivered under the 1933 Act or the 1934 Act, such number of copies of the
Prospectus as such Underwriter may reasonably request. The Prospectus and any
amendments or supplements thereto furnished to the Underwriters will be
identical to any electronically transmitted copies thereof filed with the
Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(e) The Company will comply with the 1933 Act and the 1933 Act Regulations
and the 1934 Act and the 1934 Act Regulations so as to permit the completion of
the distribution of the Underwritten Securities as contemplated in this
Underwriting Agreement and the applicable Terms Agreement and in the
Registration Statement and the Prospectus. If at any time when the Prospectus
is required by the 1933 Act or the 1934 Act to be delivered in connection with
sales of the Securities, any event shall occur or condition shall exist as a
result of which it is necessary, in the opinion of counsel for the Underwriters
or for the Company, to amend the Registration Statement in order that the
Registration Statement will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading or to amend or supplement the
Prospectus in order that the Prospectus will not include an untrue statement of
a material fact or omit to state a material fact necessary in order to make the
statements therein not misleading in the light of the circumstances existing at
the time it is delivered to a purchaser, or if it shall be necessary, in the
opinion of such counsel, at any such time to amend the Registration Statement or
amend or supplement the Prospectus in order to comply with the requirements of
the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare and
file with the Commission, subject to Section 3(b), such amendment or supplement
as may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such requirements, and the
Company will furnish to the Underwriters, without charge, such number of copies
of such amendment or supplement as the Underwriters may reasonably request.
(f) The Company will use its best efforts, in cooperation with the
Underwriters, to qualify the Underwritten Securities for offering and sale under
the applicable securities laws of such states and other jurisdictions (domestic
or foreign) as Merrill Lynch may designate and to maintain such qualifications
in effect for a period of not less than one year from the date of the applicable
Terms Agreement; provided, however, that the Company shall not be obligated to
file any general consent to service of process or to qualify as a foreign
corporation or as a dealer in securities in any jurisdiction in which it is not
so qualified or to subject itself to taxation in respect of doing business in
any jurisdiction in which it is not otherwise so subject. In each jurisdiction
in which the Underwritten Securities have been so qualified, the Company will
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<PAGE>
file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the date of such Terms Agreement.
(g) The Company will timely file such reports pursuant to the 1934 Act as
are necessary in order to make generally available to its securityholders as
soon as practicable an earnings statement for the purposes of, and to provide
the benefits contemplated by, the last paragraph of Section 11(a) of the 1933
Act.
(h) The Company will use the net proceeds received by it from the sale of
the Underwritten Securities in the manner specified in the Prospectus under "Use
of Proceeds".
(i) The Company will use its best efforts to effect the listing of the
Underwritten Securities and any related Underlying Securities, prior to the
Closing Time, on any national securities exchange or quotation system if and as
specified in the applicable Terms Agreement.
(j) Between the date of the applicable Terms Agreement and the Closing
Time or such other date specified in such Terms Agreement, the Company will not,
without the prior written consent of Merrill Lynch, directly or indirectly,
issue, sell, offer or contract to sell, grant any option for the sale of, or
otherwise dispose of, any debt securities.
(k) The Company, during the period when the Prospectus is required to be
delivered under the 1933 Act or the 1934 Act, will file all documents required
to be filed with the Commission pursuant to the 1934 Act within the time periods
required by the 1934 Act and the 1934 Act Regulations.
SECTION 4. PAYMENT OF EXPENSES. The Company will pay all expenses
incident to the performance of its obligations under this Underwriting Agreement
and the applicable Terms Agreement, including (i) the printing and filing of
the Registration Statement as originally filed and of each amendment thereto,
(ii) the printing of this Underwriting Agreement, any Terms Agreement, any
agreement among Underwriters and the Indenture, (iii) the preparation, issuance
and delivery to Merrill Lynch of the certificates for the Underwritten
Securities, including any transfer taxes and any stamp or other duties payable
upon the sale, issuance or delivery of the Underwritten Securities to the
Underwriters, (iv) the fees and disbursements of the Company's counsel and
accountants, (v) the qualification of the Underwritten Securities under
securities laws in accordance with the provisions of Section 3(f), including
filing fees and the fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation of the Blue Sky
surveys, (vi) the printing and delivery to the Underwriters of copies of the
Registration Statement as originally filed and of each amendment thereto, of the
preliminary prospectuses, of any Term Sheet and of the Prospectus and any
amendments or supplements thereto, (vii) the printing and delivery to the
Underwriters of copies of the Blue Sky surveys, (viii) the fees and expenses of
the Trustee and any Depositary, including the fees and disbursements of their
respective counsel, (ix) any fees payable in connection with the rating of the
Underwritten Securities, (x) the fees and expenses incurred with respect to any
listing of the Underwritten Securities, and (xi) the filing fees incident to the
review, if any, by the National Association of Securities Dealers, Inc. (the
"NASD") of the terms of the sale of the Underwritten Securities.
If the applicable Terms Agreement is terminated by Merrill Lynch in
accordance with the provisions of Section 5 or Section 9(b)(i) hereof, the
Company shall reimburse the Underwriters for all of their out-of-pocket
expenses, including the reasonable fees and disbursements of counsel for the
Underwriters.
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SECTION 5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations
of the Underwriters to purchase and pay for the Underwritten Securities pursuant
to the applicable Terms Agreement are subject to the accuracy of the
representations and warranties of the Company contained in Section 1 hereof or
in certificates of any officer of the Company or any of its subsidiaries
delivered pursuant to the provisions hereof, to the performance by the Company
of its covenants and other obligations hereunder, and to the following further
conditions:
(a) The Registration Statement, including any Rule 462(b) Registration
Statement, has become effective under the 1933 Act and no stop order suspending
the effectiveness of the Registration Statement shall have been issued under the
1933 Act and no proceedings for that purpose shall have been instituted or be
pending or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of counsel for the Underwriters. A prospectus
containing information relating to the description of the Underwritten
Securities, the specific method of distribution and similar matters shall have
been filed with the Commission in accordance with Rule 424(b)(1), (2), (3), (4)
or (5), as applicable (or any required post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A), or, if the Company has elected to rely upon Rule 434
of the 1933 Act Regulations, a Term Sheet including the Rule 434 Information
shall have been filed with the Commission in accordance with Rule 424(b)(7).
(b) At Closing Time, Merrill Lynch shall have received:
(1) The opinion, dated as of Closing Time, of Sidley & Austin,
counsel for the Company, in form and substance reasonably satisfactory to
counsel for the Underwriters, together with signed or reproduced copies of
such letter for each of the other Underwriters, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware.
(ii) The Company has corporate power and authority to own, lease
and operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under, or as
contemplated under, this Underwriting Agreement and the applicable Terms
Agreement.
(iii) To the knowledge of such counsel, the Company is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which it owns or leases substantial
properties or in which the conduct of its business requires such
qualification, except where the failure to be so qualified or in good
standing could not reasonably be expected to have a material adverse effect
on the Company and its consolidated subsidiaries considered as one
enterprise.
(iv) Each of United States Cellular Operating Company ("USCOC")
and United States Cellular Investment Company ("USCIC" and, together with
USCOC, the "Direct Subsidiaries") has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware and, to the knowledge of such counsel, is duly qualified as a
foreign corporation to transact business and is in good standing in each
jurisdiction in which it owns or leases substantial properties or in which
the conduct of its business requires such qualification, except where the
failure to be so qualified or in good standing could not reasonably be
expected to have a material adverse affect on the Company
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and its consolidated subsidiaries considered as one enterprise; all of the
issued and outstanding capital stock of each of the Direct Subsidiaries has
duly authorized and validly issued and is fully paid and non-assessable and
all of such capital stock is owned of record by the Company free and clear,
to such counsel's knowledge, of any security interest, mortgage, pledge,
lien, encumbrance or claim.
(v) The Underwritten Securities have been duly authorized by the
requisite corporate action on the part of the Company for issuance and sale
pursuant to this Underwriting Agreement and the applicable Terms Agreement,
and the Underwritten Securities, when executed and authenticated in
accordance with the terms of the Indenture and delivered to and paid for by
the Underwriters as provided in such Terms Agreement, will be valid and
binding obligations of the Company entitled to the benefits of the
Indenture and enforceable against the Company in accordance with their
terms, except to the extent that enforcement thereof may be limited by (1)
bankruptcy, insolvency, reorganization, moratorium or other similar laws
now or hereafter in effect relating to creditors' rights generally, (2)
public policy considerations and (3) general principles of equity
(regardless of whether enforceability is considered in a proceeding at law
or in equity); and the Underwritten Securities and the Indenture conform as
to legal matters in all material respects to the descriptions thereof in
the Prospectus and are in substantially the form filed or incorporated by
reference, as the case may be, as an exhibit to the Registration Statement.
(vi) The Indenture has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement enforceable
against the Company in accordance with its terms, except to the extent that
enforcement thereof may be limited by (1) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, (2) public policy considerations
and (3) general principles of equity (regardless of whether enforceability
is considered in a proceeding at law or in equity).
(vii) The Company has authorized capital stock as set forth in or
incorporated by reference into the Registration Statement; to the knowledge
of such counsel, all of the issued and outstanding shares of capital stock
of the Company have been duly and validly authorized and issued and are
fully paid and non-assessable; and the capital stock of the Company
conforms as to legal matters in all material respects to the descriptions
thereof included in or incorporated by reference into the Prospectus.
(viii) This Underwriting Agreement and the applicable Terms
Agreement have each been duly authorized, executed and delivered by the
Company.
(ix) The Registration Statement (including any Rule 462(b)
Registration Statement) has been declared effective under the 1933 Act.
Any required filing of the Prospectus pursuant to Rule 424(b) has been made
in the manner and within the time period required by Rule 424(b). To the
best of such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement (or such Rule 462(b)
Registration Statement) has been issued under the 1933 Act and no
proceedings for that purpose have been initiated or are pending or
threatened by the Commission.
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(x) The Registration Statement (including any Rule 462(b)
Registration Statement) and the Prospectus, excluding the documents
incorporated by reference therein, and each amendment or supplement to the
Registration Statement (including any Rule 462(b) Registration Statement)
and Prospectus, excluding the documents incorporated by reference therein,
as of their respective effective or issue dates (other than the financial
statements, including notes thereto, financial data and supporting
schedules included therein or omitted therefrom and the Trustee's Statement
of Eligibility on Form T-1 (the "Form T-1"), as to which no opinion need be
rendered) complied as to form in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations.
(xi) The documents incorporated by reference into the Prospectus
(other than the financial statements, including notes thereto, financial
data and supporting schedules therein or omitted therefrom, as to which no
opinion need be rendered), when they were filed with the Commission,
complied as to form in all material respects with the applicable
requirements of the 1934 Act and the 1934 Act Regulations.
(xii) The information in the Prospectus under "Description of
Debt Securities," if any, or any caption purporting to describe any such
Debt Securities and in the Registration Statement under Item 15, to the
extent that it constitutes matters of law, summaries of legal matters or
the Company's charter or bylaws, or legal conclusions, has been reviewed by
such counsel and is correct in all material respects.
(xiii) To such counsel's knowledge, there are no legal or
governmental proceedings pending or threatened which are required to be
disclosed in the Registration Statement or the Prospectus other than those
disclosed therein or incorporated by reference therein.
(xiv) To such counsel's knowledge, (1) there are no contracts,
indentures, mortgages, loan agreements, notes, leases or other instruments
required to be described in the Prospectus or the Registration Statement or
to be filed as exhibits thereto which are not described or filed as
required and (2) such descriptions are correct in all material respects.
(xv) No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency, domestic or foreign, is necessary or
required for the due authorization, execution or delivery by the Company of
the Underwriting Agreement or the applicable Terms Agreement or for the
performance by the Company of the transactions contemplated under the
Prospectus, the Underwriting Agreement, such Terms Agreement or the
Indenture, other than under the 1933 Act, the 1933 Act Regulations, the
1934 Act, the 1934 Act Regulations, the 1939 Act and the 1939 Act
Regulations, which have already been made, obtained or rendered, as
applicable, or State securities laws.
(xvi) The execution and delivery of this Underwriting Agreement,
the applicable Terms Agreement and the Indenture, the issuance of the
Underwritten Securities, the compliance by the Company with all of the
provisions of the Underwritten Securities, the Indenture, this Underwriting
Agreement and the applicable Terms Agreement and the consummation of the
transactions contemplated herein, therein and in the Registration Statement
and the Prospectus (including the issuance and sale of the Underwritten
Securities
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as described under the caption "Use of Proceeds") do not and
will not constitute a breach of, or default or Repayment Event under, or
result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or, to such counsel's knowledge,
any of the Company's consolidated subsidiaries pursuant to the terms of,
(1) the Certificate of Incorporation or by-laws of the Company, (2) any
contract, indenture, mortgage, loan agreement, note, lease or other
agreement or instrument of which such counsel has knowledge, to which the
Company or any of the Company's consolidated subsidiaries is a party or by
which the Company or any of the Company's consolidated subsidiaries may be
bound, or to which any property or assets of the Company or any of the
Company's consolidated subsidiaries is subject, or (3) to such counsel's
knowledge, any currently applicable law, rule, regulation, judgment, order
or administrative or court decree.
(xvii) The Indenture has been duly qualified under the 1939 Act.
(xviii) The Underwritten Securities being sold pursuant to the
applicable Terms Agreement, upon issuance, will be excluded or exempted
under, or beyond the purview of, the Commodity Exchange Act, as amended
(the "Commodity Exchange Act"), and the rules and regulations of the
Commodity Futures Trading Commission under the Commodity Exchange Act (the
"Commodity Exchange Act Regulations").
(xix) The Company is not, and upon the issuance and sale of the
Underwritten Securities as herein contemplated and the application of the
net proceeds therefrom as described in the Prospectus will not be, an
"investment company" within the meaning of the Investment Company Act of
1940, as amended (the "1940 Act").
(xx) To such counsel's knowledge, there are no statutes or
regulations that are required to be described in the Prospectus that are
not described as required.
(xxi) To such counsel's knowledge, neither the Company nor any
of the Direct Subsidiaries is in violation of its charter or by-laws and no
default by the Company or any of its consolidated subsidiaries exists in
the due performance or observance of any material obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument that is described
or referred to in the Registration Statement or the Prospectus or filed or
incorporated by reference as an exhibit to the Registration Statement.
Such opinion of Sidley & Austin shall additionally state that nothing has
come to their attention that has caused them to believe that the Registration
Statement (including any Rule 426(b) Registration Statement) or any
post-effective amendment thereto (except for financial statements, including
notes thereto, and supporting schedules and other financial data included
therein or omitted therefrom and for the Form T-1, as to which no belief need
be expressed), at the time the Registration Statement (including any Rule
462(b) Registration Statement) or any post-effective amendment thereto
(including the filing of the Company's Annual Report on Form 10-K with the
Commission) became effective or at the date of the applicable Terms
Agreement, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus or any amendment or
supplement thereto (except for financial statements, including notes thereto,
and supporting schedules and other financial data included therein or omitted
therefrom, as to which no belief need be expressed), at the time the
Prospectus was issued, at the time any such amended or supplemented
prospectus
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was issued or at the Closing Time, included or includes an untrue statement
of a material fact or omitted or omits to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading. Such counsel may also state that they
have relied as to materiality to the extent they deem appropriate in
accordance with their professional responsibilities, upon the judgment of
officers and representatives of the Company.
Such opinion shall be limited to the laws of the State of New York, the
State of Illinois, the General Corporation Law of the State of Delaware and the
federal law of the United States (other than the Communications Act of 1934, as
amended (the "Communications Act"), and the rules and regulations thereunder).
In rendering such opinion, such counsel may rely, as to all matters governed by
jurisdictions other than the laws of the State of New York, the State of
Illinois, the General Corporation Law of the State of Delaware and the federal
law of the United States, upon the opinions of counsel satisfactory to Merrill
Lynch (which opinions shall be dated and furnished to Merrill Lynch at the
Closing Time, shall be satisfactory in form and substance to counsel for the
Underwriters and shall expressly state that the Underwriters may rely on such
opinions as if they were addressed to them), provided that Sidley & Austin shall
state in their opinion that they believe that they and the Underwriters are
justified in relying upon such opinions. Such opinion shall not state that it
is to be governed or qualified by, or that it is otherwise subject to, any
treatise, written policy or other document relating to legal opinions,
including, without limitation, the Legal Opinion Accord of the ABA Section of
Business Law (1991).
(2) The opinion, dated as of Closing Time, of Koteen and Naftalin,
special counsel to the Company, in form and substance reasonably
satisfactory to counsel for the Underwriters, to the effect that:
(i) No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, the Federal Communications
Commission (the "FCC"), is necessary or required for the due authorization,
execution or delivery by the Company of this Underwriting Agreement or the
applicable Terms Agreement or for the performance by the Company of the
transactions contemplated under the Prospectus, this Underwriting
Agreement, such Terms Agreement or the Indenture.
(ii) The execution and delivery of this Underwriting Agreement,
the applicable Terms Agreement and the Indenture, the issuance of the
Underwritten Securities, the compliance by the Company with all of the
provisions of the Underwritten Securities, the Indenture, this Underwriting
Agreement and the applicable Terms Agreement and the consummation of the
transactions contemplated herein, therein and in the Registration Statement
and the Prospectus (including the issuance and sale of the Underwritten
Securities as described under the caption "Use of Proceeds") do not and
will not, to such counsel's knowledge, conflict with or result in any
violation of, or the creation of any lien, charge or encumbrance upon, the
property or assets of the Company or, to such counsel's knowledge, its
consolidated subsidiaries, under the Communications Act or any rule,
regulation, judgment, order or administrative or court decree issued,
enacted or promulgated thereunder; neither will any such action conflict
with or have a material adverse effect on any of the certificates,
authorities, licenses or permits, if any, issued or to be issued by the FCC
to the Company or, to such counsel's knowledge, any of the Company's
consolidated subsidiaries that enable them to carry on the business and
operations now operated by them and which are material to the business of
the Company and its consolidated subsidiaries considered as one enterprise.
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(3) The opinion, dated as of Closing Time, of Mayer, Brown & Platt,
counsel for the Underwriters, together with signed or reproduced copies of
such letter for each of the other Underwriters, with respect to the matters
set forth in (i) (insofar as it relates to the existence and good standing
of the Company), (ii), (v), (vi), (viii), (ix), (x), (xii) (solely as to
the information in the Prospectus under "Description of Debt Securities" or
any caption purporting to describe any such Debt Securities), (xvii) and
the penultimate paragraph of subsection (b)(1) of this Section. In giving
such opinion, such counsel may rely, as to all matters governed by the laws
of jurisdictions other than the law of the State of New York, the State of
Illinois, the federal law of the United States and the General Corporation
Law of the State of Delaware, upon the opinions of counsel satisfactory to
Merrill Lynch. Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem proper,
upon certificates of officers of the Company and its subsidiaries and
certificates of public officials.
(c) At Closing Time there shall not have been, since the date of the
applicable Terms Agreement or since the respective dates as of which
information is given in the Prospectus, any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, and
Merrill Lynch shall have received a certificate of the Chairman, President or
Vice President-Finance of the Company and of the Controller or Treasurer of
the Company, dated as of Closing Time, to the effect that (i) there has been
no such material adverse change with respect to the Company and its
subsidiaries considered as one enterprise, (ii) the representations and
warranties in Section 1(a) are true and correct with the same force and
effect as though expressly made at and as of Closing Time, (iii) the Company
has complied with all agreements and satisfied all conditions on its part to
be performed or satisfied at or prior to Closing Time, and (iv) no stop order
suspending the effectiveness of the Registration Statement has been received
by the Company or, to the Company's knowledge, issued and, to the Company's
knowledge, no proceedings for that purpose have been initiated or threatened
by the Commission.
(d) At the time of the execution of the applicable Terms Agreement,
Merrill Lynch shall have received from Arthur Andersen LLP a letter dated such
date, in form and substance satisfactory to Merrill Lynch, together with signed
or reproduced copies of such letter for each of the other Underwriters,
containing statements and information of the type ordinarily included in
accountants' "comfort letters" to underwriters with respect to the financial
statements and certain financial information contained in the Registration
Statement and the Prospectus.
(e) At Closing Time, Merrill Lynch shall have received from Arthur
Andersen LLP a letter, dated as of Closing Time, to the effect that they
reaffirm the statements made in the letter furnished pursuant to subsection (d)
of this Section, except that the specified date referred to shall be a date not
more than three business days prior to Closing Time.
(f) At Closing Time counsel for the Underwriters shall have been furnished
with such documents and opinions as they may reasonably require for the purpose
of enabling them to pass upon the issuance and sale of the Underwritten
Securities, as contemplated herein, and related proceedings, or in order to
evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the
Underwritten Securities shall be reasonably satisfactory in form and substance
to Merrill Lynch and counsel for the Underwriters.
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(g) At Closing Time, the Underwritten Securities shall have the ratings
accorded by any "nationally recognized statistical rating organization", as
defined by the Commission for purposes of Rule 436(g)(2) of the 1933 Act
Regulations (a "NRSRO"), if and as specified in the applicable Terms Agreement.
(h) At Closing Time, the Underwritten Securities shall have been approved
for listing, subject only to official notice of issuance, if and as specified in
the applicable Terms Agreement.
(i) If the Registration Statement or an offering of Underwritten
Securities has been filed with the NASD for review, the NASD shall not have
raised any objection with respect to the fairness and reasonableness of the
underwriting terms and arrangements.
If any condition specified in this Section shall not have been fulfilled
when and as required to be fulfilled, this Underwriting Agreement and the
applicable Terms Agreement may be terminated by Merrill Lynch by notice to the
Company at any time at or prior to Closing Time and such termination shall be
without liability of any party to any other party except as provided in Section
4 and except that Sections 1, 6, 7 and 8 shall survive any such termination and
remain in full force and effect.
SECTION 6. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless each Underwriter and
each person, if any, who controls any Underwriter within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), including the Rule 430A Information and the
Rule 434 Information deemed to be part of the Registration Statement, if
applicable, or the omission or alleged omission therefrom of a material
fact required to be stated therein or necessary to make the statements
therein not misleading or arising out of any untrue statement or alleged
untrue statement of a material fact contained in any preliminary prospectus
or the Prospectus (or any amendment or supplement thereto) or the omission
or alleged omission therefrom of a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission or any such
alleged untrue statement or omission; provided that (subject to Section
6(d) below) any such settlement is effected with the written consent of the
Company; and
(iii) against any and all expense whatsoever, as incurred
(including, subject to Section 6(c) hereof, the fees and disbursements of
counsel chosen by Merrill Lynch), reasonably incurred in investigating,
preparing or defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
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provided, however, that (A) this indemnity agreement does not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through Merrill Lynch expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information deemed to be a part thereof, if applicable, or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto) and (B) this indemnity agreement, with respect to any preliminary
prospectus, does not apply to any loss, liability, claim, damage or expense if a
copy of the Prospectus (as then amended or supplemented, if the Company shall
have furnished any amendments or supplements thereto to an Underwriter) was not
sent or given by or on behalf of such Underwriter to the person asserting any
such loss, liability, claim, damage or expense if such is required by law at or
prior to the written confirmation of the sale of such Underwritten Securities to
such person and if the Prospectus (as so amended or supplemented) would have, as
determined by a court of competent jurisdiction, cured the defect giving rise to
such loss, liability, claim, damage or expense.
(b) Each Underwriter severally agrees to indemnify and hold harmless the
Company, each of the Company's directors, each of the Company's officers who
signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act against any and all loss, liability, claim, damage and expense
described in the indemnity contained in subsection (a) of this Section, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendment thereto), including the Rule 430A Information and the Rule 434
Information deemed to be a part thereof, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the
Company by such Underwriter through Merrill Lynch expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary prospectus
or the Prospectus (or any amendment or supplement thereto).
(c) Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
hereunder to the extent it is not materially prejudiced as a result thereof and
in any event shall not relieve it from any liability which it may have otherwise
than on account of this indemnity agreement. In the case of parties indemnified
pursuant to Section 6(a) above, counsel to the indemnified parties shall be
selected by Merrill Lynch, and, in the case of parties indemnified pursuant to
Section 6(b) above, counsel to the indemnified parties shall be selected by the
Company. An indemnifying party may participate at its own expense in the
defense of any such action; provided, however, that counsel to the indemnifying
party shall not (except with the consent of the indemnified party) also be
counsel to the indemnified party. In no event shall the indemnifying parties be
liable for fees and expenses of more than one counsel (in addition to any local
counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
Subject to Section 6(d) below, no indemnifying or indemnified party shall,
without the prior written consent of the other parties (which consent shall not
be unreasonably withheld), settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 6 or Section 7 hereof (whether or not any such parties are
actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified and
indemnifying party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as to
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or an admission of fault, culpability or a failure to act by or on behalf of any
indemnified or indemnifying party.
(d) If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 6(a)(ii) effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
Notwithstanding the immediately preceding sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, an indemnifying party shall
not be liable for any settlement of the nature contemplated by Section 6(a)(ii)
effected without its consent if such indemnifying party (i) reimburses such
indemnified party in accordance with such request to the extent it considers
such request to be reasonable and (ii) provides written notice to the
indemnified party substantiating the unpaid balance as unreasonable, in each
case prior to the date of such settlement.
SECTION 7. CONTRIBUTION. If the indemnification provided for in
Section 6 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company, on the one hand, and the Underwriters, on the other hand, from the
offering of the Underwritten Securities pursuant to the applicable Terms
Agreement or (ii) if the allocation provided by clause (i) is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company, on the one hand, and the Underwriters, on the other hand, in
connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company, on the one hand, and the
Underwriters, on the other hand, in connection with the offering of the
Underwritten Securities pursuant to the applicable Terms Agreement shall be
deemed to be in the same respective proportions as the total net proceeds from
the offering of such Underwritten Securities (before deducting expenses)
received by the Company and the total underwriting discount received by the
Underwriters, in each case as set forth on the cover of the Prospectus, or, if
Rule 434 is used, the corresponding location on the Term Sheet, bear to the
aggregate initial public offering price of such Underwritten Securities as set
forth on such cover.
The relative fault of the Company, on the one hand, and the Underwriters,
on the other hand, shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be
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deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Underwritten Securities underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of any such untrue
or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Company. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the aggregate principal amount of Underwritten Securities set
forth opposite their respective names in the applicable Terms Agreement, and not
joint.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Underwriting Agreement or the applicable Terms Agreement, or contained in
certificates of officers of the Company or any of its subsidiaries submitted
pursuant hereto or thereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Company, and shall survive
delivery of and payment for the Underwritten Securities.
SECTION 9. TERMINATION OF AGREEMENT.
(a) This Underwriting Agreement (excluding the applicable Terms Agreement)
may be terminated for any reason at any time by the Company or by Merrill Lynch
upon the giving of 30 days' prior written notice of such termination to the
other party hereto.
(b) Merrill Lynch may terminate the applicable Terms Agreement, by notice
to the Company, at any time at or prior to the Closing Time, if (i) there has
been, since the time of execution of such Terms Agreement or since the
respective dates as of which information is given in the Prospectus, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) there has occurred any material adverse
change in the financial markets in the United States or, if the Underwritten
Securities include Debt Securities denominated or payable in, or indexed to, one
or more foreign or composite currencies, in the international financial markets,
or any outbreak of hostilities or escalation thereof or other calamity or crisis
or any change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the reasonable judgment of Merrill
Lynch, impracticable to market
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the Underwritten Securities or to enforce contracts for the sale of the
Underwritten Securities, or (iii) trading in any securities of the Company
has been suspended or materially limited by the Commission or the American
Stock Exchange, or if trading generally on the New York Stock Exchange or the
American Stock Exchange or in the Nasdaq National Market has been suspended
or materially limited, or minimum or maximum prices for trading have been
fixed, or maximum ranges for prices have been required, by either of said
exchanges or by such system or by order of the Commission, the NASD or any
other governmental authority, or (iv) a banking moratorium has been declared
by either Federal or New York authorities or, if the Underwritten Securities
include Debt Securities denominated or payable in, or indexed to, one or more
foreign or composite currencies, by the relevant authorities in the related
foreign country or countries, or (v) there has occurred, since the time of
execution of such Terms Agreement, a downgrading in, or withdrawal of, the
rating assigned to the Underwritten Securities or any of the Company's other
debt securities by a NRSRO, or any such NRSRO shall have publicly announced
that it has under surveillance or review with possible negative implications
its rating of the Underwritten Securities or any of the Company's other debt
securities.
(c) If this Underwriting Agreement or the applicable Terms Agreement is
terminated pursuant to this Section 9, such termination shall be without
liability of any party to any other party except as provided in Section 4
hereof, and provided further that Sections 1, 6, 7 and 8 shall survive such
termination and remain in full force and effect.
SECTION 10. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If one or more
of the Underwriters shall fail at the Closing Time to purchase the Underwritten
Securities which it or they are obligated to purchase under the applicable Terms
Agreement (the "Defaulted Securities"), then Merrill Lynch shall have the right,
within 24 hours thereafter, to make arrangements for one or more of the
non-defaulting Underwriters, or any other underwriters, to purchase all, but not
less than all, of the Defaulted Securities in such amounts as may be agreed upon
and upon the terms herein set forth; if, however, Merrill Lynch shall not have
completed such arrangements within such 24-hour period, then:
(a) if the aggregate principal amount of Defaulted Securities does not
exceed 10% of the aggregate principal amount of Underwritten Securities to be
purchased on such date pursuant to such Terms Agreement, the non-defaulting
Underwriters shall be obligated, severally and not jointly, to purchase the full
amount thereof in the proportions that their respective underwriting obligations
under such Terms Agreement bear to the underwriting obligations of all
non-defaulting Underwriters, or
(b) if the aggregate principal amount of Defaulted Securities exceeds 10%
of the aggregate principal amount of Underwritten Securities to be purchased on
such date pursuant to such Terms Agreement, such Terms Agreement shall terminate
without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section 10 shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of
the applicable Terms Agreement, either Merrill Lynch or the Company shall have
the right to postpone the Closing Time for a period not exceeding seven days in
order to effect any required changes in the Registration Statement or the
Prospectus or in any other documents or arrangements.
SECTION 11. NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to Merrill Lynch at Merrill Lynch & Co., 5500
Sears Tower,
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Chicago, Illinois 60606, attention of Steve Moss; notices to the
Company shall be directed to it at United States Cellular Corporation, 8410 West
Bryn Mawr, Suite 700, Chicago, Illinois 60631-3486; Attention: Senior Vice
President-Finance and Treasurer.
SECTION 12. PARTIES. This Underwriting Agreement and the applicable
Terms Agreement shall each inure to the benefit of and be binding upon
Merrill Lynch, the Company, and, upon execution of such Terms Agreement, any
other Underwriters and their respective successors. Nothing expressed or
mentioned in this Underwriting Agreement or such Terms Agreement is intended
or shall be construed to give any person, firm or corporation, other than the
Underwriters and the Company and their respective successors and the
controlling persons and officers and directors referred to in Sections 6 and
7 and their heirs and legal representatives, any legal or equitable right,
remedy or claim under or in respect of this Underwriting Agreement or such
Terms Agreement or any provision herein or therein contained. This
Underwriting Agreement and such Terms Agreement and all conditions and
provisions hereof and thereof are intended to be for the sole and exclusive
benefit of the parties hereto and thereto and their respective successors,
and said controlling persons and officers and directors and their heirs and
legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Underwritten Securities from any Underwriter
shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS UNDERWRITING AGREEMENT AND ANY
APPLICABLE TERMS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK. SPECIFIED TIMES OF DAY REFER TO NEW YORK
CITY TIME.
SECTION 14. EFFECT OF HEADINGS. The Article and Section headings
herein are for convenience only and shall not affect the construction hereof.
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If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
Underwriting Agreement, along with all counterparts, will become a binding
agreement between Merrill Lynch and the Company in accordance with its terms.
Very truly yours,
UNITED STATES CELLULAR CORPORATION
By _________________________________
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By ___________________________________
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Exhibit A
UNITED STATES CELLULAR CORPORATION
(a Delaware corporation)
DEBT SECURITIES
TERMS AGREEMENT
To: United States Cellular Corporation
8410 West Bryn Mawr Avenue
Suite 700
Chicago, IL 60631-3486
Ladies and Gentlemen:
We understand that United States Cellular Corporation, a Delaware
corporation (the "Company"), proposes to issue and sell $ aggregate
principal amount of its senior debt securities (the "Debt Securities").
Subject to the terms and conditions set forth or incorporated by reference
herein, we [the underwriters named below (the "Underwriters")] offer to
purchase [, severally and not jointly,] the principal amount of Debt
Securities [opposite their names set forth below] at the purchase price set
forth below.
Principal Amount
UNDERWRITER of Debt Securities
_______________
Total $
================
The Debt Securities shall have the following terms:
Title:
Rank:
Ratings:
Aggregate principal amount:
Denominations:
Currency of payment:
Interest rate or formula:
Interest payment dates:
Regular record dates:
Stated maturity date:
Redemption provisions:
Sinking fund requirements:
Listing requirements:
<PAGE>
Black-out provisions:
Fixed or Variable Price Offering: [Fixed] [Variable] Price Offering
If Fixed Price Offering, initial public offering price per security:
____% of the principal amount, plus accrued interest [amortized original
issue discount], if any, from _________________.
Purchase price per security: ___% of principal amount, plus accrued interest
[amortized original issue discount], if any, from _________________.
Form:
Other terms and conditions:
Closing date and location:
All of the provisions contained in the document attached as Annex I hereto
entitled "UNITED STATES CELLULAR CORPORATION--Debt Securities--Underwriting
Agreement" are hereby incorporated by reference in their entirety herein and
shall be deemed to be a part of this Terms Agreement to the same extent as if
such provisions had been set forth in full herein. Terms defined in such
document are used herein as therein defined.
Please accept this offer no later than ____ o'clock P.M. (New York City
time) on ______________ by signing a copy of this Terms Agreement in the space
set forth below and returning the signed copy to us.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By ___________________________________
Authorized Signatory
[Acting on behalf of itself and the other named
Underwriters.]
Accepted:
UNITED STATES CELLULAR CORPORATION
By _____________________________________
Name:
Title:
-25-
<PAGE>
- -------------------------------------------------------------------------------
United States Cellular Corporation, Issuer
AND
The First National Bank of Chicago, Trustee
Indenture
Dated as of July 31, 1997
____________
- -------------------------------------------------------------------------------
<PAGE>
CROSS REFERENCE SHEET
---------------
Between
Provisions of Trust Indenture Act of 1939 and Indenture to be dated as
of July 31, 1997 between United States Cellular Corporation and The First
National Bank of Chicago, Trustee:
Section of the Act Section of Indenture
- ------------------ --------------------
310(a)(1) and (2).............................. 6.9
310(a)(3) and (4).............................. Inapplicable
310(b)......................................... 6.8 and 6.10(a) and (b)
310(c)......................................... Inapplicable
311(a)......................................... 6.13(a) and (c)(1) and (2)
311(b)......................................... 6.13(b)
311(c)......................................... Inapplicable
312(a)......................................... 4.1 and 4.2(a)
312(b)......................................... 4.2(a) and (b)
312(c)......................................... 4.2(c)
313(a)......................................... 4.4(a)
313(b)(1)...................................... Inapplicable
313(b)(2)...................................... 4.4(b)
313(c)......................................... 4.4(c)
313(d)......................................... 4.4(d)
314(a)......................................... 4.3
314(a)(4)...................................... 3.5
314(b)......................................... Inapplicable
314(c)(1) and (2).............................. 11.5
314(c)(3)...................................... Inapplicable
314(d)......................................... Inapplicable
314(e)......................................... 11.5
314(f)......................................... Inapplicable
315(a), (c) and (d)............................ 6.1
315(b)......................................... 5.11
315(e)......................................... 5.12
316(a)(1)...................................... 5.9
316(a)(2)...................................... Not required
316(a) (last sentence)......................... 7.4
316(b)......................................... 5.7
317(a)......................................... 5.2
317(b)......................................... 3.4(a) and (b)
318(a)......................................... 11.7
- ------------------
* This Cross Reference Sheet is not part of the Indenture.
<PAGE>
TABLE OF CONTENTS
___________
PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
RECITALS
Authorization of Indenture . . . . . . . . . . . . . . . . . . . . . . . 1
Compliance with Legal Requirements . . . . . . . . . . . . . . . . . . . 1
Purpose of and Consideration for Indenture . . . . . . . . . . . . . . . 1
ARTICLE ONE
DEFINITIONS
SECTION 1.1 Certain Terms Defined . . . . . . . . . . . . . . . . . . . . 1
"Authenticating Agent" . . . . . . . . . . . . . . . . . . . . . . 2
"Authorized Newspaper" . . . . . . . . . . . . . . . . . . . . . . 2
"Board of Directors" . . . . . . . . . . . . . . . . . . . . . . . 2
"Board Resolution" . . . . . . . . . . . . . . . . . . . . . . . . 2
"Business Day" . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Capital Stock" . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Capitalization" . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Capitalized Rent" . . . . . . . . . . . . . . . . . . . . . . . . 3
"Commission" . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"Consolidated Capitalization" . . . . . . . . . . . . . . . . . . . 3
"Corporate Trust Office" . . . . . . . . . . . . . . . . . . . . . 3
"Coupon" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"covenant defeasance" . . . . . . . . . . . . . . . . . . . . . . . 3
"Debt" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"Depositary" . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"Dollar" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
"ECU" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
"Event of Default" . . . . . . . . . . . . . . . . . . . . . . . . 4
"Exchange Act" . . . . . . . . . . . . . . . . . . . . . . . . . . 4
"Foreign Currency" . . . . . . . . . . . . . . . . . . . . . . . . 4
"Funded Debt" . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
"Government Obligations" . . . . . . . . . . . . . . . . . . . . . 4
"Holder","Holder of Securities",
"Securityholder" . . . . . . . . . . . . . . . . . . . . . . . 4
"Indenture" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
"Interest" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
"Issuer" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
"Issuer Order" . . . . . . . . . . . . . . . . . . . . . . . . . . 5
"Judgment Currency" . . . . . . . . . . . . . . . . . . . . . . . . 5
"Lien" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
"Officers' Certificate" . . . . . . . . . . . . . . . . . . . . . . 5
"Opinion of Counsel" . . . . . . . . . . . . . . . . . . . . . . . 5
"Original issue date" . . . . . . . . . . . . . . . . . . . . . . . 5
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<PAGE>
"Original Issue Discount Security" . . . . . . . . . . . . . . . . 6
"Outstanding" . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
"Periodic Offering" . . . . . . . . . . . . . . . . . . . . . . . . 6
"Person" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
"principal" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
"property" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
"Record Date" . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
"Registered Global Security" . . . . . . . . . . . . . . . . . . . 7
"Registered Security" . . . . . . . . . . . . . . . . . . . . . . . 7
"Required Currency" . . . . . . . . . . . . . . . . . . . . . . . . 7
"Responsible Officer" . . . . . . . . . . . . . . . . . . . . . . . 7
"Sale and Leaseback Transaction" . . . . . . . . . . . . . . . . . 8
"Secured Debt" . . . . . . . . . . . . . . . . . . . . . . . . . . 8
"Security" " or "Securities" . . . . . . . . . . . . . . . . . . . 8
"Security Register" and "Security Registrar" . . . . . . . . . . . 8
"Subsidiary" . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
"subsidiary" . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
"Tax Consolidated Subsidiary" . . . . . . . . . . . . . . . . . . . 8
"Trust Indenture Act Of 1939" . . . . . . . . . . . . . . . . . . . 9
"Trustee" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
"Unregistered Security" . . . . . . . . . . . . . . . . . . . . . . 9
"Yield to Maturity" . . . . . . . . . . . . . . . . . . . . . . . . 9
ARTICLE TWO
SECURITIES
SECTION 2.1 Forms Generally . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 2.2 Form of Trustee's Certificate of
Authentication . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 2.3 Amount Unlimited; Issuable in Series. . . . . . . . . . . . . . 10
SECTION 2.4 Authentication and Delivery of Securities . . . . . . . . . . . 13
SECTION 2.5 Execution of Securities . . . . . . . . . . . . . . . . . . . . 16
SECTION 2.6 Certificate of Authentication . . . . . . . . . . . . . . . . . 17
SECTION 2.7 Denomination and Date of Securities,
Payments of Interest . . . . . . . . . . . . . . . . . . . . 17
SECTION 2.8 Registration, Transfer and Exchange . . . . . . . . . . . . . . 18
SECTION 2.9 Mutilated, Defaced, Destroyed, Lost and
Stolen Securities . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.10 Cancellation of Securities; Disposition
Thereof . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.11 Temporary Securities . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE THREE
COVENANTS OF THE ISSUER
SECTION 3.1 Payment of Principal and Interest . . . . . . . . . . . . . . . 25
SECTION 3.2 Offices for Payments, etc. . . . . . . . . . . . . . . . . . . . 26
SECTION 3.3 Appointment to Fill a Vacancy in Office
of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . 27
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<PAGE>
SECTION 3.4 Paying Agents . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 3.5 Written Statement to Trustee . . . . . . . . . . . . . . . . . . 28
SECTION 3.6 Limitation on Secured Debt . . . . . . . . . . . . . . . . . . . 28
SECTION 3.7 Limitation on Sale and Leaseback . . . . . . . . . . . . . . . . 31
ARTICLE FOUR
SECURITYHOLDERS LISTS AND REPORTS BY THE
ISSUER AND THE TRUSTEE
SECTION 4.1 Issuer to Furnish Trustee Names and
Addresses of Securityholders . . . . . . . . . . . . . . . . 32
SECTION 4.2 Preservation and Disclosure of
Securityholders Lists . . . . . . . . . . . . . . . . . . . . 33
SECTION 4.3 Reports by the Issuer . . . . . . . . . . . . . . . . . . . . . 35
SECTION 4.4 Reports by the Trustee . . . . . . . . . . . . . . . . . . . . . 35
SECTION 4.5 Publication of Certain Notices . . . . . . . . . . . . . . . . . 37
ARTICLE FIVE
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.1 Event of Default Defined; Acceleration
of Maturity; Waiver of Default . . . . . . . . . . . . . . . 38
SECTION 5.2 Collection of Indebtedness by Trustee;
Trustee May Prove Debt . . . . . . . . . . . . . . . . . . . 41
SECTION 5.3 Application of Proceeds. . . . . . . . . . . . . . . . . . . . . 44
SECTION 5.4 Suits for Enforcement. . . . . . . . . . . . . . . . . . . . . . 45
SECTION 5.5 Restoration of Rights on Abandonment
of Proceedings. . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 5.6 Limitations on Suits by Securityholders . . . . . . . . . . . . 46
SECTION 5.7 Unconditional Right of Securityholders to
Institute Certain Suits. . . . . . . . . . . . . . . . . . . 46
SECTION 5.8 Powers and Remedies Cumulative; Delay
or Omission Not Waiver of Default. . . . . . . . . . . . . . 47
SECTION 5.9 Control by Holders of Securities . . . . . . . . . . . . . . . . 47
SECTION 5.10 Waiver of Past Defaults . . . . . . . . . . . . . . . . . . . . 48
SECTION 5.11 Trustee to Give Notice of Default,
But May Withhold in Certain Circumstances . . . . . . . . . . 48
SECTION 5.12 Right of Court to Require Filing of
Undertaking to Pay Costs . . . . . . . . . . . . . . . . . . 49
ARTICLE SIX
CONCERNING THE TRUSTEE
SECTION 6.1 Duties and Responsibilities of the
Trustee; During Default; Prior to Default . . . . . . . . . . 49
SECTION 6.2 Certain Rights of the Trustee . . . . . . . . . . . . . . . . . 51
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<PAGE>
SECTION 6.3 Trustee Not Responsible for Recitals,
Disposition of Securities or
Application of Proceeds Thereof . . . . . . . . . . . . . . . 52
SECTION 6.4 Trustee and Agents May Hold Securities
or Coupons; Collections, etc. . . . . . . . . . . . . . . . . 52
SECTION 6.5 Moneys Held by Trustee . . . . . . . . . . . . . . . . . . . . . 53
SECTION 6.6 Compensation and Indemnification of
Trustee and Its Prior Claim . . . . . . . . . . . . . . . . . 53
SECTION 6.7 Right of Trustee to Rely on Officers'
Certificate, etc. . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 6.8 Qualification of Trustee; Conflicting
Interests . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 6.9 Persons Eligible for Appointment as Trustee . . . . . . . . . . 54
SECTION 6.10 Resignation and Removal; Appointment of
Successor Trustee . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 6.11 Acceptance of Appointment by Successor
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 6.12 Merger, Conversion, Consolidation or
Succession to Business of Trustee . . . . . . . . . . . . . . 57
SECTION 6.13 Preferential Collection of Claims
Against the Issuer . . . . . . . . . . . . . . . . . . . . . 58
SECTION 6.14 Appointment of Authenticating Agent . . . . . . . . . . . . . . 62
ARTICLE SEVEN
CONCERNING THE SECURITYHOLDERS
SECTION 7.1 Evidence of Action Taken by
Securityholders . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 7.2 Proof of Execution of Instruments and
of Holding of Securities . . . . . . . . . . . . . . . . . . 64
SECTION 7.3 Holders to be Treated as Owners . . . . . . . . . . . . . . . . 65
SECTION 7.4 Securities Owned by Issuer Deemed Not
Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . 65
SECTION 7.5 Right of Revocation of Action Taken . . . . . . . . . . . . . . 66
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES
SECTION 8.1 Supplemental Indentures Without Consent of
Securityholders . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 8.2 Supplemental Indentures With Consent of
Securityholders . . . . . . . . . . . . . . . . . . . . . . . 68
SECTION 8.3 Effect of Supplemental Indenture . . . . . . . . . . . . . . . . 70
SECTION 8.4 Documents to Be Given to Trustee . . . . . . . . . . . . . . . . 70
SECTION 8.5 Notation on Securities in Respect of
Supplemental Indentures. . . . . . . . . . . . . . . . . . . 70
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<PAGE>
ARTICLE NINE
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.1 Covenant of Issuer Not to Merge,
Consolidate, Sell or Convey Property
Except Under Certain Conditions . . . . . . . . . . . . . . . 71
SECTION 9.2 Securities to be Secured in Certain
Events . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
SECTION 9.3 Successor Person Substituted for Issuer . . . . . . . . . . . . 72
SECTION 9.4 Officers' Certificate and Opinion of
Counsel Delivered to Trustee . . . . . . . . . . . . . . . . 73
ARTICLE TEN
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 10.1 Satisfaction and Discharge of Indenture . . . . . . . . . . . . 73
SECTION 10.2 Application by Trustee of Funds
Deposited for Payment of Securities . . . . . . . . . . . . . 78
SECTION 10.3 Repayment of Moneys Held by Paying
Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
SECTION 10.4 Return of Moneys Held by Trustee and
Paying Agent Unclaimed for Two Years . . . . . . . . . . . . 78
SECTION 10.5 Indemnity for Government Obligations . . . . . . . . . . . . . 79
SECTION 10.6. Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . 79
ARTICLE ELEVEN
MISCELLANEOUS PROVISIONS
SECTION 11.1 Incorporators, Stockholders, Officers
and Directors of Issuer Exempt from
Individual Liability . . . . . . . . . . . . . . . . . . . . 80
SECTION 11.2 Provisions of Indenture for the Sole
Benefit of Parties and Holders of
Securities and Coupons . . . . . . . . . . . . . . . . . . . 80
SECTION 11.3 Successors and Assigns of Issuer Bound
by Indenture . . . . . . . . . . . . . . . . . . . . . . . . 80
SECTION 11.4 Notices and Demands on Issuer, Trustee
and Holders of Securities and Coupons . . . . . . . . . . . . 80
SECTION 11.5 Officers' Certificates and Opinions
of Counsel; Statements to be Contained
Therein . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
SECTION 11.6 Payments Due on Saturdays, Sundays
and Holidays . . . . . . . . . . . . . . . . . . . . . . . . 83
SECTION 11.7 Conflict of Any Provision of Indenture
with Trust Indenture Act of 1939 . . . . . . . . . . . . . . 83
SECTION 11.8 Illinois Law to Govern . . . . . . . . . . . . . . . . . . . . 83
SECTION 11.9 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . 83
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<PAGE>
SECTION 11.10 Effect of Headings . . . . . . . . . . . . . . . . . . . . . . 83
SECTION 11.11 Securities in a Foreign Currency or
in ECU . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
SECTION 11.12 Judgment Currency . . . . . . . . . . . . . . . . . . . . . . 84
ARTICLE TWELVE
REDEMPTION OF SECURITIES AND SINKING FUNDS
SECTION 12.1 Applicability of Article . . . . . . . . . . . . . . . . . . . 85
SECTION 12.2 Notice of Redemption; Partial
Redemptions . . . . . . . . . . . . . . . . . . . . . . . . . 85
SECTION 12.3 Payment of Securities Called for
Redemption . . . . . . . . . . . . . . . . . . . . . . . . . 87
SECTION 12.4 Exclusion of Certain Securities from
Eligibility for Selection for Redemption . . . . . . . . . . 88
SECTION 12.5 Mandatory and Optional Sinking Funds . . . . . . . . . . . . . 88
TESTIMONIUM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
vi
<PAGE>
THIS INDENTURE dated as of July 31, 1997 between United States
Cellular Corporation, a Delaware corporation (the Issuer"), and The First
National Bank of Chicago, a national banking association, as trustee (the
"Trustee").
W I T N E S S E T H :
WHEREAS, the Issuer has duly authorized the issue from time to time
of its unsecured debentures, notes or other evidences of indebtedness to be
issued in one or more series (the "Securities") up to such principal amount
or amounts as may from time to time be authorized in accordance with the
terms of this Indenture;
WHEREAS, the Issuer has duly authorized the execution and delivery
of this Indenture to provide, among other things, for the authentication,
delivery and administration of the Securities; and
WHEREAS, all things necessary to make this Indenture a valid
indenture and agreement according to its terms have been done;
NOW, THEREFORE:
In consideration of the premises and the purchases of the
Securities by the holders thereof, the Issuer and the Trustee mutually
covenant and agree for the equal and proportionate benefit of the respective
holders from time to time of the Securities and of the Coupons, if any,
appertaining thereto as follows:
ARTICLE ONE
DEFINITIONS
SECTION 1.1 CERTAIN TERMS DEFINED. The following terms (except as
otherwise expressly provided or unless the context otherwise clearly
requires) for all purposes of this Indenture and of any indenture
supplemental hereto shall have the respective meanings specified in this
Section. All other terms used in this Indenture that are defined in the
Trust Indenture Act of 1939 or the definitions of which in the Securities Act
of 1933 are referred to in the Trust Indenture Act of 1939, including terms
defined therein by reference to the Securities Act of 1933 (except as herein
otherwise expressly provided or unless the context otherwise requires), shall
have the meanings assigned to such terms in said Trust Indenture Act and in
said Securities Act as in force at the date of this Indenture. All
accounting terms used herein and not otherwise expressly defined shall have
the meanings assigned to such terms in accordance with generally accepted
accounting principles, and the term "GENERALLY
<PAGE>
ACCEPTED ACCOUNTING PRINCIPLES" means such accounting principles as are
generally accepted at the time of any computation. The words "HEREIN",
"HEREOF" and "HEREUNDER" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision. The terms defined in this Article include the plural as well as
the singular.
"AUTHENTICATING AGENT" shall have the meaning set forth in
Section 6.14.
"AUTHORIZED NEWSPAPER" means, to the extent specified in item (18)
of Section 2.3 or in or pursuant to any Board Resolution or supplemental
indenture referred to in Section 2.3, the newspaper or newspapers so
specified or, if not so specified, means with respect to each country which
is so specified or which is required by Section 4.5 a newspaper published in
an official language of such country of publication customarily published at
least once a day for at least five days in each calendar week and of general
circulation in such country so specified or required. If it shall be
impractical in the opinion of the Trustee to make any publication of any
notice required hereby in an Authorized Newspaper, any publication or other
notice in lieu thereof which is made or given with the approval of the
Trustee shall constitute a sufficient publication of such notice.
"BOARD OF DIRECTORS" means either the Board of Directors of the
Issuer or any committee of such Board duly authorized to act on its behalf.
"BOARD RESOLUTION" means a copy of one or more resolutions,
certified by the secretary or an assistant secretary of the Issuer to have
been duly adopted or consented to by the Board of Directors and to be in full
force and effect, and delivered to the Trustee.
"BUSINESS DAY" means, with respect to any series of Securities, a
day on which, in any city where amounts are payable on the Securities of such
series as therein specified, banking institutions are not authorized or
required by law or regulation to close.
"CAPITAL STOCK" means and includes any and all shares, interests,
participations or other equivalents (however designated) of ownership in a
corporation or other Person.
"CAPITALIZATION" means with respect to a Person the total of (a)
Funded Debt, (b) the par value or, in the case of Capital Stock with no par
value, a value stated on the books, of all outstanding shares of Capital
Stock, (c) the paid-in surplus and retained earnings (or minus the net
surplus deficit, as the case may be), (d) deferred taxes and deferred
investment tax
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<PAGE>
credits, (e) Capitalized Rent and (f) minority interests in subsidiaries, of
such Person.
"CAPITALIZED RENT" means the present value (discounted semi-annually at
a discount rate equal to the weighted average rate of interest borne by the
Securities then Outstanding) of the total net amount of rent payable for the
remaining term of any lease of property by the Issuer (including any period
for which such lease has been extended); PROVIDED, HOWEVER, that no such
rental obligation shall be deemed to be Capitalized Rent unless the lease
resulted from a Sale and Leaseback Transaction. The total net amount of rent
payable under any lease for any period shall be the total amount of the rent
payable by the lessee with respect to such period but shall not include
amounts required to be paid on account of maintenance and repairs, insurance,
taxes, assessments, water rates, sewer rates and similar charges.
"COMMISSION" means the Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act, or if at any time after
the execution and delivery of this Indenture such Commission is not existing
and performing the duties now assigned to it under the Trust Indenture Act of
1939, then the body performing such duties on such date.
"CONSOLIDATED CAPITALIZATION" means the Capitalization of the Issuer and
its Subsidiaries determined on a consolidated basis as of the end of the
Issuer's then most recently reported fiscal year or quarter, as the case may
be, including minority interests in Subsidiaries.
"CORPORATE TRUST OFFICE" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date as of which this
Indenture is dated, located at One First National Plaza, Suite 0126, Chicago,
Illinois 60670, Attention: Corporate Trust Office.
"COUPON" means any interest coupon appertaining to a Security.
"COVENANT DEFEASANCE" shall have the meaning set forth in
Section 10.1(C).
"DEBT" means with respect to a Person all obligations of such Person for
borrowed money and all such obligations of any other Person for borrowed
money guaranteed by such Person.
"DEPOSITARY" means, with respect to the Securities of any series
issuable or issued in the form of one or more Registered Global Securities,
the Person designated as Depositary by the Company pursuant to Section 2.3
until a successor Depositary shall have become such pursuant to the
applicable provisions of
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this Indenture, and thereafter "Depositary" shall mean each Person who is
then a Depositary hereunder; and if at any time there is more than one such
Person, "Depositary" as used with respect to the Securities of any such
series shall mean each Depositary with respect to the Registered Global
Securities of such series.
"DOLLAR" means the coin or currency of the United States of America as
at the time of payment is legal tender for the payment of public and private
debts.
"ECU" means the European Currency Unit as defined and revised from time
to time by the Council of European Communities.
"EVENT OF DEFAULT" means any event or condition specified as such in
Section 5.1.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.
"FOREIGN CURRENCY" means a currency issued by the government of a
country other than the United States of America.
"FUNDED DEBT" means any Debt maturing by its terms more than one year
from its date of issuance (notwithstanding that any portion of such Debt is
included in current liabilities).
"GOVERNMENT OBLIGATIONS" means securities that are (a) direct
obligations of the government which issued the currency in which the
Securities of a particular series are denominated for the payment of which
its full faith and credit is pledged or (b) obligations of a Person
controlled or supervised by and acting as an agency or instrumentality of
such government the payment of which is unconditionally guaranteed as a full
faith and credit obligation by such government, which, in either case, are
not callable or redeemable at the option of the issuer thereof, and shall
also include a depository receipt issued by a bank (as defined in Section
3(a)(2) of the Securities Act of 1933, as amended) as custodian with respect
to any such Government Obligation or a specific payment of principal of or
interest on any such Government Obligation held by such custodian for the
account of the holder of such depository receipt, provided that (except as
provided by law) such custodian is not authorized to make any deduction from
the amount payable to the holder of such depository receipt from any amount
received by the custodian in respect of such Government Obligation or the
specific payment of principal of or interest on such Government Obligation
evidenced by such depository receipt.
"HOLDER","HOLDER OF SECURITIES", "SECURITYHOLDER" or other similar terms
mean (a) in the case of any Registered Security, the Person in whose name
such Security is registered in the
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Security Register kept by the Security Registrar for that purpose in
accordance with the terms hereof, and (b) in the case of any Unregistered
Security, the bearer of such Security, or any Coupon appertaining thereto, as
the case may be.
"INDENTURE" means this instrument as originally executed and delivered
or, if amended or supplemented as herein provided, as so amended or
supplemented or both, and shall include the forms and terms of particular
series of Securities established as provided hereunder.
"INTEREST" means, when used with respect to noninterest bearing
Securities, interest payable after maturity.
"ISSUER" means (except as otherwise provided in Article Six) United
States Cellular Corporation, a Delaware corporation and, subject to Article
Nine, its successors and assigns.
"ISSUER ORDER" means a written statement, request or order of the Issuer
signed in its name by the Chairman of the Board of Directors, the President
or any Vice President (whether or not designated by a number or numbers or a
word or words added before or after the title "Vice President") and by the
Treasurer, any Assistant Treasurer, the Secretary, any Assistant Secretary,
the Controller or any Assistant Controller of the Issuer.
"JUDGMENT CURRENCY" shall have the meaning set forth in Section 11.12.
"LIEN" means any mortgage, pledge, security interest, lien, charge or
other encumbrance.
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of
the Board of Directors, the President or any Vice President (whether or not
designated by a number or numbers or a word or words added before or after
the title "Vice President") and by the Treasurer, any Assistant Treasurer,
the Secretary, any Assistant Secretary, the Controller or any Assistant
Controller of the Issuer and delivered to the Trustee. Each such certificate
shall include the statements provided for in Section 11.5.
"OPINION OF COUNSEL" means an opinion in writing signed by legal
counsel, who may be an employee of, or counsel to, the Issuer. Each such
opinion shall include the statements provided for in Section 11.5, if and to
the extent required thereby.
"ORIGINAL ISSUE DATE" of any Security (or portion thereof) means the
earlier of (a) the date of such Security or (b) the date of any Security (or
portion thereof) for which such Security was issued (directly or indirectly)
on registration of transfer, exchange or substitution.
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"ORIGINAL ISSUE DISCOUNT SECURITY" means (i) any Security that provides
for an amount less than the principal amount thereof to be due and payable
upon a declaration of acceleration of the maturity thereof pursuant to
Section 5.1 and (ii) any other Security deemed an original issue discount
security for United States Federal income tax purposes.
"OUTSTANDING" when used with reference to Securities, shall, subject to
the provisions of Section 7.4, mean, as of any particular time, all
Securities authenticated and delivered by the Trustee under this Indenture,
except:
(a) Securities theretofore canceled by the Trustee or delivered to
the Trustee for cancellation;
(b) Subject to Article 10, Securities, or portions thereof, for the
payment or redemption of which moneys or Government Obligations (as
provided for in Section 10.1) in the necessary amount shall have been
deposited in trust with the Trustee or with any paying agent (other than
the Issuer) or shall have been set aside, segregated and held in trust by
the Issuer for the Holders of such Securities (if the Issuer shall act as
its own paying agent), PROVIDED that if such securities, or portions
thereof, are to be redeemed prior to the maturity thereof, notice of such
redemption shall have been given as herein provided, or provision
satisfactory to the Trustee shall have been made for giving such notice;
and
(c) Securities which shall have been paid or in substitution for
which other Securities shall have been authenticated and delivered pursuant
to the terms of Section 2.9 (except with respect to any such Security as to
which proof satisfactory to the Trustee is presented that such Security is
held by a Person in whose hands such Security is a legal, valid and binding
obligation of the Issuer).
In determining whether the Holders of the requisite principal
amount of Outstanding Securities of any or all series have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, the
principal amount of an Original Issue Discount Security that shall be deemed
to be Outstanding for such purposes shall be the amount of the principal
thereof that would be due and payable as of the date of such determination
upon a declaration of acceleration of the maturity thereof pursuant to
Section 5.1.
"PERIODIC OFFERING" means an offering of Securities of any series
from time to time, the specific terms of which Securities, including, without
limitation, the rate or rates of interest, if any, thereon, the stated
maturity or maturities thereof and the redemption provisions, if any, with
respect
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thereto are to be determined by the issuer or its agents upon the issuance of
such Securities.
"PERSON" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
"PRINCIPAL", whenever used with reference to the Securities or any
Security or any portion thereof shall be deemed to include the words "and
premium, if any, and unless otherwise provided in accordance with Section
2.3, shall mean with respect to Original Issue Discount Securities the
initial offering price thereof plus interest accrued to the date of
determination at the semiannual compounding rate which is necessary to
produce the Yield to Maturity for such Original Issue Discount Security from
the original issue date thereof.
"PROPERTY" means any directly-held interest of a Person in any kind
of property or asset, whether real, personal or mixed and whether tangible or
intangible and includes Capital Stock of a subsidiary or other Person.
"RECORD DATE" shall have the meaning set forth in Section 2.7.
"REGISTERED GLOBAL SECURITY" means a Security evidencing all or a
part of a series of Securities issued to the Depositary, or its nominee, for
such series in accordance with Section 2.4, and bearing the legend prescribed
in Section 2.4.
"REGISTERED SECURITY" means any Security registered on the Security
Register of the Issuer.
"REQUIRED CURRENCY" shall have the meaning set forth in
Section 11.12.
"RESPONSIBLE OFFICER", when used with respect to the Trustee, means
the chairman of the board of directors, any vice chairman of the board of
directors, the chairman of the trust committee, the chairman of the executive
committee, any vice chairman of the executive committee, the president, any
vice president (whether or not designated by numbers or words added before or
after the title "vice president"), the cashier, the secretary, the treasurer,
any trust officer, any assistant trust officer, any assistant vice president,
any assistant cashier, any assistant secretary, any assistant treasurer or
any other officer or assistant officer of the Trustee customarily performing
functions similar to those performed by the persons who at the time shall be
such officers, respectively, or to whom any corporate trust matter is
referred because of his knowledge of and familiarity with the particular
subject.
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"SALE AND LEASEBACK TRANSACTION" means any arrangement with any
Person other than a Tax Consolidated Subsidiary providing for the leasing (as
lessee) by the Issuer of any property (except for temporary leases for a
term, including any renewal thereof, of not more than three years (provided
that any such temporary lease may be for a term of up to five years if (a)
the Board of Directors reasonably finds such term to be in the best interest
of the Issuer and (b) the primary purpose of the transaction of which such
lease is a part is not to provide funds to or financing for the Issuer)),
which property has been or is to be sold or transferred by the Issuer (i) to
any subsidiary of the Issuer in contemplation of or in connection with such
arrangement or (ii) to such other Person.
"SECURED DEBT" means Debt of the Issuer secured by any Lien on
property (including Capital Stock or indebtedness of subsidiaries of the
Issuer) owned by the Issuer.
"SECURITY" " or "SECURITIES" shall have the meaning stated in the
first recital of this Indenture or, as the case may be, Securities that have
been authenticated and delivered under this Indenture.
"SECURITY REGISTER" and "SECURITY REGISTRAR" shall have the
respective meanings set forth in Section 2.8.
"SPECIFIED EUROPEAN NATION" means the United Kingdom, Ireland,
France, Spain, Portugal, Belgium, the Netherlands, Luxembourg, Switzerland,
Italy, Austria, Germany, Denmark, Norway, Sweden, Finland, Iceland, the Czeck
Republic, Hungary, Poland, Greece, Turkey and Israel.
"SUBSIDIARY" means a Person which is consolidated with the Issuer
in accordance with generally accepted accounting principles.
"SUBSIDIARY" means, with respect to any Person, any corporation,
association, partnership or other business entity of which more than 50% of
the total voting power of shares of Capital Stock or other interests
(including partnership interests) entitled (without regard to the occurrence
of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly,
by (i) such Person, (ii) such Person and one or more subsidiaries of such
Person or (iii) one or more subsidiaries, of such Person.
"TAX CONSOLIDATED SUBSIDIARY" means a subsidiary of the Issuer with
which, at the time a Sale and Leaseback Transaction is entered into by the
Issuer, the Issuer would be entitled to file a consolidated federal income
tax return.
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"TRUST INDENTURE ACT OF 1939" (except as otherwise provided in
Sections 8.1, 8.2 and 11.7) means the Trust Indenture Act of 1939 as in force
at the date as of which this Indenture was originally executed.
"TRUSTEE" means the Person identified as "Trustee" in the first
paragraph hereof and, subject to the provisions of Article Six, shall also
include any successor trustee. "Trustee" shall also mean or include each
Person who is then a trustee hereunder; and if at any time there is more than
one such Person, Trustee" as used with respect to the Securities of any
series shall mean the trustee with respect to the Securities of such series.
"UNREGISTERED SECURITY" means any Security other than a Registered
Security.
"YIELD TO MATURITY" means the yield to maturity on a series of
Securities, calculated at the time of issuance of such series, or, if
applicable, at the most recent redetermination of interest on such series, in
accordance with accepted financial practice.
ARTICLE TWO
SECURITIES
SECTION 2.1 FORMS GENERALLY. The Securities of each series and the
Coupons, if any, to be attached thereto shall be substantially in such form
(not inconsistent with this Indenture) as shall be established by or pursuant
to one or more Board Resolutions (as set forth in a Board Resolution or, to
the extent established pursuant to rather than set forth in a Board
Resolution, an Officers' Certificate detailing such establishment) or in one
or more indentures supplemental hereto, in each case with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture and may have imprinted or otherwise reproduced
thereon such letters, numbers or other marks of identification and such
legend or legends or endorsements, not inconsistent with the provisions of
this Indenture, as may be required to comply with any law or with any rules
or regulations pursuant thereto, or with any rules of any securities exchange
or to conform to general usage, all as may be determined by the officers
executing such Securities and Coupons, if any, as evidenced by their
execution of such Securities and Coupons.
The definitive Securities and Coupons, if any, shall be printed,
lithographed or engraved on steel engraved borders or
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may be produced in any other manner, all as determined by the officers
executing such Securities and Coupons, if any, as evidenced by their
execution of such Securities and Coupons.
SECTION 2.2 FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION. The
Trustee's certificate of authentication on all Securities shall be in
substantially the following form:
"This is one of the Securities referred to in the within-mentioned
Indenture.
The First National Bank of Chicago,
as Trustee
By____________________________
Authorized Officer"
If at any time there shall be an Authenticating Agent appointed with
respect to any series of Securities, then the Securities of such series shall
bear, in addition to the Trustee's certificate of authentication, an
alternate certificate of authentication which shall be substantially as
follows:
"This is one of the Securities referred to in the within-mentioned
Indenture.
The First National Bank of Chicago,
as Trustee
By______________________________,
as Authenticating Agent
By______________________________
Authorized Officer"
SECTION 2.3 AMOUNT UNLIMITED; ISSUABLE IN SERIES. The aggregate
principal amount of Securities which may be authenticated and delivered under
this Indenture is unlimited.
The Securities may be issued in one or more series, and each such series
shall rank pari passu with all other unsecured and unsubordinated debt of the
Issuer. There shall be established in or pursuant to one or more Board
Resolutions (and to the extent established pursuant to rather than set forth
in a Board Resolution, in an Officers' Certificate detailing such
establishment) or established in one or more indentures supplemental hereto,
prior to the initial issuance of Securities of any series:
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(1) the designation of the Securities of such series, which shall
distinguish the Securities of such series from the Securities of all other
series;
(2) any limit upon the aggregate principal amount of the Securities
of such series that may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities of such
series pursuant to Section 2.8, 2.9, 2.11, 8.5 or 12.3);
(3) if other than Dollars, the coin or currency in which the
Securities of such series are denominated (including, but not limited to,
any Foreign Currency or ECU);
(4) the date or dates on which the principal of the Securities of
such series is payable;
(5) the rate or rates at which the Securities of such series shall
bear interest, if any, the date or dates from which such interest shall
accrue, on which such interest shall be payable and (in the case of
Registered Securities) on which a record shall be taken for the
determination of Holders to whom interest is payable and/or the method by
which such rate or rates or date or dates shall be determined;
(6) the place or places where the principal of and any interest on
Securities of such series shall be payable (if other than as provided in
Section 3.2);
(7) the right, if any, of the Issuer to redeem Securities of such
series, in whole or in part, at its option and the period or periods within
which, the price or prices at which and any terms and conditions upon which
Securities of such series may be so redeemed, pursuant to any sinking fund
or otherwise;
(8) the obligation, if any, of the Issuer to redeem, purchase or
repay Securities of such series pursuant to any mandatory redemption,
sinking fund or analogous provisions or at the option of a Holder thereof
and the price or prices at which and the period or periods within which and
any terms and conditions upon which Securities of such series shall be
redeemed, purchased or repaid, in whole or in part, pursuant to such
obligation;
(9) if other than denominations of $1,000 and any integral multiple
thereof in the case of Registered Securities, or $1,000 and $5,000 in the
case of Unregistered
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Securities, the denominations in which securities of such series shall
be issuable;
(10) if other than the principal amount thereof, the portion of the
principal amount of Securities of such series which shall be payable upon
declaration of acceleration of the maturity thereof;
(11) if other than the coin or currency in which the Securities of
such series are denominated, the coin or currency in which payment of the
principal of or interest on the Securities of such series shall be payable;
(12) if the principal of or interest on the Securities of such series
are to be payable, at the election of the Issuer or a Holder thereof, in a
coin or currency other than that in which the Securities of such series are
denominated, the period or periods within which, and the terms and
conditions upon which, such election may be made;
(13) if the amount of payments of the principal of and interest on
the Securities of such series may be determined with reference to an index
based on a coin or currency other than that in which the Securities of such
series are denominated, the manner in which such amounts shall be
determined;
(14) whether the Securities of such series will be issuable as
Registered Securities (and if so, whether such Securities will be issuable
as Registered Global Securities) or Unregistered Securities (with or
without Coupons), or any combination of the foregoing, any restrictions
applicable to the offer, sale or delivery of Unregistered Securities or the
payment of interest thereon and, if other than as provided in Section 2.8,
the terms upon which Unregistered Securities of such series may be
exchanged for Registered Securities of such series and vice versa;
(15) if the Securities of such series are to be issuable in
definitive form (whether upon original issue or upon exchange of a
temporary Security of such series) only upon receipt of certain
certificates or other documents or satisfaction of other conditions, the
form and terms of such certificates, documents or conditions;
(16) any trustees, depositories, authenticating or paying agents,
transfer agents or registrars or any other agents with respect to the
Securities of such series;
(17) any additions to or deletions from the events of default or
covenants with respect to the Securities of such series;
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(18) with respect to Unregistered Securities, the countries, cities
and/or newspaper or newspapers in such countries or cities in which notices
required pursuant to Sections 5.11, 6.8, 6.10(a), 6.11, 8.2, 10.4, 11.4,
12.2 and 12.5 are to be published (and unless otherwise specified in such
Board Resolution or supplemental indenture or any Officers' Certificate
delivered pursuant thereto, such newspaper will, if practicable, be (a) in
the case of The City of New York, The Wall Street Journal (Eastern
Edition), (b) in the case of the United Kingdom, The Financial Times
(London Edition) and (c) in the case of Luxembourg, The Luxemburger Wort);
and
(19) any other terms of such series (which terms shall not adversely
affect the interests of any Holders of Securities then Outstanding).
All Securities of any one series and Coupons, if any, appertaining
thereto shall be substantially identical, except in the case of Registered
Securities as to denomination and except as may otherwise be provided by or
pursuant to the Board Resolution or Officers' Certificate referred to above
or as set forth in any indenture supplemental hereto referred to above. All
Securities of any one series need not be issued at the same time and may be
issued from time to time, consistent with the terms of this Indenture, if so
provided by or pursuant to such Board Resolution, such Officers' Certificate
or in any such indenture supplemental hereto.
SECTION 2.4 AUTHENTICATION AND DELIVERY OF SECURITIES. The Issuer may
from time to time deliver Securities of any series, having attached thereto
appropriate Coupons, if any, executed by the Issuer to the Trustee for
authentication, together with the applicable documents referred to below in
this Section, and the Trustee shall thereupon authenticate and deliver such
Securities to or upon the order of the Issuer (contained in the Issuer Order
referred to below in this Section) or pursuant to such procedures acceptable
to the Trustee and to such recipients as may be specified from time to time
by an Issuer Order. If so provided in or pursuant to the Board Resolution or
supplemental indenture establishing the Securities of any series, the
maturity date, original issue date, interest rate and any other terms of any
or all of the Securities of such series and the Coupons, if any, appertaining
thereto may be determined by or pursuant to such Issuer Order and procedures.
If provided for in such procedures, such Issuer Order may authorize
authentication and delivery pursuant to oral or electronic instructions from
the Issuer or its duly authorized agent, which instructions shall be promptly
confirmed in writing. In authenticating such Securities and accepting the
additional responsibilities under this Indenture in relation to such
Securities, the Trustee shall be entitled to receive (but, in the case of
subparagraphs 2, 3 and 4 below, only
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at or before the time of the first request of the Issuer to the Trustee to
authenticate Securities of such series) and (subject to Section 6.1) shall be
fully protected in relying upon, unless and until such documents have been
superseded or revoked:
(1) an Issuer Order requesting such authentication and setting forth
delivery instructions if the securities and the Coupons, if any, are not to
be delivered to the Issuer, provided that, with respect to Securities of a
series subject to a Periodic Offering, (a) such Issuer Order may be
delivered by the Issuer to the Trustee at any time prior to the delivery to
the Trustee of the Securities of such series for authentication and
delivery, (b) the Trustee shall authenticate and deliver the Securities of
such series for original issue from time to time, in an aggregate principal
amount not exceeding the aggregate principal amount established for such
series, pursuant to an Issuer Order or pursuant to such procedures
acceptable to the Trustee as may be specified from time to time by an
Issuer Order, (c) if so provided in or pursuant to the Board Resolution or
supplemental indenture establishing the Securities of such series, the
maturity date, original issue date, interest rate and any other terms of
any or all of the Securities of such series may be determined by an Issuer
Order or pursuant to such procedures and (d) if provided for in such
procedures, such Issuer Order may authorize authentication and delivery
pursuant to oral or electronic instructions from the Issuer or its duly
authorized agent, which instructions shall be promptly confirmed in
writing;
(2) any Board Resolution, Officers' Certificate and/or executed
supplemental indenture referred to in Sections 2.1 and 2.3 by or pursuant
to which the forms and terms of the Securities of such series and the
Coupons, if any, were established;
(3) an Officers' Certificate setting forth the form or forms and
terms of the Securities of such series and the Coupons, if any, stating
that such form or forms and terms have been established pursuant to
Sections 2.1 and 2.3 and comply with this Indenture, and covering such
other matters as the Trustee may reasonably request; and
(4) at the option of the Issuer, either an Opinion of Counsel, or a
letter addressed to the Trustee permitting it to rely on an Opinion of
Counsel, substantially to the effect that:
(a) the forms of the Securities of such series and the Coupons,
if any, have been duly authorized and established in conformity with
the provisions of this Indenture;
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(b) in the case of an underwritten offering, the terms of the
Securities of such series have been duly authorized and established in
conformity with the provisions of this Indenture, and, in the case of
an offering that is not underwritten, certain terms of the Securities
of such series have been established pursuant to a Board Resolution,
an Officers' Certificate or a supplemental indenture in accordance
with the provisions of this Indenture and when such other terms as are
to be established pursuant to an Issuer Order or procedures set forth
in an Issuer Order shall have been established, all such terms will
have been duly authorized by the Issuer and will have been established
in conformity with the provisions of this Indenture;
(c) when the Securities of such series and the Coupons, if any,
have been executed by the Issuer and authenticated by the Trustee in
accordance with the provisions of this Indenture and delivered to and
duly paid for by the purchasers thereof, they will have been duly
issued under this Indenture and will be valid and legally binding
obligations of the Issuer, enforceable in accordance with their
respective terms, subject to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to or affecting the
enforcement of creditors' rights and to general principles of equity,
and will be entitled to the benefits of this Indenture;
(d) the execution and delivery by the Issuer of, and the
performance by the Issuer of its obligations under, the Securities and
Coupons, if any, will not contravene any provision of applicable law
or the certificate of incorporation or by-laws of the Issuer or, to
the best knowledge of such counsel, (i) any agreement or other
instrument binding upon the Issuer or any of its subsidiaries that is
material to the Issuer and its subsidiaries, considered as one
enterprise, or (ii) any judgment, order or decree of any governmental
body, agency or court having jurisdiction over the Issuer or any of
its subsidiaries; and
(e) no consent, approval, authorization, order, registration or
qualification of or with any governmental agency or body having
jurisdiction over the Issuer is required for the execution and
delivery of the Securities of such series by the Issuer, except such
as have been obtained (except that no opinion need be expressed as to
state securities or Blue Sky laws).
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The Trustee shall have the right to decline to authenticate and
deliver any Securities of any series under this Section (other than
Securities the forms and terms of which shall have been established by
supplemental indenture) if the Trustee, being advised by counsel, determines
that such action may not lawfully be taken by the Issuer or if the Trustee in
good faith by its board of directors or board of trustees, executive
committee or a trust committee of directors, trustees or Responsible Officers
shall determine that such action would expose the Trustee to personal
liability to existing Holders or would affect the Trustee's rights, duties or
immunities under the Securities of any such series, this Indenture or
otherwise.
If the Issuer shall establish pursuant to Section 2.3 that the
Securities of a series are to be issued in the form of one or more Registered
Global Securities, then the Issuer shall execute and the Trustee shall, in
accordance with this Section and the Issuer Order with respect to such
series, authenticate and deliver one or more Registered Global Securities
that (i) shall be in an aggregate amount equal to the aggregate principal
amount specified in such Issuer Order, (ii) shall be registered in the name
of the Depositary therefor or its nominee, (iii) shall be delivered by the
Trustee to such Depositary or pursuant to such Depositary's instructions and
(iv) shall bear a legend substantially to the following effect: "Unless and
until it is exchanged in whole or in part for Securities in definitive
registered form, this Security may not be transferred except as a whole by
the Depositary to the nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary or by the
Depositary or any such nominee to a successor Depositary or a nominee of such
successor Depositary."
Each Depositary designated pursuant to Section 2.3 must, at the
time of its designation and at all times while it serves as Depositary, be a
clearing agency registered under the Exchange Act and any other applicable
statute or regulation.
SECTION 2.5 EXECUTION OF SECURITIES. The Securities shall be
signed on behalf of the Issuer by both (a) its Chairman of the Board of
Directors or its President or any Vice President (whether or not designated
by a number or numbers or a word or words added before or after the title
"Vice President") and (b) by its Treasurer or any Assistant Treasurer or its
Secretary or any Assistant Secretary, under its corporate seal (except in the
case of Coupons) which may, but need not, be attested. Such signatures may
be the manual or facsimile signatures of the present or any future such
officers. The seal of the Issuer may be in the form of a facsimile thereof
and may be impressed, affixed, imprinted or otherwise reproduced on the
Securities. Typographical and other minor errors or defects in any such
reproduction of the seal or any such signature shall not affect the validity
or enforceability of any Security that has been duly
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authenticated and delivered by the Trustee. The Coupons, if any, applicable
to the Securities of any series shall bear the facsimile signature of the
Treasurer or any Assistant Treasurer of the Issuer.
In case any officer of the Issuer who shall have so signed any of the
Securities or Coupons, if any, shall cease to be such officer before the
Security or Coupon so signed (or the Security to which the Coupon so signed
appertains) shall be authenticated and delivered by the Trustee or disposed
of by the Issuer, such Security or Coupon nevertheless may be authenticated
and delivered or disposed of as though the person who signed such Security or
Coupon had not ceased to be such officer of the Issuer; and any Security or
Coupon may be so signed on behalf of the Issuer by such persons as, at the
actual date of the execution of such Security or Coupon, shall be the proper
officers of the Issuer, although at the date of the execution and delivery of
this Indenture any such person was not such an officer.
SECTION 2.6 CERTIFICATE OF AUTHENTICATION. Only such Securities
as shall bear thereon a certificate of authentication substantially in the
form hereinbefore recited, executed by the Trustee by the manual signature of
one of its authorized officers, shall be entitled to the benefits of this
Indenture or be valid or obligatory for any purpose. No Coupon shall be
entitled to the benefits of this Indenture or shall be valid and obligatory
for any purpose until the certificate of authentication on the Security to
which such Coupon appertains shall have been duly executed by the Trustee.
The execution of such certificate by the Trustee upon any Security executed
by the Issuer shall be conclusive evidence that the Security so authenticated
has been duly authenticated and delivered hereunder and that the Holder is
entitled to the benefits of this Indenture.
SECTION 2.7 DENOMINATION AND DATE OF SECURITIES, PAYMENTS OF
INTEREST. The Securities of each series shall be issuable as Registered
Securities or Unregistered Securities in denominations established as
contemplated by Section 2.3 or, with respect to the Registered Securities of
any series, if not so established, in denominations of $1,000 and any
integral multiple thereof. If denominations of Unregistered Securities of
any series are not so established, such Securities shall be issuable in
denominations of $1,000 and $5,000. The Securities of each series shall be
numbered, lettered or otherwise distinguished in such manner or in accordance
with such plan as the officers of the Issuer executing the same may determine
with the approval of the Trustee, as evidenced by the execution and
authentication thereof.
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Each Registered Security shall be dated the date of its
authentication. Each Unregistered Security shall be dated as established in
or pursuant to the Board Resolution or supplemental indenture referred to in
Section 2.3. The Securities of each series shall bear interest, if any, from
the date, and such interest shall be payable on the dates, established as
contemplated by Section 2.3.
Except as may otherwise be established pursuant to Section 2.3, the
Person in whose name any Registered Security of any series is registered at
the close of business on any Record Date applicable to such series with
respect to any interest payment date for such series shall be entitled to
receive the interest, if any, payable on such interest payment date
notwithstanding any transfer or exchange of such Registered Security
subsequent to the Record Date and prior to such interest payment date, except
if and to the extent the Issuer shall default in the payment of the interest
due on such interest payment date, in which case such defaulted interest may,
at the option of the Issuer, be paid to the Persons in whose names
Outstanding Registered Securities of such series are registered at the close
of business on a subsequent special Record Date (which shall be not less than
five Business Days prior to the date of payment of such defaulted interest)
established by notice given by mail by or on behalf of the Issuer to the
Holders of Registered Securities of such series not less than 15 days
preceding such subsequent special Record Date. The term "Record Date", as
used with respect to any interest payment date (except a special Record Date
set for payment of defaulted interest) for the Securities of any series,
shall mean the date specified as such in the terms of the Registered
Securities of such series established as contemplated by Section 2.3.
SECTION 2.8 REGISTRATION, TRANSFER AND EXCHANGE. The Issuer will
keep, or cause to be kept, at the Corporate Trust Office or at another office
or agency to be maintained for the purpose as provided in Section 3.2, for
each series of Securities a register (the "Security Register") in which,
subject to such reasonable regulations as it may prescribe, it will provide
for the registration of Registered Securities of such series and the
registration of transfer of Registered Securities of such series. The
Security Register shall be in written form in the English language or in any
other form capable of being converted into such form within a reasonable
time. At all reasonable times such register not maintained by the Trustee
shall be open for inspection by the Trustee. Unless and until otherwise
determined by the Issuer pursuant to Section 2.3, the Security Register with
respect to each series of Registered Securities shall be kept solely at the
Corporate Trust Office and, for this purpose, the Trustee shall be designated
the "Security Registrar".
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Upon due presentation for registration of transfer of any
Registered Security of any series at any office or agency to be maintained
for the purpose as provided in Section 3.2 for such series, the Issuer shall
execute and the Trustee shall authenticate and deliver in the name of the
transferee or transferees a new Registered Security or Registered Securities
of the same series, maturity date and interest rate in authorized
denominations for a like aggregate principal amount.
Unregistered Securities (except for any temporary global
Unregistered Securities) and Coupons (except for Coupons attached to any
temporary global Unregistered Securities) shall be transferable by delivery.
At the option of the Holder thereof, Registered Securities of any
series (other than a Registered Global Security, except as set forth below)
may be exchanged for one or more Registered Securities of such series in
authorized denominations for a like aggregate principal amount, upon
surrender of such Registered Securities to be exchanged at the office or
agency to be maintained for such purpose in accordance with Section 3.2 and
upon payment, if the Issuer shall so require, of the charges hereinafter
provided. If the Securities of any series are issued in both registered and
unregistered form, except as otherwise specified for a particular series
pursuant to Section 2.3, at the option of the Holder thereof, Unregistered
Securities of any series may be exchanged for Registered Securities of such
series in authorized denominations for a like aggregate principal amount,
upon surrender of such Unregistered Securities to be exchanged at the office
or agency to be maintained for such purpose in accordance with Section 3.2,
with, in the case of Unregistered Securities that have Coupons attached, all
unmatured Coupons and all matured Coupons in default thereto appertaining,
and upon payment, if the Issuer shall so require, of the charges hereinafter
provided. At the option of the Holder thereof, if Unregistered Securities of
any series, maturity date, interest rate and original issue date are issued
in more than one authorized denomination, except as otherwise specified for a
particular series pursuant to Section 2.3, such Unregistered Securities may
be exchanged for other Unregistered Securities of such series in authorized
denominations for a like aggregate principal amount, upon surrender of such
Unregistered Securities to be exchanged at the office or agency to be
maintained for such purpose in accordance with Section 3.2 or as specified
for a particular series pursuant to Section 2.3, with, in the case of
Unregistered Securities that have Coupons attached, all unmatured Coupons and
all matured Coupons in default thereto appertaining, and upon payment, if the
Issuer shall so require, of the charges hereinafter provided. Unless
otherwise specified for a particular series pursuant to Section 2.3,
Registered Securities of any series may not be exchanged for Unregistered
Securities of such series. Whenever
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any securities are so surrendered for exchange, the Issuer shall execute, and
the Trustee shall authenticate and deliver, the Securities which the Holder
making the exchange is entitled to receive. All Securities and Coupons
surrendered upon any exchange or transfer provided for in this Indenture
shall be promptly cancelled and disposed of (subject to the record retention
requirements of the Exchange Act) by the Trustee and the Trustee will deliver
a certificate of disposition thereof to the Issuer.
All Registered Securities presented for registration of transfer,
exchange, redemption or payment shall (if so required by the Issuer or the
Trustee) be duly endorsed by, or be accompanied by a written instrument or
instruments of transfer in form satisfactory to the Issuer and the Trustee
duly executed by, the Holder or his attorney duly authorized in writing.
The Issuer may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any exchange
or registration of transfer of Securities. No service charge shall be made
for any such transaction.
The Issuer shall not be required to (a) issue, exchange or register a
transfer of any Securities of any series for a period of 15 days next
preceding the first mailing or publication of notice of redemption of
Securities of such series to be redeemed, (b) exchange or register the
transfer of any Securities selected, called or being called for redemption,
in whole or in part, except, in the case of any Security to be redeemed in
part, the portion thereof not so to be redeemed or (c) register the transfer
of or exchange any Security if the Holder thereof has exercised his right, if
any, to require the Issuer to repurchase such Security, in whole or in part,
except the portion of such Security required to be repurchased.
Notwithstanding any other provision of this Section, unless and until it
is exchanged in whole or in part for Securities in definitive registered
form, a Registered Global Security representing all or a portion of the
Securities of a series may not be transferred except as a whole by the
Depositary for such Registered Global Security to a nominee of such
Depositary or by a nominee of such Depositary to such Depositary or another
nominee of such Depositary or by such Depositary or any such nominee to a
successor Depositary for such Registered Global Security or a nominee of such
successor Depositary.
If at any time a Depositary for any Registered Securities of a series
represented by one or more Registered Global Securities notifies the Issuer
that it is unwilling or unable to continue as Depositary for such Registered
Securities or if at any time any such Depositary shall no longer be eligible
under Section 2.4,
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the Issuer shall appoint a successor Depositary with respect to the
Registered Securities held by such Depositary. If a successor Depositary is
not appointed by the Issuer within 90 days after the Issuer receives such
notice or becomes aware of such ineligibility, the Registered Securities of
such series shall no longer be represented by one or more Registered Global
Securities held by such Depositary, and the Issuer shall execute, and the
Trustee, upon receipt of an Issuer Order for the authentication and delivery
of definitive Securities of such series, shall authenticate and deliver
Securities of such series in definitive registered form without Coupons, in
any authorized denominations and in an aggregate principal amount equal to
the principal amount of the Registered Global Security or Securities held by
such Depositary in exchange for such Registered Global Security or Securities.
Within seven days after the occurrence of an Event of Default specified
in clause (a), (b) or (c) of Section 5.1 with respect to any series of
Securities that is, in whole or in part, represented by a Registered Global
Security, the Issuer shall execute, and the Trustee shall authenticate and
deliver, Securities of such series in definitive registered form without
coupons, in any authorized denominations and in an aggregate principal amount
equal to the principal amount of the Registered Global Security or Securities
representing Registered Securities of such series in exchange for such
Registered Global Security or Securities.
The Issuer may at any time and in its sole discretion determine that the
Registered Securities of a particular series shall no longer be represented
by a Registered Global Security or Securities. In such event, the Issuer
shall execute, and the Trustee, upon receipt of an Issuer Order for the
authentication and delivery of definitive Securities of such series, shall
authenticate and deliver, Securities of such series in definitive registered
form without Coupons, in any authorized denominations and in an aggregate
principal amount equal to the principal amount of the Registered Global
Security or Securities representing Registered Securities of such series in
exchange for such Registered Global Security or Securities.
If so specified by the Issuer pursuant to Section 2.3 with respect to
Securities of a particular series represented by a Registered Global
Security, the Depositary for such Registered Global Security may surrender
such Registered Global Security in exchange in whole or in part for
Securities of such series in definitive registered form on such terms as are
acceptable to the Issuer and such Depositary. Thereupon, the Issuer shall
execute, and the Trustee shall authenticate and deliver:
(i) to each Person specified by such Depositary a new Registered
Security or securities of such series, in any
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authorized denominations requested by such Person, in an aggregate
principal amount equal to, and in exchange for, such Person's beneficial
interest in the Registered Global Security; and
(ii) to such Depositary a new Registered Global security in a
denomination equal to the difference between the principal amount of the
surrendered Registered Global Security and the aggregate principal amount
of Registered Securities authenticated and delivered pursuant to clause (i)
above.
Upon the exchange of any Registered Global Security for Securities
in definitive registered form without Coupons, in authorized denominations,
such Registered Global Security shall be canceled by the Trustee or an agent
of the Issuer or the Trustee. Securities in definitive registered form
without Coupons issued in exchange for a Registered Global Security pursuant
to this Section shall be registered in such names and in such authorized
denominations as the Depositary for such Registered Global Security, pursuant
to instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee or an agent of the Issuer or the Trustee. The Trustee
or such agent shall deliver such Securities to or as directed by the Persons
in whose names such Securities are so registered.
All Securities issued upon any registration of transfer or exchange
of Securities shall be valid obligations of the Issuer, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
Notwithstanding anything herein or in the terms of any series of
Securities to the contrary, none of the Issuer, the Trustee or any agent of
the Issuer or the Trustee (any of which, other than the Issuer, shall rely on
an Officers' Certificate and an Opinion of Counsel) shall be required to
exchange any Unregistered Security for a Registered Security if such exchange
would result in adverse Federal income tax consequences to the Issuer (such
as, for example, the inability of the Issuer to deduct from its income, as
computed for Federal income tax purposes, the interest payable on the
Unregistered Securities) under then applicable United States Federal income
tax laws.
SECTION 2.9 MUTILATED, DEFACED, DESTROYED, LOST AND STOLEN
SECURITIES. In case any temporary or definitive Security or any Coupon
appertaining to any Security shall become mutilated, defaced or be destroyed,
lost or stolen, the Issuer shall execute, and upon receipt of an Issuer
Order, the Trustee shall authenticate and deliver a new Security of the same
series, maturity date, interest rate and original issue date, bearing a
number or other distinguishing symbol not contemporaneously
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outstanding, in exchange and substitution for the mutilated or defaced
Security, or in lieu of and in substitution for the Security so destroyed,
lost or stolen, with Coupons corresponding to the Coupons appertaining to the
Securities so mutilated, defaced, destroyed, lost or stolen, or in exchange
or substitution for the Security to which such mutilated, defaced, destroyed,
lost or stolen Coupon appertained, with Coupons appertaining thereto
corresponding to the Coupons so mutilated, defaced, destroyed, lost or
stolen. In every case the applicant for a substitute Security or Coupon
shall furnish to the Issuer and to the Trustee and any agent of the Issuer or
the Trustee such security or indemnity as may be required by them to
indemnify and defend and to save each of them harmless and, in every case of
destruction, loss or theft, evidence to their satisfaction of the
destruction, loss or theft of such Security or Coupon and of the ownership
thereof and, in the case of mutilation or defacement, shall surrender the
Security and related Coupons to the Trustee or such agent.
Upon the issuance of any substitute Security or Coupon, the Issuer
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee or its agent)
connected therewith. In case any Security or Coupon which has matured or is
about to mature or has been called for redemption in full shall become
mutilated or defaced or be destroyed, lost or stolen, the Issuer may, instead
of issuing a new or substitute Security, pay or authorize the payment of the
same or the relevant Coupon (without surrender thereof except in the case of
a mutilated or defaced Security or Coupon), if the applicant for such payment
shall furnish to the Issuer and to the Trustee and any agent of the Issuer or
the Trustee such security or indemnity as may be required by them to save
each of them harmless, and, in every case of destruction, loss or theft,
evidence to their satisfaction of the destruction, loss or theft of such
Security or Coupon and of the ownership thereof and, in the case of
mutilation or defacement, shall surrender the Security and related Coupons to
the Trustee or such agent.
Every substitute Security or Coupon of any series issued pursuant to the
provisions of this Section by virtue of the fact that any such Security or
Coupon is destroyed, lost or stolen shall constitute an additional
contractual obligation of the Issuer, whether or not the destroyed, lost or
stolen Security or Coupon shall be at any time enforceable by anyone and
shall be entitled to all the benefits of (but shall be subject to all the
limitations of rights set forth in) this Indenture equally and
proportionately with any and all other Securities or Coupons of such series
duly authenticated and delivered hereunder. All Securities and Coupons shall
be held and owned upon the express condition that, to the extent permitted by
law, the foregoing
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provisions are exclusive with respect to the replacement or payment of
mutilated, defaced, destroyed, lost or stolen Securities and Coupons and
shall preclude any and all other rights or remedies notwithstanding any law
or statute existing or hereafter enacted to the contrary with respect to the
replacement or payment of negotiable instruments or other securities without
their surrender.
SECTION 2.10 CANCELLATION OF SECURITIES; DISPOSITION THEREOF. All
Securities and Coupons surrendered for payment, redemption, registration of
transfer or exchange, or for credit against any payment in respect of a
sinking or analogous fund, if surrendered to the Issuer or any agent of the
Issuer or any agent of the Trustee, shall be delivered to the Trustee or its
agent for cancellation or, if surrendered to the Trustee, shall be canceled
by it; and no Securities or Coupons shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this Indenture. The Trustee
or its agent shall dispose of canceled Securities and Coupons held by it
(subject to the record retention requirements of the Exchange Act) and
deliver a certificate of disposition to the Issuer. If the Issuer or its
agent shall acquire any of the Securities or Coupons, such acquisition shall
not operate as a redemption or satisfaction of the indebtedness represented
by such Securities or Coupons unless and until the same are delivered to the
Trustee or its agent for cancellation.
SECTION 2.11 TEMPORARY SECURITIES. Pending the preparation of
definitive Securities for any series, the Issuer may execute and the Trustee
shall authenticate and deliver temporary Securities for such series (printed,
lithographed, typewritten or otherwise reproduced, in each case in form
satisfactory to the Trustee). Temporary Securities of any series shall be
issuable as Registered Securities without coupons, or as Unregistered
Securities with or without coupons attached thereto, of any authorized
denomination, and substantially in the form of the definitive Securities of
such series but with such omissions, insertions and variations as may be
appropriate for temporary Securities, all as may be determined by the Issuer
with the concurrence of the Trustee as evidenced by the execution and
authentication thereof. Temporary Securities may contain such references to
any provisions of this Indenture as may be appropriate. Every temporary
Security shall be executed by the Issuer and be authenticated by the Trustee
upon the same conditions and in substantially the same manner, and with like
effect, as the definitive Securities. Without unreasonable delay the Issuer
shall execute and shall furnish definitive Securities of such series and
thereupon temporary Registered Securities of such series may be surrendered
in exchange for such definitive Securities in registered form without charge
at each office or agency to be maintained for such purpose in accordance with
Section 3.2 and, in the case of Unregistered Securities, at any
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office or agency to be maintained for such purpose as specified pursuant to
Section 2.3, and the Trustee shall authenticate and deliver in exchange for
such temporary Securities of such series an equal aggregate principal amount
of definitive Securities of the same series in authorized denominations and,
in the case of Unregistered Securities, having attached thereto any
appropriate Coupons. Until so exchanged, the temporary Securities of any
series shall be entitled to the same benefits under this Indenture as
definitive Securities of such series, unless otherwise established pursuant
to Section 2.3. The provisions of this Section are subject to any
restrictions or limitations on the issue and delivery of temporary
Unregistered Securities of any series that may be established pursuant to
Section 2.3 (including any provision that Unregistered Securities of such
series initially be issued in the form of a single global Unregistered
Security to be delivered to a depositary or agency located outside the United
States and the procedures pursuant to which definitive Unregistered
Securities of such series would be issued in exchange for such temporary
global Unregistered Security).
ARTICLE THREE
COVENANTS OF THE ISSUER
SECTION 3.1 PAYMENT OF PRINCIPAL AND INTEREST. The Issuer covenants
and agrees for the benefit of each series of Securities that it will duly and
punctually pay or cause to be paid the principal of, and interest on, each of
the Securities of such series (together with any additional amounts payable
pursuant to the terms of such Securities) at the place or places, at the
respective times and in the manner provided in such Securities and in the
Coupons, if any, appertaining thereto and in this Indenture. The interest on
Securities with Coupons attached (together with any additional amounts
payable pursuant to the terms of such Securities) shall be payable only upon
presentation and surrender of the several Coupons for such interest
installments as are evidenced thereby as they severally mature. If any
temporary Unregistered Security provides that interest thereon may be paid
while in temporary form, the interest on any such temporary Unregistered
Security (together with any additional amounts payable pursuant to the terms
of such Security) shall be paid, as to the installments of interest evidenced
by Coupons attached thereto, if any, only upon presentation and surrender
thereof, and, as to the other installments of interest, if any, only upon
presentation of such temporary Unregistered Security for notation thereon of
the payment of such interest, in each case subject to any restrictions that
may be established pursuant to Section 2.3. The interest on Registered
Securities (together with any additional amounts payable pursuant to the
terms of such Securities) shall
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be payable only to or upon the written order of the Holders thereof and, at
the option of the Issuer (unless otherwise specified in such Securities), may
be paid by wire transfer or by mailing checks for such interest payable to or
upon the written order of such Holders at their last addresses as they appear
on the registry books of the Issuer.
Principal and interest shall be considered paid on the date due if on
such date the Trustee or the paying agent holds in accordance with this
Indenture money sufficient to pay all principal and interest then due and the
Trustee or the paying agent, as the case may be, is not prohibited pursuant
to the terms of this Indenture from paying such money to the Securityholders
on that date.
SECTION 3.2 OFFICES FOR PAYMENTS, ETC. So long as any Registered
Securities are outstanding hereunder, the Issuer will maintain in the Borough
of Manhattan, The City of New York, an office or agency where the Registered
Securities of each series may be presented for payment, where the Securities
of each series may be presented for exchange as in this Indenture provided
and where the Registered Securities of each series may be presented for
registration of transfer as in this Indenture provided.
In the event that the Issuer shall issue any Unregistered Securities, it
will maintain one or more offices or agencies in a city or cities located
outside the United States (including any city in which such an office or
agency is required to be maintained under the rules of any stock exchange on
which the Securities of any series are listed) where the Unregistered
Securities, if any, of each series and Coupons, if any, appertaining thereto
may be presented for payment. No payment on any Unregistered Security or
Coupon will be made upon presentation of such Unregistered Security or Coupon
at an office or agency of the Issuer within the United States, nor will any
payment be made by transfer to an account in, or by mail to an address in,
the United States unless pursuant to applicable United States laws and
regulations then in effect such payment can be made without adverse tax
consequences to the Issuer. Notwithstanding the foregoing, payments in
Dollars on Unregistered Securities of any series and Coupons appertaining
thereto which are payable in Dollars may be made at an office or agency of
the Issuer maintained in the Borough of Manhattan, The City of New York, if
such payment in Dollars at each office or agency maintained by the Issuer
outside the United States for payment on such Unregistered Securities is
illegal or effectively precluded by exchange controls or other similar
restrictions.
The Issuer will maintain in the Borough of Manhattan, The City of New
York, an office or agency where notices and demands to or upon the Issuer in
respect of the Securities of any series, the Coupons appertaining thereto or
this Indenture may be served.
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The Issuer will give to the Trustee written notice of the location of
each such office or agency and of any change of location thereof. In case
the Issuer shall fail to maintain any office or agency required by this
Section to be located in the Borough of Manhattan, The City of New York, or
shall fail to give such notice of the location or of any change in the
location of any of the above offices or agencies, presentations and demands
may be made and notices may be served at the Corporate Trust Office of the
Trustee.
The Issuer may from time to time designate one or more additional
offices or agencies where the Securities of any series and any Coupons
appertaining thereto may be presented for payment, where the Securities of
such series may be presented for exchange as in this Indenture provided and
where the Registered Securities of such series may be presented for
registration of transfer as in this Indenture provided, and the Issuer may
from time to time rescind any such designation; PROVIDED, HOWEVER, that no
such designation or rescission shall in any manner relieve the Issuer of its
obligation to maintain any office or agency required to be provided for in
this Section. The Issuer will give to the Trustee prompt written notice of
any such designation or rescission thereof.
SECTION 3.3 APPOINTMENT TO FILL A VACANCY IN OFFICE OF TRUSTEE.
The Issuer, whenever necessary to avoid or fill a vacancy in the office of
Trustee, will appoint, in the manner provided in Section 6.10, a Trustee, so
that there shall at all times be a Trustee with respect to each series of
Securities hereunder.
SECTION 3.4 PAYING AGENTS. Whenever the Issuer shall appoint a
paying agent other than the Trustee with respect to the Securities of any
series, it will cause such paying agent to execute and deliver to the Trustee
an instrument in which such agent shall agree with the Trustee, subject to
the provisions of this Section:
(a) that it will hold all sums received by it as such agent for the
payment of the principal of or interest on the Securities of such series
(whether such sums have been paid to it by the Issuer or by any other
obligor on the Securities of such series) in trust for the benefit of the
Holders of the Securities of such series and the Coupons appertaining
thereto, if any, or of the Trustee, and
(b) that it will give the Trustee notice of any failure by the Issuer
(or by any other obligor on the Securities of such series) to make any
payment of the principal of or interest on the Securities of such series
when the same shall be due and payable, and
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(c) that at any time during the continuance of any such failure
referred to in the foregoing paragraph (b), it will upon written request of
the Trustee forthwith pay to the Trustee all sums so held in trust by such
agent.
The Issuer will, on or prior to each due date of the principal of
or interest on the Securities of any series, deposit with the paying agent a
sum sufficient to pay such principal or interest so becoming due, and (unless
such paying agent is the Trustee) the Issuer will promptly notify the Trustee
of any failure to take such action.
If the Issuer shall act as its own paying agent with respect to the
Securities of any series, it will, on or before each due date of the
principal of or interest on the Securities of such series, set aside,
segregate and hold in trust for the benefit of the Holders of the Securities
of such series or the Coupons, if any, appertaining thereto a sum sufficient
to pay such principal or interest so becoming due. The Issuer will promptly
notify the Trustee of any failure to take such action.
Anything in this section to the contrary notwithstanding, but
subject to Section 10.1, the Issuer may at any time, for the purpose of
obtaining a satisfaction and discharge with respect to one or more or all
series of Securities hereunder, or for any other reason, pay or cause to be
paid to the Trustee all sums held in trust for any such series by the Issuer
or any paying agent hereunder, as required by this Section, such sums to be
held by the Trustee upon the trusts herein contained.
Anything in this Section to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section is subject to the
provisions of Sections 10.3 and 10.4.
SECTION 3.5 WRITTEN STATEMENT TO TRUSTEE. The Issuer will deliver
to the Trustee on or before April 30 in each year (beginning with April 30,
1998) an Officers' Certificate (which need not comply with Section 11.5)
stating that in the course of the performance by the signers of their duties
as officers of the Issuer they would normally have knowledge of any default
by the Issuer in the performance of any covenants contained in this
Indenture, stating whether or not they have knowledge of any such default
and, if so, specifying each such default of which the signers have knowledge
and the nature thereof.
SECTION 3.6 LIMITATION ON SECURED DEBT. So long as any of the
Securities remain Outstanding, the Issuer will not create or incur any
Secured Debt without in any such case effectively providing concurrently with
the creation or incurrence of any such Secured Debt that the Securities then
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Outstanding (together with, if the Issuer shall so determine, any other Debt
of or guaranteed by the Issuer ranking equally with the Securities and then
existing or thereafter created) shall be secured equally and ratably with
(or, at the option of the Issuer, prior to) such Secured Debt, unless
immediately after the incurrence of such Secured Debt (and after giving
effect to the application of the proceeds, if any, therefrom), the aggregate
principal amount of all such Secured Debt, together with the aggregate amount
of Capitalized Rent in respect of Sale and Leaseback Transactions (other than
Sale and Leaseback Transactions described in clauses (a) to (e), inclusive,
of Section 3.7), would not exceed 10% of Consolidated Capitalization;
PROVIDED, HOWEVER, that the foregoing restrictions shall not apply to, and
there shall be excluded in computing Secured Debt for the purpose of such
restrictions, Secured Debt secured by:
(a) Liens on property existing at the time of acquisition of such
property by the Issuer, or Liens to secure the payment of all or any part
of the purchase price of property acquired or constructed by the Issuer
(including any improvements to existing property) created at the time of or
within 270 days following the acquisition of such property by the Issuer,
or Liens to secure any Secured Debt incurred by the Issuer prior to, at the
time of or within 270 days following the acquisition of such property,
which Secured Debt is incurred for the purpose of financing all or any part
of the purchase price thereof; PROVIDED, HOWEVER, that in the case of any
such acquisition, the Lien shall not apply to any property theretofore
owned by the Issuer (including property transferred by the Issuer to any
subsidiary of the Issuer in contemplation of or in connection with the
creation of such Lien) or to any property of the Issuer other than the
property so acquired (other than, in the case of construction or
improvement, any theretofore unimproved real property or portion thereof on
which the property so constructed, or the improvement, is located);
(b) Liens on property of a Person (i) existing at the time such
Person is merged into or consolidated with the Issuer or at the time of a
sale, lease or other disposition of the properties of a Person as an
entirety or substantially as an entirety to the Issuer, (ii) resulting from
such merger, consolidation, sale, lease or disposition by virtue of any
Lien on property granted by the Issuer prior to such merger, consolidation,
sale, lease or disposition (and not in contemplation thereof or in
connection therewith) which applies to after-acquired property of the
Issuer or (iii) resulting from such merger, consolidation, sale, lease or
disposition pursuant to a Lien or contractual provision granted or entered
into by such Person prior to such merger, consolidation, sale, lease or
disposition (and not at the request of the Issuer); PROVIDED, HOWEVER, that
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any such Lien referred to in clause (i) shall not apply to any property of
the Issuer other than the property subject thereto at the time such Person
or properties were acquired and any such Lien referred to in clause (ii) or
(iii) shall not apply to any property of the Issuer other than the property
so acquired;
(c) Liens existing on the date of this Indenture;
(d) Liens in favor of a government or governmental entity to secure
partial progress, advance or other payments, or other obligations, pursuant
to any contract or statute or to secure any Debt incurred for the purpose
of financing all or any part of the cost of acquiring, constructing or
improving the property subject to such Liens (including, without
limitation, Liens incurred in connection with pollution control, industrial
revenue, private activity bond or similar financing);
(e) Liens arising by reason of deposits with, or the giving of any
form of security to, any governmental agency or any body created or
approved by law or governmental regulation, which Lien is required by law
or governmental regulation as a condition to the transaction of any
business or the exercise of any privilege, franchise, license or permit;
(f) Liens for taxes, assessments or governmental charges or levies
not yet delinquent or governmental charges or levies already delinquent,
the validity of which charge or levy is being contested in good faith and
for which any reserves required in accordance with generally accepted
accounting principles have been established;
(g) Liens (including judgment liens) arising in connection with legal
proceedings so long as such proceedings are being contested in good faith
and, in the case of judgment liens, execution thereon is stayed and for
which any reserves required in accordance with generally accepted
accounting principles have been established; and
(h) any extension, renewal or replacement (or successive extensions,
renewals or replacements) in whole or in part of any Lien referred to in
the foregoing clauses (a) to (g), inclusive; PROVIDED, HOWEVER, that the
principal amount of Secured Debt secured thereby shall not exceed the
principal amount of Secured Debt secured thereby at the time of such
extension, renewal or replacement, and that such extension, renewal or
replacement shall be limited to all or a part of the property which secured
the Lien so extended, renewed or replaced (plus improvements to such
property).
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SECTION 3.7 LIMITATION ON SALE AND LEASEBACK. So long as any of
the Securities remain outstanding, the Issuer will not enter into any Sale
and Leaseback Transaction unless immediately thereafter (and after giving
effect to the application of the proceeds, if any, therefrom), the aggregate
amount of Capitalized Rent in respect of Sale and Leaseback Transactions,
together with the aggregate principal amount of all Secured Debt (other than
Secured Debt described in clauses (a) to (h), inclusive, of Section 3.6),
would not exceed 10% of Consolidated Capitalization; PROVIDED, HOWEVER, that
the foregoing restrictions shall not apply to, and there shall be excluded in
computing the aggregate amount of Capitalized Rent for the purpose of such
restrictions, the following Sale and Leaseback Transactions:
(a) any Sale and Leaseback Transaction entered into to finance the
payment of all or any part of the purchase price of property acquired or
constructed by the Issuer (including any improvements to existing property)
or entered into prior to, at the time of or within 270 days after the
acquisition or construction of such property, which Sale and Leaseback
Transaction is entered into for the purpose of financing all or part of the
purchase or construction price thereof; PROVIDED, HOWEVER, that in the case
of any such acquisition, such Sale and Leaseback Transaction shall not
involve any property transferred by the Issuer to a subsidiary of the
Issuer in contemplation of or in connection with such Sale and Leaseback
Transaction or involve any property of the Issuer other than the property
so acquired (other than, in the case of construction or improvement, any
theretofore unimproved real property or portion thereof on which the
property so constructed, or the improvement, is located);
(b) any Sale and Leaseback Transaction involving property of a Person
existing at the time such Person is merged into or consolidated with the
Issuer or at the time of a sale, lease or other disposition of the
properties of a Person as an entirety or substantially as an entirety to
the Issuer;
(c) any Sale and Leaseback Transaction in which the lessor is a
government or governmental entity and which Sale and Leaseback Transaction
is entered into to secure partial progress, advance or other payments, or
other obligations, pursuant to any contract or statute or to secure any
Debt incurred for the purpose of financing all or any part of the cost of
constructing or improving the property subject to such Sale and Leaseback
Transaction (including, without limitation, Sale and Leaseback Transactions
incurred in connection with pollution control, industrial revenue, private
activity bond or similar financing);
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(d) any Sale and Leaseback Transaction involving the extension,
renewal or replacement (or successive extensions, renewals or replacements)
in whole or in part of a lease pursuant to a Sale and Leaseback Transaction
referred to in the foregoing clauses (a) to (c), inclusive; PROVIDED,
HOWEVER, that such lease extension, renewal or replacement shall be limited
to all or any part of the same property leased under the lease so extended,
renewed or replaced (plus improvements to such property); and
(e) any Sale and Leaseback Transaction the net proceeds of which are
at least equal to the fair value (as determined by the Board of Directors)
of the property leased pursuant to such Sale and Leaseback Transaction, so
long as within 270 days of the effective date of such Sale and Leaseback
Transaction, the Issuer applies (or irrevocably commits to an escrow
account for the purpose or purposes hereinafter mentioned) an amount equal
to the net proceeds of such Sale and Leaseback Transaction to either (x)
the purchase of other property having a fair value at least equal to the
fair value of the property leased in such Sale and Leaseback Transaction
and having a similar utility and function, or (y) the retirement or
repayment (other than any mandatory retirement or repayment at maturity) of
(i) Securities, (ii) other Funded Debt of the Issuer which ranks prior to
or on a parity with the Securities or (iii) indebtedness of any subsidiary
of the Issuer maturing by its terms more than one year from its date of
issuance (notwithstanding that any portion of such indebtedness is included
in current liabilities) or preferred stock of any subsidiary of the Issuer
(other than any such indebtedness owed to or preferred stock owned by the
Issuer or any subsidiary of the Issuer); PROVIDED, HOWEVER, that in lieu of
applying an amount equivalent to all or any part of such net proceeds to
such retirement or repayment (or committing such an amount to an escrow
account for such purpose), the Issuer may deliver to the Trustee
Outstanding Securities and thereby reduce the amount to be applied pursuant
to (y) of this clause (e) by an amount equivalent to the aggregate
principal amount of the Securities so delivered.
ARTICLE FOUR
SECURITYHOLDERS LISTS AND REPORTS BY THE
ISSUER AND THE TRUSTEE
SECTION 4.1 ISSUER TO FURNISH TRUSTEE NAMES AND ADDRESSES OF
SECURITYHOLDERS. The Issuer and any other obligor on the Securities covenant
and agree that they will furnish or cause to be furnished to the Trustee a
list in such form as the
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Trustee may reasonably require of the names and addresses of the Holders of
the Registered Securities of each series:
(a) semi-annually and not more than 15 days after each Record Date
for the payment of interest on such Registered Securities, as of such
Record Date and on dates to be determined pursuant to Section 2.3 for
non-interest bearing Registered Securities, in each year, and
(b) at such other times as the Trustee may request in writing, within
30 days after receipt by the Issuer of any such request, as of a date not
more than 15 days prior to the time such information is furnished,
PROVIDED that if and so long as the Trustee shall be the Security Registrar
for such series and all of the Securities of such series are Registered
Securities, such list shall not be required to be furnished.
SECTION 4.2 PRESERVATION AND DISCLOSURE OF SECURITYHOLDERS LISTS.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the Holders of
each series of Registered Securities (i) contained in the most recent list
furnished to it as provided in Section 4.1, (ii) received by it in the
capacity of Security Registrar for such series, if so acting, and (iii) filed
with it within the two preceding years pursuant to Section 4.4(c)(ii). The
Trustee may destroy any list furnished to it as provided in Section 4.1 upon
receipt of a new list so furnished.
(b) In case three or more Holders of Securities (hereinafter
referred to as "applicants") apply in writing to the Trustee and furnish to
the Trustee reasonable proof that each such applicant has owned a Security
for a period of at least six months preceding the date of such application,
and such application states that the applicants desire to communicate with
other Holders of Securities of a particular series (in which case the
applicants must all hold Securities of such series) or with Holders of all
Securities with respect to their rights under this Indenture or under such
Securities and such application is accompanied by a copy of the form of proxy
or other communication which such applicants propose to transmit, then the
Trustee shall, within five Business Days after the receipt of such
application, at its election, either
(i) afford to such applicants access to the information preserved at
the time by the Trustee in accordance with the provisions of subsection (a)
of this Section, or
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(ii) inform such applicants as to the approximate number of Holders
of Registered Securities of such series or of all Registered Securities, as
the case may be, whose names and addresses appear in the information
preserved at the time by the Trustee, in accordance with the provisions of
such subsection (a) and as to the approximate cost of mailing to such
Holders the form of proxy or other communication, if any, specified in such
application.
If the Trustee shall elect not to afford to such applicants access
to such information, the Trustee shall, upon the written request of such
applicants, mail to each Holder of such series or all Holders of Registered
Securities, whose name and address appears in the information preserved at
the time by the Trustee in accordance with the provisions of such subsection
(a) a copy of the form of proxy or other communication which is specified in
such request, with reasonable promptness after a tender to the Trustee of the
material to be mailed and of payment, or provision for the payment, of the
reasonable expenses of mailing, unless within five days after such tender the
Trustee shall mail to such applicants and file with the Commission, together
with a copy of the material to be mailed, a written statement to the effect
that, in the opinion of the Trustee, such mailing would be contrary to the
best interests of the Holders of Registered Securities of such series or of
all Registered Securities, as the case may be, or would be in violation of
applicable law. Such written statement shall specify the basis of such
opinion. If the Commission, after opportunity for a hearing upon the
objections specified in the written statement so filed, shall enter an order
refusing to sustain any of such objections or if, after the entry of an order
sustaining one or more of such objections, the Commission shall find, after
notice and opportunity for hearing, that all the objections so sustained have
been met, and shall enter an order so declaring, the Trustee shall mail
copies of such material to all such Holders with reasonable promptness after
the entry of such order and the renewal of such tender; otherwise the Trustee
shall be relieved of any obligation or duty to such applicants respecting
their application.
(c) Each and every Holder of Securities and Coupons, by receiving
and holding the same, agrees with the Issuer and the Trustee that neither the
Issuer nor the Trustee nor any agent of the Issuer or the Trustee shall be
held accountable by reason of the disclosure of any such information as to
the names and addresses of the Holders of Securities in accordance with the
provisions of subsection (b) of this Section, regardless of the source from
which such information was derived, and that the Trustee shall not be held
accountable by reason of mailing any material pursuant to a request made
under such subsection (b).
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(d) The Issuer shall upon written request to the Trustee (or, if
applicable, the Security Registrar) be entitled to receive a list of the
Holders of any and all series of Registered Securities.
SECTION 4.3 REPORTS BY THE ISSUER. The Issuer covenants:
(a) to file with the Trustee, within 15 days after the Issuer is
required to file the same with the Commission, copies of the annual reports
and of the information, documents and other reports (or copies of such
portions of any of the foregoing as the Commission may from time to time by
rules and regulations prescribe) which the Issuer may be required to file
with the Commission pursuant to Section 13 or Section 15(d) of the Exchange
Act; or if the Issuer is not required to file information, documents or
reports pursuant to either of such Sections, then to file with the Trustee
and the Commission, in accordance with rules and regulations prescribed
from time to time by the Commission, such of the supplementary and periodic
information, documents, and reports which may be required pursuant to
Section 13 of the Exchange Act in respect of a debt security listed and
registered on a national securities exchange as may be prescribed from time
to time in such rules and regulations;
(b) to file with the Trustee and the Commission, in accordance with
rules and regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect to compliance by
the Issuer with the conditions and covenants provided for in this Indenture
as may be required from time to time by such rules and regulations; and
(c) to transmit by mail to the Holders of Securities within 30 days
after the filing thereof with the Trustee, in the manner and to the extent
provided in Section 4.4(c), such summaries of any information, documents
and reports required to be filed by the Issuer pursuant to subsections (a)
and (b) of this Section as may be required to be transmitted to such
Holders by rules and regulations prescribed from time to time by the
Commission.
SECTION 4.4 REPORTS BY THE TRUSTEE. (a) Within 60 days after May 15
of each year, commencing with the year 1998, the Trustee shall transmit by mail
to the Holders of the Securities of each series, as provided in subsection (c)
of this Section, a brief report dated as of such May 15 with respect to:
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(i) its eligibility under Section 6.9 and its qualification under
Section 6.8, or in lieu thereof, if to the best of its knowledge it has
continued to be eligible and qualified under such Sections, a written
statement to such effect;
(ii) the character and amount of any advances (and if the Trustee
elects so to state, the circumstances surrounding the making thereof) made
by the Trustee (as such) which remain unpaid on the date of such report and
for the reimbursement of which it claims or may claim a lien or charge,
prior to that of the Securities of such series, on any property or funds
held or collected by it as Trustee, except that the Trustee shall not be
required (but may elect) to report such advances if such advances so
remaining unpaid aggregate not more than 1/2 of 1% of the principal amount
of the Securities of such series Outstanding on the date of such report;
(iii) the amount, interest rate and maturity date of all other
indebtedness owing by the Issuer (or by any other obligor on the
Securities) to the Trustee in its individual capacity on the date of such
report, with a brief description of any property held as collateral
security therefor, except any indebtedness based upon a creditor
relationship arising in any manner described in Section 6.13(b)(2),(3),(4)
or (6);
(iv) the property and funds, if any, physically in the possession of
the Trustee (as such) on the date of such report;
(v) any additional issue of Securities which the Trustee has not
previously reported; and
(vi) any action taken by the Trustee in the performance of its duties
under this Indenture which it has not previously reported and which in its
opinion materially affects the Securities of such series, except action in
respect of a default, notice of which has been or is to be withheld by it
in accordance with the provisions of Section 5.11.
(b) The Trustee shall transmit to the Holders of each series, as
provided in subsection (c) of this Section, a brief report with respect to
the character and amount of any advances (and if the Trustee elects so to
state, the circumstances surrounding the making thereof) made by the Trustee,
as such, since the date of the last report transmitted pursuant to the
provisions of subsection (a) of this Section (or if no such report has yet
been so transmitted, since the date of this
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Indenture) for the reimbursement of which it claims or may claim a lien or
charge, prior to that of the Securities of such series, on property or funds
held or collected by it as Trustee and which it has not previously reported
pursuant to this subsection (b), except that the Trustee shall not be
required (but may elect) to report such advances if such advances remaining
unpaid at any time aggregate 10% or less of the principal amount of the
Securities of such series outstanding at such time, such report to be
transmitted within 90 days after such time.
(c) Reports pursuant to this Section shall be transmitted by mail:
(i) to all Holders of Registered Securities, as the names and
addresses of such Holders appear upon the registry books of the Issuer;
(ii) to such other Holders of Securities as have, within two years
preceding such transmission, filed their names and addresses with the
Trustee for that purpose; and
(iii) except in the case of reports pursuant to subsection (b), to
each Holder of a Security whose name and address are preserved at the time
by the Trustee as provided in Section 4.2(a).
(d) A copy of each such report shall, at the time of such
transmission to the Holders, be furnished to the Issuer and be filed by the
Trustee with each stock exchange, if any, upon which the Securities of any
series are listed and also with the Commission. The Issuer agrees to notify the
Trustee when and as the Securities of such series become admitted to trading on
any national securities exchange.
SECTION 4.5 PUBLICATION OF CERTAIN NOTICES. In the event of the
publication of any notice pursuant to Section 5.11, 6.8, 6.10(a), 6.11, 8.2,
10.4, 11.4, 12.2 or 12.5, the party making such publication shall also, to the
extent that notice is required to be given to Holders of Securities of any
series by applicable law or stock exchange regulation, as evidenced by an
Officers' Certificate delivered to such party, make a similar publication in the
place or places so required thereby.
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ARTICLE FIVE
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.1 EVENT OF DEFAULT DEFINED; ACCELERATION OF MATURITY;
WAIVER OF DEFAULT. "Event of Default" with respect to Securities of any
series, wherever used herein, means each of the following events which shall
have occurred and be continuing (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(a) default in the payment of any installment of interest upon any of
the Securities of such series as and when the same shall become due and
payable, and continuance of such default for a period of 30 days; or
(b) default in the payment of all or any part of the principal of any
of the Securities of such series as and when the same shall become due and
payable, whether at maturity, upon any redemption, by declaration or
otherwise; or
(c) default in the deposit of any sinking fund or analogous payment
for the benefit of the Securities of such series as and when the same shall
become due and payable;
(d) failure on the part of the Issuer duly to observe or perform any
other of the covenants or agreements on the part of the Issuer in the
Securities of such series or in this Indenture contained (other than a
covenant or agreement expressly included herein solely for the benefit of
Securities of other series) for a period of 90 days after the date on which
written notice specifying such failure, stating that such notice is a
"Notice of Default" hereunder and demanding that the Issuer remedy the
same, shall have been given (i) (A) in person to the Chairman, the
President, the Executive Vice President - Finance or the Treasurer of the
Issuer promptly followed by notice by registered or certified mail, return
receipt requested, by the Trustee, or (B) by registered or certified mail,
return receipt requested, to the Issuer by the Trustee, or (ii) by
registered or certified mail, return receipt requested, to the Issuer and
the Trustee by the Holders of not less than 25% in aggregate principal
amount of the Outstanding Securities of all series affected thereby; or
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(e) (i) a default occurs under any instrument (including this
Indenture) under which there is at the time outstanding, or by which there
may be secured or evidenced, any indebtedness of the Issuer for money
borrowed by the Issuer (other than non-recourse indebtedness) which results
in acceleration (whether by declaration or automatically) of, or the
nonpayment at maturity (after giving effect to any applicable grace period)
of, such indebtedness in an aggregate amount exceeding $30,000,000 or, if
greater, 2% of Consolidated Capitalization, in which case the Issuer shall
immediately give notice to the Trustee of such acceleration or non-payment
and (ii) there shall have been a failure to cure such default or to
discharge all such defaulted indebtedness within ten days after notice
thereof to the Issuer by the Trustee or to the Issuer and the Trustee by
the Holders of at least 25% in principal amount of the Securities then
Outstanding (excluding, if such defaulted indebtedness includes any series
of Securities, such series of Securities) and such acceleration shall not
be rescinded or annulled; PROVIDED, HOWEVER, that it shall not constitute
an Event of Default hereunder as long as the Issuer is contesting any such
default or acceleration in good faith and by appropriate proceedings; or
(f) a court having jurisdiction in the premises shall enter a decree
or order for relief in respect of the Issuer in an involuntary case under
any applicable bankruptcy, insolvency or other similar law now or hereafter
in effect, or appointing a receiver, liquidator, assignee, custodian,
trustee or sequestrator (or similar official) of the Issuer or for any
substantial part of the property of the Issuer, or ordering the winding up
or liquidation of the affairs of the Issuer, and such decree or order shall
remain unstayed and in effect for a period of 60 consecutive days; or
(g) the Issuer shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
consent to the entry of an order for relief in an involuntary case under
any such law, or consent to the appointment or taking possession by a
receiver, liquidator, assignee, custodian, trustee or sequestrator (or
similar official) of the Issuer or for any substantial part of the property
of the Issuer, or make any general assignment for the benefit of creditors;
or
(h) any other Event of Default provided in or pursuant to the
supplemental indenture or Board Resolution establishing the terms of such
series of
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Securities as provided in Section 2.3 or in the form of Security
for such series.
If an Event of Default described in clause (a), (b) or (c) shall have
occurred and be continuing with respect to the Securities of any series,
then, and in each and every such case, unless the principal of all of the
Securities of such series shall have already become due and payable, either
the Trustee or the Holders of not less than 25% in aggregate principal amount
of the Securities of such series then Outstanding, by notice in writing to
the Issuer (and to the Trustee if given by such Holders), may declare the
entire principal of all the Securities of such series then Outstanding and
the interest accrued thereon to be due and payable immediately, and upon any
such declaration the same shall become immediately due and payable. If an
Event of Default described in clause (d) or (h) (if the Event of Default
under either clause is with respect to less than all series of the Securities
then Outstanding) shall have occurred and be continuing with respect to the
Securities of one or more series, then and in each and every such case,
unless the principal of all of the Securities of such series shall have
already become due and payable, either the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Securities of all series
affected thereby then Outstanding (voting as one class), by notice in writing
to the Issuer (and to the Trustee if given by such Holders), may declare the
entire principal of all the Securities of all such affected series then
Outstanding and the interest accrued thereon to be due and payable
immediately, and upon any such declaration the same shall become immediately
due and payable. If an Event of Default described in clause (d) or (h) (if
the Event of Default under either clause is with respect to all series of
Securities then Outstanding) or described in clause (e) shall have occurred
and be continuing, then, and in each and every such case, unless the
principal of all the Securities shall have already become due and payable,
either the Trustee or the Holders of not less than 25% in aggregate principal
amount of all the Securities then Outstanding (voting as one class), by
notice in writing to the Issuer (and to the Trustee if given by such
Holders), may declare the entire principal of all the Securities then
Outstanding and interest accrued thereon, if any, to be due and payable
immediately, and upon any such declaration the same shall become immediately
due and payable. If an Event of Default described in clause (f) or (g) shall
have occurred and be continuing, the principal and interest on all the
Securities then Outstanding shall thereby become and be immediately due and
payable without any declaration or other act on the part of the Trustee or
any Securityholders.
The foregoing paragraph, however, is subject to the condition that
if, at any time after the principal of the Securities of one or more series
shall have been so declared due and payable, and before any judgment or
decree for the payment of
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the moneys due shall have been obtained or entered as hereinafter provided,
the Issuer shall pay or shall deposit with the Trustee a sum sufficient to
pay all matured installments of interest upon all the Securities of such
series and the principal of all Securities of such series which shall have
become due otherwise than by acceleration (with interest upon such principal
and, to the extent that payment of such interest is enforceable under
applicable law, on overdue installments of interest at the same rate as the
rate of interest (or Yield to Maturity, in the case of Original Issue
Discount Securities) specified in the Securities of such series, to the date
of such payment or deposit) and such amount as shall be sufficient to cover
reasonable compensation to the Trustee, its agents, attorneys and counsel,
and all other expenses and liabilities incurred, and all advances made, by
the Trustee except as a result of negligence or bad faith, and if any and all
Events of Default under this Indenture with respect to such series, other
than the non-payment of the principal of Securities of such series which
shall have become due by acceleration, shall have been cured, waived or
otherwise remedied as provided herein--then, and in every such case, the
Holders of a majority in aggregate principal amount of all the Securities of
such affected series then Outstanding (voting as one class, except in the
case of Events of Default described in clauses (a), (b) and (c) of such
paragraph, in which case each series of Securities as to which such an Event
of Default shall have occurred shall vote as a separate class), by written
notice to the Issuer and to the Trustee, may waive all defaults with respect
to such series and rescind and annul such declaration and its consequences,
but no such waiver or rescission and annulment shall extend to or shall
affect any subsequent default or shall impair any right consequent thereon.
For all purposes under this Indenture, if a portion of the
principal of any Original Issue Discount Securities shall have been
accelerated and declared due and payable pursuant to the provisions hereof,
then, from and after such declaration, unless such declaration has been
rescinded and annulled, the principal amount of such Original Issue Discount
Securities shall be deemed, for all purposes hereunder, to be such portion of
the principal thereof as shall be due and payable as a result of such
acceleration, and payment of such portion of the principal thereof as shall
be due and payable as a result of such acceleration, together with interest,
if any, thereon and all other amounts owing thereunder, shall constitute
payment in full of such Original Issue Discount Securities.
SECTION 5.2 COLLECTION OF INDEBTEDNESS BY TRUSTEE; TRUSTEE MAY
PROVE DEBT. The Issuer covenants that (a) in case default shall be made in
the payment of any installment of interest on any of the Securities of any
series when such interest shall have become due and payable, and such default
shall have continued for a period of 30 days, or (b) in case
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default shall be made in the payment of all or any part of the principal of
any of the Securities of any series when the same shall have become due and
payable, whether at maturity, upon redemption, by declaration or otherwise --
then, upon demand of the Trustee, the Issuer will pay to the Trustee for the
benefit of the Holders of the Securities of such series the whole amount that
then shall have become due and payable on all Securities of such series,
including all Coupons, for principal or interest, as the case may be (with
interest to the date of such payment upon the overdue principal and, to the
extent that payment of such interest is enforceable under applicable law, on
overdue installments of interest at the same rate as the rate of interest (or
Yield to Maturity, in the case of Original Issue Discount Securities)
specified in the Securities of such series); and in addition thereto, such
further amount as shall be sufficient to cover the costs and expenses of
collection, including reasonable compensation to the Trustee, its agents,
attorneys and counsel, and any expenses and liabilities incurred, and all
advances made, by the Trustee except as a result of its negligence or bad
faith.
Until such demand is made by the Trustee, the Issuer may pay the
principal of and interest on the Securities of such series to the Holders,
whether or not the Securities of such series be overdue.
In case the Issuer shall fail forthwith to pay such amounts upon
such demand, the Trustee, in its own name and as trustee of an express trust,
shall be entitled and empowered to institute any action or proceedings at law
or in equity for the collection of the sums so due and unpaid, and may
prosecute any such action or proceedings to judgment or final decree, and may
enforce any such judgment or final decree against the Issuer or other obligor
upon the Securities of such series and collect in the manner provided by law
out of the property of the Issuer or other obligor upon the Securities of
such series, wherever situated the moneys adjudged or decreed to be payable.
In case there shall be pending proceedings relative to the Issuer
or any other obligor upon the Securities of any series under Title 11 of the
United States Code or any other applicable Federal or state bankruptcy,
insolvency or other similar law, or in case a receiver, assignee or trustee
in bankruptcy or reorganization, liquidator, sequestrator or similar official
shall have been appointed for or taken possession of the Issuer or its
property or such other obligor, or in case of any other comparable judicial
proceedings relative to the Issuer or such other obligor, or to the creditors
or property of the Issuer or such other obligor, the Trustee, irrespective of
whether the principal of the Securities of any series shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective
of whether the Trustee shall have made any demand
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pursuant to the provisions of this Section, shall be entitled and empowered,
by intervention in such proceedings or otherwise:
(a) to file and prove a claim or claims for the whole amount of the
principal and interest (or, if the Securities of any series are Original
Issue Discount Securities, such portion of the principal amount as may be
specified in the terms of such series) owing and unpaid in respect of the
Securities of each series, and to file such other papers or documents as
may be necessary or advisable in order to have the claims of the Trustee
(including any claim for reasonable compensation to the Trustee and its
agents, attorneys and counsel, and for reimbursement of all expenses and
liabilities incurred, and all advances made, by the Trustee, except as a
result of negligence or bad faith) and of the Securityholders allowed in
any judicial proceedings relative to the Issuer or such other obligor, or
to the creditors or property of the Issuer or such other obligor,
(b) unless prohibited by applicable law and regulations, to vote on
behalf of the Holders of the Securities of each series in any election of a
trustee or a standby trustee in arrangement, reorganization, liquidation or
other bankruptcy or insolvency proceedings or person performing similar
functions in comparable proceedings, and
(c) to collect and receive any moneys or other property payable
or deliverable on any such claims, and to distribute all amounts received
with respect to the claims of the Securityholders and of the Trustee on
their behalf; and any trustee, receiver, liquidator, custodian or other
similar official is hereby authorized by each of the Securityholders to
make payments to the Trustee, and, in the event that the Trustee shall
consent to the making of payments directly to the Securityholders, to pay
to the Trustee such amounts as shall be sufficient to cover reasonable
compensation to the Trustee, and its agents, attorneys and counsel, and all
other expenses and liabilities incurred, and all advances made, by the
Trustee except as a result of negligence or bad faith.
Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or vote for or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities of any series or the rights of any Holder thereof,
or to authorize the Trustee to vote in respect of the claim of any
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Holder in any such proceeding except, as aforesaid, to vote for the election
of a trustee in bankruptcy or similar person.
All rights of action and of asserting claims under this Indenture,
or under any of the Securities of any series or Coupons appertaining thereto,
may be enforced by the Trustee without the possession of any of the
Securities of such series or coupons appertaining thereto or the production
thereof on any trial or other proceedings relative thereto, and any such
action or proceedings instituted by the Trustee shall be brought in its own
name as trustee of an express trust, and any recovery of judgment, subject to
the payment of the expenses, disbursements and compensation of the Trustee
and its agents, attorneys and counsel, shall be for the ratable benefit of
the Holders of the Securities or Coupons appertaining to such Securities in
respect of which such action was taken.
In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all the
Holders of the Securities and Coupons appertaining thereto in respect to
which action was taken, and it shall not be necessary to make any Holders of
such Securities or Coupons parties to any such proceedings.
SECTION 5.3 APPLICATION OF PROCEEDS. Any moneys collected by the
Trustee pursuant to this Article in respect of the Securities of any series
shall be applied in the following order at the date or dates fixed by the
Trustee and, in case of the distribution of such moneys on account of
principal or interest, upon presentation of the several Securities and
Coupons appertaining thereto in respect of which moneys have been collected
and stamping (or otherwise noting) thereon the payment, or issuing Securities
of the same series in reduced principal amounts in exchange for the presented
Securities if only partially paid, or upon surrender thereof if fully paid:
FIRST: To the payment of costs and expenses of collection applicable
to such series, including reasonable compensation to the Trustee and its
agents, attorneys and counsel and of all expenses and liabilities incurred,
and all advances made, by the Trustee except as a result of negligence or
bad faith;
SECOND: In case the principal of the Securities of such series in
respect of which moneys have been collected shall not have become and be
then due and payable, to the payment of interest on the Securities of such
series in default in the order of the maturity of the installments of such
interest, with interest (to the extent that such interest has been
collected by the Trustee) upon the overdue installments of interest at
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the same rate as the rate of interest (or Yield to Maturity, in the case of
Original Issue Discount Securities) specified in such Securities, such
payments to be made ratably to the Persons entitled thereto, without
discrimination or preference;
THIRD: In case the principal of the Securities of such series in
respect of which moneys have been collected shall have become and be then
due and payable, to the payment of the whole amount then owing and unpaid
upon all the Securities of such series for principal and interest, with
interest upon the overdue principal, and (to the extent that such interest
has been collected by the Trustee) upon overdue installments of interest at
the same rate as the rate of interest (or Yield to Maturity, in the case of
Original Issue Discount Securities) specified in the Securities of such
series; and in case such moneys shall be insufficient to pay in full the
whole amount so due and unpaid upon the Securities of such series, then to
the payment of such principal and interest, without preference or priority
of principal over interest, or of interest over principal, or of any
installment of interest over any other installment of interest, or of any
Security of such series over any other Security of such series, ratably to
the aggregate of such principal and accrued and unpaid interest; and
FOURTH: To the payment of the remainder, if any, to the Issuer or any
other person lawfully entitled thereto.
SECTION 5.4 SUITS FOR ENFORCEMENT. In case an Event of Default
has occurred, has not been waived and is continuing, the Trustee may in its
discretion proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any of such rights, either at law or in
equity or in bankruptcy or otherwise, whether for the specific enforcement of
any covenant or agreement contained in this Indenture or in aid of the
exercise of any power granted in this Indenture or to enforce any other legal
or equitable right vested in the Trustee by this Indenture or by law.
SECTION 5.5 RESTORATION OF RIGHTS ON ABANDONMENT OF PROCEEDINGS.
In case the Trustee shall have proceeded to enforce any right under this
Indenture and such proceedings shall have been discontinued or abandoned for
any reason, or shall have been determined adversely to the Trustee, then, and
in every such case, the Issuer and the Trustee shall be restored respectively
to their former positions and rights hereunder, and all rights, remedies and
powers of the Issuer, the Trustee and the
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Securityholders shall continue as though no such proceedings had been taken.
SECTION 5.6 LIMITATIONS ON SUITS BY SECURITYHOLDERS. No Holder of
any Security of any series or of any Coupon appertaining thereto shall have
any right by virtue or by availing of any provision of this Indenture to
institute any action or proceeding at law or in equity or in bankruptcy or
otherwise upon or under or with respect to this Indenture, or for the
appointment of a trustee, receiver, liquidator, custodian or other similar
official or for any other remedy hereunder, unless such Holder previously
shall have given to the Trustee written notice of default and of the
continuance thereof, as hereinbefore provided, and unless also the Holders of
not less than 25% in aggregate principal amount of the Securities of each
affected series then Outstanding (determined as provided in Section 5.1 and
voting as one class) shall have made written request upon the Trustee to
institute such action or proceedings in its own name as trustee hereunder and
shall have offered to the Trustee such reasonable indemnity as it may require
against the costs, expenses and liabilities to be incurred therein or thereby
and the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity shall have failed to institute any such action or
proceeding and no direction inconsistent with such written request shall have
been given to the Trustee pursuant to Section 5.9; it being understood and
intended, and being expressly covenanted by the taker and Holder of every
Security or Coupon with every other taker and Holder and the Trustee, that no
one or more Holders of Securities of any series or Coupons appertaining
thereto shall have any right in any manner whatever by virtue or by availing
of any provision of this Indenture to affect, disturb or prejudice the rights
of any other Holder of Securities or Coupons appertaining thereto, or to
obtain or seek to obtain priority over or preference to any other such Holder
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal, ratable and common benefit of all Holders of
Securities of the affected series and Coupons. For the protection and
enforcement of the provisions of this Section, each and every Securityholder
and the Trustee shall be entitled to such relief as can be given either at
law or in equity.
SECTION 5.7 UNCONDITIONAL RIGHT OF SECURITYHOLDERS TO INSTITUTE
CERTAIN SUITS. Notwithstanding any other provision in this Indenture and any
provision of any Security, the right of any Holder of any Security or Coupon
to receive payment of the principal of and interest on such Security or
Coupon on or after the respective due dates expressed in such Security or
Coupon, or to institute suit for the enforcement of any such payment on or
after such respective dates, shall not be impaired or affected without the
consent of such Holder.
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SECTION 5.8 POWERS AND REMEDIES CUMULATIVE; DELAY OR OMISSION NOT
WAIVER OF DEFAULT. Except as provided in the last sentence of Section 2.9
and subject to Section 5.6, no right or remedy herein conferred upon or
reserved to the Trustee or to the Holders of Securities or Coupons is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition
to every other right and remedy given hereunder or now or hereafter existing
at law or in equity or otherwise. The assertion or employment of any right
or remedy hereunder, or otherwise, shall not prevent the concurrent assertion
or employment of any other appropriate right or remedy.
No delay or omission of the Trustee or of any Holder of Securities
or Coupons to exercise any right or power accruing upon any Event of Default
occurring and continuing as aforesaid shall impair any such right or power or
shall be construed to be a waiver of any such Event of Default or an
acquiescence therein; and, subject to Section 5.6, every power and remedy
given by this Indenture or by law to the Trustee or to the Holders of
Securities or Coupons may be exercised from time to time, and as often as
shall be deemed expedient, by the Trustee or by the Holders of Securities or
Coupons.
SECTION 5.9 CONTROL BY HOLDERS OF SECURITIES. The Holders of a
majority in aggregate principal amount of the Securities of each series
affected at the time Outstanding (determined as provided in Section 5.1 and
voting as one class) shall have the right to direct the time, method, and
place of conducting any proceeding for any remedy available to the Trustee,
or exercising any trust or power conferred upon the Trustee with respect to
the Securities of such affected series by this Indenture; PROVIDED that such
direction shall not be otherwise than in accordance with law and the
provisions of this Indenture and PROVIDED FURTHER that (subject to the
provisions of Section 6.1) the Trustee shall have the right to decline to
follow any such direction if the Trustee, being advised by counsel, shall
determine that the action or proceeding so directed may not lawfully be taken
or if the Trustee in good faith by its board of directors, its executive
committee or a trust committee of directors or Responsible Officers of the
Trustee shall determine that the action or proceedings so directed would
involve the Trustee in personal liability or that the actions or forbearances
specified in or pursuant to such direction would be unduly prejudicial to the
interests of Holders of the Securities of all affected series not joining in
the giving of said direction, it being understood that (subject to Section
6.1) the Trustee shall have no duty to ascertain whether or not such actions
or forbearances are unduly prejudicial to such Holders.
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Nothing in this Indenture shall impair the right of the Trustee in
its discretion to take any action deemed proper by the Trustee and which is
not inconsistent with such direction or directions by Securityholders.
SECTION 5.10 WAIVER OF PAST DEFAULTS. Prior to the declaration of
acceleration of the maturity of any Securities as provided in Section 5.1,
the Holders of a majority in aggregate principal amount of the Securities of
all series at the time Outstanding with respect to which a default or an
Event of Default shall have occurred and be continuing (determined as
provided in Section 5.1 and voting as one class) may on behalf of the Holders
of all such affected Securities waive any past default or Event of Default
with respect to such series described in Section 5.1 and its consequences,
except a default or an Event of Default in respect of a covenant or provision
hereof or of any Security which cannot be modified or amended without the
consent of the Holder of each Security affected. In the case of any such
waiver, the Issuer, the Trustee and the Holders of all such affected
Securities shall be restored to their former positions and rights hereunder,
respectively; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
Upon any such waiver, such default shall cease to exist and be
deemed to have been cured and not to have occurred, and any Event of Default
arising therefrom shall be deemed to have been cured, and not to have
occurred for every purpose of this Indenture; but no such waiver shall extend
to any subsequent or other default or Event of Default or impair any right
consequent thereon.
SECTION 5.11 TRUSTEE TO GIVE NOTICE OF DEFAULT, BUT MAY WITHHOLD
IN CERTAIN CIRCUMSTANCES. The Trustee shall, within 90 days after the
occurrence of a default with respect to the Securities of any series, give
notice of all defaults with respect to such series known to the Trustee (i)
if any Unregistered Securities of such series are then Outstanding, to the
Holders thereof by publication at least once in each Authorized Newspaper
with respect to such series and (ii) to all Holders of Securities of such
series in the manner and to the extent provided in Section 4.4(c), unless in
each case such defaults shall have been cured before the mailing or
publication of such notice (the term "default" for the purpose of this
Article being hereby defined to mean any event or condition which is, or with
notice or lapse of time or both would become, an Event of Default); provided
that, except in the case of default in the payment of the principal of or the
interest on any of the Securities of such series, or in the payment of any
sinking fund installment or analogous payment on such series, the Trustee
shall be protected in withholding such notice if and so long as the board of
directors, the executive committee or a trust
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committee of directors or trustees and/or Responsible Officers of the Trustee
in good faith determines that the withholding of such notice is in the
interests of the Securityholders of such series.
SECTION 5.12 RIGHT OF COURT TO REQUIRE FILING OF UNDERTAKING TO
PAY COSTS. All parties to this Indenture agree, and each Holder of any
Security or Coupon by his acceptance thereof shall be deemed to have agreed,
that any court may in its discretion require, in any suit for the enforcement
of any right or remedy under this Indenture or in any suit against the
Trustee for any action taken, suffered or omitted by it as Trustee, the
filing by any party litigant in such suit of an undertaking to pay the costs
of such suit, and that such court may in its discretion assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in
such suit, having due regard to the merits and good faith of the claims or
defenses made by such party litigant; but the provisions of this Section
shall not apply to any suit instituted by the Trustee, to any suit instituted
by any Securityholder or group of Securityholders of any series holding in
the aggregate more than 10% in aggregate principal amount of the Securities
of such series, or, in the case of any suit relating to or arising under
clause (d) or (g) of Section 5.1 (if the suit relates to the Securities of
more than one but less than all series), 10% in aggregate principal amount of
the Securities then outstanding and affected thereby, or, in the case of any
suit relating to or arising under clause (d) or (g) (if the suit relates to
all the Securities then Outstanding), or clause (e) or (f) of Section 5.1,
10% in aggregate principal amount of all Securities then Outstanding, or to
any suit instituted by any Securityholder for the enforcement of the payment
of the principal of or the interest (including interest evidenced by any
Coupon) on any Security on or after the due date expressed in such Security
or Coupon or any date fixed for redemption.
ARTICLE SIX
CONCERNING THE TRUSTEE
SECTION 6.1 DUTIES AND RESPONSIBILITIES OF THE TRUSTEE; DURING
DEFAULT; PRIOR TO DEFAULT. The Trustee, prior to the occurrence of an Event of
Default with respect to the Securities of a particular series and after the
curing or waiving of all Events of Default which may have occurred with respect
to such series, undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture. In case an Event of Default with
respect to the Securities of a particular series has occurred (which has not
been cured or waived), the Trustee shall exercise with respect to such series
such of the rights and powers vested in it by this Indenture, and use the same
degree of care and skill in their exercise, as a
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prudent man would exercise or use under the circumstances in the conduct of
his own affairs.
No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent
failure to act or its own wilful misconduct, except that
(a) prior to the occurrence of an Event of
Default with respect to the Securities of any series and after the curing
or waiving of all such Events of Default which may have occurred with
respect to such series:
(i) the duties and obligations of the Trustee with respect to
the Securities of such series shall be determined solely by the
express provisions of this Indenture, and the Trustee shall not be
liable except for the performance of such duties and obligations as
are specifically set forth in this Indenture, and no implied covenants
or obligations shall be read into this Indenture against the Trustee;
and
(ii) in the absence of bad faith on the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon any
statements, certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but in the case of
any such statements, certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine whether
or not they conform to the requirements of this Indenture;
(b) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it shall be proved that the Trustee was negligent in ascertaining
the pertinent facts; and
(c) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with an
appropriate direction of the Holders pursuant to Section 5.9 relating to
the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any
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trust or power conferred upon the Trustee, under this Indenture.
None of the provisions contained in this indenture shall require the
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 there shall be reasonable grounds for believing that
the repayment of such funds or adequate indemnity against such liability is not
reasonably assured to it.
SECTION 6.2 CERTAIN RIGHTS OF THE TRUSTEE. Subject to Section 6.1:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officers' Certificate or other
certificate, statement, instrument, opinion, report, notice, request,
consent, order, bond, debenture, note, Coupon, security or other paper or
document believed by it to be genuine and to have been signed or presented
by the proper party or parties;
(b) any request, direction, order or demand of the Issuer mentioned
herein shall be sufficiently evidenced by an Officers' Certificate (unless
other evidence in respect thereof be herein specifically prescribed); and
any resolution of the Board of Directors may be evidenced to the Trustee by
a copy thereof certified by the secretary or an assistant secretary of the
Issuer;
(c) the Trustee may consult with counsel and any written advice or
any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be taken
by it hereunder in good faith and in accordance with such advice or Opinion
of Counsel;
(d) the Trustee shall be under no obligation to exercise any of the
trusts or powers vested in it by this Indenture at the request, order or
direction of any of the Holders pursuant to the provisions of this
Indenture, unless such Holders shall have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities which might be
incurred therein or thereby;
(e) the Trustee shall not be liable for any action taken or omitted
by it in good faith and believed by it to be authorized or within the
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discretion, rights or powers conferred upon it by this Indenture;
(f) prior to the occurrence of an Event of Default with respect to
the Securities of any series and after the curing or waiving of all such
Events of Default, the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval,
appraisal, bond, debenture, note, Coupon, security or other paper or
document unless requested in writing so to do by the Holders of not less
than a majority in aggregate principal amount of the Securities of all
affected series then Outstanding; PROVIDED that, if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities likely
to be incurred by it in the making of such investigation is, in the opinion
of the Trustee, not reasonably assured to the Trustee by the security
afforded to it by the terms of this Indenture, the Trustee may require
reasonable indemnity against such costs, expenses or liabilities as a
condition to proceeding; the reasonable expenses of every such
investigation shall be paid by the Issuer or, if paid by the Trustee, shall
be repaid by the Issuer upon demand; and
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys not regularly in its employ, and the Trustee shall not be
responsible for any misconduct or negligence on the part of any such agent
or attorney appointed with due care by it hereunder.
SECTION 6.3 TRUSTEE NOT RESPONSIBLE FOR RECITALS, DISPOSITION OF
SECURITIES OR APPLICATION OF PROCEEDS THEREOF. The recitals contained herein
and in the Securities, except the Trustee's certificates of authentication,
shall be taken as the statements of the Issuer, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee makes no
representation as to the validity or sufficiency of this Indenture or of the
Securities or Coupons. The Trustee shall not be accountable for the use or
application by the Issuer of any of the Securities or of the proceeds thereof.
SECTION 6.4 TRUSTEE AND AGENTS MAY HOLD SECURITIES OR COUPONS;
COLLECTIONS, ETC. The Trustee or any agent of the Issuer or the Trustee, in
its individual or any other capacity, may become the owner or pledgee of
Securities or Coupons with the same rights it would have if it were not the
Trustee or such
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agent and, subject to Sections 6.8 and 6.13, may otherwise deal with the
Issuer and receive, collect, hold and retain collections from the Issuer with
the same rights it would have if it were not the Trustee or such agent.
SECTION 6.5 MONEYS HELD BY TRUSTEE. Subject to the provisions of
Section 10.4, all moneys received by the Trustee shall, until used or applied
as herein provided, be held in trust for the purposes for which they were
received, but need not be segregated from other funds except to the extent
required by mandatory provisions of law. Neither the Trustee nor any agent
of the Issuer or the Trustee shall be under any liability for interest on any
moneys received by it hereunder.
SECTION 6.6 COMPENSATION AND INDEMNIFICATION OF TRUSTEE AND ITS
PRIOR CLAIM. The Issuer covenants and agrees to pay to the Trustee from time
to time, and the Trustee shall be entitled to, reasonable compensation (which
shall not be limited by any provision of law in regard to the compensation of
a trustee of an express trust), and the Issuer covenants and agrees to pay or
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by or on behalf of it in
accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its counsel and
of all agents and other persons not regularly in its employ) except any such
expense, disbursement or advance as may arise from its negligence or bad
faith. The Issuer also covenants to indemnify the Trustee for, and to hold
it 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 this Indenture or the trusts hereunder and
its duties hereunder, including the costs and expenses of defending itself
against or investigating any claim or liability in the premises. The
obligations of the Issuer under this Section to compensate and indemnify the
Trustee and to pay or reimburse the Trustee for expenses, disbursements and
advances shall constitute additional indebtedness hereunder and shall survive
the satisfaction and discharge of this Indenture. Such additional
indebtedness shall be a senior claim to that of the Securities upon all
property and funds held or collected by the Trustee as such, except funds
held in trust for the benefit of the Holders of particular Securities or
Coupons, and the Securities are hereby subordinated to such senior claim.
SECTION 6.7 RIGHT OF TRUSTEE TO RELY ON OFFICERS' CERTIFICATE,
ETC. Subject to Sections 6.1 and 6.2, whenever in the administration of the
trusts of this Indenture the Trustee shall deem it necessary or desirable
that a matter be proved or established prior to taking or suffering or
omitting any action hereunder, such matter (unless other evidence in respect
thereof be herein specifically prescribed) may, in the absence of
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negligence or bad faith on the part of the Trustee, be deemed to be
conclusively proved and established by an Officers' Certificate delivered to
the Trustee, and such certificate, in the absence of negligence or bad faith
on the part of the Trustee, shall be full warrant to the Trustee for any
action taken, suffered or omitted by it under the provisions of this
Indenture in reliance thereon.
SECTION 6.8 QUALIFICATION OF TRUSTEE; CONFLICTING INTERESTS. The
Trustee shall be disqualified only where such disqualification is required by
Section 310(b) of the Trust Indenture Act. Nothing shall prevent the Trustee
from filing with the Commission the application referred to in the second to
last paragraph of Section 310(b) of the Trust Indenture Act.
SECTION 6.9 PERSONS ELIGIBLE FOR APPOINTMENT AS TRUSTEE. There
shall at all times be a Trustee hereunder for each series of Securities which
shall be a corporation organized and doing business under the laws of the
United States of America or of any State thereof or the District of Columbia
having a combined capital and surplus of at least $50,000,000, and which is
authorized under such laws to exercise corporate trust powers and is subject
to supervision or examination by Federal, State or District of Columbia
authority. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the aforesaid supervising
or examining authority, then, for the purposes of this Section, 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. In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, the Trustee shall resign
immediately in the manner and with the effect specified in Section 6.10.
SECTION 6.10 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR
TRUSTEE. (a) The Trustee, or any trustee or trustees hereafter appointed, may
at any time resign with respect to one or more or all series of Securities by
giving written notice of resignation to the Issuer and (i) if any
Unregistered Securities of a series affected are then Outstanding, by giving
notice of such resignation to the Holders thereof by publication at least
once in each Authorized Newspaper with respect to such series, (ii) if any
Unregistered Securities of a series affected are then Outstanding, by mailing
notice of such resignation to the Holders thereof who have filed their names
and addresses with the Trustee pursuant to Section 4.4(c)(ii) at such
addresses as were so furnished to the Trustee and (iii) by mailing notice of
such resignation to the Holders of the then Outstanding Registered Securities
of each series affected at their addresses as they shall appear on the
Security Register. Upon receiving such notice of resignation, the Issuer
shall promptly appoint a
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successor trustee or trustees with respect to the applicable series by
written instrument, in duplicate, executed by authority of the Board of
Directors, one copy of which instrument shall be delivered to the resigning
Trustee and one copy to the successor trustee or trustees. If no successor
trustee shall have been so appointed with respect to any series and shall
have accepted appointment within 30 days after the mailing of such notice of
resignation, the resigning trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee, or any Holder who
has been a bona fide Holder of a Security or Securities of such series for at
least six months may, subject to the provisions of Section 5.12, on behalf of
such Holder and all others similarly situated, petition any such court for
the appointment of a successor trustee. Such court may thereupon, after such
notice, if any, as it may deem proper and prescribe, appoint a successor
trustee.
(b) In case at any time any of the following shall
occur:
(i) the Trustee shall fail to comply with the provisions of Section
6.8 with respect to any series of Securities after written request therefor
by the Issuer or by any Holder who has been a bona fide Holder of a
Security or Securities of such series for at least six months; or
(ii) the Trustee shall cease to be eligible in accordance with the
provisions of Section 6.9 and shall fail to resign after written request
therefor by the Issuer or by any such Holder; or
(iii) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent, or a receiver or liquidator of the
Trustee or of its property shall be appointed, or any public officer shall
take charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation; or
(iv) the Issuer shall elect to remove the Trustee, provided that no
Event of Default, or event which following notice or the passage of time or
both would constitute an Event of Default, shall then exist with respect to
the Securities or series thereof as to which the Trustee shall be removed
and such removal does not adversely affect the interests of any Holder of
such Securities or series;
then, in any such case, the Issuer may remove the Trustee with respect to the
Securities of any or all series, as appropriate, and appoint a successor trustee
for such series by written
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instrument, in duplicate, executed by order of the Board of Directors, one
copy of which instrument shall be delivered to the Trustee so removed and one
copy to the successor trustee or trustees, or, subject to the provisions of
Section 5.12, any Holder who has been a bona fide Holder of a Security or
Securities of such series for at least six months may, on behalf of such
Holder and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a
successor trustee. Such court may thereupon, after such notice, if any, as
it may deem proper and prescribe, remove the Trustee and appoint a successor
trustee.
(c) Any resignation or removal of the Trustee with respect to any
series of Securities and any appointment of a successor trustee with respect
to such series pursuant to any of the provisions of this Section shall become
effective upon acceptance of appointment by the successor trustee as provided
in Section 6.11.
SECTION 6.11 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR TRUSTEE. Any
successor trustee appointed as provided in Section 6.10 shall execute,
acknowledge and deliver to the Issuer and to its predecessor trustee an
instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor trustee with respect to all
applicable series of Securities shall become effective and such successor
trustee, without any further act, deed or conveyance, shall become vested
with all rights, powers, trusts and duties with respect to such applicable
series of its predecessor hereunder, with like effect as if originally named
as trustee for such series hereunder; but, nevertheless, on the written
request of the Issuer or of the successor trustee, upon payment of its
charges then unpaid, the trustee ceasing to act shall, subject to Section
10.4, pay over to the successor trustee all moneys at the time held by it
hereunder for the benefit of such applicable series and shall execute,
acknowledge and deliver an instrument transferring to such successor trustee
all such rights, powers, trusts and duties. Upon request of any such
successor trustee, the Issuer shall execute and acknowledge any and all
instruments in writing for more fully and certainly vesting in and confirming
to such successor trustee all such rights, powers and trusts. Any trustee
ceasing to act shall, nevertheless, retain a prior claim upon all property or
funds held or collected by such trustee for the benefit of such applicable
series to secure any amounts then due it pursuant to the provisions of
Section 6.6.
If a successor trustee is appointed with respect to the Securities
of one or more (but less than all) series, the Issuer, the predecessor
trustee and each successor trustee so appointed shall execute, acknowledge
and deliver an indenture supplemental hereto which shall contain such
provisions as shall be deemed necessary or desirable to confirm that all the
rights, powers,
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trusts and duties of such predecessor trustee with respect to the Securities
of any series as to which such predecessor trustee is not retiring shall
continue to be vested in such predecessor trustee, and to add to or change
any of the provisions of this Indenture as shall be necessary to provide for
or facilitate the administration of the trusts hereunder by more than one
trustee, it being understood that nothing herein or in such supplemental
indenture shall constitute such trustees as co-trustees of the same trust and
that each such trustee shall be trustee of a separate trust or trusts under
this indenture.
No successor trustee with respect to any series of Securities shall
accept appointment as provided in this Section unless at the time of such
acceptance such successor trustee shall be qualified under the provisions of
Section 6.8 and eligible under the provisions of Section 6.9.
Upon acceptance of appointment by any successor trustee as provided
in this Section, the Issuer shall give notice thereof (a) if any Unregistered
Securities of a series affected are then Outstanding, to the Holders thereof
by publication of such notice at least once in each Authorized Newspaper with
respect to such series, (b) if any Unregistered Securities of a series
affected are then Outstanding, to the Holders thereof who have filed their
names and addresses with the Trustee pursuant to Section 4.4(c)(ii) by
mailing such notice to such Holders at such addresses as were so furnished to
the Trustee (and the Trustee shall make such information available to the
Issuer for such purpose) and (c) to the Holders of Registered Securities of
each series affected, by mailing such notice to such Holders at their
addresses as they shall appear on the Security Register. If the acceptance
of appointment is substantially contemporaneous with the resignation, then
the notice called for by the preceding sentence may be combined with the
notice called for by Section 6.10. If the Issuer fails to give such notice
within 10 days after acceptance of appointment by the successor trustee, the
successor trustee shall cause such notice to be given at the expense of the
Issuer.
SECTION 6.12 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS OF TRUSTEE. Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, PROVIDED that such
corporation shall be qualified under the provisions of Section 6.8 and
eligible under the provisions of Section 6.9, without the execution or filing
of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
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In case at the time of such succession to the Trustee any of the
Securities of any series shall have been authenticated but not delivered, any
such successor trustee may adopt the certificate of authentication of any
predecessor trustee and deliver the Securities so authenticated; and, in case
at that time any of the Securities of any series shall not have been
authenticated, any successor trustee may authenticate such Securities either
in the name of any predecessor hereunder or in the name of such successor
trustee; and in all such cases such certificate of authentication shall have
the full force which it is anywhere in the Securities of such series or in
this Indenture provided that the certificate of authentication of the Trustee
shall have; PROVIDED that the right to adopt the certification of any
predecessor trustee or to authenticate Securities of any series in the name
of any predecessor trustee shall apply only to its successor or successors by
merger, conversion or consolidation.
SECTION 6.13 PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE ISSUER.
(a) Subject to the provisions of this Section, if the Trustee shall be or
shall become a creditor, directly or indirectly, secured or unsecured, of the
Issuer within four months prior to a default, as defined in subsection (c) of
this Section, or subsequent to such a default, then, unless and until such
default shall be cured, the Trustee shall set apart and hold in a special
account for the benefit of the Trustee individually, the Holders of the
Securities and Coupons and the holders of other indenture securities (as
defined in such subsection (c)):
(1) an amount equal to any and all reductions in the amount due and
owing upon any claim as such creditor in respect of principal or interest
affected after the beginning of such four months' period and valid as
against the Issuer and its other creditors, except any such reduction
resulting from the receipt or disposition of any property described in
clause (2) of this subsection, or from the exercise of any right of set-off
which the Trustee could have exercised if a petition in bankruptcy had been
filed by or against the Issuer upon the date of such default; and
(2) all property received by the Trustee in respect of any claim as
such creditor, either as security therefor, or in satisfaction or
composition thereof, or otherwise, after the beginning of such four months'
period, or an amount equal to the proceeds of any such property if disposed
of, subject, however, to the rights, if any, of the Issuer and its other
creditors in such property or such proceeds.
Nothing herein contained, however, shall affect the right of the
Trustee:
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(A) to retain for its own account (i) payments made on account of any
such claim by any person (other than the Issuer) who is liable thereon,
(ii) the proceeds of the bona fide sale of any such claim by the Trustee to
a third person, and (iii) distributions made in cash, securities or other
property in respect of claims filed against the Issuer in bankruptcy or
receivership or in proceedings for reorganization pursuant to Title 11 of
the United States Code or applicable state law;
(B) to realize, for its own account, upon any property held by it as
security for any such claim, if such property was so held prior to the
beginning of such four months' period;
(C) to realize, for its own account, but only to the extent of the
claim hereinafter mentioned, upon any property held by it as security for
any such claim, if such claim was created after the beginning of such four
months' period and such property was received as security therefor
simultaneously with the creation thereof, and if the Trustee shall sustain
the burden of proving that at the time such property was so received the
Trustee had no reasonable cause to believe that a default as defined in
subsection (c) of this Section would occur within four months; or
(D) to receive payment on any claim referred to in clause (B) or (C)
of this subsection, against the release of any property held as security
for such claim as provided in such clause (B) or (C), as the case may be,
to the extent of the fair value of such property,
For the purposes of clauses (B), (C) and (D), property substituted
after the beginning of such four months period for property held as security
at the time of such substitution shall, to the extent of the fair value of
the property released, have the same status as the property released, and, to
the extent that any claim referred to in any of such clauses is created in
renewal of or in substitution for or for the purpose of repaying or refunding
any pre-existing claim of the Trustee as such creditor, such claim shall have
the same status as such pre-existing claim.
If the Trustee shall be required to account, the funds and property
held in such special account and the proceeds thereof shall be apportioned
among the Trustee, the Holders and the holders of other indenture securities
in such manner that the Trustee, the Holders and the holders of other
indenture securities realize, as a result of payments from such special
account and payments of dividends on claims filed against the Issuer in
bankruptcy or receivership or in proceedings for reorganization pursuant to
Title 11 of the United States Code or
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applicable State law, the same percentage of their respective claims, figured
before crediting to the claim of the Trustee anything on account of the
receipt by it from the Issuer of the funds and property in such special
account and before crediting to the respective claims of the Trustee, the
Holders and the holders of other indenture securities dividends on claims
filed against the Issuer in bankruptcy or receivership or in proceedings for
reorganization pursuant to Title 11 of the United States Code or applicable
State law, but after crediting thereon receipts on account of the
indebtedness represented by their respective claims from all sources other
than from such dividends and from the funds and property so held in such
special account. As used in this paragraph with respect to any claim, the
term "dividends" shall include any distribution with respect to such claim,
in bankruptcy or receivership or in proceedings for reorganization pursuant
to Title 11 of the United States Code or applicable State law, whether such
distribution is made in cash, securities or other property, but shall not
include any such distribution with respect to the secured portion, if any, of
such claim. The court in which such bankruptcy, receivership or proceeding
for reorganization is pending shall have jurisdiction (i) to apportion among
the Trustee, the Holders and the holders of other indenture securities, in
accordance with the provisions of this paragraph, the funds and property held
in such special account and the proceeds thereof, or (ii) in lieu of such
apportionment, in whole or in part, to give to the provisions of this
paragraph due consideration in determining the fairness of the distributions
to be made to the Trustee, the Holders and the holders of other indenture
securities with respect to their respective claims, in which event it shall
not be necessary to liquidate or to appraise the value of any securities or
other property held in such special account or as security for any such
claim, or to make a specific allocation of such distributions as between the
secured and unsecured portions of such claims, or otherwise to apply the
provisions of this paragraph as a mathematical formula.
Any Trustee who has resigned or been removed after the beginning of
such four-months' period shall be subject to the provisions of this
subsection as though such resignation or removal had not occurred. If any
Trustee has resigned or been removed prior to the beginning of such
four-months' period, it shall be subject to the provisions of this subsection
if and only if the following conditions exist:
(i) the receipt of property or reduction of claim which would have
given rise to the obligation to account, if such Trustee had continued as
trustee, occurred after the beginning of such four-months' period; and
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(ii) such receipt of property or reduction of claim occurred within
four months after such resignation or removal.
(b) There shall be excluded from the operation of this Section a
creditor relationship arising from:
(1) ownership or acquisition of securities issued under any
indenture or any security or securities having a maturity of one year or
more at the time of acquisition by the Trustee;
(2) advances authorized by a receivership or bankruptcy court of
competent jurisdiction or by this indenture for the purpose of preserving
any property which shall at anytime be subject to the lien of this
Indenture or of discharging tax liens or other prior liens or encumbrances
thereon, if notice of such advance and of the circumstances surrounding the
making thereof is given to the Securityholders at the time and in the
manner provided in this Indenture;
(3) disbursements made in the ordinary course of business in the
capacity of trustee under an indenture, transfer agent, registrar,
custodian, paying agent, fiscal agent or depositary, or other similar
capacity;
(4) an indebtedness created as a result of services rendered or
premises rented or an indebtedness created as a result of goods or
securities sold in a cash transaction as defined in subsection (c)(3) of
this Section;
(5) the ownership of stock or of other securities of a
corporation organized under the provisions of Section 25(a) of the Federal
Reserve Act, as amended, which is directly or indirectly a creditor of the
Issuer; or
(6) the acquisition, ownership, acceptance or negotiation of any
drafts, bills of exchange, acceptances or obligations which fall within the
classification of self-liquidating paper as defined in subsection (c)(4) of
this Section.
(c) As used in this Section:
(1) the term "default" shall mean any failure to
make payment in full of the principal of or interest upon any of the
Securities or upon the other indenture securities when and as such
principal or interest becomes due and payable;
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(2) the term "other indenture securities" shall mean securities
upon which the Issuer is an obligor (as defined in the Trust Indenture Act
of 1939) outstanding under any other indenture (i) under which the Trustee
is also trustee, (ii) which contains provisions substantially similar to
the provisions of subsection (a) of this Section and (iii) under which a
default exists at the time of the apportionment of the funds and property
held in said special account;
(3) the term "cash transaction" shall mean any transaction in
which full payment for goods or securities sold is made within seven days
after delivery of the goods or securities in currency or in checks or other
orders drawn upon banks or bankers and payable upon demand;
(4) the term "self-liquidating paper" shall mean any draft, bill
of exchange, acceptance or obligation which is made, drawn, negotiated or
incurred by the Issuer for the purpose of financing the purchase,
processing, manufacture, shipment, storage or sale of goods, wares or
merchandise and which is secured by documents evidencing title to,
possession of, or a lien upon, the goods, wares or merchandise or the
receivables or proceeds arising from the sale of the goods, wares or
merchandise previously constituting the security, provided the security is
received by the Trustee simultaneously with the creation of the creditor
relationship with the Issuer arising from the making, drawing, negotiating
or incurring of the draft, bill of exchange, acceptance or obligation; and
(5) the term "Issuer" shall mean any obligor upon the
Securities.
SECTION 6.14 APPOINTMENT OF AUTHENTICATING AGENT. As long as any
Securities of a series remain Outstanding, the Trustee may, by an instrument
in writing, appoint with the approval of the Issuer an authenticating agent
(the "Authenticating Agent") which shall be authorized to act on behalf of,
but subject to the direction of, the Trustee to authenticate Securities of
such series, including Securities issued upon exchange, registration of
transfer, partial redemption or pursuant to Section 2.9. Securities of such
series so authenticated shall be entitled to the benefits of this Indenture
and shall be valid and obligatory for all purposes as if authenticated by the
Trustee. Whenever reference is made in this Indenture to the authentication
and delivery of Securities of any series by the Trustee or to the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating
Agent for such series and a certificate of authentication executed on behalf
of the Trustee by such Authen-
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ticating Agent. Such Authenticating Agent shall at all times be a
corporation organized and doing business under the laws of the United States
of America or of any State thereof or of the District of Columbia authorized
under such laws to exercise corporate trust powers, having a combined capital
and surplus of at least $5,000,000 (determined as provided in Section 6.9
with respect to the Trustee) and subject to supervision or examination by
Federal or State authority.
Any corporation into which any Authenticating Agent may be merged
or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which any
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of any Authenticating Agent,
shall be the successor to such Authenticating Agent with respect to all
series of Securities for which it served as Authenticating Agent without the
execution or filing of any paper or any further act on the part of the
Trustee or such Authenticating Agent.
Any Authenticating Agent may at any time, and if it shall cease to
be eligible hereunder shall, resign by giving written notice of resignation
to the Trustee and to the Issuer. The Trustee may at any time terminate the
agency of any Authenticating Agent by giving written notice thereof to such
Authenticating Agent and the Issuer. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time any
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee shall upon receipt of an Issuer order
appoint a successor Authenticating Agent and shall provide notice of such
appointment to all Holders of Securities affected thereby in the manner and
to the extent provided in Section 6.11 with respect to the appointment of a
successor trustee. Any successor Authenticating Agent upon acceptance of its
appointment hereunder shall become vested with all rights, powers and duties
of its predecessor hereunder, with like effect as if originally named as an
Authenticating Agent.
Sections 6.2, 6.3, 6.4, 6.6 (except for the last sentence thereof)
and 7.3 shall be applicable to any Authenticating Agent.
ARTICLE SEVEN
CONCERNING THE SECURITYHOLDERS
SECTION 7.1 EVIDENCE OF ACTION TAKEN BY SECURITYHOLDERS. Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be given or taken by a specified percentage
in
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aggregate principal amount of the Holders of one or more series may be
evidenced by one or more instruments of substantially similar tenor signed by
such specified percentage of Holders in person or by agent or proxy duly
appointed in writing; and, except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
delivered to the Trustee.
SECTION 7.2 PROOF OF EXECUTION OF INSTRUMENTS AND OF HOLDING OF
SECURITIES. Subject to Sections 6.1 and 6.2, proof of the execution of any
instrument by a Holder or his agent or proxy shall be sufficient if made in
accordance with such reasonable rules and regulations as may be prescribed by
the Trustee or in such manner as shall be satisfactory to the Trustee.
Subject to Sections 6.1 and 6.2, proof of the holding by any Person of any of
the Securities of any series shall be sufficient if made in the following
manner:
(a) The ownership of an Unregistered Security of any series, or of
any Coupon attached thereto at its issuance, and the identifying number of
such Security and the date of such ownership, may be proved by the
production of such Security or Coupon or by a certificate executed by any
trust company, bank, banker or recognized securities dealer, wherever
situated, if such certificate shall be deemed by the Trustee to be
satisfactory. Each such certificate shall be dated and shall state that on
the date thereof a Security of such series bearing a specified identifying
number was deposited with or exhibited to such trust company, bank, banker
or recognized securities dealer by the person named in such certificate.
Any such certificate may be issued in respect of one or more Unregistered
Securities of one or more series specified therein. The ownership by the
Person named in any such certificate of any Unregistered Security specified
therein shall be presumed to continue unless at the time of any
determination of such ownership and holding (1) another certificate bearing
a later date issued in respect of such Security shall be produced, (2) such
security shall be produced by some other Person or (3) such Security shall
have ceased to be Outstanding.
Subject to Sections 6.1 and 6.2, the fact and date of the execution of any
such instrument and the ownership, amount and numbers of any Unregistered
Securities may also be proven in accordance with such reasonable rules and
regulations as may be prescribed by the Trustee for any series or in any
other manner which the Trustee may deem sufficient.
(b) In the case of Registered Securities, the ownership of such
Securities shall be proved by the Security Register or by a certificate of
the Security Registrar.
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SECTION 7.3 HOLDERS TO BE TREATED AS OWNERS. The Issuer, the
Trustee and any agent of the Issuer or the Trustee may deem and treat the
Person in whose name any Security of any series shall be registered upon the
Security Register for such series as the absolute owner of such Security
(whether or not such Security shall be overdue and notwithstanding any
notation of ownership or other writing thereon) for the purpose of receiving
payment of or on account of the principal of and, subject to the provisions
of this Indenture, interest on such security and for all other purposes; and
none of the Issuer, the Trustee and any agent of the Issuer or the Trustee
shall be affected by any notice to the contrary. The Issuer, the Trustee and
any agent of the Issuer or the Trustee may treat the Holder of any
Unregistered Security and the Holder of any Coupon as the absolute owner of
such Unregistered Security or Coupon (whether or not such Unregistered
Security or Coupon shall be overdue) for the purpose of receiving payment
thereof or on account thereof and for all other purposes; and none of the
Issuer, the Trustee and any agent of the Issuer or the Trustee shall be
affected by any notice to the contrary. All such payments so made to any
such Person, or upon his order, shall be valid, and, to the extent of the sum
or sums so paid, effectual to satisfy and discharge the liability for moneys
payable upon any such Security or Coupon.
SECTION 7.4 SECURITIES OWNED BY ISSUER DEEMED NOT OUTSTANDING. In
determining whether the Holders of the requisite aggregate principal amount
of Outstanding Securities of one or more series have concurred in any
direction, consent or waiver under this Indenture, Securities which are owned
by the Issuer or any other obligor on the Securities with respect to which
such determination is being made or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
the Issuer or any other obligor on the Securities with respect to which such
determination is being made shall be disregarded and deemed not to be
Outstanding for the purposes of any such determination, except that for the
purpose of determining whether the Trustee shall be protected in relying on
any such direction, consent or waiver, only Securities which the Trustee
knows are so owned shall be so disregarded. Securities so owned which have
been pledged in good faith may be regarded as outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Securities and that the pledgee is not the Issuer or any
other obligor upon such Securities or any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
the Issuer or any other obligor on such Securities. In case of a dispute as
to such right, the advice of counsel shall be full protection in respect of
any decision made by the Trustee in accordance with such advice. Upon request
of the Trustee, the Issuer shall furnish to the Trustee promptly an Officers'
Certificate listing and identifying
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all Securities, if any, known by the Issuer to be owned or held by or for the
account of any of the above described Persons; and, subject to Sections 6.1
and 6.2, the Trustee shall be entitled to accept such Officers' Certificate
as conclusive evidence of the facts therein set forth and of the fact that
all securities not listed therein are Outstanding for the purposes of any
such determination.
SECTION 7.5 RIGHT OF REVOCATION OF ACTION TAKEN. At any time
prior to (but not after) the evidencing to the Trustee, as provided in
Section 7.1, of the taking of any action by the Holders of the requisite
percentage in aggregate principal amount of the Securities of one or more
series, as the case may be, specified in this Indenture in connection with
such action, any Holder of a Security the serial number of which is shown by
the evidence to be included among the serial numbers of the Securities the
Holders of which have consented to such action may, by filing written notice
at the Corporate Trust Office and upon proof of ownership as provided in
Section 7.2, revoke such action so far as concerns such Security. Except as
aforesaid, any such action taken by the Holder of any Security of any series
shall be conclusive and binding upon such Holder and upon all future Holders
and owners of such Security and of any Securities of such series issued in
exchange or substitution therefor or on registration of transfer thereof,
irrespective of whether or not any notation in regard thereto is made upon
any such Security. Any action taken by the Holders of the requisite
percentage in aggregate principal amount of the Securities of one or more
series, as the case may be, specified in this Indenture in connection with
such action shall be conclusively binding upon the Issuer, the Trustee and
the Holders of all the Securities of such series.
With respect to Registered Securities, the Issuer may, but shall
not be obligated to, fix a record date for the purpose of determining the
Securityholders entitled to give their consent or take any other action
described above. If a record date is fixed, then notwithstanding the
immediately preceding paragraph those Persons who were Holders of such
Registered Securities at such record date (or their duly designated proxies),
and only those Persons, shall be entitled to give such consent or to revoke
any consent previously given or to take any such action with respect to such
Registered Securities, whether or not such Persons continue to be Holders
after such record date. No such consent shall be valid or effective for more
than 120 days after such record date.
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ARTICLE EIGHT
SUPPLEMENTAL INDENTURES
SECTION 8.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF
SECURITYHOLDERS. The Issuer, when authorized by a resolution of the Board of
Directors (which resolution may provide general terms or parameters for such
action and may provide that the specific terms of such action may be determined
in accordance with or pursuant to an Issuer Order), and the Trustee may, from
time to time and at any time, enter into an indenture or indentures supplemental
hereto (which shall conform to the provisions of the Trust Indenture Act of 1939
as in force at the date of the execution thereof) for one or more of the
following purposes:
(a) subject to Section 3.6, to convey, transfer, assign, mortgage or
pledge to the Trustee as security for the Securities of one or more series
any property or assets;
(b) to add guarantees with respect to the Securities of one or more
series;
(c) to evidence the succession of another corporation to the Issuer,
or successive successions, and the assumption by the successor corporation
of the covenants, agreements and obligations of the Issuer pursuant to
Article Nine;
(d) to add to the covenants of the Issuer such further covenants,
restrictions, conditions or provisions as the Issuer and the Trustee shall
consider to be for the protection of the Holders of Securities of any
series or Coupons appertaining thereto, and to make the occurrence, or the
occurrence and continuance, of a default in complying with any such
additional covenant, restriction, condition or provision an Event of
Default permitting the enforcement of all or any of the several remedies
provided in this Indenture as herein set forth; in respect of any such
additional covenant, restriction, condition or provision, such supplemental
indenture may provide for a particular period of grace after default (which
period may be shorter or longer than that allowed in the case of other
defaults) or may provide for an immediate enforcement upon such an Event of
Default or may limit the remedies available to the Trustee upon such an
Event of Default or may limit the right of the Holders of a majority in
aggregate principal amount of the Securities of such series to waive such
an Event of Default;
(e) to cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be defective or
inconsistent with any other provision contained herein or in any
supplemental
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indenture, or to make such other provisions as the Issuer may
deem necessary or desirable, PROVIDED that no such action shall adversely
affect the interests of the Holders of the Securities of any series or the
Coupons appertaining thereto;
(f) to establish the form and terms of the securities of any series
or of the Coupons appertaining to such Securities, as permitted by
Sections 2.1 and 2.3;
(g) to evidence and provide for the acceptance of appointment
hereunder by a successor trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of
the trusts hereunder by more than one trustee, all as provided in Section
6.11;
(h) to provide for uncertificated Securities in addition to or in
place of certificated Securities; PROVIDED, HOWEVER, that the
uncertificated Securities are issued in registered form for purposes of
Section 163(f) of the Internal Revenue Code of 1986, as amended, or in a
manner such that the uncertificated Securities are described in Section
163(f)(2)(B) of the Internal Revenue Code of 1986, as amended; and
(i) to comply with any requirements of the Commission in connection
with qualifying this Indenture under the Trust Indenture Act of 1939.
The Trustee is hereby authorized to join with the Issuer in the
execution of any such supplemental indenture, to make any further appropriate
agreements and stipulations which may be therein contained and to accept the
conveyance, transfer, assignment, mortgage or pledge of any property or
assets thereunder, but the Trustee shall not be obligated to enter into any
such supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
Any supplemental indenture authorized by the provisions of this
Section may be executed without the consent of the Holders of any of the
Securities at the time Outstanding, notwithstanding any of the provisions of
Section 8.2.
SECTION 8.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF
SECURITYHOLDERS. With the consent (evidenced as provided in Article Seven) of
the Holders of not less than a majority in aggregate principal amount of the
Securities of all series at the time Outstanding affected by such
supplemental indenture (voting as one class), the Issuer, when authorized by
a resolution of the Board of Directors (which resolution may provide general
terms or
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parameters for such action and may provide that the specific terms of such
action may be determined in accordance with or pursuant to an Issuer order),
and the Trustee may, from time to time and at any time, enter into an
indenture or indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act of 1939 as in force at the date of
execution thereof) for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of any
supplemental indenture or of modifying in any manner the rights of the
Holders of the Securities of each such series or of the Coupons appertaining
to such Securities; provided that no such supplemental indenture shall (a)
extend the time of payment of the principal, or any installment of the
principal, of any Security or reduce the principal amount thereof, or reduce
the rate, alter the method of computation of the rate, or extend the time of
payment of interest thereon, or reduce any amount payable on the redemption
thereof, or make the principal thereof or the interest thereon payable in any
coin or currency other than that provided in such Security and the Coupons,
if any, appertaining thereto or in accordance with the terms thereof, or
reduce the amount of the principal of an original Issue Discount Security
that would be due and payable upon an acceleration of the maturity thereof
pursuant to Section 5.1 or the amount thereof provable in bankruptcy,
pursuant to Section 5.2, or alter the provisions of Section 11.11 or 11.12,
or impair or affect the right to institute suit for the payment thereof when
due or, if such Security shall so provide, any right of repayment at the
option of the Holder, in each case without the consent of the Holder of each
Security so affected, or (b) reduce the percentage in principal amount of the
Outstanding Securities of the affected series, the consent of whose Holders
is required for any such supplemental indenture or for any waiver provided
for in this Indenture, without the consent of the Holders of each Security so
affected.
A supplemental indenture which changes or eliminates any covenant
or other provision of this Indenture which has expressly been included solely
for the benefit of one or more series of Securities, or which modifies the
rights of the Holders of Securities of such series or of the Coupons
appertaining to such Securities with respect to such covenant or provision,
shall be deemed not to affect the rights under this Indenture of the Holders
of Securities of any other series or of the Coupons pertaining to such
Securities.
Upon the request of the Issuer, accompanied by a Board Resolution
complying with the first paragraph of this Section and evidence of the
consent of the Holders of the Securities as aforesaid and such other
documents, if any, as may be required by Section 7.1, the Trustee shall join
with the Issuer in the execution of such supplemental indenture unless such
supplemental indenture affects the Trustee's own rights, duties or immunities
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under this Indenture or otherwise, in which case the Trustee may in its
discretion, but shall not be obligated to, enter into such supplemental
indenture.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
Promptly after the execution by the Issuer and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the
Trustee shall give notice thereof (i) to the Holders of then Outstanding
Registered Securities of each series affected thereby, by mailing a notice
thereof by first-class mail to such Holders at their addresses as they shall
appear on the Security Register, (ii) if any unregistered Securities of a
series affected thereby are then Outstanding, to the Holders thereof who have
filed their names and addresses with the Trustee pursuant to Section
4.4(c)(ii), by mailing a notice thereof by first-class mail to such Holders
at such addresses as were so furnished to the Trustee and (iii) if any
Unregistered Securities of a series affected thereby are then Outstanding, to
all Holders thereof, by publication of a notice thereof at least once in each
Authorized Newspaper with respect to such series, and in each case such
notice shall set forth in general terms the substance of such supplemental
indenture. Any failure of the Issuer to give such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of any
such supplemental indenture.
SECTION 8.3 EFFECT OF SUPPLEMENTAL INDENTURE. Upon the execution
of any supplemental indenture pursuant to the provisions hereof, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith and the respective rights, limitations of rights, obligations,
duties and immunities under this Indenture of the Trustee, the Issuer and the
Holders of Securities of each series affected thereby shall thereafter be
determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.
SECTION 8.4 DOCUMENTS TO BE GIVEN TO TRUSTEE. The Trustee,
subject to the provisions of Sections 6.1 and 6.2, may receive an Officers'
Certificate and an Opinion of Counsel as conclusive evidence that any
supplemental indenture executed pursuant to this Article complies with the
applicable provisions of this Indenture.
SECTION 8.5 NOTATION ON SECURITIES IN RESPECT OF SUPPLEMENTAL
INDENTURES. Securities of any series authenticated
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and delivered after the execution of any supplemental indenture pursuant to
the provisions of this Article may bear a notation in form approved by the
Trustee as to any matter provided for by such supplemental indenture. If a
supplemental indenture changes the terms of a Security, the Trustee may
require the Holder of such Security to deliver it to the Trustee, and the
Trustee may place an appropriate notation on the Security regarding the
changed terms and return it to such Holder. Alternatively, if the Issuer or
the Trustee shall so determine, new Securities of any series so modified as
to conform, in the opinion of the Trustee and the Issuer, to any modification
of this Indenture contained in any such supplemental indenture may be
prepared by the Issuer, authenticated by the Trustee and delivered in
exchange for the Securities of such series then Outstanding. Any failure to
make any such notation or to issue a new Security shall not, however, in any
way impair or affect the validity of any such supplemental indenture or any
such Security the terms of which are changed.
ARTICLE NINE
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.1 COVENANT OF ISSUER NOT TO MERGE, CONSOLIDATE, SELL OR
CONVEY PROPERTY EXCEPT UNDER CERTAIN CONDITIONS. Nothing contained in this
Indenture or in any of the Securities shall prevent any consolidation of the
Issuer with, or merger of the Issuer into, any other Person or Persons
(whether or not affiliated with the Issuer), or successive consolidations or
mergers to which the Issuer or its successor or successors shall be a party
or parties, or shall prevent any sale, lease or conveyance of the property of
the Issuer as an entirety or substantially as an entirety; PROVIDED, that,
and the Issuer hereby covenants and agrees, upon any such consolidation,
merger, sale, lease or conveyance, the due and punctual payment of the
principal of and interest on all the Securities, according to their tenor,
and the due and punctual performance and observance of all of the covenants,
conditions and other obligations of this Indenture and the Securities to be
performed or observed by the Issuer, shall be expressly assumed, by
supplemental indenture satisfactory in form to the Trustee, executed and
delivered to the Trustee by the Person formed by such consolidation, or into
which the Issuer shall have been merged, or which shall have acquired such
property; PROVIDED, FURTHER, that the Person formed by such consolidation or
into which the Issuer is merged or the Person which acquired by conveyance or
sale, or which leases, the properties and assets of the Issuer as an entirety
or substantially as an entirety shall be either (i) a Person organized and
existing under the laws Of the United States, any state thereof or the
District of Columbia or (ii) a Person organized and existing under the laws
of Canada, Japan,
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Australia, New Zealand, any Specified European Nation or of any political
subdivision of any thereof and such Person undertakes to pay to the Holders
of Securities any additional amounts as may be necessary in order that every
net payment of principal of and interest, if any, on the Securities, after
withholding for or on account of any present or future tax, assessment or
governmental charge imposed upon such Holder (except for a tax, assessment or
charge imposed solely as a result of a connection between the recipient and
the jurisdiction imposing such tax assessment or charge) by reason of or as a
result of such payment being made by an entity which is not a Person existing
under the laws of the United States or any state thereof or the District of
Columbia, will not be less than the amount provided for in the Securities to
be then due and payable; and PROVIDED, FURTHER, that immediately after giving
effect to such transaction (and treating any Secured Debt or Sale and
Leaseback Transaction which becomes an obligation of the resulting, surviving
or transferee Person as a result of such transaction as having been incurred
or entered into by such Person at the time of such transaction), no Event of
Default, and no event which, after notice or lapse of time or both, would
become an Event of Default, shall have happened and be continuing.
SECTION 9.2 SECURITIES TO BE SECURED IN CERTAIN EVENTS. If, upon
any such consolidation or merger of the Issuer or upon any such sale, lease
or conveyance of the property of the Issuer as an entirety or substantially
as an entirety to any other Person, any property owned by the Issuer
immediately prior thereto would thereupon become subject to any Lien (unless
the Secured Debt in respect of such Lien could have been incurred by the
Issuer without its being required by the provisions of Section 3.6 to secure
the Securities equally and ratably with (or prior to) such Secured Debt), the
Issuer, prior to any such consolidation, merger, sale, lease or conveyance,
will by indenture supplemental hereto secure the Securities (together with,
if the Issuer shall so determine, any other Debt incurred, assumed or
guaranteed by the Issuer ranking equally with, or prior to, the Securities,
whether then existing or thereafter created) by a direct Lien on such
property, prior to all Liens other than any theretofore existing thereon.
SECTION 9.3 SUCCESSOR PERSON SUBSTITUTED FOR ISSUER. In case of
any consolidation, merger, sale, lease or conveyance referred to in Section
9.1, and following such an assumption by the successor Person, such successor
Person shall succeed to and be substituted for the Issuer, with the same
effect as if it had been named herein.
Such successor Person may cause to be signed, and may issue either
in its own name or in the name of the Issuer prior to such succession, any or
all of the Securities issuable hereunder which theretofore shall not have
been signed by the
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Issuer and delivered to the Trustee; and, upon the order of such successor
Person, instead of the Issuer, and subject to all the terms, conditions and
limitations in this Indenture prescribed, the Trustee shall authenticate and
shall deliver any Securities which previously shall have been signed and
delivered by the officers of the Issuer to the Trustee for authentication,
and any Securities which such successor Person thereafter shall cause to be
signed and delivered to the Trustee for that purpose. All of the Securities
so issued shall in all respects have the same legal rank and benefit under
this Indenture as the Securities theretofore or thereafter issued in
accordance with the terms of this Indenture as though all of such Securities
had been issued at the date of the execution hereof.
In case of any such consolidation, merger, sale, lease or
conveyance such changes in phraseology and form (but not in substance) may be
made in the Securities thereafter to be issued as may be appropriate.
In the event of any such sale or conveyance (other than a
conveyance by way of lease), the Issuer or any successor Person which shall
theretofore have become such in the manner described in this Article shall be
discharged from all obligations and covenants under this Indenture and the
Securities and may be liquidated and dissolved.
SECTION 9.4 OFFICERS' CERTIFICATE AND OPINION OF COUNSEL
DELIVERED TO TRUSTEE. The Trustee, subject to the provisions of Sections 6.1
and 6.2, may receive an Officers' Certificate and an Opinion of Counsel each
stating that any such consolidation, merger, sale, lease or conveyance, that
any such assumption, that any such supplemental indenture and that any such
liquidation or dissolution, complies with the applicable provisions of this
Indenture.
ARTICLE TEN
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 10.1 SATISFACTION AND DISCHARGE OF INDENTURE. (A) If at
any time (a) the Issuer shall have paid or caused to be paid the principal of
and interest on all the securities of each series theretofore authenticated,
including all Coupons appertaining thereto (other than Securities and Coupons
appertaining thereto which have been destroyed, lost or stolen and which have
been replaced or paid as provided in Section 2.9), in accordance with the
terms of this Indenture and such Securities or (b) as to securities and
Coupons not so paid, the Issuer shall have delivered to the Trustee for
cancellation all Securities of each series theretofore authenticated and all
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coupons appertaining thereto (other than any Securities and Coupons
appertaining thereto which shall have been destroyed, lost or stolen and
which shall have been replaced or paid as provided in Section 2.9) or (c) as
to Securities and Coupons not so paid or delivered for cancellation, in the
case of any series of Securities as to which the exact amount (including the
currency of payment) of principal of and interest due can be determined at
the time of making the deposit referred to in clause (ii) below, (i) all the
Securities of such series and all Coupons appertaining thereto shall have
become due and payable, and (ii) the Issuer shall have irrevocably deposited
or caused to be deposited with the Trustee as trust funds the entire amount
in cash (other than moneys repaid by the Trustee or any paying agent to the
Issuer in accordance with Section 10.4) to pay the principal and interest on
all Securities of such series and Coupons appertaining thereto at maturity;
and if, in the case of (a), (b) or (c), the Issuer shall also pay or cause to
be paid all other sums payable hereunder by the Issuer, then this Indenture
shall, subject to Section 10.6, cease to be of further effect (except as to
(i) rights of registration of transfer and exchange of Securities and of
Coupons appertaining thereto and the Issuer's right of optional redemption,
if any, (ii) substitution of mutilated, defaced, destroyed, lost or stolen
Securities or Coupons, (iii) the rights of Holders of Securities and Coupons
appertaining thereto to receive payments of principal thereof and interest
thereon, upon the original stated due dates therefor (but not upon
acceleration), and remaining rights of such Holders to receive mandatory
sinking fund or analogous payments, if any, (iv) the rights, obligations,
duties and immunities of the Trustee hereunder, (v) the rights of Holders of
Securities and Coupons appertaining thereto as beneficiaries hereof with
respect to the property so deposited with the Trustee and payable to all or
any of them, (vi) the obligations of the Issuer under Sections 3.2, 3.3, 3.4,
4.1 and 9.3 and the first and second provisos of Section 9.1 and (vii) this
Article 10 pertinent to such continuing obligations); and the Trustee, on
demand of the Issuer accompanied by an Officers' Certificate and an Opinion
of Counsel, each stating that all conditions precedent herein provided for
relating to the satisfaction and discharge of this Indenture have been
complied with, and at the cost and expense of the Issuer, shall execute
proper instruments acknowledging such satisfaction and discharge of this
Indenture; provided that the rights of Holders of the Securities and Coupons
to receive amounts in respect of principal of and interest on the Securities
and Coupons held by them shall not be delayed longer than required by then
applicable mandatory rules or policies of any national securities exchange
upon which the Securities are listed. The Issuer agrees to reimburse the
Trustee for any costs or expenses thereafter reasonably and properly incurred
and to compensate the Trustee for any services thereafter reasonably and
properly rendered by the Trustee in connection with this Indenture or the
securities.
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(B) The following provisions shall apply to the Securities of each
series unless specifically otherwise provided in the Board Resolution,
Officers' Certificate or supplemental indenture relating thereto provided
pursuant to Section 2.3. In addition to discharge of this Indenture pursuant
to the next preceding paragraph (A), in the case of any series of Securities
as to which the exact amount (including the currency of payment) of principal
of and interest due can be determined at the time of making the deposit
referred to in subparagraph (a) below, the Issuer shall be deemed to have
paid and discharged the entire indebtedness on all the Securities of such
series and the Coupons appertaining thereto on the 91st day after the date of
such deposit, and the provisions of this Indenture with respect to the
Securities of such series and Coupons appertaining thereto shall, subject to
Section 10.6, no longer be in effect (except as to (i) rights of
registration of transfer and exchange of Securities of such series and of
Coupons appertaining thereto and the Issuer's right of optional redemption,
if any, (ii) substitution of mutilated, defaced, destroyed, lost or stolen
Securities or Coupons, (iii) the rights of Holders of Securities of such
series and Coupons appertaining thereto to receive payments of principal
thereof and interest thereon, upon the original stated due dates therefor
(but not upon acceleration), and remaining rights of such Holders to receive
mandatory sinking fund or analogous payments, if any, solely from the trust
fund referred to in subparagraph (a) below, (iv) the rights, obligations,
duties and immunities of the Trustee hereunder, (v) the rights of Holders of
Securities of such series and Coupons appertaining thereto as beneficiaries
hereof with respect to the property so deposited with the Trustee and payable
to all or any of them, (vi) the obligations of the Issuer under Sections 3.2,
3.3, 3.4, 4.1 and 9.3 and the first and second provisos of Section 9.1 and
(vii) this Article 10 pertinent to such continuing obligations); and the
Trustee, at the cost and expense of the Issuer, shall, at the Issuer's
request, execute proper instruments acknowledging the same, if:
(a) the Issuer shall have irrevocably deposited or caused to be
irrevocably deposited with the Trustee as a trust fund specifically pledged
as security for, and dedicated solely to, the benefit of the Holders of the
Securities of such series and Coupons appertaining thereto (i) cash in an
amount, or (ii) Government Obligations, maturing as to principal and
interest at such times and in such amounts as will insure the availability
of cash, or (iii) a combination thereof, sufficient in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay (A) the
principal and interest on all Securities of such series and Coupons
appertaining thereto on each date that such principal or interest is due
and payable and (B) any mandatory sinking fund or analogous
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payments on the dates on which such payments are due and payable in
accordance with the terms of this Indenture and the Securities of such
series;
(b) no Event of Default or event which, with notice or lapse of time
or both, would become an Event of Default with respect to the Securities of
such series shall have occurred and be continuing on the date of such
deposit or, insofar as clauses (e) and (f) of Section 5.1 are concerned, at
any time during the period ending on the 91st day after the date of such
deposit (it being understood that this condition shall not be deemed
satisfied until the expiration of such period);
(c) such deposit, defeasance and discharge shall not result in a
breach or violation of, or constitute a default under, this Indenture or
any other agreement or instrument to which the Issuer is a party or by
which it is bound;
(d) such deposit, defeasance and discharge shall not cause any
Securities of such series then listed on any national securities exchange
registered under the Exchange Act to be delisted;
(e) the Issuer shall have delivered to the Trustee an Opinion of
Counsel (which counsel shall be counsel selected by the Issuer with
national recognition in matters of federal income tax law) to the effect
that either (A) there has been a change in the applicable Federal income
tax law or (B) the Issuer has received from, or there has been published
by, the Internal Revenue Service a ruling to the effect that, and in any
such case referred to in clause (A) or (B) such Opinion of Counsel shall
confirm that based thereon, the Holders of the Securities of such series
then Outstanding and Coupons appertaining thereto will not recognize
income, gain or loss for Federal income tax purposes as a result of such
deposit, defeasance and discharge and will be subject to Federal income tax
on the same amounts, in the same manner and at the same times as would have
been the case if such deposit, defeasance and discharge had not occurred;
and
(f) the Issuer shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the defeasance contemplated by
this paragraph have been complied with.
(C) The Issuer shall be released from its obligations under
Sections 3.5, 3.6 and 3.7 and Article Nine (other than the first and second
provisos of Section 9.1 with respect to the Securities of a particular series
and any Coupons appertaining
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thereto Outstanding on and after the date the conditions set forth below are
satisfied (hereinafter, "covenant defeasance")). Covenant defeasance means
that, with respect to the Outstanding Securities of such series, the Issuer
may omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in Sections 3.5, 3.6 and 3.7 and Article
Nine, whether directly or indirectly by reason of any reference elsewhere
herein to any such Section or Article, by reason of any reference in such
Section or Article to any other provision herein or by reason of any
reference to any such Section or Article in any other document, and such
omission to comply shall not constitute an Event of Default under Section 5.1
with respect to the Outstanding Securities of such series, but the remainder
of this Indenture and other Outstanding Securities and Coupons shall be
unaffected thereby. The following shall be the conditions to application of
this paragraph (C):
(a) the Issuer shall have irrevocably deposited or caused to be
irrevocably deposited with the Trustee as a trust fund specifically pledged
as security for, and dedicated solely to, the benefit of the Holders of the
Securities of such series and Coupons appertaining thereto, (i) cash in an
amount, or (ii) Government Obligations, maturing as to principal and
interest at such times and in such amounts as will insure the availability
of cash, or (iii) a combination thereof, sufficient in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay (A) the
principal and interest on all Securities of such series and Coupons
appertaining thereto on each date that such principal or interest is due
and payable and (B) any mandatory sinking fund or analogous payments on the
dates on which such payments are due and payable in accordance with the
terms of this Indenture and the Securities of such series;
(b) no Event of Default or event which, with notice or lapse of time
or both, would become an Event of Default with respect to the Securities of
such series shall have occurred and be continuing on the date of such
deposit or, insofar as clauses (e) and (f) of Section 5.1 are concerned, at
any time during the period ending on the 91st day after the date of such
deposit (it being understood that this condition shall not be deemed
satisfied until the expiration of such period);
(c) such deposit and covenant defeasance shall not result in a breach
or violation of, or constitute a default under, this Indenture or any other
agreement or instrument to which the Issuer is a party or by which it is
bound;
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(d) such deposit and covenant defeasance shall not cause any
Securities of such series then listed on any national securities exchange
registered under the Exchange Act to be delisted;
(e) the Issuer shall have delivered to the Trustee an Opinion of
Counsel (which counsel shall be counsel selected by the Issuer with
national recognition in matters of federal income tax law) to the effect
that the Holders of the Securities of such series then Outstanding and
Coupons appertaining thereto will not recognize income, gain or loss for
Federal income tax purposes as a result of such deposit and covenant
defeasance and will be subject to Federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if
such deposit and covenant defeasance had not occurred; and
(f) the Issuer shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to such covenant defeasance have
been complied with.
SECTION 10.2 APPLICATION BY TRUSTEE OF FUNDS DEPOSITED FOR PAYMENT
OF SECURITIES. Subject to Section 10.4, all moneys deposited with the
Trustee pursuant to Section 10.1 in respect of the Outstanding Securities of
a particular series and the Coupons appertaining thereto shall be held in
trust and applied by it to the payment, either directly or through any paying
agent (including the Issuer acting as its own paying agent), to the Holders
of such Securities and Coupons of all sums due and to become due thereon for
principal and interest; but such money need not be segregated from other
funds except to the extent required by law.
SECTION 10.3 REPAYMENT OF MONEYS HELD BY PAYING AGENT. In
connection with the satisfaction and discharge of this Indenture with respect
to the Securities of any series, all moneys then held by any paying agent
under the provisions of this Indenture with respect to such series of
Securities shall, upon demand of the Issuer, be paid to the Trustee and
thereupon such paying agent shall be released from all further liability with
respect to such moneys.
SECTION 10.4 RETURN OF MONEYS HELD BY TRUSTEE AND PAYING AGENT
UNCLAIMED FOR TWO YEARS. Any moneys deposited with or paid to the Trustee or
any paying agent for the payment of the principal of or interest on any
Security of any series or Coupons appertaining thereto and not applied but
remaining unclaimed for two years after the date upon which such principal or
interest shall have become due and payable, shall, upon the written request
of the Issuer and unless otherwise required by mandatory provisions of
applicable escheat or abandoned or unclaimed property law, be repaid to the
Issuer by the Trustee or such paying agent, and the Holder of the Securities
of such series and of any Coupons appertaining thereto shall, unless
otherwise required by mandatory
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provisions of applicable escheat or abandoned or unclaimed property laws,
thereafter look only to the Issuer for any payment which such Holder may be
entitled to collect, and all liability of the Trustee or any paying agent
with respect to such moneys shall thereupon cease; provided, however, that
the Trustee or such paying agent, before being required to make any such
repayment with respect to moneys deposited with it for any payment (a) in
respect of Registered Securities of any series, shall at the expense of the
Issuer, mail by first-class mail to Holders of such Securities at their
addresses as they shall appear on the Security Register for the Securities of
such series, (b) in respect of Unregistered Securities of any series, shall
at the expense of the Issuer, mail by first-class mail to Holders of such
Securities who have filed their names and addresses with the Trustee pursuant
to Section 4.4(c)(ii) at such addresses as were so furnished to the Trustee
and (c) in respect of Unregistered Securities of any series, shall at the
expense of the Issuer cause to be published once, in each Authorized
Newspaper with respect to such series, notice that such moneys remain and
that, after a date specified therein, which shall not be less than 30 days
from the date of such mailing or publication, any unclaimed balance of such
moneys then remaining will be repaid to the Issuer.
SECTION 10.5 INDEMNITY FOR GOVERNMENT OBLIGATIONS. The Issuer
shall pay and indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against the Government Obligations deposited pursuant
to Section 10.1 or the principal or interest received in respect of such
Government Obligations, other than any such tax, fee or other charge which by
law is for the account of the Holders of the Securities and Coupons for whose
benefit such Government Obligations are held.
SECTION 10.6. REINSTATEMENT. If the Trustee or paying agent is
unable to apply any money or Government Obligation in accordance with this
Article 10 by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Issuer's obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to this Article 10 until such time as the
Trustee or paying agent is permitted to apply all such money or Government
Obligations in accordance with this Article 10; PROVIDED, HOWEVER, that, if
the Issuer has made any payment of interest on or principal of any Securities
because of the reinstatement of its obligations, the Issuer shall be
entitled, at its election, (a) to receive from the Trustee or paying agent,
as applicable, that portion of such money or
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Government Obligations equal to the amount of such payment or (b) to be
subrogated to the rights of the Holders of such Securities to receive such
payment from the money or Government Obligations held by the Trustee or
paying agent.
ARTICLE ELEVEN
MISCELLANEOUS PROVISIONS
SECTION 11.1 INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
OF ISSUER EXEMPT FROM INDIVIDUAL LIABILITY. No recourse under or upon any
obligation, covenant or agreement contained in this Indenture, or in any
Security or Coupon, or because of any indebtedness evidenced thereby, shall
be had against any incorporator, as such, or against any past, present or
future stockholder, officer or director, as such, of the Issuer or of any
successor, either directly or through the Issuer or any successor, under any
rule of law, statute or constitutional provision or by the enforcement of any
assessment or by any legal or equitable proceeding or otherwise, all such
liability being expressly waived and released by the acceptance of the
Securities and the Coupons appertaining thereto by the Holders thereof and as
part of the consideration for the issue of the Securities and the Coupons
appertaining thereto.
SECTION 11.2 PROVISIONS OF INDENTURE FOR THE SOLE BENEFIT OF
PARTIES AND HOLDERS OF SECURITIES AND COUPONS. Nothing in this Indenture, in
the Securities or Coupons appertaining thereto, expressed or implied, shall
give or be construed to give to any person, firm or corporation, other than
the parties hereto and their successors and the Holders of the Securities or
Coupons, if any, any legal or equitable right, remedy or claim under this
Indenture or under any covenant or provision herein contained, all such
covenants and provisions being for the sole benefit of the parties hereto and
their successors and of the Holders of the Securities or Coupons, if any.
SECTION 11.3 SUCCESSORS AND ASSIGNS OF ISSUER BOUND BY INDENTURE.
All the covenants, stipulations, promises and agreements in this Indenture
contained by or on behalf of the Issuer shall bind its successors and
assigns, whether so expressed or not.
SECTION 11.4 NOTICES AND DEMANDS ON ISSUER, TRUSTEE AND HOLDERS OF
SECURITIES AND COUPONS. Any notice or demand which by any provision of this
Indenture is required or permitted to be given or served by the Trustee or by
any Holder of Securities of any series or Coupons appertaining thereto to or
upon the Issuer may be given or served in person or by being deposited
postage prepaid in the United States mail, first-class
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mail (except as otherwise specifically provided herein), addressed (until
another address of the Issuer is filed by the Issuer with the Trustee) to
United States Cellular Corporation, 8410 West Bryn Mawr Avenue, Suite 700,
Chicago, Illinois 60631-3486, Attention: Chief Financial Officer. Any
notice, direction, request or demand by the Issuer or any Holder of
Securities of any series or Coupons appertaining thereto to or upon the
Trustee may be given or served in person or by being deposited postage
prepaid in the United States mail, first-class mail (except as otherwise
specifically provided herein), addressed (until another address of the
Trustee is filed by the Trustee with the Issuer) to the Corporate Trust
Office. Any notice required or permitted to be given or served by the Issuer
or by the Trustee to or upon (i) any Holders of Registered Securities of any
series or any Holders of Unregistered Securities who have filed their names
and addresses with the Trustee pursuant to Section 4.4(c)(ii), may be given
or served by being deposited in the United States mail, first-class mail
(except as otherwise specifically provided herein), addressed at their
addresses as they shall appear on the Security Register or at the addresses
so filed, respectively, and (ii) any Holders of other Unregistered
Securities, by publication at least once in each Authorized Newspaper with
respect to such series.
In any case where notice to the Holders of Securities is given by
mail, neither the failure to mail such notice, nor any defect in any notice
so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Indenture provides for
notice in any manner, such notice may be waived in writing by the person
entitled to receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice by Holders
shall be filed with the Trustee, but such filing shall not be a condition
precedent to the validity of any action taken in reliance upon such waiver.
In case, by reason of the suspension of or irregularities in
regular mail service, it shall be impracticable to mail notice to the Issuer
when such notice is required to be given pursuant to any provision of this
Indenture, then any manner of giving such notice as shall be reasonably
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice.
SECTION 11.5 OFFICERS' CERTIFICATES AND OPINIONS OF COUNSEL;
STATEMENTS TO BE CONTAINED THEREIN. Upon any application or demand by the
Issuer to the Trustee to take any action under any of the provisions of this
Indenture, the Issuer shall furnish to the Trustee an Officers' Certificate
stating that all conditions precedent provided for in this Indenture relating
to the proposed action have been complied with and an Opinion of Counsel
stating that in the opinion of such counsel
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all such conditions precedent have been complied with, except that in the
case of any such application or demand as to which the furnishing of such
documents is specifically required by any provision of this Indenture
relating to such particular application or demand, no additional certificate
or opinion need be furnished.
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or
covenant provided for in this Indenture shall include (a) a statement that
the person making such certificate or opinion has read such covenant or
condition, (b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained
in such certificate or opinion are based, (c) a statement that, in the
opinion of such person, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether or not
such covenant or condition has been complied with and (d) a statement as to
whether or not, in the opinion of such person, such condition or covenant has
been complied with.
Any certificate, statement or opinion of an officer of the Issuer
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of or representations by counsel, unless such officer knows that the
certificate or opinion of or representations with respect to the matters upon
which his certificate, statement or opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should know that the same
are erroneous. Any certificate, statement or opinion of counsel may be
based, insofar as it relates to factual matters, information with respect to
which is in the possession of the Issuer, upon the certificate, statement or
opinion of or representations by an officer or officers of the Issuer, unless
such counsel knows that the certificate, statement or opinion or
representations with respect to the matters upon which his certificate,
statement or opinion may be based as aforesaid are erroneous, or in the
exercise of reasonable care should know that the same are erroneous.
Any certificate, statement or opinion of an officer of the Issuer
or of counsel may be based, insofar as it relates to accounting matters, upon
a certificate or opinion of or representations by an accountant or firm of
accountants in the employ of the Issuer, unless such officer or counsel, as
the case may be, knows that the certificate or opinion or representations
with respect to the accounting matters upon which his certificate, statement
or opinion may be based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous.
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Any certificate or opinion of any independent firm of public
accountants filed with and directed to the Trustee shall contain a statement
that such firm is independent.
SECTION 11.6 PAYMENTS DUE ON SATURDAYS, SUNDAYS AND HOLIDAYS. If
the date of maturity of interest on or principal of the Securities of any
series or any coupons appertaining thereto or the date fixed for redemption
or repayment of any such Security or Coupon shall not be a Business Day, then
payment of interest or principal need not be made on such date, but may be
made on the next succeeding Business Day with the same force and effect as if
made on the date of maturity or the date fixed for redemption or repayment,
and no interest shall accrue for the period after such date.
SECTION 11.7 CONFLICT OF ANY PROVISION OF INDENTURE WITH TRUST
INDENTURE ACT OF 1939. If and to the extent that any provision of this
Indenture limits, qualifies or conflicts with another provision which is
required to be included herein by the Trust Indenture Act of 1939 (as it may
be amended from time to time), such required provision shall control.
SECTION 11.8 ILLINOIS LAW TO GOVERN. This Indenture and each
Security and Coupon shall be deemed to be a contract under the laws of the
State of Illinois, and for all purposes shall be construed in accordance with
the laws of such State, except as may otherwise be required by mandatory
provisions of law.
SECTION 11.9 COUNTERPARTS. This Indenture may be executed in any
number of counterparts, each of which shall be an original; but such
counterparts shall together constitute but one and the same instrument.
SECTION 11.10 EFFECT OF HEADINGS. The Article and Section
headings herein and the Table of Contents are for convenience only and shall
not affect the construction hereof.
SECTION 11.11 SECURITIES IN A FOREIGN CURRENCY OR IN ECU. Unless
otherwise specified in or pursuant to a Board Resolution, a supplemental
indenture or an Officers' Certificate delivered pursuant to Section 2.3 with
respect to a particular series of securities, whenever for purposes of this
Indenture any action may be taken by the Holders of a specified percentage in
aggregate principal amount of Securities of one or more series at the time
Outstanding and, at such time, there are Outstanding Securities of any series
which are denominated in a Foreign Currency (including ECUs), then the
principal amount of Securities of such series which shall be deemed to be
Outstanding for the purpose of taking such action shall be the amount of
Dollars that could be obtained for such amount at the Market Exchange Rate.
For purposes of this Section, Market Exchange
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Rate shall mean the noon Dollar buying rate in New York City for cable
transfers of such Foreign Currency as published by the Federal Reserve Bank
of New York; PROVIDED, HOWEVER, that in the case of ECUs, Market Exchange
Rate shall mean the rate of exchange determined by the commission of the
European Communities (or any successor thereto) as published in the Official
Journal of the European Communities (such publication or any successor
publication, the "Journal"). If such Market Exchange Rate is not available
for any reason with respect to such Foreign Currency or ECUs, the Trustee
shall use, in its sole discretion and without liability on its part, such
quotation of the Federal Reserve Bank of New York or, in the case of ECUs,
the rate of exchange as published in the Journal, as of the most recent
available date, or quotations or, in the case of ECUs, rates of exchange from
one or more major banks in The City of New York or in the country of issue of
the Foreign Currency in question, which for purposes of the ECU shall be
Brussels, Belgium, or such other quotations or, in the case of ECU, rates of
exchange as the Trustee shall deem appropriate. The provisions of this
paragraph shall also apply in connection with any other action taken by the
Holders of Securities pursuant to the terms of this Indenture, including
without limitation Section 5.1.
All decisions and determinations of the Trustee regarding the
Market Exchange Rate or any alternative determination provided for in the
preceding paragraph shall be in its sole discretion and shall, in the absence
of manifest error, be conclusive to the extent permitted by law for all
purposes and irrevocably binding upon the Issuer and all Holders.
SECTION 11.12 JUDGMENT CURRENCY. The Issuer agrees, to the
fullest extent that it may effectively do so under applicable law, that (a)
if for the purpose of obtaining judgment in any court it is necessary to
convert the sum due in respect of the principal of or interest on the
Securities of any series (the "Required Currency") into a currency in which a
judgment will be rendered (the "Judgment Currency"), the rate of exchange
used shall be the rate at which, in accordance with normal banking
procedures, the Trustee could purchase in The City of New York the Required
Currency with the Judgment Currency on the day on which final unappealable
judgment is entered, unless such day is not a New York Banking Day, in which
case, to the extent permitted by applicable law, the rate of exchange used
shall be the rate at which, in accordance with normal banking procedures, the
Trustee could purchase in The City of New York the Required Currency with the
Judgment Currency on the New York Banking Day next preceding the day on which
final unappealable judgment is entered and (b) its obligations under this
Indenture and the Securities of such series to make payments in the Required
currency (i) shall not be discharged or satisfied by any tender, or any
recovery pursuant to any judgment (whether or not entered in accordance with
clause (a)), in any currency other than the
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Required Currency, except to the extent that such tender or recovery shall
result in the effective receipt by the payee of the full amount of the
Required Currency expressed to be payable in respect of such payments, (ii)
shall be enforceable as an alternative or additional cause of action for the
purpose of recovering in the Required Currency the amount, if any, by which
such effective receipt shall fall short of the full amount of the Required
Currency so expressed to be payable and (iii) shall not be affected by
judgment being obtained for any other sums due under this Indenture. For
purposes of the foregoing, "New York Banking Day" means any day except a
Saturday, Sunday or a legal holiday in The City of New York or a day on which
banking institutions in The City of New York are authorized or required by
law or executive order to close.
ARTICLE TWELVE
REDEMPTION OF SECURITIES AND SINKING FUNDS
SECTION 12.1 APPLICABILITY OF ARTICLE. The provisions of this
Article shall be applicable to the Securities of any series which are
redeemable before their maturity or to any sinking fund for the retirement of
Securities of a series except as otherwise specified as contemplated by
Section 2.3 for Securities of any series.
SECTION 12.2 NOTICE OF REDEMPTION; PARTIAL REDEMPTIONS. Notice of
redemption to the Holders of Registered Securities of any series to be
redeemed as a whole or in part shall be given by mailing notice of such
redemption by first class mail, postage prepaid, at least 30 days and not
more than 60 days prior to the date fixed for redemption, to such Holders at
their last addresses as they shall appear upon the registry books for such
Securities. Notice of redemption to the Holders of Unregistered Securities
of any series to be redeemed as a whole or in part, who have filed their
names and addresses with the Trustee pursuant to Section 4.4(c)(ii), shall be
given by mailing notice of such redemption by first class mail, postage
prepaid, at least 30 days and not more than 60 days prior to the date fixed
for redemption, to such Holders at such addresses as were so furnished to the
Trustee (and, in the case of any such notice given by the Issuer, the Trustee
shall make such information available to the Issuer for such purpose).
Notice of redemption to all other Holders of Unregistered Securities of any
series shall be published in each Authorized Newspaper with respect to such
series once in each of three successive calendar weeks, the first publication
to be not less than 30 days nor more than 60 days prior to the date fixed for
redemption. Any notice which is mailed in the manner herein provided shall
be conclusively presumed to have been duly given, whether or not the Holder
receives the notice. Failure to give notice by mail, or
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any defect in the notice to the Holder of any Security of any series
designated for redemption as a whole or in part, shall not affect the
validity of the proceedings for the redemption of any other Security of such
series.
The notice of redemption to each such Holder shall specify the
principal amount of each Security of such series held by such Holder to be
redeemed, the date fixed for redemption, the redemption price, the place or
places of payment, that payment will be made upon presentation and surrender
of such Securities and, in the case of Securities with Coupons attached
thereto, of all Coupons appertaining thereto maturing after the date fixed
for redemption, that such redemption is pursuant to the mandatory or optional
sinking or other analogous fund, or both, if such be the case, that interest
accrued to the date fixed for redemption will be paid as specified in such
notice, that on and after said date interest thereon or on the portions
thereof to be redeemed will cease to accrue (unless the Issuer defaults in
making such redemption payment or the paying agent is prohibited from making
such payment pursuant to the terms of this Indenture) and that no
representation is made as to the correctness or accuracy of the CUSIP number,
if any, listed in such notice or printed on the Securities. In case any
Security is to be redeemed in part only, the notice of redemption shall state
the portion of the principal amount thereof to be redeemed and shall state
that on and after the date fixed for redemption, upon surrender of such
Security, a new Security or Securities of such series in authorized
denominations for an aggregate principal amount equal to the unredeemed
portion thereof will be issued.
The notice of redemption of Securities of any series to be redeemed
at the option of the Issuer shall be given by the Issuer or, at the Issuer's
request, by the Trustee in the name and at the expense of the Issuer, in
which case the Issuer will provide the Trustee with the information required
to be included in such notice by the preceding paragraph.
On or before the redemption date specified in the notice of
redemption given as provided in this Section, the Issuer will deposit with
the Trustee or with one or more paying agents (or, if the Issuer is acting as
its own paying agent, set aside, segregate and hold in trust as provided in
Section 3.4) an amount of money sufficient to redeem on the redemption date
all the Securities of any series so called for redemption (other than
Securities or portions of Securities called for redemption which have been
delivered by the Issuer to the Trustee for cancellation as provided in
Section 12.5) at the applicable redemption price, together with accrued
interest to the date fixed for redemption. The Issuer will deliver to the
Trustee at least 70 days prior to the date fixed for redemption an Officers'
Certificate stating the aggregate principal amount of Securities of each
series and, if applicable, the Tranche (as hereinafter defined) to be
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redeemed. In case of a redemption at the option of the Issuer prior to the
expiration of any restriction on such redemption, the Issuer shall deliver to
the Trustee, prior to the giving of any notice of redemption to Holders
pursuant to this Section, an Officers' Certificate stating that such
restriction has been complied with. If less than all the Securities of like
tenor and terms of any series (a "Tranche") are to be redeemed, the Trustee
shall select the particular Securities of such Tranche to be redeemed pro
rata or by lot or by a method that complies with the applicable legal and
securities exchange requirements, if any, and that the Trustee considers fair
and appropriate and in accordance with the methods generally used at the time
of selection by fiduciaries in similar circumstances. Securities may be
redeemed in part in multiples equal to the minimum authorized denomination
for Securities of such series or any multiple thereof. If less than all
Securities of unlike tenor and terms of a series are to be redeemed, the
particular Tranche of Securities to be redeemed shall be selected by the
Issuer. The Trustee shall promptly notify the issuer in writing of the
Securities of such series selected for redemption and, in the case of any
Securities selected for partial redemption, the principal amount thereof to
be redeemed. For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
of any series shall relate, in the case of any Security redeemed or to be
redeemed only in part, to the portion of the principal amount of such
Security which has been or is to be redeemed.
SECTION 12.3 PAYMENT OF SECURITIES CALLED FOR REDEMPTION. If
notice of redemption has been given as provided in Section 12.2, the
Securities or portions of Securities specified in such notice shall become
due and payable on the date and at the place stated in such notice at the
applicable redemption price, together with interest accrued to the date fixed
for redemption, and on and after said date (unless the Issuer shall default
in the payment of such Securities at the applicable redemption price,
together with interest accrued to said date) interest on the Securities or
portions of Securities so called for redemption shall cease to accrue, the
unmatured Coupons, if any, appertaining thereto shall be void and, except as
provided in Sections 6.5 and 10.4, such Securities shall cease from and after
the date fixed for redemption to be entitled to any benefit or security under
this Indenture, and the Holders thereof shall have no right in respect of
such Securities except the right to receive the applicable redemption price
thereof and unpaid interest to the date fixed for redemption. On
presentation and surrender of such Securities at a place of payment specified
in said notice, together with all Coupons, if any, appertaining thereto
maturing after the date fixed for redemption, such Securities or the
specified portions thereof shall be paid and redeemed by the Issuer at the
applicable redemption price, together with interest accrued thereon to the
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date fixed for redemption; provided that payment of interest becoming due on
or prior to the date fixed for redemption shall be payable, in the case of
Securities with Coupons attached thereto, to the Holders of the Coupons for
such interest upon surrender thereof or, in the case of Registered
Securities, to the Holders of such Registered Securities registered as such
on the relevant Record Date, subject to the terms and provisions of Sections
2.3 and 2.7.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid or duly
provided for, bear interest from the date fixed for redemption at the rate of
interest or Yield to Maturity (in the case of an Original Issue Discount
Security) borne by such Security.
If any Security with Coupons attached thereto is surrendered for
redemption and is not accompanied by all appurtenant Coupons maturing after
the date fixed for redemption, the surrender of such missing Coupon or
Coupons may be waived by the Issuer and the Trustee, if there be furnished to
each of them such security or indemnity as they may require to save each of
them harmless.
Upon presentation of any Security redeemed in part only, the Issuer
shall execute and the Trustee shall authenticate and deliver to or on the
order of the Holder thereof, at the expense of the Issuer, a new Security or
Securities of such series, of authorized denominations, in principal amount
equal to the unredeemed portion of the Security so presented.
SECTION 12.4 EXCLUSION OF CERTAIN SECURITIES FROM ELIGIBILITY FOR
SELECTION FOR REDEMPTION. Securities shall be excluded from eligibility for
selection for redemption if they are identified by registration and
certificate number in an Officers' Certificate delivered to the Trustee at
least 40 days prior to the last date on which notice of redemption may be
given as being owned of record and beneficially by, and not pledged or
hypothecated by, either (a) the Issuer or (b) an entity specifically
identified in such Officers' Certificate as directly or indirectly
controlling or controlled by or under direct or indirect common control with
the Issuer.
SECTION 12.5 MANDATORY AND OPTIONAL SINKING FUNDS. The minimum
amount of any sinking fund payment provided for by the terms of the
Securities of any series is herein referred to as a "mandatory sinking fund
payment", and any payment in excess of such minimum amount provided for by
the terms of the Securities of any series is herein referred to as an
"optional sinking fund payment". The date on which a sinking fund payment is
to be made is herein referred to as the "sinking fund payment date".
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In lieu of making all or any part of any mandatory sinking fund
payment with respect to any series of Securities in cash, the Issuer may at
its option (a) deliver to the Trustee Securities of such series theretofore
purchased or otherwise acquired (except upon redemption pursuant to the
mandatory sinking fund) by the Issuer or receive credit for Securities of
such series (not previously so credited) theretofore purchased or otherwise
acquired (except as aforesaid) by the Issuer and delivered to the Trustee for
cancellation pursuant to Section 2.10, (b) receive credit for optional
sinking fund payments (not previously so credited) made pursuant to this
Section or (c) receive credit for Securities of such series (not previously
so credited) redeemed by the Issuer through any optional redemption provision
contained in the terms of such series. Securities so delivered or credited
shall be received or credited by the Trustee at the sinking fund redemption
price specified in such Securities.
On or before the 60th day next preceding each sinking fund payment
date for any series, the Issuer will deliver to the Trustee an Officers'
Certificate (which need not contain the statements required by Section 11.5)
(a) specifying the portion of the mandatory sinking fund payment due on such
date to be satisfied by payment of cash and the portion to be satisfied by
credit of Securities of such series and the basis for such credit, (b)
stating that none of the Securities of such series to be so credited has
theretofore been so credited, (c) stating that no defaults in the payment of
interest or Events of Default with respect to such series have occurred
(which have not been waived or cured) and are continuing and (d) stating
whether or not the Issuer intends to exercise its right to make an optional
sinking fund payment on such date with respect to such series and, if so,
specifying the amount of such optional sinking fund payment which the Issuer
intends to pay on or before the next succeeding sinking fund payment date.
Any Securities of such series to be so credited and required to be delivered
to the Trustee in order for the Issuer to be entitled to credit therefor as
aforesaid which have not theretofore been delivered to the Trustee shall be
delivered for cancellation pursuant to Section 2.10 to the Trustee with such
Officers' Certificate (or reasonably promptly thereafter if acceptable to the
Trustee). Such Officers' Certificate shall be irrevocable, and upon its
receipt by the Trustee the Issuer shall become unconditionally obligated to
make all the cash payments or other deliveries therein referred to, if any,
on or before the next succeeding sinking fund payment date. Failure of the
Issuer, on or before any such 60th day, to deliver such Officers' Certificate
and Securities (subject to the parenthetical in the immediately preceding
sentence) specified in this paragraph, if any, shall not constitute a default
but shall constitute, on and as of such 60th day, the irrevocable election of
the Issuer that (i) the mandatory sinking fund payment for such series due on
the next succeeding sinking fund payment date
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shall be paid entirely in cash without the option to deliver or credit
Securities of such series in respect thereof and (ii) the Issuer will make no
optional sinking fund payment with respect to such series on such date as
provided in this Section.
If the sinking fund payment or payments (mandatory or optional or
both) to be made in cash on the next succeeding sinking fund payment date
plus any unused balance of any preceding sinking fund payments made in cash
shall exceed $50,000 (or the equivalent thereof in any Foreign Currency or
ECU), or any lesser sum in Dollars (or the equivalent thereof in any Foreign
Currency or ECU), if the Issuer shall so request with respect to the
Securities of any particular series, such cash shall be applied on the next
succeeding sinking fund payment date to the redemption of Securities of such
series at the applicable sinking fund redemption price, together with accrued
interest to the date fixed for redemption. If such amount shall be $50,000
(or the equivalent thereof in any Foreign Currency or ECU) or less and the
Issuer makes no such request, then such amount shall be carried over until a
sum in excess of $50,000 (or the equivalent thereof in any Foreign currency
or ECU) is available. The Trustee shall select, in the manner provided in
Section 12.2, for redemption on such sinking fund payment date a sufficient
principal amount of Securities of such series to absorb said cash, as nearly
as may be, and shall (if requested in writing by the Issuer) inform the
Issuer of the serial numbers of the Securities of such series (or portions
thereof) so selected. Securities shall be excluded from eligibility for
redemption under this Section if they are identified by registration and
certificate number in an Officers' Certificate delivered to the Trustee at
least 40 days prior to the sinking fund payment date as being owned of record
and beneficially by, and not pledged or hypothecated by either (a) the Issuer
or (b) an entity specifically identified in such Officers' Certificate as
directly or indirectly controlling or controlled by or under direct or
indirect common control with the Issuer. The Trustee, in the name and at the
expense of the Issuer (or the Issuer, if it shall so request the Trustee in
writing), shall cause notice of redemption of the Securities of such series
to be given in substantially the manner provided in Section 12.2 (and with
the effect provided in Section 12.3) for the redemption of Securities of such
series in part at the option of the Issuer. The amount of any sinking fund
payments not so applied or allocated to the redemption of Securities of such
series shall be added to the next cash sinking fund payment for such series
and, together with such payment, shall be applied in accordance with the
provisions of this Section. Any and all sinking fund moneys held on the
stated maturity date of the Securities of a particular series (or earlier, if
such maturity is accelerated), which are not held for the payment or
redemption of particular Securities of such series, shall be applied,
together with other moneys, if necessary, sufficient for the purpose, to the
payment of the
-90-
<PAGE>
principal of and interest on the Securities of such series at maturity.
Unless otherwise provided for, on or before each sinking fund
payment date, the Issuer shall pay to the Trustee in cash or shall otherwise
provide for the payment of all interest accrued to the date fixed for
redemption on Securities to be redeemed on such sinking fund payment date.
The Trustee shall not redeem or cause to be redeemed Securities of
any series with sinking fund moneys or give any notice of redemption of
Securities of such series by operation of the sinking fund for such series
during the continuance of a default in the payment of interest on the
Securities of such series or of any Event of Default with respect to such
series except that, if notice of redemption of any Securities of such series
shall theretofore have been given, the Trustee shall redeem or cause to be
redeemed such Securities, provided that the Trustee or one or more paying
agents shall have received from the Issuer a sum sufficient for such
redemption. Except as aforesaid, any moneys in the sinking fund for such
series at the time when any such default or Event of Default shall occur, and
any moneys thereafter paid into the sinking fund, shall, during the
continuance of such default or Event of Default, be deemed to have been
collected under Article Five and held for the payment of all Securities of
such series. In case such Event of Default shall have been waived as
provided in Section 5.10 or the default cured on or before the 60th day
preceding any sinking fund payment date, such moneys shall thereafter be
applied on such sinking fund payment date in accordance with this Section to
the redemption of Securities of such series.
-91-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed and delivered as of July 31, 1997.
UNITED STATES CELLULAR CORPORATION
By:_____________________________________
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO,
AS TRUSTEE
By:_____________________________________
Title: Vice President
[CORPORATE SEAL]
Attest:
By ______________________
Assistant Secretary
-92-
<PAGE>
EXHIBIT 5
[SIDLEY & AUSTIN]
July 30, 1997
United States Cellular Corporation
8410 West Bryn Mawr Avenue
Suite 700
Chicago, Illinois 60631
Re: $400,000,000 Principal Amount of Debt Securities
Ladies and Gentlemen:
We refer to the Registration Statement on Form S-3 (the "Registration
Statement") being filed by United States Cellular Corporation, a Delaware
corporation (the "Company"), with the Securities and Exchange Commission (the
"SEC") under the Securities Act of 1933, as amended (the "Securities Act"),
relating to the shelf registration of $400,000,000 principal amount of the
Company's debt securities (the "Debt Securities"). The Debt Securities are to be
issued under an Indenture to be dated as of August , 1997 between the Company
and The First National Bank of Chicago, as trustee (the "Trustee").
We are familiar with the proceedings to date with respect to the proposed
issuance and sale of the Debt Securities and have examined such records,
documents and questions of law, and satisfied ourselves as to such matters of
fact, as we have considered relevant and necessary as a basis for this opinion.
Based on the foregoing, we are of the opinion that:
1. The Company is duly incorporated and validly existing under the laws of
the State of Delaware.
2. The Company has corporate power and authority to execute and deliver the
Indenture and to authorize and sell the Debt Securities.
3. Each series of Debt Securities will be legally issued and binding
obligations of the Company (except to the extent enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or other similar laws affecting the enforcement of creditors' rights
generally and by the effect of general principles of equity, regardless of
whether enforceability is considered in a proceeding in equity or at law) when
(i) the Registration Statement, as finally amended (including any necessary
post-effective amendments), shall have become effective under the Securities Act
and the Indenture (including any necessary supplemental indenture) shall have
been qualified under the Trust Indenture Act of 1939, as amended, and duly
executed and delivered by the Company and the Trustee; (ii) a Prospectus
Supplement with respect to such series of Debt Securities shall have been filed
(or transmitted for filing) with the SEC pursuant to Rule 424 under the
Securities Act; (iii) the Company's Board of Directors or a duly authorized
committee thereof shall have duly adopted final resolutions authorizing the
issuance and sale of such series of Debt Securities as contemplated by the
Registration Statement and the Indenture; and (iv) such series of Debt
Securities shall have been duly executed and authenticated as provided in the
Indenture and such resolutions and shall have been duly delivered to the
purchasers thereof against payment of the agreed consideration therefor.
For the purposes of this opinion, we have assumed that there will be no
changes in the laws currently applicable to the Company and that such laws will
be the only laws applicable to the Company.
We do not find it necessary for the purposes of this opinion to cover, and
accordingly we express no opinion as to, the application of the securities or
blue sky laws of the various states to sales of the Debt Securities.
<PAGE>
This opinion is limited to the Securities Act, the laws of the State of
Illinois and the Delaware General Corporation Law.
The Company is controlled by Telephone and Data Systems, Inc. ("TDS") and
TDS is controlled by a voting trust. Walter C.D. Carlson, a trustee and
beneficiary of the voting trust and a director of TDS, the Company and certain
other subsidiaries of TDS, Michael G. Hron, the Secretary of TDS and certain
subsidiaries of TDS, William S. DeCarlo, the Assistant Secretary of TDS and
certain subsidiaries of TDS, Stephen P. Fitzell, the Secretary of the Company
and certain other subsidiaries of TDS, and Sherry S. Treston, the Assistant
Secretary of the Company and certain other subsidiaries of TDS, are partners of
this Firm.
We hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement and to all references to our Firm included in or made a
part of the Registration Statement.
Very truly yours,
/s/ SIDLEY & AUSTIN
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Form S-3 Registration Statement of United States Cellular
Corporation, of our report dated January 29, 1997 (except with respect to the
matter discussed in Note 16, as to which the date is February 4, 1997), on the
consolidated financial statements and financial statement schedule of United
States Cellular Corporation and Subsidiaries, included or incorporated by
reference in the United States Cellular Corporation Form 10-K for the year ended
December 31, 1996, and to the incorporation by reference in this Form S-3
Registration Statement of our compilation report dated February 25, 1997, on the
combined financial statements of the Los Angeles SMSA Limited Partnership, the
Nashville/Clarksville MSA Limited Partnership and the Baton Rouge MSA Limited
Partnership, included in the United States Cellular Corporation Form 10-K for
the year ended December 31, 1996. We also consent to all references to our Firm
included in this Form S-3 Registration Statement.
/s/ ARTHUR ANDERSEN LLP
Chicago, Illinois
July 29, 1997
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of United States
Cellular Corporation of our report dated February 25, 1997, relating to the
financial statements of Los Angeles SMSA Limited Partnership, which appears on
page 32 of the United States Cellular Corporation Annual Report on Form 10-K for
the year ended December 31, 1996. We also consent to the reference to us under
the heading "Experts."
/s/ PRICE WATERHOUSE LLP
San Francisco, California
July 29, 1997
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Form S-3
Registration Statement of United States Cellular Corporation of our report dated
February 17, 1995, of our audit of the financial statements of the Los Angeles
SMSA Limited Partnership as of December 31, 1994, and for the year then ended,
included in the United States Cellular Corporation Annual Report on Form 10-K
for the year ended December 31, 1996; such financial statements were not
included separately in such Form 10-K. We also consent to the reference to our
firm under the caption "Experts."
/s/ COOPERS & LYBRAND L.L.P.
Newport Beach, California
July 29, 1997
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of United States Cellular Corporation of our reports dated
February 7, 1997, February 9, 1996 and February 10, 1995, respectively, on our
audits of the financial statements of the Nashville/Clarksville MSA Limited
Partnership as of December 31, 1996, 1995 and 1994 and for the years ended
December 31, 1996, 1995 and 1994; such financial statements are not included
separately in this Registration Statement. We also consent to the reference to
our firm under the caption "Experts."
/s/ COOPERS & LYBRAND L.L.P.
Atlanta, Georgia
July 29, 1997
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of United States Cellular Corporation of our reports dated
February 7, 1997, February 9, 1996 and February 10, 1995, respectively, on our
audits of the financial statements of the Baton Rouge MSA Limited Partnership as
of December 31, 1996, 1995 and 1994 and for the years ended December 31, 1996,
1995 and 1994; such financial statements are not included separately in this
Registration Statement. We also consent to the reference to our firm under the
caption "Experts."
/s/ COOPERS & LYBRAND L.L.P.
Atlanta, Georgia
July 29, 1997
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)
-------------------
THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)
A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)
ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
THE FIRST NATIONAL BANK OF CHICAGO
ONE FIRST NATIONAL PLAZA, SUITE 0286
CHICAGO, ILLINOIS 60670-0286
ATTN: LYNN A. GOLDSTEIN, LAW DEPARTMENT (312) 732-6919
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
-------------------
UNITED STATES CELLULAR CORPORATION
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
DELAWARE 62-1147325
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
8410 WEST BRYN MAWR AVENUE, SUITE 700
CHICAGO, ILLINOIS 60631
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
DEBT SECURITIES
(TITLE OF INDENTURE SECURITIES)
<PAGE>
ITEM 1. GENERAL INFORMATION. FURNISH THE FOLLOWING
INFORMATION AS TO THE TRUSTEE:
(a) NAME AND ADDRESS OF EACH EXAMINING OR
SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.
The trustee is authorized to exercise corporate
trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.
No such affiliation exists with the trustee.
ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
PART OF THIS STATEMENT OF ELIGIBILITY.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
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.
2
<PAGE>
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national banking
association organized and existing under the laws of the United States of
America, has duly caused this Statement of Eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the City of Chicago
and the State of Illinois, on this 29th day of July, 1997.
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE
By /s/ Richard D. Manella
Richard D. Manella
Vice President
* EXHIBIT 1, 2, 3 AND 4 ARE HEREIN INCORPORATED BY REFERENCE TO EXHIBITS BEARING
IDENTICAL NUMBERS IN ITEM 16 OF THE FORM T-1 OF THE FIRST NATIONAL BANK OF
CHICAGO, FILED AS EXHIBIT 25.1 TO THE REGISTRATION STATEMENT ON FORM S-3 OF
SUNAMERICA, INC., FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER
25, 1996 (REGISTRATION NO. 333-14201).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
July 29, 1997
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between United
States Cellular Corporation and The First National Bank of Chicago, the
undersigned, in accordance with Section 321(b) of the Trust Indenture Act of
1939, as amended, hereby consents that the reports of examinations of the
undersigned, made by Federal or State authorities authorized to make such
examinations, may be furnished by such authorities to the Securities and
Exchange Commission upon its request therefor.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
By /s/ Richard D. Manella
Richard D. Manella
Vice President
4
<PAGE>
EXHIBIT 7
<TABLE>
<CAPTION>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR MARCH 31, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount
outstanding of the last business day of the quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN C400
THOUSANDS RCFD BIL MIL THOU
----------------- ----- -------------
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1). . . . . 0081 3,871,170 1.a.
b. Interest-bearing balances(2) . . . . . . . . . . . . . . . . . 0071 6,498,314 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A). . . 1754 0 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D) . 1773 3,901,208 2.b.
3. Federal funds sold and securities purchased under agreements to
resell 1350 4,612,975 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 2122 23,345,201 4.a.
b. LESS: Allowance for loan and lease losses. . . . . . . . . . . RCFD 3123 420,963 4.b.
c. LESS: Allocated transfer risk reserve. . . . . . . . . . . . . RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c) . . . . . . . . . . . . . 2125 22,924,238 4.d.
5. Trading assets (from Schedule RD-D) . . . . . . . . . . . . . . . 3545 8,792,158 5.
6. Premises and fixed assets (including capitalized leases). . . . . 2145 706,928 6.
7. Other real estate owned (from Schedule RC-M). . . . . . . . . . . 2150 6,563 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M). . . . . . . . . . . . . . . . . . 2130 61,551 8.
9. Customers' liability to this bank on acceptances outstanding. . . 2155 488,866 9.
10. Intangible assets (from Schedule RC-M). . . . . . . . . . . . . . 2143 291,569 10.
11. Other assets (from Schedule RC-F) . . . . . . . . . . . . . . . . 2160 1,775,283 11.
12. Total assets (sum of items 1 through 11). . . . . . . . . . . . . 2170 53,930,823 12.
___________________
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
5
<PAGE>
<S> <C> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
SCHEDULE RC-CONTINUED
DOLLAR AMOUNTS IN
THOUSANDS BIL MIL THOU
----------------- ------------
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1) . . . . . . . . . . . . . RCON 2200 21,550,056 13.a.
(1) Noninterest-bearing(1). . . . . . . . . . . . . . RCON 6631 8,895,137 13.a.1
(2) Interest-bearing. . . . . . . . . . . . . . . . . RCON 6636 12,654,919 13.a.2
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II). . . . . . . . . . RCFN 2200 12,364,650 13.b.
(1) Noninterest bearing . . . . . . . . . . . . . . . RCFN 6631 287,496 13.b.1
(2) Interest-bearing. . . . . . . . . . . . . . . . . RCFN 6636 12,077,154 13.b.2
14. Federal funds purchased and securities sold under agreements
to repurchase: RCFD 2800 3,817,421 14
15. a. Demand notes issued to the U.S. Treasury RCON 2840 63,621 15.a.
b. Trading Liabilities(from Schedule RC-D). . . . . . RCFD 3548 5,872,831 15b.
16. Other borrowed money:
a. With original maturity of one year or less . . . . RCFD 2332 2,607,549 16.a.
b. With original maturity of more than one year. . . RCFD 2333 322,414 16b.
17. Not applicable
18. Bank's liability on acceptance executed and outstanding . . RCFD 2920 488,866 18.
19. Subordinated notes and debentures . . . . . . . . . . RCFD 3200 1,550,000 19.
20. Other liabilities (from Schedule RC-G). . . . . . . . RCFD 2930 1,196,229 20.
21. Total liabilities (sum of items 13 through 20). . . . RCFD 2948 49,833,637 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus . . . . RCFD 3838 0 23.
24. Common stock. . . . . . . . . . . . . . . . . . . . . RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock). . RCFD 3839 2,944,244 25.
26. a. Undivided profits and capital reserves . . . . . . RCFD 3632 954,885 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities . . . . . . . . . . . . . . . . . . . . RCFD 8434 (1,089) 26.b.
27. Cumulative foreign currency translation adjustments . RCFD 3284 (1,712) 27.
28. Total equity capital (sum of items 23 through 27) RCFD 3210 4,097,186 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28) . . . . . . . . RCFD 3300 53,930,823 29.
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that
best describes the most comprehensive level of auditing work performed for
the bank by independent external
Number
auditors as of any date during 1996 . . . . . . . . . RCFD 6724 2 M.1.
1 = Independent audit of the bank conducted in accordance 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.
</TABLE>
6
