FORM OF
EDISON INTERNATIONAL
TO
THE BANK OF NEW YORK,
AS TRUSTEE
SUPPLEMENTAL INDENTURE NO. 3
Dated as of November 8, 2000
$350,000,000
Floating Rate Notes due 2001
<PAGE>
EDISON INTERNATIONAL
$350,000,000
Floating Rate Notes due 2001
SUPPLEMENTAL INDENTURE NO. 3
SUPPLEMENTAL INDENTURE No. 3, dated as of November 8, 2000, between
Edison International, a California corporation (the "Corporation"), and The Bank
of New York, a New York banking corporation, as successor Trustee (the
"Trustee") to Harris Trust and Savings Bank, an Illinois banking corporation.
RECITALS
The Corporation and the Trustee are parties to a Senior Indenture,
dated as of September 28, 1999, as amended and supplemented (the "Senior
Indenture"), providing for the issuance from time to time of series of the
Corporation's Securities.
Section 301 of the Senior Indenture provides for various matters with
respect to any series of Securities issued under the Senior Indenture to be
established in an indenture supplemental to the Senior Indenture.
Section 901 of the Senior Indenture provides for the Corporation and
the Trustee to enter into an indenture supplemental to the Senior Indenture to
establish the form or terms of Securities of any series as provided by Sections
201 or 301 of the Senior Indenture.
For and in consideration of the premises and the issuance of the series
of Securities provided for herein, it is mutually covenanted and agreed, for the
equal and proportionate benefit of the Holders of the Securities of such series,
as follows:
ARTICLE 1
RELATION TO INDENTURE; DEFINITIONS
Section 1.1. This Supplemental Indenture No. 3 constitutes an integral
part of the Senior Indenture.
Section 1.2. For all purposes of this Supplemental Indenture No. 3,
except as otherwise expressly provided or unless the context otherwise requires:
(A) capitalized terms used herein without definition will have the
meanings specified in the Senior Indenture;
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<PAGE>
(B) the terms defined in this Article have the meanings assigned to them
in this Article and include the plural as well as the singular;
(C) all other terms used herein which are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(D) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles,
and, except as otherwise herein expressly provided, the term "generally accepted
accounting principles" with respect to any computation required or permitted
hereunder shall mean such accounting principles as are generally accepted in the
United States of America;
(E) unless the context otherwise requires, any reference to an "Article"
or a "Section" refers to an Article or a Section, as the case may be, of this
Supplemental Indenture No. 3; and
(F) the words "herein," "hereof," "hereunder" and other words of similar
import refer to this Supplemental Indenture No. 3 as a whole and not to any
particular Article, Section or other subdivision.
(G) Specific Definitions:
(1) "Calculation Agent" means the Trustee, or its successor appointed by
the Corporation, acting as calculation agent.
(2) "Interest Determination Date" means the second London Business Day
immediately preceding the first day of the relevant Interest Period.
(3) "Interest Payment Date" shall have the meaning specified in Section
2.4 hereof.
(4) "Interest Period" means the period commencing on an Interest Payment
Date for the Notes (or commencing on the issue date for the Notes, if
no interest has been paid or duly made available for payment since
that date) and ending on the day before the next succeeding Interest
Payment Date for the Notes.
(5) "LIBOR" for any Interest Determination Date will be the offered rate
for deposits in U.S. dollars having an index maturity of three months
for a period commencing on the second London Business Day immediately
following the Interest Determination Date in amounts of not less than
$1,000,000, as such rate appears on Telerate Page 3750 at
approximately 11:00 a.m., London time, on the Interest Determination
Date (the "Reported Rate").
(6) "London Business Day" means a day on which dealings in deposits in
U.S. dollars are transacted, or with respect to any future date are
expected to be transacted, in the London interbank market.
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<PAGE>
(7) "Notes" shall have the meaning specified in Section 2.1 hereof.
(8) "Regular Record Date" means, for the interest payable on any Interest
Payment Date, the date which is fifteen calendar days immediately
prior to such Interest Payment Date (whether or not a Business Day).
(9) "Telerate Page 3750" means the display designated on page 3750 on Dow
Jones Markets Limited (or such other page as may replace the 3750 page
on that service or such other service as may be nominated by the
British Bankers' Association for the purpose of displaying London
interbank offered rates for U.S. dollar deposits or such other
successor reporter of such rates as may be selected by the Calculation
Agent and acceptable to the Corporation).
ARTICLE 2
THE SERIES OF SECURITIES
Section 2.1. Title of the Securities. There shall be a series of
Securities designated the "Floating Rate Notes due 2001" (the "Notes").
Section 2.2. Limitation on Aggregate Principal Amount; Date of Notes.
The aggregate principal amount of the Notes initially shall be limited to
$350,000,000. The Corporation may, without the consent of the Holders of the
Notes, issue additional notes having the same interest rate and other terms as
the Notes. Any additional notes will, together with the existing Notes,
constitute a single series of notes under the Indenture. No additional notes may
be issued if an Event of Default has occurred with respect to the existing
Notes. Each Note shall be dated the date of its authentication.
Section 2.3. Principal Payment Date. Subject to Section 2.4 hereof, the
principal amount of the Notes Outstanding (together with any accrued and unpaid
interest) shall be payable in a single installment on November 1, 2001.
Section 2.4. Interest and Interest Rates.
(A) Interest on the Notes shall be payable quarterly in
arrears, on the first day of each February, May, August and November
(each such date, an "Interest Payment Date"), commencing on February 1,
2001, until the principal hereof is paid or made available for payment.
Interest will accrue from the issue date of the Notes, and will be paid
to the Person in whose name such Note is registered in the Security
Register at the close of business on the Regular Record Date for such
interest installment. The interest so payable on any Note which is not
punctually paid or duly provided for on any Interest Payment Date shall
forthwith cease to be payable to the Holder on such Regular Record Date
and may either be paid to the Person in whose name such Note is
registered in the Security Register at the close of business on a date
("Special Record Date") for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to Holders of
the Notes not less than 10 days prior to such Special Record Date, or
be paid at any time in any other lawful manner not inconsistent with
the requirements of any securities exchange on which the Notes may be
listed, and upon such notice as may be required by such exchange, all
as more fully provided in said Indenture. If any scheduled Interest
Payment Date falls on a day that is not a Business Day, it will be
postponed to the following Business Day. If the maturity date of the
Notes falls on a day which is not a Business Day, the required payment
of principal and/or interest shall be made on the following Business
Day as if it were made on the date the payment was due. Interest will
not accrue as a result of this delayed payment.
3
<PAGE>
(B) The Notes will bear interest for each quarterly Interest
Period at an annual rate determined by the Calculation Agent, subject
to the maximum interest rate permitted by California or other
applicable state law, as such law may be modified by United States law
of general application. The interest rate applicable during each
quarterly Interest Period will be equal to LIBOR on the Interest
Determination Date for such Interest Period plus 0.50%; provided,
however, that under the limited circumstances described below in
Section 2.4(C), the interest rate will be determined without reference
to LIBOR. Promptly upon such determination, the Calculation Agent will
notify the Trustee, if the Trustee is not then serving as the
Calculation Agent, of the interest rate for the new Interest Period.
The interest rate determined by the Calculation Agent, absent manifest
error, shall be binding and conclusive upon the beneficial owners and
Holders of the Notes, the Corporation and the Trustee.
(C) If the following circumstances exist on any Interest
Determination Date, the Calculation Agent shall determine the interest
rate for the Notes as follows:
(1) In the event no Reported Rate appears on Telerate
Page 3750 as of approximately 11:00 a.m., London time, on an
Interest Determination Date, the Calculation Agent shall
request the principal London offices of each of four major
banks in the London interbank market selected by the
Calculation Agent (after consultation with the Corporation) to
provide a quotation of the rate (the "Rate Quotation") at
which three month deposits in amounts of not less than
$1,000,000 are offered by it to prime banks in the London
interbank market, as of approximately 11:00 a.m., London time,
on such Interest Determination Date, that are representative
of single transactions at such time (the "Representative
Amounts"). If at least two Rate Quotations are provided, the
interest rate will be the arithmetic mean of the Rate
Quotations obtained by the Calculation Agent, plus 0.50%.
(2) In the event no Reported Rate appears on Telerate
Page 3750 as of approximately 11:00 a.m., London time, on an
Interest Determination Date and there are fewer than two Rate
Quotations, the interest rate will be the arithmetic mean of
the rates quoted at approximately 11:00 a.m., New York City
time, on such Interest Determination Date, by three major
banks in New York City selected by the Calculation Agent
(after consultation with the Corporation), for loans in
Representative Amounts in U.S. dollars to leading European
banks, having a term of three months for a period commencing
on the second London Business Day immediately following such
Interest Determination Date, plus 0.50%; provided, however,
that if fewer than three banks selected by the Calculation
Agent are quoting such rates, the interest rate for the
applicable Interest Period will be the same as the interest
rate in effect for the immediately preceding Interest Period.
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<PAGE>
(D) Upon the request of a Holder of the Notes, the Calculation
Agent will provide to such Holder the interest rate in effect on the
date of such request and, if determined, the interest rate for the next
Interest Period.
(E) The amount of interest for each day that the Notes are
outstanding (the "Daily Interest Amount") will be calculated by
dividing the interest rate in effect for that day by 360 and
multiplying that result by the principal amount of the Notes. The
amount of interest to be paid on the Notes for each Interest Period
will calculated by adding the Daily Interest Amounts for each day in
the Interest Period. All dollar amounts resulting from such calculation
will be rounded, if necessary, to the nearest cent with one-half cent
rounded upward.
(F) The interest rate on the Notes will be subject to
adjustment until the maturity date. In the event of a downgrade in the
senior unsecured long-term debt rating of the Corporation (the
"Rating") below A3 by Moody's Investors Service, Inc. ("Moody's") or A-
by Standard & Poor's Rating Service ("S&P"), the interest rate on the
Notes will be adjusted in accordance with the table set forth below in
paragraph (J) of this Section.
(G) If, prior to the maturity of the Notes, either Moody's or
S&P changes the Rating subsequent to an adjustment in the interest rate
as a result of a previous Rating change by Moody's or S&P, the interest
rate on the Notes will be re-adjusted in accordance with the table set
forth in paragraph (J) below.
(H) The Notes will bear interest at an annual rate of LIBOR
plus 0.50% from the issue date of the Notes, until the first day of
the first Interest Period following a downgrade in the Rating below A3
by Moody's or A- by S&P. Under the limited circumstances described
under this Section 2.4, the interest rate will be determined without
reference to LIBOR.
(I) Beginning with the first day of the first Interest Period
after a Rating change, the Notes will bear interest at an adjusted
interest rate. Subsequent interest rate adjustments (whether the
adjustment is up or down) will also become effective on the first day
of the first Interest Period after such Rating change.
(J) The adjusted annual interest rate for the Notes will be
the sum of (1) LIBOR (calculated as provided in this Section 2.4), (2)
0.50% and (3) the sum of the Moody's and S&P adjustment amounts set
forth below. Under the limited circumstances described under this
Section 2.4, the interest rate will be determined without
reference to LIBOR.
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<PAGE>
<TABLE>
<CAPTION>
--------------------- ---------------------- ----------------- -------------------------
Moody's Adjustment S&P Adjustment
Moody's Rating Amount S&P Rating Amount
--------------------- ---------------------- ----------------- -------------------------
<S> <C> <C> <C>
A3 0.000% A- 0.000%
--------------------- ---------------------- ----------------- -------------------------
Baa1 0.125% BBB+ 0.125%
--------------------- ---------------------- ----------------- -------------------------
Baa2 0.250% BBB 0.250%
--------------------- ---------------------- ----------------- -------------------------
Baa3 0.375% BBB- 0.375%
--------------------- ---------------------- ----------------- -------------------------
Ba1 or lower 0.875% BB+ or lower 0.875%
--------------------- ---------------------- ----------------- -------------------------
</TABLE>
Section 2.5. Place of Payment. The Place of Payment where the Notes may
be presented or surrendered for payment, where the Notes may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Corporation in respect of the Notes and the Senior Indenture may be served
shall be the Corporate Trust Office of the Trustee.
Section 2.6. Exchange. At any time, the Corporation may cause the Notes
to be distributed to Holders of the Notes in definitive certificated form upon
prior notice to the Trustee.
Section 2.7. Denomination. The Notes shall be in registered form without
coupons and shall be issuable in denominations of $1000 and integral multiples
thereof.
Section 2.8. Currency. Principal and interest and other amounts payable
on the Notes shall be paid in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debt.
Section 2.9. Form of Notes. The Notes shall be issuable in whole in the
form of one or more Global Securities, and the Depository for such Global
Securities shall be Depository Trust Company, New York, New York. The Notes
shall be substantially in the form attached as Exhibit A hereto.
Section 2.10. Securities Registrar and Paying Agent; Unclaimed Amounts.
The Trustee shall initially serve as Security Registrar and Paying Agent. Any
amount paid to the Trustee or any Paying Agent, or held in trust by the
Corporation, for payments on any Note, that remains unclaimed at the end of two
years after such amount is due will be repaid to the Corporation.
Section 2.11. No Redemption. The Notes may not be redeemed at any time
prior to the principal payment date specified in Section 2.3 hereof.
Section 2.12. No Defeasance or Covenant Defeasance. The Notes shall not
be subject to Defeasance or Covenant Defeasance at the option of the Corporation
pursuant to Article XIII of the Senior Indenture.
Section 2.13. No Sinking Fund Obligations. The Corporation has no
obligation to redeem or purchase any Notes pursuant to any sinking fund or
analogous requirement or upon the happening of a specified event or at the
option of a Holder thereof.
6
<PAGE>
ARTICLE 3
MISCELLANEOUS PROVISIONS
Section 3.1. The Senior Indenture, as supplemented and amended by this
Supplemental Indenture No. 3, is in all respects hereby adopted, ratified and
confirmed.
Section 3.2. This Supplemental Indenture No. 3 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 3.3. Nothing in this Supplemental Indenture No. 3, express or
implied, shall give to any Person, other than the parties hereto and their
successors and assigns, and the Holders of the Notes, any benefit or legal or
equitable right, remedy or claim under this Supplemental Indenture No. 3 or the
Senior Indenture.
Section 3.4. THIS SUPPLEMENTAL INDENTURE NO. 3 AND EACH NOTE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
CALIFORNIA, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.
7
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture No. 3 to be duly executed, as of the day and year first written above.
EDISON INTERNATIONAL
By: -----------------------------
Name: Mary C. Simpson
Title: Assistant Treasurer
Attest:
-------------------------------------
THE BANK OF NEW YORK,
as Trustee
By:
-------------------------
Authorized Signatory
Attest:
-------------------------------------
<PAGE>
EXHIBIT A
[FORM OF FACE OF NOTE]
THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF.
THIS NOTE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A NOTE REGISTERED, AND NO
TRANSFER OF THIS NOTE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
EDISON INTERNATIONAL
Floating Rate Note due 2001
No. $
----
CUSIP No. 281 020 AE 7
Edison International, a corporation duly organized and existing under
the laws of the State of California (herein called the "Corporation," which term
includes any successor Person under the Indenture hereinafter referred to), for
value received, hereby promises to pay to ________________________or registered
assigns, the initial principal sum of _________________________________________
_______________________________________________ on November 1, 2001, and to pay
interest thereon from November 8, 2000, or from the most recent Interest Payment
Date to which interest has been paid or duly provided for, quarterly in arrears,
on the first day of each February, May, August and November (each such date, an
"Interest Payment Date"), commencing on February 1, 2001, until the principal
hereof is paid or made available for payment. Interest will accrue from the
issue date of November 8, 2000 and will be paid to the Person in whose name this
Note is registered in the Security Register at the close of business on the
Regular Record Date for such interest installment. The interest rate on the
Notes for each quarterly interest period will be reset quarterly based on the
three-month LIBOR rate plus 0.50%; provided, however, under limited
circumstances, the interest rate on the Notes for each quarterly interest period
will be determinted without reference to LIBOR. The interest so payable on any
Note which is not punctually paid or duly provided for on any Interest Payment
Date shall forthwith cease to be payable to the Holder on such Regular Record
Date and may either be paid to the Person in whose name such Note is registered
1
<PAGE>
in the Security Register at the close of business on a date ("Special Record
Date") for the payment of such Defaulted Interest to be fixed by the Trustee,
notice whereof shall be given to Holders of the Notes not less than 10 days
prior to such Special Record Date, or be paid at any time in any other lawful
manner not inconsistent with the requirements of any securities exchange on
which the Notes may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in said Indenture. If any scheduled
Interest Payment Date falls on a day that is not a Business Day, it will be
postponed to the following Business Day. If the maturity date of the Notes falls
on a day which is not a Business Day, the required payment of principal and/or
interest shall be made on the following Business Day as if it were made on the
date the payment was due. Additional interest will not accrue as a result of
this delayed payment.
Payment of the principal of and any such interest on this Note will be
made at the office or agency of the Trustee maintained for that purpose in
Chicago, Illinois, in such coin or currency of the United States of America as
at the time of payment is legal tender for payment of public and private debts;
provided, however, that at the option of the Corporation payment of interest may
be made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register or by wire transfer at such place
and to such account at a banking institution in the United States as may be
designated in writing to the Trustee at least sixteen (16) days prior to the
date for payment by the Person entitled thereto.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Note
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
2
<PAGE>
IN WITNESS WHEREOF, the Corporation has caused this instrument to be
duly executed under its corporate seal.
Dated as of Date of Authentication:
EDISON INTERNATIONAL
By
----------------------------------
Name:
Title:
Attest:
This is one of the Floating Rate Notes Due 2001 referred to in the
within-mentioned Indenture.
THE BANK OF NEW YORK,
as Trustee
By:
-------------------------------
Authorized Signatory
Dated: _________________
3
<PAGE>
[FORM OF REVERSE OF NOTE]
This Floating Rate Note due 2001 is one of a duly authorized issue of
securities of the Corporation (herein called the "Notes"), issued and to be
issued in one or more series under a Senior Indenture, dated as of September 28,
1999, (herein called the "Indenture," which term shall have the meaning assigned
to it in such instrument), between the Corporation and The Bank of New York, as
successor Trustee (herein called the "Trustee," which term includes any
successor trustee under the Indenture) to Harris Trust and Savings Bank, and
reference is hereby made to the Indenture for a statement of the respective
rights, limitation of rights, duties and immunities thereunder of the
Corporation, the Trustee and the Holders of the Notes and of the terms upon
which the Notes are, and are to be, authenticated and delivered. This Note is
one of the series designated on the face hereof, initially limited in aggregate
principal amount to $350,000,000.
The Notes will bear interest for each quarterly Interest Period (as
defined below) at an annual rate determined by the Calculation Agent (as defined
below), subject to the maximum interest rate permitted by California or other
applicable state law, as such law may be modified by United States law of
general application. The interest rate applicable during each quarterly Interest
Period will be equal to LIBOR (as defined below) on the Interest Determination
Date (as defined below) for such Interest Period plus 0.50%; provided, however,
that under the limited circumstances described below, the interest rate will be
determined without reference to LIBOR. Promptly upon such determination, the
Calculation Agent will notify the Trustee, if the Trustee is not then serving as
the Calculation Agent, of the interest rate for the new Interest Period. The
interest rate determined by the Calculation Agent, absent manifest error, shall
be binding and conclusive upon the beneficial owners and Holders of the Notes,
the Corporation and the Trustee.
If the following circumstances exist on any Interest Determination
Date, the Calculation Agent shall determine the interest rate for the Notes as
follows:
(1) In the event no Reported Rate (as defined below) appears
on Telerate Page 3750 (as defined below) as of approximately 11:00
a.m., London time, on an Interest Determination Date, the Calculation
Agent shall request the principal London offices of each of four major
banks in the London interbank market selected by the Calculation Agent
(after consultation with the Corporation) to provide a quotation of the
rate (the "Rate Quotation") at which three month deposits in amounts of
not less than $1,000,000 are offered by it to prime banks in the London
interbank market, as of approximately 11:00 a.m., London time, on such
Interest Determination Date, that are representative of single
transactions at such time (the "Representative Amounts"). If at least
two Rate Quotations are provided, the interest rate will be the
arithmetic mean of the Rate Quotations obtained by the Calculation
Agent, plus 0.50%.
(2) In the event no Reported Rate appears on Telerate Page
3750 as of approximately 11:00 a.m., London time, on an Interest
Determination Date and there are fewer than two Rate Quotations, the
interest rate will be the arithmetic mean of the rates quoted at
approximately 11:00 a.m., New York City time, on such Interest
Determination Date, by three major banks in New York City selected by
<PAGE>
the Calculation Agent (after consultation with the Corporation), for
loans in Representative Amounts in U.S. dollars to leading European
banks, having a term of three months for a period commencing on the
second London Business Day immediately following such Interest
Determination Date, plus 0.50%; provided, however, that if fewer than
three banks selected by the Calculation Agent are quoting such rates,
the interest rate for the applicable Interest Period will be the same
as the interest rate in effect for the immediately preceding Interest
Period.
Upon the request of a Holder of the Notes, the Calculation Agent will
provide to such Holder the interest rate in effect on the date of such request
and, if determined, the interest rate for the next Interest Period.
The amount of interest for each day that the Notes are outstanding (the
"Daily Interest Amount") will be calculated by dividing the interest rate in
effect for that day by 360 and multiplying that result by the principal amount
of the Notes. The amount of interest to be paid on the Notes for each Interest
Period will calculated by adding the Daily Interest Amounts for each day in the
Interest Period. All dollar amounts resulting from such calculation will be
rounded, if necessary, to the nearest cent with one-half cent rounded upward.
The interest rate on the Notes will be subject to adjustment until
November 1, 2001. In the event of a downgrade in the senior unsecured long-term
debt rating of the Corporation (the "Rating") below A3 by Moody's Investors
Service, Inc. ("Moody's") or A- by Standard & Poor's Rating Service ("S&P"), the
interest rate on the Notes will be adjusted in accordance with the table below.
If, prior to the maturity of the Notes, either Moody's or S&P changes
the Rating subsequent to an adjustment in the interest rate as a result of a
previous Rating change by Moody's or S&P, the interest rate on the Notes will be
re-adjusted in accordance with the table below.
The Notes will bear interest at an annual rate of LIBOR plus 0.50% from
November 8, 2000, until the first day of the first Interest Period following a
downgrade below A3 by Moody's or A- by S&P.
Beginning with the first day of the first Interest Period after a
Rating change, the Notes will bear interest at an adjusted interest rate.
Subsequent interest rate adjustments (whether the adjustment is up or down) will
also become effective on the first day of the first Interest Period after such
Rating change.
The adjusted annual interest rate for the Notes will be the sum of (1)
LIBOR, (2) 0.50% and (3) the sum of the Moody's and S&P adjustment amounts set
forth below.
<TABLE>
<CAPTION>
---------------------------- ------------------------------ ------------------------- ---------------------------
Moody's Adjustment S&P Adjustment
Moody's Rating Amount S&P Rating Amount
---------------------------- ------------------------------ ------------------------- ---------------------------
<S> <C> <C> <C> <C>
A3 0.000% A- 0.000%
---------------------------- ------------------------------ ------------------------- ---------------------------
Baa1 0.125% BBB+ 0.125%
---------------------------- ------------------------------ ------------------------- ---------------------------
Baa2 0.250% BBB 0.250%
---------------------------- ------------------------------ ------------------------- ---------------------------
Baa3 0.375% BBB- 0.375%
---------------------------- ------------------------------ ------------------------- ---------------------------
Ba1 or lower 0.875% BB+ or lower 0.875%
---------------------------- ------------------------------ ------------------------- ---------------------------
</TABLE>
Under the limited circumstances described above, the interest rate will
be determined without reference to LIBOR.
<PAGE>
The following definitions apply to this Note:
"Calculation Agent" means the Trustee, or its successor appointed by
the Corporation, acting as calculation agent.
"Interest Determination Date" means the second London Business Day
immediately preceding the first day of the relevant Interest Period.
"Interest Period" means the period commencing on an Interest Payment
Date for the Notes (or commencing on the issue date for the Notes, if no
interest has been paid or duly made available for payment since that date) and
ending on the day before the next succeeding Interest Payment Date for the
Notes.
"LIBOR" for any Interest Determination Date will be the offered rate
for deposits in U.S. dollars having an index maturity of three months for a
period commencing on the second London Business Day immediately following the
Interest Determination Date in amounts of not less than $1,000,000, as such rate
appears on Telerate Page 3750 at approximately 11:00 a.m., London time, on the
Interest Determination Date (the "Reported Rate").
"London Business Day" means a day on which dealings in deposits in U.S.
dollars are transacted, or with respect to any future date are expected to be
transacted, in the London interbank market.
"Regular Record Date" means, for the interest payable on any Interest
Payment Date, the date which is fifteen calendar days immediately prior to such
Interest Payment Date (whether or not a Business Day).
"Telerate Page 3750" means the display designated on page 3750 on Dow
Jones Markets Limited (or such other page as may replace the 3750 page on that
service or such other service as may be nominated by the British Bankers'
Association for the purpose of displaying London interbank offered rates for
U.S. dollar deposits or such other successor reporter of such rates as may be
selected by the Calculation Agent and acceptable to the Corporation).
The Notes will not be entitled to the benefits of any sinking fund. The
Notes are not subject to redemption, Defeasance or Covenant Defeasance at the
option of the Corporation.
If an Event of Default with respect to the Notes shall occur and be
continuing, the principal of the Notes may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Corporation may, without the consent of the Holders of the Notes,
issue additional notes having the same interest rates and other terms as the
Notes. Any additional notes will, together with the existing Notes, constitute a
single series of notes under the Indenture. No additional notes may be issued if
any Event of Default has occurred with respect to the existing Notes. The
Indenture permits, with certain exceptions as therein provided, the amendment
thereof and the modification of the rights and obligations of the Corporation
and the rights of the Holders of the Securities of all series affected under the
Indenture at any time by the Corporation and the Trustee with the consent of the
Holders of a majority in principal amount of the Securities of all series at the
time Outstanding affected thereby (voting as one class). The Indenture contains
provisions permitting the Holders of not less than a majority in principal
amount of the Securities of all series at the time Outstanding with respect to
which a default under the Indenture shall have occurred and be continuing
(voting as one class), on behalf of the Holders of the Securities of all such
series, to waive, with certain exceptions, such past default with respect to all
such series and its consequences. The Indenture also permits the Holders of not
less than a majority in principal amount of the Securities of each series at the
time Outstanding, on behalf of the Holders of all Securities of such series, to
waive compliance by the Corporation with certain provisions of the Indenture.
Any such consent or waiver by the Holder of this Note shall be conclusive and
binding upon such Holder and upon all future Holders of this Note and of any
Note issued upon the registration of transfer hereof or in exchange therefor or
in lieu hereof, whether or not notation of such consent or waiver is made upon
this Note.
<PAGE>
As provided in and subject to the provisions of the Indenture, the
Holder of this Note shall not have the right to institute any proceeding with
respect to the Indenture or for the appointment of a receiver or trustee or for
any other remedy thereunder unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Notes, the Holders of not less than 25% in principal amount of the Notes at the
time Outstanding shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default as Trustee and offered the
Trustee reasonable indemnity, and the Trustee shall not have received from the
Holders of a majority in principal amount of the Notes at the time Outstanding a
direction inconsistent with such request, and shall have failed to institute any
such proceeding, for 60 days after receipt of such notice, request and offer of
indemnity. The foregoing shall not apply to any suit instituted by the Holder of
this Note for the enforcement of any payment of principal hereof or any premium
or interest hereon on or after the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Corporation, which
is absolute and unconditional, to pay the principal of and any premium and
interest on this Note at the times, place and rate, and in the coin or currency,
herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note is registrable in the Security Register,
upon surrender of this Note for registration of transfer at the office or agency
of the Security Registrar in any place where the principal of and any premium
and interest on this Note are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Corporation and the
Security Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Notes and of like tenor, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Notes are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth, the Notes are
exchangeable for a like aggregate principal amount of the Notes and of like
tenor of a different authorized denomination, as requested by the Holder
surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Corporation may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of transfer, the
Corporation, the Trustee and any agent of the Corporation or the Trustee may
treat the Person in whose name this Note is registered as the owner hereof for
all purposes, whether or not this Note be overdue, and neither the Corporation,
the Trustee nor any such agent shall be affected by notice to the contrary.
All terms used in this Note which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
The Indenture and the Notes issued thereby shall be governed by and
construed in accordance with the laws of the State of California.
