<PAGE> 1
Filed Pursuant to Rule 424(b)(2)
Registration Nos. 33-49991 and 33-60351
PROSPECTUS SUPPLEMENT
(To Prospectus dated October 3, 1995)
$300,000,000
BELLSOUTH TELECOMMUNICATIONS, INC.
THIRTY YEAR 7% DEBENTURES, DUE OCTOBER 1, 2025
------------------------
Interest payable April 1 and October 1
------------------------
The Debentures will not be redeemable prior to maturity. The Debentures will be
represented by one or more global securities registered in the name of a
nominee of The Depository Trust Company, as depositary. Beneficial interests
in the Debentures will be shown on, and transfers thereof will be effected
only through, records maintained by The Depository Trust Company and its
participants. Except as described herein, Debentures in definitive form
will not be issued. The Debentures will trade in The Depository Trust
Company's Same-Day Funds Settlement System. All payments of
principal and interest on global securities will be made by the
Company in immediately available funds. See "Description of the
Debentures -- Book-Entry System."
------------------------
Application will be made to list the Debentures on the New York Stock Exchange.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------------
PRICE 99.273% AND ACCRUED INTEREST
------------------------
<TABLE>
<CAPTION>
UNDERWRITING
DISCOUNTS PROCEEDS TO
PRICE TO PUBLIC(1) AND COMMISSIONS(2) COMPANY(1)(3)
------------------- ------------------ -----------------
<S> <C> <C> <C>
Per Debenture...................... 99.273% .875% 98.398%
Total.............................. $297,819,000 $2,625,000 $295,194,000
</TABLE>
- ------------
(1) Plus accrued interest from October 1, 1995.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
(3) Before deduction of expenses payable by the Company estimated at $300,000.
------------------------
The Debentures are offered by the Underwriters named below, subject to
prior sale, when, as and if accepted by the Underwriters and subject to approval
of certain legal matters by Davis Polk & Wardwell, counsel for the Underwriters.
It is expected that delivery of the Debentures will be made on or about October
6, 1995 through the book-entry facilities of The Depository Trust Company
against payment therefor in immediately available funds.
------------------------
MORGAN STANLEY & CO.
Incorporated
GOLDMAN, SACHS & CO.
LEHMAN BROTHERS
MERRILL LYNCH & CO.
SALOMON BROTHERS INC
October 3, 1995
<PAGE> 2
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICES OF THE DEBENTURES
OFFERED HEREBY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
PROCEEDS OF THE OFFERING
The proceeds from the sale of the Debentures offered hereby (the
"Debentures") are expected to be as follows:
<TABLE>
<S> <C>
Gross Proceeds........................................... $ 297,819,000
Accrued Interest......................................... 291,667
Less--Underwriting Discounts and Commissions............. 2,625,000
Expenses.......................................... 300,000
---------------
Net Proceeds...................................... $ 295,185,667
==============
</TABLE>
The Company intends to apply the net proceeds toward the permanent
refinancing of $300,000,000 aggregate principal amount of thirty-eight year
8 3/4% Debentures due November 1, 2024, issued by Southern Bell Telephone and
Telegraph Company.
DESCRIPTION OF THE DEBENTURES
GENERAL
The Debentures will be issued under an Indenture dated October 1, 1995 and
a supplemental indenture thereto dated October 1, 1995. Provisions of the
Indenture are more fully described under "Description of Securities" in the
attached Prospectus to which reference is hereby made.
The Debentures will mature on October 1, 2025. Interest on the Debentures
will accrue from October 1, 1995 and will be payable semiannually on each April
1 and October 1, beginning April 1, 1996, to the persons in whose names the
Debentures are registered at the close of business on the March 15 or September
15 prior to the payment date at the annual rate set forth on the cover page of
this Prospectus Supplement.
The Debentures are not redeemable prior to maturity.
The principal of, and interest on, the Debentures are to be payable at the
office or agency of the Company in New York, New York.
DEFEASANCE
The Debentures will be subject to defeasance and covenant defeasance as
provided in the attached Prospectus.
S-2
<PAGE> 3
TRUSTEE
Compass Bank (the "Trustee") is the Trustee under the Indenture. The
Company and certain of its affiliates maintain banking relationships in the
ordinary course of business with the Trustee. The Trustee is also the trustee
with respect to the Company's Ten Year 6 1/4% Notes, due May 15, 2003.
BOOK-ENTRY SYSTEM
The Debentures will be represented by one or more global securities (the
"Global Security"). The Global Security will be deposited with, or on behalf of,
The Depository Trust Company (the "Depositary") and registered in the name of a
nominee of the Depositary. Except under circumstances described below, the
Debentures will not be issuable in definitive form.
Upon the issuance of the Global Security, the Depositary will credit on its
book-entry registration and transfer system the accounts of persons designated
by the Underwriters with the respective principal amounts of the Debentures
represented by the Global Security. Ownership of beneficial interests in the
Global Security will be limited to persons that have accounts with the
Depositary or its nominee ("participants") or persons that may hold interests
through participants. Ownership of beneficial interests in the Global Security
will be shown on, and the transfer of that ownership will be effected only
through, records maintained by the Depositary or its nominee (with respect to
interests of participants) and on the records of participants (with respect to
interests of persons other than participants). The laws of some states require
that certain purchasers of securities take physical delivery of such securities
in definitive form. Such limits and such laws may impair the ability to transfer
beneficial interests in the Global Security.
So long as the Depositary or its nominee is the registered owner of the
Global Security, the Depositary or such nominee, as the case may be, will be
considered the sole owner or holder of the Debentures represented by the Global
Security for all purposes under the Indenture. Except as provided below, owners
of beneficial interests in the Global Security will not be entitled to have
Debentures represented by the Global Security registered in their names, will
not receive or be entitled to receive physical delivery of Debentures in
definitive form and will not be considered the owners or holders thereof under
the Indenture.
Principal and interest payments on Debentures registered in the name of the
Depositary or its nominee will be made to the Depositary or its nominee, as the
case may be, as the registered owner of the Global Security. None of the
Company, the Trustee, any paying agent or the registrar for the Debentures will
have any responsibility or liability for any aspect of the records relating to
or payments made on account of beneficial interests in the Global Security or
for maintaining, supervising or reviewing any records relating to such
beneficial interest.
The Company expects that the Depositary for the Debentures or its nominee,
upon receipt of any payment of principal or interest, will credit immediately
participants' accounts with payments in amounts proportionate to their
respective beneficial interests in the principal amount of the Global Security
as shown on the records of the Depositary or its nominee. The Company also
expects that payments by participants to owners of beneficial interest in the
Global Security held through such participants will be governed by standing
instructions and customary practices, as is now the case with securities held
for the accounts of customers in bearer form or registered in "street name," and
will be the responsibility of such participants.
If the Depositary is at any time unwilling or unable to continue as
depositary and a successor Depositary is not appointed by the Company within 90
days, the Company will issue Debentures in definitive form in exchange for the
entire Global Security. In addition, the Company may at any time and in its sole
discretion determine not to have the Debentures represented by the Global
Security and, in such event, will issue Debentures in definitive form in
exchange for the entire Global Security. In any such instance, an owner of a
beneficial interest in the Global Security will be entitled to physical delivery
in definitive form of Debentures represented by the Global Security equal in
principal amount to such beneficial interest and to have such Debentures
registered in its name. Debentures so issued in definitive form will be issued
as registered Debentures in denominations of $1,000 and integral multiples
thereof, unless otherwise specified by the Company.
S-3
<PAGE> 4
Settlement for the Debentures will be made by the Underwriters in
immediately available funds. All payments of principal and interest on Global
Securities will be made by the Company in immediately available funds.
UNDERWRITING
Under the terms of and subject to the conditions contained in an
Underwriting Agreement dated October 3, 1995, the Underwriters named below have
agreed to purchase from the Company, and the Company has agreed to sell to them,
the principal amounts of the Debentures set forth below:
<TABLE>
<CAPTION>
PRINCIPAL
UNDERWRITER AMOUNT
----------------------------------------------------------------------- ------------
<S> <C>
Morgan Stanley & Co. Incorporated...................................... $ 60,000,000
Goldman, Sachs & Co.................................................... 60,000,000
Lehman Brothers Inc.................................................... 60,000,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated..................... 60,000,000
Salomon Brothers Inc................................................... 60,000,000
------------
Total............................................................. $300,000,000
===========
</TABLE>
The Underwriting Agreement provides that the obligations of the
Underwriters thereunder are subject to approval of certain legal matters by
counsel and to various other conditions. The nature of the Underwriters'
obligations is such that they are committed to take and pay for all of the
Debentures if any are taken.
The Underwriters propose to offer the Debentures in part directly to the
public at the public offering price set forth on the cover page of this
Prospectus Supplement and in part to certain dealers at such price less a
concession not in excess of .50% of the principal amount. The Underwriters may
allow, and such dealers may reallow, a concession not in excess of .25% of the
principal amount to certain other dealers. After the initial public offering,
the offering price and other selling terms may be changed by the Underwriters.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
S-4
<PAGE> 5
PROSPECTUS
$700,000,000
BELLSOUTH TELECOMMUNICATIONS, INC.
DEBT SECURITIES
BellSouth Telecommunications, Inc. (the "Company") may offer, in one or
more issues, up to $700,000,000 aggregate principal amount of its debt
securities (the "Securities") on terms to be determined at the time the
Securities are offered for sale. When a particular issue of the Securities is
offered, a prospectus supplement ("Prospectus Supplement"), together with this
prospectus, will be delivered setting forth the terms of the Securities,
including, where applicable, the specific designation, aggregate principal
amount, denominations, maturity, rate of any interest (or manner of calculation
thereof) and time of payment thereof, any redemption provisions, the initial
public offering price, the names of the underwriters, dealers or agents, any
compensation to such underwriters, dealers or agents and any other specific
terms in connection with the offering and sale of the Securities.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
---------------------
THE DATE OF THIS PROSPECTUS IS OCTOBER 3, 1995.
<PAGE> 6
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY OR ANY UNDERWRITER. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE AN IMPLICATION THAT
THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION.
---------------------
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended ("Exchange Act"), and in accordance therewith
files reports and other information with the Securities and Exchange Commission
("SEC"). Such reports and other information filed by the Company can be
inspected and copied at the public reference facilities of the SEC, Room 1024,
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, as well as at
the following SEC Regional Offices: 13th Floor, 7 World Trade Center, New York,
NY 10048 and Suite 1400, Northwestern Atrium Center, 500 West Madison Street,
Chicago, IL 60661-2511. Such material can also be inspected at the New York
Stock Exchange. Copies can be obtained from the SEC by mail at prescribed rates.
Requests should be directed to the SEC's Public Reference Section, Room 1024,
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549.
The Company is not required to deliver annual reports to its security
holders pursuant to the Exchange Act or any stock exchange requirement. Copies
of its annual, quarterly and periodic reports to the SEC on Forms 10-K, 10-Q and
8-K (containing financial information audited by independent accountants in the
case of its annual report on Form 10-K) are required to be furnished to the
trustee under the indenture or indentures pursuant to which the Securities will
be issued.
The Company has registered the Securities with the SEC pursuant to
Registration Statements Nos. 33-49991 and 33-60351 on Form S-3 (together with
all amendments and exhibits thereto, the "Registration Statements") under the
Securities Act of 1933, as amended ("Securities Act"). This Prospectus does not
contain all of the information set forth in the Registration Statements, certain
parts of which are omitted in accordance with the rules and regulations of the
SEC. For further information, reference is made to the Registration Statements.
INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents have been filed by the Company with the SEC and are
hereby incorporated herein by reference:
Annual Report on Form 10-K for the year ended December 31, 1994.
Quarterly Reports on Form 10-Q for the quarters ended March 31, and
June 30, 1995.
Current Reports on Form 8-K for May 18 and June 30, 1995.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to
the termination of the offering of the Securities shall be deemed to be
incorporated by reference in this Prospectus and to be a part hereof from the
date of filing of such documents.
COPIES OF THE ABOVE DOCUMENTS (OTHER THAN EXHIBITS TO SUCH DOCUMENTS) MAY
BE OBTAINED UPON REQUEST WITHOUT CHARGE FROM THE VICE PRESIDENT AND COMPTROLLER
OF THE COMPANY, 675 WEST PEACHTREE STREET, N.E., ATLANTA, GEORGIA 30375
(TELEPHONE NUMBER (404) 529-8611).
2
<PAGE> 7
THE COMPANY
The Company is an operating telephone company, wholly owned by BellSouth
Corporation, which provides predominantly tariffed telecommunications services
to approximately two-thirds of the population and one-half of the territory
within Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North
Carolina, South Carolina and Tennessee. It is the surviving corporation from the
merger (the "Merger"), effective at midnight on December 31, 1991, of South
Central Bell Telephone Company ("South Central Bell") and BellSouth Services
Incorporated, a jointly-owned service subsidiary of South Central Bell and
Southern Bell Telephone and Telegraph Company ("Southern Bell"), with and into
Southern Bell. At the same time Southern Bell's name was changed to "BellSouth
Telecommunications, Inc."
The Company is a Georgia corporation and has its principal executive
offices at 675 West Peachtree Street, N.E., Atlanta, Georgia 30375 (telephone
number (404) 529-8611).
USE OF PROCEEDS
The Company intends to apply the net proceeds from the sale of the
Securities primarily toward refinancing debt and also for general corporate
purposes. The Company intends to offer Securities from time to time for
refinancing purposes when and as prevailing interest rates and other market
conditions are advantageous.
DESCRIPTION OF SECURITIES
The following description sets forth certain general terms and provisions
of the Securities to which any Prospectus Supplement may relate. The particular
terms and provisions of the Securities offered by a Prospectus Supplement, and
the extent to which such general terms and provisions described below may apply
thereto, will be described in the Prospectus Supplement.
GENERAL INDENTURE PROVISIONS
The Securities are to be issued in one or more series (a "Series") under an
indenture or indentures (the "Indenture") entered or to be entered into between
the Company and one or more trustees (the "Trustee"). The following summaries of
certain provisions of the Securities and the Indenture do not purport to be
complete and are subject to, and are qualified in their entirety by reference
to, all provisions of the Indenture. Particular sections of the Indenture which
are relevant to the discussion are cited parenthetically. Capitalized terms used
in this Prospectus which are defined in the Indenture shall have the same
meaning herein as in the Indenture. "Principal" when used herein includes, when
appropriate, the premium, if any.
The Indenture does not limit the amount of securities, other than the
Securities, which may be issued or the amount of debt which may be incurred by
the Company. Reference is made to the Prospectus Supplement for the following
terms of the Securities being offered hereby: (i) the title of the Securities;
(ii) the date on which the principal of the Securities will mature; (iii) the
rate, if any, at which the Securities will bear interest, the date or dates from
which any such interest will accrue and on which such interest will be payable;
(iv) any redemption or sinking fund provisions; (v) if other than the principal
amount thereof, the portion of the principal amount of Securities which will be
payable upon declaration of acceleration of the maturity thereof; and (vi) any
additional provisions or other special terms not inconsistent with the
provisions of the Indenture, including any terms which may be required by or
advisable under United States laws or regulations or advisable in connection
with the marketing of the Securities.
The Securities will be issuable initially only as registered Securities
without coupons in denominations of $1,000 and any integral multiple of $1,000.
Principal and premium are to be payable at the office or agency of the Company
designated by the Company from time to time. Securities may be presented for
transfer or exchange at such office or agency. No service charge will be made
for any transfer or exchange.
The Securities will not be secured. The Company will covenant in the
Indenture that if it shall subject to lien any of its property, it will secure
the outstanding Securities, and any other of its obligations which may
3
<PAGE> 8
then be outstanding and entitled to the benefit of a similar covenant,* ratably
with the indebtedness or obligations secured by such lien, so long as such
obligations are so secured. The foregoing covenant will not apply to
purchase-money liens, or to deposits to secure public or statutory obligations
or with any governmental body for specified purposes. A subsidiary or other
affiliate of the Company may subject to lien any property whether or not
acquired from the Company. (Section 4.03)
The Company also will covenant that if in case of certain events -- namely,
(a) any consolidation or merger of the Company and any other corporation, or (b)
any sale or conveyance of the property of the Company as an entirety or
substantially as an entirety to any other corporation, or (c) the acquisition by
the Company of the property of any other corporation as an entirety or
substantially as an entirety -- any of the property owned by the Company
immediately prior to such event would thereupon become subject to any lien, the
Company prior to such event will secure the outstanding Securities and any other
of its obligations which may then be outstanding and entitled to the benefit of
a similar covenant;* ratably by a direct lien on all such property of the
Company, prior to any lien to which such property would become subject by reason
of such event. In case the Securities have been secured pursuant to the
provisions described in this paragraph by a direct lien on substantially all of
the telephone plant and on all securities of affiliates owned by the Company,
the covenants described in this paragraph and the preceding paragraph will no
longer be of any effect. As used in the covenants referred to in this paragraph
and the following paragraph, the word "securities" will be defined to mean
stocks and all indebtedness except indebtedness (other than that arising from
borrowing) incurred in the ordinary course of business. (Section 4.04)
The Indenture provides that the Company may be discharged from all
obligations under outstanding Securities of any Series upon the irrevocable
deposit with the Trustee as trust funds solely for the benefit of the holders of
such Securities money and/or U.S. Government Obligations (as defined in the
Indenture) sufficient to pay and discharge the principal of (and premium, if
any) and interest on such Securities. Except in the case of Securities becoming
due and payable within one year, the Company shall deliver to the Trustee a
ruling from the Internal Revenue Service or an Opinion of Counsel (as defined in
the Indenture) to the effect that the holders of such Securities will not
recognize income, gain or loss for federal income tax purposes as a result of
the payment and discharge and will be subject to federal income tax on the same
amount and in the same manner and at the same times as would have been the case
if such payment and discharge had not occurred. On substantially the same terms
and conditions, the Company may be relieved from the obligation to comply with
certain covenants in the Indenture, including those described in the preceding
two paragraphs. (Section 11.01)
The Indenture will contain provisions permitting the Company and the
Trustee, with the consent of the holders of not less than 66 2/3% in aggregate
principal amount of the Securities at the time outstanding, to modify the
Indenture or any supplemental indenture or the rights of the holders of the
Securities; provided that no such modification shall (i) extend the fixed
maturity of any Securities, or reduce the principal amount thereof, or reduce
the rate or extend the time of payment of interest thereon, or reduce any
premium payable upon the redemption thereof, without the consent of the holder
of each Security so affected, or (ii) reduce the aforesaid percentage of
Securities, the consent of the holders of which is required for any such
modification, without the consent of the holders of all Securities then
outstanding. The Indenture will also contain provisions permitting the Company
and the Trustee, without the consent of the holders of Securities, to modify the
Indenture or any supplemental indenture or the rights of the holders of the
Securities for certain limited purposes. (Section 9.02)
Under the Indenture an Event of Default with respect to Securities of any
Series means, with respect to Securities of such Series: default for 90 days in
payment of interest; default in payment of principal or premium; default for 90
days after notice by the Trustee or the holders of at least 25% in aggregate
principal amount of Securities of such Series then outstanding in performance of
any other covenants in the Indenture; or certain events in bankruptcy,
insolvency or reorganization. (Section 6.01)
- ---------------
* Each outstanding issue of long and intermediate term debt of the Company is
entitled to the benefit of a similar covenant.
4
<PAGE> 9
Subject to the duty of the Trustee during default to act with the specified
standard of care, the Trustee before taking any action under the Indenture is
entitled to reasonable security or indemnity (Sections 7.01 and 7.02). Subject
to such provisions for the indemnification of the Trustee, the holders of a
majority of the principal amount of outstanding Securities of a Series may
direct the time, method and place for certain actions by the Trustee with
respect to Securities of such Series. (Section 6.06)
Except as may be otherwise described in a Prospectus Supplement, the
covenants contained in the Indenture would not afford holders of the Securities
protection in the event of a highly-leveraged transaction involving the Company.
GLOBAL SECURITIES
The Securities of a Series may be issued in the form of one or more fully
registered global Securities (a "Global Security") that will be deposited with
The Depository Trust Company (the "Depositary") or with a nominee for the
Depositary. In such case, one or more Global Securities will be registered in
the name of Cede & Co., as nominee for the Depositary and issued in a
denomination or aggregate denominations equal to the portion of the aggregate
principal amount of outstanding Securities of the Series to be represented by
such Global Security or Securities. Unless and until it is exchanged in whole or
in part for Securities in definitive registered form, a Global Security may not
be transferred except as a whole by the Depositary for such Global Security to a
nominee of such Depositary or by a nominee of such Depositary to such Depositary
or another nominee of such Depositary or by such Depositary or any such nominee
to a successor Depositary or a nominee of such successor. The laws of some
States require that certain purchasers of securities take physical delivery of
such securities in definitive form. Such limits and such laws may impair the
ability to transfer beneficial interests in the Global Security.
The Depositary has informed the Company that it is a limited-purpose trust
company organized under the New York Banking Law, a "banking organization"
within the meaning of the New York Banking Law, a member of the Federal Reserve
System, a "clearing corporation" within the meaning of the New York Uniform
Commercial Code and a "clearing agency" registered pursuant to the provisions of
Section 17A of the Exchange Act. The Depositary holds securities that its
participants deposit with it. The Depositary also facilitates the settlement
among participants of securities transactions, such as transfers and pledges, in
deposited securities through electronic computerized book-entry changes in
participants' accounts, thereby eliminating the need for physical movement of
securities certificates. Direct participants include securities brokers and
dealers, banks, trust companies, clearing corporations and certain other
organizations. The Depositary is owned by a number of its direct participants
and by The New York Stock Exchange, Inc., the American Stock Exchange, Inc. and
the National Association of Securities Dealers, Inc. Access to its system is
also available to others such as securities brokers and dealers, banks, and
trust companies that clear through or maintain a custodial relationship with a
direct participant, either directly or indirectly. The rules applicable to the
Depositary and its participants are on file with the Commission.
The specific terms of the depositary arrangement with respect to any
portion of a Series of Securities to be represented by a Global Security will be
described in the Prospectus Supplement relating to such Series. The Company
anticipates that the following provisions will apply to all depositary
arrangements.
Upon the issuance of a Global Security, the Depositary for such Global
Security will credit, on its book-entry registration and transfer system, the
respective principal amounts of the Securities represented by such Global
Security to the accounts of persons that have accounts with such Depositary
("participants"). The accounts to be credited shall be designated by any
underwriters or agents participating in the distribution of such Securities.
Ownership of beneficial interests in a Global Security will be limited to
participants or persons that may hold interests through participants. Ownership
of beneficial interests in such Global Security will be shown on, and the
transfer of that ownership will be effected only through, records maintained by
the Depositary for such Global Security (with respect to interests of
participants) or persons that hold interests
5
<PAGE> 10
through participants (with respect to interests of persons other than
participants) in accordance with the procedures of the Depositary.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depositary or such nominee, as
the case may be, will be considered the sole owner or holder of the Securities
represented by such Global Security for all purposes under the Indenture. Except
as set forth below, owners of beneficial interests in a Global Security will not
be entitled to have the Securities represented by such Global Security
registered in their names, will not receive or be entitled to receive physical
delivery of such Securities in definitive form and will not be considered the
owners or holders thereof under the Indenture. Accordingly, each person owning a
beneficial interest in a Global Security must rely on the procedures of the
Depositary for such Global Security and, if such person is not a participant, on
the procedures of the participant through which such person owns its interest,
to exercise any rights of a holder under the Indenture. The Company understands
that under existing industry practices, if the Company requests any action of
holders or if an owner of a beneficial interest in a Global Security desires to
give or take any action which a holder is entitled to give or take under the
Indenture, the Depositary for such Global Security would authorize the
participants holding the relevant beneficial interests to give or take such
action, and such participants would authorize beneficial owners owning through
such participants to give or take such action or would otherwise act upon the
instructions of beneficial owners holding through them.
Principal and interest payments on Securities represented by a Global
Security registered in the name of a Depositary or its nominee will be made to
such Depositary or its nominee, as the case may be, as the registered owner of
such Global Security. None of the Company, the Trustee or any paying agent for
such Securities will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests in such Global Security or for maintaining, supervising or reviewing
any records relating to such beneficial ownership interests.
The Company expects that the Depositary for any Securities represented by a
Global Security, upon receipt of any payment of principal or interest, will
immediately credit participants' accounts with payments in amounts proportionate
to their respective beneficial interests in the principal amount of such Global
Security as shown on the records of such Depositary. The Company also expects
that payments by participants to owners of beneficial interests in such Global
Security held through such participants will be governed by standing
instructions and customary practices, as is now the case with the securities
held for the accounts of customers registered in "street names" and will be the
responsibility of such participants.
If the Depositary for any Securities represented by a Global Security is at
any time unwilling or unable to continue as Depositary and a successor
Depositary is not appointed by the Company within 90 days, the Company will
issue such Securities in definitive form in exchange for such Global Security.
In addition, the Company may at any time and in its sole discretion determine
not to have any of the Securities of a Series represented by one or more Global
Securities and, in such event, will issue Securities of such Series in
definitive form in exchange for all of the Global Security or Securities
representing such Securities. In such instance, a beneficial owner of a Global
Security will be entitled to physical delivery in definitive form of Securities
of such Series represented by the Global Security equal in principal amount to
such beneficial interest and to have such Securities registered in its name.
Securities so issued in definitive form will be issued as registered Securities
in authorized denominations. Any Securities issued in definitive form in
exchange for a Global Security will be registered in such name or names as the
Depositary shall instruct the Trustee. It is expected that such instructions
will be based upon directions received from the Depositary from participants
with respect to ownership of beneficial interests in such Global Security.
PLAN OF DISTRIBUTION
The Company may sell the Securities being offered hereby in four ways: (i)
directly to purchasers, (ii) through agents, (iii) through underwriters (the
"Underwriters") and (iv) through dealers.
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The distribution of the Securities may be effected from time to time in one
or more transactions either (i) at a fixed price or prices, which may be
changed, (ii) at market prices prevailing at the time of sale, (iii) at prices
related to such prevailing market prices or (iv) at negotiated prices.
In connection with the sale of Securities, Underwriters or agents may
receive compensation from the Company 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
received by them from the Company and any profit on the resale of Securities by
them 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 the Company will be described, in the Prospectus
Supplement.
The Underwriters and other persons may be entitled, under agreements which
may be entered into with the Company, to indemnification against certain civil
liabilities, including liabilities under the Securities Act.
LEGAL OPINIONS
Mr. Roger M. Flynt, Jr., Vice President and General Counsel of the Company,
is passing upon the legality of the Securities for the Company, relying on the
opinions of other counsel as to certain matters. Mr. Flynt may be deemed to own
beneficially 60,521 shares of BellSouth Common Stock, including interests
through various BellSouth benefit plans.
On behalf of dealers, underwriters or agents, Davis Polk & Wardwell is
passing upon certain legal matters in connection with the offering of the
Securities.
INDEPENDENT ACCOUNTANTS
The financial statements of the Company included in its Annual Report on
Form 10-K for the year ended December 31, 1994 and incorporated by reference
herein, have been audited by Coopers & Lybrand L.L.P., independent accountants,
to the extent and for the periods indicated in their reports relating to such
financial statements, which are also incorporated by reference herein, and have
been so included in reliance upon the reports of Coopers & Lybrand L.L.P. given
upon their authority as experts in auditing and accounting.
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