SOUTHERN CALIFORNIA EDISON COMPANY
Authorized Officer's Certificate
Pursuant to Section 301 of the Indenture
Mary C. Simpson, an Authorized Officer of Southern California Edison
Company, a California corporation (the "Company"), acting pursuant to the March
16, 2000, and November 6, 2000, resolutions of the Board of Directors and the
Executive Committee of the Board of Directors of the Company (the "Board
Resolutions") hereby determines that:
1. The Company shall issue a series of the Securities referred to in the
Board Resolution under the Indenture, dated as of January 15, 1993 (the
"Indenture"), between the Company and Harris Trust and Savings Bank (now The
Bank of New York), as Trustee (the "Trustee"), in accordance with the following
terms:
(a) The title of the Debt Securities shall be the "Variable Rate Notes
due 2003" (the "Notes").
(b) The aggregate principal amount of the Notes to be authenticated
and delivered under the Indenture shall be limited to $1,000,000,000
(except for Notes authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Notes pursuant to Sections
304, 305, 306, 906 or 1107 of the Indenture).
(c) The Notes shall mature on November 3, 2003.
(d) The Notes shall bear interest at the rate of 7.20%, subject to
adjustment as set forth below, from November 8, 2000. The Interest Payment
Dates for the Notes shall be May 1 and November 1 in each year, commencing
May 1, 2001, through the maturity date of November 3, 2003. Interest will
be paid to holders of record on the 15th calendar day before each Interest
Payment Date. If any scheduled Interest Payment Date falls on a day that is
not a business day, it will be postponed to the following business day. If
the maturity date of the Notes falls on a day that is not a business day,
the Company will make the required payment of principal and/or interest on
the following business day. Additional interest will not accrue as a result
of this delayed payment. The Regular Record Dates for the interest payable
on such Interest Payment Dates shall be the 15th calendar day before each
Interest Payment Dates.
Interest on the Notes will be calculated on the basis of a 360-day year
consisting of twelve 30-day months. All dollar amounts resulting from such
calculation will be rounded, if necessary, to the nearest cent with
one-half cent rounded upward.
The interest rate for the Notes will be subject to adjustment until May 1,
2002. In the event of a downgrade in the senior unsecured long-term debt
rating of the Company (the "Rating") below A3 by Moody's Investors Service,
Inc. ("Moody's") or below A- by Standard & Poor's Rating Service ("S&P"),
the interest rate on the Notes will be adjusted in accordance with the
table below.
If, prior to May 1, 2002, either Moody's or S&P changes the Rating
subsequent to an adjustment in the interest rate as a result of a previous
Rating change by Moody's or S&P, the interest rate on the Notes will be
re-adjusted in accordance with the table below.
The Notes will bear interest at an annual rate of 7.20% from November 8,
2000,until the first day of the first Interest Period following a downgrade
in the Rating below A3 by Moody's or A- by S&P.
<PAGE>
Beginning with the first day of the first Interest Period after a Rating
change by Moody's or S&P, the Notes will bear interest at an adjusted
interest rate. Subsequent interest rate adjustments (whether the adjustment
is up or down) will also become effective on the first day of the first
Interest Period after such Rating change.
The adjusted annual interest rate for the Notes will be 7.20% increased by
the sum of the Moody's and S&P adjustment amounts set forth below.
<TABLE>
<CAPTION>
----------------------------- --------------------- --------------------- ------------------
Moody's S&P
Moody's Rating Adjustment Adjustment
Amount S&P Rating Amount
------------------------------------------------------------------------- ----------------
<S> <C> <C> <C>
A3 0.000% A- 0.000%
----------------------------- --------------------- --------------------- ------------------
Baa1 0.125% BBB+ 0.125%
----------------------------- --------------------- --------------------- ------------------
Baa2 0.250% BBB 0.250%
----------------------------- --------------------- --------------------- ------------------
Baa3 0.375% BBB- 0.375%
----------------------------- --------------------- --------------------- ------------------
Ba1 or lower 0.875% BB+ or lower 0.875%
----------------------------- --------------------- --------------------- ------------------
</TABLE>
(e) Payment of the principal of, and interest on, the Notes will be
made at the Corporate Trust Office of The Bank of New York maintained for
that purpose in the City of Chicago, State of Illinois, in such coin or
currency of the United States of America as at the time of payment is legal
tender for the payment of public and private debts; provided, however, that
at the option of the Company, payment of interest may be made by check
mailed to the address of the person entitled thereto as such address shall
appear in the Security Register or by wire transfer to an account
designated by such person pursuant to an arrangement that is satisfactory
to the Trustee and the Company.
(f) The Notes may be redeemed in whole or in part at the Company's
option at any time at a redemption price equal to the greater of (1) the
principal amount to be redeemed or (2) the sum of the present values of the
remaining scheduled payments of principal and interest on the Notes to be
redeemed, discounted to the redemption date on a semiannual basis (assuming
a 360-day year consisting of twelve 30-day months) at the Treasury Yield
plus 0.25%, as determined by the Independent Investment Banker.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Notes that would be utilized, at
the time of selection and in accordance with customary financial practice,
in pricing new issues of corporate debt securities of comparable maturity
to the remaining term of the Notes.
"Comparable Treasury Price" means, with respect to any Redemption
Date, (i) the average of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal
amount) on the third business day preceding such Redemption Date, as set
forth in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30 p.m.
Quotations for U.S. Government Securities" or (ii) if that release (or any
successor release) is not published or does not contain such prices on such
business day, (A) the average of the Reference Treasury Dealer Quotations
for such Redemption Date, after excluding the highest and lowest such
Reference Treasury Dealer Quotations for such Redemption Date, or (B) if
the Independent Investment Banker obtains fewer than four such Reference
Treasury Dealer Quotations, the average of all such Quotations.
"Independent Investment Banker" means Chase Securities Inc. or Lehman
Brothers Inc., as selected by the Company, or, if such firms are unwilling
or unable to select the Comparable Treasury Issue, an independent
investment banking institution of national standing selected by the Company
and appointed by the Trustee.
<PAGE>
"Interest Period" means the period commencing on an Interest Payment
Date for the Notes (or commencing on the issue date for the Notes, if no
interest has been paid or duly made available for payment since that date)
and ending on the day before the next succeeding Interest Payment Date for
the Notes.
"Reference Treasury Dealer" means each of Chase Securities Inc.,
Lehman Brothers Inc., Banc of America Securities LLC, Credit Suisse First
Boston Corporation and Salomon Smith Barney Inc., and their respective
successors, provided, however, that if any of the foregoing shall cease to
be a primary U.S. Government Securities dealer (a "Primary Treasury
Dealer"), the Company shall substitute for it another Primary Treasury
Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any Redemption Date, the average, as
determined by the Trustee, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal
amount) quoted in writing to the Trustee by such Reference Treasury Dealer
at 5:00 p.m. on the third business day preceding such Redemption Date.
"Treasury Yield" means, with respect to any Redemption Date, the rate
per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury
Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for the Redemption Date.
If the Company elects to redeem less than all of the Notes, the
Trustee shall select, in a manner it deems fair and appropriate, the
particular Notes or portions of them to be redeemed. Notice of redemption
shall be given by mail not less than 30 nor more than 60 days prior to the
Redemption Date to the Holders of Notes to be redeemed (which, as long as
the Notes are held in the book-entry only system, will be The Depository
Trust Company, its nominees or successors). On and after the Redemption
Date (unless the Company defaults in the payment of the Redemption Price
and interest accrued thereon to such date), interest shall cease to accrue
on the Notes or the portions of them called for redemption, and the Notes
shall cease to be outstanding.
(g) The Company shall not be obligated to redeem, repay or purchase
the Notes pursuant to any sinking fund or analogous provision, or at the
option of the Holder thereof.
(h) The certificates representing the Notes will be issued in fully
registered form, without coupons.
(i) The Notes shall be issued in whole in the form of one or more
Global Securities, and the Depositary for such Global Securities shall be
The Depository Trust Company, New York, New York.
(j) The following additional covenant will apply with respect to the
Notes:
The Company shall not, until May 1, 2002, directly or indirectly
create, incur, assume or otherwise allow to exist any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind (collectively
referred to as "liens")with respect to any of its assets or property, or
any income or profits therefrom, for the purpose of securing any
indebtedness for borrowed money evidenced by a bond, note, debenture,
security or similar instrument, or any guaranty of any such indebtedness,
unless at the same time it provides equal and ratable security for the
benefit of the Notes which are outstanding at such time. This covenant
shall not apply to:
<PAGE>
o liens arising under the indenture dated as of October 1, 1923, as
amended and supplemented, between the Company and The Bank of New
York, as successor trustee (the "Mortgage Indenture"), providing for
the issuance of first and refunding mortgage bonds of the Company;
provided, that the aggregate principal amount of the mortgage bonds
outstanding under the Mortgage Indenture does not exceed the amount
outstanding as of the date the notes are issued;
o to the extent the Company refinances or prefinances any debt under the
Mortgage Indenture, any lien securing debt incurred by the Company
within 91 days before or after the repurchase, redemption or
retirement of debt under the Mortgage Indenture, provided that (i) the
proceeds of the new debt are used to fund or replace funds used for
the repurchase, redemption or retirement of debt under the Mortgage
Indenture, (ii) the amount of the new debt does not exceed an amount
equal to the sum of the amount of debt that is to be repurchased,
redeemed or retired and the reasonable costs associated with
repurchasing, redeeming or retiring debt under the Mortgage Indenture
and incurring such new debt and (iii) the liens securing such new debt
shall not encumber any assets other than those encumbered by the lien
of the Mortgage Indenture;
o liens on "transition property" or securing the repayment of "rate
reduction bonds," as such terms are defined in Section 840 of the
California Public Utilities Code;
o liens on general intangibles or other property pledged to ensure the
payment of principal and interest on debt issued to finance or
refinance some or all of the undercollection reflected in the
Company's Transition Revenue Account (TRA) or any other accounts
established for the same or similar purposes as the TRA;
o liens incurred in connection with financing or refinancing the costs
of air or water pollution control, solid waste disposal or sewage
facilities;
o liens incurred in connection with sale-leaseback transactions by the
Company;
o liens on property of a person existing at the time the capital stock
of such person is acquired by, or such person is merged into or
consolidated with, the Company; provided that such liens were in
existence before the contemplation of such acquisition, merger or
consolidation and do not extend to any assets other than those of the
person whose capital stock was acquired by, or that was merged into or
consolidated with, the Company;
o liens on property existing at the time such property is acquired by
the Company, provided that such liens were in existence before the
contemplation of such acquisition and do not extend to any additional
assets;
o purchase money liens upon or in any real or personal property
(including fixtures and other equipment) to secure the purchase price
of such property or to secure indebtedness incurred solely to finance
or refinance the acquisition or improvement of such property and
incurred within 180 days after completion of such acquisition or
improvement, provided that such liens do not extend to any property
other than the property being acquired or improved;
<PAGE>
o liens incurred in connection with the securitization or other
financing of revenues arising from added facilities contracts,
generation tie-line agreements, or other arrangements in which third
parties agree to pay over time the costs of facilities or equipment to
be constructed and/or operated by the Company;
o liens to secure the performance of statutory obligations, surety or
appeal bonds, performance bonds or other obligations of a like nature
incurred in the ordinary course of business;
o liens existing on the date the Notes are issued, and any extension,
renewal or replacement (or successive extensions, renewals or
replacements) of any such lien; provided, that such renewal,
replacement or extension does not cover any additional assets or
property not contemplated by the liens existing on the date the Notes
are issued;
o liens for taxes, assessments or governmental charges or claims that
are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently concluded,
provided that any reserve or other appropriate provision as shall be
required in conformity with GAAP shall have been made therefor;
o carriers', warehousemen's, mechanics', landlords', materialmen's,
repairmen's or other similar liens arising in the ordinary course of
business in respect of obligations that are not yet due, are bonded or
are being contested in good faith and by appropriate proceedings if
adequate reserves with respect thereto are maintained on the books of
the Company in accordance with GAAP; and
o liens arising by reason of a judgment, decree or court order, to the
extent not otherwise resulting in an event of default under the
Indenture.
Notwithstanding the above, the Company may, without securing the Notes,
create, assume or guarantee liens or indebtedness which would otherwise be
subject to the foregoing restrictions, provided that, after giving effect
thereto, the aggregate amount of all secured debt then outstanding (not
including secured debt permitted under the foregoing exceptions) at such
time does not exceed 10% of the consolidated net tangible assets of the
Company.
"consolidated net tangible assets" of the Company means, as of any
particular time, the aggregate amount of assets after deducting therefrom
(a) all current liabilities (excluding any such liability that by its terms
is extendable or renewable at the option of the obligor thereon to a time
more than 12 months after the time as of which the amount thereof is being
computed) and (b) all goodwill, excess of cost over assets acquired,
patents, copyrights, trademarks, tradenames, and other like intangibles,
all as shown in the Company's most recent consolidated financial statements
prepared in accordance with generally accepted accounting principles.
(k) The Notes shall not be subject to discharge and defeasance at the
option of the Company pursuant to Section 1301 of the Indenture.
(l) The trustee, authenticating and paying agent, transfer agent and
registrar with respect to the Notes shall be The Bank of New York.
2. The form and terms of the Notes, attached hereto as Annex A, are hereby
approved.
<PAGE>
3. Chase Securities Inc., Lehman Brothers Inc., Banc of America Securities
LLC, Credit Suisse First Boston Corporation and Salomon Smith Barney Inc. (the
"Underwriters") propose to offer the Notes at an initial offering price of
99.851% of their principal amount. The purchase price of the Notes to be paid by
the Underwriters shall be 99.501% of their principal amount, plus accrued
interest from November 8, 2000. The Underwriting Agreement, dated November 3,
2000, between the Company and the Underwriters, relating to the Notes, attached
hereto as Annex B, is hereby approved.
4. The undersigned has read the provisions of Section 301 of the Indenture
and the definitions in the Indenture relating thereto, the Board Resolutions and
other corporate documents and records. In the opinion of the undersigned, she
has made such examination or investigation as is necessary to enable her to
express an informed opinion as to whether or not all conditions precedent
provided in the Indenture relating to the establishment of the forms of and
terms of a series of Notes under the Indenture, designated as the Notes in this
Certificate, have been complied with. In the opinion of the undersigned, all
such conditions precedent have been complied with.
5. Capitalized terms used in this certificate and not otherwise defined
herein shall have the meanings ascribed to such terms in the Indenture.
<PAGE>
IN WITNESS WHEREOF, the undersigned has executed this certificate as of
November 3, 2000.
Mary C. Simpson
-------------------------------
Mary C. Simpson
Assistant Treasurer
<PAGE>
ANNEX A
This Debt Security is a Global Security within the meaning of the Indenture
hereafter referred to and is registered in the name of a Depositary or a nominee
thereof. Unless and until it is exchanged in whole or in part for Debt
Securities in definitive form, this Debt Security may not be transferred except
as a whole by the Depositary to a nominee of the Depositary or by a nominee of
the Depositary to the Depositary or another nominee of the Depositary or by the
Depositary or any such nominee to a successor Depositary or a nominee of such
successor Depositary. Unless otherwise defined herein, all capitalized items
shall have the same meanings ascribed to them in the Indenture.
-------------------------------------------------------------------------------
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Company or its
agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or in such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
SOUTHERN CALIFORNIA EDISON COMPANY
(Incorporated under the laws of the State of California)
VARIABLE RATE NOTES DUE 2003
No. _____________ $ ____________________
CUSIP NO. 842 400 EF 6
Southern California Edison Company, a corporation duly organized and
existing under the laws of the State of California (herein called the "Company",
which term includes any successor Person under the Indenture hereinafter
referred to), for value received, hereby promises to pay _____________________or
registered assigns, the principal sum of _____________________________________
on November 3, 2003, and to pay interest thereon from November 8, 2000, or from
the most recent Interest Payment Date (defined below) to which interest has been
paid or duly provided for, semi-annually on May 1 and November 1 in each year,
commencing on May 1, 2001 (each an "Interest Payment Date") at the rate of
7.20% per annum (subject to adjustment as provided below), until the principal
hereof is paid or made available for payment, and at such rate per annum on any
overdue principal and on any overdue installment of interest. If any scheduled
Interest Payment Date falls on a day that is not a business day, it will be
postponed to the following business day. If the maturity date of the Debt
Security falls on a day that is not a business day, the Company will make the
required payment of principal and/or interest on the following business day.
Additional interest will not accrue as a result of this delayed payment.
Interest on the Debt Securities will be calculated on the basis of a 360-day
year consisting of twelve 30-day months. All dollar amounts resulting from such
calculation will be rounded, if necessary, to the nearest cent with one-half
cent rounded upward. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in such Indenture,
be paid to the Person in whose name this Debt Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the 15th calendar day (whether or
not a Business Day), as the case may be, immediately preceding such Interest
Payment Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Debt Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Debt Securities of this
series not less than 10 days prior to such Special Record Date, or be paid at
any time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Debt Securities of this series may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in such Indenture.
<PAGE>
Payment of the principal of and premium, if any, and interest on this
Debt Security will be made at the office or agency of The Bank of New York,
Trustee, Chicago, Illinois, in such coin or currency of the United States of
America as at the time of payment is legal tender for the payment of public and
private debts; provided, however, that at the option of the Company, payment of
interest may be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register or by wire
transfer to an account designated by such person pursuant to an arrangement that
is satisfactory to the Trustee and the Company.
Reference is hereby made to the further provisions of this Debt
Security set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof, by manual signature, this Debt
Security shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: November 8, 2000
SOUTHERN CALIFORNIA EDISON COMPANY
By _______________________________
Assistant Treasurer
(Seal)
ATTEST:
----------------------------
Assistant Secretary
<PAGE>
CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the series referred to in the
within-mentioned Indenture.
THE BANK OF NEW YORK,
as Trustee
By ________________________________
Authorized Signatory
<PAGE>
[Reverse of Bond]
This Debt Security is one of a duly authorized issue of securities of
the Company (herein called the "Debt Securities"), issued and to be issued in
one or more series under an Indenture, dated as of January 15, 1993 (herein
called the "Indenture"), between the Company, and The Bank of New York, as
successor Trustee (herein called the "Trustee", which term includes any
successor trustee under the Indenture) to Harris Trust and Savings Bank, to
which Indenture and all indentures supplemental thereto reference is hereby made
for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Holders of the Debt
Securities and of the terms upon which the Debt Securities are, and are to be,
authenticated and delivered. This Debt Security is one of the series designated
on the face hereof, limited in aggregate principal amount to $1,000,000,000.
The interest rate for the Debt Securities will be subject to adjustment
until May 1, 2002. In the event of a downgrade in the senior unsecured long-term
debt rating of the Company (the "Rating") below A3 by Moody's Investors Service,
Inc. ("Moody's") or below A- by Standard & Poor's Rating Service ("S&P"), the
interest rate on the Debt Securities will be adjusted in accordance with the
table below.
If, prior to May 1, 2002, either Moody's or S&P changes the Rating
subsequent to an adjustment in the interest rate as a result of a previous
Rating change by Moody's or S&P, the interest rate on the Debt Securities will
be re-adjusted in accordance with the table below.
The Debt Securities will bear interest at an annual rate of 7.20% from
November 8, 2000, until the first day of the first Interest Period following a
downgrade in the Rating below A3 by Moody's or A- by S&P.
Beginning with the first day of the first Interest Period after a
Rating change by Moody's or S&P, the Debt Securities will bear interest at an
adjusted interest rate. Subsequent interest rate adjustments (whether the
adjustment is up or down) will also become effective on the first day of the
first Interest Period after such Rating change.
The adjusted annual interest rate for the Debt Securities will be 7.20%
increased by the sum of the Moody's and S&P adjustment amounts set forth below.
<TABLE>
<CAPTION>
---------------------------- ------------------------------ ------------------------- ---------------------------
Moody's Adjustment S&P Adjustment
Moody's Rating Amount S&P Rating Amount
---------------------------- ------------------------------ ------------------------- ---------------------------
<S> <C> <C> <C>
A3 0.000% A- 0.000%
---------------------------- ------------------------------ ------------------------- ---------------------------
Baa1 0.125% BBB+ 0.125%
---------------------------- ------------------------------ ------------------------- ---------------------------
Baa2 0.250% BBB 0.250%
---------------------------- ------------------------------ ------------------------- ---------------------------
Baa3 0.375% BBB- 0.375%
---------------------------- ------------------------------ ------------------------- ---------------------------
Ba1 or lower 0.875% BB+ or lower 0.875%
---------------------------- ------------------------------ ------------------------- ---------------------------
</TABLE>
If an Event of Default with respect to Debt Securities of this series
shall occur and be continuing, the principal of the Debt Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture.
<PAGE>
This Debt Security may be redeemed at any time prior to the Stated
Maturity of the principal hereof at the option of the Company at a Redemption
Price equal to the greater of (1) the principal amount or (2) the sum of the
present values of the remaining scheduled payments of principal and interest on
this Debt Security, discounted to the Redemption Date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Treasury
Yield plus 0.25%, plus in each case accrued interest to the Redemption Date.
"Treasury Yield" means, with respect to any Redemption Date, the rate
per annum equal to the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as
a percentage of its principal amount) equal to the Comparable Treasury Price for
the Redemption Date.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity comparable to
the remaining term of the Debt Securities that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new
issues of corporate debt securities of comparable maturity to the remaining term
of the Debt Securities.
"Independent Investment Banker" means Chase Securities Inc. or Lehman
Brothers Inc., as selected by the Company, or, if such firms are unwilling or
unable to select the Comparable Treasury Issue, an independent investment
banking institution of national standing selected by the Company and appointed
by the Trustee.
"Comparable Treasury Price" means, with respect to any Redemption Date,
(i) the average of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) on the third
business day preceding such Redemption Date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Securities" or (ii) if that release (or any successor release) is not
published or does not contain such prices on such business day, (A) the average
of the Reference Treasury Dealer Quotations for such Redemption Date, after
excluding the highest and lowest such Reference Treasury Dealer Quotations for
such Redemption Date, or (B) if the Independant Investment Banker obtains fewer
than four such Reference Treasury Dealer Quotations, the average of all such
Quotations.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any Redemption Date, the average, as determined by
the Trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m. on the
third business day preceding such Redemption Date.
"Reference Treasury Dealer" means each of Chase Securities Inc., Lehman
Brothers Inc., Banc of America Securities LLC, Credit Suisse First Boston
Corporation and Salomon Smith Barney Inc. and their respective successors,
provided, however, that if any of the foregoing shall cease to be a primary U.S.
Government Securities dealer in New York City (a "Primary Treasury Dealer"), the
Company shall substitute for it another Primary Treasury Dealer.
"Interest Period" means the period commencing on an Interest Payment
Date for the Debt Securities (or commencing on November 8, 2000, if no interest
has been paid or duly made available for payment since that date) and ending on
the day before the next succeeding Interest Payment Date for the Debt
Securities.
If the Company elects to redeem less than all of the Debt Securities,
the Trustee shall select, in a manner it deems fair and appropriate, the
particular Debt Securities or portions of them to be redeemed. Notice of
redemption shall be given by mail not less than 30 nor more than 60 days prior
to the Redemption Date to the Holders of Debt Securities to be redeemed (which,
as long as the Debt Securities are held in the book-entry only system, will be
The Depository Trust Company, its nominees or successors). On and after the
Redemption Date (unless the Company defaults in the payment of the Redemption
Price and interest accrued thereon to such date), interest shall cease to accrue
on the Debt Securities or the portions of them called for redemption and the
Debt Securities shall cease to be outstanding.
<PAGE>
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Debt Securities of each series to
be affected under the Indenture at any time by the Company and the Trustee with
the consent of the Holders of a majority in principal amount of the Debt
Securities at the time Outstanding of each series to be affected. The Indenture
also contains provisions permitting the Holders of specified percentages in
principal amount of the Debt Securities of each series at the time Outstanding,
on behalf of the Holders of all Debt Securities of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Debt Security shall be conclusive and binding upon
such Holder and upon all future Holders of this Debt Security and of any Debt
Security issued upon the registration of transfer hereof or in exchange herefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Debt Security.
No reference herein to the Indenture and no provision of this Debt
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
premium, if any, and interest on this Debt Security at the times, place and
rate, and in the coin or currency, herein prescribed.
As provided in and subject to the provisions of the Indenture, the
Holder of this Debt Security shall not have the right to institute any
proceeding with respect to the Indenture or for the appointment of a receiver or
trustee or for any other remedy thereunder, unless such Holder shall have
previously given the Trustee written notice of a continuing Event of Default
with respect to the Debt Securities of this series, the Holders of not less than
25% in principal amount of the Debt Securities of this series (or, in the case
of certain Events of Default under the Indenture, not less than 25% in principal
amount of all Debt Securities) at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity and the Trustee
shall not have received from the Holders of a majority in principal amount of
Debt Securities of this series at the time Outstanding a direction inconsistent
with such request, and shall have failed to institute any such proceeding, for
60 days after receipt of such notice, request and offer of indemnity. The
foregoing shall not apply to any suit instituted by the Holder of this Debt
Security for the enforcement of any payment of principal hereof or any premium
or interest hereon on or after the respective due dates expressed herein.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Debt Security is registrable in the Security
Register, upon surrender of this Debt Security for registration of transfer at
the office or agency of the Company in any place where the principal of and
premium, if any, and interest of this Debt Security are payable, duly endorsed
by, or accompanied by a written instrument of transfer in form satisfactory to
the Company and the Security Registrar duly executed by, the Holder hereof or
the Holder's attorney duly authorized in writing, and thereupon one or more new
Debt Securities of this series and of like tenor, of authorized denominations
and for the same aggregate principal amount, will be issued to the designated
transferee or transferees.
The Debt Securities of this series are issuable only in registered form
without coupons in denominations of $1,000 and integral multiples thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Debt Securities of this series are exchangeable for a like aggregate principal
amount of Debt Securities of this series and of like tenor, of a different
authorized denomination, as requested by the Holder surrendering the same.
<PAGE>
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Debt Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Debt Security is registered as the owner
hereof for all purposes, whether or not this Debt Security be overdue, and
neither the Company, the Trustee nor any such agent shall be affected by notice
to the contrary.
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations.
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as tenants
in common
UNIF GIFT MIN ACT -
Custodian
--------------------- -----------------------
(Cust) (Minor)
under Uniform Gifts of Minors
Act
--------------------------------------------------
(State)
Additional abbreviations may also be used though not in the above list.
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
Please insert Social Security or Other
Identifying Number of Assignee
------------------------------------------------------------------------------
------------------------------------------------------------------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
------------------------------------------------------------------------------
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the Debt Security and all rights thereunder, hereby irrevocably
constituting and appointing
-----------------------------------------------------------------------Attorney
to transfer the said Debt Security on the books of the Company, with full power
of substitution in the premises.
Dated:
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NOTICE: -------------------------------------------------
The signature to this assignment must correspond
with the name as written upon the face of the within
instrument in every particular, without alteration or
enlargement or any change whatsoever.
