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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 23, 1997
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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POTASH CORPORATION OF SASKATCHEWAN INC.
(Exact name of the registrant as specified in its charter)
<TABLE>
<S> <C>
Saskatchewan N/A
(State or other jurisdiction (I.R.S. Employer
or incorporation or organization) Identification Number)
</TABLE>
122 -- 1(st) Avenue South
Saskatoon, Saskatchewan, Canada S7K 7G3
306-933-8500
(Address and telephone number of the registrant's principal executive offices)
Charles E. Childers
Potash Corporation of Saskatchewan Inc.
122 -- 1(st) Avenue South
Saskatoon, Saskatchewan, Canada S7K 7G3
306-933-8500
(Name, address and telephone number of agent for service)
The Commission is requested to send copies of all communications to:
James B. Halpern
Arent Fox Kintner Plotkin & Kahn
1050 Connecticut Avenue, N.W.
Washington, D.C. 20036-5339
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Approximate date of commencement of proposed sale of the securities to the
public: From time to time after the effective date of this Registration
Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
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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. [ ]
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If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
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<CAPTION>
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PROPOSED
MAXIMUM PROPOSED
OFFERING MAXIMUM
AMOUNT PRICE AGGREGATE AMOUNT OF
TITLE OF EACH CLASS OF TO BE PER OFFERING REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED UNIT* PRICE* FEE
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<S> <C> <C> <C> <C>
Debt Securities......................... $1,000,000,000 100% $1,000,000,000 $ 303,030.30
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</TABLE>
* Estimated solely for the purpose of determining the registration fee.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
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POTASH CORPORATION OF SASKATCHEWAN INC.
DEBT SECURITIES
Potash Corporation of Saskatchewan Inc. ("PCS") may from time to time offer
its debt securities ("Securities") up to an aggregate initial offering price not
to exceed the equivalent of $1,000,000,000, in separate series, in amounts and
at prices and on terms determined by market conditions at the time of the sale.
The Securities may be denominated in U.S. dollars or in any other currency,
currency units or composite currencies as may be designated by PCS.
The designation, aggregate principal amount, maturity date, public offering
price, interest rate or rates (which may be fixed or variable) or the method by
which such rate or rates are determined and timing of payments of interest, if
any, provision for redemption, sinking fund requirements, if any, any other
variable terms and the method of distribution in connection with the offering of
Securities in respect of which this Prospectus is being delivered, will be set
forth in a Prospectus Supplement relating thereto. The Prospectus Supplement
will contain information, where applicable, relating to certain U.S. and
Canadian federal income taxes relating to, and any listing on a securities
exchange of, the Securities covered by such Prospectus Supplement.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED ON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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PCS may sell Securities to or through underwriters or groups of
underwriters or dealers, and also may sell Securities to one or more other
purchasers, directly or through agents. See "Plan of Distribution." The
Prospectus Supplement will set forth the names of any underwriters, dealers or
agents involved in the sale of any Securities offered thereunder, the principal
amounts, if any, to be purchased by underwriters and the compensation of such
underwriters, dealers or agents.
THE DATE OF THIS PROSPECTUS IS MAY , 1997.
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AVAILABLE INFORMATION
PCS is subject to the information 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 may be inspected and copied at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549, and at the Commission's Regional Offices at 7 World Trade Center,
13th Floor, New York, New York 10048, and at Citicorp Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661. Copies of such materials may be
obtained at the prescribed rates from the Public Reference Section of the
Commission at its principal office in Washington, D.C. The Commission maintains
a site on the World Wide Web that contains documents filed electronically with
the Commission. The address of the Commission's web site is http://www.sec.gov,
and the materials filed electronically by PCS may be inspected at such site. In
addition, the materials filed by PCS at the New York Stock Exchange may be
inspected at the Exchange's offices, 20 Broad Street, New York, New York 10005.
PCS has filed a Registration Statement on Form S-3 with the Commission
under the Securities Act of 1933, as amended (the "Securities Act"), concerning
the Securities. This Prospectus, which constitutes a part of the Registration
Statement, omits certain of the information contained in the Registration
Statement and the exhibits thereto. Statements contained in this Prospectus, or
in any document incorporated by reference herein, as to the contents of any
document are summaries of such documents and 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 such other document, each such
statement being hereby qualified in all respects by such reference. The
Registration Statement, including the exhibits thereto, is on file at the
offices of the Commission and may be inspected and copied as described above.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
PCS incorporates by reference herein the following documents, which have
been filed with the Commission pursuant to the Exchange Act (File No. 1-10351):
(a) PCS's Annual Report on Form 10-K for the year ended December 31,
1996;
(b) PCS's Current Report on Form 8-K, dated March 20, 1997, as amended
by the Current Report on Form 8-KA dated May 15, 1997, for the event dated
March 6, 1997; and
(c) PCS's Quarterly Report on Form 10-Q for the three months ended
March 31, 1997.
All documents and reports filed by PCS pursuant to Section 13(a), 13(c), 14
or 15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of this offering shall be deemed to be incorporated by reference in
this Prospectus and to be a part hereof from the dates of filing of such
documents or reports.
Any statement contained herein or in a document incorporated by reference
herein shall be deemed to be modified or superseded for purposes of the
Registration Statement and this Prospectus to the extent that a statement
contained herein or in any subsequently filed document which also is
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of the Registration Statement or this
Prospectus.
This Prospectus incorporates documents by reference which are not presented
herein or delivered herewith. Such documents (other than exhibits to such
documents, unless such exhibits are specifically incorporated by reference) are
available, without charge, to any person to whom this Prospectus is delivered,
upon written or oral request to Potash Corporation of Saskatchewan Inc., Suite
500, 122-1st Avenue South, Saskatoon, Saskatchewan, Canada S7K 7G3, telephone
(306) 933-8500 (Attention: Corporate Secretary).
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ENFORCEABILITY OF CIVIL LIABILITIES UNDER
UNITED STATES FEDERAL SECURITIES LAWS
PCS is a corporation organized under the laws of the Province of
Saskatchewan, Canada. Certain of the directors and executive officers of PCS are
residents of Canada, and certain of the experts named in this Prospectus are
residents of Canada. Substantial portions of the assets of PCS and its direct
and indirect subsidiaries and such individuals and experts are located outside
of the United States. As a result, it may be difficult or impossible for persons
who purchase the Securities to effect service of process upon such persons
within the United States in connection with matters arising under the United
States federal securities laws or to enforce against them in United States
courts judgments of United States courts predicated upon the civil liability
provisions of the United States federal securities laws. There is some doubt as
to the enforceability in Canada in original actions, or in actions for
enforcement of judgments of United States courts, of civil liabilities
predicated upon the United States federal securities laws. In addition, awards
for punitive damages in actions brought in the United States or elsewhere may be
unenforceable in Canada.
FINANCIAL STATEMENT PRESENTATION
Although PCS presents its financial statements in United States dollars,
its financial statements and financial data derived therefrom presented in this
Prospectus and in the documents incorporated by reference herein (other than pro
forma information) have been prepared in accordance with generally accepted
accounting principles in Canada ("GAAP"), and thus may not be comparable to
financial statements of United States companies. For a reconciliation of GAAP to
generally accepted accounting principles in the United States as applied to the
consolidated financial statements of PCS for the three years ended December 31,
1996 (the "Consolidated Financial Statements"), see Note 25 to the Consolidated
Financial Statements which are incorporated by reference herein.
THE COMPANY
The Company is one of the world's largest integrated fertilizer companies
with significant market share in each of the three primary fertilizer
products -- potash, phosphate and nitrogen. In 1996, PCS's potash production
represented 15% of global production, 23% of global potash capacity and an
estimated 41% of global potash excess capacity. The Company is the third largest
producer of phosphates worldwide by capacity, currently representing
approximately 9% of world production and 7% of world capacity. The Company
believes its potash and phosphate reserves to be the largest in North America.
On March 6, 1997, the Company acquired all of the outstanding capital stock
of Arcadian Corporation in exchange for cash of $555 million and 8,030,236
common shares of PCS. Since acquiring Arcadian Corporation, the Company has
become the largest producer and marketer of nitrogen fertilizer and chemical
products in the Western hemisphere. Arcadian Corporation now operates under the
name PCS Nitrogen, Inc. In 1996, sales of Arcadian Corporation were divided
approximately 60% to agricultural customers and 40% to industrial customers.
The Company's products are used for agricultural and industrial purposes as
well as for food ingredients. The Company produces and sells potash, solid
phosphate fertilizers (principally diammonium phosphate ("DAP")), liquid
phosphate fertilizers, phosphate feed supplements, purified phosphoric acid,
ammonia, urea, ammonium nitrate, nitric acid and nitrogen solutions. The Company
produces potash from six mines in Saskatchewan (five of which it owns and
operates), one in New Brunswick and one in Utah. The Company operates the
world's largest vertically integrated phosphate mine and processing plant, which
is located in North Carolina, a phosphate mine and two chemical plant complexes
in northern Florida and seven phosphate feed plants in the United States. In
addition, the Company manufactures, processes and distributes fertilizer and
other agricultural supplies from plants located in Florida, Georgia and Alabama.
As a result of the acquisition of Arcadian Corporation, the Company acquired
eight sites dedicated to the production of nitrogen-related products, one of
which also produces phosphate-related products.
The mailing address of the Company's principal executive offices is Suite
500, 122-1st Avenue South, Saskatoon, Saskatchewan, Canada S7K 7G3, and its
telephone number is (306) 933-8500. In this Prospectus, the "Company" means
Potash Corporation of Saskatchewan Inc., its predecessors and its direct and
indirect subsidiaries, unless the context otherwise indicates.
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FINANCIAL INFORMATION
The following sets forth selected historical and pro forma consolidated
financial information of PCS for the periods indicated. The summary historical
consolidated financial information is presented in accordance with GAAP and
should be read in conjunction with the Consolidated Financial Statements and the
unaudited consolidated interim financial statements for each of the three month
periods ended March 31, 1996 and 1997, incorporated by reference herein. For a
discussion of the principal differences between GAAP and U.S. generally accepted
accounting principles, see Note 25 to the Consolidated Financial Statements. The
historical consolidated financial information for each of the years in the
five-year period ended December 31, 1996 are derived from consolidated financial
statements of PCS audited by Deloitte & Touche. The historical consolidated
financial information for each of the three month periods ended March 31, 1996
and 1997 are derived from the unaudited consolidated interim financial
statements of PCS incorporated by reference herein. The three month results are
not necessarily indicative of the results that may be expected for any other
period or a full year. The pro forma income statement data for the year ended
December 31, 1996 gives effect to the acquisition of Arcadian Corporation (the
"Arcadian Acquisition") as if it had occurred at the beginning of such period.
The pro forma financial position data at December 31, 1996 gives effect to the
Arcadian Acquisition as if it had occurred on that date. The pro forma financial
information does not purport to be indicative of PCS's financial position or
results of operations that would actually have been obtained if the Arcadian
Acquisition had been completed on such date or to project PCS's financial
position or results of operations at any future date or for any future period.
<TABLE>
<CAPTION>
THREE
MONTHS ENDED
MARCH 31, YEAR ENDED DECEMBER 31,
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PRO FORMA
1997(1) 1996 1996 1996 1995(2) 1994 1993 1992
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(IN THOUSANDS OF DOLLARS, EXCEPT PRODUCTION DATA, PER SHARE DATA AND RATIOS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Net sales.......................... 464,834 366,871 2,604,608 1,403,868 856,080 363,117 212,193 214,083
Operating income................... 90,513 87,122 580,672 299,492 224,249 98,475 56,869 50,587
Net income......................... 56,365 63,678 353,687 209,036 159,486 91,219 44,697 39,875
Net income per share............... 1.18 1.40 6.60 4.59 3.68 2.12 1.13 1.03
FINANCIAL POSITION DATA (AT END OF
PERIOD):
Working capital.................... 334,974 210,919 278,801 136,078 103,281 36,985 70,912
Total assets....................... 4,446,617 2,525,099 2,494,387 2,581,817 1,027,766 1,036,490 915,049
Long-term debt..................... 1,365,791 714,417 619,963 714,498 2,000 20,128 48,900
Shareholders' equity............... 2,021,247 1,295,573 1,405,496 1,241,875 964,334 903,719 809,460
OTHER FINANCIAL DATA:
Operating cash flow................ 82,565 68,644 296,186 233,483 150,705 49,773 57,416
Capital expenditures............... 25,282 8,384 58,939 39,596 16,751 15,796 9,872
Ratio of earnings to fixed
charges(3)....................... 5.36 5.51 5.04 5.48 4.67 14.20 5.03 4.54
</TABLE>
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Notes:
(1) The Company acquired Arcadian Corporation on March 6, 1997.
(2) The Company acquired Texasgulf Inc. in April 1995 and White Springs
Agricultural Chemicals, Inc. in October 1995.
(3) For the purpose of computing the ratio of earnings to fixed charges (a)
earnings have been calculated by adding income taxes and fixed charges to
net income, and (b) fixed charges consist of the total of interest charges
and a portion of rentals determined to be representative of the interest
factor.
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USE OF PROCEEDS
Except as otherwise provided in an applicable Prospectus Supplement, the
net proceeds from the sale of the Securities will be added to PCS's funds to be
used for general corporate purposes, including working capital, capital
expenditures and the repayment of debt outstanding from time to time. Pending
such application, such net proceeds may be invested in short-term marketable
securities. Specific information about the use of proceeds from the sale of
Securities will be set forth in the applicable Prospectus Supplement. PCS may
from time to time incur additional indebtedness other than through the offering
of Securities pursuant to this Prospectus.
DESCRIPTION OF SECURITIES
The Securities will be issued under an indenture (the "Indenture") between
PCS and The Bank of Nova Scotia Trust Company of New York, as trustee (the
"Indenture Trustee"). A form of the Indenture has been filed as an exhibit to
the Registration Statement of which this Prospectus is a part and is available
for inspection at the corporate trust office of the Indenture Trustee at One
Liberty Plaza, New York, N.Y. 10006. The Indenture will be subject to and
governed by the Trust Indenture Act of 1939, as amended. The statements made
under this heading relating to the Securities and the Indenture are summaries of
the provisions thereof and do not purport to be complete and are qualified in
their entirety by reference to the Indenture and the Securities. All Section
references herein are to Sections of the Indenture, which are incorporated
herein by reference. Capitalized terms used but not defined have the respective
meanings set forth in the Indenture.
GENERAL
The Securities will be direct unsecured obligations of PCS and will rank
equally with all other unsecured and unsubordinated indebtedness of PCS. The
Securities may be issued in one or more series, in each case as established from
time to time by PCS or as established in the Indenture or in one or more
indentures supplemental to the Indenture. All Securities of one series need not
be issued at the same time and, unless otherwise provided, a series may be
reopened, without the consent of the holders of the Securities of such series,
for issuance of additional Securities of such series (Section 301).
The Indenture provides that there may be more than one Indenture Trustee
thereunder, each with respect to one or more series of Securities. Any Indenture
Trustee under the Indenture may resign or be removed with respect to one or more
series of Securities, and a successor Indenture Trustee may be appointed to act
with respect to such series (Section 608). If two or more persons are acting as
Indenture Trustee with respect to different series of Securities, each such
Indenture Trustee will be an Indenture Trustee of a trust under the Indenture
separate and apart from the trust administered by any other Indenture Trustee
(Section 609). In general, any action to be taken by an Indenture Trustee may be
taken by each such Indenture Trustee with respect to, and only with respect to,
the one or more series of Securities for which it is Indenture Trustee under the
Indenture.
The Prospectus Supplement relating to the series of Securities being
offered will contain the specific terms thereof, including:
(a) The designation of such Securities.
(b) The aggregate principal amount of such Securities.
(c) The percentage of the principal amount at which such Securities
will be issued and, if other than the principal amount thereof, the portion
of the principal amount thereof payable upon declaration of acceleration of
the maturity thereof, or the method by which any such portion will be
determined.
(d) The date or dates, or the method for determining such date or
dates, on which the principal of such Securities will be payable;
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(e) The rate or rates (which may be fixed or variable), or the method
by which such rate or rates will be determined, at which such Securities
will bear interest.
(f) The date or dates, or the method for determining such date or
dates, from which any such interest will accrue, the dates on which any
such interest will be payable, the record dates for such interest payment
dates, or the method by which such dates will be determined, the persons to
whom such interest will be payable, and the basis upon which interest will
be calculated if other than that of a 360-day year of twelve 30-day months.
(g) The place or places where the principal of (and premium, if any)
and interest on such Securities will be payable, where such Securities may
be surrendered for registration of transfer or exchange and where notices
or demands to or upon PCS in respect of such Securities and the Indenture
may be served.
(h) The period or periods within which, the price or prices at which
and the other terms and conditions upon which such Securities may be
redeemed, as a whole or in part, at the option of PCS, if PCS is to have
such an option.
(i) The obligation, if any, of PCS to redeem, repay or purchase such
Securities pursuant to any sinking fund or analogous provision or at the
option of a holder thereof, and the period or periods within which, the
price or prices at which and the other terms and conditions upon which such
Securities will be redeemed, repaid or purchased, as a whole or in part,
pursuant to such obligation.
(j) If other than U.S. dollars, the currency or currencies in which
such Securities are denominated and payable, which may be another currency
or units of two or more other currencies or a composite currency or
currencies, and the terms and conditions relating thereto.
(k) Whether the amount of payments of principal of (and premium, if
any) or interest on such Securities may be determined with reference to an
index, formula or other method (which index, formula or method may, but
need not, be based on a currency, currencies, currency unit or units or
composite currency or currencies) and the manner in which such amounts will
be determined.
(l) The Events of Default or covenants of such Securities, to the
extent different from those described herein.
(m) Whether such Securities will be issued in certificated or
book-entry form.
(n) Whether such Securities will be in registered or bearer form and,
if in registered form, the denominations thereof if other than $1,000 and
any integral multiple thereof and, if in bearer form, the denominations
thereof and terms and conditions relating thereto.
(o) The applicability, if any, of the defeasance and covenant
defeasance provisions described herein, or any modification thereof.
(p) Whether and under what circumstances PCS will pay any additional
amounts on such Securities in respect of any tax, assessment or
governmental charge and, if so, whether PCS will have the option to redeem
such Securities in lieu of making such payment.
(q) Any other terms, conditions, rights and preferences of such
Securities (Section 301).
The Securities may provide for less than the entire principal amount
thereof to be payable upon declaration of acceleration of the maturity thereof
("Original Issue Discount Securities"). Special U.S. federal income tax,
accounting and other considerations applicable to Original Issue Discount
Securities will be described in the applicable Prospectus Supplement.
The Prospectus Supplement for each offering of Securities may add to or
change statements contained in this Prospectus. Except as may be set forth in
any Prospectus Supplement, the Securities will not contain any provisions that
would limit the ability of PCS to incur unsecured indebtedness or that would
afford holders of Securities protection in the event of a highly leveraged or
similar transaction involving PCS or in the event of a change of control.
Reference is made to the applicable Prospectus Supplement for information with
respect to
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any deletions from, modifications of or additions to the Events of Default or
covenants of PCS that are described below, including any addition of a covenant
or other provision providing event risk or similar protection.
DENOMINATION, INTEREST, REGISTRATION OR TRANSFER
Unless specified in the applicable Prospectus Supplement, the Securities of
any series will be issuable in denominations of $1,000 and integral multiples
thereof (Section 302).
The principal of (and applicable premium, if any) and interest on any
series of Securities will be payable at the corporate trust office of the
Indenture Trustee, which initially will be One Liberty Plaza, New York, New York
10006; provided that, at the option of PCS, payment of interest may be made by
check mailed to the address of the Person entitled thereto as it appears in the
applicable register for such Securities or by wire transfer of funds to such
Person at an account maintained within the United States (Sections 301, 307 and
1002).
Any interest not punctually paid or duly provided for on any interest
payment date with respect to a Security ("Defaulted Interest") will forthwith
cease to be payable to the holder on the applicable Regular Record Date and may
either be paid to the Person in whose name such Security is registered at the
close of business on a special record date (the "Special Record Date") for the
payment of such Defaulted Interest to be fixed by the Indenture Trustee, notice
whereof will be given to the holder of such Security not less than 10 days prior
to such Special Record Date, or may be paid at any time in any other lawful
manner, all as more completely described in the Indenture (Section 307).
Subject to certain limitations imposed upon Securities issued in book-entry
form, the Securities of any series will be exchangeable for other Securities of
the same series and of a like aggregate principal amount and tenor of different
authorized denominations upon surrender of such Securities at the corporate
office of the Indenture Trustee. In addition, subject to certain limitations
imposed upon Securities issued in book-entry form, the Securities of any series
may be surrendered for registration of transfer or exchange thereof at the
corporate trust office of the Indenture Trustee. Every Security surrendered for
registration of transfer or exchange must be duly endorsed or accompanied by a
written instrument of transfer. No service charge will be made for any
registration of transfer or exchange of any Securities, but PCS may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith (Section 305). If the applicable Prospectus
Supplement refers to any transfer agent (in addition to the Indenture Trustee)
initially designated by PCS with respect to any series of Securities, PCS may at
any time rescind the designation of any such transfer agent or approve a change
in the location through which any such transfer agent acts, except that PCS will
be required to maintain a transfer agent in each place of payment for such
series. PCS may at any time designate additional transfer agents with respect to
any series of Securities (Section 1002).
Neither PCS nor the Indenture Trustee will be required to (a) issue,
register the transfer of or exchange Securities of any series during a period
beginning at the opening of business 15 days before any selection of Securities
of that series to be redeemed and ending at the close of business on the day of
mailing of the relevant notice of redemption, (b) register the transfer of or
exchange any Security, or portion thereof, called for redemption, except the
unredeemed portion of any Security being redeemed in part, or (c) issue,
register the transfer of or exchange any Security that has been surrendered for
repayment at the option of the holder, except the portion, if any, of such
Security not to be so repaid (Section 305).
MERGER, CONSOLIDATION OR SALE
PCS will be permitted to amalgamate or consolidate with, or sell, lease or
convey all or substantially all of its assets to, or merge with or into, any
other entity, provided that (a) either PCS will be the continuing entity, or the
successor entity (if other than PCS) formed by or resulting from any such
amalgamation, consolidation or merger or which will have received the transfer
of such assets is an entity organized and existing under the laws of the United
States or any state thereof or the District of Columbia or Canada or any
province thereof and will expressly assume payment of the principal of (and
premium, if any) and interest on all of the Securities and the due and punctual
performance and observance of all of the covenants and conditions
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contained in the Indenture; (b) immediately after giving effect to such
transaction, no Event of Default under the Indenture, and no event which, after
notice or the lapse of time, or both, would become such an Event of Default,
will have occurred and be continuing; and (c) an officer's certificate and legal
opinion covering such conditions will be delivered to the Indenture Trustee
(Sections 801 and 804).
CERTAIN COVENANTS
Additional Amounts. Payments made by PCS under or with respect to the
Securities will be free and clear of and without withholding or deduction for or
on account of any present or future tax, duty, levy, impost, assessment or other
governmental charge of any nature whatsoever imposed or levied by or on behalf
of the Government of Canada or of any province or territory thereof or by any
authority or agency therein or thereof having power to tax ("Taxes"), unless PCS
is required to withhold or deduct Taxes by law or by the interpretation or
administration thereof. If PCS is so required to withhold or deduct any amount
for or on account of Taxes from any payment made under or with respect to the
Securities, PCS will pay such additional interest ("Additional Amounts") as may
be necessary so that the net amount received by each Holder (including
Additional Amounts) after such withholding or deduction will not be less than
the amount the Holder would have received if such Taxes had not been withheld or
deducted; provided that no Additional Amounts will be payable with respect to a
payment made to a Holder (such Holder, an "Excluded Holder") (a) with which PCS
does not deal at arm's length (within the meaning of the Income Tax Act
(Canada)) at the time of making such payment, or (b) which is subject to such
Taxes by reason of its being connected with Canada or any province or any
territory thereof otherwise than by the mere holding of Securities or the
receipt of payments thereunder. PCS will also (a) make such withholding or
deduction and (b) remit the full amount deducted or withheld to the relevant
authority in accordance with applicable law. PCS will furnish to the Holders of
the Securities, within 30 days after the date the payment of any Taxes is due
pursuant to applicable law, certified copies of tax receipts evidencing such
payment by PCS. PCS will indemnify and hold harmless each Holder (other than an
Excluded Holder) and upon written request reimburse each such Holder for the
amount of (a) any Taxes so levied or imposed and paid by such Holder as a result
of payments made under or with respect to the Securities, (b) any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto, and (c) any Taxes imposed with respect to any reimbursement under (a)
or (b) in this sentence, but excluding any such Taxes on such Holder's net
income.
At least 30 days prior to each date on which any payment under or with
respect to the Securities is due and payable, if PCS will be obligated to pay
Additional Amounts with respect to such payment, PCS will deliver to the Trustee
an Officer's Certificate stating the fact that such Additional Amounts will be
payable, the amounts so payable and such other information necessary to enable
the Trustee to pay such Additional Amounts to Holders on the payment date.
Wherever in this Prospectus or a Prospectus Supplement there is mentioned the
payment of the principal of (or premium, if any) or interest on, or in respect
of, any Security of any series or payment of any related coupon or the net
proceeds received on the sale or exchange of any Security of any series, the
payment of principal (and premium, if any), interest or any other amount payable
under or with respect to a Security, such mention shall be deemed to include
mention of the payment of Additional Amounts to the extent that, in such
context, Additional Amounts are, were or would be payable in respect thereof.
The obligations of PCS to pay Additional Amounts if and when due will
survive the termination of the Indenture and the payment of all amounts under or
with respect to the Securities (Section 1009).
Limitation on Liens. PCS may not, and may not permit any Subsidiary of PCS
to, incur any Lien on or with respect to any of the Principal Property of PCS or
any such Subsidiary owned on or acquired after the date of the Indenture to
secure Debt without making, or causing such Subsidiary to make, effective
provision for securing the Securities equally and ratably with such Debt or, in
the event such Debt is subordinate in right of payment to the Securities, prior
to such Debt, as to such Principal Property for so long as such Debt will be so
secured. The foregoing restrictions will not apply to Liens in respect of Debt
existing on the date of the Indenture, to Liens on or with respect to property
that is not Principal Property, or to (a) Liens securing only Securities; (b)
Liens in favor of PCS or any of its Subsidiaries; (c) Liens on property existing
immediately prior to the time of acquisition thereof (and not created in
anticipation of the financing of such acquisition);
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(d) Liens to secure Debt incurred for the purpose of financing all or any part
of the purchase price or the cost of construction or improvement of property
used in the business of PCS or any of its Subsidiaries and subject to such
Liens, provided that (i) the principal amount of any Debt secured by such a Lien
does not exceed 100% of such purchase price or cost, (ii) such Lien does not
extend to or cover any other property other than such property and any such
improvements, and (iii) such Debt is incurred within 270 days of such purchase,
construction or improvement; (e) Liens on property of a Person existing at the
time such Person is merged with or into or amalgamated or consolidated with PCS
or any of its Subsidiaries that were not created in anticipation of the
acquisition of such Person, provided that such Lien does not extend to or cover
any property other than that of the Person so merged, amalgamated or
consolidated; (f) Liens on any Principal Property in favor of a governmental
body to secure partial progress, advance or other payments pursuant to any
contract or statute of such governmental body; and (g) Liens to secure Debt
incurred to extend, renew, refinance, replace or refund (or successive
extensions, renewals, refinancings, replacements or refundings), in whole or in
part, (i) any secured Debt existing on the date of this Indenture, or (ii) any
Debt secured by any Lien referred to in the foregoing clauses, so long as in
each such case the Lien does not extend to any other property and the Debt so
secured is not increased other than for reasonable costs related to such
extension, renewal, refinancing, replacement or refunding.
In addition to the foregoing, PCS and its Subsidiaries may incur a Lien or
Liens to secure Debt (excluding Debt secured by Liens permitted under the
foregoing exceptions) the aggregate amount of which, including Attributable Debt
in respect of Sale and Leaseback Transactions, does not exceed 10% of
Consolidated Net Tangible Assets. PCS and its Subsidiaries may also incur a Lien
or Liens to secure any Debt incurred pursuant to a Sale and Leaseback
Transaction, without securing the Securities equally and ratably with or prior
to such Debt, as applicable, provided that such Sale and Leaseback Transaction
is permitted by the provisions of the Indenture described below in clauses (b)
and (c) under "-- Limitation on Sale and Leaseback Transactions" (Section 1010).
Limitation on Sale and Leaseback Transactions. PCS may not, and may not
permit any Subsidiary of PCS to, enter into any Sale and Leaseback Transaction
with respect to any Principal Property (except for a period, including renewals,
not exceeding 36 months) unless (a) at the time of entering into such Sale and
Leaseback Transaction, PCS or such Subsidiary would be entitled to incur Debt,
in a principal amount equal to the Attributable Debt in respect of such Sale and
Leaseback Transaction, secured by a Lien, without equally and ratably securing
the Securities; (b) PCS or such Subsidiary applies, within 12 months after the
sale or transfer, an amount equal to the greater of (i) the net proceeds of the
Principal Property sold pursuant to the Sale and Leaseback Transaction, or (ii)
the fair value (in the opinion of an executive officer of PCS) of such Principal
Property to the acquisition of or construction on property used or to be used in
the ordinary course of business of PCS or a Subsidiary of PCS, and PCS shall
have elected to designate such amount as a credit against such Sale and
Leaseback Transaction; or (c) PCS or such Subsidiary applies, within 12 months
after the sale or transfer, an amount equal to the net proceeds of the Principal
Property sold pursuant to the Sale and Leaseback Transaction to the voluntary
defeasance or retirement of Debt, which amount will not be less than the fair
value (in the opinion of an executive officer of PCS) of such Principal Property
less an amount equal to the principal amount of such Debt voluntarily defeased
or retired by PCS or such Subsidiary within such 12 month period and not
designated as a credit against any other Sale and Leaseback Transaction (Section
1011).
Notwithstanding the foregoing, in no event shall PCS be required to defease
or retire, in the aggregate with respect to any and all such transactions, more
than 25% of the original aggregate principal amount of a series of the
Securities on or prior to the fifth anniversary of the Issue Date thereof. If
the aggregate net proceeds that would be otherwise required to defease or retire
Securities on or prior to the fifth anniversary of the Issue Date would exceed
25% of the original aggregate principal amount of such series (such excess being
"25% Excess Proceeds"), then promptly after such fifth anniversary PCS shall
defease or retire Securities in an amount equal to the 25% Excess Proceeds.
Pending such defeasing or retiring of Securities, the 25% Excess Proceeds shall
be invested and maintained in Permitted Short-Term Investments and PCS shall not
distribute such proceeds in respect of its shares (Section 1011).
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EVENTS OF DEFAULT, NOTICE AND WAIVER
The Indenture provides that the following events are "Events of Default"
with respect to any series of Securities issued thereunder: (a) default for 30
days in the payment of any installment of interest on any Security of such
series; (b) default in the payment of principal of (or premium, if any) any
Security of such series when due; (c) default in making any sinking fund payment
as required for any Security of such series; (d) default in the performance or
breach of any other covenant or warranty of PCS contained in the Indenture
(other than a covenant added to the Indenture solely for the benefit of a series
of Securities other than such series), continued for 60 days after written
notice as provided in the Indenture; (e) a default under any bond, debenture,
note or other evidence of indebtedness for money borrowed by PCS (including
obligations under leases required to be capitalized on the balance sheet of the
lessee under GAAP but not including any indebtedness or obligations for which
recourse is limited to property purchased) in an aggregate principal amount in
excess of US$ 50,000,000 or under any mortgage, indenture or other instrument
under which there may be issued or by which there may be secured or evidenced
any indebtedness for money borrowed by PCS (including such leases, but not
including such indebtedness or obligations for which recourse is limited to
property purchased) in an aggregate principal amount in excess of US$
50,000,000, whether such indebtedness now exists or is hereafter created, which
default shall have resulted in such indebtedness becoming or being declared due
and payable prior to the date on which it would otherwise have become due and
payable or such obligations being accelerated, without such acceleration having
been rescinded or annulled; (f) certain events of bankruptcy, insolvency or
reorganization, or court appointment of a receiver, liquidator or trustee of PCS
or any Significant Subsidiary of PCS; and (g) any other Event of Default
provided with respect to a particular series of Securities (Section 501).
If an Event of Default under the Indenture with respect to Securities of
any series at the time outstanding occurs and is continuing, then in every such
case the Indenture Trustee or the holders of not less than 25% in principal
amount of the outstanding Securities of that series will have the right to
declare the principal amount (or, if the Securities of that series are Original
Issue Discount Securities or Indexed Securities, such portion of the principal
amount as may be specified in the terms thereof) of all the Securities of that
series to be due and payable immediately by written notice thereof to PCS (and
to the Indenture Trustee if given by the holders). However, at any time after
such a declaration of acceleration with respect to Securities of such series (or
of all Securities then outstanding under the Indenture, as the case may be) has
been made, but before a judgment or decree for payment of the money due has been
obtained by the Indenture Trustee, the holders of not less than a majority in
principal amount of outstanding Securities of such series (or of all Securities
then outstanding under the Indenture, as the case may be) may rescind and annul
such declaration and its consequences if (a) PCS deposits with the Indenture
Trustee all required payments of the principal of (and premium, if any) and
interest on the Securities of such series (or of all Securities then outstanding
under the Indenture, as the case may be), plus certain fees, expenses,
disbursements and advances of the Indenture Trustee, and (b) all Events of
Default, other than the non-payment of accelerated principal (or specified
portion thereof), with respect to Securities of such series (or of all
Securities then outstanding under the Indenture, as the case may be) are cured
or waived as provided in the Indenture (Section 502). The Indenture also
provides that the holders of not less than a majority in principal amount of the
outstanding Securities of any series (or of all Securities then outstanding
under the Indenture, as the case may be) may waive any past default with respect
to such series and its consequences, except a default (a) in the payment of the
principal of (or premium, if any) or interest on any Security of such series, or
(b) under a covenant or provision contained in the Indenture that cannot be
modified or amended without the consent of the holder of each outstanding
Security affected thereby (Section 513).
The Indenture Trustee will be required to give notice to the holders of
Securities within 90 days of default under the Indenture unless such default is
cured or waived; provided that such Indenture Trustee may withhold notice to the
holders of any series of Securities of any default with respect to such series
(except a default in the payment of the principal of (or premium, if any) or
interest on any Security of such series or in payment of any sinking fund
installment in respect of any Security of such series) if specified responsible
officers of such Indenture Trustee consider such withholding to be in the
interest of such holders (Section 601).
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The Indenture provides that no holders of Securities of any series may
institute any proceedings, judicial or otherwise, with respect to the Indenture
or for any remedy thereunder, except in the cases of failure of the Indenture
Trustee, for 60 days, to act after it has received a written request to
institute proceedings in respect of an Event of Default from the holders of not
less than 25% in principal amount of the outstanding Securities of such series
(Section 507). This provision will not prevent, however, any holder of
Securities from instituting suit for the enforcement of payment of the principal
of (and premium, if any) and interest on such Securities at the due dates
thereof.
Subject to provisions in the Indenture relating to its duties in case of
default, the Indenture Trustee will not be under any obligation to exercise any
of its rights or powers under the Indenture at the request of direction of any
holders of any series of Securities then outstanding under such Indenture,
unless such holders offer to the Indenture Trustee reasonable security or
indemnity. The holders of not less than a majority in principal amount of the
outstanding Securities of any series (or of all Securities then outstanding
under the Indenture, as the case may be) will have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Indenture Trustee, or of exercising any trust or power conferred upon such
Indenture Trustee. However, an Indenture Trustee may refuse to follow any
direction which is in conflict with any law or the Indenture, which may involve
the Indenture Trustee in personal liability or which may be unduly prejudicial
to the holders of Securities of such series not joining therein (Section 512).
Within 120 days after the close of each fiscal year, PCS will be required
to deliver to the Indenture Trustee a certificate, signed by one of several
specified officers of PCS, stating whether or not such officer has knowledge of
any default under the Indenture and, if so, specifying each such default and the
nature and status thereof (Section 1009).
MODIFICATION OF THE INDENTURE
Modifications and amendments of the Indenture will be permitted to be made
only with the consent of the holders of not less than a majority in principal
amount of all outstanding Securities issued under the Indenture which are
affected by such modification or amendment; provided that no such modification
or amendment may, without the consent of the holder of each Security affected
thereby, (a) change the stated maturity of the principal of (or premium, if
any), or any installment of interest on any Security; (b) reduce the principal
amount of any Security, or reduce the amount of principal of an Original Issue
Discount Security that would be due and payable upon declaration of acceleration
of the maturity thereof or would be provable in bankruptcy, or adversely affect
any right of repayment of the holder of any such Security; (c) change the place
of payment, or the coin or currency, for payment of principal of (or premium, if
any) or interest on any Security; (d) impair the right to institute suit for the
enforcement of any payment on or with respect to any Security; (e) reduce the
above-stated percentage of outstanding Securities of any series necessary to
modify or amend the Indenture, to waive compliance with certain provisions
thereof or certain defaults and consequences thereunder or to reduce the quorum
or voting requirements set forth in the Indenture; or (f) modify any of the
foregoing provisions or any of the provisions relating to the waiver of certain
past defaults or certain covenants, except to increase the required percentage
to effect such action or to provide that certain other provisions may not be
modified or waived without the consent of the holder of such Security (Section
902).
The holders of not less than a majority in principal amount of outstanding
Securities issued under the Indenture will have the right to waive compliance by
PCS with certain covenants in the Indenture (Section 1013).
Modifications and amendments of the Indenture will be permitted to be made
by PCS and the Indenture Trustee thereunder without the consent of any holder of
Securities for any of the following purposes: (a) to evidence the succession of
another person to PCS as obligor under the Indenture; (b) to add to the
covenants of PCS for the benefit of the holders of all or any series of
Securities or to surrender any right or power conferred upon PCS in the
Indenture; (c) to add Events of Default for the benefit of the holders of all or
any series of Securities; (d) to add or change any provisions of the Indenture
to facilitate the issuance of, or to liberalize certain terms of, Securities in
bearer form, or to permit or facilitate the issuance of Securities in
uncertificated form, provided that such action will not adversely affect the
interests of holders of the Securities
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in any material respect; (e) to change or eliminate any provisions of the
Indenture, provided that any such change or elimination will become effective
only when there are no Securities outstanding of any series created prior
thereto which are entitled to the benefit of such provision; (f) to secure the
Securities; (g) to establish the form or terms of Securities of any series; (h)
to provide for the acceptance of appointment by a successor Indenture Trustee or
facilitate the administration of the trusts under the Indenture by more than one
Indenture Trustee; (i) to cure any ambiguity, defect or inconsistency in the
Indenture, provided that such action will not adversely affect the interests of
holders of Securities of any series issued under such Indenture in any material
respect; or (j) to supplement any of the provisions of the Indenture to the
extent necessary to permit or facilitate defeasance and discharge of any series
of such Securities, provided that such action will not adversely affect the
interests of the holders of the Securities of any series in any material respect
(Section 901).
The Indenture will provide that in determining whether the holders of the
requisite principal amount of outstanding Securities of a series have given any
request, demand, authorization, direction, notice, consent or waiver thereunder
or whether a quorum is present at a meeting of holders of Securities, (a) the
principal amount of an Original Issue Discount Security that is deemed to be
outstanding will be the amount of the principal thereof that would be due and
payable as of the date of such determination upon declaration of acceleration of
the maturity thereof, (b) the principal amount of any Security denominated in a
currency other than U.S. dollars that will be deemed outstanding will be the
U.S. dollar equivalent, determined on the issue date for such Security, of the
principal amount (or, in the case of Original Issue Discount Security, the U.S.
dollar equivalent on the issue date of such Security of the amount determined as
provided in (a) above), (c) the principal amount of an Indexed Security that
will be deemed outstanding will be the principal face amount of such Indexed
Security at original issuance, unless otherwise provided with respect to such
Indexed Security in the Indenture, and (d) Securities owned by PCS or any other
obligor upon the Securities or any Affiliate of PCS or of such other obligor
will be disregarded (Section 101).
The Indenture contains provisions for convening meetings of the holders of
Securities of a series (Section 1501). A meeting will be permitted to be called
at any time by the Indenture Trustee, and also, upon request, by PCS or the
holders of at least 10% in principal amount of the outstanding Securities of
such series, in any such case upon notice given as provided in the Indenture
(Section 1500). Except for any consent that must be given by the holder of each
Security affected by certain modifications and amendments of the Indenture, any
resolution presented at a meeting at which a quorum is present may be adopted by
the affirmative vote of the holders of a majority in principal amount of the
outstanding Securities of that series; provided, that, except as referred to
above, any resolution with respect to any request, demand, authorization,
direction, notice, consent, waiver or other action that may be made, given or
taken by the holders of a specified percentage, which is less than a majority,
in principal amount of the outstanding Securities of a series may be adopted at
a meeting by the affirmative vote of the holders of such specified percentage in
principal amount of the outstanding Securities of that series. Any resolution
passed or decision taken at any meeting of holders of Securities of any series
duly held in accordance with the Indenture will be binding on all holders of
Securities of that series. The quorum at any meeting called to adopt a
resolution will be persons holding or representing a majority in principal
amount of the outstanding Securities of a series (Section 1504).
Notwithstanding the foregoing provision, the Indenture provides that if any
action is to be taken at a meeting of holders of Securities of any series with
respect to any request, demand, authorization, direction, notice, consent,
waiver or other action that the Indenture expressly provides may be made, given
or taken by the holders of a specified percentage, which is less than a
majority, in principal amount of all outstanding Securities affected thereby, or
of the holders of such series and one or more additional series: (a) there will
be no quorum requirement for such meeting, and (b) the principal amount of the
outstanding Securities of such series that vote in favor of such request,
demand, authorization, direction, notice, consent, waiver or other action will
determine whether such request, demand authorization, direction, notice,
consent, waiver or other action has been made, given or taken under the
Indenture (Section 1504).
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DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE
PCS is permitted under the Indenture to discharge certain obligations to
holders of any series of Securities issued thereunder that have not already been
delivered to the Indenture Trustee for cancellation and that either have become
due and payable or will become due and payable within one year (or scheduled for
redemption within one year) by irrevocably depositing with the Indenture
Trustee, in trust, funds in such currency in which such Securities are payable
in an amount sufficient to pay the entire indebtedness on such Securities in
respect of principal (and premium, if any) and interest to the date of such
deposit (if such Securities have become due and payable) or to the stated
maturity and redemption date, as the case may be (Section 401).
The Indenture provides that PCS may elect either (a) to defease and be
discharged from any and all obligations with respect to the Securities or a
series (except for the obligation to pay additional amounts, if any, upon the
occurrence of certain events of tax, assessment or governmental charge with
respect to payments on such Securities and the obligations to register the
transfer or exchange of such Securities, to replace temporary or mutilated,
destroyed, lost or stolen Securities, to maintain an office or agency in respect
of such Securities and to hold moneys for payment in trust) ("defeasance")
(Section 1402), or (b) to be released from its obligations with respect to such
Securities under the restrictions described under "-- Certain Covenants" or, if
provided pursuant to the Indenture, its obligations with respect to any other
covenant, and any omission to comply with such obligations will not constitute
an Event of Default with respect to such Securities ("covenant defeasance")
(Section 1403), in either case upon the irrevocable deposit by PCS with the
Indenture Trustee, in trust, of an amount, in such currency in which such
Securities are payable at stated maturity, or Government Obligations, or both,
applicable to such Securities which through the scheduled payment of principal
and interest in accordance with their terms will provide money in an amount
sufficient to pay the principal of (and premium, if any) and interest on such
Securities, and any mandatory sinking fund or analogous payments thereon, on the
scheduled due dates therefor (Section 1404).
Such a trust will only be permitted to be established if, among other
things, PCS has delivered to the Indenture Trustee an opinion of counsel to the
effect that the holders of such Securities will not recognize income, gain or
loss for U.S. federal income tax purposes as a result of such defeasance or
covenant defeasance and will be subject to U.S. 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 or covenant defeasance had not occurred, and such opinion of
counsel, in the case of defeasance, will be required to refer to and be based
upon a ruling of the Internal Revenue Service or a change in applicable United
States federal income tax law occurring after the date of the Indenture (Section
1404).
If after PCS has deposited funds and/or Government Obligations to effect
defeasance or covenant defeasance with respect to Securities of any series, (a)
the holder of a Security of such series is entitled to, and does, elect pursuant
to the Indenture or the terms of such Security to receive payment in a currency,
currency unit or composite currency other than that in which such deposit has
been made in respect of such Security, or (b) a Conversion Event (as defined
below) occurs in respect of the currency, currency unit or composite currency in
which such deposit has been made, the indebtedness represented by such Security
will be deemed to have been, and will be, fully discharged and satisfied though
the payment of the principal of (and premium, if any) and interest on such
Security as they become due out of the proceeds yielded by converting the amount
so deposited in respect of such Security into the currency, currency unit or
composite currency in which such Security becomes payable as a result of such
election based on the applicable market exchange rate. "Conversion Event" means
the cessation of use of (a) a currency, currency unit or composite currency both
by the government of the country which issued such currency and for the
settlement of transactions by a central bank or other public institution of or
within the international banking community, (b) the ECU, both within the
European Monetary System and for the settlement of transactions by public
institutions of or within the European Communities, or (c) any currency unit or
composite currency other than the ECU for the purposes for which it was
established. All payments of principal of (and premium, if any) and interest on
any Security that is payable in a currency other than U.S. dollars that ceases
to be used by its government of issuance will be in U.S. dollars (Section 101).
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If PCS effects covenant defeasance with respect to any Securities and such
Securities are declared due and payable because of an Event of Default, the
amount in such currency in which such Securities are payable, and Government
Obligations on deposit with the Indenture Trustee, will be sufficient to pay
amounts due on such Securities at the time of their stated maturity but may not
be sufficient to pay amounts due on such Securities at the time of the
acceleration resulting from such Event of Default. However, PCS would remain
liable to make payment of such amounts due at the time of acceleration.
GLOBAL SECURITIES
The Securities of a series may be issued in whole or in part in the form of
one or more global securities (the "Global Securities") that will be deposited
with, or on behalf of, a depositary identified in the applicable Prospectus
Supplement relating to such series. The Global Securities may be issued in
either registered or bearer form and in either temporary or permanent form. The
specific terms of the depositary arrangement with respect to a series of
Securities will be described in the applicable Prospectus Supplement relating to
such series.
CERTAIN DEFINITIONS
Set forth below is a summary of certain of the defined terms used in the
Indenture. Reference is made to the Indenture for the full definition of all
such terms, as well as other terms used herein for which no definition is
provided (Section 101).
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Attributable Debt" means, with respect to any Sale and Leaseback
Transaction as of any particular time, the present value (discounted at the rate
of interest implicit in the terms of the lease) of the obligations of the lessee
under such lease for net rental payments during the remaining term of the lease
(including any period for which such lease has been extended). "Net rental
payments" under any lease for any period means the sum of the rental and other
payments required to be paid in such period by the lessee thereunder, not
including, however, any amounts required to be paid by such lessee (whether or
not designated as rental or additional rental) on account of maintenance and
repairs, insurance, taxes, assessments or similar charges.
"Capital Stock" means, with respect to any Person, any capital stock
(including preferred stock), shares, interests, participations or other
ownership interests (however designated) of such Person and any rights (other
than debt securities convertible or exchangeable for corporate stock), warrants
or options to purchase any thereof.
"Consolidated Net Tangible Assets" of PCS means, at any date, the gross
book value as shown by the accounting books and records of PCS of all property
both real and personal of PCS and its Subsidiaries, determined on a consolidated
basis in accordance with GAAP, (including appropriate deductions for any
minority interests in property of Subsidiaries of PCS) less (a) the gross book
value of all its licenses, patents, patent applications, copyrights, trademarks,
trade names, goodwill, non-compete agreements or organizational expenses and
other like intangibles, (b) gross Debt discount and expense, (c) all reserves
for depreciation, obsolescence, depletion and amortization of its properties,
and (d) all other proper reserves which in accordance with GAAP should be
provided in connection with the business conducted by PCS or its Subsidiaries.
"Debt" of PCS or any Subsidiary means any indebtedness of PCS or any
Subsidiary, whether or not contingent, in respect of (without duplication) (a)
borrowed money, whether or not evidenced by bonds, notes, debentures or similar
instruments, (b) indebtedness secured by any Lien existing on property owned by
PCS or any Subsidiary, (c) the reimbursement obligations, contingent or
otherwise, in connection with any letters of credit actually issued or amounts
representing the balance deferred and unpaid of the purchase price
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of any property or services, except any such balance that constitutes an accrued
expense or trade payable, or all conditional sale obligations or obligations
under any title retention agreement, (d) the principal amount of all obligations
of PCS or any Subsidiary with respect to redemption, repayment or other
repurchase of any Disqualified Stock, or (e) any lease of property by PCS or any
Subsidiary as lessee which is reflected on PCS's consolidated balance sheet as a
capitalized lease in accordance with GAAP to the extent, in the case of items of
indebtedness under (a) through (c) above, that any such items (other than
letters of credit) would appear as a liability on PCS's consolidated balance
sheet in accordance with GAAP, and also includes, to the extent not otherwise
included, any obligation by PCS or any Subsidiary to be liable for, or to pay,
as obligor, guarantor or otherwise (other than for purposes of collection in the
ordinary course of business), Debt of another Person (other than PCS or any
Subsidiary).
"Disqualified Stock" means, with respect to any Person, any Capital Stock
of such Person which by the terms of such Capital Stock (or by the terms of any
security into which it is convertible or for which it is exchangeable or
exercisable), upon the happening of any event or otherwise, (a) matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, (b)
is convertible into or exchangeable or exercisable for Debt or Disqualified
Stock, or (c) is redeemable at the option of the holder thereof, in whole or in
part, in each case on or prior to the Stated Maturity of the series of
Securities.
"GAAP" means generally accepted accounting principles, as in effect from
time to time, in Canada, applied on a consistent basis.
"Government Obligations" means securities which are (a) direct obligations
of the United States of America or the government which issued the other
currency in which the Securities of a particular series are payable, 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
the United States of America or the government which issued the other currency
in which the Securities of such series are payable, the payment of which is
unconditionally guaranteed as a full faith and credit obligation by the United
States of America or such other government, which, in either case, are not
callable or redeemable at the option of the issuer thereof, and will also
include a depository receipt issued by a bank or trust as custodian with respect
to any such Government Obligation or a specific payment of interest on or
principal of any such Government Obligation held by such custodian for the
account of the holder of a depository receipt, provided that (except as required
by law) such custodian is not authorized to make any deduction from the amount
payable to the holder of such depository receipt from any amount received by the
custodian in respect of the Government Obligation or the specific payment of
interest on or principal of the Government Obligation evidenced by such
depository receipt.
"Issue Date" means the date upon which a series of Securities was first
issued and authenticated under the Indenture.
"Lien" means any mortgage, charge, security interest, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
other) or preference, priority or other security agreement except: (a) liens for
taxes and other governmental assessments, including utility charges and vault
rentals, (i) which are not yet delinquent, or (ii) which are being contested in
good faith by all appropriate proceedings; (b) carriers', warehousemen's,
mechanics', materialmen's, repairmen's, brokers' or other like liens (i) which
do not remain unsatisfied or undischarged for a period of more than 90 days, or
(ii) which are being contested in good faith by all appropriate proceedings; (c)
attachment or judgment liens not giving rise to or an Event of Default and which
are being contested in good faith by appropriate proceedings; (d) pledges or
deposits in connection with workers compensation, unemployment insurance and
other social security legislation and deposits securing liability to insurance
carriers under insurance or self-insurance arrangements; (e) deposits to secure
the performance of bids, trade contracts (other than for borrowed money),
leases, statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature incurred in the ordinary course of business;
and (f) easements, rights of way, restrictions, development orders, plats and
other similar encumbrances.
"Person" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
15
<PAGE> 17
"Permitted Short-Term Investments" means investments in obligations,
maturing not more than 180 days after the date of acquisition: (a) issued by the
Government of Canada or the United States of America, or an instrumentality or
agency thereof and guaranteed fully as to principal, premium, if any, and
interest by Canada or the United States of America; (b) issued by a province of
Canada, or an instrumentality or agency thereof, with a rating of at least R1
(low) or higher by Dominion Bond Rating Service Limited ("DBRS") or A-1 (low) or
higher by Canadian Bond Rating Service Inc. ("CBRS"); (c) term deposits,
guaranteed investment certificates, certificates of deposit, bankers'
acceptances or bearer deposit notes of any Canadian chartered bank or other
financial institution which have been rated at least A-1 by Standard & Poor's
Corporation ("S&P") or at least P-1 or the equivalent thereof by Moody's
Investors Service, Inc. ("Moody's"), or at least A-1 by CBRS or at least R1
(mid) by DBRS; (d) commercial paper issued by a corporation organized and
existing under the laws of Canada or the United States of America with a rating
of at least A-1 by S&P, P-1 by Moody's, R1 (mid) or higher by DBRS, or A-1 or
higher by CBRS; (e) any asset-backed debt securities with ratings of at least
A-1 by S&P, P-1 by Moody's, R1 (high) by DBRS, or A-1+ by CBRS; and (f) notes,
bonds, coupons, debentures or other debt securities issued by any United States
or Canadian corporation with ratings of at least A-1 by S&P, P-1 by Moody's, R1
(mid) or higher by DBRS, or A-1 or higher by CBRS; provided that in the event of
a rating downgrade on any Permitted Short-Term Investment by S&P, Moody's, DBRS
or CBRS during the period in which the Permitted Short-Term Investment is held,
PCS acting reasonably shall have the full discretion to retain the Permitted
Short-Term Investment to maturity.
"Principal Property" means (a) any real property interest (all such
interests forming an integral part of a single development or operation being
considered as one interest), including any mining claims and leases, and any
plants, buildings or other improvements thereon, and any part thereof, that is
held by PCS or any Subsidiary and has a gross book value (without deduction of
any reserve for depreciation), on the date as of which the determination is
being made, exceeding 3% of Consolidated Net Tangible Assets of PCS (other than
any such interest that the board of directors of PCS determines by resolution is
not material to the business of PCS and its Subsidiaries taken as a whole), or
(b) any of the Capital Stock or debt securities issued by any Significant
Subsidiary.
"Sale and Leaseback Transaction" of any Person means an arrangement with
any lender or investor or to which such lender or investor is a party providing
for the leasing by such Person of any property or asset of such Person which has
been or is being sold or transferred by such Person more than 270 days after the
acquisition thereof or the completion of construction or commencement of
operation thereof to such lender or investor or to any Person to whom funds have
been or are to be advanced by such lender or investor on the security of such
property or asset. The stated maturity of such arrangement is the date of the
last payment of rent or any other amount due under such arrangement prior to the
first date on which such arrangement may be terminated by the lessee without
payment of a penalty.
"Significant Subsidiary" means any Subsidiary which is a "significant
subsidiary" (as defined in Rule 1-02 of Regulation S-X, promulgated by the
Commission) of PCS.
"Stated Maturity," when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security or a coupon representing such installment of interest as the
fixed date on which the principal of such Security or such installment of
principal or interest is due and payable.
"Subsidiary" means an entity a majority of the partnership interests or a
majority of the outstanding voting stock of which is owned, directly or
indirectly, by PCS and/or one or more other Subsidiaries of PCS. For the
purposes of this definition, "voting stock" means stock having voting power for
the election of directors, whether at all times or only so long as no senior
class of stock has such voting power by reason of any contingency.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of such Person
all of the outstanding Capital Stock or other ownership interests of which
(other than directors' qualifying shares) is at the time owned by such Person
and/or one or more Wholly Owned Subsidiaries of such Person.
16
<PAGE> 18
CERTAIN INCOME TAX CONSIDERATIONS
The applicable Prospectus Supplement will describe the principal Canadian
federal income tax consequences to an investor (a) who is not resident in Canada
for purposes of the Income Tax Act (Canada) (the "Act"), (b) who is a resident
of the United States for purposes of the Canada-United States Income Tax
Convention, and (c) who meets certain other requirements (a "U.S. Investor") of
acquiring, owning and disposing of Securities, including whether the payment by
the Company of principal (and premium, if any) and interest will be subject to
Canadian non-resident withholding tax under the Act.
The applicable Prospectus Supplement also will describe the principal
United States federal income tax considerations applicable to a U.S. Investor of
acquiring, owning and disposing of Securities, including any such considerations
relating to (a) principal (and premium, if any) and interest payable with
respect to the Securities, in a currency other than the United States dollar,
(b) the issuance of Securities with "original issue discount" (as defined for
United States federal income tax purposes), if applicable, and (c) the inclusion
of any special terms in Securities that may have a material effect for United
States federal income tax purposes.
PLAN OF DISTRIBUTION
PCS may sell Securities to or through underwriters and also may sell
Securities to one or more other purchasers directly or through agents.
The distribution of Securities may be effected from time to time in one or
more transactions at a fixed price or prices, which may be changed, or at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices or at negotiated prices.
In connection with the sale of Securities, underwriters may receive
compensation from PCS or from purchasers of Securities, for whom they may act as
agents, in the form of discounts, concessions or commissions. Underwriters may
sell Securities to or through dealers, and such dealers may receive compensation
in the form of discounts, concessions or commissions from the underwriters
and/or commissions from the purchasers for whom they may act as agents.
Underwriters, dealers and agents that participate in the distribution of
Securities may be deemed to be underwriters, and any discounts or commissions
they receive from PCS, and any profit on the resale of Securities they realize
may be deemed to be underwriting discounts and commissions under the Securities
Act. Any such underwriter or agent will be identified and any such compensation
received from PCS will be described in the applicable Prospectus Supplement.
Unless otherwise specified in the applicable Prospectus Supplement, each
series of Securities will be a new issue with no established trading market. PCS
may elect to list any series of Securities on an exchange, but is not obligated
to do so. It is possible that one or more underwriters may make a market in a
series of Securities, but will not be obligated to do so and may discontinue any
market-making at any time without notice. Therefore, no assurance can be given
as to the liquidity of the trading market for the Securities.
Under agreements PCS may enter into, underwriters, dealers and agents, who
participate in the distribution of Securities, may be entitled to
indemnification by PCS against certain liabilities, including liabilities under
the Securities Act.
The Securities have not been and will not be qualified for sale under the
securities laws of Canada or any province or territory of Canada. The Securities
may not be offered or sold, directly or indirectly, in Canada, or to or for the
benefit of any resident thereof, in violation of the securities laws of Canada
or any province or territory thereof.
Underwriters, dealers and agents may engage in transactions with, or
perform services for, or be customers of, PCS in the ordinary course of
business.
17
<PAGE> 19
LEGAL MATTERS
The legality of the Securities offered hereby will be passed upon by
Robertson Stromberg, Saskatchewan counsel to PCS. Certain matters involving the
laws of the United States will be passed upon by Arent Fox Kintner Plotkin &
Kahn, U.S. counsel to PCS.
EXPERTS
The consolidated financial statements of PCS as of December 31, 1995 and
1996, and for each of the three years in the period ended December 31, 1996,
incorporated by reference herein and in the Registration Statement of which this
Prospectus is a part, have been audited by Deloitte & Touche, independent
chartered accountants, as stated in their report incorporated by reference
herein and therein, and are so incorporated in reliance upon the reports of such
firm given upon their authority as experts in accounting and auditing.
The consolidated financial statements of Arcadian Corporation as of
December 31, 1995 and 1996, and for each of the three years in the period ended
December 31, 1996, incorporated by reference herein and in the Registration
Statement of which this Prospectus is a part, have been so incorporated into
reliance upon the reports of KPMG Peat Marwick LLP, independent certified public
accountants, and Coopers & Lybrand, independent chartered accountants,
incorporated by reference herein and therein, and upon the authority of said
firms as experts in accounting and auditing.
18
<PAGE> 20
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee................... $303,030.30
*Printing and engraving................................................ 85,000.00
*Legal fees and charges................................................ 130,000.00
*Trustees' fees and expenses........................................... 10,000.00
*Accounting services................................................... 50,000.00
*Rating agency fees.................................................... 300,000.00
*Miscellaneous......................................................... 21,969.70
-----------
$900,000.00
===========
</TABLE>
- ---------------
* Estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 119 of The Business Corporations Act (Saskatchewan) authorizes
corporations to indemnify past and present directors and officers for
liabilities incurred in connection with their services as such (including
expenses and settlement payments) if the director or officer acted honestly and
in good faith with a view to the interests of the corporation and, in the case
of a criminal or administrative proceeding, if the director or officer had
reasonable grounds for believing his or her conduct was lawful. In the case of a
suit by or on behalf of the corporation, a court must approve the
indemnification.
Section 10.04 of the registrant's Bylaws provides that the registrant shall
indemnify directors and officers to the extent permitted by law.
The registrant has entered into agreements with its directors and officers
(each an "Indemnitee") to indemnify the Indemnitee, to the extent permitted by
law and subject to certain limitations, against all costs reasonably incurred by
an Indemnitee in an action or proceeding to which the Indemnitee was made a
party by reason of the Indemnitee being an officer and/or director of (a) the
registrant or (b) if at the request of the registrant, of an organization of
which the registrant is a shareholder or creditor.
The registrant maintains insurance policies relating to certain liabilities
that its directors and officers may incur in such capacity.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- ------ -----------------------
<C> <C> <S>
1 -- Underwriting Agreement.*
2 -- Agreement and Plan of Merger dated September 2, 1996, by and among the
registrant, Arcadian Corporation and PCS Nitrogen, Inc., incorporated by
reference to Annex I to the Prospectus in Registration No. 333-17841 (the "S-4
Registration Statement").
4(a) -- Form of Indenture.
4(b) -- Term Credit Agreement between The Bank of Nova Scotia and other financial
institutions and the registrant dated October 4, 1996, incorporated by reference
to Exhibit 4(b) to the S-4 Registration Statement.
</TABLE>
The registrant hereby undertakes to file with the Commission, upon request,
copies of any constituent instruments defining the rights of holders of
long-term debt of the registrant or its subsidiaries that have not
II-1
<PAGE> 21
been filed herewith because the amounts represented thereby are less than 10% of
the total assets of the registrant and its subsidiaries on a consolidated basis.
<TABLE>
<C> <C> <S>
5 -- Opinion of Robertson Stromberg with respect to the legality of the securities
being issued.
12 -- Statement re computation of ratios.
23(a) -- Consent of Deloitte & Touche.
23(b) -- Consent of Arent Fox Kintner Plotkin & Kahn.
23(c) -- Consent of Robertson Stromberg (included in Exhibit 5).
23(d) -- Consent of KPMG Peat Marwick LLP.
23(e) -- Consent of Coopers & Lybrand.
24 -- Power of Attorney, included in signature pages hereto.
25 -- Statement of Eligibility of Trustee on Form T-1.
</TABLE>
- ---------------
* To be filed by an amendment or as an exhibit to a document to be incorporated
by reference herein in connection with any underwritten offering of a
Security.
ITEM 22. 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;
(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 amount of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
offering range may be reflected in the form of a prospectus filed with
the Commission pursuant to Rule 424(b) if, in the aggregate, the changes
in volume and price represent no more than a 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective Registration Statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at the 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, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise,
II-2
<PAGE> 22
the registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel in the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
II-3
<PAGE> 23
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by or on behalf of the undersigned,
thereunto duly authorized, in the City of Saskatoon, Province of Saskatchewan,
Canada, on May 23, 1997.
POTASH CORPORATION OF SASKATCHEWAN INC.
By /s/ CHARLES E. CHILDERS
-------------------------------------
CHARLES E. CHILDERS
CHIEF EXECUTIVE OFFICER
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints Charles
E. Childers and Barry E. Humphreys his or her true and lawful attorney-in-fact
and agent, each acting alone, with full power of substitution and resubstitution
for him or her and in his or her name, place and stead, in any and all
capacities, to sign any or 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, granting unto said attorneys-in-fact and agents, each acting alone,
full power and authority to do and perform each and every act and thing
appropriate or necessary to be done in connection therewith, as fully to all
intents and purposes as he or she might or could do in person hereby ratifying
and confirming all that said attorney-in-fact and agent, acting alone, or his or
her substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
NAME TITLE DATE
---- ----- ----
<C> <S> <C>
/s/ CHARLES E. CHILDERS Chairman of the Board, President May 23, 1997
- ------------------------------------------ and Chief Executive Officer
CHARLES E. CHILDERS
/s/ BARRY E. HUMPHREYS Senior Vice President, Finance May 23, 1997
- ------------------------------------------ and Treasurer (Principal
BARRY E. HUMPHREYS Financial and Accounting
Officer)
/s/ ISABEL B. ANDERSON Director May 23, 1997
- ------------------------------------------
ISABEL B. ANDERSON
/s/ DOUGLAS J. BOURNE Director May 23, 1997
- ------------------------------------------
DOUGLAS J. BOURNE
Director
- ------------------------------------------
DENIS J. COTE
Director
- ------------------------------------------
WILLIAM J. DOYLE
/s/ HON. WILLARD Z. ESTEY, Q.C. Director May 23, 1997
- ------------------------------------------
HON. WILLARD Z. ESTEY, Q.C.
/s/ DALLAS J. HOWE Director May 23, 1997
- ------------------------------------------
DALLAS J. HOWE
</TABLE>
II-4
<PAGE> 24
<TABLE>
<CAPTION>
NAME TITLE DATE
---- ----- ----
<C> <S> <C>
/s/ JAMES F. LARDNER Director May 23, 1997
- ------------------------------------------
JAMES F. LARDNER
/s/ DONALD E. PHILLIPS Director May 23, 1997
- ------------------------------------------
DONALD E. PHILLIPS
Director
- ------------------------------------------
PAUL J. SCHOENHALS
Director
- ------------------------------------------
DARYL K. SEAMAN
/s/ E. ROBERT STROMBERG, Q.C. Director May 23, 1997
- ------------------------------------------
E. ROBERT STROMBERG, Q.C.
Director
- ------------------------------------------
JACK G. VICQ
Director
- ------------------------------------------
BARRIE A. WIGMORE
/s/ PAUL S. WISE Director May 23, 1997
- ------------------------------------------
PAUL S. WISE
</TABLE>
AUTHORIZED REPRESENTATIVE
IN THE UNITED STATES
PCS PHOSPHATE COMPANY, INC.
By /s/ THOMAS J. WRIGHT
----------------------------
THOMAS J. WRIGHT
PRESIDENT
May 23, 1997
II-5
<PAGE> 1
EXHIBIT 4(a)
--------------------------------------------
POTASH CORPORATION OF SASKATCHEWAN INC.
TO
THE BANK OF NOVA SCOTIA TRUST COMPANY OF NEW YORK
Trustee
----------------------
Indenture
Dated as of __________, 1997
----------------------
Debt Securities
--------------------------------------------
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
PARTIES 1
RECITALS OF PCS ...................................................................... 1
ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION ................. 1
SECTION 101. Definitions .................................................... 1
Act ................................................................ 2
Additional Amounts ................................................. 2
Affiliate .......................................................... 2
Authenticating Agent ............................................... 2
Attributable Debt .................................................. 2
Authorized Newspaper ............................................... 2
Bankruptcy Law ..................................................... 2
Bearer Security .................................................... 2
Board of Directors ................................................. 3
Board Resolution ................................................... 3
Business Day ....................................................... 3
calculation ........................................................ 3
Capital Stock ...................................................... 3
CEDEL .............................................................. 3
Commission ......................................................... 3
Common Depositary .................................................. 3
Common Shares ...................................................... 3
Consolidated Net Tangible Assets ................................... 3
Conversion Event ................................................... 4
Corporate Trust Office ............................................. 4
Corporation ........................................................ 4
coupon ............................................................. 4
covenant defeasance ................................................ 4
Custodian .......................................................... 4
Debt ............................................................... 4
default ............................................................ 4
Defaulted Interest ................................................. 4
defeasance ......................................................... 4
Disqualified Stock ................................................. 5
Dollar or $ ........................................................ 5
DTC ................................................................ 5
ECU ................................................................ 5
</TABLE>
-i-
<PAGE> 3
<TABLE>
<S> <C>
Euroclear .......................................................... 5
European Communities ............................................... 5
European Monetary System ........................................... 5
Event of Default ................................................... 5
executive officer .................................................. 5
Exchange Act ....................................................... 5
Exchange Date ...................................................... 5
Excluded Holder .................................................... 5
First Currency ..................................................... 5
Foreign Currency ................................................... 5
GAAP ............................................................... 5
Government Obligations ............................................. 6
Holder ............................................................. 6
Indenture .......................................................... 6
Indexed Security ................................................... 6
Interest ........................................................... 6
Interest Payment Date .............................................. 7
Issue Date ......................................................... 7
Lien ............................................................... 7
mandatory sinking fund payment ..................................... 7
Maturity ........................................................... 7
Notice of Default .................................................. 7
Officer's Certificate .............................................. 7
Opinion of Counsel ................................................. 7
optional sinking fund payment ...................................... 8
Original Issue Discount Security ................................... 8
Outstanding ........................................................ 8
Paying Agent ....................................................... 9
PCS ................................................................ 9
PCS Request and PCS Order .......................................... 9
Permitted Short-Term Investments ................................... 9
Person ............................................................. 9
Place of Payment ................................................... 9
Predecessor Security ............................................... 9
Preferred Shares ................................................... 10
Principal Property ................................................. 10
Redemption Date .................................................... 10
Redemption Price ................................................... 10
Registered Security ................................................ 10
Regular Record Date ................................................ 10
Repayment Date ..................................................... 10
Repayment Price .................................................... 10
Responsible Officer ................................................ 10
Sale and Leaseback Transaction ..................................... 10
Securities Act ..................................................... 11
Security ........................................................... 11
Security Register and Security Registrar ........................... 11
Significant Subsidiary ............................................. 11
</TABLE>
-ii-
<PAGE> 4
<TABLE>
<S> <C>
Special Record Date ................................................ 11
Stated Maturity .................................................... 11
Subsidiary ......................................................... 11
successor entity ................................................... 11
Taxes .............................................................. 11
TIA ................................................................ 11
Trustee ............................................................ 12
25% Excess Proceeds ................................................
United States ...................................................... 12
United States Person ............................................... 12
Wholly Owned Subsidiary ............................................ 12
Yield to Maturity .................................................. 12
SECTION 102. Compliance Certificates and Opinions .......................... 12
SECTION 103. Form of Documents Delivered to Trustee ........................ 13
SECTION 104. Acts of Holders ............................................... 13
SECTION 105. Notices, etc., to Trustee and PCS ............................. 15
SECTION 106. Notice to Holders; Waiver ..................................... 15
SECTION 107. Effect of Headings and Table of Contents ...................... 16
SECTION 108. Successors and Assigns ........................................ 16
SECTION 109. Separability Clause ........................................... 17
SECTION 110. Benefits of Indenture ......................................... 17
SECTION 111. Governing Law ................................................. 17
SECTION 112. Legal Holidays ................................................ 17
SECTION 113. Immunity of Shareholders, Directors, Officers and Agents of PCS 17
SECTION 114. Agent for Service; Submission to Jurisdiction ................. 17
SECTION 115. Currency Equivalent ........................................... 18
ARTICLE TWO SECURITIES FORMS ........................................................ 18
SECTION 201. Forms of Securities ........................................... 18
SECTION 202. Form of Trustee's Certificate of Authentication ............... 19
SECTION 203. Securities Issuable in Global Form ............................ 19
ARTICLE THREE THE SECURITIES ........................................................ 20
SECTION 301. Amount; Issuable in Series .................................... 20
SECTION 302. Denominations ................................................. 23
SECTION 303. Execution, Authentication, Delivery and Dating ................ 24
SECTION 304. Temporary Securities .......................................... 26
SECTION 305. Registration, Registration of Transfer and Exchange ........... 28
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities .............. 32
SECTION 307. Payment of Interest; Interest Rights Preserved ................ 33
SECTION 308. Persons Deemed Owners ......................................... 35
SECTION 309. Cancellation .................................................. 36
SECTION 310. Computation of Interest ....................................... 36
ARTICLE FOUR SATISFACTION AND DISCHARGE ............................................. 36
SECTION 401. Satisfaction and Discharge of Indenture ....................... 36
</TABLE>
-iii-
<PAGE> 5
<TABLE>
<S> <C>
SECTION 402. Application of Trust Funds .................................... 38
ARTICLE FIVE REMEDIES ............................................................... 38
SECTION 501. Events of Default ............................................. 38
SECTION 502. Acceleration of Maturity; Rescission and Annulment ............ 40
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee 41
SECTION 504. Trustee May File Proofs of Claim .............................. 42
SECTION 505. Trustee May Enforce Claims Without Possession
of Securities or Coupons ...................................... 43
SECTION 506. Application of Money Collected ................................ 43
SECTION 507. Limitation on Suits ........................................... 43
SECTION 508. Unconditional Right of Holders to Receive Principal,
Premium, if any, Interest and Additional Amounts .............. 44
SECTION 509. Restoration of Rights and Remedies ............................ 44
SECTION 510. Rights and Remedies Cumulative ................................ 44
SECTION 511. Delay or Omission Not Waiver .................................. 45
SECTION 512. Control by Holders of Securities .............................. 45
SECTION 513. Waiver of Past Defaults ....................................... 45
SECTION 514. Waiver of Usury, Stay or Extension Laws ....................... 46
SECTION 515. Undertaking for Costs ......................................... 46
ARTICLE SIX THE TRUSTEE ............................................................. 46
SECTION 601. Notice of Defaults ............................................ 46
SECTION 602. Certain Rights of Trustee ..................................... 47
SECTION 603. Not Responsible for Recitals or Issuance of Securities ........ 48
SECTION 604. May Hold Securities ........................................... 48
SECTION 605. Money Held in Trust ........................................... 48
SECTION 606. Compensation and Reimbursement ................................ 48
SECTION 607. Corporate Trustee Required; Eligibility; Conflicting Interests 49
SECTION 608. Resignation and Removal; Appointment of Successor ............. 49
SECTION 609. Acceptance of Appointment by Successor ........................ 51
SECTION 610. Merger, Conversion, Consolidation or Succession to Business ... 52
SECTION 611. Appointment of Authenticating Agent ........................... 52
ARTICLE SEVEN HOLDERS' LISTS AND REPORTS BY TRUSTEE AND PCS ......................... 54
SECTION 701. Disclosure of Names and Addresses of Holders .................. 54
SECTION 702. Reports by Trustee ............................................ 54
SECTION 703. Reports by PCS ................................................ 54
SECTION 704. PCS to Furnish Trustee Names and Addresses of Holders ......... 55
ARTICLE EIGHT CONSOLIDATION, MERGER, SALE, LEASE OR CONVEYANCE ...................... 55
SECTION 801. Consolidations and Mergers of PCS and Sales,
Leases and Conveyances Permitted Subject to Certain
Conditions .................................................... 55
SECTION 802. Rights and Duties of Successor Entity ......................... 56
</TABLE>
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<TABLE>
<S> <C>
SECTION 803. Securities to Be Secured in Certain Events .................... 56
SECTION 804. Officer's Certificate and Opinion of Counsel .................. 57
ARTICLE NINE SUPPLEMENTAL INDENTURES ................................................ 57
SECTION 901. Supplemental Indentures without Consent of Holders ............ 57
SECTION 902. Supplemental Indentures with Consent of Holders ............... 59
SECTION 903. Execution of Supplemental Indentures .......................... 60
SECTION 904. Effect of Supplemental Indentures ............................. 60
SECTION 905. Conformity with TIA ........................................... 60
SECTION 906. Reference in Securities to Supplemental Indentures ............ 60
SECTION 907. Notice of Supplemental Indentures ............................. 60
ARTICLE TEN COVENANTS ............................................................... 60
SECTION 1001. Payment of Principal, Premium, if any,
Interest and Additional Amounts .............................. 60
SECTION 1002. Maintenance of Office or Agency .............................. 61
SECTION 1003. Money for Securities Payments to Be Held in Trust ............ 62
SECTION 1004. Existence .................................................... 64
SECTION 1005. Maintenance of Properties .................................... 64
SECTION 1006. Insurance .................................................... 64
SECTION 1007. Payment of Taxes and Other Claims ............................ 64
SECTION 1008. Statement as to Compliance ................................... 64
SECTION 1009. Additional Amounts ........................................... 64
SECTION 1010. Limitation on Liens .......................................... 65
SECTION 1011. Limitation on Sale and Leaseback Transactions ................ 67
SECTION 1012. Waiver of Certain Covenants .................................. 67
ARTICLE ELEVEN REDEMPTION OF SECURITIES ............................................. 68
SECTION 1101. Applicability of Article ..................................... 68
SECTION 1102. Election to Redeem; Notice to Trustee ........................ 68
SECTION 1103. Selection by Trustee of Securities to Be Redeemed ............ 68
SECTION 1104. Notice of Redemption ......................................... 68
SECTION 1105. Deposit of Redemption Price .................................. 70
SECTION 1106. Securities Payable on Redemption Date ........................ 70
SECTION 1107. Securities Redeemed in Part .................................. 71
ARTICLE TWELVE SINKING FUNDS ........................................................ 71
SECTION 1201. Applicability of Article ..................................... 71
SECTION 1202. Satisfaction of Sinking Fund Payments with Securities......... 72
SECTION 1203. Redemption of Securities for Sinking Fund .................... 72
ARTICLE THIRTEEN REPAYMENT AT THE OPTION OF HOLDERS ................................. 73
SECTION 1301. Applicability of Article ..................................... 73
SECTION 1302. Repayment of Securities ...................................... 73
SECTION 1303. Exercise of Option ........................................... 73
</TABLE>
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<TABLE>
<S> <C>
SECTION 1304. When Securities Presented for Repayment
Become Due and Payable ....................................... 74
SECTION 1305. Securities Repaid in Part .................................... 75
ARTICLE FOURTEEN DEFEASANCE AND COVENANT DEFEASANCE ................................. 75
SECTION 1401. Applicability of Article; PCS's Option to
Effect Defeasance or Covenant Defeasance ..................... 75
SECTION 1402. Defeasance and Discharge ..................................... 75
SECTION 1403. Covenant Defeasance .......................................... 76
SECTION 1404. Conditions to Defeasance or Covenant Defeasance .............. 76
SECTION 1405. Deposited Money and Government Obligations
to Be Held in Trust; Other Miscellaneous Provisions .......... 79
ARTICLE FIFTEEN MEETINGS OF HOLDERS OF SECURITIES ................................... 80
SECTION 1501. Purposes for Which Meetings May Be Called .................... 80
SECTION 1502. Call, Notice and Place of Meetings ........................... 80
SECTION 1503. Persons Entitled to Vote at Meetings ......................... 80
SECTION 1504. Quorum; Action ............................................... 80
SECTION 1505. Determination of Voting Rights; Conduct of Meetings .......... 82
SECTION 1506. Counting Votes and Recording Action of Meetings .............. 82
</TABLE>
TESTIMONIUM
SIGNATURES AND SEALS
ACKNOWLEDGMENTS
EXHIBIT A - FORMS OF CERTIFICATION
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<PAGE> 8
POTASH CORPORATION OF SASKATCHEWAN INC.
Reconciliation and tie between TIA and Indenture
<TABLE>
<CAPTION>
TIA Section Indenture
<S> <C>
Section 310(a)(1)........................................................... 607
(a)(2)........................................................ 607
(b)........................................................... 607,608
Section 312(a).............................................................. 704
Section 312(c).............................................................. 701
Section 313(a).............................................................. 702
(c)........................................................... 702
Section 314(a).............................................................. 703
(a)(4)........................................................ 1008
(c)(1)........................................................ 102
(c)(2)........................................................ 102
(e)........................................................... 102
Section 315(b).............................................................. 601
Section 316(a) (last sentence).............................................. 101("Outstanding")
(a)(1)(A)..................................................... 512
(a)(1)(B)..................................................... 513
(b)........................................................... 508
Section 317(a)(1)........................................................... 503
(a)(2)........................................................ 504
Section 318(a).............................................................. 111
(c)........................................................... 111
</TABLE>
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NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be
a part of the Indenture.
Section 318(c) of TIA provides that the provisions of Sections 310 to
and including 317 of TIA are a part of and govern every qualified indenture,
whether or not physically contained therein.
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<PAGE> 9
INDENTURE, dated as of _________, 1997, between POTASH
CORPORATION OF SASKATCHEWAN INC., a corporation organized under the laws of the
Province of Saskatchewan (hereinafter called "PCS"), having its principal office
at Suite 500, 122 1st Avenue South, Saskatoon, Saskatchewan, Canada S7K 7G3 and
THE BANK OF NOVA SCOTIA TRUST COMPANY OF NEW YORK, a corporation organized
under the laws of the State of New York, as Trustee hereunder (hereinafter
called the "Trustee"), having its Corporate Trust Office at One Liberty Plaza,
New York, New York 10006.
RECITALS OF PCS
PCS deems it appropriate to issue from time to time for its
lawful purposes debt securities evidencing its unsecured indebtedness, and has
duly authorized the execution and delivery of this Indenture to provide for the
issuance from time to time of Securities, $1,000,000,000 aggregate principal
amount, to bear interest at the rates or formulas, to mature at such times and
to have such other provisions as shall be fixed as hereinafter provided.
This Indenture is subject to the provisions of the Trust
Indenture Act of 1939, as amended, that are deemed to be incorporated into this
Indenture and shall, to the extent applicable, be governed by such provisions.
All things necessary to make this Indenture a valid agreement
of PCS, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
Securities by the holders thereof , it is mutually covenanted and agreed, for
the equal and proportionate benefit of all holders of Securities, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions. For all purposes of this Indenture, except as
otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article One have the meanings
assigned to them in this Article One, and include the plural as well as
the singular;
(b) all other terms used herein which are defined in the TIA,
either directly or by reference therein, have the meanings assigned to
them therein;
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(c) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP; and
(d) 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 following terms shall have the indicated respective meanings:
"Act," when used with respect to any Holder, has the meaning
specified in Section 104.
"Additional Amounts" has the meaning specified in Section
1009.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Authenticating Agent" means any authenticating agent
appointed by the Trustee pursuant to Section 611.
"Attributable Debt" means, with respect to any Sale and
Leaseback Transaction as of any particular time, the present value (discounted
at the rate of interest implicit in the terms of the lease) of the obligations
of the lessee under such lease for net rental payments during the remaining term
of the lease (including any period for which such lease has been extended). "Net
rental payments" under any lease for any period means the sum of the rental and
other payments required to be paid in such period by the lessee thereunder, not
including, however, any amounts required to be paid by such lessee (whether or
not designated as rental or additional rental) on account of maintenance and
repairs, insurance, taxes, assessments or similar charges.
"Authorized Newspaper" means a newspaper, printed in the
English language or in an official language of the country of publication,
customarily published on each Business Day, whether or not published on
Saturdays, Sundays or holidays, and of general circulation in each place in
connection with which the term is used or in the financial community of each
such place. Whenever successive publications are required to be made in
Authorized Newspapers, the successive publications may be made in the same or in
different Authorized Newspapers in the same city meeting the foregoing
requirements and in each case on any Business Day.
"Bankruptcy Law" has the meaning specified in Section 501.
"Bearer Security" means any Security established pursuant to
Section 201 which is payable to bearer.
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"Board of Directors" means the board of directors of PCS, the
executive committee or any committee of that board, a managing director or any
officer duly authorized to act hereunder.
"Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of PCS to have been duly adopted by the
Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day," when used with respect to any Place of Payment
or any other particular location referred to in this Indenture or in the
Securities, means, unless otherwise specified with respect to any Securities
pursuant to Section 301, any day, other than a Saturday or Sunday, that is
neither a legal holiday nor a day on which banking institutions in that Place of
Payment or particular location are authorized or required by law, regulation or
executive order to close.
"Capital Stock" means, with respect to any Person, any capital
stock (including preferred stock), shares, interests, participations or other
ownership interests (however designated) of such Person and any rights (other
than debt securities convertible or exchangeable for corporate stock), warrants
or options to purchase any thereof.
"Calculation" has the meaning specified in Section 310.
"CEDEL" means Central de Livraison de Valeurs Mobilieres,
S.A., or its successor.
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Exchange Act, or, if at any
time after execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the TIA, then the body performing
such duties on such date.
"Common Depositary" has the meaning specified in Section
304(b).
"Common Shares" means, with respect to any Person, Capital
Stock issued by such Person other than Preferred Stock.
"Consolidated Net Tangible Assets" of PCS means, at any date,
the gross book value as shown by the accounting books and records of PCS of all
property both real and personal of PCS and its Subsidiaries, determined on a
consolidated basis in accordance with GAAP (including appropriate deductions for
any minority interests in property of Subsidiaries of PCS) , less (a) the gross
book value of all its licenses, patents, patent applications, copyrights,
trademarks, trade names, goodwill, noncompete agreements or organizational
expenses and other like intangibles, (b) gross Debt discount and expense, (c)
all reserves for depreciation, obsolescence, depletion and amortization of its
properties, and (d) all other proper reserves which in accordance with GAAP
should be provided in connection with the business conducted by PCS and its
Subsidiaries.
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"Conversion Event" means the cessation of use of (a) a Foreign
Currency both by the government of the country which issued such currency and
for the settlement of transactions by a central bank or other public
institution of or within the international banking community, (b) the ECU both
within the European Monetary System and for the settlement of transactions by
public institutions of or within the European Communities or (c) any currency
unit (or composite currency) other than the ECU for the purposes for which it
was established.
"Corporate Trust Office" means the office of the Trustee at
which, at any particular time, its corporate trust business shall be principally
administered, which office at the date hereof is located at One Liberty Plaza,
New York, New York 10006.
"Corporation" includes corporations, partnerships, limited
liability companies and trusts.
"coupon" means any interest coupon appertaining to a Bearer
Security.
"covenant defeasance" has the meaning specified in Section
1403.
"Custodian" has the meaning specified in Section 501.
"Debt" of PCS or any Subsidiary means any indebtedness of PCS
or any Subsidiary, whether or not contingent, in respect of (without
duplication) (a) borrowed money, whether or not evidenced by bonds, notes,
debentures or similar instruments, (b) indebtedness secured by any Lien existing
on property owned by PCS or any Subsidiary, (c) the reimbursement obligations,
contingent or otherwise, in connection with any letters of credit actually
issued or amounts representing the balance deferred and unpaid of the purchase
price of any property or services, except any such balance that constitutes an
accrued expense or trade payable, (d) the principal amount of all obligations of
PCS or any Subsidiary with respect to redemption, repayment or other repurchase
of any Disqualified Stock, or (e) any lease of property by PCS or any Subsidiary
as lessee which is reflected on PCS's consolidated balance sheet as a
capitalized lease in accordance with GAAP to the extent, in the case of items of
indebtedness under (a) through (c) above, that any such items (other than
letters of credit) would appear as a liability on PCS's consolidated balance
sheet in accordance with GAAP, and also includes, to the extent not otherwise
included, any obligation by PCS or any Subsidiary to be liable for, or to pay,
as obligor, guarantor or otherwise (other than for purposes of collection in the
ordinary course of business), Debt of another Person (other than PCS or any
Subsidiary).
"default" has the meaning specified in Section 601.
"Defaulted Interest" has the meaning specified in Section 307.
"defeasance" has the meaning specified in Section 1402.
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<PAGE> 13
"Disqualified Stock" means, with respect to any Person, any
Capital Stock of such Person which by the terms of such Capital Stock (or by the
terms of any security into which it is convertible or for which it is
exchangeable or exercisable), upon the happening of any event or otherwise, (a)
matures or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise, (b) is convertible into or exchangeable or exercisable for Debt or
Disqualified Stock, or (c) is redeemable at the option of the holder thereof, in
whole or in part, in each case on or prior to the Stated Maturity of the series
of Securities involved.
"Dollar" or "$" means a dollar or other equivalent unit in
such coin or currency of the United States of America as at the time shall be
legal tender for the payment of public and private debts.
"DTC" means The Depository Trust Company.
"ECU" means the European Currency Unit as defined and revised
from time to time by the Council of the European Communities.
"Euroclear" means Morgan Guaranty Trust of New York, Brussels
Office, or its successor as operator of the Euroclear System.
"European Communities" means the European Economic Community,
the European Coal and Steel Community and the European Atomic Energy Community.
"European Monetary System" means the European Monetary System
established by the Resolution of December 5, 1978 of the Council of the European
Communities.
"Event of Default" has the meaning specified in Article Five.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder by the Commission.
"Exchange Date" has the meaning specified in Section 304.
"Excluded Holder" has the meaning specified in Section 1009.
"executive officer" means such officer or officers of PCS as
are certified to the Trustee from time to time by the Secretary or any
Assistant Secretary of PCS.
"First Currency" has the meaning specified in Section 115.
"Foreign Currency" means any currency, currency unit or
composite currency, including, without limitation, the ECU, issued by the
government of one or more countries other than the United States of America or
by any recognized confederation or association of such governments.
"GAAP" means generally accepted accounting principles, as in
effect from time to time, as used in Canada applied on a consistent basis.
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<PAGE> 14
"Government Obligations" means securities which are (a) direct
obligations of the United States of America or the government which issued the
Foreign Currency in which Securities of a particular series are payable, 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
the United States of America or such government which issued the Foreign
Currency in which Securities of such series are payable, the payment of which is
unconditionally guaranteed as a full faith and credit obligation by the United
States of America or such other 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 or trust as custodian with respect
to any such Government Obligation or a specific payment of interest on or
principal of any such Government Obligation held by such custodian for the
account of the holder of a depository receipt, provided that (except as required
by law) such custodian is not authorized to make any deduction from the amount
payable to the holder of such depository receipt from any amount received by the
custodian in respect of the Government Obligation or the specific payment of
interest on or principal of the Government Obligation evidenced by such
depository receipt.
"Holder" means, in the case of a Registered Security, the
Person in whose name a Security is registered in the Security Register and, in
the case of a Bearer Security, the bearer thereof and, when used with respect to
any coupon, shall mean the bearer thereof.
"Indenture" means this instrument as originally executed or as
it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
and shall include the terms of particular series of Securities established as
contemplated by Section 301; provided, however, that, if at any time more than
one Person is acting as Trustee under this instrument, "Indenture" shall mean,
with respect to any one or more series of Securities for which such Person is
Trustee, this instrument as originally executed or as it may from time to time
be supplemented or amended by one or more indentures supplemental hereto entered
into pursuant to the applicable provisions hereof and shall include the terms of
the or those particular series of Securities for which such Person is Trustee
established as contemplated by Section 301, exclusive, however, of any
provisions or terms which relate solely to other series of Securities for which
such Person is not Trustee, regardless of when such terms or provisions were
adopted, and exclusive of any provisions or terms adopted by means of one or
more indentures supplemental hereto executed and delivered after such Person had
become such Trustee but to which such Person, as such Trustee, was not a party.
"Indexed Security" means a Security the terms of which provide
that the principal amount thereof payable at Stated Maturity may be more or less
than the principal face amount thereof at original issuance.
"Interest," when used with respect to an Original Issue
Discount Security which by its terms bears interest only after Maturity, means
interest payable after Maturity, and, when used with respect to a Security which
provides for the payment of Additional Amounts pursuant to Section 1009,
includes such Additional Amounts.
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<PAGE> 15
"Interest Payment Date," when used with respect to any
Security, means the Stated Maturity of an installment of Interest on such
Security.
"Issue Date" means the date upon which a series of Securities
is first issued and authenticated under this Indenture.
"Lien" means any mortgage, charge, security interest, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
other) or other security agreement except:
(a) liens for taxes and other governmental
assessments, including utility charges and vault rentals (i) which are not yet
delinquent, or (ii) which are being contested in good faith by appropriate
proceedings;
(b) carrier's, warehousemen's, mechanic's,
materialmen's, repairmen's, brokers' or other like liens (i) which do not remain
unsatisfied or undischarged for a period of more than 90 days, or (ii) which are
being contested in good faith by appropriate proceedings;
(c) attachment or judgment liens not giving rise to a
default or an Event of Default and which are being contested in good faith by
appropriate proceedings;
(d) pledges or deposits in connection with workers'
compensation, unemployment insurance and other social security legislation and
deposits securing liability to insurance carriers under insurance or
self-insurance arrangements;
(e) deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases, statutory obligations, surety
and appeal bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business; and
(f) easements, rights of way, restrictions,
development orders, plats and other similar encumbrances.
"mandatory sinking fund payment" has the meaning specified in
Section 1201.
"Maturity," when used with respect to any Security, means the
date on which the principal of such Security or an installment of principal
becomes due and payable as therein provided, whether at the Stated Maturity or
by declaration of acceleration, notice of redemption, notice of option to elect
repayment or otherwise.
"Notice of Default" has the meaning specified in Section 501.
"Officer's Certificate" means a certificate signed by two
executive officers of PCS and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who
may be counsel for PCS or who may be an employee of PCS and who shall be
reasonably satisfactory to the Trustee.
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<PAGE> 16
"optional sinking fund payment" has the meaning specified in
Section 1201.
"Original Issue Discount Security" means any Security which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant to
Section 502.
"Outstanding," when used with respect to Securities, means, as
of the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(a) Securities theretofore canceled or deemed canceled by the
Trustee or delivered to the Trustee for cancellation;
(b) Securities, or portions thereof, for whose payment or
redemption or repayment at the option of the Holder money in the
necessary amount has been theretofore deposited with the Trustee or any
Paying Agent (other than PCS) in trust or set aside and segregated in
trust by PCS (if PCS shall act as its own Paying Agent) for the Holders
of such Securities and any coupons appertaining thereto, provided that,
if such Securities are to be redeemed, notice of such redemption has
been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made;
(c) Securities, except to the extent provided in Sections 1402
and 1403, with respect to which PCS has effected defeasance and/or
covenant defeasance as provided in Article Fourteen;
(d) Securities in exchange for or in lieu of which other
Securities have been authenticated and delivered pursuant to this
Indenture, other than any such Securities in respect of which there
shall have been presented to the Trustee proof satisfactory to it that
such Securities are held by a bona fide purchaser in whose hands such
Securities are valid obligations of PCS; and
(e) Securities converted into Common Shares or Preferred
Shares pursuant to or in accordance with this Indenture if the terms of
such Securities provide for convertibility pursuant to Section 301;
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder or are present at
a meeting of Holders for quorum purposes, and for the purpose of making the
calculations required by TIA Section 313, (a) the principal amount of an
Original Issue Discount Security that may be counted in making such
determination or calculation and that shall be deemed to be Outstanding for such
purpose shall be equal to the amount of principal thereof that would be (or
shall have been declared to be) due and payable, at the time of such
determination, upon a declaration of acceleration of the maturity thereof
pursuant to Section 502, (b) the principal amount of any Security denominated in
a Foreign Currency that may be counted in making such determination or
calculation and that shall be deemed Outstanding for such purpose shall be equal
to the Dollar
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<PAGE> 17
equivalent, determined pursuant to Section 301 as of the date such Security is
originally issued by PCS as set forth in an Officer's Certificate relating to
exchange rates, of the principal amount (or, in the case of an Original Issue
Discount Security, the Dollar equivalent as of such date of original issuance of
the amount determined as provided in clause (a) above) of such Security, (c) the
principal amount of any Indexed Security that may be counted in making such
determination or calculation and that shall be deemed outstanding for such
purpose shall be equal to the principal face amount of such Indexed Security at
original issuance, unless otherwise provided with respect to such Security
pursuant to Section 301, and (d) Securities owned by PCS or any other obligor
upon Securities or any Affiliate of PCS or of such other obligor shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in making such calculation or in relying
upon any such request, demand, authorization, direction, notice, consent or
waiver, only Securities which the Trustee knows to be so owned shall be so
disregarded. Securities so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not PCS or any other obligor upon Securities or any Affiliate of
PCS or of such other obligor.
"Paying Agent" means any Person (including PCS acting as
Paying Agent) authorized by PCS to pay the principal of (and premium, if any) or
interest on any Securities or coupons on behalf of PCS.
"PCS" means Potash Corporation of Saskatchewan Inc. until a
successor entity shall have become such pursuant to the applicable provisions of
this Indenture, and thereafter "PCS" shall mean such successor entity.
"PCS Request" and "PCS Order" mean, respectively, a written
request or order signed in the name of PCS by two executive officers of PCS, and
delivered to the Trustee.
"Permitted Short-Term Investments" means investments
in obligations, maturing not more than 180 days after the date of acquisition:
(a) issued by the Government of Canada or the United States,
or an instrumentality or agency thereof and guaranteed fully as to
principal, premium, if any, and interest by Canada or the United States;
(b) issued by a province of Canada, or an instrumentality
or agency thereof, with a rating of at least R1 (low) or higher by
Dominion Bond Rating Service Limited ("DBRS") or A-1 (low) or higher
by Canadian Bond Rating Service Inc. ("CBRS");
(c) term deposits, guaranteed investment certificates,
certificates of deposit, bankers' acceptances or bearer deposit notes
of any Canadian chartered bank or other financial institution which
have been rated at least A-1 by Standard & Poor's Corporation ("S&P")
or at least P-1 or the equivalent thereof by Moody's Investors Service,
Inc. ("Moody's"), or at least A-1 by CBRS or at least R1 (mid) by DBRS;
(d) commercial paper issued by a corporation organized and
existing under the laws of Canada or the United States with a rating of
at least A-1 by S&P, P-1 by Moody's, R1 (mid) or higher by DBRS, or
A-1 or higher by CBRS;
(e) any asset-backed debt securities with ratings of at
least A-1 by S&P, P-1 by Moody's, R1 (high) by DBRS, or A-1+ by CBRS;
and
(f) notes, bonds, coupons, debentures or other debt
securities issued by any United States or Canadian corporation with
ratings of at least A-1 by S&P, P-1 by Moody's, R1 (mid) or higher by
DBRS, or A-1 or higher by CBRS;
provided that in the event of a rating downgrade on any Permitted Short-Term
Investment by S&P, Moody's, DBRS or CBRS during the period in which the
Permitted Short-Term Investment is held, PCS acting reasonably, shall have the
full discretion to retain the Permitted Short-Term Investment to maturity.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Place of Payment," when used with respect to Securities of or
within any series, means the place or places where the principal of (and
premium, if any) and interest on such Securities are payable as specified as
contemplated by Sections 301 and 1002.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same Debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 306 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security or a Security to which a
mutilated, destroyed, lost or stolen coupon appertains shall be deemed to
evidence the same Debt as the mutilated, destroyed, lost or stolen Security or
the Security to which the mutilated, destroyed, lost or stolen coupon
appertains.
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"Preferred Shares" means, with respect to any Person, Capital
Stock issued by such Person that are entitled to a preference or priority over
any other Capital Stock issued by such Person upon any distribution of such
Person's assets, whether by dividend or upon liquidation.
"Principal Property" means (a) any real property interest (all
such interests forming an integral part of a single development or operation
being considered as one interest), including any mining claims and leases, and
any plants, buildings or other improvements thereon, and any part thereof, that
is held by PCS or any Subsidiary and has a gross book value (without deduction
of any reserve for depreciation), on the date as of which the determination is
being made, exceeding 3% of Consolidated Net Tangible Assets of PCS (other than
any such interest that the Board of Directors determines by resolution is not
material to the business of PCS and its Subsidiaries taken as a whole), or (b)
any of the Capital Stock or debt securities issued by any Significant
Subsidiary.
"Redemption Date," when used with respect to any Security to
be redeemed, in whole or in part, means the date fixed for such redemption by or
pursuant to this Indenture.
"Redemption Price," when used with respect to any Security to
be redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Registered Security" means any Security which is registered
in the Security Register.
"Regular Record Date" for the interest payable on any Interest
Payment Date on Registered Securities of or within any series means the date
specified for that purpose as contemplated by Section 301, whether or not a
Business Day.
"Repayment Date," when used with respect to any Security to be
repaid at the option of the Holder, means the date fixed for such repayment by
or pursuant to this Indenture.
"Repayment Price," when used with respect to any Security to
be repaid at the option of the Holder, means the price at which it is to be
repaid by or pursuant to this Indenture.
"Responsible Officer," when used with respect to the Trustee,
means the chairman or vice-chairman of the board of directors, the chairman or
vice-chairman of the executive committee of the board of directors, the
president, any vice president (whether or not designated by a number or a word
or words added before or after the title "vice president"), the secretary, any
assistant secretary, the treasurer, any assistant treasurer, any corporate trust
officer, the controller or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of such officer's
knowledge and familiarity with the particular subject.
"Sale and Leaseback Transaction" of any Person means an
arrangement with any lender or investor or to which such lender or investor is a
party providing for the leasing by such Person of
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<PAGE> 19
any property or asset of such Person which has been or is being sold or
transferred by such Person more than 270 days after the acquisition thereof or
the completion of construction or commencement of operation thereof to such
lender or investor or to any Person to whom funds have been or are to be
advanced by such lender or investor on the security of such property or asset.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder by the Commission.
"Security" has the meaning stated in the first recital of this
Indenture and, more particularly, means any Security or Securities authenticated
and delivered under this Indenture; provided, however, that, if at any time
there is more than one Person acting as Trustee under this Indenture,
"Securities" with respect to the Indenture as to which such Person is Trustee
shall have the meaning stated in the first recital of this Indenture and shall
more particularly mean Securities authenticated and delivered under this
Indenture, exclusive, however, of Securities of any series as to which such
Person is not Trustee.
"Security Register" and "Security Registrar" have the
respective meanings specified in Section 305.
"Significant Subsidiary" means any Subsidiary which is a
"significant subsidiary" (as defined in Article I, Rule 1-02 of Regulation S-X,
promulgated by the Commission) of PCS.
"Special Record Date" for the payment of any Defaulted
Interest on Registered Securities of or within any series means a date fixed by
the Trustee pursuant to Section 307.
"Stated Maturity," when used with respect to any Security or
any installment of principal thereof or interest thereon, means the date
specified in such Security or a coupon representing such installment of interest
as the fixed date on which the principal of such Security or such installment of
principal or interest is due and payable.
"Subsidiary" means an entity a majority of the interests or a
majority of the outstanding voting stock of which is owned, directly or
indirectly, by PCS or by one or more other Subsidiaries of PCS. For the purposes
of this definition, "voting stock" means stock having voting power for the
election of directors, whether at all times or only so long as no senior class
of stock has such voting power by reason of any contingency.
"successor entity" has the meaning specified in Section 801.
"Taxes" has the meaning specified in Section 1009.
"TIA" means the Trust Indenture Act of 1939, as amended and as
in force at the date as of which this Indenture was executed, except as provided
in Section 905.
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<PAGE> 20
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who is then a Trustee hereunder;
provided, however, that if at any time there is more than one such Person,
"Trustee" as used with respect to Securities of any series shall mean only the
Trustee with respect to Securities of that series.
"25% Excess Proceeds" has the meaning specified in Section
1011.
"United States" means, unless otherwise specified with respect
to any Securities pursuant to Section 301, the United States of America
(including the states and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction.
"United States Person" means, unless otherwise specified with
respect to any Securities pursuant to Section 301, an individual who is a
citizen or resident of the United States, a corporation, partnership or other
entity created or organized in or under the laws of the United States or an
estate or trust the income of which is subject to United States federal income
taxation regardless of its source.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of
such Person all of the outstanding Capital Stock of which (other than directors'
qualifying shares) shall at the time be owned by such Person or by one or more
Wholly Owned Subsidiaries of such Person or by such Person and one or more
Wholly Owned Subsidiaries of such Person.
"Yield to Maturity" means the yield to maturity, computed at
the time of issuance of a Security (or, if applicable, at the most recent
redetermination of interest on such Security) and as set forth in such Security
in accordance with generally accepted United States bond yield computation
principles.
SECTION 102. Compliance Certificates and Opinions. Upon any
application or request by PCS to the Trustee to take any action under any
provision of this Indenture, PCS shall furnish to the Trustee an Officer's
Certificate stating that all conditions precedent, if any, provided for in this
Indenture (including any covenant compliance with which constitutes a condition
precedent) relating to the proposed action have been complied with and an
Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with; provided that in the case
of any such application or request as to which the furnishing of such
certificate and opinion is specifically required by any provision of this
Indenture relating to such particular application or request, no additional
certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (including certificates
delivered pursuant to Section 1008) shall include:
(a) a statement that each individual signing such certificate
or opinion has read such condition or covenant and the definitions
herein relating thereto;
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<PAGE> 21
(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 each such individual,
he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such condition
or covenant has been complied with; and
(d) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 103. Form of Documents Delivered to Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion as to some matters and one or more other such Persons as to
other matters, and any such Person may certify or give an opinion as to such
matters in one or several documents.
Any certificate or opinion of an officer of PCS may be based,
insofar as it relates to legal matters, upon an Opinion of Counsel, or a
certificate or representations by counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the opinion, certificate or
representations with respect to the matters upon which his certificate or
opinion is based are erron eous. Any such Opinion of Counsel or certificate or
representations may be based, insofar as it relates to factual matters, upon a
certificate or opinion of, or representations by, an officer or officers of PCS
stating that the information as to such factual matters is in the possession of
PCS, unless such counsel knows that the certificate or opinion or
representations as to such matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
SECTION 104. Acts of Holders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Holders of Outstanding Securities of all
series or one or more series, as the case may be, may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Holders in person or by agents duly appointed in writing. If Securities of
a series are issuable as Bearer Securities, any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture to
be given or taken by Holders of Securities of such series may, alternatively, be
embodied in and evidenced by the record of Holders of Securities of such series
voting in favor thereof, either in person or by proxies duly appointed in
writing, at any meeting of Holders of Securities of such series duly called and
held in accordance with the provisions of Article Fifteen, or a combination of
such instruments and any such record. Except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
or record or both are delivered to the Trustee and, where it is hereby expressly
required, to PCS. Such
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instrument or instruments and any such record (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the "Act" of the
Holders signing such instrument or instruments or so voting at any such meeting.
Proof of execution of any such instrument or of a writing appointing any such
agent, or of the holding by any Person of a Security, shall be sufficient for
any purpose of this Indenture. The record of any meeting of Holders of
Securities shall be proved in the manner provided in Section 1506.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other reasonable manner which the Trustee deems sufficient.
(c) The ownership of Registered Securities shall be proved by
the Security Register.
(d) The ownership of Bearer Securities may be proved by the
production of such Bearer Securities or by a certificate executed, as
depositary, by any trust company, bank, banker or other depositary, wherever
situated, if such certificate shall be deemed by the Trustee to be satisfactory,
showing that at the date therein mentioned such Person had on deposit with such
depositary, or exhibited to it, the Bearer Securities therein described; or such
facts may be proved by the certificate or affidavit of the Person holding such
Bearer Securities, if such certificate or affidavit is deemed by the Trustee to
be satisfactory. The Trustee and PCS may assume that such ownership of any
Bearer Security continues until (i) another certificate or affidavit bearing a
later date issued in respect of the same Bearer Security is produced, (ii) such
Bearer Security is produced to the Trustee by some other Person, (iii) such
Bearer Security is surrendered in exchange for a Registered Security, or (iv)
such Bearer Security is no longer Outstanding. The ownership of Bearer
Securities may also be proved in any other manner which the Trustee deems
sufficient.
(e) If PCS shall solicit from the Holders of Registered
Securities any request, demand, authorization, direction, notice, consent,
waiver or other Act, PCS may, at its option, in or pursuant to a Board
Resolution, fix in advance a record date for the determination of Holders
entitled to give such request, demand, authorization, direction, notice,
consent, waiver or other Act, but PCS shall have no obligation to do so.
Notwithstanding TIA Section 316(c), such record date shall be the record date
specified in or pursuant to such Board Resolution, which shall be a date not
earlier than the date 30 days prior to the first solicitation of Holders
generally in connection therewith and not later than the date such solicitation
is completed. If such a record date is fixed, such request, demand,
authorization, direction, notice, consent, waiver or other Act may be given
before or after such record date, but only the Holders of record at the close of
business on such record date shall be deemed to be Holders for the purposes of
determining whether Holders of the requisite proportion of Outstanding
Securities have authorized or agreed or consented to such request, demand,
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<PAGE> 23
authorization, direction, notice, consent, waiver or other Act, and for that
purpose Outstanding Securities shall be computed as of such record date;
provided that no such authorization, agreement or consent by the Holders on such
record date shall be deemed effective unless it shall become effective pursuant
to the provisions of this Indenture not later than eleven months after the
record date.
In the absence of any such record date fixed by PCS,
regardless as to whether a solicitation of the Holders is occurring on behalf of
PCS or any Holder, the Trustee may, at its option, fix in advance a record date
for the determination of such Holders entitled to give such request, demand,
authorization, direction, notice, consent, waiver or other Act, but the Trustee
shall have no obligation to do so. Any such record date shall be a date not more
than 30 days prior to the first solicitation of Holders generally in connection
therewith and no later than the date of such solicitation.
(f) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee, any
Security Registrar, any Paying Agent, any Authenticating Agent or PCS in
reliance thereon, whether or not notation of such action is made upon such
Security.
SECTION 105. Notices, etc., to Trustee and PCS. Any request,
demand, authorization, direction, notice, consent, waiver or Act of Holders or
other document provided or permitted by this Indenture to be made upon, given or
furnished to, or filed with,
(a) the Trustee by any Holder or by PCS shall be sufficient
for every purpose hereunder if made, given, furnished or filed in
writing to or with the Trustee at
(b) PCS by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly
provided) if in writing and mailed, first class postage prepaid, to PCS
addressed to it at the address of its principal office specified in the
first paragraph of this Indenture or at any other address previously
furnished in writing to the Trustee by PCS.
SECTION 106. Notice to Holders; Waiver. Where this Indenture
provides for notice of any event to Holders of Registered Securities by PCS or
the Trustee, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to
each such Holder affected by such event, at his address as it appears in the
Security Register, not later than the latest date, and not earlier than the
earliest date, prescribed for the giving of such notice. In any case where
notice to Holders of Registered 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
of Registered Securities or the sufficiency of any notice to Holders of Bearer
Securities given as provided herein.
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Any notice mailed to a Holder in the manner herein prescribed shall be
conclusively deemed to have been received by such Holder, whether or not such
Holder actually receives such notice.
If by reason of the suspension of or irregularities in regular
mail service or by reason of any other cause it shall be impracticable to give
such notice by mail, then such notification to Holders of Registered Securities
as shall be made with the approval of the Trustee shall constitute a sufficient
notification to such Holders for every purpose hereunder.
Except as otherwise expressly provided herein or otherwise
specified with respect to any Securities pursuant to Section 301, where this
Indenture provides for notice to Holders of Bearer Securities of any event, such
notice shall be sufficiently given if published in an Authorized Newspaper in
New York City and in such other city or cities as may be specified in such
Securities on a Business Day, such publication to be not later than the latest
date, and not earlier than the earliest date, prescribed for the giving of such
notice. Any such notice shall be deemed to have been given on the date of such
publication or, if published more than once, on the date of the first such
publication.
If by reason of the suspension of publication of any
Authorized Newspaper or Authorized Newspapers or by reason of any other cause it
shall be impracticable to publish any notice to Holders of Bearer Securities as
provided above, then such notification to Holders of Bearer Securities as shall
be given with the approval of the Trustee shall constitute sufficient notice to
such Holders for every purpose hereunder. Neither the failure to give notice by
publication to any particular Holder of Bearer Securities as provided above, nor
any defect in any notice so published, shall affect the sufficiency of such
notice with respect to other Holders of Bearer Securities or the sufficiency of
any notice to Holders of Registered Securities given as provided herein.
Any request, demand, authorization, direction, notice,
consent, waiver or other action required or permitted under this Indenture shall
be in the English language, except that any published notice may be in an
official language of the country of publication.
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.
SECTION 107. Effect of Headings and Table of Contents. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 108. Successors and Assigns. All covenants and
agreements in this Indenture by PCS shall bind its successors and assigns,
whether so expressed or not.
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SECTION 109. Separability Clause. In case any provision in
this Indenture or in any Security or coupon shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
SECTION 110. Benefits of Indenture. Nothing in this Indenture
or in Securities or coupons, express or implied, shall give to any Person, other
than the parties hereto, any Security Registrar, any Paying Agent, any
Authenticating Agent and their successors hereunder and the Holders, any benefit
or any legal or equitable right, remedy or claim under this Indenture.
SECTION 111. Governing Law. This Indenture and Securities and
coupons shall be governed by and construed in accordance with the law of the
State of New York. This Indenture is subject to the provisions of the TIA that
are required to be part of this Indenture and shall, to the extent applicable,
be governed by such provisions.
SECTION 112. Legal Holidays. In any case where any Interest
Payment Date, Redemption Date, Repayment Date, sinking fund payment date, Stated
Maturity or Maturity of any Security shall not be a Business Day at any Place of
Payment, then (unless otherwise provided in any Security or coupon of any
series) payment of interest or any Additional Amounts or principal (and
premium, if any) need not be made at such Place of Payment on such date, but may
be made on the next succeeding Business Day at such Place of Payment with the
same force and effect as if made on the Interest Payment Date, Redemption Date,
Repayment Date or sinking fund payment date, or at the Stated Maturity or
Maturity; provided that no interest shall accrue on the amount so payable for
the period from and after such Interest Payment Date, Redemption Date, Repayment
Date, sinking fund payment date, Stated Maturity or Maturity, as the case may
be.
SECTION 113. Immunity of Shareholders, Directors, Officers and
Agents of PCS. The obligations of PCS under the Indenture and Securities and all
documents delivered in the name of PCS in connection herewith and therewith do
not and shall not constitute personal obligations of the directors, officers,
employees, agents or shareholders of PCS or any of them, and shall not involve
any claim against or personal liability on the part of any of them, and all
persons including the Trustee shall look solely to the assets of PCS for the
payment of any claim thereunder or for the performance thereof and shall not
seek recourse against such directors, officers, employees, agents or
shareholders of PCS or any of them or any of their personal assets for such
satisfaction. The performance of the obligations of PCS under the Indenture and
Securities and all documents delivered in the name of PCS in connection
therewith shall not be deemed a waiver of any rights or powers of PCS, its
directors or its shareholders under PCS's Articles of Incorporation.
SECTION 114. Agent for Service; Submission to Jurisdiction. By
the execution and delivery of this Indenture, PCS (a) irrevocably designates and
appoints CT Corporation System, 1633 Broadway, New York, New York 10019 as its
authorized agent upon which process may be served in any suit or proceeding
arising out of or relating to Securities or this Indenture that may be
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instituted in any federal or state court in the City of New York or brought
under federal or state securities laws or brought by the Trustee (whether in its
individual capacity or in its capacity as Trustee hereunder), (b) submits to the
non-exclusive jurisdiction of any such court in any such suit or proceeding, and
(c) agrees that service of process upon CT Corporation System and written notice
of said service to PCS (mailed or delivered to its Secretary at its principal
office specified in the first paragraph of this Indenture) shall be deemed in
every respect effective service of process upon PCS in any such suit or
proceeding. PCS further agrees to take any and all action, including the
execution and filing of any and all such documents and instruments, as may be
necessary to continue such designation and appointment of CT Corporation System
in full force and effect so long as any Securities shall be outstanding.
SECTION 115. Currency Equivalent. Except as otherwise provided
in this Indenture, for purposes of the construction of the terms of this
Indenture or of Securities, in the event that any amount is stated herein in the
currency of one nation (the "First Currency"), as of any date such amount shall
also be deemed to represent the amount in the currency of any other relevant
nation which is required to purchase such amount in the First Currency at the
rate of exchange quoted by Royal Bank of Canada (or such other Canadian
chartered bank as agreed upon by each of the parties to this Indenture) at its
central foreign exchange desk in its main office in Toronto at 12:00 noon
(Toronto time) on the date of determination.
ARTICLE TWO
SECURITIES FORMS
SECTION 201. Forms of Securities. Registered Securities, if
any, of each series and Bearer Securities, if any, of each series and related
coupons shall be in substantially the forms as shall be established in one or
more indentures supplemental hereto or approved from time to time by or pursuant
to a Board Resolution in accordance with Section 301, shall have such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Indenture or any indenture supplemental hereto,
and may have such letters, numbers or other marks of identification or
designation and such legends or endorsements placed thereon as PCS may deem
appropriate and as are not inconsistent with the provisions of this Indenture,
or as may be required to comply with any law or with any rule or regulation made
pursuant thereto or with any rule or regulation of any stock exchange on which
Securities may be listed, or to conform to usage. If the forms of Securities or
coupons of any series are established by action taken pursuant to a Board
Resolution, a copy of such Board Resolution shall be delivered to the Trustee at
or prior to the delivery of the PCS Order contemplated by Section 303 for the
authentication and delivery of such Securities or coupons.
Unless otherwise specified as contemplated by Section 301,
Bearer Securities shall have interest coupons attached and shall be marked in
the manner prescribed by Subsection 240(2) of the Income Tax Act (Canada).
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The definitive Securities and coupons shall be printed,
lithographed or engraved or produced by any combination of these methods on a
steel engraved border or steel engraved borders or may be produced in any other
manner, all as determined by the officers executing such Securities or coupons,
as evidenced by their execution of such Securities or coupons.
SECTION 202. Form of Trustee's Certificate of Authentication.
Subject to Section 611, the Trustee's certificate of authentication shall be in
substantially the following form:
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
------------------------------------
as Trustee
By
---------------------
Authorized Signatory
SECTION 203. Securities Issuable in Global Form. If Securities
of or within a series are issuable in global form, as contemplated by Section
301, then, notwithstanding clause (h) of Section 301 and the provisions of
Section 302, any such Security shall represent such Outstanding Securities of
such series as shall be specified therein and may provide that it shall
represent the aggregate amount of Outstanding Securities of such series from
time to time endorsed thereon and that the aggregate amount of Outstanding
Securities of such series represented thereby may from time to time be increased
or decreased to reflect exchanges. Any endorsement of a Security in global form
to reflect the amount, or any increase or decrease in the amount, of Outstanding
Securities represented thereby shall be made by the Trustee in such manner and
upon instructions given by such Person or Persons as shall be specified therein
or in a PCS Order to be delivered to the Trustee pursuant to Section 303 or 304.
Subject to the provisions of Section 303 and, if applicable, Section 304, the
Trustee shall deliver and redeliver any Security in permanent global form in the
manner and upon instructions given by the Person or Persons specified therein or
in the applicable PCS Order. If a PCS Order pursuant to Section 303 or 304 has
been, or simultaneously is, delivered, any instructions by PCS with respect to
endorsement or delivery or redelivery of a Security in global form shall be in
writing but need not comply with Section 102 and need not be accompanied by an
Opinion of Counsel.
The provisions of the last sentence of Section 303 shall apply
to any Security represented by a Security in global form if such Security was
never issued and sold by PCS and PCS delivers to the Trustee the Security in
global form together with written instructions (which need not comply with
Section 102 and need not be accompanied by an Opinion of Counsel) with regard to
the reduction in the principal amount of Securities represented thereby,
together with the written statement contemplated by the last sentence of Section
303.
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Notwithstanding the provisions of Section 307, unless
otherwise specified as contemplated by Section 301, payment of principal of (and
premium, if any) and interest on any Security in permanent global form shall be
made to the Person or Persons specified therein.
Notwithstanding the provisions of Section 308 and except as
provided in the preceding paragraph, PCS, the Trustee and any agent of PCS and
the Trustee shall treat as the Holder of such principal amount of Outstanding
Securities represented by a permanent global Security (a) in the case of a
permanent global Security in registered form, the Holder of such permanent
global Security in registered form, or (b) in the case of a permanent global
Security in bearer form, Euroclear or CEDEL.
ARTICLE THREE
THE SECURITIES
SECTION 301. Amount; Issuable in Series. The aggregate
principal amount of Securities which may be authenticated and delivered under
this Indenture is $1,000,000,000.
Securities may be issued in one or more series. There shall be
established in one or more Board Resolutions or pursuant to authority granted by
one or more Board Resolutions and, subject to Section 303, set forth, or
determined in the manner provided, in an Officer's Certificate, or established
in one or more indentures supplemental hereto, prior to the issuance of
Securities of any series, any or all of the following, as applicable (each of
which (except for the matters set forth in clauses (a), (b) and (o) below), if
so provided, may be determined from time to time by PCS with respect to unissued
Securities of the series when issued from time to time):
(a) the designation of Securities of the series (which shall
distinguish Securities of such series from all other series of
Securities);
(b) the aggregate principal amount of Securities of the 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 the
series pursuant to Section 304, 305, 306, 906, 1107 or 1305);
(c) the date or dates, or the method by which such date or
dates will be determined, on which the principal of Securities of the
series shall be payable;
(d) the rate or rates at which Securities of the series shall
bear interest, if any, or the method by which such rate or rates shall
be determined, the date or dates from which such interest shall accrue
or the method by which such date or dates shall be determined, the
Interest Payment Dates on which such interest will be payable and the
Regular Record Date, if any, for the interest payable on any Registered
Security on any Interest Payment Date, or the method
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by which such date or dates shall be determined, and the basis upon
which interest shall be calculated if other than that of a 360-day year
of twelve 30-day months;
(e) the place or places, if any, other than or in addition to
the Borough of Manhattan, New York City, where the principal of (and
premium, if any), interest, if any, on, and Additional Amounts, if any,
payable in respect of, Securities of the series shall be payable, any
Registered Securities of the series may be surrendered for registration
of transfer, exchange or conversion and , if different from the
location specified in Section 105, notices or demands to or upon PCS in
respect of Securities of the series and this Indenture may be served;
(f) the period or periods within which, the price or prices at
which, the currency or currencies, currency unit or units or composite
currency or currencies in which, and other terms and conditions upon
which Securities of the series may be redeemed, in whole or in part, at
the option of PCS, if PCS is to have the option;
(g) the obligation, if any, of PCS to redeem, repay or
purchase Securities of the series pursuant to any sinking fund or
analogous provision or at the option of a Holder thereof, and the
period or periods within which or the date or dates on which, the price
or prices at which, the currency or currencies, currency unit or units
or composite currency or currencies in which, and other terms and
conditions upon which Securities of the series shall be redeemed,
repaid or purchased, in whole or in part, pursuant to such obligation;
(h) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which any Registered Securities
of the series shall be issuable and, if other than the denomination of
$5,000, the denomination or denominations in which any Bearer
Securities of the series shall be issuable;
(i) if other than the Trustee, the identity of each Security
Registrar and/or Paying Agent;
(j) if other than the principal amount thereof, the portion of
the principal amount of Securities of the series that shall be payable
upon declaration of acceleration of the Maturity thereof pursuant to
Section 502 or, if applicable, the portion of the principal amount of
Securities of the series that is convertible in accordance with the
provisions of this Indenture, or the method by which such portion shall
be determined;
(k) if other than Dollars, the Foreign Currency or Currencies
in which payment of the principal of (and premium, if any) or interest
or Additional Amounts, if any, on Securities of the series shall be
payable or in which Securities of the series shall be denominated;
(l) whether the amount of payments of principal of (and
premium, if any) or interest, if any, on Securities of the series may
be determined with reference to an index, formula or other method
(which index, formula or method may be based, without limitation,
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on one or more currencies, currency units, composite currencies,
commodities, equity indices or other indices), and the manner in which
such amounts shall be determined;
(m) whether the principal of (and premium, if any) or interest
or Additional Amounts, if any, on Securities of the series are to be
payable, at the election of PCS or a Holder thereof, in a currency or
currencies, currency unit or units or composite currency or currencies
other than that in which such Securities are denominated or stated to
be payable, the period or periods within which, and the terms and
conditions upon which, such election may be made, and the time and
manner of, and identity of the exchange rate agent with responsibility
for, determining the exchange rate between the currency or currencies,
currency unit or units or composite currency or currencies in which
such Securities are denominated or stated to be payable and the
currency or currencies, currency unit or units or composite currency or
currencies in which such Securities are to be so payable;
(n) provisions, if any, granting special rights to the Holders
of Securities of the series upon the occurrence of such events as may
be specified;
(o) any deletions from, modifications of or additions to the
Events of Default or covenants of PCS with respect to Securities of the
series, whether or not such Events of Default or covenants are
consistent with the Events of Default or covenants set forth herein;
(p) whether Securities of the series are to be issuable as
Registered Securities, Bearer Securities (with or without coupons) or
both, any restrictions applicable to the offer, sale or delivery of
Bearer Securities and the terms upon which Bearer Securities of the
series may be exchanged for Registered Securities of the series and
vice versa (if permitted by applicable laws and regulations), whether
any Securities of the series are to be issuable initially in temporary
global form and whether any Securities of the series are to be issuable
in permanent global form with or without coupons and, if so, whether
beneficial owners of interests in any such permanent global Security
may exchange such interests for Securities of such series and of like
tenor of any authorized form and denomination and the circumstances
under which any such exchanges may occur, if other than in the manner
provided in Section 305, and, if Registered Securities of the series
are to be issuable as a global Security, the identity of the depositary
for such series;
(q) the date as of which any Bearer Securities of the series
and any temporary global Security representing Outstanding Securities
of the series shall be dated if other than the date of original
issuance of the first Security of the series to be issued;
(r) the Person to whom any interest on any Registered Security
of the series shall be payable, if other than the Person in whose name
that Security (or one or more Predecessor Securities) is registered at
the close of business on the Regular Record Date for such interest, the
manner in which, or the Person to whom, any interest on any Bearer
Security of the series shall be payable, if otherwise than upon
presentation and surrender of the coupons appertaining
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thereto as they severally mature, and the extent to which, or the
manner in which, any interest payable on a temporary global Security on
an Interest Payment Date will be paid if other than in the manner
provided in Section 304;
(s) the applicability, if any, of Sections 1402 and/or 1403 to
Securities of the series and any provisions in modification of, in
addition to or in lieu of any of the provisions of Article Fourteen;
(t) if 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,
then the form and/or terms of such certificates, documents or
conditions;
(u) the obligation, if any, of PCS to permit the conversion of
Securities of such series into PCS's Common Shares or Preferred Shares,
as the case may be, and the terms and conditions upon which such
conversion shall be effected (including, without limitation, the
initial conversion price or rate, the conversion period, any adjustment
of the applicable conversion price and any requirements relative to the
reservation of such shares for purposes of conversion); and
(v) any other terms, conditions, rights and preferences (or
limitations on such rights and preferences) relating to the series
(which terms shall not be inconsistent with the requirements of the TIA
or the provisions of this Indenture).
All Securities of any one series and the coupons appertaining
to any Bearer Securities of such series shall be substantially identical except,
in the case of Registered Securities, as to denomination and except as may
otherwise be provided in or pursuant to such Board Resolution (subject to
Section 303) and set forth in such Officer's Certificate or in any such
indenture supplemental hereto. All Securities of any one series need not be
issued at the same time and, unless otherwise provided, a series may be
reopened, without the consent of the Holders, for issuances of additional
Securities of such series.
If any of the terms of Securities of any series are
established by action taken pursuant to one or more Board Resolutions, a copy of
an appropriate record of such action(s) shall be certified by the Secretary or
an Assistant Secretary of PCS and delivered to the Trustee at or prior to the
delivery of the Officer's Certificate setting forth the terms of Securities of
such series.
SECTION 302. Denominations. Securities of each series shall be
issuable in such denominations as shall be specified as contemplated by Section
301. With respect to Securities of any series denominated in Dollars, in the
absence of any such provisions with respect to Securities of any series,
Registered Securities of such series, other than Registered Securities issued in
global form (which may be of any denomination), shall be issuable in
denominations of $1,000 and any
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integral multiple thereof and Bearer Securities of such series, other than
Bearer Securities issued in global form (which may be of any denomination),
shall be issuable in a denomination of $5,000.
SECTION 303. Execution, Authentication, Delivery and Dating.
All Securities and any coupons appertaining thereto shall be executed on behalf
of PCS by an executive officer of PCS and attested by its Secretary or one of
its Assistant Secretaries. The signature of any of these individuals on
Securities and coupons may be manual or facsimile signatures of the present or
any future such authorized officer and may be imprinted or otherwise reproduced
on Securities.
Securities or coupons bearing the manual or facsimile
signatures of individuals who were at any time the proper officers of PCS shall
bind PCS, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities or coupons.
At any time and from time to time after the execution and
delivery of this Indenture, PCS may deliver Securities of any series, together
with any coupon appertaining thereto, executed by PCS to the Trustee for
authentication, together with a PCS Order for the authentication and delivery of
such Securities, and the Trustee in accordance with such PCS Order shall
authenticate and deliver such Securities; provided, however, that, in connection
with its original issuance, no Bearer Security shall be mailed or otherwise
delivered to any location in the United States; and provided further that,
unless otherwise specified with respect to any series of Securities pursuant to
Section 301, a Bearer Security may be delivered in connection with its original
issuance only if (a) the Person entitled to receive such Bearer Security shall
have furnished a certificate to Euroclear or CEDEL, as the case may be, in the
form set forth in Exhibit A-1 to this Indenture or such other certificate as may
be specified with respect to any series of Securities pursuant to Section 301,
dated no earlier than 15 days prior to the earlier of the date on which such
Bearer Security is delivered and the date on which any temporary Security first
becomes exchangeable for such Bearer Security in accordance with the terms of
such temporary Security and this Indenture and (b) Euroclear or CEDEL, as the
case may be, has furnished a certificate to the Trustee in the form set forth in
Exhibit A-2 to this Indenture or such other certificate as may be specified with
respect to any series of Securities pursuant to Section 301, dated no earlier
than the earlier of the date on which such Bearer Security is delivered and the
date on which any temporary Security first becomes exchangeable for such Bearer
Security in accordance with the terms of such temporary Security and this
Indenture. If any Security shall be represented by a permanent global Bearer
Security, then, for purposes of this Section 303 and Section 304, the notation
of a beneficial owner's interest therein upon original issuance of such Security
or upon exchange of a portion of a temporary global Security shall be deemed to
be delivery in connection with its original issuance of such beneficial owner's
interest in such permanent global Security. Except as permitted by Section 306,
the Trustee shall not authenticate and deliver any Bearer Security unless all
appurtenant coupons for interest then matured have been detached and canceled.
If not all Securities of any series are to be issued at one time and if the
Board Resolution or supplemental indenture establishing such series shall so
permit, such PCS Order may set forth procedures acceptable to the Trustee for
the issuance of such Securities and determining the terms of particular
Securities of such series, such as interest rate or formula, maturity date, date
of issuance and date from which interest shall accrue.
In authenticating such Securities, and accepting the
additional responsibilities under this Indenture in relation to such Securities,
the Trustee shall be entitled to receive, and (subject to TIA Section 315(a)
through 315(d)) shall be fully protected in relying upon,
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(a) an Opinion of Counsel stating that
(i) the form or forms of such Securities and any coupons
have been established in conformity with the provisions of this
Indenture;
(ii) the terms of such Securities and any coupons have
been established in conformity with the provisions of this Indenture;
and
(iii) such Securities, together with any coupons
appertaining thereto, when completed by appropriate insertions and
executed and delivered by PCS to the Trustee for authentication in
accordance with this Indenture, authenticated and delivered by the
Trustee in accordance with this Indenture and issued by PCS in the
manner and subject to any conditions specified in such Opinion of
Counsel, will constitute legal, valid and binding obligations of PCS,
enforceable in accordance with their terms, subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws of general applicability relating to
or affecting the enforcement of creditors' rights generally and to
applicable equitable principles, whether such principles are applied by
a court of equity or a court of law;
(iv) all laws and requirements in respect of the execution
and delivery by PCS of such Securities, any coupons, and of the
supplemental indentures, if any, have been complied with and that
authentication and delivery of such Securities and any coupons and the
execution and delivery of the supplemental indenture, if any, by the
Trustee will not violate the terms of the Indenture;
(v) PCS has the corporate power to issue such Securities
and any coupons, and has duly taken all necessary corporate action with
respect to such issuance; and
(vi) the issuance of such Securities and any coupons will
not contravene the articles of incorporation or by-laws of PCS, or
result in any violation of any of the terms or provisions of any
applicable law or regulation; and
(b) an Officer's Certificate stating that all conditions precedent provided
for in this Indenture relating to the issuance of such Securities have
been complied with and that, to the best of the knowledge of the signers of
such certificate, no Event of Default with respect to any Securities shall
have occurred and be continuing.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties,
obligations or immunities under Securities and this Indenture or otherwise in a
manner which is not reasonably acceptable to the Trustee.
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Notwithstanding the provisions of Section 301 and of the
preceding two paragraphs, if not all Securities of any series are to be issued
at one time, it shall not be necessary to deliver an Officer's Certificate
otherwise required pursuant to Section 301 or a PCS Order, an Opinion of Counsel
and an Officer's Certificate otherwise required pursuant to the preceding two
paragraphs at the time of issuance of each Security of such series, but such
order, opinion and certificate, with appropriate modifications to cover such
future issuances, shall be delivered at or before the time of issuance of the
first Security of such series.
Each Registered Security shall be dated the date of its
authentication and each Bearer Security shall be dated as of the date specified
as contemplated by Section 301.
No Security or coupon shall be entitled to any benefit under
this Indenture or be valid or obligatory for any purpose unless there appears on
such Security a certificate of authentication substantially in the form provided
for herein duly executed by the Trustee by manual signature of an authorized
signatory, and such certificate upon any Security shall be conclusive evidence,
and the only evidence, that such Security has been duly authenticated and
delivered hereunder and is entitled to the benefits of this Indenture.
Notwithstanding the foregoing, if any Security shall have been authenticated and
delivered hereunder but never issued and sold by PCS, and PCS shall deliver such
Security to the Trustee for cancellation as provided in Section 309 together
with a written statement (which need not comply with Section 102 and need not be
accompanied by an Opinion of Counsel) stating that such Security has never been
issued and sold by PCS, for all purposes of this Indenture such Security shall
be deemed never to have been authenticated and delivered hereunder and shall
never be entitled to the benefits of this Indenture.
SECTION 304. Temporary Securities. (a) Pending the preparation
of definitive Securities of any series, PCS may execute, and upon a PCS Order
the Trustee shall authenticate and deliver, temporary Securities which are
printed, lithographed, typewritten, mimeographed or otherwise produced, in any
authorized denomination, substantially of the tenor of the definitive
Securities in lieu of which they are issued, in registered form, or, if
authorized, in bearer form with one or more coupons or without coupons, and
with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Securities may determine, as
conclusively evidenced by their execution of such Securities. In the case of
Securities of any series, such temporary Securities may be in global form.
Except in the case of temporary Securities in global form
(which shall be exchanged in accordance with Section 304(b) or as otherwise
provided in or pursuant to a Board Resolution), if temporary Securities of any
series are issued, PCS will cause definitive Securities of that series to be
prepared without unreasonable delay. After the preparation of definitive
Securities of such series, the temporary Securities of such series shall be
exchangeable for definitive Securities of such series upon surrender of the
temporary Securities of such series at the office or agency of PCS in a Place of
Payment for that series, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Securities of any series (accompanied
by any non-matured coupons appertaining thereto), PCS shall execute and the
Trustee shall authenticate and deliver in exchange therefor a like
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principal amount of definitive Securities of the same series of authorized
denominations; provided, however, that no definitive Bearer Security shall be
delivered in exchange for a temporary Registered Security; and provided further
that a definitive Bearer Security shall be delivered in exchange for a temporary
Bearer Security only in compliance with the conditions set forth in Section 303.
Until so exchanged, the temporary Securities of any series shall in all respects
be entitled to the same benefits under this Indenture as definitive Securities
of such series.
(b) Unless otherwise provided in or pursuant to a Board
Resolution, this Section 304(b) shall govern the exchange of temporary
Securities issued in global form other than through the facilities of The
Depository Trust Company. If any such temporary Security is issued in global
form, then such temporary global Security shall, unless otherwise provided
therein, be delivered to the London office of a depositary or common depositary
(the "Common Depositary"), for the benefit of Euroclear and CEDEL, for credit to
the respective accounts of the beneficial owners of such Securities (or to such
other accounts as they may direct).
Without unnecessary delay but in any event not later than the
date specified in, or determined pursuant to the terms of, any such temporary
global Security (the "Exchange Date"), PCS shall deliver to the Trustee
definitive Securities, in aggregate principal amount equal to the principal
amount of such temporary global Security, executed by PCS. On or after the
Exchange Date, such temporary global Security shall be surrendered by the Common
Depositary to the Trustee, as PCS's agent for such purpose, to be exchanged, in
whole or from time to time in part, for definitive Securities without charge,
and the Trustee shall authenticate and deliver, in exchange for each portion of
such temporary global Security, an equal aggregate principal amount of
definitive Securities of the same series of authorized denominations and of like
tenor as the portion of such temporary global Security to be exchanged. The
definitive Securities to be delivered in exchange for any such temporary global
Security shall be in bearer form, registered form, permanent global bearer form
or permanent global registered form, or any combination thereof, as specified as
contemplated by Section 301, and, if any combination thereof is so specified,
as requested by the beneficial owner thereof; provided, however, that, unless
otherwise specified in such temporary global Security, upon such presentation by
the Common Depositary, such temporary global Security is accompanied by a
certificate dated no earlier than the Exchange Date or the relevant Interest
Payment Date occurring prior to the Exchange Date, as applicable, and signed by
Euroclear as to the portion of such temporary global Security held for its
account then to be exchanged and a certificate dated no earlier than the
Exchange Date or the relevant Interest Payment Date occurring prior to the
Exchange Date, as applicable, and signed by CEDEL as to the portion of such
temporary global Security held for its account then to be exchanged, each in the
form set forth in Exhibit A-2 to this Indenture or in such other form as may be
established pursuant to Section 301; and provided further that definitive Bearer
Securities shall be delivered in exchange for a portion of a temporary global
Security only in compliance with the requirements of Section 303.
Unless otherwise specified in such temporary global Security,
the interest of a beneficial owner of Securities of a series in a temporary
global Security shall be exchanged for definitive Securities of the same series
and of like tenor following the Exchange Date when the account holder instructs
Euroclear or CEDEL, as the case may be, to request such exchange on his behalf
and delivers to Euroclear or CEDEL, as the case may be, a certificate in the
form set forth in Exhibit A-1
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to this Indenture (or in such other form as may be established pursuant to
Section 301), dated no earlier than 15 days prior to the Exchange Date, copies
of which certificate shall be available from the offices of Euroclear and CEDEL,
the Trustee, any Authenticating Agent appointed for such series of Securities
and each Paying Agent. Unless otherwise specified in such temporary global
Security, any such exchange shall be made free of charge to the beneficial
owners of such temporary global Security, except that a Person receiving
definitive Securities must bear the cost of insurance, postage, transportation
and the like unless such Person takes delivery of such definitive Securities in
person at the offices of Euroclear or CEDEL. Definitive Securities in bearer
form to be delivered in exchange for any portion of a temporary global Security
shall be delivered only outside the United States.
Until exchanged in full as hereinabove provided, the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of the same series and of like
tenor authenticated and delivered hereunder, except that, unless otherwise
specified as contemplated by Section 301, interest payable on a temporary global
Security on an Interest Payment Date for Securities of such series occurring
prior to the applicable Exchange Date shall be payable to Euroclear and CEDEL on
such Interest Payment Date upon delivery by Euroclear and CEDEL to the Trustee
of a certificate or certificates in the form set forth in Exhibit A-2 to this
Indenture (or in such other forms as may be established pursuant to Section
301), for credit without further interest on or after such Interest Payment Date
to the respective accounts of Persons who are the beneficial owners of such
temporary global Security on such Interest Payment Date and who have each
delivered to Euroclear or CEDEL, as the case may be, a certificate dated no
earlier than 15 days prior to the Interest Payment Date occurring prior to such
Exchange Date in the form set forth as Exhibit A-1 to this Indenture (or in such
other forms as may be established pursuant to Section 301). Notwithstanding
anything to the contrary herein contained, the certifications made pursuant to
this paragraph shall satisfy the certification requirements of the preceding two
paragraphs of this Section 304(b) and of the third paragraph of Section 303 of
this Indenture and the interests of the Persons who are the beneficial owners of
the temporary global Security with respect to which such certification was made
will be exchanged for definitive Securities of the same series and of like tenor
on the Exchange Date or the date of certification if such date occurs after the
Exchange Date, without further act or deed by such beneficial owners. Except as
otherwise provided in this paragraph, no payments of principal or interest owing
with respect to a beneficial interest in a temporary global Security will be
made unless and until such interest in such temporary global Security shall have
been exchanged for an interest in a definitive Security. Any interest so
received by Euroclear and CEDEL and not paid as herein provided shall be
returned to the Trustee not later than one month prior to the expiration of two
years after such Interest Payment Date in order to be repaid to PCS in
accordance with Section 1003.
SECTION 305. Registration, Registration of Transfer and
Exchange. PCS shall cause to be kept at the Corporate Trust Office of the
Trustee or in any office or agency of PCS in a Place of Payment a register for
each series of Securities (the registers maintained in such office or in any
such office or agency of PCS in a Place of Payment being herein sometimes
referred to collectively as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, PCS
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shall provide for the registration of Registered Securities and of transfers of
Registered Securities. The Security Register shall be in written form or any
other form capable of being converted into written form within a reasonable
time. The Trustee, at its Corporate Trust Office, is hereby appointed "Security
Registrar" for the purpose of registering Registered Securities and transfers of
Registered Securities on such Security Register as herein provided. In the event
that the Trustee shall cease to be Security Registrar, it shall have the right
to examine the Security Register at all reasonable times.
Subject to the provisions of this Section 305, upon surrender
for registration of transfer of any Registered Security of any series at any
office or agency of PCS in a Place of Payment for that series, PCS shall
execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Registered Securities of
the same series, of any authorized denominations and of a like aggregate
principal amount, bearing a number not contemporaneously outstanding, and
containing identical terms and provisions.
Subject to the provisions of this Section 305, at the option
of the Holder, Registered Securities of any series may be exchanged for other
Registered Securities of the same series, of any authorized denomination or
denominations and of a like aggregate principal amount, containing identical
terms and provisions, upon surrender of Registered Securities to be exchanged at
any such office or agency. Whenever any such Registered Securities are so
surrendered for exchange, PCS shall execute, and the Trustee shall authenticate
and deliver, Registered Securities which the Holder making the exchange is
entitled to receive. Unless otherwise specified with respect to any series of
Securities as contemplated by Section 301, Bearer Securities may not be issued
in exchange for Registered Securities.
If (but only if) permitted by the applicable Board Resolution
and (subject to Section 303) set forth in the applicable Officer's Certificate,
or in any indenture supplemental hereto, delivered as contemplated by Section
301, at the option of the Holder, Bearer Securities of any series may be
exchanged for Registered Securities of the same series of any authorized
denominations and of a like aggregate principal amount and tenor, upon surrender
of Bearer Securities to be exchanged at any such office or agency, with all
unmatured coupons and all matured coupons in default thereto appertaining. If
the Holder of a Bearer Security is unable to produce any such unmatured coupon
or coupons or matured coupon or coupons in default, any such permitted exchange
may be effected if such Bearer Securities are accompanied by payment in funds
acceptable to PCS in an amount equal to the face amount of such missing coupon
or coupons, or the surrender of such missing coupon or coupons may be waived by
PCS and the Trustee if there is furnished to them such security or indemnity as
they may require to save each of them and any Paying Agent harmless. If
thereafter the Holder of such Security shall surrender to any Paying Agent any
such missing coupon in respect of which such a payment shall have been made,
such Holder shall be entitled to receive the amount of such payment; provided,
however, that, except as otherwise provided in Section 1002, interest
represented by coupons shall be payable only upon presentation and surrender of
those coupons at an office or agency located outside the United States.
Notwithstanding the foregoing, in case a Bearer Security of any series is
surrendered at any such office or agency in a permitted exchange for a
Registered Security of the same series and like tenor after the close of
business at such office or
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agency on (a) any Regular Record Date and before the opening of business at such
office or agency on the relevant Interest Payment Date, or (b) any Special
Record Date and before the opening of business at such office or agency on the
related proposed date for payment of Defaulted Interest, such Bearer Security
shall be surrendered without the coupon relating to such Interest Payment Date
or proposed date for payment, as the case may be, and interest or Defaulted
Interest, as the case may be, will not be payable on such Interest Payment Date
or proposed date for payment, as the case may be, in respect of the Registered
Security issued in exchange for such Bearer Security, but will be payable only
to the Holder of such coupon when due in accordance with the provisions of this
Indenture. Whenever any Securities are so surrendered for exchange, PCS shall
execute, and the Trustee shall authenticate and deliver, any Securities which
the Holder making the exchange is entitled to receive.
Notwithstanding the foregoing, except as otherwise specified
as contemplated by Section 301, any permanent global Security shall be
exchangeable only as provided in this paragraph. If the depositary for any
permanent global Security is The Depository Trust Company ("DTC"), then, unless
the terms of such global Security expressly permit such global Security to be
exchanged in whole or in part for definitive Securities, a global Security may
be transferred, in whole but not in part, only to a nominee of DTC, or by a
nominee of DTC to DTC, or to a successor to DTC for such global Security
selected or approved by PCS or to a nominee of such successor to DTC. If at any
time DTC notifies PCS that it is unwilling or unable to continue as depositary
for the applicable global Security or Securities or if at any time DTC ceases to
be a clearing agency registered under the Exchange Act if so required by
applicable law or regulation, PCS shall appoint a successor depositary with
respect to such global Security or Securities. If (a) a successor depositary for
such global Security or Securities is not appointed by PCS within 90 days after
PCS receives such notice or becomes aware of such unwillingness, inability or
ineligibility, (b) an Event of Default has occurred and is continuing and the
beneficial owners representing a majority in principal amount of the applicable
series of Securities represented by such global Security or Securities advise
DTC to cease acting as depositary for such global Security or Securities, or (c)
PCS, in its sole discretion, determines at any time that all Outstanding
Securities (but not less than all) of any series issued or issuable in the form
of one or more global Securities shall no longer be represented by such global
Security or Securities, then PCS shall execute, and the Trustee shall
authenticate and deliver definitive Securities of like series, tenor and terms
in definitive form in an aggregate principal amount equal to the principal
amount of such global Security or Securities. If any beneficial owner of an
interest in a permanent global Security is otherwise entitled to exchange such
interest for Securities of such series and of like tenor and principal amount of
another authorized form and denomination, as specified as contemplated by
Section 301 and provided that any applicable notice provided in the permanent
global Security shall have been given, then without unnecessary delay but in any
event not later than the earliest date on which such interest may be so
exchanged, PCS shall execute, and the Trustee shall authenticate and deliver
definitive Securities in aggregate principal amount equal to the principal
amount of such beneficial owner's interest in such permanent global Security. On
or after the earliest date on which such interests may be so exchanged, such
permanent global Security shall be surrendered for exchange by DTC or such other
depositary as shall be specified in the PCS Order with respect thereto to the
Trustee, as PCS's agent for such purpose, to be exchanged, in whole or
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from time to time in part, for definitive Securities without charge, and the
Trustee shall authenticate and deliver, in exchange for each portion of such
permanent global Security, an equal aggregate principal amount of definitive
Securities of the same series of authorized denominations and of like tenor as
the portion of such permanent global Security to be exchanged which, unless
Securities of the series are not issuable both as Bearer Securities and as
Registered Securities, as specified as contemplated by Section 301, shall be in
the form of Bearer Securities or Registered Securities, or any combination
thereof, as shall be specified by the beneficial owner thereof; provided,
however, that no such exchanges may occur during a period beginning at the
opening of business 15 days before any selection of Securities to be redeemed
and ending on the relevant Redemption Date if the Security for which exchange is
requested may be among those selected for redemption; and provided further that
no Bearer Security delivered in exchange for a portion of a permanent global
Security shall be mailed or otherwise delivered to any location in the United
States. If a Registered Security is issued in exchange for any portion of a
permanent global Security after the close of business at the office or agency
where such exchange occurs on (x) any Regular Record Date and before the
opening of business at such office or agency on the relevant Interest Payment
Date, or (y) any Special Record Date and before the opening of business at such
office or agency on the related proposed date for payment of Defaulted
Interest, then interest or Defaulted Interest, as the case may be, will not be
payable on such Interest Payment Date or proposed date for payment, as the case
may be, in respect of such Registered Security, but will be payable on such
Interest Payment Date or proposed date for payment, as the case may be, only to
the Person to whom interest in respect of such portion of such permanent global
Security is payable in accordance with the provisions of this Indenture.
All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of PCS, evidencing the
same debt, and entitled to the same benefits under this Indenture, as Securities
surrendered upon such registration of transfer or exchange.
Every Registered Security presented or surrendered for
registration of transfer or for exchange or redemption shall (if so required by
PCS or the Security Registrar) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to PCS and the Security Registrar,
duly executed by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange of Securities, but PCS may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities, other
than exchanges pursuant to Section 304, 906, 1107 or 1305 not involving any
transfer.
PCS or the Trustee, as applicable, shall not be required (a)
to issue, register the transfer of or exchange any Security if such Security may
be among those selected for redemption during a period beginning at the opening
of business 15 days before selection of Securities to be redeemed under Section
1103 and ending at the close of business on (i) if such Securities are issuable
only as Registered Securities, the day of the mailing of the relevant notice of
redemption, and (ii) if such Securities are issuable as Bearer Securities, the
day of the first publication of the relevant notice of
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redemption or, if such Securities are also issuable as Registered Securities and
there is no publication, the mailing of the relevant notice of redemption, (b)
to register the transfer of or exchange any Registered Security so selected for
redemption in whole or in part, except, in the case of any Registered Security
to be redeemed in part, the portion thereof not to be redeemed, (c) to exchange
any Bearer Security so selected for redemption except that such a Bearer
Security may be exchanged for a Registered Security of that series and like
tenor, provided that such Registered Security shall be simultaneously
surrendered for redemption, or (d) to issue, register the transfer of or
exchange any Security which has been surrendered for repayment at the option of
the Holder, except the portion, if any, of such Security not to be so repaid.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security or a Security with a mutilated coupon appertaining to
it is surrendered to the Trustee or PCS, together with, in proper cases, such
security or indemnity as may be required by PCS or the Trustee to save each of
them or any agent of either of them harmless, PCS shall execute and the Trustee
shall authenticate and deliver in exchange therefor a new Security of the same
series and principal amount, containing identical terms and provisions and
bearing a number not contemporaneously outstanding, with coupons corresponding
to the coupons, if any, appertaining to the surrendered Security.
If there shall be delivered to PCS and to the Trustee (a)
evidence to their satisfaction of the destruction, loss or theft of any Security
or coupon, and (b) such security or indemnity as may be required by them to save
each of them and any agent of either of them harmless, then, in the absence of
notice to PCS or the Trustee that such Security or coupon has been acquired by a
bona fide purchaser, PCS shall execute and upon its request the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen Security
or in exchange for the Security to which a destroyed, lost or stolen coupon
appertains (with all appurtenant coupons not destroyed, lost or stolen), a new
Security of the same series and principal amount, containing identical terms and
provisions and bearing a number not contemporaneously outstanding, with coupons
corresponding to the coupons, if any, appertaining to such destroyed, lost or
stolen Security or to the Security to which such destroyed, lost or stolen
coupon appertains.
Notwithstanding the provisions of the previous two paragraphs,
in case any such mutilated, destroyed, lost or stolen Security or coupon has
become or is about to become due and payable, PCS in its discretion may, instead
of issuing a new Security, with coupons corresponding to the coupons, if any,
appertaining to such mutilated, destroyed, lost or stolen Security or to the
Security to which such mutilated, destroyed, lost or stolen coupon appertains,
pay such Security or coupon; provided, however, that payment of principal of
(and premium, if any), any interest on and any Additional Amounts with respect
to, Bearer Securities shall, except as otherwise provided in Section 1002, be
payable only at an office or agency located outside the United States and,
unless otherwise specified as contemplated by Section 301, any interest on
Bearer Securities shall be payable only upon presentation and surrender of the
coupons appertaining thereto.
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Upon the issuance of any new Security under this Section, PCS
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series with its coupons, if any,
issued pursuant to this Section 306 in lieu of any mutilated, destroyed, lost or
stolen Security, or in exchange for a Security to which a mutilated, destroyed,
lost or stolen coupon appertains, shall constitute an original additional
contractual obligation of PCS, whether or not the mutilated, destroyed, lost or
stolen Security and its coupons, if any, or the mutilated, destroyed, lost or
stolen coupon shall be at any time enforceable by anyone, and shall be entitled
to all the benefits of this Indenture equally and proportionately with any and
all other Securities of that series and their coupons, if any, duly issued
hereunder.
The provisions of this Section 306 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities or
coupons.
SECTION 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise specified with respect to a series of Securities in
accordance with the provisions of Section 301, interest on any Registered
Security that is payable, and is punctually paid or duly provided for, on any
Interest Payment Date shall be paid to the Person in whose name that Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest at the office or agency of PCS
maintained for such purpose pursuant to Section 1002; provided, however, that
each installment of interest on any Registered Security may at PCS's option be
paid by (a) mailing a check for such interest, payable to or upon the written
order of the Person entitled thereto pursuant to Section 308, to the address of
such Person as it appears on the Security Register, or (b) transfer to an
account maintained by the payee located inside the United States.
Unless otherwise provided as contemplated by Section 301 with
respect to Securities of any series, payment of interest may be made, in the
case of a Bearer Security, by transfer to an account maintained by the payee
with a bank located outside the United States.
Unless otherwise provided as contemplated by Section 301,
every permanent global Security will provide that interest, if any, payable on
any Interest Payment Date will be paid to DTC, Euroclear and/or CEDEL, as the
case may be, with respect to that portion of such permanent global Security held
for its account by Cede & Co. or the Common Depositary, as the case may be, for
the purpose of permitting such party to credit the interest received by it in
respect of such permanent global Security to the accounts of the beneficial
owners thereof.
In case a Bearer Security of any series is surrendered in
exchange for a Registered Security of such series after the close of business
(at an office or agency in a Place of Payment for such series) on any Regular
Record Date and before the opening of business (at such office or agency) on the
next succeeding Interest Payment Date, such Bearer Security shall be surrendered
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without the coupon relating to such Interest Payment Date and interest will not
be payable on such Interest Payment Date in respect of the Registered Security
issued in exchange for such Bearer Security, but will be payable only to the
Holder of such coupon when due in accordance with the provisions of this
Indenture.
Any Interest on any Registered Security of any series that is
payable, but is not punctually paid or duly provided for, on any Interest
Payment Date shall forthwith cease to be payable to the registered Holder
thereof on the relevant Regular Record Date by virtue of having been such
Holder, and such defaulted interest and, if applicable, interest on such
defaulted interest (to the extent lawful) at the rate specified in Securities of
such series (such defaulted interest and, if applicable, interest thereon herein
collectively called "Defaulted Interest") shall be paid by PCS, at its election
in each case, as provided in clause (a) or (b) below:
(a) PCS may elect to make payment of any Defaulted Interest to
the Persons in whose names Registered Securities of such series (or
their respective Predecessor Securities) are registered at the close of
business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. PCS shall
notify the Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each Registered Security of such series and the
date of the proposed payment (which shall not be less than 20 days
after such notice is received by the Trustee), and at the same time PCS
shall deposit with the Trustee an amount of money in the currency or
currencies, currency unit or units or composite currency or currencies
in which Securities of such series are payable (except as otherwise
specified pursuant to Section 301 for Securities of such series) equal
to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit on or prior to the date of the proposed
payment, such money when deposited to be held in trust for the benefit
of the Persons entitled to such Defaulted Interest as in this clause
provided. Thereupon the Trustee shall fix a Special Record Date for the
payment of such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the date of the proposed payment and
not less than 10 days after the receipt by the Trustee of the notice of
the proposed payment. The Trustee shall promptly notify PCS of such
Special Record Date and, in the name and at the expense of PCS, shall
cause notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor to be given in the manner provided in
Section 106 not less than 10 days prior to such Special Record Date.
The Trustee may, in its discretion, in the name and at the expense of
PCS, cause a similar notice to be published at least once in an
Authorized Newspaper in each Place of Payment, but such publications
shall not be a condition precedent to the establishment of such Special
Record Date. Notice of the proposed payment of such Defaulted Interest
and the Special Record Date therefor having been mailed as aforesaid,
such Defaulted Interest shall be paid to the Persons in whose names
Registered Securities of such series (or their respective Predecessor
Securities) are registered at the close of business on such Special
Record Date and shall no longer be payable pursuant to the following
clause (b). In case a Bearer Security of any series is surrendered at
the office or agency in a Place of Payment for such series in exchange
for a Registered Security of such series after the close of business at
such office or agency on any
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Special Record Date and before the opening of business at such office
or agency on the related proposed date for payment of Defaulted
Interest, such Bearer Security shall be surrendered without the coupon
relating to such proposed date of payment and Defaulted Interest will
not be payable on such proposed date of payment in respect of the
Registered Security issued in exchange for such Bearer Security, but
will be payable only to the Holder of such coupon when due in
accordance with the provisions of this Indenture.
(b) PCS may make payment of any Defaulted Interest on
Registered Securities of any series in any other lawful manner not
inconsistent with the requirements of any securities exchange on which
such Securities may be listed, and upon such notice as may be required
by such exchange, if, after notice given by PCS to the Trustee of the
proposed payment pursuant to this clause, such manner of payment shall
be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section 307 and
Section 305, each Security delivered under this Indenture upon registration of
transfer of or in exchange for or in lieu of any other Security shall carry the
rights to interest accrued and unpaid, and to accrue, which were carried by such
other Security.
SECTION 308. Persons Deemed Owners. Prior to due presentment
of a Registered Security for registration of transfer, PCS, the Trustee and any
agent of PCS or the Trustee may treat the Person in whose name such Registered
Security is registered as the owner of such Security for the purpose of
receiving payment of principal of (and premium, if any), and (subject to
Sections 305 and 307) interest on, such Registered Security and for all other
purposes whatsoever, whether or not such Registered Security be overdue, and
neither PCS, the Trustee nor any agent of PCS or the Trustee shall be affected
by notice to the contrary.
Title to any Bearer Security and any coupons appertaining
thereto shall pass by delivery. PCS, the Trustee and any agent of PCS or the
Trustee may treat the Holder of any Bearer Security and the Holder of any coupon
as the absolute owner of such Security or coupon for the purpose of receiving
payment thereof or on account thereof and for all other purposes whatsoever,
whether or not such Security or coupon be overdue, and neither PCS, the Trustee
nor any agent of PCS or the Trustee shall be affected by notice to the contrary.
None of PCS, the Trustee, any Paying Agent or the Security
Registrar will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests of a Security in global form or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
Notwithstanding the foregoing, with respect to any global
Security, nothing herein shall prevent PCS, the Trustee, or any agent of PCS or
the Trustee, from giving effect to any written certification, proxy or other
authorization furnished by any depositary, as a Holder, with respect to such
global Security or impair, as between such depositary and owners of beneficial
interests in such
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global Security, the operation of customary practices governing the exercise of
the rights of such depositary (or its nominee) as Holder of such global
Security.
SECTION 309. Cancellation. All Securities and coupons
surrendered for payment, redemption, repayment at the option of the Holder,
registration of transfer or exchange or for credit against any sinking fund
payment shall, if surrendered to any Person other than the Trustee, be delivered
to the Trustee, and any such Securities and coupons surrendered directly to the
Trustee for any such purpose shall be promptly canceled by it; provided,
however, where the Place of Payment is located outside of the United States, the
Paying Agent at such Place of Payment may cancel Securities surrendered to it
for such purposes prior to delivering such Securities to the Trustee. PCS may at
any time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which PCS may have acquired in any manner
whatsoever, and may deliver to the Trustee (or to any other Person for delivery
to the Trustee) for cancellation any Securities previously authenticated
hereunder which PCS has not issued and sold, and all Securities so delivered
shall be promptly canceled by the Trustee. If PCS shall so acquire any
Securities, however, such acquisition shall not operate as a redemption or
satisfaction of the indebtedness represented by such Securities unless and until
the same are surrendered to the Trustee for cancellation. No Securities shall be
authenticated in lieu of or in exchange for any Securities canceled as provided
in this Section 309, except as expressly permitted by this Indenture. Canceled
Securities and coupons held by the Trustee shall be destroyed by the Trustee and
the Trustee shall deliver a certificate of such destruction to PCS, unless by a
PCS Order PCS directs their return to it.
SECTION 310. Computation of Interest. Except as otherwise
specified as contemplated by Section 301 with respect to Securities of any
series, interest on Securities of each series shall be computed on the basis of
a 360-day year consisting of twelve 30-day months. For the purposes of
disclosure under the Interest Act (Canada), the yearly rate of interest to which
interest calculated under a Security for any period in any calendar year (the
"calculation period") is equivalent, is the rate payable under a Security in
respect of the calculation period multiplied by a fraction the numerator of
which is the actual number of days in such calendar year and the denominator of
which is the actual number of days in the calculation period.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture. This
Indenture shall upon PCS Request cease to be of further effect with respect to
any series of Securities specified in such PCS Request (except as to any
surviving rights of registration of transfer or exchange of Securities of such
series expressly provided for herein or pursuant hereto, the rights of Holders
of Outstanding Securities and any related coupons to receive, solely from the
trust fund described in subclause (ii) of clause (a) of this Section 401,
payments in respect of the principal of (and premium, if any) and interest on
such Securities and any related coupon when such payments are due, and any right
to
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receive Additional Amounts, as provided in Section 1009), and the Trustee, upon
receipt of a PCS Order, and at the expense of PCS, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture as to
such series when
(a) either
(i) all Securities of such series theretofore
authenticated and delivered and all coupons, if any,
appertaining thereto (other than (A) coupons appertaining to
Bearer Securities surrendered for exchange for Registered
Securities and maturing after such exchange, whose surrender
is not required or has been waived as provided in Section 305,
(B) Securities and coupons of such series which have been
destroyed, lost or stolen and which have been replaced or paid
as provided in Section 306, (C) coupons appertaining to
Securities called for redemption and maturing after the
relevant Redemption Date, whose surrender has been waived as
provided in Section 1106, and (D) Securities and coupons of
such series for whose payment money has theretofore been
deposited in trust or segregated and held in trust by PCS and
thereafter repaid to PCS or discharged from such trust, as
provided in Section 1003) have been delivered to the Trustee
for cancellation; or
(ii) all Securities of such series and, in the
case of (A) or (B) below, any coupons appertaining thereto not
theretofore delivered to the Trustee for cancellation
(A) have become due and payable,
(B) will become due and payable at their Stated
Maturity within one year, or
(C) if redeemable at the option of PCS, are to be
called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense,
of PCS,
and PCS, in the case of (A), (B) or (C) above, has irrevocably
deposited or caused to be deposited with the Trustee as trust
funds in trust for the purpose an amount in the currency or
currencies, currency unit or units or composite currency or
currencies in which Securities of such series are payable,
sufficient to pay and discharge the entire indebtedness on
such Securities and such coupons not theretofore delivered to
the Trustee for cancellation, for principal (and premium, if
any) and interest, and any Additional Amounts with respect
thereto, to the date of such deposit (in the case of
Securities which have become due and payable) or to the Stated
Maturity or Redemption Date, as the case may be;
(b) PCS has paid or caused to be paid all other sums
payable hereunder by PCS; and
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(c) PCS has delivered to the Trustee an Officer's Certificate
and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this
Indenture as to such series have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of PCS to the Trustee and any predecessor Trustee under Section 606,
the obligations of PCS to any Authenticating Agent under Section 611 and, if
money shall have been deposited with and held by the Trustee pursuant to
subclause (ii) of clause (a) of this Section 401, the obligations of the Trustee
under Section 402 and the last paragraph of Section 1003 shall survive.
SECTION 402. Application of Trust Funds. Subject to the
provisions of the last paragraph of Section 1003, all money deposited with the
Trustee pursuant to Section 401 shall be held in trust and applied by it, in
accordance with the provisions of the Securities, the coupons and this
Indenture, to the payment either directly or through any Paying Agent (including
PCS acting as its own Paying Agent) as the Trustee may determine, to the Persons
entitled thereto, of the principal (and premium, if any) and any interest and
Additional Amounts for whose payment such money has been deposited with or
received by the Trustee, but such money need not be segregated from other funds
except to the extent required by law.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default. "Event of Default," wherever
used herein with respect to any particular series of Securities, means any one
of the following events (whatever the reason for such Event of Default and
whether or not 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 interest upon or any
Additional Amounts payable in respect of any Security of that series or
of any coupon appertaining thereto, when such interest, Additional
Amounts or coupon becomes due and payable, and continuance of such
default for a period of 30 days;
(b) default in the payment of the principal of (or premium, if
any) any Security of that series when due;
(c) default in the deposit of any sinking fund payment, when
and as due by the terms of any Security of that series and Article
Twelve;
(d) default in the performance, or breach, of any covenant or
warranty of PCS in this Indenture with respect to any Security of that
series (other than a covenant or warranty a
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default in whose performance or whose breach is elsewhere in this
Section 501 specifically dealt with), and continuance of such default
or breach for a period of 60 days after there has been given, by
registered or certified mail, to PCS by the Trustee or to PCS and the
Trustee by the Holders of at least 25% in principal amount of
Outstanding Securities of that series a written notice specifying such
default or breach and requiring it to be remedied and stating that such
notice is a "Notice of Default" hereunder;
(e) default under any bond, debenture, note or other evidence
of indebtedness for money borrowed by PCS (including obligations under
leases required to be capitalized on the balance sheet of the lessee
under GAAP, but not including any indebtedness or obligations for which
recourse is limited to property purchased) in an aggregate principal
amount in excess of $50,000,000 or under any mortgage, indenture or
instrument under which there may be issued or by which there may be
secured or evidenced any indebtedness for money borrowed by PCS
(including such leases but not including such indebtedness or
obligations for which recourse is limited to property purchased) in an
aggregate principal amount in excess of $50,000,000 by PCS, whether
such indebtedness now exists or shall hereafter be created, which
default shall have resulted in such indebtedness becoming or being
declared due and payable prior to the date on which it would otherwise
have become due and payable or such obligations being accelerated,
without such acceleration having been rescinded or annulled;
(f) PCS or any Significant Subsidiary pursuant to or within
the meaning of any Bankruptcy Law:
(i) commences a voluntary case or proceeding,
(ii) consents to the entry of an order for relief
against it in an involuntary case or proceeding,
(iii) consents to the appointment of a Custodian
of it or for all or a majority of its property,
(iv) makes a general assignment for the benefit
of its creditors or files a proposed or other scheme of
arrangement involving the rescheduling or composition of its
indebtedness,
(v) files a petition in bankruptcy or an answer
or consent seeking reorganization or relief, or
(vi) consents to the filing of such petition in
bankruptcy;
(g) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
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(i) is for relief against PCS or any Significant
Subsidiary in an involuntary case,
(ii) appoints a Custodian of PCS or any
Significant Subsidiary or for all or a majority of either of
its property, or
(iii) orders the liquidation, winding up,
dissolution or reorganization of PCS or any Significant
Subsidiary,
and the order or decree remains unstayed and in effect for 90 days; or
(h) a Custodian is appointed out of court with respect
to PCS, or with respect to all or a majority of the property of PCS, or any
encumbrancer shall take possession of all or a majority of the property of
PCS; or
(i) any other Event of Default provided with respect to
Securities of that series.
As used in this Section 501, the term "Bankruptcy Law" means Title 11, U.S.
Code, the Bankruptcy and Insolvency Act (Canada) or any similar Canadian or
United States Federal, State or provincial law or the law of any other
jurisdiction relating to bankruptcy, insolvency, winding up, liquidation,
reorganization or for the relief of debtors, and the term "Custodian" means any
receiver, trustee, assignee, liquidator or other similar official under any
Bankruptcy Law.
SECTION 502. Acceleration of Maturity; Rescission and
Annulment. If an Event of Default with respect to Securities of any series at
the time Outstanding occurs and is continuing, then and in every such case the
Trustee or the Holders of not less than 25% in principal amount of Outstanding
Securities of that series may declare the principal (or, if any Securities are
Original Issue Discount Securities or Indexed Securities, such portion of the
principal as may be specified in the terms thereof) of all Securities of that
series to be due and payable immediately, by a notice in writing to PCS (and to
the Trustee if given by the Holders), and upon any such declaration such
principal or specified portion thereof shall become immediately due and payable.
At any time after such a declaration of acceleration with
respect to Securities of any series has been made and before a judgment or
decree for payment of the money due has been obtained by the Trustee as
hereinafter in this Article Five provided, the Holders of a majority in
principal amount of Outstanding Securities of that series, by written notice to
PCS and the Trustee, may rescind and annul such declaration and its consequences
if:
(a) PCS has paid or deposited with the Trustee a sum
sufficient to pay in the currency or currency unit or composite
currency in which Securities of such series are payable (except as
otherwise specified pursuant to Section 301 for Securities of such
series):
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(i) all overdue installments of interest on and
any Additional Amounts payable in respect of all Outstanding
Securities of that series and any related coupons,
(ii) the principal of (and premium, if any) any
Outstanding Securities of that series which have become due
otherwise than by such declaration of acceleration and
interest thereon at the rate or rates borne by or provided for
in such Securities,
(iii) to the extent that payment of such interest
is lawful, interest upon overdue installments of interest and
any Additional Amounts at the rate or rates borne by or
provided for in such Securities, and
(iv) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel; and
(b) all Events of Default with respect to Securities of that
series, other than the nonpayment of the principal of (or premium, if
any) or interest on Securities of that series which have become due
solely by such declaration of acceleration, have been cured or waived
as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for
Enforcement by Trustee. PCS covenants that if:
(a) default is made in the payment of any installment of
interest or Additional Amounts, if any, on any Security of any series
and any related coupon when such interest or Additional Amount becomes
due and payable and such default continues for a period of 30 days, or
(b) default is made in the payment of the principal of (or
premium, if any) any Security of any series at its Maturity,
then PCS will, upon demand of the Trustee, pay to the Trustee, for the benefit
of the Holders of such Securities of such series and coupons, the whole amount
then due and payable on such Securities and coupons for principal (and premium,
if any) and interest and Additional Amounts, with interest upon any overdue
principal (and premium, if any) and, to the extent that payment of such interest
shall be legally enforceable, upon any overdue installments of interest or
Additional Amounts, if any, at the rate or rates borne by or provided for in
such Securities, and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
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If PCS fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against PCS or any other obligor upon such Securities of such series and collect
the moneys adjudged or decreed to be payable in the manner provided by law out
of the property of PCS or any other obligor upon such Securities of such series,
wherever situated.
If an Event of Default with respect to Securities of any
series occurs and is continuing, the Trustee may in its discretion proceed to
protect and enforce its rights and the rights of the Holders of Securities of
such series and any related coupons by such appropriate judicial proceedings as
the Trustee shall deem most effectual to protect and enforce any such rights,
whether for the specific enforcement of any covenant or agreement in this
Indenture or in aid of the exercise of any power granted herein, or to enforce
any other proper remedy.
SECTION 504. Trustee May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to PCS or any other obligor upon Securities or the property
of PCS or of such other obligor or their creditors, the Trustee (irrespective of
whether the principal of 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 on PCS for the payment of overdue
principal, premium, if any, or interest) shall be entitled and empowered, by
intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount, or such
lesser amount as may be provided for in Securities of such series, of
principal (and premium, if any) and interest and Additional Amounts, if
any, owing and unpaid in respect of Securities 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 the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel) and of the Holders allowed in such judicial
proceeding, and
(b) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator (or
other similar official) in any such judicial proceeding is hereby authorized by
each Holder of Securities of such series to make such payments to the Trustee,
and in the event that the Trustee shall consent to the making of such payments
directly to the Holders, to pay to the Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Trustee and
any predecessor Trustee, their agents and counsel, and any other amounts due the
Trustee or any predecessor Trustee under Section 606.
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Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder of
a Security or coupon any plan of reorganization, arrangement, adjustment or
composition affecting Securities or coupons or the rights of any Holder thereof,
or to authorize the Trustee to vote in respect of the claim of any Holder of a
Security or coupon in any such proceeding.
SECTION 505. Trustee May Enforce Claims Without Possession of
Securities or Coupons. All rights of action and claims under this Indenture or
any Securities or coupons may be prosecuted and enforced by the Trustee without
the possession of any Securities or coupons or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the Holders of Securities and coupons
in respect of which such judgment has been recovered.
SECTION 506. Application of Money Collected. Any money
collected by the Trustee pursuant to this Article Five shall be applied in the
following order, at the date or dates fixed by the Trustee and, in case of the
distribution of such money on account of principal (or premium, if any) or
interest and any Additional Amounts, upon presentation of Securities or coupons,
or both, as the case may be, and the notation thereon of the payment if only
partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee and any
predecessor Trustee under Section 606;
SECOND: To the payment of the amounts then due and unpaid upon
Securities and coupons for principal (and premium, if any) and interest
and any Additional Amounts payable, in respect of which or for the
benefit of which such money has been collected, ratably, without
preference or priority of any kind, according to the aggregate amounts
due and payable on such Securities and coupons for principal (and
premium, if any), interest and Additional Amounts, respectively; and
THIRD: To the payment of the remainder, if any, to PCS.
SECTION 507. Limitation on Suits. No Holder of any Security of
any series or any related coupon shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless:
(a) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to Securities of
that series;
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(b) the Holders of not less than 25% in principal amount of
Outstanding Securities of that series shall have made written request
to the Trustee to institute proceedings in respect of such Event of
Default in its own name as Trustee hereunder;
(c) such Holder or Holders have offered to the Trustee
indemnity reasonably satisfactory to the Trustee against the costs,
expenses and liabilities to be incurred in compliance with such
request;
(d) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(e) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of a
majority in principal amount of Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all such
Holders.
SECTION 508. Unconditional Right of Holders to Receive
Principal, Premium, if any, Interest and Additional Amounts. Notwithstanding any
other provision in this Indenture, the Holder of any Security or coupon shall
have the right which is absolute and unconditional to receive payment of the
principal of (and premium, if any) and, subject to Sections 305 and 307,
interest on, and any Additional Amounts in respect of, such Security or payment
of such coupon on the respective due dates expressed in such Security or coupon
(or, in the case of redemption, on the Redemption Date) and to institute suit
for the enforcement of any such payment, and such rights shall not be impaired
without the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies. If the
Trustee or any Holder of a Security or coupon has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, PCS, the Trustee and
the Holders of Securities and coupons shall, subject to any determination in
such proceeding, be restored severally and respectively to their former
positions hereunder and thereafter all rights and remedies of the Trustee and
the Holders shall continue as though no such proceeding had been instituted.
SECTION 510. Rights and Remedies Cumulative. Except as
otherwise provided with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Securities or coupons in the last paragraph of Section
306, 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
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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.
SECTION 511. Delay or Omission Not Waiver. No delay or
omission of the Trustee or of any Holder of any Security or coupon to exercise
any right or remedy accruing upon any Event of Default shall impair any such
right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article Five or by
law to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders of Securities
or coupons, as the case may be.
SECTION 512. Control by Holders of Securities. The Holders of
not less than a majority in principal amount of Outstanding Securities of any
series shall have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on the Trustee with respect to Securities of such series,
provided that
(a) such direction shall not be in conflict with any rule of
law or with this Indenture,
(b) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction, and
(c) the Trustee need not take any action which might involve
it in personal liability or be unduly prejudicial to the Holders of
Securities of such series not joining therein.
SECTION 513. Waiver of Past Defaults. The Holders of not less
than a majority in principal amount of Outstanding Securities of any series may
on behalf of the Holders of all Securities of such series and any related
coupons waive any past default hereunder with respect to such series and its
consequences, except a default
(a) in the payment of the principal of (or premium, if any) or
interest on or Additional Amounts payable in respect of any Security of
such series or any related coupons, or
(b) in respect of a covenant or provision hereof which under
Article Nine cannot be modified or amended without the consent of the
Holder of each Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.
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SECTION 514. Waiver of Usury, Stay or Extension Laws. PCS
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim, or take the
benefit or advantage of, any usury, stay or extension law wherever enacted, now
or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and PCS (to the extent that it may lawfully do
so) hereby expressly waives all benefit or advantage of any such law, and
covenants that it will not hinder, delay or impede the execution of any power
herein granted to the Trustee, but will suffer and permit the execution of every
such power as though no such law had been enacted.
SECTION 515. Undertaking for Costs. All parties to this
Indenture agree, and each Holder of any Security 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 or omitted by it as Trustee, the
filing by any party litigant in such suit of any 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 515 shall not apply to
any suit instituted by the Trustee, to any suit instituted by any Holder, or
group of Holders, holding in the aggregate more than 10% in principal amount of
Outstanding Securities, or to any suit instituted by any Holder for the
enforcement of the payment of the principal of (or premium, if any) or interest
on any Security on or after the respective Stated Maturities expressed in such
Security (or, in the case of redemption, on or after the Redemption Date).
ARTICLE SIX
THE TRUSTEE
SECTION 601. Notice of Defaults. Within 90 days after the
occurrence of any default hereunder with respect to Securities of any series,
the Trustee shall transmit in the manner and to the extent provided in TIA
Section 313(c), notice of such default hereunder known to the Trustee, unless
such default shall have been cured or waived; provided, however, that, except in
the case of a default in the payment of the principal of (or premium, if any) or
interest on or any Additional Amounts with respect to any Security of such
series, or in the payment of any sinking fund installment with respect to
Securities of such series, the Trustee shall be protected in withholding such
notice if and so long as Responsible Officers of the Trustee in good faith
determine that the withholding of such notice is in the interests of the Holders
of Securities and coupons of such series; and provided further that in the case
of any default or breach of the character specified in Section 501(d) with
respect to Securities and coupons of such series, no such notice to Holders
shall be given until at least 60 days after the occurrence thereof. For the
purpose of this Section 601, the term "default" means any event which is, or
after notice or lapse of time or both would become, an Event of Default with
respect to Securities of such series.
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SECTION 602. Certain Rights of Trustee. Subject to the
provisions of TIA Section 315(a) through 315(d):
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, coupon 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 or direction of PCS mentioned herein shall be
sufficiently evidenced by a PCS Request or PCS Order (other than
delivery of any Security, together with any coupons appertaining
thereto, to the Trustee for authentication and delivery pursuant to
Section 303 which shall be sufficiently evidenced as provided therein)
and any resolution of the Board of Directors may be sufficiently
evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically prescribed) may,
in the absence of bad faith on its part, rely upon an Officer's
Certificate;
(d) the Trustee may consult with counsel and the advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request
or direction of any of the Holders of Securities of any series or any
related coupons pursuant to this Indenture, unless such Holders shall
have offered to the Trustee security or indemnity reasonably
satisfactory to the Trustee against the costs, expenses and liabilities
which might be incurred by it in compliance with such request or
direction;
(f) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, coupon or other paper or
document, but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit,
and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to make reasonable examination of
the books, records and premises of PCS, personally or by agent or
attorney following reasonable notice to PCS;
(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 and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder; and
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(h) the Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and reasonably believed by it
to be authorized or within the discretion or rights or powers conferred
upon it by this Indenture.
The Trustee shall not be required to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of
its duties hereunder, or in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it.
Except during the continuance of an Event of Default, the
Trustee undertakes to perform only such duties as are specifically set forth in
this Indenture, and no implied covenants or obligations shall be read into this
Indenture against the Trustee.
SECTION 603. Not Responsible for Recitals or Issuance of
Securities. The recitals contained herein and in the Securities, except the
Trustee's certificate of authentication, and in any coupons shall be taken as
the statements of PCS, and neither the Trustee nor any Authenticating Agent
assumes any responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of
Securities or coupons, except that the Trustee represents that it is duly
authorized to execute and deliver this Indenture, authenticate Securities and
perform its obligations hereunder and that the statements made by it in a
Statement of Eligibility on Form T-1 supplied to PCS are true and accurate,
subject to the qualifications set forth therein. Neither the Trustee nor any
Authenticating Agent shall be accountable for the use or application by PCS of
Securities or the proceeds thereof.
SECTION 604. May Hold Securities. The Trustee, any Paying
Agent, Security Registrar, Authenticating Agent or any other agent of PCS, in
its individual or any other capacity, may become the owner or pledgee of
Securities and coupons and, subject to TIA Sections 310(b) and 311, may
otherwise deal with PCS with the same rights it would have if it were not
Trustee, Paying Agent, Security Registrar, Authenticating Agent or such other
agent.
SECTION 605. Money Held in Trust. Money held by the Trustee in
trust hereunder need not be segregated from other funds except to the extent
required by law. The Trustee shall be under no liability for interest on any
money received by it hereunder except as otherwise agreed with PCS.
SECTION 606. Compensation and Reimbursement. PCS agrees:
(a) to pay to the Trustee from time to time compensation
agreed to with the Trustee for all services rendered by it hereunder
(which compensation shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust);
(b) except as otherwise expressly provided herein, to
reimburse each of the Trustee and any predecessor Trustee upon its
request for all reasonable expenses, disbursements and
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advances incurred or made by the Trustee in accordance with any
provision of this Indenture (including the reasonable compensation and
the expenses and disbursements of its agents and counsel), except any
such expense, disbursement or advance as may be attributable to its
negligence or bad faith; and
(c) to indemnify each of the Trustee and any predecessor
Trustee for, and to hold it harmless against, any loss, liability or
expense incurred without negligence or bad faith on its own part,
arising out of or in connection with the acceptance or administration
of the trust or trusts hereunder, including the costs and expenses of
defending itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder.
When the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Sections 501(f) or 501(g), the
expenses (including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.
As security for the performance of the obligations of PCS
under this Section 606, the Trustee shall have a lien prior to the Securities
upon all property and funds held or collected by the Trustee as such, except
funds held in trust for the payment of principal of (or premium, if any) or
interest on or any Additional Amounts with respect to any particular Securities
or any coupons.
The provisions of this Section 606 shall survive the
termination of this Indenture.
SECTION 607. Corporate Trustee Required; Eligibility;
Conflicting Interests. There shall at all times be a Trustee hereunder which
shall be eligible to act as Trustee under TIA Section 310(a)(1) and shall have a
combined capital and surplus of at least $50,000,000, which in the case of the
Trustee named in the first paragraph of this Indenture shall mean that (a) the
combined capital and surplus of such Trustee plus (b) the combined capital and
surplus of any Corporation of which such Trustee is a Wholly Owned Subsidiary
shall be at least $50,000,000. If such corporation publishes reports of
condition at least annually, pursuant to law or the requirements of Federal,
State, Territorial or District of Columbia 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. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section,
it shall resign immediately in the manner and with the effect hereinafter
specified in this Article Six. If the Trustee has or shall acquire a
conflicting interest within the meaning of TIA Section 310(b), the Trustee
shall either eliminate such interest or resign, to the extent and in the manner
provided by, and subject to the provisions of, the TIA and this Indenture.
SECTION 608. Resignation and Removal; Appointment of
Successor. (a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article Six shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 609.
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(b) The Trustee may resign at any time with respect to
Securities of one or more series by giving written notice thereof to PCS. If an
instrument of acceptance by a successor Trustee shall not have been delivered to
the Trustee within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(c) The Trustee may be removed at any time with respect to
Securities of any series by Act of the Holders of a majority in principal amount
of Outstanding Securities of such series delivered to the Trustee and to PCS.
(d) If at any time:
(i) the Trustee shall fail to comply with the
provisions of TIA Section 310(b) after written request therefor by PCS
or by any Holder of a Security who has been a bona fide Holder of a
Security for at least six months,
(ii) the Trustee shall cease to be eligible under
Section 607 and shall fail to resign after written request therefor by
PCS or by any Holder of a Security who has been a bona fide Holder of a
Security for at least six months, or
(iii) the Trustee shall become incapable of acting or
shall be adjudged a bankrupt or insolvent or a receiver of the Trustee
or of its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation,
then, in any such case, (i) PCS by or pursuant to a Board Resolution may remove
the Trustee and appoint a successor Trustee with respect to all Securities, or
(ii) subject to TIA Section 315(e), any Holder of a Security who has been a bona
fide Holder of a Security for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the removal of the Trustee with respect to all Securities and the appointment of
a successor Trustee or Trustees.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any cause with respect to Securities of one or more series, PCS, by or pursuant
to a Board Resolution, shall promptly appoint a successor Trustee or Trustees
with respect to Securities of that or those series (it being understood that any
such successor Trustee may be appointed with respect to Securities of one or
more or all of such series and that at any time there shall be only one Trustee
with respect to Securities of any particular series). If, within one year after
such resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to Securities of any series shall be appointed by
Act of the Holders of a majority in principal amount of Outstanding Securities
of such series delivered to PCS and the retiring Trustee, the successor Trustee
so appointed shall, forthwith upon its acceptance of such appointment, become
the successor Trustee with respect to Securities of such series and to that
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extent supersede the successor Trustee appointed by PCS. If no successor Trustee
with respect to Securities of any series shall have been so appointed by PCS or
the Holders of Securities and accepted appointment in the manner hereinafter
provided, any Holder of a Security who has been a bona fide Holder of a Security
of such series for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to Securities of such series.
Any resigning or removed Trustee shall be entitled to all benefits, indemnities,
exculpations and protections available to it as Trustee as to any actions taken
or omitted to be taken by it while it was Trustee under this Indenture.
(f) PCS shall give notice of each resignation and each removal
of the Trustee with respect to Securities of any series and each appointment of
a successor Trustee with respect to Securities of any series in the manner
provided for notices to the Holders of Securities in Section 106. Each notice
shall include the name of the successor Trustee with respect to Securities of
such series and the address of its Corporate Trust Office.
SECTION 609. Acceptance of Appointment by Successor. (a) In
case of the appointment hereunder of a successor Trustee with respect to all
Securities, every such successor Trustee shall execute, acknowledge and deliver
to PCS and to the retiring Trustee an instrument accepting such appointment, and
thereupon the resignation or removal of the retiring Trustee shall become
effective and such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee; but, on request of PCS or the successor Trustee, such
retiring Trustee shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Trustee all the rights, powers and
trusts of the retiring Trustee, and shall duly assign, transfer and deliver to
such successor Trustee all property and money held by such retiring Trustee
hereunder, subject nevertheless to its claim, if any, provided for in Section
606.
(b) In case of the appointment hereunder of a successor
Trustee with respect to Securities of one or more (but not all) series, PCS, the
retiring Trustee and each successor Trustee with respect to Securities of one or
more series shall execute and deliver an indenture supplemental hereto, pursuant
to Article Nine, wherein each successor Trustee shall accept such appointment
and which (i) shall contain such provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, each successor Trustee all the
rights, powers, trusts and duties of the retiring Trustee with respect to
Securities of that or those series to which the appointment of such successor
Trustee relates, (ii) if the retiring Trustee is not retiring with respect to
all Securities, shall contain such provisions as shall be deemed necessary or
desirable to confirm that all the rights, powers, trusts and duties of the
retiring Trustee with respect to Securities of that or those series as to which
the retiring Trustee is not retiring shall continue to be vested in the retiring
Trustee, and (iii) shall add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the administration
of the trusts hereunder by more than one Trustee, it being understood that
nothing herein or in such supplemental indenture shall constitute such Trustees
co-trustees of the same trust and that each such Trustee shall be trustee of a
trust or trusts hereunder separate and apart from any trust or trusts hereunder
administered by any other such Trustee; and upon the execution and delivery
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of such supplemental indenture the resignation or removal of the retiring
Trustee shall become effective to the extent provided therein and each such
successor Trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring Trustee
with respect to Securities of that or those series to which the appointment of
such successor Trustee relates; but, on request of PCS or any successor Trustee,
such retiring Trustee shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder with
respect to Securities of that or those series to which the appointment of such
successor Trustee relates.
(c) Upon request of any such successor Trustee, PCS shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred
to in paragraph (a) or (b) of this Section 609, as the case may be.
(d) No successor Trustee shall accept its appointment unless
at the time of such acceptance such successor Trustee shall be qualified and
eligible under this Article Six.
SECTION 610. Merger, Conversion, Consolidation or Succession
to Business. Any corporation into which the Trustee may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article Six, without the execution or filing of any paper or any further act on
the part of any of the parties hereto. In case any Securities or coupons shall
have been authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such authentication and deliver Securities or coupons so authenticated
with the same effect as if such successor Trustee had itself authenticated such
Securities or coupons. In case any Securities or coupons shall not have been
authenticated by such predecessor Trustee, any such successor Trustee may
authenticate and deliver such Securities or coupons, in either its own name or
that of its predecessor Trustee, with the full force and effect which this
Indenture provides for the certificate of authentication of the Trustee.
SECTION 611. Appointment of Authenticating Agent. At any time
when any Securities remain Outstanding, the Trustee may appoint an
Authenticating Agent or Agents with respect to one or more series of Securities
which shall be authorized to act on behalf of the Trustee to authenticate
Securities of such series issued upon exchange, registration of transfer or
partial redemption or repayment thereof, and Securities so authenticated shall
be entitled to the benefits of this Indenture and shall be valid and obligatory
for all purposes as if authenticated by the Trustee hereunder. Any such
appointment shall be evidenced by an instrument in writing signed by a
Responsible Officer of the Trustee, a copy of which instrument shall be promptly
furnished to PCS and the Trustee shall give written notice of such appointment
to all Holders of Securities of the series with respect to which such
Authenticating Agent will serve in the manner provided for in Section 106.
Wherever reference is made in this Indenture to the authentication and delivery
of Securities by the Trustee or the Trustee's certificate of authentication,
such reference shall be deemed to include
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authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to PCS and
shall at all times be a bank or trust company or corporation organized and doing
business and in good standing under the laws of the United States of America or
of any State or the District of Columbia, authorized under such laws to act as
Authenticating Agent, subject to supervision or examination by Federal or State
authorities and having a combined capital and surplus of at least $50,000,000.
If such Authenticating Agent publishes reports of condition at least annually,
pursuant to law or the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section 611, the combined capital and
surplus of such Authenticating Agent shall be deemed to be its combined capital
and surplus as set forth in its most recent report of condition so published. In
case at any time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section 611, such Authenticating Agent
shall resign immediately in the manner and with the effect specified in this
Section 611.
Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section 611, without the execution or filing of
any paper or further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent for any series of Securities may at
any time resign by giving written notice of resignation to the Trustee for such
series and to PCS. The Trustee for any series of Securities may at any time
terminate the agency of an Authenticating Agent by giving written notice of
termination to such Authenticating Agent and to PCS. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 611, the Trustee for such series may appoint a
successor Authenticating Agent which shall be acceptable to PCS and shall give
notice of such appointment to all Holders of Securities of the series with
respect to which such Authenticating Agent will serve in the manner set forth in
Section 106. Any successor Authenticating Agent upon acceptance of its
appointment hereunder shall become vested with all the rights, powers and duties
of its predecessor hereunder, with like effect as if originally named as an
Authenticating Agent herein. No successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section 611.
PCS agrees to pay to each Authenticating Agent from time to
time reasonable compensation including reimbursement of its reasonable expenses
for its services under this Section 611.
If an appointment with respect to one or more series is made
pursuant to this Section 611, Securities of such series may have endorsed
thereon, in addition to or in lieu of the Trustee's
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certificate of authentication, an alternate certificate of authentication
substantially in the following form:
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
--------------------------------------------
as Trustee
By: ,
----------------------------
as Authenticating Agent
By:
----------------------------
Authorized Signatory
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND PCS
SECTION 701. Disclosure of Names and Addresses of Holders.
Every Holder of Securities or coupons, by receiving and holding the same, agrees
with PCS and the Trustee that neither PCS nor the Trustee nor any Authenticating
Agent nor any Paying Agent nor any Security Registrar shall be held accountable
by reason of the disclosure of any information as to the names and addresses of
the Holders of Securities in accordance with TIA Section 312 or any statute of
Canada or any province or territory thereof, 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
TIA Section 312(b).
SECTION 702. Reports by Trustee. Within 60 days after [June 1]
of each year commencing with the first [June 1] after the first issuance of
Securities pursuant to this Indenture, the Trustee shall transmit by mail to all
Holders of Securities as provided in TIA Section 313(c) a brief report dated as
of such June 1 if required by TIA Section 313(a).
SECTION 703. Reports by PCS. PCS will:
(a) file with the Trustee, within 15 days after PCS 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 PCS may be
required to file with the
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Commission pursuant to Section 13 or Section 15(d) of the Exchange Act;
or, if PCS is not required to file information, documents or reports
pursuant to either of such Sections, then it will file with the
Trustee, 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 security listed and
registered on a national securities exchange as may be prescribed from
time to time in such rules and regulations;
(b) 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 PCS with the conditions and covenants of this
Indenture as may be required from time to time by such rules and
regulations;
(c) transmit or cause to be transmitted 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 TIA Section
313(c), such summaries of any information, documents and reports
required to be filed by PCS pursuant to paragraphs (a) and (b) of this
Section 703 as may be required by rules and regulations prescribed from
time to time by the Commission; and
(d) file any report required by any statute of Canada or any
province or territory thereof.
SECTION 704. PCS to Furnish Trustee Names and Addresses of
Holders. PCS will furnish or cause to be furnished to the Trustee:
(a) semi-annually, not later than 15 days after the Regular
Record Date for interest for each series of Securities, a list, in such form as
the Trustee may reasonably require, of the names and addresses of the Holders of
Registered Securities of such series as of such Regular Record Date, or if there
is no Regular Record Date for interest for such series of Securities,
semi-annually, upon such dates as are set forth in the Board Resolution or
indenture supplemental hereto authorizing such series, and
(b) at such other times as the Trustee may request in writing,
within 30 days after the receipt by PCS of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such list
is furnished,
provided, however, that, so long as the Trustee is the Security Registrar, no
such list shall be required to be furnished.
ARTICLE EIGHT
CONSOLIDATION, MERGER, SALE, LEASE OR CONVEYANCE
SECTION 801. Consolidations and Mergers of PCS and Sales,
Leases and Conveyances Permitted Subject to Certain Conditions. PCS may
amalgamate or consolidate with, or sell, lease or convey all or substantially
all of its assets to, or merge with or into any other
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corporation, provided that in any such case, (a) either PCS shall be the
continuing Corporation, or the successor Corporation (a "successor entity")
shall be a Corporation organized and existing under the laws of Canada or a
province or territory thereof or the United States or a State thereof or the
District of Columbia, and such successor entity shall expressly assume the due
and punctual payment of the principal of (and premium, if any) and any Interest
on all Securities, according to their tenor, and the due and punctual
performance and observance of all of the covenants and conditions of this
Indenture to be performed by PCS by supplemental indenture, complying with
Article Nine, satisfactory to the Trustee, executed and delivered to the Trustee
by such successor entity, and (b) immediately after giving effect to such
transaction and treating any indebtedness which becomes an obligation of PCS or
the successor entity as a result thereof as having been incurred by PCS or such
successor entity at the time of such transaction, no Event of Default, and no
event which, after notice or the lapse of time, or both, would become an Event
of Default, shall have occurred and be continuing.
SECTION 802. Rights and Duties of Successor Entity. In case of
any such consolidation, merger, sale, lease or conveyance and upon any such
assumption by the successor entity, such successor entity shall succeed to and
be substituted for PCS, with the same effect as if it had been named herein, and
the predecessor entity, except in the event of a lease, shall be relieved of any
further obligation under this Indenture and the Securities. Such successor
entity thereupon may cause to be signed, and may issue either in its own name or
in the name of PCS, any or all Securities issuable hereunder which theretofore
shall not have been signed by PCS and delivered to the Trustee; and, upon the
order of such successor entity, instead of PCS, 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 PCS to the Trustee for authentication,
and any Securities which such successor entity thereafter shall cause to be
signed and delivered to the Trustee for that purpose. All Securities so issued
shall in all respects have the same legal rank and benefit under this Indenture
as 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 Securities thereafter to be issued as may be appropriate.
SECTION 803. Securities to Be Secured in Certain Events. If,
upon any consolidation or amalgamation of PCS with or merger of PCS into any
other Person, or upon any conveyance, lease or transfer of the properties and
assets of PCS substantially as an entirety to any other Person, any of the
property and assets of PCS would thereupon become subject to any Lien, then
unless such Lien could be created pursuant to Section 1010 without equally and
ratably securing the Securities, PCS, prior to or simultaneously with such
consolidation, amalgamation, merger, conveyance, lease or transfer, will secure
Securities Outstanding hereunder (together with, if PCS shall so determine, any
other indebtedness of PCS now existing or hereafter created which is not
subordinate to such Securities) equally and ratably with (or prior to) the
indebtedness which upon such consolidation, amalgamation, merger, conveyance,
lease or transfer is to become secured by
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such Lien, or will cause such Securities to be so secured; provided that, for
the purpose of providing such equal and ratable security, the principal amount
of Original Issue Discount Securities and Indexed Securities shall mean that
amount which would at the time of making such effective provision be due and
payable pursuant to Section 502 and the terms of such Original Issue Discount
Securities and Indexed Securities upon a declaration of acceleration of the
Maturity thereof, and the extent of such equal and ratable security shall be
adjusted, to the extent permitted by law, as and when said amount changes over
time pursuant to the terms of such Original Issue Discount Securities and
Indexed Securities.
SECTION 804. Officer's Certificate and Opinion of Counsel. Any
consolidation, merger, sale, lease or conveyance permitted under Section 801 is
also subject to the condition that the Trustee receive an Officer's Certificate
and an Opinion of Counsel to the effect that any such consolidation, merger,
sale, lease or conveyance, and the assumption by any successor entity, complies
with the provisions of this Article Eight and that all conditions precedent
herein provided for relating to such transaction have been complied with.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures without Consent of
Holders. Without the consent of any Holders of Securities or coupons, PCS, when
authorized by or pursuant to a Board Resolution, and the Trustee, at any time
and from time to time, may enter into one or more indentures supplemental
hereto, in form satisfactory to the Trustee, for any of the following purposes:
(a) to evidence the succession of another Person to PCS and
the assumption by any such successor of the covenants of PCS contained
herein and in the Securities;
(b) to add to the covenants of PCS for the benefit of the
Holders of all or any series of Securities and any related coupons (and
if such covenants are to be for the benefit of less than all series of
Securities, stating that such covenants are expressly being included
solely for the benefit of such series) or to surrender any right or
power herein conferred upon PCS;
(c) to add any additional Events of Default for the benefit of
the Holders of all or any series of Securities (and if such Events of
Default are to be for the benefit of less than all series of
Securities, stating that such Events of Default are expressly being
included solely for the benefit of such series); provided, however,
that in respect of any such additional Events of Default 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 default or may limit the remedies available to
the Trustee upon such default or may limit the right of the Holders of
a majority
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in aggregate principal amount of that or those series of Securities to
which such additional Events of Default apply to waive such default;
(d) to add to or change any of the provisions of this
Indenture to provide that Bearer Securities may be registrable as to
principal, to change or eliminate any restrictions on the payment of
principal of (or premium, if any) or interest on Bearer Securities, to
permit Bearer Securities to be issued in exchange for Registered
Securities, to permit Bearer Securities to be issued in exchange for
Bearer Securities of other authorized denominations or to permit or
facilitate the issuance of Securities in uncertificated form, provided
that any such action shall not adversely affect the interests of the
Holders of Securities of any series or any related coupons in any
material respect;
(e) to change or eliminate any of the provisions of this
Indenture, provided that any such change or elimination shall become
effective only when there is no Security Outstanding of any series
created prior to the execution of such supplemental indenture which is
entitled to the benefit of such provision;
(f) to secure Securities pursuant to the requirements of
Section 803 or 1010 or otherwise;
(g) to establish the form or terms of Securities of any series
and any related coupons as permitted by Sections 201 and 301, including
the provisions and procedures relating to Securities convertible into
Common Shares or Preferred Shares, as the case may be;
(h) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to 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;
(i) to cure any ambiguity, to correct or supplement any
provision herein which may be defective or inconsistent with any other
provision herein, or to make any other provisions with respect to
matters or questions arising under this Indenture which shall not be
inconsistent with the provisions of this Indenture, provided such
provisions shall not adversely affect the interests of the Holders of
Securities of any series or any related coupons in any material
respect; or
(j) to supplement any of the provisions of this Indenture to
such extent as shall be necessary to permit or facilitate the
defeasance and discharge of any series of Securities pursuant to
Sections 401, 1402 and 1403; provided that any such action shall not
adversely affect the interests of the Holders of Securities of such
series and any related coupons or any other series of Securities in any
material respect.
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SECTION 902. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority in principal amount
of all Outstanding Securities affected by such supplemental indenture, by Act of
said Holders delivered to PCS and the Trustee, PCS, when authorized by or
pursuant to a Board Resolution, and the Trustee may enter into an indenture or
indentures supplemental hereto for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Indenture or
of modifying in any manner the rights of the Holders of Securities and any
related coupons under this Indenture; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Security affected thereby:
(a) change the Stated Maturity of the principal of (or
premium, if any) or any installment of principal of or interest on, any
Security; or reduce the principal amount thereof or the rate or amount
of interest thereon or any Additional Amounts payable in respect
thereof, or any premium payable upon the redemption thereof, or change
any obligation of PCS to pay Additional Amounts pursuant to Section
1009 (except as contemplated by Section 801(a) and permitted by Section
901(a)), or reduce the amount of the principal of an Original Issue
Discount Security that would be due and payable upon a declaration of
acceleration of the Maturity thereof pursuant to Section 502 or the
amount thereof provable in bankruptcy pursuant to Section 504, or
adversely affect any right of repayment at the option of the Holder of
any Security, or change any Place of Payment where, or the currency or
currencies, currency unit or units or composite currency or currencies
in which, any Security or any premium or the interest thereon is
payable, or impair the right to institute suit for the enforcement of
any such payment on or after the Stated Maturity thereof (or, in the
case of redemption or repayment at the option of the Holder, on or
after the Redemption Date or the Repayment Date, as the case may be),
or adversely affect any right to convert or exchange any Security as
may be provided pursuant to Section 301,
(b) reduce the percentage in principal amount of Outstanding
Securities of any series, the consent of whose Holders is required for
any such supplemental indenture, or the consent of whose Holders is
required for any waiver with respect to such series (or compliance with
certain provisions of this Indenture or certain defaults hereunder and
their consequences) provided for in this Indenture, or reduce the
requirements of Section 1504 for quorum or voting, or
(c) modify any of the provisions of this Section, Section 513
or Section 1012, except to increase the required percentage to effect
such action or to provide that certain other provisions of this
Indenture cannot be modified or waived without the consent of the
Holder of each Outstanding Security affected thereby.
It shall not be necessary for any Act of Holders under this
Section 902 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
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A supplemental indenture which changes or eliminates any
covenant or other provision of this Indenture which has expressly been included
solely for the benefit of one or more particular series of Securities, or which
modifies the rights of the Holders of Securities of such series with respect to
such covenant or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Securities of any other series.
SECTION 903. Execution of Supplemental Indentures. In
executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article Nine or the modification thereby of the
trusts created by this Indenture, the Trustee shall be entitled to receive, and
shall be fully protected in relying upon, an Opinion of Counsel stating that the
execution of such supplemental indenture is authorized or permitted by this
Indenture. The Trustee may, but shall not be obligated to, enter into any such
supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
SECTION 904. Effect of Supplemental Indentures. Upon the
execution of any supplemental indenture under this Article Nine, this Indenture
shall be modified in accordance therewith, and such supplemental indenture shall
form a part of this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder and of any
coupon appertaining thereto shall be bound thereby.
SECTION 905. Conformity with TIA. Every supplemental indenture
executed pursuant to this Article Nine shall conform to the requirements of the
TIA as then in effect.
SECTION 906. Reference in Securities to Supplemental
Indentures. Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall,
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If PCS shall so
determine, new Securities of any series so modified as to conform, in the
opinion of the Trustee and PCS, to any such supplemental indenture may be
prepared and executed by PCS and authenticated and delivered by the Trustee in
exchange for Outstanding Securities of such series.
SECTION 907. Notice of Supplemental Indentures. Promptly after
the execution by PCS and the Trustee of any supplemental indenture pursuant to
the provisions of Section 902, PCS shall give notice thereof to the Holders of
each Outstanding Security affected, in the manner provided for in Section 106,
setting forth in general terms the substance of such supplemental indenture.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium, if any, Interest
and Additional Amounts. PCS covenants and agrees for the benefit of the Holders
of each series of Securities that
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it will duly and punctually pay the principal of (and premium, if any) and
interest on and any Additional Amounts payable in respect of Securities of that
series in accordance with the terms of such series of Securities, any coupons
appertaining thereto and this Indenture. Unless otherwise specified as
contemplated by Section 301 with respect to any series of Securities, any
interest due on and any Additional Amounts payable in respect of Bearer
Securities on or before Maturity, other than Additional Amounts, if any, payable
as provided in Section 1009 in respect of principal of (or premium, if any) such
a Security, shall be payable only upon presentation and surrender of the several
coupons for such interest installments as are evidenced thereby as they
severally mature. Unless otherwise specified with respect to Securities of any
series pursuant to Section 301, at the option of PCS, all payments of principal
may be paid by check to the registered Holder of the Registered Security or
other person entitled thereto against surrender of such Security.
SECTION 1002. Maintenance of Office or Agency. If Securities
of a series are issuable only as Registered Securities, PCS shall maintain in
each Place of Payment for any series of Securities an office or agency where
Securities of that series may be presented or surrendered for payment or
conversion, where Securities of that series may be surrendered for registration
of transfer or exchange and where notices and demands to or upon PCS in respect
of Securities of that series and this Indenture may be served. If Securities of
a series are issuable as Bearer Securities, PCS will maintain: (a) in the
Borough of Manhattan, New York City, an office or agency where any Registered
Securities of that series may be presented or surrendered for payment or
conversion, where any Registered Securities of that series may be surrendered
for registration of transfer, where Securities of that series may be surrendered
for exchange, where notices and demands to or upon PCS in respect of Securities
of that series and this Indenture may be served and where Bearer Securities of
that series and related coupons may be presented or surrendered for payment or
conversion in the circumstances described in the following paragraph (and not
otherwise); (b) subject to any laws or regulations applicable thereto, in a
Place of Payment for that series which is located outside the United States, an
office or agency where Securities of that series and related coupons may be
presented and surrendered for payment (including payment of any Additional
Amounts payable on Securities of that series pursuant to Section 1009) or
conversion; provided, however, that if Securities of that series are listed on
the Luxembourg Stock Exchange or any other stock exchange located outside the
United States and such stock exchange shall so require, PCS will maintain a
Paying Agent for Securities of that series in Luxembourg or any other required
city located outside the United States, as the case may be, so long as
Securities of that series are listed on such exchange; and (c) subject to any
laws or regulations applicable thereto, in a Place of Payment for that series
located outside the United States an office or agency where any Registered
Securities of that series may be surrendered for registration of transfer, where
Securities of that series may be surrendered for exchange and where notices and
demands to or upon PCS in respect of Securities of that series and this
Indenture may be served. PCS will give prompt written notice to the Trustee of
the location, and any change in the location, of each such office or agency. If
at any time PCS shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee, except that Bearer Securities of that series and the
related coupons may be presented and surrendered for payment
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(including payment of any Additional Amounts payable on Bearer Securities of
that series pursuant to Section 1009) or conversion at the offices specified in
the Security, and PCS hereby appoints the Trustee as its agent to receive all
such presentations, surrenders, notices and demands.
Unless otherwise specified with respect to any Securities
pursuant to Section 301, no payment of principal, premium or interest on or
Additional Amounts in respect of Bearer Securities shall be made at any office
or agency of PCS in the United States or by check mailed to any address in the
United States or by transfer to an account maintained with a bank located in
the United States; provided, however, that, if Securities of a series are
payable in Dollars, payment of principal of and any premium and interest on any
Bearer Security (including any Additional Amounts payable on Securities of such
series pursuant to Section 1009) shall be made at the office of the designated
agent of PCS's Paying Agent in the Borough of Manhattan, New York City, if (but
only if) payment in Dollars of the full amount of such principal, premium,
interest or Additional Amounts, as the case may be, at all offices or agencies
outside the United States maintained for the purpose by PCS in accordance with
this Indenture, is illegal or effectively precluded by exchange controls or
other similar restrictions.
PCS may from time to time designate one or more other offices
or agencies where Securities of one or more series may be presented or
surrendered for any or all of such purposes, and may from time to time rescind
such designations; provided, however, that no such designation or rescission
shall in any manner relieve PCS of its obligation to maintain an office or
agency in accordance with the requirements set forth above for Securities of any
series for such purposes. PCS will give prompt written notice to the Trustee of
any such designation or rescission and of any change in the location of any such
other office or agency. Unless otherwise specified with respect to any
Securities pursuant to Section 301 with respect to a series of Securities, PCS
hereby designates as a Place of Payment for each series of Securities the office
or agency of PCS in the Borough of Manhattan, New York City, and initially
appoints the Trustee at its Corporate Trust Office as Paying Agent and as its
agent to receive all such presentations, surrenders, notices and demands.
Unless otherwise specified with respect to any Securities
pursuant to Section 301, if and so long as Securities of any series (a) are
denominated in a Foreign Currency or (b) may be payable in a Foreign Currency,
or so long as it is required under any other provision of the Indenture, then
PCS will maintain with respect to each such series of Securities, or as so
required, at least one exchange rate agent.
SECTION 1003. Money for Securities Payments to Be Held in
Trust. If PCS shall at any time act as its own Paying Agent with respect to any
series of any Securities and any related coupons, it will, on or before each due
date of the principal of (and premium, if any) or interest on or Additional
Amounts in respect of any Securities of that series, segregate and hold in trust
for the benefit of the Persons entitled thereto a sum in the currency or
currencies, currency unit or units or composite currency or currencies in which
Securities of such series are payable (except as otherwise specified pursuant to
Section 301 for Securities of such series) sufficient to pay the principal (and
premium, if any) or interest or Additional Amounts so becoming due until such
sums shall be paid to
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such Persons or otherwise disposed of as herein provided, and will promptly
notify the Trustee of its action or failure so to act.
Whenever PCS shall have one or more Paying Agents for any
series of Securities and any related coupons, it will, before each due date of
the principal of (and premium, if any) or interest on or Additional Amounts in
respect of any Securities of that series, deposit with a Paying Agent a sum (in
the currency or currencies, currency unit or units or composite currency or
currencies described in the preceding paragraph) sufficient to pay the principal
(and premium, if any) or interest or Additional Amounts, so becoming due, such
sum to be held in trust for the benefit of the Persons entitled to such
principal, premium or interest or Additional Amounts and (unless such Paying
Agent is the Trustee) PCS will promptly notify the Trustee of its action or
failure so to act.
PCS will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section 1003,
that such Paying Agent will
(a) hold all sums held by it for the payment of principal of
(and premium, if any) or interest on Securities or Additional Amounts
in trust for the benefit of the Persons entitled thereto until such
sums shall be paid to such Persons or otherwise disposed of as herein
provided;
(b) give the Trustee notice of any default by PCS (or any
other obligor upon Securities) in the making of any such payment of
principal (and premium, if any) or interest or Additional Amounts; and
(c) at any time during the continuance of any such default
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Paying Agent.
PCS may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by PCS Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by PCS or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by PCS or such Paying Agent;
and, upon such payment by any Paying Agent to the Trustee, such Paying Agent
shall be released from all further liability with respect to such sums.
Except as otherwise provided in Securities of any series, any
money deposited with the Trustee or any Paying Agent, or then held by PCS, in
trust for the payment of the principal of (and premium, if any) or interest on,
or any Additional Amounts in respect of, any Security of any series and
remaining unclaimed for two years after such principal (and premium, if any),
interest or Additional Amounts has become due and payable shall be paid to PCS
upon PCS Request or (if then held by PCS) shall be discharged from such trust;
and the Holder of such Security shall thereafter, as an unsecured general
creditor, look only to PCS for payment of such principal of (and premium, if
any) or interest on, or any Additional Amounts in respect of, any Security,
without interest thereon,
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and all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of PCS as trustee thereof, shall thereupon cease;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of PCS cause to be published
once, in an Authorized Newspaper, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less than 30 days from
the date of such publication, any unclaimed balance of such money then remaining
will be repaid to PCS.
SECTION 1004. Existence. Subject to Article Eight, PCS will do
or cause to be done all things necessary to preserve and keep in full force and
effect its existence as a corporation, rights (charter and statutory) and
franchises; provided, however, that PCS shall not be required to preserve any
right or franchise if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
PCS.
SECTION 1005. Maintenance of Properties. PCS will cause all of
its material properties used or useful in the conduct of its business or the
business of any Subsidiary to be maintained and kept in good condition, repair
and working order and supplied with all necessary equipment and will cause to be
made all necessary repairs, renewals, replacements, betterments and improvements
thereof, all as in the judgment of PCS may be necessary so that the business
carried on in connection therewith may be properly and advantageously conducted
at all times.
SECTION 1006. Insurance. PCS will, and will cause each of its
Subsidiaries to, keep all of its insurable properties insured against loss or
damage at least equal to their then full insurable value with insurers of
recognized responsibility.
SECTION 1007. Payment of Taxes and Other Claims. PCS will pay
or discharge or cause to be paid or discharged, before the same shall become
delinquent, (a) all taxes, assessments and governmental charges levied or
imposed upon it or any Subsidiary or upon the income, profits or property of PCS
or any Subsidiary, and (b) all lawful claims for labor, materials and supplies,
which, if unpaid, might by law become a Lien upon the property of PCS or any
Subsidiary; provided, however, that PCS shall not be required to pay or
discharge or cause to be paid or discharged any such tax, assessment, charge or
claim whose amount, applicability or validity is being contested in good faith
by appropriate proceedings.
SECTION 1008. Statement as to Compliance. PCS will deliver to
the Trustee, within 120 days after the end of each fiscal year, a brief
certificate from the principal executive officer, principal financial officer or
principal accounting officer as to his or her knowledge of PCS's compliance with
all conditions and covenants under this Indenture and, in the event of any
noncompliance, specifying such noncompliance and the nature and status thereof.
For purposes of this Section 1008, such compliance shall be determined without
regard to any period of grace or requirement of notice under this Indenture.
SECTION 1009. Additional Amounts. All payments made by PCS
under or with respect to Securities shall be in U.S. Dollars and shall be free
and clear of and without withholding
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or deduction for or on account of any present or future tax, duty, levy, impost,
assessment or other governmental charge of any nature whatsoever imposed or
levied by or on behalf of the Government of Canada or of any province or
territory thereof or by any authority or agency therein or thereof having power
to tax (hereinafter "Taxes"), unless PCS is required to withhold or deduct Taxes
by law or by the interpretation or administration thereof. If PCS is so required
to withhold or deduct any amount for or on account of Taxes from any payment
made under or with respect to Securities, PCS will pay such additional interest
("Additional Amounts") as may be necessary so that the net amount received by
each Holder (including Additional Amounts) after such withholding or deduction
will not be less than the amount the Holder would have received if such Taxes
had not been withheld or deducted; provided that no Additional Amounts will be
payable with respect to a payment made to a Holder (such Holder, an "Excluded
Holder") (a) with which PCS does not deal at arm's length (within the meaning of
the Income Tax Act (Canada)) at the time of making such payment, or (b) which is
subject to such Taxes by reason of its being connected with Canada or any
province or any territory thereof otherwise than by the mere holding of
Securities or the receipt of payments thereunder. PCS will also in accordance
with applicable law (a) make such withholding or deduction, and (b) remit the
full amount deducted or withheld to the relevant authority. PCS will furnish to
the Holder of such Securities, within 30 days after the date the payment of any
Taxes is due pursuant to applicable law, certified copies of tax receipts
evidencing such payment by PCS. PCS will indemnify and hold harmless each Holder
(other than an Excluded Holder) and upon written request reimburse each such
Holder for the amount of (a) any Taxes so levied or imposed and paid by such
Holder as a result of payments made under or with respect to Securities, (b) any
liability (including penalties, interest and expenses) arising therefrom or with
respect thereto, and (c) any Taxes imposed with respect to any reimbursement
under (a) or (b) in this sentence, but excluding any such Taxes on such Holder's
net income.
At least 30 days prior to each date on which any payment under
or with respect to Securities is due and payable, if PCS will be obligated to
pay Additional Amounts with respect to such payment, PCS will deliver to the
Trustee an Officer's Certificate stating the fact that such Additional Amounts
will be payable, the amounts so payable and such other information necessary to
enable the Trustee to pay such Additional Amounts to Holders on the payment
date. Wherever in this Indenture there is mentioned, in any context except in
the case of Section 502(a), the payment of the principal of (or premium, if any)
or interest on, or in respect of, any Security of any series or payment of any
related coupon or the net proceeds received on the sale or exchange of any
Security of any series, the payment of principal (and premium, if any), interest
or any other amount payable under or with respect to a Security, such mention
shall be deemed to include mention of the payment of Additional Amounts to the
extent that, in such context, Additional Amounts are, were or would be payable
in respect thereof.
The obligations of PCS under this Section 1009 shall survive
the termination of this Indenture and the payment of all amounts under or with
respect to Securities.
SECTION 1010. Limitation on Liens.
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(a) PCS shall not, and shall not permit any Subsidiary
of PCS to, incur any Lien on or with respect to any of the Principal Property
of PCS or any such Subsidiary now owned or hereafter acquired to secure Debt
without making, or causing such Subsidiary to make, effective provision for
securing the Securities (i) equally and ratably with such Debt as to such
Principal Property for so long as such Debt shall be so secured, or (ii) in the
event such Debt is subordinate in right of payment to the Securities, prior to
such Debt as to such Principal Property for so long as such Debt shall be so
secured.
The foregoing restrictions will not apply to Liens in
respect of Debt existing at the date of this Indenture, Liens on or with respect
to property that is not Principal Property or to:
(i) Liens securing only Securities;
(ii) Liens in favor of PCS or any of its
Subsidiaries;
(iii) Liens on property existing immediately prior
to the time of acquisition thereof (and not created in anticipation of
the financing of such acquisition);
(iv) Liens to secure Debt incurred for the
purpose of financing all or any part of the purchase price or the cost
of construction or improvement of property used in the business of PCS
or any of its Subsidiaries and subject to such Liens, provided that (A)
the principal amount of any Debt secured by such a Lien does not exceed
100% of such purchase price or cost, (B) such Lien does not extend to
or cover any other property other than such property and any such
improvements and (C) such Debt is incurred within 270 days of such
purchase, construction or improvement;
(v) Liens on property of a Person existing at
the time such Person is merged with or into or amalgamated or
consolidated with PCS or any of its Subsidiaries that were not created
in anticipation of the acquisition of such Person, provided that such
Lien does not extend to or cover any property other than that of the
Person so merged, amalgamated or consolidated;
(vi) Liens on any Principal Property in favor of
domestic or foreign governmental bodies to secure partial progress,
advance or other payments pursuant to any contract or statute of such
governmental body; and
(vii) Liens to secure Debt incurred to extend,
renew, refinance, replace or refund (or successive extensions,
renewals, refinancings, replacements or refundings), in whole or in
part, any secured Debt existing on the date of this Indenture or any
Debt secured by any Lien referred to in the foregoing clauses (i) to
(vi), so long as in each such case the Lien does not extend to any
other property and the Debt so secured is not increased other than for
reasonable costs related to such extension, renewal, refinancing,
replacement or refunding.
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(b) Notwithstanding the foregoing Paragraph (a), PCS and its
Subsidiaries may incur a Lien or Liens to secure Debt (excluding Debt secured by
Liens permitted under the foregoing exceptions) the aggregate amount of which,
including Attributable Debt in respect of Sale and Leaseback Transactions, does
not exceed 10% of Consolidated Net Tangible Assets.
(c) Notwithstanding the foregoing Paragraphs (a) and (b), PCS
and its Subsidiaries may incur a Lien or Liens to secure any Debt incurred
pursuant to a Sale and Leaseback Transaction, without securing the Securities
equally and ratably with or prior to such Debt, as applicable, provided that
such Sale and Leaseback Transaction complies with the terms of Paragraphs (b)
and (c) of Section 1011.
SECTION 1011. Limitation on Sale and Leaseback Transactions.
PCS shall not, and shall not permit any Subsidiary of PCS to, enter into any
Sale and Leaseback Transaction with respect to any Principal Property (except
for a period, including renewals, not exceeding 36 months) unless:
(a) at the time of entering into such Sale and Leaseback
Transaction, PCS or such Subsidiary would be entitled to incur Debt, in a
principal amount equal to the Attributable Debt in respect of such Sale and
Leaseback Transaction, secured by a Lien, without equally and ratably securing
the Securities;
(b) PCS or such Subsidiary applies, within 12 months after
the sale or transfer, an amount equal to the greater of (i) the net proceeds of
the Principal Property sold pursuant to the Sale and Leaseback Transaction, or
(ii) the fair value (in the opinion of an executive officer of PCS) of such
Principal Property to the acquisition of or construction on property used or to
be used in the ordinary course of business of PCS or a Subsidiary of PCS, and
PCS shall have elected to designate such amount as a credit against such Sale
and Leaseback Transaction; or
(c) PCS or such Subsidiary applies, within 12 months after
the sale or transfer, an amount equal to the net proceeds of Principal Property
sold pursuant to the Sale and Leaseback Transaction to the voluntary defeasance
or retirement of Debt, which amount shall not be less than the fair value (in
the opinion of an executive officer of PCS) of such Principal Property less an
amount equal to the principal amount of such Debt voluntarily defeased or
retired by PCS or such Subsidiary within such 12 month period and not
designated as a credit against any other Sale and Leaseback Transaction.
Notwithstanding the foregoing, in no event shall PCS be
required to defease or retire, in the aggregate with respect to any and all such
transactions, more than 25% of the original aggregate principal amount of a
series of Securities on or prior to the fifth anniversary of the Issue Date
thereof. If the aggregate net proceeds that PCS would be otherwise required to
defease or retire Securities on or prior to the fifth anniversary of the Issue
Date would exceed 25% of the original aggregate principal amount of such series
(such excess being "25% Excess Proceeds"), then promptly after such fifth
anniversary PCS shall defease or retire Securities in an amount equal to the 25%
Excess Proceeds. Pending such defeasing or retiring of Securities, the 25%
Excess Proceeds shall be invested and maintained in Permitted Short-Term
Investments and PCS shall not distribute such proceeds in respect of its shares.
SECTION 1012. Waiver of Certain Covenants. PCS may omit in any
particular instance to comply with any term, provision or condition set forth in
Sections 1004 to 1007, inclusive, or Section 1010 or Section 1011 if before or
after the time for such compliance the Holders of at least a majority in
principal amount of all outstanding Securities of such series, by Act of such
Holders, either waive such compliance in such instance or generally waive
compliance with such covenant or condition, but no such waiver shall extend to
or affect such covenant or condition except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of PCS and the
duties of the Trustee in respect of any such term, provision or condition shall
remain in full force and effect.
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ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Applicability of Article. Securities of any
series which are redeemable before their Stated Maturity shall be redeemable in
accordance with their terms and (except as otherwise specified as contemplated
by Section 301 for Securities of any series) in accordance with this Article
Eleven.
SECTION 1102. Election to Redeem; Notice to Trustee. The
election of PCS to redeem any Securities shall be evidenced by or pursuant to a
Board Resolution. In case of any redemption at the election of PCS of less than
all Securities of any series, PCS shall, at least 45 days prior to the giving of
the notice of redemption required by Section 1104 (unless a shorter notice shall
be satisfactory to the Trustee), notify the Trustee of such Redemption Date and
of the principal amount of Securities of such series to be redeemed and shall
deliver or cause to be delivered to the Trustee such documentation and records
as shall enable the Trustee to select, at the direction of PCS, Securities to
be redeemed pursuant to Section 1103. In the case of any redemption of
Securities prior to the expiration of any restriction on such redemption
provided in the terms of such Securities or elsewhere in this Indenture, PCS
shall furnish the Trustee with an Officer's Certificate evidencing compliance
with such restriction.
SECTION 1103. Selection by Trustee of Securities to Be
Redeemed. If less than all Securities of any series are to be redeemed, the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee at the direction of PCS, from
Outstanding Securities of such series not previously called for redemption, by
lot or pro rata as directed by PCS or by such method as the Trustee and PCS
shall deem fair and appropriate and which may provide for the selection for
redemption of portions (equal to the minimum authorized denomination for
Securities of that series or any integral multiple thereof) of the principal
amount of Securities of such series of a denomination larger than the minimum
authorized denomination for Securities of that series.
The Trustee shall promptly notify PCS in writing of the
Securities selected for redemption and, in the case of any Securities selected
for partial redemption, the principal amount thereof to be redeemed, and the
Trustee and PCS shall jointly advise the Security Registrar (if other than the
Trustee) of their selection.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any 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 1104. Notice of Redemption. Notice of redemption shall
be given in the manner provided in Section 106, not less than 30 days nor more
than 60 days prior to the Redemption Date, unless a shorter period is specified
by the terms of such series established pursuant to Section 301, to each Holder
of Securities to be redeemed, but failure to give such notice in the manner
herein
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provided to the Holder of any Security designated for redemption as a whole or
in part, or any defect in the notice to any such Holder, shall not affect the
validity of the proceedings for the redemption of any other such Security or
portion thereof.
Any notice that is mailed to the Holders of Registered
Securities in the manner herein provided shall be conclusively presumed to have
been duly given, whether or not the Holder receives the notice.
All notices of redemption shall state:
(a) the Redemption Date,
(b) the Redemption Price, accrued interest to the Redemption
Date payable as provided in Section 1106, if any, and Additional
Amounts, if any,
(c) if less than all Outstanding Securities of any series are
to be redeemed, the identification (and, in the case of partial
redemption, the principal amount) of the particular Security or
Securities to be redeemed,
(d) in case any Security is to be redeemed in part only, the
notice which relates to such Security shall state that on and after the
Redemption Date, upon surrender of such Security, the holder will
receive, without a charge, a new Security or Securities of authorized
denominations for the principal amount thereof remaining unredeemed,
(e) that on the Redemption Date, the Redemption Price and
accrued interest to the Redemption Date payable as provided in Section
1106, if any, will become due and payable upon each such Security, or
the portion thereof, to be redeemed and, if applicable, that interest
thereon shall cease to accrue on and after said date,
(f) the Place or Places of Payment where such Securities,
together in the case of Bearer Securities with all coupons appertaining
thereto, if any, maturing after the Redemption Date, are to be
surrendered for payment of the Redemption Price and accrued interest,
if any, or for conversion,
(g) that the redemption is for a sinking fund, if such is the
case,
(h) that, unless otherwise specified in such notice, Bearer
Securities of any series, if any, surrendered for redemption must be
accompanied by all coupons maturing subsequent to the date fixed for
redemption or the amount of any such missing coupon or coupons will be
deducted from the Redemption Price, unless security or indemnity
satisfactory to PCS, the Trustee for such series and any Paying Agent
is furnished,
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(i) if Bearer Securities of any series are to be redeemed and
any Registered Securities of such series are not to be redeemed, and if
such Bearer Securities may be exchanged for Registered Securities not
subject to redemption on this Redemption Date pursuant to Section 305
or otherwise, the last date, as determined by PCS, on which such
exchanges may be made,
(j) the CUSIP number of such Security, if any, and
(k) if applicable, that a Holder of Securities who desires to
convert Securities for redemption must satisfy the requirements for
conversion contained in such Securities, the then existing conversion
price or rate, and the date and time when the option to convert shall
expire.
Notice of redemption of Securities to be redeemed shall be
given by PCS or, at PCS's request, by the Trustee in the name and at the expense
of PCS.
SECTION 1105. Deposit of Redemption Price. At least one
Business Day prior to any Redemption Date, PCS shall deposit with the Trustee or
with a Paying Agent (or, if PCS is acting as its own Paying Agent, which it may
not do in the case of a sinking fund payment under Article Twelve, segregate and
hold in trust as provided in Section 1003) an amount of money in the currency or
currencies, currency unit or units or composite currency or currencies in which
Securities of such series are payable (except as otherwise specified pursuant to
Section 301 for Securities of such series) sufficient to pay on the Redemption
Date the Redemption Price of, and (except if the Redemption Date shall be an
Interest Payment Date) accrued interest on, all Securities or portions thereof
which are to be redeemed on that date.
SECTION 1106. Securities Payable on Redemption Date. Notice of
redemption having been given as aforesaid, Securities so to be redeemed shall,
on the Redemption Date, become due and payable at the Redemption Price therein
specified in the currency or currencies, currency unit or units or composite
currency or currencies in which Securities of such series are payable (except as
otherwise specified pursuant to Section 301 for Securities of such series)
(together with accrued interest, if any, to the Redemption Date), and from and
after such date (unless PCS shall default in the payment of the Redemption Price
and accrued interest) such Securities shall, if the same were interest-bearing,
cease to bear interest and the coupons for such interest appertaining to any
Bearer Securities so to be redeemed, except to the extent provided below, shall
be void. Upon surrender of any such Security for redemption in accordance with
said notice, together with all coupons, if any, appertaining thereto maturing
after the Redemption Date, such Security shall be paid by PCS at the Redemption
Price, together with accrued interest, if any, to the Redemption Date; provided,
however, that installments of interest on Bearer Securities whose Stated
Maturity is on or prior to the Redemption Date shall be payable only at an
office or agency located outside the United States (except as otherwise
provided in Section 1002) and, unless otherwise specified as contemplated by
Section 301, only upon presentation and surrender of coupons for such interest;
and provided further that, except as otherwise provided with respect to
Securities convertible into
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Common Stock or Preferred Stock, installments of interest on Registered
Securities whose Stated Maturity is on or prior to the Redemption Date shall be
payable to the Holders of such Securities, or one or more Predecessor
Securities, registered as such at the close of business on the relevant Record
Dates according to their terms and the provisions of Section 307.
If any Bearer Security surrendered for redemption shall not be
accompanied by all appurtenant coupons maturing after the Redemption Date, such
Security may be paid after deducting from the Redemption Price an amount equal
to the face amount of all such missing coupons, or the surrender of such missing
coupon or coupons may be waived by PCS and the Trustee if there is furnished to
them such security or indemnity as they may require to save each of them and any
Paying Agent harmless. If thereafter the Holder of such Security shall surrender
to the Trustee or any Paying Agent any such missing coupon in respect of which a
deduction shall have been made from the Redemption Price, such Holder shall be
entitled to receive the amount so deducted; provided, however, that interest
represented by coupons shall be payable only at an office or agency located
outside the United States (except as otherwise provided in Section 1002) and,
unless otherwise specified as contemplated by Section 301, only upon
presentation and surrender of those coupons.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal (and premium, if any)
shall, until paid, bear interest from the Redemption Date at the rate borne by
the Security.
SECTION 1107. Securities Redeemed in Part. Any Registered
Security which is to be redeemed only in part (pursuant to the provisions of
this Article Eleven or Article Twelve) shall be surrendered at a Place of
Payment therefor (with, if PCS or the Trustee so requires, due endorse ment by,
or a written instrument of transfer in form satisfactory to PCS and the Trustee
duly executed by, the Holder thereof or his attorney duly authorized in writing)
and PCS shall execute and the Trustee shall authenticate and deliver to the
Holder of such Security without service charge a new Security or Securities of
the same series, of any authorized denomination as requested by such Holder in
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered.
ARTICLE TWELVE
SINKING FUNDS
SECTION 1201. Applicability of Article. The provisions of this
Article Twelve shall be applicable to any sinking fund for the retirement of
Securities of a series except as otherwise specified as contemplated by Section
301 for Securities of such series.
The minimum amount of any sinking fund payment provided for by
the terms of Securities of any series is herein referred to as a "mandatory
sinking fund payment," and any payment
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in excess of such minimum amount provided for by the terms of such Securities of
any series is herein referred to as an "optional sinking fund payment". If
provided for by the terms of any Securities of any series, the cash amount of
any mandatory sinking fund payment may be subject to reduction as provided in
Section 1202. Each sinking fund payment shall be applied to the redemption of
Securities of any series as provided for by the terms of Securities of such
series.
SECTION 1202. Satisfaction of Sinking Fund Payments with
Securities. PCS may, in satisfaction of all or any part of any mandatory sinking
fund payment with respect to Securities of a series, (a) deliver Outstanding
Securities of such series (other than any previously called for redemption)
together in the case of any Bearer Securities of such series with all unmatured
coupons appertaining thereto, and (b) apply as a credit Securities of such
series which have been redeemed either at the election of PCS pursuant to the
terms of such Securities or through the application of permitted optional
sinking fund payments pursuant to the terms of such Securities, as provided for
by the terms of such Securities, or which have otherwise been acquired by PCS;
provided that such Securities so delivered or applied as a credit have not been
previously so credited. Such Securities shall be received and credited for such
purpose by the Trustee at the applicable Redemption Price specified in such
Securities for redemption through operation of the sinking fund and the amount
of such mandatory sinking fund payment shall be reduced accordingly.
Unless otherwise provided in any Security or coupon of any
series, no Sinking Fund arrangement shall be entered into if, in the opinion of
Canadian tax counsel to PCS, such arrangement could reasonably be considered to
contravene the requirements of Subparagraph 212(1)(b)(vii) of the Income Tax Act
(Canada) respecting the exemption from Canadian tax on interest paid to
non-residents of Canada.
SECTION 1203. Redemption of Securities for Sinking Fund. Not
less than 60 days prior to each sinking fund payment date for Securities of any
series, PCS shall deliver to the Trustee an Officer's Certificate specifying the
amount of the next ensuing mandatory sinking fund payment for that series
pursuant to the terms of that series, the portion thereof, if any, which is to
be satisfied by payment of cash in the currency or currencies, currency unit or
units or composite currency or currencies in which Securities of such series are
payable (except as otherwise specified pursuant to Section 301 for Securities of
such series) and the portion thereof, if any, which is to be satisfied by
delivering and crediting Securities of that series pursuant to Section 1202, and
the optional amount, if any, to be added in cash to the next ensuing mandatory
sinking fund payment, and will also deliver to the Trustee any Securities to be
so delivered and credited. If such Officer's Certificate shall specify an
optional amount to be added in cash to the next ensuing mandatory sinking fund
payment, PCS shall thereupon be obligated to pay the amount therein specified.
Not less than 30 days before each such sinking fund payment date the Trustee
shall select Securities to be redeemed upon such sinking fund payment date in
the manner specified in Section 1103 and cause notice of the redemption thereof
to be given in the name of and at the expense of PCS in the manner provided in
Section 1104. Such notice having been duly given, the redemption of such
Securities shall be made upon the terms and in the manner stated in Sections
1106 and 1107.
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ARTICLE THIRTEEN
REPAYMENT AT THE OPTION OF HOLDERS
SECTION 1301. Applicability of Article. Repayment of
Securities of any series before their Stated Maturity at the option of Holders
thereof shall be made in accordance with the terms of such Securities, if any,
and (except as otherwise specified by the terms of such series established
pursuant to Section 301) in accordance with this Article Thirteen.
SECTION 1302. Repayment of Securities. Securities of any
series subject to repayment in whole or in part at the option of the Holders
thereof will, unless otherwise provided in the terms of such Securities, be
repaid at a price equal to the principal amount thereof, together with interest,
if any, thereon accrued to the Repayment Date specified in or pursuant to the
terms of such Securities. PCS covenants that at least one Business Day prior to
the Repayment Date it will deposit with the Trustee or with a Paying Agent (or,
if PCS is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 1003) an amount of money in the currency or currencies,
currency unit or units or composite currency or currencies in which Securities
of such series are payable (except as otherwise specified pursuant to Section
301 for Securities of such series) sufficient to pay the principal (or, if so
provided by the terms of Securities of any series, a percentage of the
principal) of, and (except if the Repayment Date shall be an Interest Payment
Date) accrued interest on, all Securities or portions thereof, as the case may
be, to be repaid on such date.
SECTION 1303. Exercise of Option. Securities of any series
subject to repayment at the option of the Holders thereof will contain an
"Option to Elect Repayment" form on the reverse of such Securities. In order for
any Security to be repaid at the option of the Holder, the Trustee must receive
at the Place of Payment therefor specified in the terms of such Security (or at
such other place or places of which PCS shall from time to time notify the
Holders of such Securities) not earlier than 60 days nor later than 30 days
prior to the Repayment Date (a) the Security so providing for such repayment
together with the "Option to Elect Repayment" form on the reverse thereof duly
completed by the Holder (or by the Holder's attorney duly authorized in
writing), or (b) a telegram, telex, facsimile transmission or a letter from a
member of a national securities exchange, or the National Association of
Securities Dealers, Inc., or a commercial bank or trust company in the United
States setting forth the name of the Holder of the Security, the principal
amount of the Security, the principal amount of the Security to be repaid, the
CUSIP number, if any, or a description of the tenor and terms of the Security, a
statement that the option to elect repayment is being exercised thereby and a
guarantee that the Security to be repaid, together with the duly completed form
entitled "Option to Elect Repayment" on the reverse of the Security, will be
received by the Trustee not later than the fifth Business Day after the date of
such telegram, telex, facsimile transmission or letter; provided, however, that
such telegram, telex, facsimile transmission or letter shall only be effective
if such Security and form duly completed are received by the Trustee by such
fifth Business Day. If less than the entire principal amount of such Security is
to be repaid in accordance with the terms of such Security, the principal amount
of such Security to be repaid, in increments of the minimum denomination for
Securities of such series, and the denomination or denominations of the Security
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or Securities to be issued to the Holder for the portion of the principal amount
of such Security surrendered that is not to be repaid, must be specified. The
principal amount of any Security providing for repayment at the option of the
Holder thereof may not be repaid in part if, following such repayment, the
unpaid principal amount of such Security would be less than the minimum
authorized denomination of Securities of the series of which such Security to be
repaid is a part. Except as otherwise may be provided by the terms of any
Security providing for repayment at the option of the Holder thereof, exercise
of the repayment option by the Holder shall be irrevocable unless waived by PCS.
SECTION 1304. When Securities Presented for Repayment Become
Due and Payable. If Securities of any series providing for repayment at the
option of the Holders thereof shall have been surrendered as provided in this
Article Thirteen and as provided by or pursuant to the terms of such Securities,
such Securities or the portions thereof, as the case may be, to be repaid shall
become due and payable and shall be paid by PCS on the Repayment Date therein
specified, and on and after such Repayment Date (unless PCS shall default in the
payment of such Securities on such Repayment Date) such Securities shall, if the
same are interest-bearing, cease to bear interest and the coupons for such
interest appertaining to any Bearer Securities so to be repaid, except to the
extent provided below, shall be void. Upon surrender of any such Security for
repayment in accordance with such provisions, together with all coupons, if any,
appertaining thereto maturing after the Repayment Date, the principal amount of
such Security so to be repaid shall be paid by PCS, together with accrued
interest, if any, to the Repayment Date; provided, however, that coupons whose
Stated Maturity is on or prior to the Repayment Date shall be payable only at an
office or agency located outside the United States (except as otherwise
provided in Section 1002) and, unless otherwise specified pursuant to Section
301, only upon presentation and surrender of such coupons; and provided further
that, in the case of Registered Securities, installments of interest, if any,
whose Stated Maturity is on or prior to the Repayment Date shall be payable
(but without interest thereon, unless PCS shall default in the payment thereof)
to the Holders of such Securities, or one or more Predecessor Securities,
registered as such at the close of business on the relevant Record Dates
according to their terms and the provisions of Section 307.
If any Bearer Security surrendered for repayment shall not be
accompanied by all appurtenant coupons maturing after the Repayment Date, such
Security may be paid after deducting from the amount payable therefor as
provided in Section 1302 an amount equal to the face amount of all such missing
coupons, or the surrender of such missing coupon or coupons may be waived by PCS
and the Trustee if there is furnished to them such security or indemnity as they
may require to save each of them and any Paying Agent harmless. If thereafter
the Holder of such Security shall surrender to the Trustee or any Paying Agent
any such missing coupon in respect of which a deduction shall have been made as
provided in the preceding sentence, such Holder shall be entitled to receive the
amount so deducted; provided, however, that interest represented by coupons
shall be payable only at an office or agency located outside the United States
(except as otherwise provided in Section 1002) and, unless otherwise specified
as contemplated by Section 301, only upon presentation and surrender of those
coupons.
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If the principal amount of any Security surrendered for
repayment shall not be so repaid upon surrender thereof, such principal amount
(together with interest, if any, thereon accrued to such Repayment Date) shall,
until paid, bear interest from the Repayment Date at the rate of interest or
Yield to Maturity (in the case of Original Issue Discount Securities) set forth
in such Security.
SECTION 1305. Securities Repaid in Part. Upon surrender of any
Registered Security which is to be repaid in part only, PCS shall execute and
the Trustee shall authenticate and deliver to the Holder of such Security,
without service charge and at the expense of PCS, a new Registered Security or
Securities of the same series, of any authorized denomination specified by the
Holder, in an aggregate principal amount equal to and in exchange for the
portion of the principal of such Security so surrendered which is not to be
repaid.
ARTICLE FOURTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1401. Applicability of Article; PCS's Option to Effect
Defeasance or Covenant Defeasance. If, pursuant to Section 301, provision is
made for either or both of (a) defeasance of Securities of or within a series
under Section 1402, or (b) covenant defeasance of Securities of or within a
series under Section 1403, then the provisions of such Section or Sections, as
the case may be, together with the other provisions of this Article Fourteen
(with such modifications thereto as may be specified pursuant to Section 301
with respect to any Securities), shall be applicable to such Securities and any
coupons appertaining thereto, and PCS may at its option by Board Resolution, at
any time, with respect to such Securities and any coupons appertaining thereto
elect to have Section 1402 (if applicable) or Section 1403 (if applicable) be
applied to such Outstanding Securities and any coupons appertaining thereto upon
compliance with the conditions set forth below in this Article Fourteen.
SECTION 1402. Defeasance and Discharge. Upon PCS's exercise of
the above option applicable to this Section 1402 with respect to any Securities
of or within a series, PCS shall be deemed to have been discharged from its
obligations with respect to such Outstanding Securities and any coupons
appertaining thereto on the date the conditions set forth in Section 1404 are
satisfied ("defeasance"). For this purpose, such defeasance means that PCS shall
be deemed to have paid and discharged the entire indebtedness represented by
such Outstanding Securities and any coupons appertaining thereto, which shall
thereafter be deemed to be "Outstanding" only for the purposes of Section 1405
and the other Sections of this Indenture referred to in Paragraphs (a) and (b)
below, and to have satisfied all of its other obligations under such Securities
and any coupons appertaining thereto and this Indenture insofar as such
Securities and any coupons appertaining thereto are concerned (and the Trustee,
at the expense of PCS, shall execute proper instruments acknowledging the same),
except for the following which shall survive until otherwise terminated or
discharged hereunder:
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(a) the rights of Holders of such Outstanding Securities and
any coupons appertaining thereto to receive, solely from the trust fund
described in Section 1404 and as more fully set forth in such Section, payments
in respect of the principal of (and premium, if any) and interest on such
Securities and any coupons appertaining thereto when such payments are due,
(b) PCS's obligations with respect to such Securities under
Sections 304, 305, 306, 1002 and 1003 and with respect to the payment of
Additional Amounts, if any, on such Securities as contemplated by Section 1009,
(c) the rights, powers, trusts, duties and immunities of the
Trustee hereunder, and
(d) this Article Fourteen.
Subject to compliance with this Article Fourteen, PCS may exercise its option
under this Section 1402 notwithstanding the prior exercise of its option under
Section 1403 with respect to such Securities and any coupons appertaining
thereto.
SECTION 1403. Covenant Defeasance. Upon PCS's exercise of the
above option applicable to this Section 1403 with respect to any Securities of
or within a series, PCS shall be released from its obligations under Sections
1004 to 1007, inclusive, Sections 1010 and 1011 and, if specified pursuant to
Section 301, its obligations under any other covenant, with respect to such
Outstanding Securities and any coupons appertaining thereto on and after the
date the conditions set forth in Section 1404 are satisfied ("covenant
defeasance"), and such Securities and any coupons appertaining thereto shall
thereafter be deemed to be not "Outstanding" for the purposes of any direction,
waiver, consent or declaration or Act of Holders (and the consequences of any
thereof) in connection with Sections 1004 to 1007, inclusive, Sections 1010 and
1011 or such other covenant, but shall continue to be deemed "Outstanding" for
all other purposes hereunder. For this purpose, such covenant defeasance means
that, with respect to such Outstanding Securities and any coupons appertaining
thereto, PCS may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such Section or such other
covenant, whether directly or indirectly, by reason of any reference elsewhere
herein to any such Section or such other covenant or by reason of reference in
any such Section or such other covenant to any other provision herein or in any
other document and such omission to comply shall not constitute a default or an
Event of Default under Section 501(d) or 501(h) or otherwise, as the case may
be, but, except as specified above, the remainder of this Indenture and such
Securities and any coupons appertaining thereto shall be unaffected thereby.
SECTION 1404. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of Section 1402 or Section
1403 to any Outstanding Securities of or within a series and any coupons
appertaining thereto:
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(a) PCS shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the
requirements of Section 607 who shall agree to comply with the
provisions of this Article Fourteen applicable to it) as trust funds in
trust for the purpose of making the following payments, specifically
pledged as security for, and dedicated solely to, the benefit of the
Holders of such Securities and any coupons appertaining thereto, (i) an
amount in such currency, currencies or currency unit in which such
Securities and any coupons appertaining thereto are then specified as
payable at Stated Maturity, (ii) Government Obligations applicable to
such Securities and coupons appertaining thereto (determined on the
basis of the currency, currencies or currency unit in which such
Securities and coupons appertaining thereto are then specified as
payable at Stated Maturity) which through the scheduled payment of
principal and interest in respect thereof in accordance with their
terms will provide, not later than one day before the due date of any
payment of principal of (and premium, if any) and interest, if any, on
such Securities and any coupons appertaining thereto, money in an
amount, or (iii) a combination thereof, in any case, in an amount,
sufficient, without consideration of any reinvestment of such principal
and interest, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, and which shall
be applied by the Trustee (or other qualifying trustee) to pay and
discharge (i) the principal of (and premium, if any) and interest on
such Outstanding Securities and any coupons appertaining thereto on the
Stated Maturity of such principal (and premium, if any) or installment
of principal or interest, and (ii) any mandatory sinking fund payments
or analogous payments applicable to such Outstanding Securities and any
coupons appertaining thereto on the day on which such payments are due
and payable in accordance with the terms of this Indenture and of such
Securities and any coupons appertaining thereto; provided that the
Trustee shall have been irrevocably instructed to apply such money or
the proceeds of such Government Obligations to said payments with
respect to such Securities and any related coupons. Before such a
deposit, PCS may give to the Trustee, in accordance with Section 1102
hereof, a notice of its election to redeem all or any portion of such
Outstanding Securities at a future date in accordance with the terms of
Securities of such series and Article Eleven hereof, which notice shall
be irrevocable. Such irrevocable redemption notice, if given, shall be
given effect in applying the foregoing.
(b) Such defeasance or covenant defeasance shall not result in
a breach or violation of, or constitute a default under, this Indenture
or any other material agreement or instrument to which PCS is a party
or by which it is bound.
(c) No Event of Default or event which with notice or lapse of
time or both would become an Event of Default with respect to such
Securities and any coupons appertaining thereto shall have occurred and
be continuing on the date of such deposit or, insofar as Sections
501(f) and 501(g) 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).
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(d) In the case of an election under Section 1402, PCS shall
have delivered to the Trustee an Opinion of Counsel stating that (i)
PCS has received from, or there has been published by, the Internal
Revenue Service a ruling, or (ii) since the date of execution of this
Indenture, there has been a change in the applicable Federal income tax
law, in either case to the effect that, and based thereon such opinion
shall confirm that, the Holders of such Outstanding Securities and any
coupons appertaining thereto will not recognize income, gain or loss
for Federal income tax purposes as a result of such 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
defeasance had not occurred.
(e) In the case of an election under Section 1403, PCS shall
have delivered to the Trustee an Opinion of Counsel to the effect that
the Holders of such Outstanding Securities and any coupons appertaining
thereto will not recognize income, gain or loss for Federal income tax
purposes as a result of such 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 covenant defeasance had
not occurred.
(f) PCS shall have delivered to the Trustee an Opinion of
Counsel in Canada or a ruling from Revenue Canada, Customs, Excise and
Taxation to the effect that the Holders of such Outstanding Securities
and any related coupons will not recognize income, gain or loss for
Canadian federal or provincial income tax or other tax purposes as a
result of such defeasance or covenant defeasance and will be subject to
Canadian federal or provincial income tax and other tax on the same
amounts, in the same manner and at the same times as would have been
the case had such defeasance or covenant defeasance not occurred (and
for the purposes of such opinion, such Canadian counsel shall assume
that Holders of such outstanding Securities include Holders who are not
resident in Canada).
(g) PCS shall not be an "insolvent person" within the meaning
of the Bankruptcy and Insolvency Act (Canada) on the date of such
deposit or 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).
(h) PCS shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that all conditions
precedent to the defeasance under Section 1402 or the covenant
defeasance under Section 1403 (as the case may be) have been complied
with and an Opinion of Counsel to the effect that either (i) as a
result of a deposit pursuant to Paragraph (a) above and the related
exercise of PCS's option under Section 1402 or Section 1403 (as the
case may be), registration is not required under the Investment Company
Act of 1940, as amended, by PCS, with respect to the trust funds
representing such deposit or by the Trustee for such trust funds, or
(ii) all necessary registrations under said Act have been effected.
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(i) Notwithstanding any other provisions of this Section 1404,
such defeasance or covenant defeasance shall be effected in compliance
with any additional or substitute terms, conditions or limitations
which may be imposed on PCS in connection therewith pursuant to Section
301.
SECTION 1405. Deposited Money and Government Obligations to Be
Held in Trust; Other Miscellaneous Provisions. Subject to the provisions of the
last paragraph of Section 1003, all money and Government Obligations (or other
property as may be provided pursuant to Section 301) (including the proceeds
thereof) deposited with the Trustee pursuant to Section 1404 in respect of any
Outstanding Securities of any series and any coupons appertaining thereto shall
be held in trust and applied by the Trustee, in accordance with the provisions
of such Securities and any coupons appertaining thereto and this Indenture, to
the payment, either directly or through any Paying Agent (including PCS acting
as its own Paying Agent) as the Trustee may determine, to the Holders of such
Securities and any coupons appertaining thereto of all sums due and to become
due thereon in respect of principal (and premium, if any), interest and
Additional Amounts, if any, but such money need not be segregated from other
funds except to the extent required by law.
Unless otherwise specified with respect to any Security
pursuant to Section 301, if, after a deposit referred to in Section 1404(a) has
been made (a) the Holder of a Security in respect of which such deposit was made
is entitled to, and does, elect pursuant to Section 301 or the terms of such
Security to receive payment in a currency or currency unit other than that in
which the deposit pursuant to Section 1404(a) has been made in respect of such
Security, or (b) a Conversion Event occurs in respect of the currency or
currency unit in which the deposit pursuant to Section 1404(a) has been made,
the indebtedness represented by such Security and any coupons appertaining
thereto shall be deemed to have been, and will be, fully discharged and
satisfied through the payment of the principal of (and premium, if any), and
interest on such Security as the same becomes due out of the proceeds yielded by
converting (from time to time as specified below in the case of any such
election) the amount or other property deposited in respect of such Security
into the currency or currency unit in which such Security becomes payable as a
result of such election or Conversion Event based on a commercially reasonable
market exchange rate for such currency or currency unit in effect on the second
Business Day prior to each payment date, except, with respect to a Conversion
Event, for such currency or currency unit in effect (as nearly as feasible) at
the time of the Conversion Event.
PCS 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 1404 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of such Outstanding Securities and any coupons
appertaining thereto.
Anything in this Article Fourteen to the contrary
notwithstanding, subject to Section 606, the Trustee shall deliver or pay to PCS
from time to time upon a PCS Request any money or Government Obligations (or
other property and any proceeds therefrom) held by it as provided in Section
1404 which, in the opinion of a nationally recognized firm of independent public
accountants
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expressed in a written certification thereof delivered to the Trustee, are in
excess of the amount thereof which would then be required to be deposited to
effect a defeasance or covenant defeasance, as applicable, in accordance with
this Article Fourteen..
ARTICLE FIFTEEN
MEETINGS OF HOLDERS OF SECURITIES
SECTION 1501. Purposes for Which Meetings May Be Called. A
meeting of Holders of Securities of any series may be called at any time and
from time to time pursuant to this Article Fifteen to make, give or take any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be made, given or taken by Holders of
Securities of such series.
SECTION 1502. Call, Notice and Place of Meetings. (a) The
Trustee may at any time call a meeting of Holders of Securities of any series
for any purpose specified in Section 1501, to be held at such time and at such
place as the Trustee shall determine. Notice of every meeting of Holders of
Securities of any series, setting forth the time and the place of such meeting
and in general terms the action proposed to be taken at such meeting, shall be
given, in the manner provided in Section 106, not less than 21 nor more than 180
days prior to the date fixed for the meeting.
(b) In case at any time PCS, pursuant to a Board Resolution,
or the Holders of at least 10% in principal amount of Outstanding Securities of
any series shall have requested the Trustee to call a meeting of the Holders of
Securities of such series for any purpose specified in Section 1501, by written
request setting forth in reasonable detail the action proposed to be taken at
the meeting, and the Trustee shall not have made the first publication of the
notice of such meeting within 21 days after receipt of such request or shall not
thereafter proceed to cause the meeting to be held as provided herein, then PCS
or the Holders of Securities of such series in the amount above specified, as
the case may be, may call such meeting for such purposes by giving notice
thereof as provided in Paragraph (a) of this Section 1502.
SECTION 1503. Persons Entitled to Vote at Meetings. To be
entitled to vote at any meeting of Holders of Securities of any series, a Person
shall be (a) a Holder of one or more Outstanding Securities of such series, or
(b) a Person appointed by an instrument in writing as proxy for a Holder or
Holders of one or more Outstanding Securities of such series by such Holder or
Holders. The only Persons who shall be entitled to be present or to speak at any
meeting of Holders of Securities of any series shall be the Persons entitled to
vote at such meeting and their counsel, any representatives of the Trustee and
its counsel and any representatives of PCS and its counsel.
SECTION 1504. Quorum; Action. The Persons entitled to vote a
majority in principal amount of Outstanding Securities of a series shall
constitute a quorum for a meeting of Holders of Securities of such series;
provided, however, that if any action is to be taken at such
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meeting with respect to a consent or waiver which this Indenture expressly
provides may be given by the Holders of not less than a specified percentage,
which is less than a majority, in principal amount of Outstanding Securities of
a series, there shall be no quorum requirement. In the absence of a required
quorum within 30 minutes after the time appointed for any such meeting, the
meeting shall, if convened at the request of Holders of Securities of such
series, be dissolved. In any other case the meeting may be adjourned for a
period of not less than 10 days as determined by the chairman of the meeting
prior to the adjournment of such meeting. In the absence of a quorum at the
reconvening of any such adjourned meeting, such adjourned meeting may be further
adjourned for a period of not less than 10 days; at the reconvening of any
meeting adjourned or further adjourned for lack of a quorum, the persons
entitled to vote 25% in the aggregate principal amount of Securities at the time
outstanding shall constitute a quorum for the taking of any action set forth in
the notice of the original meeting. Notice of the reconvening of any adjourned
meeting shall be given as provided in Section 1502(a), except that such notice
need be given not less than five days prior to the date on which the meeting is
scheduled to be reconvened. Notice of the reconvening of any adjourned meeting
shall state expressly the percentage of the principal amount of Outstanding
Securities of such series which shall constitute such required quorum.
Except as limited by the proviso to Section 902, any
resolution presented to a meeting or adjourned meeting duly reconvened at which
a quorum is present as aforesaid may be adopted by the affirmative vote of the
persons entitled to vote a majority in aggregate principal amount of Outstanding
Securities represented at such meeting; provided, however, that, except as
limited by the proviso to Section 902, any resolution with respect to any
request, demand, authorization, direction, notice, consent, waiver or other
action which this Indenture expressly provides may be made, given or taken by
the Holders of a specified percentage, which is less than a majority, in
principal amount of Outstanding Securities of a series may be adopted at a
meeting or an adjourned meeting duly reconvened by the affirmative vote of the
Holders of such specified percentage in principal amount of Outstanding
Securities of that series.
Any resolution passed or decision taken at any meeting of
Holders of Securities of any series duly held in accordance with this Section
1504 shall be binding on all the Holders of Securities of such series and the
related coupons, whether or not present or represented at the meeting.
Notwithstanding the foregoing provisions of this Section 1504,
if any action is to be taken at a meeting of Holders of Securities of any series
with respect to any request, demand, authorization, direction, notice, consent,
waiver or other action that this Indenture expressly provides may be made, given
or taken by the Holders of a specified percentage, which is less than a
majority, in principal amount of all Outstanding Securities affected thereby, or
of the Holders of such series and one or more additional series:
(i) there shall be no quorum requirement for such
meeting; and
(ii) the principal amount of Outstanding Securities
affected thereby that vote in favor of such request, demand,
authorization, direction, notice, consent, waiver or other action shall
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be taken into account in determining whether such request, demand,
authorization, direction, notice, consent, waiver or other action has
been made, given or taken under this Indenture.
SECTION 1505. Determination of Voting Rights; Conduct of
Meetings. (a) The Trustee may make such reasonable regulations as it may deem
advisable for any meeting of Holders of Securities of a series in regard to
proof of the holding of Securities of such series and of the appointment of
proxies and in regard to the appointment and duties of inspectors of votes, the
submission and examination of proxies, certificates and other evidence of the
right to vote, and such other matters concerning the conduct of the meeting as
it shall deem appropriate. Except as otherwise permitted or required by any such
regulations, the holding of Securities shall be proved in the manner specified
in Section 104 and the appointment of any proxy shall be proved in the manner
specified in Section 104 or by having the signature of the Person executing the
proxy witnessed or guaranteed by any trust company, bank or banker authorized by
Section 104 to certify to the holding of Bearer Securities. Such regulations may
provide that written instruments appointing proxies, regular on their face, may
be presumed valid and genuine without the proof specified in Section 104 or
other proof.
(b) The Trustee shall, by an instrument in writing appoint a
temporary chairman of the meeting, unless the meeting shall have been called by
PCS or by Holders of Securities as provided in Section 1502(b), in which case
PCS or the Holders of Securities of the series calling the meeting, as the case
may be, shall in like manner appoint a temporary chairman. A permanent chairman
and a permanent secretary of the meeting shall be elected by vote of the Persons
entitled to vote a majority in principal amount of Outstanding Securities of
such series represented at the meeting.
(c) At any meeting each Holder of a Security of such series or
proxy shall be entitled to one vote for each $1,000 principal amount of
Outstanding Securities of such series held or represented by him; provided,
however, that no vote shall be cast or counted at any meeting in respect of any
Security challenged as not Outstanding and ruled by the chairman of the meeting
to be not Outstanding. The chairman of the meeting shall have no right to vote,
except as a Holder of a Security of such series or proxy.
SECTION 1506. Counting Votes and Recording Action of Meetings.
The vote upon any resolution submitted to any meeting of Holders of Securities
of any series shall be by written ballots on which shall be subscribed the
signatures of the Holders of Securities of such series or of their
representatives by proxy and the principal amounts and serial numbers of
Outstanding Securities of such series held or represented by them. The permanent
chairman of the meeting shall appoint two inspectors of votes who shall count
all votes cast at the meeting for or against any resolution and who shall make
and file with the secretary of the meeting their verified written reports in
duplicate of all votes cast at the meeting. A record, at least in duplicate, of
the proceedings of each meeting of Holders of Securities of any Series shall be
prepared by the secretary of the meeting and there shall be attached to said
record the original reports of the inspectors of votes on any vote by ballot
taken thereat and affidavits by one or more persons having knowledge of the
fact, setting forth a copy of the notice of the meeting and showing that said
notice was given as provided in Section 1502 and,
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if applicable, Section 1504. Each copy shall be signed and verified by the
affidavits of the permanent chairman and secretary of the meeting and one such
copy shall be delivered to PCS and another to the Trustee to be preserved by the
Trustee, the latter to have attached thereto the ballots voted at the meeting.
Any record so signed and verified shall be conclusive evidence of the matters
therein stated.
*****
This Indenture may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same Indenture.
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IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed all as of the day and year first above written.
POTASH CORPORATION OF SASKATCHEWAN INC.
By:
-------------------------------------
Title:
Attest:
- -----------------------------------
Title:
----------------------------------------
as Trustee
By:
-------------------------------------
Title:
Attest:
- -----------------------------------
Title:
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STATE OF __________________)
) ss:
COUNTY OF _________________)
On the ______ day of ___________, 1997, before me personally came , to
me known, who, being by me duly sworn, did depose and say that he/she resides at
_______________________________, that he/she is __________________________of
POTASH CORPORATION OF SASKATCHEWAN INC., one of the parties described in and
which executed the foregoing instrument, and that he/she signed his/her name
thereto by authority of the Board of Directors.
[Notarial Seal]
------------------------
Notary Public
Commission Expires
-------------------
STATE OF __________________)
) ss:
COUNTY OF _________________)
On the ______ day of ___________, 1997, before me personally came
__________________, to me known, who, being by me duly sworn, did depose and say
that he/she resides at ___________________________________, that he/she is a
_____________________ of ________________, one of the parties described in and
which executed the foregoing instrument, and that he/she signed his/her name
thereto by authority of the Board of Directors.
[Notarial Seal]
------------------------
Notary Public
Commission Expires
-------------------
-85-
<PAGE> 94
EXHIBIT A
FORMS OF CERTIFICATION
EXHIBIT A-1
FORM OF CERTIFICATE TO BE GIVEN BY PERSON ENTITLED
TO RECEIVE BEARER SECURITY OR TO OBTAIN INTEREST
PAYABLE PRIOR TO THE EXCHANGE DATE
CERTIFICATE
[Insert title or sufficient description of Securities to be delivered]
This is to certify that, as of the date hereof, and except as
set forth below, the above-captioned Securities held by you for our account (i)
are owned by person(s) that are not citizens or residents of the United States,
domestic partnerships, domestic corporations or any estate or trust the income
of which is subject to United States federal income taxation regardless of its
source ("United States person(s)"), (ii) are owned by United States person(s)
that are (a) foreign branches of United States financial institutions (financial
institutions, as defined in United States Treasury Regulations Section
1.165-12(c)(1)(v) are herein referred to as "financial institutions") purchasing
for their own account or for resale, or (b) United States person(s) who acquired
Securities through foreign branches of United States financial institutions and
who hold Securities through such United States financial institutions on the
date hereof (and in either case (a) or (b), each such United States financial
institution hereby agrees, on its own behalf or through its agent, that you may
advise Potash Corporation of Saskatchewan Inc. or its agent that such financial
institution will comply with the requirements of Section 165(j)(3)(A), (B) or
(C) of the United States Internal Revenue Code of 1986, as amended, and the
regulations thereunder), or (iii) are owned by United States or foreign
financial institution(s) for purposes of resale during the restricted period (as
defined in United States Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7)),
and, in addition, if the owner is a United States or foreign financial
institution described in clause (iii) above (whether or not also described in
clause (i) or (ii)), this is to further certify that such financial institution
has not acquired Securities for purposes of resale directly or indirectly to a
United States person or to a person within the United States or its possessions.
As used herein, "United States" means the United States of
America (including the States and the District of Columbia); and its
"possessions" include Puerto Rico, the U.S. Virgin Islands, Guam, American
Samoa, Wake Island and the Northern Mariana Islands.
We undertake to advise you promptly by tested telex on or
prior to the date on which you intend to submit your certification relating to
the above-captioned Securities held by you for our
<PAGE> 95
account in accordance with your Operating Procedures if any applicable statement
herein is not correct on such date, and in the absence of any such notification
it may be assumed that this certification applies as of such date.
This certificate excepts and does not relate to [U.S.$]
____________ of such interest in the above-captioned Securities in respect of
which we are not able to certify and as to which we understand an exchange for
an interest in a Permanent Global Security or an exchange for and delivery of
definitive Securities (or, if relevant, collection of any interest) cannot be
made until we do so certify.
We understand that this certificate may be required in
connection with certain tax legislation in the United States. If administrative
or legal proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certificate or a copy thereof to any interested party in such proceedings.
Dated:___________________, 19__
[To be dated no earlier than the 15th day prior
to (i) the Exchange Date or (ii) the relevant
Interest Payment Date occurring prior to the
Exchange Date, as applicable]
[Name of Person Making
Certification]
------------------------------
(Authorized Signatory)
Name:
Title:
<PAGE> 96
EXHIBIT A-2
FORM OF CERTIFICATE TO BE GIVEN BY EUROCLEAR
AND CEDEL S.A. IN CONNECTION WITH THE EXCHANGE OF
A PORTION OF A TEMPORARY GLOBAL SECURITY OR TO
OBTAIN INTEREST PAYABLE PRIOR TO THE EXCHANGE DATE
CERTIFICATE
[Insert title or sufficient description of Securities to be delivered]
This is to certify that, based solely on certifications that
we have received in writing, by tested telex or by electronic transmission from
each of the persons appearing in our records as persons entitled to a portion of
the principal amount set forth below (our "Member Organizations") substantially
in the form attached hereto, as of the date hereof, [U.S.$] ___________________
principal amount of the above-captioned Securities (i) is owned by person(s)
that are not citizens or residents of the United States, domestic partnerships,
domestic corporations or any estate or trust the income of which is subject to
United States Federal income taxation regardless of its source ("United States
person(s)"), (ii) is owned by United States person(s) that are (a) foreign
branches of United States financial institutions (financial institutions, as
defined in U.S. Treasury Regulations Section 1.165-12(c)(1)(v) are herein
referred to as "financial institutions") purchasing for their own account or
for resale, or (b) United States person(s) who acquired Securities through
foreign branches of United States financial institutions and who hold
Securities through such United States financial institutions on the date hereof
(and in either case (a) or (b), each such financial institution has agreed, on
its own behalf or through its agent, that we may advise Potash Corporation of
Saskatchewan Inc. or its agent that such financial institution will comply with
the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue
Code of 1986, as amended, and the regulations thereunder), or (iii) is owned by
United States or foreign financial institution(s) for purposes of resale during
the restricted period (as defined in United States Treasury Regulations Section
1.163-5(c)(2)(i)(D)(7)), and, to the further effect, that financial
institutions described in clause (iii) above (whether or not also described in
clause (i) or (ii)) have certified that they have not acquired Securities for
purposes of resale directly or indirectly to a United States person or to a
person within the United States or its possessions.
As used herein, "United States" means the United States of
America (including the States and the District of Columbia); and its
"possessions" include Puerto Rico, the U.S. Virgin Islands, Guam, American
Samoa, Wake Island and the Northern Mariana Islands.
We further certify that (i) we are not making available
herewith for exchange (or, if relevant, collection of any interest) any portion
of the temporary global Security representing the above-captioned Securities
excepted in the above referenced certificates of Member Organizations and (ii)
as of the date hereof we have not received any notification from any of our
Member Organizations to the effect that the statements made by such Member
Organizations with respect to
<PAGE> 97
any portion of the part submitted herewith for exchange (or, if relevant,
collection of any interest) are no longer true and cannot be relied upon as of
the date hereof.
We understand that this certification is required in
connection with certain tax legislation in the United States. If administrative
or legal proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certificate or a copy thereof to any interested party in such proceedings.
Dated: __________________19__
[To be dated no earlier than the Exchange Date
or the relevant Interest Payment Date occurring
prior to the Exchange Date, as applicable]
[____________________] as
Operator of the
Euroclear System
[Cedel S.A.]
By:
------------------------
<PAGE> 1
EXHIBIT 5
[ROBERTSON STROMBERG LETTERHEAD]
May 23, 1997
Potash Corporation of Saskatchewan Inc.
#500, 122 - 1st Avenue South
Saskatoon, SK S7K 7G3
Dear Sirs:
We have acted as Saskatchewan counsel to Potash Corporation of Saskatchewan Inc.
("PCS") in connection with any Form S-3 Registration Statement (the
"Registration Statement") filed by PCS with the Securities and Exchange
Commission under the U.S. Securities Act of 1933, as amended (the "Act"),
relating to the offering from time to time, as set forth in the prospectus
contained in such Registration Statement (the "Prospectus"), and as to be set
forth in one or more supplements to the Prospectus (each, a "Prospectus
Supplement") of up to $1,000,000,000 aggregate offering price of one or more
series of debt securities (the "Securities").
The Securities will be issued pursuant to an indenture in the form attached as
an exhibit to the Registration Statement (the "Indenture") between PCS and The
Bank of Nova Scotia Trust Company of New York (the "Trustee").
We have examined and relied upon the originals or copies of such records,
agreements, documents and other instruments and have made such inquiries of such
officers and representatives as we have deemed relevant and necessary as the
basis of the opinions set forth. In such examination, we have assumed, without
independent verification, the genuineness of all signatures (whether original or
photostatic), the legal capacity of natural persons, the authenticity of all
documents submitted to us as originals, and the conformity to original documents
of all documents submitted to us as certified or photostatic copies. We have
assumed, with independent verification, the accuracy of the relevant facts
stated therein.
Based upon the foregoing and subject to the qualifications set forth below, we
are of the opinion that the Securities have been duly authorized by PCS and when
the Securities have been duly issued pursuant to the Registration Statement and
by the Indenture including, without limitation, the provisions of Section 3.01
of the Indenture, duly authenticated by the Trustee and duly executed and
delivered on behalf of PCS against payment therefor in accordance with the terms
and provisions of the Indenture and as contemplated by the Registration
Statement and/or the
<PAGE> 2
Page 2
applicable Prospectus Supplement, the Securities will be validly issued and
constitute binding obligations of PCS.
To the extent that the obligations of PCS under the Indenture may be dependent
upon such matters, we assume for purposes of this opinion that the Trustee is
duly organized, validly existing and in good standing under the laws of the
jurisdiction of organization of such Trustee; that the Trustee is in compliance
generally with respect to acting as a trustee under the Indenture and with all
applicable laws and regulations; and that the Trustee has the requisite
organizational and legal power and authority to perform its obligations under
the Indenture.
We are members of the Law Society of Saskatchewan, as such, are only qualified
to express our opinions with respect to the laws of the Province of
Saskatchewan and the federal laws of Canada applicable thereto, effective as
of the date hereof. We have made no investigation of the laws of any
jurisdiction other than the Province of Saskatchewan and the laws of Canada
applicable thereto.
We consent to the filing of this opinion as an exhibit to the Registration
Statement and to the reference to our firm under the caption "Legal Matters" in
the Prospectus. In giving this consent, we do not hereby admit that we have
come within the category of persons whose consent is required under Section 7
of the Act or the General Rule and Regulation thereunder.
Yours truly,
/s/ ROBERTSON STROMBERG
- --------------------------
ROBERTSON STROMBERG
<PAGE> 1
EXHIBIT 12
POTASH CORPORATION OF SASKATCHEWAN INC.
RATIO OF EARNINGS TO FIXED CHARGES
(IN THOUSANDS OF US DOLLARS, EXCEPT RATIO AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31 YEAR ENDED DECEMBER 31
--------------------- ---------------------------------------------------------------
1997 1996 1996 1996 1995 1994 1993 1992
(Pro forma)
--------------------- ---------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C> <C>
Net income $56,365 $63,678 $209,036 $353,887 $159,486 $91,219 $44,697 $39,875
Interest on debt 13,818 13,842 46,761 103,123 41,817 3,772 8,686 8,335
Interest on operating leases 3,762 2,411 9,642 15,046 7,830 3,404 3,267 3,587
Income taxes 20,330 9,602 43,695 123,862 22,946 3,484 3,486 2,377
--------------------- ---------------------------------------------------------------
$94,275 $89,533 $309,134 $595,718 $232,079 $101,879 $60,136 $54,174
===================== ===============================================================
Total Fixed Charges $17,580 $16,253 $56,403 $118,169 $49,647 $7,176 $11,953 $11,922
===================== ===============================================================
Ratio of Earnings to Fixed Charges 5.36 5.51 5.48 5.04 4.67 14.20 5.03 4.54
===================== ===============================================================
</TABLE>
<PAGE> 1
EXHIBIT 23(a)
[DELOITTE & TOUCHE LETTERHEAD]
CONSENT OF INDEPENDENT CHARTERED ACCOUNTANTS
POTASH CORPORATION OF SASKATCHEWAN INC.
We hereby consent to the incorporation of our report dated February 12, 1997,
incorporated by reference in the Annual Report on Form 10-K of Potash
Corporation of Saskatchewan Inc. ("PCS") for the year ended December 31, 1996,
into PCS's Registration Statement on Form S-3 for the registration of
$1,000,000,000 of its Debt Securities.
/s/ DELOITTE & TOUCHE
DELOITTE & TOUCHE
Chartered Accountants
Saskatoon, Saskatchewan, Canada
May 23, 1997
<PAGE> 1
EXHIBIT 23(b)
We hereby consent to the reference to our firm in this Registration Statement
under the heading "Legal Matters." In giving this consent, we do not hereby
admit that we come within the category of persons whose consent is required
under Section 7 of the Securities Act of 1933, as amended.
/s/ Arent Fox Kintner Plotkin & Kahn
------------------------------------
Arent Fox Kintner Plotkin & Kahn
May 23, 1997
<PAGE> 1
EXHIBIT 23(d)
We consent to the incorporation by reference in the registration statement on
Form S-3 of Potash Corporation of Saskatchewan Inc. of our report dated
February 12, 1997, with respect to the consolidated balance sheets of Arcadian
Corporation and subsidiaries as of December 31, 1996 and 1995, and the related
consolidated statements of operations, stockholders' equity, and cash flows for
each of the years in the three-year period ended December 31, 1996 and to the
reference to our firm under the heading "Experts" in the registration
statement.
KPMG Peat Marwick LLP
/s/ KPMG PEAT MARWICK LLP
Memphis, Tennessee
May 23, 1997
<PAGE> 1
EXHIBIT 23(e)
ACCOUNTANTS' CONSENT
We consent to the use of our report, dated 10th January, 1997, with
respect to the balance sheet of Arcadian Trinidad Limited as of 31st December,
1996 and 1995 and the related profit and loss account, shareholders' equity and
cash flow statements for the years then ended, incorporated herein by reference,
and to the reference to our firm under the heading of "Experts" in the
Prospectus.
/s/ COOPERS & LYBRAND
- -----------------------
Coopers & Lybrand
Chartered Accountants
Port of Spain
Trinidad, W.I.
23rd May, 1997
<PAGE> 1
EXHIBIT 25
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 BANK OF NOVA SCOTIA TRUST COMPANY OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5691211
(State of Incorporation (I.R.S. employer
If not a U.S. national bank) Identification number)
One Liberty Plaza
New York, N.Y. 10006
(Address of principal (Zip code)
Executive office)
POTASH CORPORATION OF SASKATCHEWAN INC.
(Exact name of obligor as specified in its charter)
SASKATCHEWAN, CANADA
(State or other jurisdiction of incorporation or organization)
N/A
(I.R.S. employer identification no.)
122- 1st Ave. S., Suite 500
Saskatoon, Saskatchewan
Canada, S7K 7G3
(Address of principal executive offices) (Postal Code)
DEBT SECURITIES
(Title of the indenture securities)
<PAGE> 2
-2-
Item 1. General Information
Furnish the following information as to the
trustee:
(a) Name and address of each examining or supervising
authority to which it is subject.
Federal Reserve Bank of New York
33 Liberty Street
New York, N. Y. 10045
State of New York Banking Department
State House, Albany, N.Y.
(b) Whether it is authorized to exercise corporate trust
powers.
The Trustee is authorized to exercise
corporate trust powers.
Item 2. Affiliation with the Obligor.
If the obligor is an affiliate of the
trustee, describe each such affiliation.
The obligor is not an affiliate of the
Trustee.
Item 16. List of Exhibits.
List below all exhibits filed as part of
this statement of eligibility.
Exhibit 1 - Copy of the Organization Certificate of the Trustee
as now in effect. (Exhibit 1 to T-1 to Registration
Statement No. 333-6688).
Exhibit 2 - Copy of the Certificate of Authority of the Trustee
to commerce business. (Exhibit 2 to T-1 to
Registration Statement No. 333-6688).
Exhibit 3 - None; authorization to exercise corporate trust
powers is contained in the documents identified
above as Exhibit 1 and 2.
Exhibit 4 - Copy of the existing By-Laws of the Trustee.
(Exhibit 4 to T-1 to Registration Statement No.
333-6688).
Exhibit 5 - No Indenture referred to in Item 4.
Exhibit 6 - The consent of the Trustee required by Section
321(b) of the Trust Indenture Act of 1939
(attached).
Exhibit 7 - Copy of the latest Report of Condition of the
Trustee as of March 31, 1997 (attached).
<PAGE> 3
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
Trustee, The Bank of Nova Scotia Trust Company of New York, a corporation
organized and existing under the laws of the State of New York, has duly caused
this statement of eligibility to be signed on its behalf by the undersigned,
thereunto duly authorized, all in the City of New York, and State of New York,
on the 23rd day of May, 1997.
THE BANK OF NOVA SCOTIA TRUST
COMPANY OF NEW YORK
By: /s/ GEORGE E. TIMMES
--------------------------
George E. Timmes
Secretary
<PAGE> 4
EXHIBIT 6 to Form T-1
SECTION 321(b) CONSENT
----------------------
Pursuant to the requirements of Section 321(b) of the Trust Indenture
Act of 1939, The Bank of Nova Scotia Trust Company of New York, a corporation
organized and existing under the laws of the State of New York (the "Bank"),
hereby consents that subject to the provisions of said Section 321(b), reports
of examinations of the Bank by federal, state, territorial or district
authorities may be furnished by such authorities to the Securities and Exchange
Commission upon request therefor.
THE BANK OF NOVA SCOTIA TRUST
COMPANY OF NEW YORK
By: /s/ GEORGE E. TIMMES
----------------------------
George E. Timmes
Secretary
<PAGE> 5
EXHIBIT 7
[FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL]
[ LETTERHEAD ]
- -------------------------------------------------------------------------------
CONSOLIDATED REPORTS OF CONDITION AND INCOME FOR A BANK WITH DOMESTIC OFFICES
ONLY AND TOTAL ASSETS OF LESS THAN $100 MILLION - FFIEC 034
REPORT AT THE CLOSE OF BUSINESS MARCH 31, 1997 (961231)
This report is required by law: 12 U.S.C. Section 324 (State member banks);
12 U.S.C. Section 1817 (state nonmember banks); and 12 U.S.C. Section 161
(National banks).
- -------------------------------------------------------------------------------
This report form is to be filed by banks with domestic offices only. Banks with
branches and consolidated subsidiaries in U.S. territories and possessions, Edge
or Agreement subsidiaries, foreign branches, consolidated subsidiaries, or
International Banking Facilities must file FFIEC 031.
- -------------------------------------------------------------------------------
NOTE: The Reports of Condition and Income must be signed by an authorized
officer and the Report of Condition must be attested to by not less than two
directors (trustees) for State nonmember banks and three directors for State
member and National banks.
I, J.F. Neylan, Assistant Secretary
---------------------------------------------------
Name and Title of Officer Authorized to Sign Report
of the named bank do hereby declare that these Reports of Condition and Income
(including the supporting schedules) have been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and are
true to the best of my knowledge and belief.
[SIG]
- -----------------------------------------------------
Signature of Officer Authorized to Sign Report
May 6, 1997
- -----------------------------------------------------
Date of Signature
The Reports of Condition and Income are to be prepared in accordance with
Federal regulatory authority instructions.
NOTE: These instructions may in some cases differ from generally accepted
accounting principles.
We, the undersigned directors (trustees), attest to the correctness of this
Report of Condition (including the supporting schedules) and declare that it has
been examined by us and to the best of our knowledge and belief has been
prepared in conformance with the instructions issued by the appropriate Federal
regulatory authority and is true and correct.
[SIG]
- -----------------------------------------------------
Director (Trustee)
[SIG]
- -----------------------------------------------------
Director (Trustee)
- -----------------------------------------------------
Director (Trustee)
- -------------------------------------------------------------------------------
For Banks Submitting Hard Copy Report Forms:
State Member Banks: Return the original and one copy to the appropriate Federal
Reserve District Bank.
State Nonmember Banks: Return the original only in the special return address
envelope provided. If express mail is used in lieu of the special return
address envelope, return the original only to the FDIC, c/o Quality Data
Systems, 2127 Espey Court, Suite 204, Crofton, MD 21114.
National Banks: Return the original only in the special return address envelope
provided. If express mail is used in lieu of the special return address
envelope, return the original only to the FDIC, c/o Quality Data Systems,
2127 Espey Court, Suite 204, Crofton, MD 21114.
- -------------------------------------------------------------------------------
FDIC Certificate Number |__|__|__|__|__|
___
| Banks should affix the address label in this space.
The Bank of Nova Scotia Trust Company of New York
-------------------------------------------------
Legal Title of Bank
New York
-------------------------------------------------
City
NY 10006
-------------------------------------------------
| State Abbrev. Zip Code
---
Board of Governors of the Federal Reserve System, Federal Deposit Insurance
Corporation, Office of the Comptroller of the Currency
<PAGE> 6
The Bank of Nova Scotia Trust Company of New York
- -------------------------------------------------
Legal Title of Bank
New York
- -------------------------------------------------
City
NY 10006
- -------------------------------------------------
State Zip Code
FDIC Certificate Number | | | | | |
-----------
CONSOLIDATED REPORT OF INCOME
FOR THE PERIOD JANUARY 1, 1997 -- MARCH 31, 1997
ALL REPORT OF INCOME SCHEDULES ARE TO BE REPORTED ON A CALENDAR YEAR-TO-DATE
BASIS IN THOUSANDS OF DOLLARS.
SCHEDULE RI -- INCOME STATEMENT
<TABLE>
<Caption)
------------
| l180
-----------------
Dollar Amounts in Thousands | | Mil Thou
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Interest income:
a. Interest and fee income on loans(1)(2):
(1) Total loans (to be completed only by those banks with less than $25 million in
total assets) ..................................................................................... NONE
The following four items are to be completed only by those banks with $25 million or more
in total assets(1)(2):
(2) Real estate loans ................................................................................. NONE
(3) Installment loans ................................................................................. NONE
(4) Credit cards and related plans .................................................................... NONE
(5) Commercial (time and demand) and all other loans .................................................. NONE
b. Income from lease financing receivables ............................................................... NONE
c. Interest income on balances due from depository institutions(3) ....................................... NONE
d. Interest and dividend income on securities:
(1) Securities issued by states and political subdivisions in the U.S.:
(a) Taxable securities ............................................................................ NONE
(b) Tax-exempt securities ......................................................................... 29
(2) U.S. Government and other debt securities ......................................................... 1
(3) Equity securities (including investments in mutual funds) ......................................... NONE
e. Interest income from trading assets ................................................................... NONE
f. Interest income on federal funds sold(4) and securities purchased under agreements to resell .......... 40
g. Total interest income (sum of items 1.a through 1.f) .................................................. 70
</TABLE>
- ---------------
(1) See instructions for loan classifications used in this schedule.
(2) The $25 million asset size test is generally based on the total assets
reported on the June 30, 1995 Report of Condition.
(3) Includes interest income on time certificates of deposit not held for
trading.
(4) Report interest income on "term federal funds sold" in Schedule R1,
Item 1,a., "Interest and fee income on loans."
<PAGE> 7
SCHEDULE RI -- CONTINUED
<TABLE>
<CAPTION>
Year-to-date
-----------------
Dollar Amounts in Thousands Mil Thou
-----------------
<S> <C> <C>
2. Interest expense:
a. Interest on deposits:
(1) Transaction accounts (NOW accounts, ATS accounts, and telephone
and preauthorized transfer accounts)............................... NONE
(2) Nontransaction accounts:
(a) Money market deposit accounts (MMDAs).......................... NONE
(b) Other savings deposits......................................... NONE
(c) Time certificates of deposit of $100,000 or more............... NONE
(d) All other time deposits(1)..................................... 5
b. Expense of federal funds purchased(2) and securities sold under
agreements to repurchase............................................... NONE
c. Interest on demand notes issued to the U.S. Treasury, trading
liabilities, and other borrowed money.................................. NONE
d. Interest on mortgage indebtedness and obligations under capitalized
leases................................................................. NONE
e. Interest on subordinated notes and debentures.......................... NONE
f. Total interest expense (sum of items 2.a through 2.e).................. 5
3. Net interest income (item 1.g minus 2.f)................................... 65
4. Provisions:
a. Provision for loan and lease losses.................................... NONE
b. Provision for allocated transfer risk.................................. NONE
5. Noninterest income:
a. Service charges on deposit accounts.................................... NONE
b. Other noninterest income:
(1) Other fee income.................................................. NONE
(2) All other noninterest income*..................................... 184
c. Total noninterest income (sum of items 5.a and 5.b).................... 184
6. a. Realized gains (losses) on held-to-maturity securities................. NONE
b. Realized gains (losses) on available-for-sale securities............... NONE
7. Noninterest expense:
a. Salaries and employee benefits......................................... 80
b. Expenses of premises and fixed assets (net of rental income)
(excluding salaries and employee benefits and mortgage interest)....... 28
c. Other noninterest expense*............................................. 40
d. Total noninterest expense (sum of items 7.a. through 7.c .............. 148
8. Income (loss) before income taxes and extraordinary items and other
adjustments (item 3 plus or minus items 4.a, 4.b, 5.c, 6.a, 6.b, and 7.d).. 101
9. Applicable income taxes (on Item 8) ....................................... 18
10. Income (loss) before extraordinary items and other adjustments (item 8
minus 9)................................................................... 83
11. Extraordinary items and other adjustments:
a. Extraordinary items and other adjustments, gross of income taxes*...... NONE
b. Applicable income taxes (on item 11.a)*................................ NONE
c. Extraordinary items and other adjustments, net of income taxes
(item 11.a minus 11.b)................................................. NONE
12. Net income (loss) (sum of items 10 and 11.c)............................... 83
</TABLE>
- -----------------------
1 Includes interest expense on open-account time deposits of $100,000 or more.
2 Report the expense of "term federal funds purchased" in Schedule RI, item
2.c. "interest on demand notes issued to the U.S. Treasury, trading
liabilities, and other borrowed money."
3 Describe on Schedule RI-E-Explanations.
* Interest on security deposits.
<PAGE> 8
The Bank of Nova Scotia Trust Company of New York
- -------------------------------------------------
Legal Title of Bank
FDIC Certificate Number | | | | | |
-----------
SCHEDULE RI -- CONTINUED
<TABLE>
<Caption)
Memoranda ------------
I181
-----------------
Year-to-date
-----------------
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Interest expense incurred to carry tax-exempt securities, loans, and leases acquired after
August 7, 1986, that is not deductible for federal income tax purposes ................................... NONE
2. Income from the sale and servicing of mutual funds and annuities (included in
Schedule RI, Item 8) ..................................................................................... NONE
3. Estimated income on tax-exempt loans and leases to states and political subdivisions in the U.S.
(reportable in Schedule RC-C, part I, Items 7 and 9) included in Schedule RI, items 1.a and 1.b,
above (excludes income on tax-exempt securities) ......................................................... NONE
4. Number of full-time equivalent employees on payroll at end of current period (round to nearest
whole number) ............................................................................................ 5
5. Cash dividends declared during the calendar year to date
(to be reported only with March, June, and September Reports of Income) .................................. NONE
6. To be completed by banks with $25 million or more in total assets and with loans to finance
agricultural production and other loans to farmers (Schedule RC-C, part I, item 3) exceeding
five percent of total loans.(2)
Interest and fee income on agricultural loans(1) (included in Item 1.a above) ............................
7. If the reporting bank has restated its balance sheet as a result of applying push down MM DD YR
accounting this calendar year, report the date of the bank's acquisition .................................
---------------
</TABLE>
- ---------------
(1) See instructions for loan classifications used in this schedule.
(2) The $25 million asset size test and the five percent of total loans test
are generally based on the total assets reported on the June 30, 1995
Report of Condition.
SCHEDULE RI-A -- CHANGES IN EQUITY CAPITAL
SCHEDULE RI-A IS TO BE REPORTED WITH THE DECEMBER REPORT OF INCOME.
Indicate decreases and losses in parentheses.
<TABLE>
<CAPTION>
------------
I183
-----------------
Indicate decreases and losses in parentheses. Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C>
1. Total equity capital originally reported in the December 31, 1995, Reports of Condition and Income .......
2. Equity capital adjustments from amended Reports of Income, net* ..........................................
3. Amended balance end of previous calendar year (sum of items 1 and 2) .....................................
4. Net income (loss) (must equal Schedule RI, item 12) ......................................................
5. Sale, conversion, acquisition, or retirement of capital stock, net .......................................
6. Changes incident to business combinations, net ...........................................................
7. LESS: Cash dividends declared on preferred stock .........................................................
8. LESS: Cash dividends declared on common stock ............................................................
9. Cumulative effect of changes in accounting principles from prior years* (see instructions for
this schedule) ...........................................................................................
10. Corrections of material accounting errors from prior years* (see instructions for this schedule) .........
11. Change in net unrealized holding gains (losses) on available-for-sale securities .........................
12. Other transactions with parent holding company* (not included in items 5, 7, or 8 above) .................
13. Total equity capital end of current period (sum of items 3 through 12) (must equal
Schedule RC, item 28.a) ..................................................................................
</TABLE>
- ---------------
*Describe on Schedule RI-E - Explanations.
<PAGE> 9
Schedule RI-B--Charge-offs and Recoveries and Changes in Allowance
for Loan and Lease Losses
Part I. Charge-offs and Recoveries on Loans and Leases(1)
<TABLE>
<CAPTION>
I186
----------------------------------
(Column A) (Column B)
Charge-offs Recoveries
----------------------------------
Calendar year-to-date
----------------------------------
Dollar Amounts in Thousands Mil Thou Mil Thou
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Real estate loans.................................................................
2. Installment loans.................................................................
3. Credit cards and related plans....................................................
4. Commercial (time and demand) and all other loans..................................
5. Lease financing receivables.......................................................
6. Total (sum of items 1 through 5).................................................. NONE NONE
Memoranda
----------------------------------
Dollar Amounts in Thousands Mil Thou Mil Thou
- --------------------------------------------------------------------------------------------------------------------------
1. To be completed by banks with loans to finance agricultural production and
other loans to farmers (Schedule RC-C, part I, item 3) exceeding five percent
of total loans.
Agricultural loans included in part I, items 1 through 4, above...................
2.-3. Not applicable
4. Loans to finance commercial real estate, construction, and land development
activities (not secured by real estate) included in Schedule RI-B, part I,
items 2 through 4, above..........................................................
5. Real estate loans (sum of Memorandum items 5.a through 5.e must equal
Schedule RI-B, part I, item 1, above):
a. Construction and land development..............................................
b. Secured by farmland............................................................
c. Secured by 1-4 family residential properties:
(1) Revolving, open-end loans secured by 1-4 family residential properties
and extended under lines of credit.......................................
(2) All other loans secured by 1-4 family residential properties.............
d. Secured by multifamily (5 or more) residential properties......................
e. Secured by nonfarm nonresidential properties...................................
</TABLE>
- ------------------
(1) See instructions for loan classifications used in this schedule.
<PAGE> 10
The Bank of Nova Scotia Trust Company of New York
- -------------------------------------------------
Legal Title of Bank
FDIC Certificate Number |__|__|__|__|__|
SCHEDULE RI-B -- Continued
Part II. Changes in Allowance for Loan and Lease Losses
Part II is to be reported with the December Report of Income.
<TABLE>
<CAPTION>
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Balance originally reported in the December 31, 1995, Reports of Condition and Income............
2. Recoveries (must equal part I, item 6, column B above) ..........................................
3. LESS: Charge-offs (must equal part I, item 6, column A above) ...................................
4. Provision for loan and lease losses (must equal Schedule RI, item 4.a) ..........................
5. Adjustments* (see instructions for this schedule) ...............................................
6. Balance end of current period (sum of items 1 through 5) (must equal Schedule RC, item 4.b)......
-------------
</TABLE>
- -----------
* Describe on Schedule RI-E -- Explanations
SCHEDULE RI-C -- APPLICABLE INCOME TAXES BY TAXING AUTHORITY
Schedule RI-C is to be reported with the December Report of Income.
<TABLE>
<CAPTION>
I189
------------------
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Federal .........................................................................................
2. State and local .................................................................................
3. Total (sum of items 1 and 2) (must equal sum of Schedule RI, items 9 and 11.b) ..................
4. Deferred portion of item 3 ......................................................................
------------------------------------
</TABLE>
SCHEDULE RI-E -- EXPLANATIONS
Schedule RI-E is to be completed each quarter on a calendar year-to-date basis.
Detail all adjustments in Schedule RI-A and RI-B, all extraordinary items and
other adjustments in Schedule RI, and all significant items of other noninterest
income and other noninterest expense in Schedule RI. (See instructions for
details.)
<TABLE>
<CAPTION>
I195
------------------
Year-to-Date
------------------
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. All other noninterest income (from Schedule RI, item 5.b.(2))
Report amounts that exceed 10% of Schedule RI, item 5.b.(2):
a. Net gains on other real estate owned ........................................................
b. Net gains on sales of loans .................................................................
c. Net gains on sales of premises and fixed assets .............................................
Itemize and describe the three largest other amounts that exceed 10% of Schedule RI, item 5.b.(2):
d. Fees & Commission -- Agency 164
--------------------------------------------------------------------------------------------- --------------------
e. Mtg. Tech Service Fees 20
--------------------------------------------------------------------------------------------- --------------------
f.
--------------------------------------------------------------------------------------------- --------------------
2. Other noninterest expense (from Schedule RI, item 7.c):
a. Amortization expense of intangible assets.....................................................
Report amounts that exceed 10% of Schedule RI, item 7.c:
b. Net losses on other real estate owned.........................................................
c. Net losses on sales of loans..................................................................
d. Net losses on sales of premises and fixed assets..............................................
Itemize and describe the three largest other amounts that exceed 10% of Schedule RI, item 7.c:...
e. Office Supplies 4
--------------------------------------------------------------------------------------------- --------------------
f. Directors Fees & Expenses 4
--------------------------------------------------------------------------------------------- --------------------
g. Audit Expenses 14
--------------------------------------------------------------------------------------------- --------------------
</TABLE>
<PAGE> 11
SCHEDULE RI-E -- CONTINUED
<TABLE>
<CAPTION>
YEAR-TO-DATE
------------------
Dollar Amounts in Thousands Mil Thou
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
3. Extraordinary items and other adjustments (from Schedule RI, item 11.a) and applicable income
tax effect (from Schedule RI; item 11.b) (itemize and describe all extraordinary items and other
adjustments:
------------------
a.(1)
--------------------------------------------------------------------------------------------------------------------
(2) Applicable income tax effect
--------------------------------
b.(1)
--------------------------------------------------------------------------------------------------------------------
(2) Applicable income tax effect
-------------------------------
c.(1)
--------------------------------------------------------------------------------------------------------------------
(2) Applicable income tax effect
----------------
4. Equity capital adjustments from amended Reports of Income (from Schedule RI-A, item 2)
(itemize and describe all adjustments):
a.
---------------------------------------------------------------------------------------------------- ------------------
a.
---------------------------------------------------------------------------------------------------- ------------------
5. Cumulative effect of changes in accounting principles from prior years
(from Schedule RI-A, item 9) (itemize and describe all changes in accounting principles):
a.
---------------------------------------------------------------------------------------------------- ------------------
a.
---------------------------------------------------------------------------------------------------- ------------------
6. Corrections of material accounting errors from prior years (from Schedule RI-A, item 10)
(itemize and describe all adjustments):
a.
---------------------------------------------------------------------------------------------------- ------------------
a.
---------------------------------------------------------------------------------------------------- ------------------
7. Other transactions with parent holding company (from Schedule RI-A, item 12)
(itemize and describe all such transactions):
a.
---------------------------------------------------------------------------------------------------- ------------------
a.
---------------------------------------------------------------------------------------------------- ------------------
8. Adjustments to allowance for loan and lease losses (from Schedule RI-B, part II, item 5)
(itemize and describe all adjustments):
a.
---------------------------------------------------------------------------------------------------- ------------------
a.
---------------------------------------------------------------------------------------------------- ------------------
9. Other explanations (the space below is provided for the bank to briefly describe, at its option, I198 I199
any other significant items affecting the Report of Income): ----------------------
No comment [ ]
Other explanations (please type or print clearly):
</TABLE>
<PAGE> 12
The Bank of Nova Scotia Trust Company of New York
------------------------------------------------------------------
Legal Title of Bank
New York
------------------------------------------------------------------
City
NY 10006
------------------------------------------------------------------
State Zip Code
|__ __|
FDIC Certificate Number [___________]
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 as of the last business day of the
quarter.
SCHEDULE RC -- BALANCE SHEET
<TABLE>
<CAPTION>
-----------
C100
-----------------
Dollar Amounts in Thousands Mil Thou
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
1. Cash and balances due from depository institutions:
a. Noninterest-bearing balances and currency and coin(1,2) ............................................ 253
-----------
b. Interest-bearing balances(3) ....................................................................... NONE
-----------
2. Securities:
a. Held-to-maturity securities (from Schedule RC-B, column A) ......................................... 1 885
-----------
b. Available-for-sale securities (from Schedule RC-B, column D) ....................................... NONE
-----------
3. Federal funds sold and securities purchased under agreements to resell:
a. Federal funds sold(4) .............................................................................. NONE
-----------
b. Securities purchased under agreements to resell(5) ................................................. 2 200
-----------
4. Loans and lease financing receivables: -----------
a. Loans and leases, net of unearned income (from Schedule RC-C) ................
-----------
b. LESS: Allowance for loan and lease losses ....................................
-----------
c. LESS: Allocated transfer risk reserve ........................................
-----------
d. Loans and leases, net of unearned income, allowance, and reserve (item 4.a
minus 4.b and 4.c) ................................................................................. NONE
-----------
5. Trading assets......................................................................................... NONE
-----------
6. Premises and fixed assets (including capitalized leases) .............................................. 4
-----------
7. Other real estate owned (from Schedule RC-M) .......................................................... NONE
-----------
8. Investments in unconsolidated subsidiaries and associated companies (from Schedule RC-M) .............. NONE
-----------
9. Customers' liability to this bank on acceptances outstanding .......................................... NONE
-----------
10. Intangible assets (from Schedule RC-M) ................................................................ NONE
-----------
11. Other assets (from Schedule RC-F) ..................................................................... 75
-----------
12. a. Total assets (sum of items 1 through 11) ........................................................... 4 417
-----------
b. Losses deferred pursuant to 12 U.S.C. 1823(j) ...................................................... NONE
-----------
c. Total assets and losses deferred pursuant to 12 U.S.C. 1823(j) (sum of items 12.a and 12.b) ........ 4 417
-----------
</TABLE>
- -------------
(1) Includes cash items in process of collection and unposted debits.
(2) The amount reported in this item must be greater than or equal to the sum of
Schedule RC-M, items 3.a and 3.b.
(3) Includes time certificates of deposit not held for trading.
(4) Report "term federal funds sold" in Schedule RC, item 4.a, "Loans and
leases, net of unearned income," and in Schedule RC-C, part I.
(5) Report securities purchased under agreements to resell that involve the
receipt of immediately available funds and mature in one business day or
roll over under a continuing contract in Schedule RC, item 3.a, "Federal
funds sold."
<PAGE> 13
Schedule RC - Continued
<TABLE>
<CAPTION>
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C from Schedule RC-E)................... 2 102
(1) Noninterest-bearing(1).................................................... 1 148
(2) Interest-bearing.......................................................... 954
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs...............................
(1) Noninterest-bearing.....................................................................
(2) Interest-bearing........................................................................
14. Federal funds purchased and securities sold under agreements to repurchase:
a. Federal funds purchased(2).................................................................. NONE
b. Securities sold under agreements to repurchase(3)........................................... NONE
15. a. Demand notes issued to the U.S. Treasury.................................................... NONE
b. Trading liabilities......................................................................... NONE
16. Other borrowed money:
a. With a remaining maturity of one year or less............................................... NONE
b. With a remaining maturity of more than one year............................................. NONE
17. Mortgage indebtedness and obligations under capitalized leases.................................. NONE
18. Bank's liability on acceptances executed and outstanding........................................ NONE
19. Subordinated notes and debentures............................................................... NONE
20. Other liabilities (from Schedule RC-G).......................................................... 34
21. Total liabilities (sum of items 13 through 20).................................................. 2 136
22. Limited-life preferred stock and related surplus................................................ NONE
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................................................... NONE
24. Common stock.................................................................................... 1 000
25. Surplus (exclude all surplus related to preferred stock)........................................ 1 000
26. a. Undivided profits and capital reserves....................................................... 281
b. Net unrealized holding gains (losses) on available-for-sale-securities....................... NONE
27. Cumulative foreign currency translation adjustments.............................................
28. a. Total equity capital (sum of items 23 through 27)............................................ 2 281
b. Losses deferred pursuant to 12 U.S.C. 1823(j)................................................ NONE
c. Total equity capital and losses deferred pursuant to 12 U.S.C. 1823(j) (sum of items
28.a and 28.b)............................................................................... 2 281
29. Total liabilities, limited-life preferred stock, equity capital, and losses deferred
pursuant to 12 U.S.C. 1823(j) (sum of items 21, 22, and 28.c)................................... 4 417
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
<TABLE>
<CAPTION>
Number
------
<S> <C>
1. Indicate in the box at the right the number of the statement below that best describes the most
comprehensive level of auditing work performed for the bank by independent external auditors
as of any date during 1995...................................................................... 1
</TABLE>
<TABLE>
<S> <C>
1 = Independent audit of the bank conducted in accordance with 4 = Directors' examination of the bank performed
generally accepted auditing standards by a certified public by other external auditors (may be required by state
accounting firm which submits a report on the bank chartering authority)
2 = Independent audit of the bank's parent holding company con- 5 = Review of the bank's financial statements by external
ducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which submits 6 = Compilation of the bank's financial statements by
a report on the consolidated holding company (but not on the external auditors
bank separately) 7 = Other audit procedures (excluding tax preparation
3 = Directors' examination of the bank conducted in accordance with work)
generally accepted auditing standards by a certified public 8 = No external audit work
accounting firm (may be required by state chartering authority)
</TABLE>
- --------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
(2) Report "term federal funds purchased" in Schedule RC, item 16, "Other
borrowed money."
(3) Report securities sold under agreements to repurchase that involve the
receipt of immediately available funds and mature in one business day or
roll over under a continuing contract in Schedule RC, item 14.a. "Federal
funds purchased."
<PAGE> 14
Schedule RC-B--Securities
Exclude assets held for trading.
<TABLE>
<CAPTION>
C110
-----------------------------------------------------------------------------
Held-to-maturity Available-for-sale
----------------------------------- ---------------------------------------
(Column A) (Column B) (Column C) (Column D)
Amortized Cost Fair Value Amortized Cost Fair Value(1)
---------------- ---------------- ------------------ -----------------
Dollar Amounts in Thousands Mil Thou Mil Thou Mil Thou Mil Thou
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1. U.S. Treasury securities .................. 98 98
2. U.S. Government agency and
corporation obligations (exclude
mortgage-backed securities):
a. Issued by U.S. Government
agencies(2) ............................ NONE NONE
b. Issued by U.S. Government-
sponsored agencies(3) .................. NONE NONE
3. Securities issued by states and
political subdivisions in the U.S.:
a. General obligations..................... 1 382 1 371
b. Revenue obligations..................... 405 405
c. Industrial development and similar
obligations............................. NONE NONE
4. Mortgage-backed securities (MBS):
a. Pass-through securities:
(1) Guaranteed by GNMA.................. NONE NONE
(2) Issued by FNMA and FHLMC............ NONE NONE
(3) Other pass-through securities....... NONE NONE
b. Other mortgage-backed securities
(include CMOs, REMICs, and stripped MBS):
(1) Issued or guaranteed by FNMA, FHLMC,
or GNMA............................. NONE NONE
(2) Collateralized by MBS issued or
guaranteed by FNMA, FHLMC, or GNMA.. NONE NONE
(3) All other mortgage-backed
securities.......................... NONE NONE
5. Other debt securities...................... NONE NONE
6. Equity securities:
a. Investments in mutual funds.............
b. Other equity securities with readily
determinable fair values................
c. All other equity securities(1) (includes
Federal Reserve stock)..................
7. Total (sum of items 1 through 6) (total of
column A must equal Schedule RC, item 2.a)
(total of column D must equal Schedule RC,
item 2.b).................................. 1 885 1 874
</TABLE>
- -----------------
(1) Includes equity securities without readily determinable fair values at
historical cost in item 6.c, column D.
(2) Includes Small Business Administration "Guaranteed Loan Pool Certificates,"
U.S. Maritime Administration obligations, and Export-Import Bank
participation certificates.
(3) Includes obligations (other than mortgage-backed securities) issued by the
Farm Credit System, the Federal Home Loan Bank System, the Federal Home Loan
Mortgage Corporation, the Federal National Mortgage Association, the
Financing Corporation, Resolution Funding Corporation, the Student Loan
Marketing Association, and the Tennessee Valley Authority.
<PAGE> 15
The Bank of Nova Scotia Trust Company of New York
- -------------------------------------------------
Legal Title of Bank
FDIC Certificate Number |__|__|__|__|__|
Schedule RC-B--Continued
<TABLE>
<CAPTION>
C112
Memoranda -------------------------
Dollar Amounts in Thousands Mil Thou
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Pledged securities(1) ...................................................................... NONE
-------------------
2. Maturity and repricing data for debt securities (1)(2)(3) (excluding those in
nonaccrual status):
--------------------
a. Fixed rate debt securities with a remaining maturity of:
(1) Three months or less .............................................................. 100
-------------------
(2) Over three months through 12 months .............................................. 299
-------------------
(3) Over one year through five years ................................................. 1 486
-------------------
(4) Over five years .................................................................. NONE
-------------------
(5) Total fixed rate debt securities (sum of Memorandum items 2.a.(1)
through 2.a.(4)) .................................................................. 1 885
-------------------
b. Floating rate debt securities with a repricing frequency of:
-------------------
(1) Quarterly or more frequently ..................................................... NONE
-------------------
(2) Annually or more frequently, but less frequently than quarterly ................... NONE
-------------------
(3) Every five years or more frequently, but less frequently than annually ............ NONE
-------------------
(4) Less frequently than every five years ............................................ NONE
-------------------
(5) Total floating rate debt securities (sum of Memorandum items 2.b.(1)
through 2.b.(4) .................................................................. NONE
-------------------
c. Total debt securities (sum of Memorandum items 2.a.(5) and 2.b.(5)) (must equal total
debt securities from Schedule RC-B, sum of items 1 through 5, columns A and D, minus
nonaccrual debt securities included in Schedule RC-N, item 6, column C) ................ 1 885
-------------------
3. Not applicable
-------------------
4. Held-to-maturity debt securities restructured and in compliance with modified terms
(included in Schedule RC-B, items 3 through 5, column A, above) ............................ NONE
-------------------
5. Not applicable
-------------------
6. Floating rate debt securities with a remaining maturity of one year or less(1)(3)
(included in Memorandum items 2.b.(1) through 2.b.(4) above) ............................... NONE
-------------------
7. Amortized cost of held-to-maturity securities sold or transferred to available-for-sale or
trading securities during the calendar year-to-date (report the amortized cost at date of
sale or transfer) .......................................................................... NONE
-------------------
8. High-risk mortgage securities (included in the held-to-maturity and available-for-sale
accounts in Schedule RC-B, item 4.b):
-------------------
a. Amortized cost ......................................................................... NONE
-------------------
b. Fair value ............................................................................. NONE
-------------------
9. Structured notes (included in the held-to-maturity and available-for-sale accounts in
Schedule RC-B, items 2, 3, and 5):
-------------------
a. Amortized cost ......................................................................... NONE
-------------------
b. Fair value ............................................................................. NONE
-------------------
</TABLE>
- ------------
(1) Includes held-to-maturity securities at amortized cost and available-for-
sale securities at fair value.
(2) Exclude equity securities, e.g., investment in mutual funds, Federal
Reserve stock, common stock, and preferred stock.
(3) Memorandum items 2 and 6 are not applicable to savings banks that must
complete supplemental Schedule RC-J.
<PAGE> 16
SCHEDULE RC-C -- LOANS AND LEASE FINANCING RECEIVABLES
Part 1. Loans and Leases
Do not deduct the allowance for loan and lease losses from amounts reported in
this schedule. Report total loans and leases, net of unearned income. Exclude
assets held for trading.
<TABLE>
<Caption)
------------
C115
-----------------
Dollar Amounts in Thousands Mil Thou
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Loans secured by real estate:
a. Construction and land development ..............................................................
b. Secured by farmland (including farm residential and other improvements) ........................
c. Secured by 1-4 family residential properties:
(1) Revolving, open-end loans secured by 1-4 family residential properties and extended
under lines of credit ......................................................................
(2) All other loans secured by 1-4 family residential properties:
(a) Secured by first liens .................................................................
(b) Secured by junior liens ................................................................
d. Secured by multifamily (5 or more) residential properties ......................................
e. Secured by nonfarm nonresidential properties ...................................................
2. Loans to depository institutions ..................................................................
3. Loans to finance agricultural production and other loans to farmers ...............................
4. Commercial and industrial loans ...................................................................
5. Acceptance of other banks .........................................................................
6. Loans to individuals for household, family, and other personal expenditures (i.e., consumer
loans) (includes purchased paper):
a. Credit cards and related plans (includes check credit and other revolving credit plans) ........
b. Other (includes single payment, installment, and all student loans) ............................
7. Obligations (other than securities and leases) of states and political subdivisions in the U.S.
(includes nonrated industrial development obligations) ............................................
8. All other loans (exclude consumer loans) ..........................................................
9. Lease financing receivables (net of unearned income) ..............................................
10. LESS: Any unearned income on loans reflected in items 1-8 above ...................................
11. Total loans and leases, net of unearned income (sum of items 1 through 9 minus item 10)
(must equal Schedule RC, item 4.a) ................................................................ NONE
</TABLE>
<PAGE> 17
The Bank of Nova Scotia Trust Company of New York
- -------------------------------------------------
Legal Title of Bank
New York
- -------------------------------------------------
City
NY 10006
- -------------------------------------------------
State Zip Code
FDIC Certificate Number | | | | | |
-----------
SCHEDULE RC-C -- Continued
Part I. Continued
<TABLE>
<Caption)
Memoranda
-----------------
Dollar Amounts in Thousands Mil Thou
- ----------------------------------------------------------------------------------------------------------------------
<S> <C>
1. Loans(1) and leases restructured and in compliance with modified terms
(included in Schedule RC-C, part I, above and not reported as past due or
nonaccrual in Schedule RC-N, Memorandum item 1):
a. Real estate loans ...........................................................................
b. All other loans and all lease financing receivables (exclude loans to individuals for
household, family, and other personal expenditures) .........................................
2. Maturity and repricing data for loans and leases(2) (excluding those in nonaccrual status):
a. Fixed rate loans and leases with a remaining maturity of:
(1) Three months or less ....................................................................
(2) Over three months through 12 months .....................................................
(3) Over one year through five years ........................................................
(4) Over five years .........................................................................
(5) Total fixed rate loans and leases (sum of Memorandum items 2.a.(1) through 2.a.(4)) .....
b. Floating rate loans with a repricing frequency of:
(1) Quarterly or more frequently ............................................................
(2) Annually or more frequently, but less frequently than quarterly .........................
(3) Every five years or more frequently, but less frequently than annually ..................
(4) Less frequently than every five years ...................................................
(5) Total floating rate loans (sum of Memorandum items 2.b.(1) through 2.b.(4)) .............
c. Total loans and leases (sum of Memorandum items 2.a.(5) and 2.b.(5)) (must equal
the sum of total loans and leases, net, from Schedule RC-C, part I, item 11, plus
unearned income from Schedule RC-C, part I, item 10, minus total nonaccrual loans
and leases from Schedule RC-N, sum of items 1 through 5, column C)...........................
d. Floating rate loans with a remaining maturity of one year or less (included in
Memorandum items 2.b.(1) through 2.b.(4) above) .............................................
3. Reserved
4. Loans to finance commercial real estate, construction, and land development activities
(not secured by real estate) included in Schedule RC-C, part I, items 4 and 8, page RC-5(3) ....
5. Loans and leases held for sale (included in Schedule RC-C, part I, above) ......................
6. Adjustable rate closed-end loans secured by first liens on 1-4 family residential properties
(included in Schedule RC-C, part I, item 1.c.(2)(a), page RC-5) ................................ NONE
</TABLE>
- ---------------
(1) See instructions for loan classifications used in Memorandum item 1.
(2) Memorandum item 2 is not applicable to savings banks that must complete
supplemental Schedule RC-J.
(3) Exclude loans secured by real estate that are included in Schedule RC-C,
part I, items 1.a through 1.e.
<PAGE> 18
Schedule RC-E -- Deposit Liabilities
<TABLE>
<CAPTION>
C125
------------------------------------------------------------
Nontransaction
Transaction Accounts Accounts
------------------------------------------------------------
(Column A) (Column B) (Column C)
Total Memo: Total Total
transaction demand nontransaction
accounts deposits accounts
(including (included in (including
total demand column A) MMDAs)
deposits)
- ------------------------------------------------------------------------------------------------------------------------
Dollar Amounts in Thousands Mil Thou Mil Thou Mil Thou
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Deposits of:
1. Individuals, partnerships, and corporations .......... 888
--------------------------------------------------------
2. U.S. Government ......................................
--------------------------------------------------------
3. States and political subdivisions in the U.S. ........
--------------------------------------------------------
4. Commercial banks in the U.S. (including U.S. branches
and agencies of foreign banks) ....................... 164
--------------------------------------------------------
5. Other depository institutions in the U.S. ............
--------------------------------------------------------
6. Certified and official checks ........................ 1
--------------------------------------------------------
7. Banks in foreign countries, foreign governments, and
foreign official institutions ........................ 1 049
--------------------------------------------------------
8. Total (sum of items 1 through 7) (sum of columns A
and C must equal Schedule RC, item 13.a) ............. 2 102
--------------------------------------------------------
Memoranda
-----------------
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------------
1. Select components of total deposits (i.e., sum of Item 8, columns A and C):
-------------
a. Total Individual Retirement Accounts (IRAs) and Keogh Plan accounts .......................... NONE
-------------
b. Total brokered deposits ...................................................................... NONE
-------------
c. Fully insured brokered deposits (included in Memorandum Item 1.b above):
(1) Issued in denominations of less than $100,000 ........................................... NONE
-------------
(2) Issued either in denominations of $100,000 or in denominations greater than
$100,000 and participated out by the broker in shares of $100,000 or less ............... NONE
-------------
d. Maturity data for brokered deposits:
(1) Brokered deposits issued in denominations of less than $100,000 with a remaining
maturity of one year or less (included in Memorandum Item 1.c.(1) above) ................ NONE
-------------
(2) Brokered deposits issued in denominations of $100,000 or more with a remaining
maturity of one year or less (included in Memorandum Item 1.b. above) ................... NONE
- ------------
e. Preferred deposits (uninsured deposits of states and political subdivisions in the U.S.
reported in item 3 above which are secured or collateralized as required under state law) .... NONE
-------------
2. Components of total nontransaction accounts (sum of Memorandum Items 2.a through 2.d
must equal Item 8, column C, above):
a. Savings deposits:
-------------
(1) Money market deposit accounts (MMDAs) ................................................... NONE
-------------
(2) Other savings deposits (excludes MMDAs) ................................................. NONE
-------------
b. Total time deposits of less than $100,000 .................................................... NONE
-------------
c. Time certificates of deposit of $100,000 or more ............................................. NONE
-------------
d. Open-account time deposits of $100,000 or more ............................................... NONE
-------------
3. All NOW accounts (included in column A above) .................................................... NONE
-------------
4. Not applicable
</TABLE>
<PAGE> 19
The Bank of Nova Scotia Trust Company of New York
- -------------------------------------------------
Legal Title of Bank
FDIC Certificate Number |__|__|__|__|__|
SCHEDULE RC-E -- Continued
Memorandum (Continued)
<TABLE>
<CAPTION>
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
5. Maturity and repricing data for time deposits of less than $100,000 (sum of Memorandum)
items 5.a.(1) through 5.b.(3) must equal Memorandum item 2.b above):(1)
a. Fixed rate time deposits of less than $100,000 with retaining maturity of:
(1) Three months or less ......................................................................
(2) Over three months through 12 months .......................................................
(3) Over one year .............................................................................
b. Floating rate time deposits of less than $100,000 with a repricing frequency of:
(1) Quarterly or more frequently ..............................................................
(2) Annually or more frequently, but less frequently than quarterly ...........................
(3) Less frequently than annually .............................................................
c. Floating rate time deposits of less than $100,000 with a remaining maturity of one year or
less (included in Memorandum items 5.b(1) through 5.b.(3) above) ..............................
6. Maturity and repricing data for time deposits of $100,000 or more (i.e., time certificates
of deposit of $100,000 or more and open-account time deposits of $100,000 or more)
(sum of Memorandum items 6.a.(1) through 6.b.(4) must equal the sum of Memorandum
items 2.c and 2.d above):(1)
a. Fixed rate time deposits of $100,000 or more with a remaining maturity of:
(1) Three months or less ......................................................................
(2) Over three months through 12 months .......................................................
(3) Over one year through five years ..........................................................
(4) Over five years ...........................................................................
b. Floating rate time deposits of $100,000 or more with a repricing frequency of:
(1) Quarterly or more frequently ..............................................................
(2) Annually or more frequently, but less frequently than quarterly ...........................
(3) Every five years or more frequently, but less frequently than annually ....................
(4) Less frequently than every five years .....................................................
c. Floating rate time deposits of $100,000 or more with a remaining maturity of one year or
less (included in Memorandum items 6.b.(1) through 6.b.(4) above) .............................
</TABLE>
- ---------------
(1) Memorandum items 5 and 6 are not applicable to savings banks that must
complete supplemental Schedule RC-J.
<PAGE> 20
SCHEDULE RC-F -- OTHER ASSETS
<TABLE>
<Caption)
------------
C130
-----------------
Dollar Amounts in Thousands Mil Thou
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Income earned, not collected on loans(1) ..........................................................
2. Net deferred tax assets(2) ........................................................................
3. Excess residential mortgage servicing fees receivable ............................................. 75
4. Other (itemize and describe amounts greater than $25,000 that exceed 25% of this item) ............
a. Accrued Interest on Invest ............................................. 32
b. Forwarding Charges Recoverable ......................................... 33
c.
5. Total (sum of items 1 through 4) (must equal Schedule RC, item 11) ................................ 2
</TABLE>
<TABLE>
<Caption)
Memorandum Dollar Amounts in Thousands Mil Thou
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Deferred tax assets disallowed for regulatory capital purposes ....................................
</TABLE>
SCHEDULE RC-G -- OTHER LIABILITIES
<TABLE>
<Caption)
------------
C135
-----------------
Dollar Amounts in Thousands Mil Thou
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. a. Interest accrued and unpaid on deposits(3) .....................................................
b. Other expenses accrued and unpaid (includes accrued income taxes payable) ...................... 8
2. Net deferred tax liabilities(2) ...................................................................
3. Minority interest in consolidated subsidiaries ....................................................
4. Other (itemize and describe amounts greater than $25,000 that exceed 25% of this item) ............ 26
a. Audit Expenses ......................................................... 13
b. Pension Plan ........................................................... 8
c.
5. Total (sum of items 1 through 4) (must equal Schedule RC, item 20) ................................ 34
</TABLE>
- -------------
(1) Report income earned, not collected on securities (and on other assets) in
item 4 of Schedule RC-F.
(2) See discussion of deferred income taxes in Glossary entry on "income taxes."
(3) For savings banks, include "dividends" accrued and unpaid on deposits.
<PAGE> 21
The Bank of Nova Scotia Trust Company of New York
- ---------------------------------------------------------
Legal Title of Bank
FDIC Certificate Number | | | | | |
-----------
SCHEDULE RC-K -- QUARTERLY AVERAGES(1)
<TABLE>
<Caption)
------------
C155
-----------------
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
ASSETS
1. Interest-bearing balances due from depository institutions..........................................
2. a. U.S. Treasury securities, and U.S. Government agency and corporation obligations, and other
debt securities(4) (excluding securities issued by states and political subdivisions 98
in the U.S.). ...................................................................................
b. Equity securities(5) (includes investments in mutual funds and Federal Reserve stock) ...........
3. Securities issued by states and political subdivisions in the U.S.(4) .............................. 1 765
4. Federal funds sold and securities purchased under agreements to resell ............................. 3 233
5. Loans(2,3):
a. Total loans, net of unearned income (to be completed only by those banks with less than
$25 million in total assets) ....................................................................
The following four items are to be completed only by those banks with $25 million or more in
total assets.
b. Real estate loans ...............................................................................
c. Installment loans ...............................................................................
d. Credit cards and related plans ..................................................................
e. Commercial (time and demand) and all other loans ................................................
6. Lease financing receivables (net of unearned income) ...............................................
7. Total assets(6) .................................................................................... 5 375
LIABILITIES
8. Interest-bearing transaction accounts (NOW accounts, ATS accounts, and telephone and
preauthorized transfer accounts) (exclude demand deposits) .........................................
9. Nontransaction accounts:
a. Money market deposit accounts (MMDAs) ...........................................................
b. Other savings deposits ..........................................................................
c. Time certificates of deposit of $100,000 or more ................................................
d. All other time deposits (include all time deposits of less than $100,000 and open-account time
deposits of $100,000 or more) ...................................................................
10. Federal funds purchased and securities sold under agreements to repurchase .........................
</TABLE>
MEMORANDUM
<TABLE>
<Caption)
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
1. To be completed by banks with $25 million or more in total assets and with loans to finance
agricultural production and other loans to farmers (Schedule RC-C, part I, item 3) exceeding
five percent of total loans.(3)
Agricultural loans included in items 5.b through 5.e above .........................................
</TABLE>
- ---------------
(1) For all items, banks have the option of reporting either (1) an average of
daily figures for the quarter, or (2) an average of weekly figures (i.e.,
the Wednesday of each week of the quarter). In addition, averages of four
month-end figures (the last day of the preceding quarter and of each month
of the currently-reported quarter) are allowed for items 2, 3, 5.a through
5.e, 6, 7, and Memorandum item 1.
(2) See instructions for loan classifications used in this schedule.
(3) The $25 million asset size test and the five percent of total loans test are
generally based on the total assets and total loans reported on the June 30,
1995 Report of Condition.
(4) Quarterly averages for all debt securities should be based on amortized
cost.
(5) Quarterly averages for all equity securities should be based on historical
cost.
(6) The quarterly average for total assets should reflect all debt securities
(not held for trading) at amortized cost, equity securities and readily
determinable fair values at the lower of cost or fair value, and equity
securities without readily determinable fair values at historical cost.
<PAGE> 22
Schedule RC-L -- Off-Balance Sheet Items
Please read carefully the instructions for the preparation of Schedule RC-L.
Some of the amounts reported in Schedule RC-L are regarded as volume indicators
and not necessarily as measures of risk.
<TABLE>
<CAPTION>
C160
-----------------
Dollar Amounts in Thousands Mil Thou
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Unused commitments:
a. Revolving, open-end lines secured by 1-4 family residential properties, e.g., home equity lines ....
b. Credit card lines ..................................................................................
c. Commercial real estate, construction, and land development:
(1) Commitments to fund loans secured by real estate ...............................................
(2) Commitments to fund loans not secured by real estate ...........................................
d. Securities underwriting ............................................................................
e. Other unused commitments ...........................................................................
2. Financial standby letters of credit(1) ................................................................
a. Amount of financial standby letters of credit conveyed to others ................
3. Performance standby letters of credit(1) ..............................................................
a. Amount of performance standby letters of credit conveyed to others ..............
4. Commercial and similar letters of credit(1) ...........................................................
5. Not applicable
6. Participations in acceptances (as described in the instructions) acquired by the reporting
(nonaccepting) bank ...................................................................................
7. Securities borrowed ...................................................................................
8. Securities lent (including customers' securities lent where the customer is indemnified against
loss by the reporting bank) ...........................................................................
9. Loans transferred (i.e., sold or swapped) with recourse that have been treated as sold for
Call Report purposes:
a. FNMA and FHLMC residential mortgage loan pools:
(1) Outstanding principal balance of mortgages transferred as of the report date ...................
(2) Amount of recourse exposure on these mortgages as of the report date ...........................
b. Private (nongovernment-issued or -guaranteed) residential mortgage loan pools:
(1) Outstanding principal balance of mortgages transferred as of the report date ...................
(2) Amount of recourse exposure on these mortgages as of the report date ...........................
c. Farmer Mac agricultural mortgage loan pools:
(1) Outstanding principal balance of mortgages transferred as of the report date ...................
(2) Amount of recourse exposure on these mortgages as of the report date ...........................
d. Small business obligations transferred with recourse under Section 208 of the Riegle
Community Development and Regulatory Improvement Act of 1994:
(1) Outstanding principal balance of small business obligations transferred as of the report date ..
(2) Amount of retained recourse on these obligations as of the report date .........................
10. When-issued securities:
a. Gross commitments to purchase ......................................................................
b. Gross commitments to sell ..........................................................................
11. Spot foreign exchange contracts .......................................................................
12. All other off-balance sheet liabilities (exclude off-balance sheet derivatives) (itemize and
describe each component of this item over 25% of Schedule RC, item 28.a, "Total equity capital") ......
a.
----------------------------------------------------------------------------------------------------
b.
----------------------------------------------------------------------------------------------------
c.
----------------------------------------------------------------------------------------------------
d.
----------------------------------------------------------------------------------------------------
</TABLE>
- ------------
(1) Do not report letters of credit as "contra" items in "Other assets"
(Schedule RC-F) and "Other liabilities" (Schedule RC-G).
<PAGE> 23
The Bank of Nova Scotia Trust Company of New York
- -------------------------------------------------
Legal Title of Bank
FDIC Certificate Number |__|__|__|__|__|
SCHEDULE RC-L -- Continued
<TABLE>
<CAPTION>
Dollar Amounts in Thousands Mill Thou
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
13. All other off-balance sheet assets (exclude off-balance sheet derivatives) (itemize and describe
each component of this item over 25% of Schedule RC, item 28.a, "Total equity capital") .........
a.
b.
c.
d.
</TABLE>
<TABLE>
<CAPTION>
C161
-----------------------------------------------------------------------------
(Column A) (Column B) (Column C) (Column D)
Dollar Amounts in Thousands Interest Rate Foreign Exchange Equity Derivative Commodity and
- ------------------------------------------------ Contracts Contracts Contracts Other Contracts
Off-balance Sheet Derivatives ---------------- ---------------- ------------------ -----------------
Position Indicators Mil Thou Mil Thou Mil Thou Mil Thou
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
14. Gross amounts (e.g., notional amounts) (for
each column, sum of items 14.a through 14.e
must equal sum of items 15, 16.a, and 16.b):
a. Futures contracts .......................
b. Forward contracts .......................
c. Exchange-traded option contracts:
(1) Written options .....................
(2) Purchased options ...................
d. Over-the-counter option contracts:
(1) Written options .....................
(2) Purchased options ...................
e. Swaps ...................................
15. Total gross notional amount of derivative
contracts held for trading .................
16. Total gross notional amount of derivative
contracts held for purposes other than
trading ....................................
a. Contracts marked to market ..............
b. Contracts not marked to market ..........
</TABLE>
<TABLE>
<CAPTION>
Memorandum
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. - 2. Not applicable
3. Unused commitments with an original maturity exceeding one year that are reported in
Schedule RC-L, items 1.a through 1.e, above (report only the unused portions of
commitments that are fee paid or otherwise legally binding) ......................................
</TABLE>
<PAGE> 24
SCHEDULE RC-M -- MEMORANDA
<TABLE>
<Caption)
------------
C165
-----------------
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C>
1. Extensions of credit by the reporting bank to its executive officers, directors, principal
shareholders, and their related interests as of the report date:
a. Aggregate amount of all extensions of credit to all executive officers, directors, principal
shareholders, and their related interests ........................................................... NONE
b. Number of executive officers, directors, and principal shareholders to whom the Number
amount of all extensions of credit by the reporting bank (including extensions of ------------------
credit to related interests) equals or exceeds the lesser of $500,000 or 5 percent
of total capital as defined for this purpose in agency regulations .................
2. Not applicable ------------------
3. a. Noninterest-bearing balances due from commercial banks in the U.S. (included in Schedule RC,
item 1.a) (exclude balances due from Federal Reserve Banks and cash items in process of
collection) .......................................................................................... NONE
b. Currency and coin (included in Schedule RC, item 1.a) ................................................ NONE
4. Outstanding principal balance of 1-4 family residential mortgage loans serviced for others
(include both retained servicing and purchased servicing):
a. Mortgages serviced under a GNMA contract ............................................................. NONE
b. Mortgages serviced under a FHLMC contract:
(1) Serviced with recourse to servicer ............................................................... NONE
(2) Serviced without recourse to servicer ............................................................ NONE
c. Mortgages serviced under a FNMA contract:
(1) Serviced under a regular option contract ......................................................... NONE
(2) Serviced under a special option contract ......................................................... NONE
d. Mortgages serviced under other servicing contracts ................................................... NONE
5. Not applicable
6. Intangible assets:
a. Mortgage servicing rights ............................................................................ NONE
b. Other identifiable intangible assets:
(1) Purchased credit card relationships .............................................................. NONE
(2) All other identifiable intangible assets ......................................................... NONE
c. Goodwill ............................................................................................. NONE
d. Total (sum of items 6.a through 6.c) (must equal Schedule RC, item 10) ............................... NONE
e. Amount of intangible assets (included in item 6.b(2) above) that have been grandfathered
or are otherwise qualifying for regulatory capital purposes) ......................................... NONE
7. Mandatory convertible debt, net of common or perpetual preferred stock dedicated to
redeem .................................................................................................. NONE
8. a. Other real estate owned:
(1) Direct and indirect investments in real estate ventures .......................................... NONE
(2) All other real estate owned:
(a) Construction and land development ............................................................ NONE
(b) Farmland ..................................................................................... NONE
(c) 1-4 family residential properties ............................................................ NONE
(d) Multifamily (5 or more) residential properties ............................................... NONE
(e) Nonfarm nonresidential properties ............................................................ NONE
(3) Total (sum of items 8.a.(1) and 8.a.(2)) (must equal Schedule RC, item 7) ........................ NONE
b. Investments in unconsolidated subsidiaries and associated companies:
(1) Direct and indirect investments in real estate ventures .......................................... NONE
(2) All other investments in unconsolidated subsidiaries and associated companies .................... NONE
(3) Total (sum of items 8.b(1) and 8.b(2), (must equal Schedule RC, item 8) .......................... NONE
c. Total assets of unconsolidated subsidiaries and associated companies ................................. NONE
</TABLE>
<PAGE> 25
The Bank of Nova Scotia Trust Company of New York
- -------------------------------------------------
Legal Title of Bank
FDIC Certificate Number | | | | | |
----------------
SCHEDULE RC-M -- CONTINUED
<TABLE>
<Caption)
----------------
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
9. Noncumulative perpetual preferred stock and related surplus included in Schedule RC,
item 23, "Perpetual preferred stock and related surplus"....................................... NONE
----------------
10. Mutual fund and annuity sales during the quarter (include proprietary, private label, and
third party products):
----------------
a. Money market funds ........................................................................ NONE
----------------
b. Equity securities funds ................................................................... NONE
----------------
c. Debt securities funds ..................................................................... NONE
----------------
d. Other mutual funds ........................................................................ NONE
----------------
e. Annuities ................................................................................. NONE
----------------
f. Sales of proprietary mutual funds and annuities (included in items 10.a through
10.e above) ............................................................................... NONE
----------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------
----------------
Memorandum Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Interbank holdings of capital instruments (to be completed for the December report only):
----------------
a. Reciprocal holdings of banking organizations' capital instruments ......................... NONE
----------------
b. Nonreciprocal holdings of banking organizations' capital instruments ...................... NOME
----------------
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 26
Schedule RC-N -- Past Due and Nonaccrual Loans,(1) Leases, and Other Assets
The FFIEC regards the information reported in all of Memorandum item 1, in
items 1 through 7, column A, and in Memorandum items 2 through 4, column A,
as confidential.
<TABLE>
<CAPTION>
C170
------------------------------------------------------------
(Column A) (Column B) (Column C)
Past Due Past Due 90 Nonaccrual
30 through 89 days or more
days and still and still
accruing accruing
- ------------------------------------------------------------------------------------------------------------------------
Dollar Amounts in Thousands Mil Thou Mil Thou Mil Thou
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Real estate loans ....................................
--------------------------------------------------------
2. Installment loans ....................................
--------------------------------------------------------
3. Credit cards and related plans .......................
--------------------------------------------------------
4. Commercial (time and demand) and all other loans .....
--------------------------------------------------------
5. Lease financing receivables ..........................
--------------------------------------------------------
6. Debt securities and other assets (excludes other real
estate owned and other repossessed assets) ........... NONE NONE NONE
--------------------------------------------------------
=============================================================================================================================
</TABLE>
Amounts reported in items 1 through 5 above include guaranteed and unguaranteed
portions of past due and nonaccrual loans and leases. Report in item 7 below
certain guaranteed loans and leases that have already been included in the
amounts reported in items 1 through 5.
<TABLE>
<CAPTION>
-----------------------------------------------------------
Mil Thou Mil Thou Mil Thou
-----------------------------------------------------------
<S> <C> <C>
7. Loans and leases reported in items 1 through 5 above
which are wholly or partially guaranteed by the
U.S. Government ......................................
------------------------------------------------------------
a. Guaranteed portion of loans and leases included
in item 7 above ..................................
------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Memoranda C173
------------------------------------------------------------
Dollar Amounts in Thousands Mil Thou Mil Thou Mil Thou
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Restructured loans and leases included in Schedule
RC-N, items 1 through 5, above (and not reported in
Schedule RC-C, Part I, Memorandum item 1) ............
------------------------------------------------------------
2. To be completed by banks with loans to finance
agricultural production and other loans to farmers
(Schedule RC-C, part I, item 3) exceeding five percent
of total loans:
Agricultural loans included in Schedule RC-N,
items 1 through 4, above .............................
------------------------------------------------------------
3. Loans to finance commercial real estate, construction,
and land development activities (not secured by real
estate) included in Schedule RC-N, items 2 through 4,
above ................................................
------------------------------------------------------------
4. Real estate loans (sum of Memorandum items 4.a
through 4.e must equal Schedule RC-N, item 1, above):
a. Construction and land development ................
------------------------------------------------------------
b. Secured by farmland ..............................
------------------------------------------------------------
c. Secured by 1-4 family residential properties:
(1) Revolving, open-end loans secured by 1-4
family residential properties and extended
under lines of credit .......................
------------------------------------------------------------
(2) All other loans secured by 1-4 family
residential properties ......................
------------------------------------------------------------
d. Secured by multifamily (5 or more) residential
properties .......................................
------------------------------------------------------------
e. Secured by nonfarm nonresidential properties .....
------------------------------------------------------------
</TABLE>
- ------------
(1) See instructions for loan classifications used in this schedule.
<PAGE> 27
The Bank of Nova Scotia Trust Company of New York
------------------------------------------------------------------
Legal Title of Bank
FDIC Certificate Number [___________]
SCHEDULE RC-O -- OTHER DATA FOR DEPOSIT INSURANCE ASSESSMENTS
<TABLE>
<CAPTION>
------------
C175
------------
Dollar Amounts in Thousands Mil Thou
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Unposted debits (see instructions):
a. Actual amount of all unposted debits ...............................................................
-----------
OR
b. Separate amount of unposted debits:
(1) Actual amount of unposted debits to demand deposits ............................................
-----------
(2) Actual amount of unposted debits to time and savings deposits(1) ...............................
-----------
2. Unposted credits (see instructions):
a. Actual amount of all unposted credits ..............................................................
OR -----------
b. Separate amount of unposted credits:
(1) Actual amount of unposted credits to demand deposits .........................................
-----------
(2) Actual amount of unposted credits to time and savings deposits(1) .............................
-----------
3. Uninvested trust funds (cash) held in bank's own trust department (not included in total deposits) ...
-----------
4. Deposits of consolidated subsidiaries (not included in total deposits):
a. Demand deposits of consolidated subsidiaries .......................................................
-----------
b. Time and savings deposits(1) of consolidated subsidiaries ..........................................
-----------
c. Interest accrued and unpaid on deposits of consolidated subsidiaries ...............................
-----------
5. Not applicable.
Item 6 is not applicable to state nonmember banks that have not been authorized by the
Federal Reserve to act as pass-through correspondents.
6. Reserve balances actually passed through to the Federal Reserve by the reporting bank on
behalf of its respondent depository institutions that are also reflected as deposit liabilities
of the reporting bank:
a. Amount reflected in demand deposits (included in Schedule RC-E, Item 4 or 5, column B) .............
-----------
b. Amount reflected in time and savings deposits(1) (included in Schedule RC-E,
item 4 or 5, column A or C, but not column B) ......................................................
-----------
7. Unamortized premiums and discounts on time and savings deposits:(1)
a. Unamortized premiums ...............................................................................
-----------
b. Unamortized discounts ..............................................................................
-----------
- --------------------------------------------------------------------------------------------------------------------------
8. To be completed by banks with "Oakar deposits."
Total "Adjusted Attributable Deposits" of all institutions acquired under Section 5(d)(3) of the
Federal Deposit Insurance Act (from most recent FDIC Oakar Transaction Worksheet(s)) ..................
-----------
- --------------------------------------------------------------------------------------------------------------------------
9. Deposits in lifeline accounts .........................................................................
-----------
10. Benefit-responsive "Depository Institution Investment Contracts" (included in total deposits) ........
-----------
</TABLE>
- -------------
(1) For FDIC insurance assessment purposes, "time and savings deposits" consists
of nontransaction accounts and all transaction accounts other than demand
deposits.
<PAGE> 28
The Bank of Nova Scotia Trust Company of New York
- ------------------------------------------------------
Legal Title of Bank
FDIC Certificate Number ___________________
Schedule RC-O -- Continued
<TABLE>
<CAPTION>
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
11. Adjustments to demand deposits reported in Schedule RC-E for certain reciprocal demand
balances:
-------------
a. Amount by which demand deposits would be reduced if reciprocal demand balances between
the reporting bank and savings associations were reported on a net basis rather than a
gross basis in Schedule RC-E ..............................................................
-------------
b. Amount by which demand deposits would be increased if reciprocal demand balances
between the reporting bank and U.S. branches and agencies of foreign banks were
reported on a gross basis rather than a net basis in Schedule RC-E ........................
-------------
c. Amount by which demand deposits would be reduced if cash items in process of collection
were included in the calculation of net reciprocal demand balances between the reporting
bank and the domestic offices of U.S. banks and savings associations in Schedule RC-E .....
-------------
Memoranda (to be completed each quarter except as noted)
<CAPTION>
Dollar Amounts in Thousands Mil Thou
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Total deposits of the bank (sum of Memorandum items 1.a.(1) and 1.b.(1) must
equal Schedule RC, item 13.a):
a. Deposit accounts of $100,000 or less:
-----------
(1) Amount of deposit accounts of $100,000 or less ........................................ 128
-----------
Number
-------------
(2) Number of deposit accounts of $100,000 or less (to be
contemplated for the June report only) ..................................
-------------
b. Deposit accounts of more than $100,000:
-----------
(1) Amount of deposit accounts of more than $100,000 ....................................... 1 974
Number
-------------
(2) Number of deposit accounts of more than $100,000 ........................ 3
-------------
2. Estimated amount of uninsured deposits of the bank:
a. An estimate of your bank's uninsured deposits can be determined by multiplying the
number of deposit accounts of more than $100,000 reported in Memorandum item 1.b.(2)
above by $100,000 and subtracting the result from the amount of deposit accounts of
more than $100,000 reported in Memorandum item 1.b.(1) above.
YES NO
-----------
Indicate in the appropriate box at the right whether your bank has a method or procedure
for determining a better estimate of uninsured deposits than the estimate described above ...
-----------
Mil Thou
-----------
b. If the box marked YES has been checked, report the estimate of uninsured deposits
determined by using your bank's method or procedure ..........................................
-----------
</TABLE>
- ------------------------------------------------------------------------------
C177
-------
Person to whom questions about the Reports of Condition and Income
should be directed:
George E. Timmes, Secretary (212) 225-5422
- ----------------------------- --------------------------------------------
Name and Title Area code/phone number/extension
<PAGE> 29
The Bank of Nova Scotia Trust Company of New York
- ---------------------------------------------------
Legal Title of Bank
FDIC Certificate Number ________________
Schedule RC-R - Regulatory Capital
This schedule must be completed by all banks as follows: Banks that reported
total assets of $1 billion or more in Schedule RC, item 12, for June 30, 1995,
must complete items 2 through 9 and Memoranda items 1 and 2. Banks with assets
of less than $1 billion must complete items 1 through 3 below or Schedule RC-R
in its entirety, depending on their response to Item 1 below:
1. Test for determining the extent to which Schedule RC-R must be
completed. To be completed only by banks with total assets of C180
less than $1 billion. Indicate in the appropriate box at the ---------
right whether the bank has total capital greater than or YES NO
equal to eight percent of adjusted total assets............... ----------
X
-----------
For purposes of this test, adjusted total assets equals total assets
less cash, U.S. Treasuries, U.S. Government agency obligations, and 80
percent of U.S. Government-sponsored agency obligations plus the allowance
for loan and lease losses and selected off-balance sheet items as reported
on Schedule RC-L (see Instructions).
If the box marked YES has been checked, then the bank only has to
complete items 2 and 3 below. If the box marked NO has been checked, the bank
must complete the remainder of this schedule.
A NO response to item 1 does not necessarily mean that the bank's
actual risk-based capital ratio is less than eight percent or that the bank
is not in compliance with the risk-based capital guidelines.
- -------------------------------------------------------------
NOTE: All banks are required to complete items 2 and 3 below.
See optional worksheet for items 3.a through 3.f.
- -------------------------------------------------------------
<TABLE>
<CAPTION>
----------------------------------
(Column A) (Column B)
Subordinated Other
Debt(1) and Inter- Limited-Life
Dollar Amounts in Thousands mediate Term Capital
- ------------------------------------------------------------------------------------- Preferred Stock Instruments
---------------------------------
Mil Thou Mil Thou
---------------------------------
<S> <C> <C> <C> <C>
2. Subordinated debt(1) and other limited-life capital instruments
(original weighted average maturity of at least five years) with
a remaining maturity of:
a. One year or less ............................................................. NONE NONE
------------------------------
b. Over one year through two years .............................................. NONE NONE
------------------------------
c. Over two years through three years ........................................... NONE NONE
------------------------------
d. Over three years through four years .......................................... NONE NONE
------------------------------
e. Over four years through five years ........................................... NONE NONE
------------------------------
f. Over five years .............................................................. NONE NONE
------------------------------
3. Amounts used in calculating regulatory capital ratios (report amounts
determined by the bank for its own internal regulatory capital analyses
consistent with applicable capital standards):
<CAPTION>
Mil Thou
-----------
<S> <C> <C> <C>
a. Tier 1 capital .................................................................................. 2 281
-----------
b. Tier 2 capital ..................................................................................
-----------
c. Total risk-based capital ........................................................................ 2 281
-----------
d. Excess allowance for loan and lease losses ......................................................
-----------
e. Risk-weighted assets (net of all deductions, including excess allowance) ........................
-----------
f. "Average total assets" (net of all assets deducted from Tier 1 capital)(2) ...................... 5 375
-----------
Items 4-9 and Memoranda items 1 and 2 are to be completed
by banks that answered NO to item 1 above and by banks
with total assets of $1 billion or more.
<CAPTION>
-------------------------------------
(Column A) (Column B)
Assets Credit Equivalent
Recorded Amount of
on the Off-Balance
Balance Sheet Sheet Items(3)
-------------------------------------
Mil Thou Mil Thou
-------------------------------------
<S> <C> <C> <C> <C> <C>
4. Assets and credit equivalent amounts of off-balance sheet items
assigned to the Zero percent risk category:
a. Assets recorded on the balance sheet:
(1) Securities issued by, other claims on, and claims unconditionally
guaranteed by, the U.S. Government and its agencies and other
OECD central governments ............................................
-----------------
(2) All other ...........................................................
------------------------------------
b. Credit equivalent amount of off-balance sheet items ......................
-------------------------------------
</TABLE>
- ------------
(1) Exclude mandatory convertible debt reported in Schedule RC-M, item 7.
(2) Do not deduct excess allowance for loan and lease losses.
(3) Do not report in column B the risk-weighted amount of assets reported in
column A.
<PAGE> 30
Schedule RC-R -- Continued
<TABLE>
<CAPTION>
(Column A) (Column B)
Assets Credit Equiv-
Recorded alent Amount
on the of Off-Balance
Balance Sheet Sheet Items(1)
--------------- ---------------
Dollar Amounts in Thousands Mil Thou Mil Thou
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
5. Assets and credit equivalent amounts of off-balance sheet items assigned
to the 20 percent risk category:
a. Assets recorded on the balance sheet:
(1) Claims conditionally guaranteed by the U.S. Government and its agencies
and other OECD central governments ..........................................
(2) Claims collateralized by securities issued by the U.S. Government and its
agencies and other OECD central governments; by securities issued by
U.S. Government-sponsored agencies; and by cash on deposit ..................
(3) All other ...................................................................
b. Credit equivalent amount of off-balance sheet items .............................
6. Assets and credit equivalent amounts of off-balance sheet items assigned to the
50 percent risk category:
a. Assets recorded on the balance sheet ............................................
b. Credit equivalent amount of off-balance sheet items .............................
7. Assets and credit equivalent amounts of off-balance sheet items assigned to the
100 percent risk category:
a. Assets recorded on the balance sheet ............................................
b. Credit equivalent amount of off-balance sheet items .............................
8. On-balance sheet asset values excluded from the calculation of the risk-based
capital ratio(2) ...................................................................
9. Total assets recorded on the balance sheet (sum of items 4.a, 5.a, 6.a, 7.a,
and 8, column A) (must equal Schedule RC, item 12.c plus items 4.b and 4.c) ........
</TABLE>
<TABLE>
<CAPTION>
Memoranda
Dollar Amounts in Thousands Mil Thou
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Current credit exposure across all off-balance sheet derivative contracts covered by the
risk-based capital standards .........................................................................
</TABLE>
<TABLE>
<CAPTION>
With a remaining maturity of
-------------------------------------------------
(Column B)
Over
(Column A) one year (Column C)
One year through Over
or less five years five years
--------------- --------------- --------------
Dollar Amounts in Thousands Mil Thou Mil Thou Mil Thou
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
2. Notional principal amounts of off-balance
sheet derivative contracts:(3)
a. Interest rate contracts .......................................
b. Foreign exchange contracts ....................................
c. Gold contracts ................................................
d. Other precious metals contracts ...............................
e. Other commodity contracts .....................................
f. Equity derivative contracts ...................................
</TABLE>
- ------------
(1) Do not report in column B the risk-weighted amount of assets reported in
Column A.
(2) Include the difference between the fair value and the amortized cost of
available-for-sale securities in item 8 and report the amortized cost of
these securities in items 4 through 7 above. Item 8 also includes on-balance
sheet asset values (or portions thereof) of off-balance sheet interest rate,
foreign exchange rate, and commodity contracts and those contracts (e.g.,
futures contracts) not subject to risk-based capital. Exclude from item 8
margin accounts and accrued receivables not included in the calculation of
credit equivalent amounts of off-balance sheet derivatives as well as any
portion of the allowance for loan and lease losses in excess of the amount
that may be included in Tier 2 capital.
(3) Exclude foreign exchange contracts with an original maturity of 14 days or
less and all futures contracts.
<PAGE> 31
OPTIONAL NARRATIVE STATEMENT CONCERNING THE AMOUNTS
REPORTED IN THE REPORTS OF CONDITION AND INCOME
at close of business on March 31, 1997
The Bank of Nova Scotia Trust Company of New York New York NY
- ------------------------------------------------- ---------- -----
Legal Title of Bank City State
The management of the reporting bank may, if it wishes, submit a brief
narrative statement on the amounts reported in the Reports of Condition and
Income. This optional statement will be made available to the public, along
with the publicly available data in the Reports of Condition and Income, in
response to any request for individual bank report data. However, the
information reported in column A and in all of Memorandum Item 1 of Schedule
RC-N is regarded as confidential and will not be released to the public. BANKS
CHOOSING TO SUBMIT THE NARRATIVE STATEMENT SHOULD ENSURE THAT THE STATEMENT
DOES NOT CONTAIN THE NAMES OR OTHER IDENTIFICATIONS OF INDIVIDUAL BANK
CUSTOMERS, REFERENCES TO THE AMOUNTS REPORTED IN THE CONFIDENTIAL ITEMS IN
SCHEDULE RC-N, OR ANY OTHER INFORMATION THAT THEY ARE NOT WILLING TO HAVE MADE
PUBLIC OR THAT WOULD COMPROMISE THE PRIVACY OF THEIR CUSTOMERS. Banks choosing
not to make a statement may check the "No comment" box below and should make no
entries of any kind in the space provided for the narrative statement; i.e., DO
NOT enter in this space such phrases as "No statement," "Not applicable,"
"N/A," "No comment," and "None."
The optional statement must be entered on this sheet. The statement should not
exceed 100 words. Further, regardless of the number of words, the statement
must not exceed 750 characters, including punctuation, indentation, and standard
spacing between words and sentences. If any submission should exceed 750
characters, as defined, it will be truncated at 750 characters with no notice
to the submitting bank and the truncated statement will appear as the bank's
statement both on agency computerized records and in computerized releases to
the public.
All information furnished by the bank in the narrative statement must be
accurate and not misleading. Appropriate efforts shall be taken by the
submitting bank to ensure the statement's accuracy. The statement must be
signed, in the space provided below, by a senior officer of the bank thereby
attests to its accuracy.
If, subsequent to the original submission, material changes are submitted for
the data reported in the Reports of Condition and Income, the existing narrative
statement will be deleted from the files, and from disclosure; the bank, at its
option may replace it with a statement, under signature, appropriate to the
amended data.
The optional narrative statement will appear in agency records and in release
to the public exactly as submitted (or amended as described in the preceding
paragraph) by the management of the bank (except for the truncation of
statements exceeding the 750-character limit described above). THE STATEMENT
WILL NOT BE EDITED OR SCREENED IN ANY WAY BY THE SUPERVISORY AGENCIES FOR
ACCURACY OR RELEVANCE. DISCLOSURE OF THE STATEMENT SHALL NOT SIGNIFY THAT ANY
FEDERAL SUPERVISORY AGENCY HAS VERIFIED OR CONFIRMED THE ACCURACY OF THE
INFORMATION CONTAINED THEREIN. A STATEMENT TO THIS EFFECT WILL APPEAR ON ANY
PUBLIC RELEASE OF THE OPTIONAL STATEMENT SUBMITTED BY THE MANAGEMENT OF THE
REPORTING BANK.
- -------------------------------------------------------------------------------
No comment /X/ C171 C172
BANK MANAGEMENT STATEMENT (please type or print clearly):
-------------------------------------- -----------------
Signature of Executive Officer of Bank Date of Signature
<PAGE> 32
THIS PAGE IS TO BE COMPLETED BY ALL BANKS
- -------------------------------------------------------------------------------
NAME AND ADDRESS OF BANK OMB No. For OCC: 1557-0081
OMB No. For FDIC 3064-0052
OMB No. for Federal Reserve: 7100-0036
Expiration Date: 3/31/99
PLACE LABEL HERE
SPECIAL REPORT
The Bank of Nova Scotia Trust Company (Dollar Amounts in Thousands)
of New York
One Liberty Plaza ------------------------------------------
New York, NY 10006 CLOSE OF FDIC CERTIFICATE
BUSINESS DATE NUMBER C-700
- --------------------------------------------------------------------------------
LOANS TO EXECUTIVE OFFICERS (Complete as of each Call Report Date)
- --------------------------------------------------------------------------------
The following information is required by Public Laws 90-44 and 102-242, but
does not constitute a part of the Report of Condition. With each Report of
Condition, these Laws require all banks to furnish a report of all loans or
other extensions of credit to their executive officers made the date of the
previous Report of Condition. Data regarding individual loans or other
extensions of credit are not required. If no such loans or extensions of credit
were made during the period, insert "none" against subitem (a). (Exclude the
first $15,000 of indebtedness of each executive officer under bank credit card
plan.) See Sections 215.2 and 215.3 of Title 12 of the Code of Federal
Regulations (Federal Reserve Board Regulation O) for the definitions of
"executive officer" and "extension of credit," respectively. Exclude loans and
other extensions of credit to directors and principal shareholders who are not
executive officers.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
----------------------------
<S> <C> <C>
a. Number of loans made to executive officers since the previous Call Report date ............ NONE
---------------------
b. Total dollar amount of above loans (in thousands of dollars) .............................. 0
---------------------
----------------------------------------------------------
c. Range of interest charged on above loans
(example: 9 3/4% + 9.75) ................................................. ___ . ___ % to ___ . ___ %
----------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
<S> <C>
SIGNATURE AND TITLE OF OFFICER AUTHORIZED TO SIGN REPORT DATE (Month, Day, Year)
[SIG] May 6, 1997
- ---------------------------------------------------------------------------------------------------
NAME AND TITLE OF PERSON TO WHOM INQUIRIES MAY BE DIRECTED AREA CODE/PHONE NUMBER/EXTENSION
G. E. Timmes, Secretary (212) 225-5422
- ---------------------------------------------------------------------------------------------------
</TABLE>
